ML20095L086
| ML20095L086 | |
| Person / Time | |
|---|---|
| Site: | Crystal River  |
| Issue date: | 12/31/1991 |
| From: | Critchfield J FLORIDA PROGRESS CORP. |
| To: | |
| Shared Package | |
| ML20095L057 | List: |
| References | |
| NUDOCS 9205060211 | |
| Download: ML20095L086 (796) | |
Text
THE m.,an POWER OF PROGRESS
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(% liv 5 in milhor's Cncrpt (Wf shtte tystounM Annuai Gma th kates On peu ent) i 1990 199; 1991 19M 1%1 OPLP A' NG Rr ig(15 Utihty revenues i 1,718 8 $ 17v91 0 ?3 Dhersif ad re,enue ,(tontinu.ng) 355 9 301 7 18 0 13 9 , '
income f rom t ontinumg opeations 1745 1798 (2 9) ( 7)
Lost, trom decontmued ope rations (2 4) (15 0)
Net income 172 1 164 8 44 (1 0) owe r e.
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utihty $ 3 05 $ 3 22 (53) (2 0)
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.,. .J Dwersified .19 .28 (32 1) (10.5) :
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M,., , , j continuing operutions 3.24 3.50 (7.4) (26) LR :
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, o. G' D6 continued operations (.04) ( 29) .
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,'t Conschdated 3 20 3 21 ( 3) (2.9) .h M.,&3 ,'
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', Dividends 2.765 2 605 3.8 3.7 3 ;
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Book value 28.72 27.55 4.2 4.3
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Closing stock pnce 47 365. &
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Stoence range 33 440V2
, FINANCIAL POS1110N AT DECEMBLR 31
- Assets $ 5,024 9 $ 5.045 9 ( 4) 5.4 lotalcapitahration 3,546.0 3,605.0 (32) 5.4 Capitahration structute:
Short term capital 4.16 186%
long term debt 44 6 30 2 Preferred stock . 6.5 6.4 Common stock equity. 44.8 388 _
OTHER STATISilCS ;-
Return on cott. mon equity 21.4% 11.8%
Dividend yield .[ 6.0% 7.2 %
. Averagecommonihares
- outstanding (inindhons) E'] 9 ' 51.3 51 2.0 Employees ; V 7,250- 7.879 (6.7) (1.8)
Earnings and Dividends Per Share Average AnnualTotalReturns' u ner .n u ur % r e r w g?
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[M.E..[hM'I#H MDysvs el Eamrp h_o A 5 & P $30
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Flor!da Progress Corporation es e dwersifned vtil ty hot $ng conpany ntth essets of $5 bil-
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based Flonda (Uncr Corporatnw the states 9 :\'[y
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second largest electric utthts flonda ikwer -T ,.
serves o tbst groseng area of the country and .
has a traattrOn ofQuabtp scruct and Icm elec ,Q"
?R ' ' . , y, tite rvtes The prommy corporate focus is inbin- i-n tatnarg florrda Rmer's operatasa!and funancoal strength The dnersif<catron strategy is to in-nest in tvAinesses nhose earnings can grow at a faster rate than the utthty so h:gher total returns can tus achieved for shareholders florida Power's Area of service HyAtot47 , .,3,1~,- 3 pg.yg
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+ e Florida Power Corporat6on Lloctric Fuels Corporation v;.
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(' An electric utiDty servir>g rnore than 1.1 milhon A coal mwong and tronsportation ser uces com Vs customers in 32 of Flondas 67 counties 10tal pany urung circtoc utikties and endust'lal TD Stdvitt Art a wvpfwe e ik capacity cu eeds 7 milhon & powatts with an ener- cornpanien Clettric fuels' mejor busincues in W An MM i #0R$e =' '
gy ma of 50 pertent coal,17 wcent nudear, dude cool mining. piocure ment and transporta ti il D percent oit,1 percent gas and 10 pert er't nur tion. bulk ( omrtiodst 4 5 transportatgri and radc ar y ,
chased power Retad kikwet ho n baiemcrea! ed and manne rett . hiser. Unregulated buser.ess
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an overage 4.9 percent donng *he Int five year now accounts for about one ha:t of earnings Y ~$ V'"*0 Site relatise to consolidated company Flonda Pomet nerves custws t,MAbe Site relative to consolidated e unpany a Anets $280 mahon - 6%
com arv ht t c !es e$oJt 20M swe rwes we a
.h . m hsets $3 643 bsnion - 73%
m ,veier>ues 51729 tinkon - si 4 a henues W rncon - p, m f amsngs $80 rnshon - 5%
popdation Of tho't thaq 4 4 Imbic4 m Larnings $164 J mahon - 95%
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' ,, , %44Jin Corporst6on Advanced beparat60n fathnologies A ste ( s. tate company with projects im eted an incorporated
, ,) honda talautri ponopd red e state holdinp in A rebeaq h and dea lopment (ompany atmse
'l* clude llorida Progress' hea lauarters hudding. plancipal prsdixt ib a petentt d aisorption tet h b , , . [\ noioRy Ceed ion Sopwation {l5[ h the prod I gg sj ' g ,
d apar tmtmt t ompleaet N e tiudd,np,i?'d and c ess tle; sded toe cy uit rene eb dissobed impunties and makes a By 1 't lifecwe teciltes f lund Clicht naturt of the toai e- t busintws does not t bengi se p.oations in a t-ontinuous piot eta prondt a btream of stead, carnings for inc reas lhe technutogy has t t en romkett d and sold to
- ing dividend grow th 1Moum will t t u ns asse tm as food peotesws. t henw al rnviuf acter in and it al estate inrRt cond:tions improve ferINet compants Slie relative to consolidated comparry e
N Assets $210 memon - 4%
8 Hewnves $17 matrun - 1%
N tours $6 6 m>*on - (4M Mid-Continent Life insurance Company Progress Credit Corporation A bfe nsurance c oropN ry. beadquartered in Okla A tend:ng and leas ng buuness eth financing ac-homa Ctty, serving customers in 37 54ateb through twit ies pomarity in commerr ist ancruf t rem et tato more than C000 independent agents Mid- proiects locomotives and meo cai equipment . .
Continent s ponc4al prodact is a low premium flonda Progress deoded %v p pMh of its finw ic e death benefit pol (y A" quired in 19BC. Mid subsidiary reymres too Nuch of a capdal(om- E Continent has increar ed e ernings an average of mitment at a tiene when tne company needs to investor %hyhts 24 percent annually Ra'ed A + Supenor tn A M supputt flonda Power % constructson omgram.
Dest, a prominent 6nt'rance rating agency, for 13 Progresa Credit plans ta seliits ussets in an or U ;
consecuttve years derly manner as market cond<tions truprove. Letter to Sharch0Uerb Site relatise to consondated company $lso relathe to consohdoted company i O Assets $187 mdhon - 4% 5 Anets $669 motion - 131 int nuew with E secutives G Revenues $63 milhon - 3% nnevenues $15 mdhon - 4%
D farnings $75 muhon - 4% 5 Earnings $8 4 mdhon - % D Utitty Operations D
Diverstfled Operations
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Managerpent's D$ cuss 6cW~^4 3 "'ond Analysis ,
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Management's Report?..
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Florida Power Corporation"?
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investor in.brmationa
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LETTER TO SHAREHOLDERS Dear f ellow Sharenolders' tend to keep florida Power Corporation stfied operations in September. we decid-strong.oporationally andfinancially Appror ed to begin an orderly withdrawal f rom the irnately $100 nuihon of new cavity capital co imerciallending and leaung business 0 ur corporate strategs emphasilesthe steady and long term growth of our businesses Byma>ntainingthistocus.
we will reahre the full potential of
- D5 invested in the utihty during 1991
'T he ibwer of Pr ogr ess" atso r epret ents the cotiective contobutions of our dwerst-And rec ently. v.e ac c omphshed another strategic goal when, in January 1992, we sold the two remainmg operations in our
- The Power of progress 7 the theme for our fled operations Our corporate strategy in but'd ngproducts dwision T hree other build, 1991 Annual N lef t to Shareholders cludes expanding the energy related ing f roducts operatit,as weie sold in 1991 l am pleased to report the compan) s operabons of our coal and transportation An increase of $2 4 nuihon to the onginal board of d. rectors increased the annual div.. business and maintaining the ste ady. pf ofit- af ter tax loss reserve was required DS a re-dend rate on common stock to 12 84 per able growth of our life insuranc e cornpans suit of the sale of these five operations share. up 10 cents or 3 6 percent cner the We behew e. Wer the long ter m. that our dwer-- T hese lmnsactions complete our eut f rom previous) ear This marks the 39th consecu- MI'Od C'PC'dh0M Will ihC'Od50 th0'r contn- this industr y We continuc ef f or ts to sell our twe year the company has increased d vi. bution to earnings growth in turn, flonda real estate hold (ngs dends paid per share - a track record that Progress wili be able to offer a Inore c om These strateg,ic changes in our dwersi ranks in the top 10 of the more than 1.700 petitive d.vidend groath rate and higher f eed operations ultimately should allow us c ompanies listed on the New York Stock E ,. totai returns for shareholders- toredeploy capita!toother areas Moreover.
Change The d>vidend ancrease reflects the We also have taken further steps to these moves help estabbsh a firm founda board's c ontinuing confidence in the f utur e stenmhne and restructurc our other diver- tion f or improving f ut ure car nings and long-of florida Progress Corporation term profitabihty in 1991 we moedforward with ourlong. :n 1991, flonda Progress reported earn term strategy of inMting in our core elec- ings from continuing operations of $174 5 inc utihty business as well as focusing on rnilhan. 2 9 percent lower than the $179 8 a fcw select diversified businesses We in- nithon earned in 1990.
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florida Powerb carnings were shghtly flonda Powe is taking the necessary These achievements are expected to lower largeh because of add.tional annual steps to improve caerating results in early strengthen our uttht3 's operations and im depreciotion expenses and higher operat- 1992, the utshty f ed with state regwator!. prove financial f esults lng and maintenance costs a request to colle:t $1459 minion in adde ()ur stock price continues to benefit f rom On a comparative basis, about $4.3 mil. tional annual revenues. The requested in- an uncertain economy and low interest rates.
lion of the decline in Flonda Progress' con. crease in base lates - the utihtyt first in i hr company's totai return in 1991 was 31 1 tinuing diverstfied earnings was due tu the e'ght years - is needed to recove' higher percent Dunngthe year.Our Stock pnce rose s6ie M our citrusoperationsin 1990 Aweak expenses and costs associat(d with meet- steadily, ending the year 61 a closing high coal market in eerly 1991 and deprest.ed real ing customer growth and inflation, f utute of $47 per share estate conditions were also poncipal rea- growth in earnings will depend. in targe part- In November. rionda Progress made a sons for the decline on this rate increase- number of key management changes Our electric utibly accomphshed sever- designed to provide a f ramework for succes.
Stock dilution also contributedio the de-al strategic goals in 1991. Flonda Power. sion in the f uture. T hese changes included chne in carnings per share f rom continuing operations which dropped from $350in the appointrnent of Richard Korpan aspresi.
M Completed a detailed plan for meeting 1990 to S3.24 in 1991 flonda Progress is- dent and CrUef operating officer of florida energy needs of its customers in the nex t Progress t will remain the company % chair-sued 2 9 milhon shares of new common 10 years manandchief executiveofficer Mr.Korpan, stock m May and the company sold anoiner g 650.000 new snares through its dividend who was previously executive vice president p1 nt complex.
reinvestment and stock purchase plan. Net and chief financial officer will overste the proceeds from the May stock sale were M Decidedtouseclean burntngnaturalgas activities of our vanous operating groups, added to the company % general f unds and along with a combined cycle technology Sirce joining f'onda Progress in 1989, he were used primarily to provide equity to in the first phase of the new energy has demonstrated leadership strength and Flor da Power. The utihty will use the equity complex. a keen knowledge of our businesses.
capital to support expansion and future M lookadvantageof favorablemarketcon- T hree board members are retinng in Anni constructiort ditions to issue debt at low interest rateE 1992 when their res :tive terms erpire leavingthe board art t e H. Scott. Corneal e B.MyersandDr.RobertFMnzillottt. Adirec<
tor since 1984, Mr Scottis a former florida Progress officer who retired in 1990 af ter 40 years with the company. Mr. Myers has been a director since 1978 andDr Lanzillotti joined the board in 1991. All three individu-afs prcreided valuable guidance and insight.
Profiles of the company's board members appear on page 48 of this report. InformF tion on nominees to the board is contained '
in the Proxy Statement for the 1992 Annual Meetir g of Shareholders.
., MTo you, our shareholders, i express my 7 deep appreciation for your continued support. We look forward to the future with great confidence On behalf of the com-panyt board of directors, rnanagement and all the employees of the Florida Progress .
- companies, thank you for believing in "The Power of PmgressT'
- ~
Dr[. lack Bl Cntchfield m., Chasrman and Chief Executive Officer =
A February 5,1992
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9 i l lNTERVIEW WITH EXECUTIVES a :
$ ppN.t '4 What do you think are the major Qwg j
_R chaHengn facing &ctric ubHHH in Mg;b.>' <
y Florida?
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( Keesler: Among today's major chal.
-M $ t 4 'enges ale: balancing service reliabib-1 y#f , f .I .'#
.'b ty with the cost of service. Completing s
3
., the necessary requiremerits for build-ing new power plants. and satisfying hLa f.ection o' t annual report tighter environmental regulations j features a pnuon a id answer dis-
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j cussion wu Wul of the cos.ipany's . .
er ecutive officers Ilow ls Florida Puwer preparing to meet these challenges?
.Ichard Morper , Prt ude nt and Chier opera ting orricer, rioride Progress corporothm Koester: We take our obhgation to ser ve Florida Progress Corporation han reported a decline in earnir.gs for the g gg g past f ew years. What are your expecta- g g In 1990 and 1991. Florida Progress tions for improving earnings in 1992 sty to meet f uture energy needs T his will made a numberof changesinits diver
- and beyond? t>oost our reserve margin to a more sined operations. What role will dive *-
comfortable range But,we also realize sification play in the future?
Clorpan: We beheve the nation's econ- the importance of carefully planning,our Korpan: First of all, we are still comnut. new capacity needs ' tis nct re asonable omy will not improse significantly in led to dive'sification, VNil focus on a te require oor customers to pay the year-1992. And, since many of our vperat.
- ing companies are directly af fected by few select busmesses - busines
- es roundcostsof additionayenerationto that can achieve higher returns than if meet inf requent winter demand levels.
A the prevailing economy, we don t antic-l ipate much earnings growth in 1992. w nh perated an electric utihty. But florida power has started the lengthy our strategy for diversification will be piocess for building more baseload A number of conoitions has affect- conservative. Our equit) investment i" ed our company's earnings in recent gcnerating capacity Wese developed d, versification will be hmd ed to no more years FloridaPowercustomersreceived a plan that is operationally ef bcient, than 20 percent of our total a large rate reduction in 19853 and the cost ef fecuve andenvironmentally sen.
[ A tep pnoritv lor usis to conthue im.
utikty has not had a f ull rate case s;nce sitive. in f act. we have t ehcted a site in I piementingourdwestituredacisions To Central flonda that is pomarily mined-1984. Higher depreciation expenses ,
mprove dwersified returns, were sell- ou' phospnate land. '
have not been recovered through elec-ing our real estate assets And we're l tric rates And increases in other "'W "
experases as well as new investments reducing S < a of our lendmg and
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are not reflected in current rates. In our
, easing porMio to strengthen out V financialposition. Inthemeantime well other operating areas, the lagging econ-omy has slowed our abihty to restructare M om W nW M our diversified operations. r abon opaMs and m* Me iQ, . "h ,
nsurance company- allof which havo n However,weseesevera, a rs help- proven profitable.
ing to position us for futuie earnings U$
growth. Florida Power recently fi l ed with Long term, we'll consider entering a s regulators for rate relief in 1992 and new business field that offers high l 1993. Construction investments for growth potential, possibly in the water b]i technology area. Any new investment new facihties will be added soon to our Inust meet our primary goal for diver-utthty's rate base. lf the economy begins to show signs of improvement, which s fication, which is to contnbute D !ong-term dividend growth and higher s ex pected iater this ycar, it should have a positive impact on our diversified returns for our shareholders.
Ancn l. Heewer fr Preudent ed chner operations. E n n Encuttst orricer. TIorida F\mer corporation >
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,g y to set goals and select strategies that long term view when formulating our wdl create a bng term competitive dividend policy. Over time,it is our goal advantage. for the payout to be in the 70 to
, 75-percent range l For example, by ftusingon creating a competith e odvantage, we have dra- 11is acceptable for our payout to be
- lj L above this range for the short term if
%> ; maucally enhanced our method for investingindiversifiedbusinesses This we expect improved earnings. Two key i method will assure that our future in- factorswilldeternuneif we canachieve dustry and acquisition decisions are our divideno growth and payout goals.
, appropriate for a utihty based holding whether Florida power receives the company This same approach ts used needed rate rehef in 1992 and 1991 in all major capitahnvestment decisions and at what pace we're able to execute and was just used in the important our diversification strategies.
Joseph r. cronin, necurhe vice Presloent 7:'eneration planning decision at Flonda flortda Prcgress Corporation 'y*.* '- -
The common stock of Florida Progress Strategic management aise has has been tradingin the mid $40 range Environmental awareness continues hdped us make key decisions in re- for several months. Under whrt condi.
to play a major role in how we run our focusing our diversified operat.ons tions would your company consider business We've atready takenimportant splitting the stock?
steps to protect our state's environment How have your employees responded to the new management procets? Kuzma:lf our stock continues to trhde and preserve its valuable natural in the mid. to upper 540 pnce range, resources. For etample, several years we're likely to recommend some form ago, we bcgan burning low sulf ur coal Cronin: T be process has been very weil received. It has provided employees of stock split to our board of directors.
in our plants which heiped reduce sul. it should be noted that a stock spht, in furdioxideemissions. And.inthe years with an environment for contributing and of itself, does not increase share-to come, we plan to meet tighter stan- ideas and solutions. More levets of holder wealth. Our decision to spht the dards in the Clean Air Act,in large part, management are now involved a mak, stockwouldbnng our stockintoa more by using clean burning natural gas at ing key strategic decisions. Were tap, pir'.g into the talents and wisdom of all popular trading price range and in-our next energy complet crease the hquidity of our shares m the company esperts, not just senior At Florida Power, one of our strategic marketplace.
officers-goais is to be recognized a s an environ-mental leader. We'll continue working All employees can benefit irom this hard to deal effectively with all thec.e process because it helps them better challenges -in ways that balance the understand the issues and why parti > .
interests of our shareholders and our ular strategic decisions were made Em. , f I s... 4 customers. ployees can be more oroductive in .
'E 5 5 h achieving goalsif they understand and d: .' -e share the company's vision for the .
{ '-
Several years ago, Florida Progrese future. 9 beganusing strategic management as E N 31 O c c.he piocess for directing the company
+
[', '
and its operating units. What has the f ,
company accomplished through this Your current dividend payout ratio is ' ; ..
process? 86 percent. How does that impact the .
Cecnin: Clearly, the process has im. company'a dividend policy and objec- .. y '
proved our decision making by requir. tive of maintaining an above average f1 Ing us to think more strategically and dividend growth ratc? l .;g - ~"
to challenge existing plans and past Kuzma: Investors wbo own hight vality n
decisions. It pulls together all the utility stocks ex pect steady. pre &ctabte disciphnes in the organization in order dividend growth. Therefore, we trw a Enk%MN',$,'d'#[,'c"[,*p'[,[,$'n' H
3-
U TILIT Y O P E R AT IO N S ut simply. Florida Power .
13 A n -' ' n 'uman Corporation is1 he Power of ',',[,' y , '; *','
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Prepresents more than 70 p Progress: The electnc utihty Florida Progress Corporation's total assets and will continue to be the h" g .O a-
./
f tr:
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new eum nunty ute ti,e data is used to tortnorore a ba*"'e fo' encosuong the
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company 4 primary business for many m %lI"}
years to come. j m4 7
"The Power of Progress" also de- } }g jf , 3 scribes Florida Power's commitment to serving the future energy needs of its a customers T he utility operates in a r. tate ES <4 that has a growing population. Florida #.
.; Q " currently ranks ',s the nation's tourth "" ~'
"enewb.M"
'O gegM'W h most populous state and it continues to attract new people and more bush N
wr : o a ii ND;L
%3W r esses About450pooplomoveintothe :
state every day T hough the country re- N' i #%"
mainsin an economic slump, Floricas Y '
M_ i econottry continues to perform above - fag 7{ -
.,o gaq'p d g
- the national average. , 1 y Providit:3 net ablo service to Florida's - fM-growir*g p9pulation ~g N_42ng
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Florida Powcr has proud!y maintained DW- W > "%e
, a 97 year tradition of providing riorldl. M "~"' ;;p[* T@*M"Y h ' N"b fps with retiable power at a r ea sonablegg cost. And,the utility has achieved thatM 7 balance dur6eg persoos ofsigNficant i ?
%growthi Today,L Floritim! FNmer '6s' the L
/ statetsecond lwgoat electric util6 lyn S with rnore than 14 flitlBon sustoment @
' Since 1986, its customerfgrowth'ratei Jhasswweged3Apercentannually.near s Lly.twa the national awroge sSomo
- partnot Fionda PowerW3000+quare @f .
> mileareeWservloearegrtw#ngatrates;
? newty tyee thes thy net 6onal everage. . . -
,.3 Recwritty, howeverl thf utility) cusR[
Mtomer growth rates haveLtiowede inA
%991,theaveratenumberofbatomeW jinits system grew byMpercent ovet phe year taefora Thwgh this percenW ,
,g age 6s wa above the nat6onaundustryk overage of M percentfitla Florida 5 ,
k Powett kwest customer gmwth ' pen ~
l centage since 1976cWeak economic Y
!condit!9ns continue 16be tha ~p* ' yj
r6mm "
Ecarse ofthis decifne.EM y
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f Q Severre dwen wells are Instetted ,neset the '
I Pufk County site to monito, groundnaterr .
tevels p Q Losing sorar squipment, a surse; crew
..; a takes readings that will hefp setord the
' bottom elevetton et s pond at the Volk
~
! Cos':s site. I Y (*, in south Volk County, er ensirpomt n.'al ..
project rnanager from florida hmvr .,
1 Yz ,_i *
- s>~*lrTY ^lR] meets with an environmental consults nt ild" lN$_'q ?5"' v; to dlscuss her ideas for planning flortce
- Power a nest major energy comp'en. 30* lY Y;v o
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Despite the slower customer growth . Each combined cycle unit will be figures. Florida Power added nearly --
i .
' capable of producing 235 megawatts 24.000 customers to its system in 1991, l -
s . of power, with the first unit scheduled
~~
which helped contnbete to higher ener- 4 'i for completion in 1998. When complet-(p .
gy sales T he utility r ecorded retail sales #
ed in about 20 years, the new complex of 25 2 billion kilowatt hours in 1991. - ' . , e in Polk Lounty is expected to produce about 31 percent more than in 1990. almost 3.000 megawans. making it in 6ddition to higher sales. Fionda F%er * ; equivalent in capacity to Flonda Power's customers teached a new system peak '. Crystal River Energy Complex - cur-dernand of 6.983 megawatts on Janu- .
rently the state's largest puwei piant fa.
ary 17,1992. .
ciley. T he utility operates four coal-fired Customers in the more populous l .
' . units and one nuclear-powered unit at parts of Florida Power's area of service '
Crystal River.
can now call 24 hours2.777778e-4 days <br />0.00667 hours <br />3.968254e-5 weeks <br />9.132e-6 months <br /> a day to ask ques- rioNdes summer thunderstorms treguenny
- crude r, cree ughtrong straes that can Florida Power selects natural gas to tions about their accounts. At the end of 1991, nearly 90 percent of the cus- deson une ovipenent mening is M new um in M he une or the primary causes or sorrice The new combined cycle units will be tomers Florida Power served were interrupuons fo rlonda rwer customers fueled by neural gas because gas residential accounts. A high residen.
group because it balanced environ. represents the most cost ef fective fos-tial customer base means the utility s business remains targely constant and mental and economic concerns with sil f uct available in the foreseeable fu-Florida Power's engineering require. ture. Flonda Power will be able to take stable dunng a weak economy ments. Also, the site is centrally locat- advantage of beinglocated near exist-Flonda Power estimates its custo' ed in the utility's 32. county service ing well fields in Louisiana, Mississippi merswillneed 50 percent more energy terntory and is adjacent to existing and the Gulf of Mexico. Natural gas is in the next 10 years Preparing for that expected to be the cheaput fossil f uel transmission lines.
growth requires sophisticated planning source when compared to other fuels Flor da Power began the tengthy pro.
andsensiblesolutions Theutilityplans in terms of plant cost, etficiency, emis.
cess of seeking regulatory approval to to meet tomorrow's load growth by us- sion control costs and overall cost per build the power plant complex, in ing a balanced mix of several environ-August, the utility f i led an application kilowatt hour. And because it burns men' ally sensitive and cost effective with the Florida Public Servic; Com. cleaner than coal or oil, natural gas will
'"b0#'S~
mission asking for permission to build help Flonda Power meet tighter air The strategy . includes adding new new capacity. quality controls under the Clean Air Act es pacity as well as employing a series of 1990.
Plans for the first phsse of the new of energy concervation and load complex will incluoe constructirsg in December. Flonria Power signed management programs. These energy a letter of intent to negotiate a defini-combined. cycle units, one of the most efficiency programs are part of what tive agreement for natural gas transpor-efficient and economical designe for {
the electric utility industry calls power production. Combined cycle tation to the new Polk County site. Afinal demand side management.
merges the technology ol a combustion agreement will be contingent on ob-Adding new capacity to meet growing turbine with conventional steam. cycle taining alt regulatory approvals, financ.
energy demand production. To increase heat rate effi. ing and commitments from other Florida Pc ser plans to add more capac- ciency, waste heat from a combustion customers sty by building new peaking and base- turbine is used to power a second tur- T he supply would come from a new load generating units; purchasing bane after it passes through a heat natural gas pipeline, which would ex-power from neighboring utilities and recovery steam generator. tend from Florida's panhandle to the cogenerators; and building more bulk The combined cycle design was central part of the state. Part of :he power transmission line capacity in selected a 't a best option because it new gas supply would be used at Flori-the state. hasle" icosts. greater phnning da Power's Anclote plant near Tarpou in 1991. Florida Power announced flexit .%.ier efficiency and lower Springs, currently fueled by oil.
plans tc
- uild its next major power plant enP ins than conventional coalunits. Fionda Power selected the new pipe-complex on an 8,000 acre site in Cen- T he units can be casily modified and up- Ime because it will of fer operating flexi-tral Florida. Located pnmarily on mined. gradei as load growth projections and bility and will bring a second major out phosphate land in Polk County, the f uture capacity requirements become source of natural gas into the state. In site was selected by a citizen advisory more certain. addition, the owners of the planned D
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capacity. Flonda Power needs the kne .
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to assure greater setvice rehabihty and ^
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to provide access to low-cost prchascs
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- and emergency power.
Florida Power a!so is meeting load
'h ( 3 4,;
' ". = "p' growth with a number of small pur.
- - ,, - g
" J I chases from non utikty sources. At the
. p' 9 cQ^ ,3 y V enti of 1991, about 178 megawatts of ..
l j
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-.7 . . . . cogenerated power was;a servt .and -
j@ -
,L. .,;. F60nda Power has committed to in- # '.
3L, 4.Vl C crease its purchases to 1.095 mega- ,.
'l ' ,
watts by 1995.
g.,C' . . t- -
- / . - 4 Currently Finrida Power has pur- l E - .
At flottaa Power, taiephone center chased more non utthty generation Prompt responses by riortoa Power s hne representattu s arc avaHabfe 24 hours2.777778e-4 days <br />0.00667 hours <br />3.968254e-5 weeks <br />9.132e-6 months <br /> a day crews help the utibty mamtain high sersice to handle service requests and answer than any other investor owned electric rehabHity standards quest /ons, as well as to report outage utility in Florida. Florida Power believes mformation so hne crews can *)e dispatched too muCh cf this type of generation pipehne have access to major sources cocid weaken operatior71 ef ficiencies Florida Power's nationally recognized of natural gas in the United States and and thrcaten the utthty's high standards load management program celebrated l for rehabihty The utihty does not plan its 10th year in operation in 1991 and Canada.
Until new baseload generation is to exce editspresentievelof purchased is considered one of the nation's best neededlaterthisdei ide FlondaPower power under contract. Relyingtoo heav- 1or controlling peak demand. Mo e than will use a variety of resources in the ily on purchased power can impact a 370,000,or aboutone-th;rd of theutili-mid.1990s to meet increasing energy company's financial strength and could ty's customers are subscribers.
demands. Eight combustion ;urbine result in lower debt ratings by the na' Load managemcnt reduces electnc-Units, capable of producing a total of tion's credit rating agencies. ity usage during peak-demand peno 's.
l 728 megawatts of power, are undo con- g g ., which helps the company postpone the j struction and schedule'1 to be in serv' lergest load management program need to build new generating capacity.
, icein 1992 and 1993. These new units. Florida Power has pioneered the deveh Customers participatmg in load l commonly called " peaking" units, will opment of severalprogramsin demand. management allow the utility to install r
help Florida Power serve its customers side management. Innovathe and special devicec that co: al major duringperiodsof highenergyuse And, aggresshe are words that descnbe household apphances, including air-after upgrading the performance of Flonda Power's energy efhciency pro. conditioning and heating systems, wa-several of its existing combustion tur' grams, allof which are designed to help ter heaters and pool pumps.
bine units. Florida Power gained more custon iers use electricity wisely. These When Florida Power's system
- power output - adding about 125 programs - offered to customers un- reaches high levels of electricity use, megtwatts to its system capacity. der it'e name Partners In Energy - radio signals are sent to temporarily l A balaner,d energy mix includes strengthen Florida Power's position as interrupt power to the selected appil-purchasing low-cost power a leader in the electnc utihty industry. ances. In return for pa ;icipating, New capacity has been added by pur- Almost 30 percent of the utihty's customers receive monthly credits on chasing 400 megawatts from The projected load growth will be m^t their electric bills. Flonria Power re-Southern Company. Tt r- purchase is a through demand-side management. covers the credits through an energy firm enacity contrad ahd gives Flonda When Flonda Power estimates future conservation adjustment in its electnc Power a low-cost, reliable source of coal- energy demand, the utihty first con- rates. Today, more than 700,000 major fired power over the next 18 years. siders capacity sa
- .ags from its appliances are connected to Florida And negotiations are neanng com- demand sioe management programs. Power's load maragement program. In pletion for a new 500,000-volt trans- These savings, expected to be about the next five years, most of the energy mission line to connect Florida Power 2.375 megawatts by the year 2000, are savings in demandede management with electric utthties in the Southeast. .;btracted from system load projec- are expected to result from the utility's The new ! ne will have the capability of tions The difference is then used to load management program. Florida importing 0$0 megawatts in 1997. With determine how much new generating Power earns a full return on its invest-existing tie-knes to the north neanng capacity is needed. ment in toad management equipment.
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By 1995, Phase I of the law will kmit M
,j f' ;,
electric utikties to an annual sulfur di-Oxide emission leml equal to 2.5 lbs. per %'
million BTUs, multiplieu by the average
' ' l.
. fuel consumption from 1985 to 1987.
~
Because Florida Power already burns +
- ow-sulfur fuel, Phase 1 of the law will ,
. =;
have no impact on the utikty. ,0g i Further reductions in emissions, yff required in Phase il of the law, must be completed by the year 2000. Florida %g % / 4
, Power selected clean burning natural 7 % y '.
gas as the fuel for its planned energy
.4 complex in Polk County, in addition to -
A unique type of devtce, called a " blower #'
- door: pressurites a house so a florida meeting Customer growth, the neW
- Y'"' #""*'
rhomicalis roptayed into a home s central Power energy specialist can detect ok leaks Complex will help Florida Power meet dactwork to tut for air leaks.
In a hon.e's duct system- Phase 11 requirements without any sig-nificant capital modifications to its ed one-third of the average customer's Florida Power also teduces peak de- isting generating units. Also, the utihty's electnc bill.
mand by controlling load to some of its older power plants will begin but ning a Operating power riants efficiently industrial customer that use large c:eaner. lower sulf ur fuellater this dec- also lowers fuel costs and cuts operat.
amounts of electricity. These custo. ade. These changes are not expected ing and maintenance expenses. For mers rtsceive lower electric rates in re- to nave a major impact on the com- eight consecutive years. Flonda Power turn for allowing the utihty to interrupt pany's annual fuel expenses, which are has ranked in the top 10 among the s ervice to their businesses during peri- recovered through fuelcharges on cus- nation's 100 largest investor. owned ods of peak demand, tomers' electric bills. electric utilities for fossil steam unit Flonda Power offers 22 energy effi' "E * "4 ciency programs for its residentid and Able to offer low electric rates by controlling costs Nuclear plant has strong commercial customers. In 1991, the Flc ' a Power continues to of fer its cus- performanco in 1991 utihty began offering a new program tomers electnc ratesthat are among the Fionda Power's largest power plant -
that helps identify costly air leaks in lowest in the Southeast. The utility the Crystal River Nuclear Plant - con-central heating and cooling duct sys- maintains this positic>n because, over tinues to carn praise f rom federal rego-tems. After a Florida Power representa- the years, it has managed to hold the f ators for improvements in overall plant tive performs an energy audd on a bne on expenses. In every phase of its operations. In its 1991 review. called house, a technician uses a unique fan expanding business, Florida Power Systematic Assessment of Licensee device. Called a " blower door" the de' works carefully to control costs and Performance, the U.S Nuclear Regula-vice is attached to tne customer's front develop new operating etfaciencies. tory Commission gave the plant superi-door. It pressurizes the house so Florida Power's operating and main- or performance ratings in four of the morutorirg equipment can detect air tenancecostspercustomerhavebeen seven areas evaluated Plant opera.
leaks in the home's central ductwork. thelowestof thestate'sinvestor. owned tions, emergency preparedness. radio-Claan Air Act to have minimal electric utikties in four of the last five logical control and secunty all received impact on Florida Power years. And the utihty s balanced mk of Category 1 ratings-the highest rating.
Florida Power will not be affected by several fuels helps control fuel eo Engineering and technical support PhaseIof the Clean Air Actof 1990and nenses.Usinga combinationof fuelsto were rated " improving" in Category 2, the utility can meet the law's Phase 11 iroduce power means the utility can considered average for the industry The requirements with ooly minimal capita! linimize the impact of dramatic other two areas - maintenance /sur.
modifications to its power plants. Part changes in the supply and pnce of in- veillance and safety assessment / qual-of the new law, which tightens the dividual fuels. ity assurance - also received Category nation's air pollution control standards, in 1991, Florida Power's energy mix 2 ratings. No areas were placed in Cate-requires electric utilities to reduce emis- was 50 percent coal. 22 percent oil,17 gory 3, the lowest in the rating scale. In sions of sulf ur dioxide and nitrogen om percent nuclear.10 percent purchased the previous review, the nuclear plant ide, or acqu;re allowances to meet power and 1 percent natural gas. The had superior ratingsin three of the sev-emission limits, ut;hty's f uel expenses account for about en categones.
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i T he 875 megawatt nuclear plant also The entire organization is committed to reported a strong performance for 7 '[ raising environmental awareness and 1991. It generated 5.5 mdhon megawatt- gy action to a new leves Throughthededi- l
} cated etforts of its employees. Flonda hours, enough power to meet the elec- r j tricity needs of 1 million homes for more Power already has eained the reputa- I than five months. During the year, the tion of being a respons,ble leader in its plant operated at 76.1 percent capaci- industry ty, well above the national average for -
. :( j Over the years, Florida Power has in-nuclear plants d statuted a wide range of programs that Last fall, plant of f acials completed a c preserve natural resources and protect i planned maintenance outage intended the environment. Since 1983/he utsh-to increase the nuclear unit'slong term ty l , s burned high-quahty, low sulfur performance and prevent unplanned coat in its power plants. which helps re-forced shutdowns. The outage was the Resurs from the ' < door" test are duce sulfur dioxide emissions And re-first of its kind at the plant and marked (([3,[, ', C[7f[c',",'e re ,,, cently when Flonda Power announced thebeginningof regular mid-cycleout- lens eust and what is needed to correct plans to build its new energy complex ages so named because they occur "" P' ##* in Polk County, the utihty decided the l
' midway between refuehng outages ev- tate 1992. Four peaking units, capeble new units will be fueled by clean burning ery two years The plant operated at 92 of producing 364 megawatts, are ex- natural gas l percent carac:ty untillhe midfycle out- pected to be placed in service at that Constructio1 continues on a massive
! age began. The plant's next refueling time- water cooling system at Crystal River outage is scheduled in the spong of Another phase of permanent rate re- des,gned to cool salt water flown ii; f rom 1992- hef, totahng $37.8 milhon, is needed in Crystal Byer Units 1,2 and 3. The sys-1993 when Florida Power is scheduled tem includes four rectangular-shaped Florida Power seeks rate increase in 1992 to complete construction of a $90- cochng structures - each measunng in January 1992 Florida Power filed a milhon cochng system at Crystal River. 500 feet long and 50 feet wide. All four petition with the Florida Public Service Beginningin 1993. Fionda Power neeuw structures occupy an area about the Commission asking for $14 5.9 milhon to f ully accrue for retiree health and hfe sizeof eightfootballfields The project in additional annual revenues. The pe_ benefits in accordance with new ac- also involves modifications at Units 1 tition is the utthty's first request for an counting standards. Also in 1993. con- and 2 to reduce cochng water flow to increase in retail base rates since 1984, struction of another 364 megawatts of meet tighter environmental require-Flonda Power's last rate decision, in ne & peaking capacity will be complet- ments. The water cochng system is ex-1987, resulted in a rate reduction of ed ad pl cedin service. A decision on pected to be completed in 1993.
the permanent rate request is expect- Also at Crystal River, Florida Power
$121.5 mihion.
ed in September 1992. recently completed construction of a Florida Power needs the additional revenues to cover cost increases and F%rida Power also anticipates fihng new manne ha'chery. The utihiy plans investments a ssociated with customer a iequest with the Federal Energy to supply the salt waters in the Gulf of growth, environmental protection and Reguiatory Commissien for an increase Mexico with redfish, spotted sea trout, generalinflation. Although annualinfla. in wholesale rates to coincide with the shnmp and other marine hfe. The tion rates have slowed since the early retail rate increase. $5-milhon facihty incluoes spawning 1980s, the accumulated effects of in- The additional revenues collected tanks and eight one-acre fish ponds. A flation have continued to increase the through higher rates will help Flonda two-story building at the facihty is utihty's operating expenses above the Power maintain its strong finarmal po- equipped with environmentally con-level provided for in current raN sition. Currently, th e utihty has received trolled r ooms a s weii as special viewing The utihty is seeking to col!ect the a double A minus rating f rom all the na- areas f or visitors and tour groups. T hese ;
full amount of the rate increase in tion's major credit rating agencies. areas assist in educating the pubhc chases The request willinclude intenm abouttheimportanceof protectmgthe rate rehef of 7316 milhon.to go into ef- Balancing energy needs with concurns region's natural manne habitat. Thou-fect in May 1992. Florida Power is esk for the environment sands of fingerhng-size fish are expect-ing fora permanentincrease of 3108.1 Demonstrating environmental respon- ed to be produced at the hatchery and million when the utikty completes con- sibihty and leadership continues to be released into shorehne areas al.)ng struction of new generating capacity in a top strategic goal for Flonda Power Flonda's West Coast.
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/ 'N Q Fbngerling size fish, measuring up to about three Inches. are released into nearby coastal waters.
Ik Q At Crystal River. marine biologists from Florida Power collect fish from one of i the hatchery ~s eight ponds
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Florida Power understar.a that wet-s land resources are vital to the state's nat-ural water systems. The utility caretully evaluates wetland resources before
- constructing new facilities in an etfort 4
to minimize the impact to these environ-Q ChHdrer' are able to seo first. OM sensitive areas hand the many vartettss of ':
Florida Power is working to save oth-fssh and other marine life et PEIY ' 'h,; :-
er valuable natural resources, too. Its FlorMs Power's Crystaf River inf
-j, g-Martcutture center. M award winning recycling program in-
. i- y:;# . d_m cludes everything f rom of fice paper to
[*N ,Nef~b,],,@,.,.M M used streetlightsJ Florida' Powet has ,
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A2 f .. , bW e s
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g.gq % - . . recyc!9dabout600tonsof papersincei
, 1989 and uses recycled paper products]
,p - T m whenever_ practical,1n/1991, the recy-i i cliniprogram celetWated saving; moral
. ' thart 10,000 trees,M. r J , i .M J FlorMa Power received'netional stN Treecwdi. a p th tantioribyM$.w{wwrou.at[
ein many carded e4 N eopper w,townspi MAlfyydelfly asnaire,a H tor oil and laser printer cartridges amY a- among other resources tho utility recy3 4 cles Recyclingthese nuterWshelpsrem 9 duce the amoJnt of solid waste going C
, % to Flotida's _landfilts.a , _.
JAlso Florida Power is' generating in? J
(.comethroughanotherinnovativerecy ,
T cling program,lt is the first utility in the ;
- natio(to opeEate an environmentally - +
tsafelncineratorforburningpaperinsu +
Tlttion off the core of discarded trans * "
i formera, The transfoimert copoer and ?
i al0minum are th6 n recovered snd sold E for' reuse? Florida -Powerf will" receive
? more'than $250,000 annually by using } '
Mhis processy lj. _ ..; g, s, (Prominent; environmental;leadersg Nwere invited to serve orf a citizen advr
% sory cbmmittes to help selhet the site]
ifo[ Florida 1 Power's1nextipower piang s complex &For its[ effort > of Tinvolving ;
Ierwironmental{ organizations,i Floridai Power receiveda'19911eadership'twardf, L from the Florida Audubon Society.The T
$dvisory committee" recommended a'jd
- preferredsiteinFcikC6untyonwhatisi 4
, inow mined out phosphateinlan'dL@[
3Employeesjkn9w;that;through N f
- ;yolvement; and ] team ve. kj tod_ay's f actions can save. tomorrow % naturall.11 Vresolarces.IN + ~ 'J - 4 Li
,g (M g[;g; i ou 3d m s A.f% ' ;, . 4 m B
= = _ _ - - - _
1 DIVERSIFIED OPER ATIONS ti naw connuo.oed et an Electric Tvels surface mine a
in eastern Kentucky
' ~
lorida Progress continues to re- '
a ,
structure and streambne its diversi-O [ *d[d g , $'hrs Os'tjaboj fled operations After making key , j pushes a full tow of barges down the Ohio River through strategic changes in 1991. Florida "##""*"
Progress plans to focus on a few select peMmq diversified operations - primarily its *
' & 2"v
, d coal mining and transportation busi- 4-
' ' ~
< ,q ness and its life insurance company. ..
9 l When combined, these operations help l ; -
1
{; 7 '
~
strengthen "The Power of Progress" ' o
- They work to achieve higher earnings ;, j ffhih]
g5kg growth and greater returns for Florida - ~
Progress _ shareholders.
s
- w ~
- i f( Elect'ic r Fuels Corporation
$$ To help accomplish its future diversifit .4 N#"* cation ggts, Florida Progress will con , , b,
- l
, tinue, ,frivest}ng in an.d strengthening:<
,a. .
its coal ond transportation operations.c.,~E .];
-(
Ely ctricFuelsCorporation,asubsidiaryy p 3-
> since 1976, has demonstrated an abillG
. tylto 'capit'a lize otYits lhv5stmedsEltU 7, biiilt3profitableheratjogbyj ;e n; h pq0r)dindinto busiriesses thatQ Qil J..
Fjlate(clossly [$$bNbdrMand L -
- transpoftatfori% ) =j ' . , JU
-x m . m e-
$F2W4h , operations :fiow--in31; state $, j h Electhd Fuelsisin6sdth chal mirdrig%
alIahdwakeftransho$ti6n railcdhnd ^ p 6 ) barga repair facilities and transloading c~
iserviceEElectrier Fuels represshia(O d stratek.icfi,tfo'ridOlsifi gy
-x m t st(),, ..a 3 =.P !Q-
&' frft'hemid-19$0is,ElectricFuelsem-~j??YNW %%!l+N8% $
' , (b'arked on an expansion ^
program that.
" included acquiring groups of eriergy-1related businesses. Since 1985, the '
company has investsd $81 million in ac-; ~
- quisitions and another $86 million in im .
, ] proving and maintainitigits operations;-
[As a resuit, the company's net incomel
' i from continuirig operationsincreased3 +
~
y from about $2.6'million in 1985 to $8 J Iimillionin 1991 ma, i u z <
l l
,m .
(fr
^
Q At a river terminalIn Maysville, Kentucky, low wlfur coalis loaded into barges, owned # "
~ * ' ' ' ~ ~ ^,
by an Dectric fuels subsidiary.
g jMM f
E l
9, p O from the towbaatt pilot house. a river
& captain maneuvers his tow of 15 coal barges down tho Ohio River.
um Il'[h\$bi 3 .:
{j
~
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,-gig;
,m , n.; ,cf ' ,,, . n gt au --
- A
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p!*]. ( -
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, . ;c? sum yr ';g -
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d 1 l4 pa M ,
E
Mining and selling coal remain the p
! AL Ni .
- South of New Orleans on the Missis-mainstay of Electric Fuelf business. In . .
. y sippi River, the company alco is part 1991, the company sold more than 10 -
. ownerof adeep waterterminal.Theter-million tons of coal, including 5 million , .
minal is a large transfer facility for bulk tons to customers other than Florida , i products and it provides valuable ac-Power. Among these customers are oth. # cess for ex porting c oal to international er electric utilities and large industrial ~' '
w' markets. In addition to transporting
} coal, the company's transportation net-companies, work carries dry bulk cargoes such as grain produc's. f ertiliz ers, saits and iron Serving coal needs of Florida Power ores on the Mississippi and Ohio nyers and other major companies e and the Gulf of Mexico.
General Elecinc, General Motors and -
T Eastman Kodak are among the indus- At corbin, hentucky. a machhe operator Expanding transportation network trial companies Electric Fuels serves. rep 8'r5 whee's fror rancars to improve service _
lts unregulated business has account' The company's inland manne subsidi-ed for more than half of its total earn- ary acquired 15 new river barges in ings since 1989. Though earnings from Coal sales to Florida Power are ex- 1991, bringing the total number of this portion of its business were lower pected to remain cor.stant in the fore- barges it operates to about 350. Elec-in 1991 because of weak economic seeabie future becaase of the utikty's tric Fuels also owns more than 750 conditions and unfavorable weather, plan to burn natural gas at its next ma- railcars that carry coal from the Appa-
~
Electric Fuels beheves unregulated jor power plant. As a result. Electric lachian mines to Florida Power and oth-profits will improve in 1992. Fuels has developed a 'ong range strate ~
er customers.
gy to increase com sales to its other in-In 1991 the nation's coal market Company owned businesses oper-dustrial and electric utility customers.
suf fered one of its worst years in recent ate other facilities for repainng r ailcars, memory. in the next few years, the over- railcar parts, towboats, of f shore supply all coal market is expected to grow Acquiring new reserves to meet vesseis and tank barges. Most of the re-modestly at about two percent annual. future coal needs pair work at these facilities is with un-
. ly. But demand for low-sulfur coal - In January 1992, Electnc Fuels pur- affiliated customers, such as the central Anpalachian coal chased in excess of 50 million tons of Over the years, Electne Fuels has owned by Electnc Fuels-is estimated coal reserves in eastern Kentucky f rom made several strategic decisions to ex-to be higher, between three to five per- Inspiration Resources. The new acqui- pand into businesses that complement cent annually. Declining coal subsidies sition brings Electric Fuels' total proven its Tull-service ope rations. T hese acqui- ~
in Europe are expected to increase ex- reserves to more than 300 million tons sitions allow the company to maintain port demand for low-sulfur coal f rom the of clean, recoveraa - coal. Most of the control of the complete celivery proc-United States. In addition, U.S. electnc high quakty coalowned or controlled by ess, And the expansions contribute to utilities anticipate burning more low- Electric Fuels is located in castern Ken- higher sales and help strengthen the sulf ur coal to comply with tighter emis- tucky and southwestern Virginia. The company's earnings potential. Such an sion standards set by the Clean Air Act company looks to acquire coa l reserves integrated operation means coal deliv, of 1990. that have active mine operations and ex- eries can be handled more etficiently Each year, Electric Fuels delivers be, isting contracts with la ge industrial or and customers can enjoy the con-tween 5 to 6 milhon tons of low sulfur utihty customers. venience and cost savings of deahng coalto Florida Power. And since 1984, An integral part of Electnc Fuels' with one suppher.
Electric Fuels has reduced the cost of diversified operation is its transporta- Florida Progress believes the poten-dehvered coal to the utikty by 21 per- tion network. T he water u~id rail system tial for ea r nings growth at Electric Fuels cent. That has allowed Florida Power to includes terminal facihties, nver barges. is strong. The coal and transportation produce electricity at the lowest cost oceangoing vessels and railcars. Elec- company will continue to capitah/e on per kilowatt-hour for coal fired plants inc Fuels owns coal transloadingterme its existing operations and expand into among the state's investor-owned nats in Ohio, Kentucky and West Virginia areas in which it has expenence and utilities. from which it serves its customers. expertise.
D
-~
_T
. E EE ~
l e
l g And because of this strategy, the com. ,. ._ : .y' .- 'j .
pany is able to keep its assets in safe, high-quality securities. More than 95
~
O percent of its financial portfolio is in
[4* ,
8
. investment-grade securities. , . .
l l ., Founded in 1909, Mid Continent is ~ -% .
~ ~
'~
~
t hea dquartered in Oklahoma City and is ? '
l L" now licensed in 37 states. Its 6,000 in- i. >i L i .
d dependent agents have underwntten /- ' ' 'l ' 'l .-
X
! more than $10 billion worth of hfe insur- I -
O.,
. ~ ' 4[, J ' ".J.
- ; ance protection. In the last five years, .
y
/ ~ ' '
<: the company's total insurance under- L c.- E M Ca_dfM A foreign ship is repaired at an Dectric written for pohcyholders has increased During 1991, Advanced Separation Fueis dry dock and repair faelitty near an average of 19 percent annuaiiy - recaaas+> ** *~a wa separardoa l New orleans. OsEP) rnachines, includmg th!s installation I which is well above the industry average- at creat takes sugar near Toledo. ohio.
For 13 consecutive years, the com.
( Mid ContinentLifeinsurance Company nwam @
l Florida Progress also is pursuing a ingof A+ (Superior)from A.M.BestCo., three machines have been sold since growth strategy for its life insurance a national rating agency. Fewer than Advanced Separation developed the company. Since being acquired by eight percent of the nation's 2,300 life unique system six years ago.
Florida Progress in 1986. Mid-Continent insurance companies have achieved Future strategies for Advanced Life lnsurance Company has increased Sc,Jaration will be directed et becom.
this distinction. Mid-Continent's current profits every year and continues to pr ~ statutory ratio of capitaland surplus to ing a dominant supplier to chemical and l
i vide excellent returns. assets is 26 percent - almost five times food processing companies. The ISEP in 1991, Mid Continent produced better than the industry average. machine se parates chemicals in a con-higher earnings than the year before The f uture diversification strategy of tinuous process rather than conduct-l and showed steady growth in its opera' Florida Progress includes positioning ing the separation in batches. The ;
tions. Earnings have increased an aver- Mid. Continent f or conservative, stea dy machine, which i . ';pically about 20 '
ageof 24 percentannuallysince1986. feet tall and has a diameter of 15 feet, Browth.
i The company achieves success by us- alsocanbe used to removemanytypes ,
ing a consistent approach to underwrit- Advanced Separation Technologies of dissolved impunties.
- ing and maintaining a conservative Florida Progress' research and develop-investment portfolio. ment subsidiary continues to increase Other Diversified Operations Mid-Continent operates profitably at sales of its patented adsorption system. Florida Progress during 1991 com-a time when other life insurance com- In 1991. Advanced Separation Technol, pleted an evaluation of the long term panies are struggling. About 10 years ogies locorporated sold seven of its lon growth potential ot its other diversified ago, the company decided to concen- Separation (ISEP) machines. Recent operations. As a result, several strate-trate on selling a death benefit policy orders have been sold to commercial gic moves were made that will reshape l that does not include a significant sav- and laboratory facilities located outside the future of the company's diversified ings feature. The " extra hfe" pokcy is the United States, including facilities operations.
popular because it provides the maxi- owned by such major companies as in 1991 Florida Progress sold three mum amount of protection for the least Archer Daniels Midland, Du Pont and of its five building products operatioris amount of premium. Pfizer. ISEP machines have been sold and completed the divestiture of the last Manylifeinsurancecompanieswere to companiesin Canada. South Ameri- two operations in January 1992. The l forced to invest in riskier securities to ca, Japan, Korea, France, Ita y, Holland original after-tax loss provision was '
provide higher returns on policies with and Belgium. Negotiations are contin- increased $2.4 million to cover the to-targesavingsfeatures Mid Continent's uing for orders in Germany, Norway and tal losses from the sale of these ;
- policies primarily of fer a death benefit. two more in South America. Twenty- operations D
__ - _2____-
. . ;c.=:# C=grJg u q 7.:
The company will not make new in- In September. Florida Progress an-
' i q' ' ' ' '
vestments in real estate and intends to nounced it would be gin an orderly with-sellits existing holdings when market drawal from this business. Although 7.i ~
b
~~
conditionsarefavo able.Thecompany's Progress Credit has been profitable, its -
- j L.
' '"{.f[r . q investments in its real estate portfolio. growth would require too much of a cap- '
including sts exposure through partner- ital commitment at a time when new .- @
ship liabilities and debt guarantees, to- . . g [ ? ^C.c ,j . ., .
capital is needed to support Flonda :
tal approximately $300 million. The Power's futt.re construction program. w. .
.. w%
majority of this capitalis invested in Bar. E4 . ' W,J i.* "-t ; [. N
- nett Tower, Florida Progress' headquar.
ters building. the Carillon of fice park and Florida Progress to sell assets of #
. . . N .;
) g partnerships developing upscale apart' AF ida o ress subsidiary since O
AI, b hS' 1983, Progress Credit has been in- Y rnent complexes and lifecare facilities.
volved in levera ged leasing. cquipment k Diif [U U $h8 D
- K' Mkf[l While the opportunities to sell these financing, senior secured commercial NNnM' 4 projects are expected to improve as the lending and investing in high-quality reat estate market improves, the dives' secunties. Its fnancial portfolio -
titure of a substantial portion of this which totaled $658 million at the end craft leases for equipment operated portfolio is expected to take about five of 1991 - primarily contains commer. primanly by stronger airlines such as years. cial aircraft loans and leases and first Delta and American.
Florida Progress also reassessed mortgage reat estate loans. About one- Since the end of 1990. Progress the f uture role of its lending and leasing half of the financial portfolio consists Credit's finance receivables have been operation,ProgressCreditCor oration. of leveraged leases. These include air. affected by weak market conditions in
the airline and real estate industries.
T his has resulted in some delinquencies in lease und loan payments as well as loan principal maturities. Florida Progress has been working to negoti-ate and restructure these transactions and will, if necessary. exercise legal remedies. tion in the airline and real estate indus. ,
es, s resem 's i spected to be Plans are under way to sell most of adequatu to implement the liquidation the assets of Progress Credit as mar-strategy.
ket conditions improve. In 1991, Progress Credit sold $137 million of Florida Progress believes recent marketable secunties and highly lever, changes in its diversified operations will Dged trarisaction loans for a gain of improve the performance of its diversi-fied operations and strengthen the
$14.5 million.
3 companys financial position. lhese Progress Credit increased its loss re-changes are intended to help the com-serve by $16 million during 1991. The pany achieve higher long-term earnings reserve batance atthe end of 1991 was gr wth and increase returns for its
$20 million, after recognizing a shareholders.
$6-million loss on one of its aircraft leases. Assuming no furtt.cr deteriora- E E E j I
llTNvYS$ hod'EfW$5NIhEkI,WeY Insurance Corripeny malothins its C
_; headquarters in Okkneme Citil@h '"A we. - , l:,;f,el-f0 #1 N AR$
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l l
1 l MANAGEMENT'S DISCUSSION AND A N A LYSIS l n- . a; e .. y <~~.v OPERATING RESUL1S l . %;M,N.
?.
i[ ; .. e 3 v cf... ..
imhtNtth%4th51kANQtAtcanctivts, i((' ~
Ji'" % . J' ' ; " ' . .
- l. .
- ;;i; g ' 4
- Florida Progress Corporation's con-sobdated earnings per share for 1991 l
l :. W Wri! Wese:4pte spareylaer r'et/ftntitat h rompetitwe with ott er i hagt$pesiiifelecteac titolity c were $3.20, compared with $3.21 in i i ' ; tomnahies ' -- ,
.8" 1990 and $3.67 in 1989 In 1990.the
( company reduced not income for aloss 7 A.Develoc.tHe cm,nyw s te new.es in a dennei that ma,stMts tinmeEial strengpr . . ' _
l k
- 3 esamte aIompe.in+ demwd powin raic tiirgMverdiccation *O on disposal of its budding products
..W >
g - ;; y K. i-
- '" N , operationsby $14.2 milhon.or $ 28per
. m, l
, . , -1 y . 3 . .-
.- g- .- .
share. In 1991. an additional loss of 1..
$2.4 mdhon. or $.04 per share. was I -- .e, v.' . -. ' '
ON&NCIAL 90Adik utsuTy ' '. 1991 REsults. ' recognized to complete the dives-
. 'W% mitts.n a Doutwe 4 on.t Au ega[tmon - ~. titure';.
. ' A4 999 & pneim. ;~
. ,.Amteng
. 343 f.hroh investors semce. tnc - .- Stock ddution accounted for a large 1
- AdV 5.gepoyAte,westors servict partof thedechneinearn ngspershare.
jO - standarti & Pty s -
Flonda Progress issued new shares of
. W r anuireaudnor> r,itv ot <etur n nm om*"" . . . ., common stock through a May 1991
- f . oopett
, '" ' , , p .Q . ' 7 , 7. , " ' public stock of fering and through the to 136 wittun tre anomatoe rangy W. >
iv. n . . .
. K-
.s.'
company's dividend r einvestment and i
, .. cc . 3 .. . .,
! ' E %qt qhtenb ripuremew. mt.nout n. . - L:,.- -
L' stock purchase p'an.
l ; . cocheria ap.hmsvat%tpyti e%e.en . f; ' 7 .
pitivv di quam pmgwues m tne em fnn - t .
.,,./ 5t Ut W e . . . . , - . ww -
, ,a utgip in@stry ,7 .
. ,, . . - .. . ,.e o : ,
"):.J. ~ . 3 f- In 1991. Flonda Power Corporation
_. a wmea.n ontennageeip ie...a q twes
. p,
.. t..'
c . l. '~ .i,.;.g ,
eamed $164.1 mdnon, or $3.05 per
.; . '* . . share compared with $165.5 rndhon.
', [
4
. 5 poerrev generote at ica,r 9 uu on or $3.22 per share. in 1990. Higher 7 . . ... ..i n
.:mp, s.. . . Lg . S.
.struction apendaumg . - .
. .
- y , .. .. . depre<.,iation rates ordered by the Flon.
JEMyntain capet ytiuctu e 9 n mm . ' o .
- , . m; q.;, . ,Ja Public Service Cormssion (FPSC) !
Tats bent w tm enan .m . e s -
mts oewt on . . . l
. t.
.conimon enu4 m. geentc,*a. v.f. -
"Ups epps . . $m .ll and the continuing impact of inflation 3
. . -
- strefoubo wn+p.-, n mi. . . .- on other operating and maintenance pretened swa n, icio truse n.,
L1 expenses lowered Florida Power's ,
- c. c v ,
i.!, , . .
.u
/ 2-l ' ,.g ' . ,. .ql . ' ..
y .'L earnings. l
. l; i.N. Flonda Power's customer growth 19h1REsuQs _ 7.h ,'. . , , . and higher energy usage by commer-NANCIAL GOAL - 68WYRSWtED D#EftM10NS 1
.3 hougn Woaress tapiteWoldinh o.a,e . ' ' ~ - . Q woo, s nyestom semce cial customers partially off set the im-V ~tainasms)c Arating w nwqium acennup . .)- ,stannaio s he s -
pact of higher expenses during the t-'. year. Retad knowatt hour sales in-i .
. g; . . l 6 '.- g
~
,e f
s x . . ~. creased 3.1 % in 1991 due to residen-
, ( ,' ( a ,, . il
',J '
- ' . p' e ;! tial and commercial customer growth.
EAnnthos PER SHARE .
. . . . , .; ..- ., Operating revenues for Florida 199r y 8990 .
1989 f ' Power were shghtly higherin 1991 due Oorkra /nwer_cuporation " $ 3 05 . . D$p . 5.ya ' n to retad sales growth of f set by reduced
~
taectne Neis cdpresion , 15 N .. 1e recoverable fuel revenues. In 1990, a
. ahd-Continentiite insurente.corhmm>
14 , 8q2 . -* - no
.. Progiens credit corporateori . 13f .
retail customer bdhng credit reduced to . . g 13 g Talouen corporation P t 12) - n' - l040 -
1 05) ~ operating revenues by $12.5 mdhon
' Corporate & Otner and utihty ea rnings by $ 7.8 milhon T he
.[ - ( .14) b . . @. .,,,_o1: .
i
[
owers## sed - .
ist - g_Ja * ; 37 3- FPSC voted to discontinue the cus.
I des'
. Cor$rmma openstigts 53.24 - , 53 go, . . - tomer bilhng credit at the end of 1990.
i
.l. ' Discontmuod Operstmns
- q. 3 04) . j 2h ' 02. * ~ " In December 1991. the FPSC ruled 3 '[
- ,contehented f 13;al I .,; in f avor of Florida Power by refusing to
' . 3v. .-y. ' $3 21. . .y l 53g e , ., .
disallow $40 mdhon in inc.emental
'n. . . i V .
. o -l .
t .J ; t ., f.1 . . . , ' " :. . replacement fuel costs incurred dunng 5
.u
.: .._..m s . .
..<. .1 p . .
~ .
Aeerage Annual Customer Growth tin tmem 6
and higher oil prices of fset by increased remote that these actions will have a nuclear generation.Since Florida Power material adverse effect on its future
- 4. , 1 recovers substantially all fuel costs financialposition (SeeNote 100npage
+""'
4 -~ ,%4 q, . . . f . through a f uel adjustment clause, and 4 4.)
'V '
defers any adjustments to the fo% wing
- A ' period, these fluctuations have littie im- Diversified Operations p ct on net income. Du... / 1991 Florida Progress con-2 Other utility operation expenses rose tinued a strategic evaluation of its diver-by $24.6 million in 1991 mainly due to sified operations. As a result, the increased costs associated with recov- company beganimplementingchanges that will redirect its diversification
.g ; erable energy conservation programs 0 and higher assessment fees levied in- program.
dustrywide by the tJ.S. Nuclear Regula- The company has sold all five of its 2 Rsca Power . E hest *0wneHlearr,thM.es tory Commission, building products businesses and plans in December 1990, the FPSC or- to withdraw from real estate develop- -
outages at the Crystal River Nuclear dered Florida Power to increase its ment as market conditions allow. (See Plant. The decision concluded a lengthy annual depreciation expenses, includ- pages 19 and 20.)
investigation initiated by the Office of ing a provision for fossil plant disman- Florida Progress also has reassessen Public Counsel, which requested the tiement costs, without a corresponding the future role of its lending and leas-FPSC to disallow incremental replace- increase in base rates. During 1991, ing business, Progress Credit Corpora-ment fuel costs for outages during higher depreciation rates lowered tion. (See pages 20 and 21.)
1988 and 1989. Florida Power's net income by $23.2 mil- The sale of the real estate portfolio in June 1991, the FPSC ordered a lion and reduced the utility's earnings and Progress Credit's holdings are ex-separate review of two other outages per snare by $.43 compared to the pri- pected to result in lower revenues and that occurred in late 1989 and 1990. or year. Florida Power expects that ad- lower interest expense for the company.
The incremental cost of replacement ditional depreciation expense for fossil The impact on net incomi. will depend f uel for these outages is a pproximately plant dismantlement costs will be or- on the timing of sales and the relation- ,
$17 million. Florida Power has filed dered by the FPSC in connection with ship between the returns on the assets testimony with the FPSC supporting the the January 1992 rate filing. (See Note sold, carrying costs incurred a ld the in-utility's position A decision is expect- 1 to the Consolidated Financial State- terest rates on the associated debt ea in 1992. Management believes that ments on page 36.) repaid.
any amount of replacement fuel that in January 1992 Florida Power filed While Flonda Progress restructures g may be disallowed would not- be a petition with the FPSC requesting a its diversified operations, the company retailrateincreaseof $145.9 millionin plans to concentrate on expanding its material, In January 1990, the FPSC dis- annual revenues. The petition also re- coal and transportation business, Elec-allowed recovery of certain affiliated ouested interim relief of $31.6 million tric Fuels Corporation.The company be-coal costs, which reduced 1990 tesults tuased nn the 12 month period ending lieves this energy-related business is an by $.05 per share. This fuling, which November 30,1991.(See page 13 and excellent strategic fit with its utility resulted from adopting a market based Note 9 on page 42.) company, pricing methodology for recoverable Florida Power has been notified by Florida Progress will continue its es-f uel costs for purchac0s trom an affiliat- the 1).S. Environmental Protection Agen- tablished growth strategy for its life in-ed coal supplier,is not expected to have cy that it is a potentially responsible surance business. Mid-Continent Life a significant effect on future operating party in the cleanup costs of several Insurance Company has remained pro-results. waste disposal sites undar the Com- fitable, posting steady annual earnings Fuel and purchased power costs prehensive Environmental Response growth, since its acquisition in 1986.
decreased by $60 million in 1991 pri- Compensation and Liability Act and the Florida Progress believes these marily due to lower fossil f uel costs and Supertund Amendment and Reauthori- strategies will allow its diversified ope r-increased generation f rom the nuclear zation Act. The utility believes, based on ations to achieve higher long-term eam-plant. These costs increased in 1990 the status of these matters and the large ings growth and better total returns.
compared with 1989 due to recovery number of potentially responsible par- In 1991, earnings from contint hg of previously deferred fuel expenses ties involved. that the possibility is diversified operations were $10.4 mil-B
Retum on Equity ow am 70 lion, or $.19 per share, compared with cipal reason for the dif ference between
$14.3 milhon, or $ 28 per share,in 1990. 1991 and 1990 results. %,
D Earnings for Electric Fuels were $.15 In March 1990, Talquin entered into 7 per share in 1991, compared with $.19 an installment sale of its citrus groves in 1990 and $ 18 in 1989. Earnings from for an after tax gain of 57.7 million. The g*
unaffiliated coal sales were lower due gain recorded at closing in 1990 was to weak market conditions that reduced $4.6 milhon, or $.09 per snare. The bal-margins throughout the year. Earnmgs ance of $3.1 milhon, or $.06 per share, 5 ..
were also adverseiy affected in 1991, was recognized in 1991. In addition, and willlikely be in f uture years, because Talquin realized approximately $2.2 mil- __
i Electric Fuels renegotiated a coal con- hon, or $.04 per share, in earnings f rom o tract with an affiliated coal supplier to the citrus crop in 1990. N 1933 % W M91 conform to the market-based pricing The recession in the national econ. u Unrs Opens If Corm,ng DwersAed methodology adopted by the FPSC. omy and Florida's reat estate market has 4" "
(See Note 9 on page 43.) hurt the results at the company's diver-Mid-Continent Life's carnings for sified operations for the past three 1991 increased to $.14 per share from yeam At the end of 1990, Florida other previously owned operations. In
$.12 in 1990 and $.10 in 1989. The Progress beheved it was prudent to 1991, the corporato and other opera-continuing expansion and uevelopment increase its reserves for real estate tinns resulted in a loss per share of $_14, of the regional office network and grow- proj ects a nd lending an d le asing a ctivi- compared with $.12 in 1990 and $.01 ing market share are the principal ties in light of the weak economy. The of net earnings in 1989. In 1989, earn-reasons for the rise in earnings. Since a..ar tax effect of these reserves ings were increased $.11 per share due 1986, the insurance company's earn- reduced 1990 earnings by $ 5.6 milhon, to the gain on the sale and operations ingshaveincreasedanaverageof 24% or $.11 per share. of Better Business Forms, Inc.
annually. Since Talquin's real estate properties in 1991, diversified revenues, cost of in October 1990. Florida Progress are located in growth areas, manage- sales and other expenses increased announced plans to sell its five build- ment believes the market for its projects significantly compared with 1990.
ing products operations. Anticipating should begin to recover a s the economy T hese increases resulted f rom new coal 2 losses from the sale of these opera- improves. The weak rea! estate market operations at Elect 7c Fuels and volume tions. the company reduced netincome will require Talquin to hold. and absorb growth at Progress Credit and Mid-by $14.2 million in 1990 by establish- ca rrying costs on, th ese properties un- Continent Life and increaseri 'oan and ing a reserve for the disposition costs til economic conditions improve. lease loss provisions at Prc gre 'redit.
and potential losses. Earnings for Progress Creditin 1991 Thereturnonequitycharth J ,thts Flonda Progress hasnow soldallfive were $.16 per share. compared with the relationship between utility and of the building products operations. Net $.13 in both 1990 and 1989. Since an- continuing diversified operations. The income was reduced by $2.4 million in nouncing its decision to implement an returns on the utihty's common er;uity 1991 to provide for the total losses in- orderly hauidation of the commerci2il were 12.9% in 1991,14.2% in 1990 and curred from these divestitures. The lending and leasing businesses in Sep- 15.1% in 1989. The lower returnin 1991 company has reported the net assets tember 1991, Floriua Progress has is primarily due to higher depreciation and operating results of the building reduced Progress Credit's financial as- expenses, including fossil plant dis-products operations as " discontinued sets by nearly 25%, or approximately mantlement costs, and the increased operations" for all years presented. (See $ 200 million. Progress Credit also real- equity base resulting from a $100 Note 11 on page 44.) ized gains of $14.5 milhon on the sale milhon equity infusion during the year, in 1991, Talquin Corporation, Florida of certain assets and provided $16.4 mil- The 1990 return was reduced due to a Progress' aevelopment subsidiary, real- hon for possible loan and lease losses customer credit that lowered revenues.
ized losses from continuing operations (See Note 5 on page 40.) The returns on equity for continuing of $.12 per share. in 1990 and 1989, the Corporate and other operations in- diversified operations were 4.8% in losses per share were 5.04 and $05, cludestheuna!!ocatedexpensesof the 1991,7.6% in 1990 and 9.8% in 1989.
respectively. holdingcompany, AdvancedSeparation In both 1991 and 1990, divc.sified Thetimingof thecarningsonthesale Technologies incorporated. Progress retums were depressed mainly due to I of Talquin's citrus operations is the porr Energy Corporation and the results of holding real estate properties without
! B l
Capital fiequirements onmahansaf donare 900 significant sales activity. The 1991 re- tainsectionsof thestandard.Basedon g turn was also affected by the lower theprovisionsof theexposuredraft,the results at Electric Fuels, which were company has preliminarily determined M' p{} g}N
~
mainly attributed to the depressed eco- that the adoption of the standard will 600 pp4 nomic climate during the year. The per- have an insignificant impact on earn- 500 centage of equity invested in diversified ings in the year of adoption. (See Note a wm -
operations is 18% at the end of 1991 1 on page 36.)
and is likely to remain at 20% or less. * -
Other 200 Interest Expense and Inflation Florida Progress is also required to 100 Interest expense increased in 1991 due adopt Financial Accounting Standard a
to hlgher debt levels during the first five No.106, " Employers' Accounting for 39g7 393g ggg gggg 3gg3 months of the year. These additional Postretirement Benefits Other Than $435.s $5 m srat $821.2 $8711 borrowings, funded dunng the fourth Pensions 7 starting in 1993. Tnis stan. m utmty nxem u D+eends quarter of 1990, were primarily for dard mandates that an employer's u nnanaanovestments D Dws6ee ncpem -
= h" investments in leases and loans at Progress Credit. Most of the proceeds obligation for postretirement benefits be fully accrued by the date employees
%$C75 from thecommonstockofferingin May attain full eligibility to receive these Another Financial Accounting Stan-1991 were initially used to retire short- benefits. Florida Progress' policy has dard will impact the company's dis-term debt at Florida Power- been to accrue benefits currently pay- closure for financial instruments in Allowance for funds used during cor- able along with amortization of past 1992. (See Note 1 on page 37.)
struction increased $5.2 million in service costs for current retirees. The 1991, compared with 1990, due to the company estimates it will accrue LIQUIDITY AND CAPITAL RESOURCES higher level of construction work in pro- approximately $15 million to $20 mil- Financing for utility and diversified oper-gress at Florida Power during the year. lion in additional a nnual costs under the ations is coordinated and managed at g Even though the inflation rate has new standard, but expects a substan- the holding company.
been relatively low in recent years, tial portion to be recoverable through Cash from operations has been the inflation continues to affect Flonda base rates. Florida Power has included pnmary source of capital for Florida Progress by reducing the purchasing these costs in its retail rate increase pe- Progress over the last five years.
power of the dollar and increasing the tition Tiled in January 1992. (See Note in May 1991,thecompanysold more cost of replacing assets used in the busi- 7 on page 41.) than 2.9 million common shares ness. This has a negative ef feet on tne through its first underwritten public company since regulators do not gener- stock offering since 1983. The net ally consiocr this economic loss when proceeds totaled $113.2 million. The -
utility rates are set. However such loss. Sources of Capital un nwm ef ounard company also raised equity capital es are partly offset by the economic
- through its dividend reinvestment and gains that result from the repayment of 800 F"i hwd stock purchase planin 1991 and 1990, long term debt with inflated dollars. g #b in 1991, approximately 680,000 shares
[M of Common stock wereissued through income Taxes ,
the plan yielding proceeds of $27.9 The effective income tax rate for 1989 500 million.
was lower than normal due to a regula- 400 Other sources of capital have in-tory ruling that resulted in a one year 300 cluded proceeds from the sale of the pass through of deferred income tax building products operations and real savings to utility customers. # estate caveiopment properties. In 1991, Florida Progress expects to adopt 100 $127.9 million was received f rom the net Financial Accounting Standard No. 96, o reduction of Progress Credit's financial l
' Accounting for income Taxes:in 1993. gy, g3y1 $N1 N2 - ssI1!1 ssets.
The deadline for implementation has 5 0peranons E Debt we Florida Progress' common equity.as recently been extended and a new ex- E Common Stoo s1 Rnanciannvestments a percent of total capital, increased to posure draft clanfies and amends cer- C Otter 44.8% in 1991, compared with 38.8%
B
Capital Structure mmeo 100 mgmynw wo -+
- l tures wdl be financed with interna'ly the pubhc stock offenng to further g generated funds. strengthen the "hty's financia! posi- l In August 1991, the utihty filed a need tion. The utsht) ually used these funds l Certification pe!!! ion with the FPSC for to reduce sb derm debt.
60 approval to construct gas-fired. Florida Power's short term financing combined-cycle generating units in Polk needs are funded primanly th.augh its j e County Construction expenditures of commercial paper program.
$81 million are planned for th:s new in November 1991, Flonda Power energy complex in the 19921996 for+ estabhshed a 364-day and a five year D cast with the bulk of the expenditures revolving bank credit facihty, both for in the later years $200 milhon of which $300 milhon wdi c As of year-end, the utility has several bc used to backup commercial paper. i e 1%8 G89 m e long term purchase power commit- l B Cmun Sm E PW 4 Si ments as part of its plan to meet f uture Diversified Operations a to Tem Dm u % Tem c e s energy demand growth. (See page 11 PCH was formedin 1988 to consohdate i I
and Note 10 on page 43 with respect the financial strength of the diversified to the present and possible future im- operations This downstream holding in 1990 in addition, short term capital pact of these commitments.) company, having the benefit of a sup-was 4.1% of total capital at year end The Clean Air Act of 1990 requires port agreement with Florida Progress, 1991,down from 18.6% a yearago The electric utihty companies to reduce sul- helps to lower the cost of capital to those improvement in the company's capital fur dioxide emissions in two phases. Indwidual businesses.
sti ucture resu!ts primanly f rom selbng Florida Power will not be af fected by PCH funds diversifien operations
! Flonda Progress common stock, Florida Phase i and can meet Phase ll!equire- pnmanly through theissuance of com-Power first mortgage bonds and a part ments with minimal capita! mod'fic+ mercial paper and medium term notes.
of Progress Credit's financial assets. tions. (See page 12.) PCH's commercial paper program is Debt restructuring at Progress Capital in add'tton to f unding its construc- rated A-1 by Standard and Poor's and P-1 Holdings. Inc. (PCH) also cor.tnbuted to tion commitments with cash from by Moody's and its medium term note the improvement, operations, Flonda Power accesses the program is rated A and A2, respectively.
Florida Progress' primary short and capital markets through the issuance During 1991 PCH issued $1/4 mil.
long-term capital requirements result of medium-term notes, first mortgage hon in medium-term notes from its from utihty construction and property Donds ano equity from Flonda Progress' $400 mdhon medium term note pro-additions, dividend payments to com- common stock sales Flonda Power's gram, leaving $ 226 milhon avadable for i mon shareholders, debt repayments goal is to maintain a capital structure future issuance. These notes were i and diversified property additions that willretain its double A minus credit issued to better match the expected !
Otner capital requirements include rating. holding penod of assets of diversified business acquisitions and joint venture During 1991. Flonda Power repaid subsidianes includmg restructured l investments. $140 milhonoflong-term debtof which loansatProgressCredit (SeeNote 5on
$125 milhon were bank borrowings and page 40.) ,
Utility $15 milhon were matunng medium- As a result of the issuance of )
Florida Power's construction expendi- term notes. These repayments were medium term notes and the sale of a tures for 1991 totaled $345.9 mdlion, funded in part through the issuance of portion of Progress Credit assets, PCH )
consisting primarily of distribution and $150 milhon in first mortgage bonds reduced its commercial paper backup production expenditures. These expen- and $29.5 mdhon of medium-term knes of credit by $100 milhon to $400 ditures were financed primanly with notes Redemptions of high-cost debt milhon and terminated a $150 milhon cash from operations. The five year con- and favorable market cond:tions have facihty during 1991. The $400 milhon struction program includes planned helped lower Flonda Power's embedded commercial paper backup is composed expendtturas of $483 mdhon.$4 47 mil- cost of long-term debt to 78% at De. of a 364 day, $100-milhon facihty and '
i l hon, $375 million, $438 milhon and cember 31,1991. a five year, $300-milhon facihty Ry
$434 milhon for 1992 through 1996. In May 1991. Flonda Progress con- changing the term of the commercial Flonda Power forecasts that an average tributed $100 milhon in equity capital paper backup facihty to be pnmarily of 63% of theseconstruction expendi- to Florida Power from the proceeds of long term and reducing the amount of i
El mi; J .
.: L: :Y+Jr - : > ^
. ~ ':
i 4
short term debt. PCH has strengthened with most of these planned expend- remedial actions, where appropnate.
Its wort term liquidity. PCH's short term itures designated for the non regulated (See Note o on page 39.)
debt as a component of total capital coaloperationsof Electric Fuels.These Florida Progress has off-balance decreased to 3.7% at December 31. expenditures are to be financed through sheet risk related to debt of unconsoli-1991 from 46% at year end 1990. medium-term notes and internal cash dated partnerships. (See Note 10 on generation. page 43.) Should a partner in any part-in 1991, total diversified capital ex-Progress Credit's portfolio includes nership become unable 1o meet its penditures were $37.9 million, primanly more than $600 million of investments share of the partnerships obligations, for facekty construction and equipment related to the airline and commercial the remaining partners would be liable replacements at Electric Fuels. In 1991' real estate industries. Progress Credit's for all the debts of the partnership.
investments in leases, loans and secu-I "
rities generated net proceeds of $127.9 Foradiscussionof thechallenges fac-e by co t ns in the a ne nd ty million, compared with a net use of ing Flonda Progress andits subsidianes, and a weak real estate market As a re.
funds of $229.2 million in 1990 and sult, Progress Credit has experienced refer to the interview with Executives on
$154.1 million in 1989,largely because pages 6 and 7. Company executives out-dehnquencies in ongoing lease and loan of beginning the sale of Progress Credit line key strategies for Florida Progress ayments as well as loan principal matu-assets in late 1991. and discuss expectations for the future.
rities. Progress Credit has negotiated In 1992, diversified capital expend- the restructunng of certain transactions itures are forecasted to be $13 million, and instituted legal remedies and other N N E l
M A N A G E M E N T '
S R E P O R T To Our Shareholde. :
Management is responsible for the integrity and objec- ment's judgment with respect to the relative cost and tivityof thefinancialandoperatingintormationcontained expected benefits of specific control measures. The com-inthis 1991 AnnualReporttoShareholders,includingthe pany also maintains an internal auditing function that l consohdated financial statements covered by the Reports evalua i and formally reports on the adequacy and ef-I of the independent Certified Public Accountants. These fectiver. ess of internal controls, policies a nd procedures.
statements were prepared in accordance with generally in addition, the audit committee of the board of accepted accounting pnntiples and necessarily include directors, consisting solely of outside directors, meets peri-amounts that are based on judgments and estimates by odically with management, the internal auditors and the management- independent a uditors to review matters reiated to internal Florida Progress Corporation maintains internal con- controls, audit results, financial statements and financial
( trol systems and related policies and procedures designed reporting. Annually, the audit committee recommends to provide reasonable assurance that assets are to the board of directors the selection of independent safeguarded, that transactions are executed as author- auditors. Both the independent auditors and the intemal ized and are properly recorded and that accounting auditors periodically meet alone with the audit commit-records may be relied upon for the preparation of con- tee and have free access to the committee at any time.
l solidated financ:al statements and other financial infor-
. mation. These poiicies and procedures include a Code For Management, i e Conduct program intended to ensure employees ad-here to the highest standards of personal and professional integrity. The design, monitoring and revision of internal ,
control systems invohfe, among other things, manage- p ,
David R. Kuzma Senior Vice President and Chief Financial Officer E
j R E P O R T S F R O M A U D I T O R S l Repods of the lndependent Certified Public Accountants To the Shareholders of Florida Progress Corporation: To the Shareholders of Flonda Progress Corporation:
We have audited the accompanying consolidated balance We have audited the accompanying consolidated state-sheets of Flor!da Progress Corporation (a Florida corpo- ments of income, G.;h flows, and shareholders' equity ration) and subsidiaries as of December 31,1991 and of Florice Progress Corporation (a Florida corporation) 1990, and the related consolidated statements of income, and subsidiaries for the year ended December 31,1989.
cash flows, and shareholders' equity for each of the years These financial statements are the responsibility of Florida in the two-year period ended December 31,1991. These Progress Corporation's management. Our responsibility financial statements are the responsibility of Florida is to express an opinion on these financial statements Progress Corporation's management. Our responsibility based on our audit.
is to express an opinion on these financial statements We conducted our audit in accordance with generally based on our audits- accepted auditing standards. T hose standards require that -
We conducted our audits in accordance with general- we plan and perform the audit to obtain reasonable as-ly accepted auditing standards. Those standards require sura nce about w heth er the fina ncial stateme nts referred that we plan and perform the audit to obtain reasonable to above are free of material misstatement. An audit in-assurance about whether the financial statements are cludes examining, on a test basis, evidence supporting free of material misstatement. An auditincludes examin- the amounts a nd disclosur es in t he financial statements.
Ing, on a test basis, evidence supporting the amounts An audit also includes assessing the accounting princi-and disclosures in the financial statements. An audit also pies used and significant estirnates made by management, includes assessing the accounting principles used and as well as evaluating the overall financial statement presen significant estimates made by management, .s well as tation. We believe that our audit provides a reasonable evaluating the overall financial statement presentation. basis for our opinion.
We believe that our audits provide a reasonable basis for in our opinion, the financial statements referred to our opinion. above present fairly, in all material respects, the results in our opinion, the financial statements referred to of Florida Progress Corporation and subsidiaries' opera.
above present fairly,in all material respects, the financial tions and their cash flows for the year ended December position of Florida Progress Corporation and subsidiaries 31,1989, in conformity with generally accepted account-as of December 31,1991 and 1990, and the results of ing principles.
their operations and their cash flows f or each of the yea rs in the two-year period ended December 31,1991, in con- -
formity with generally accepted accounting principles.
4 ' 4t' & * ,
St. Petersburg, Florida Tampa, Florida January 27,1992 January 29,1990 0
CONSOLIDATED FINANCIAL STATEMENTS CONSOLIDATED STATEMENTS OF INCOME N FLORIDA PROGRESS CORPORATION i foR THE YEARS I NDED DECEMBER 31,1991,1990 and 1989 (In moons, orcept per share amounts) 1991 1990 1989
- REN ENUES:
Electrc utility $ 1,718.8 $ 1,709.1 $ 1,627.0 Diversi fied 355.9 301.7 274.3 2,074.7 2,010.8 1,901.3 EXPENSES:
Electric utility:
Fuel and purchased power 606.6 666.6 621.4 Other 282.0 257.4 248.4 Oper6tions 888.6 924.0 869.8 Maintenance 134.8 126.2 131.4 Depreciation 206.3 161.1 155.3 Taxes other than income taxes 129.3 119.9 107.3 1,359.0 1,331.2 1,263.8 Diversified.
Cost of sales 238.4 205.8 187.3 Other _
61.9 39.7 42.0 30 1 245.5 229.3 INCOME FROM OPERATIONS _
415.4 434.1 408.2 INTEREST EXPENSE ANO OTHER:
Interest expense 146.1 144.4 125.7 Allowance for funds used dunng construction (9.4) (4.2) (5.2)
Preferred dividend requirements of Florida Power 16.8 16.8 16.8 Other income, net (4.5) (5.1) (7.2) 149.0 151.9 130.1 INCOME FROM CONTINUING OPERATIONS BEFORE INCOME l AXES 266.4 282.2 278.1 Income taxes 91.9 102.4 92.0 INCOME FROM CONTINUING OPERATIONS 174.5 179.8 186.1 DISCONTINUED OPERATIONS. net of income taxes:
Income (loss)from operations -
(.8) 1.0 Provision for loss on disposal (2.4) (14.2) -
Income (loss) from discontinued operations (2.4) (15.0) 1.0 NET INCOME $ 172.1 $ 164.8 $ 1871 AVERAGE SHARES OF COMMON STOCK OUTSTANDING 53.9 51.3 51.1 EARNINGS PER AVERAGE COMMON SHARE:
Continuing operations $3.24 $ 3.50 $3.65 Discontinued operations (.04) (.29) .02
$3.20 $3.21 $ 3.67 The BCComiMnyst'g notes are Sn entegralpart Of these financial Stat 6fnents B
l
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C O N S'O L I D A T E D FIN A N CI A L STATEMENTS CONSOLIDATED BALANCE SHEETS E FLORIDA PROGRESS CORPORATION DECEMBER 31,1991 and 1990 pn melhons) 19 :. A 1990-ASSETS'
- PROPERTY, PLANT AND EQUIPMENT:
Electric utility plant in service and held for future use $4,544.5 $4,355.2 Less: Accumulated depreciation 1,657.7 1,503.9 2.886.8 2,851.3 Construction workin progress 241.5 141.2 Nuclear fuel, net of amortization of $247.2 in 1991 and $218.7 in 1990 65.0 84.2 Net electric utility plant 3,193.3 3,076.7 Other property, net of depreciation of $98.6 in 1991 and $80.1 in 1990 348.3 343.7 3,541.6 3,420.4 CURRENT ASSETS:
Cash and equivalents 23.2 13.2 Accounts receivable, net 578 4 183.6 Current portion of leases and loans receivable 62.1 175.3 Inventories, primarily at average cost:
Fuel 81.5 103.9 Utility materials and supplies 95.3 92.4 Diversified materials and products 8.6 9.9 Underrecovery of fuel cost - 7.0 Other 37.0 15.0 486.1 600.3 NET ASSETS OF DISCONTINUED OPERATIONS 44.1 73.8 OTHER ASSETS:
Investments:
Leases and loans receivable. net 560.6 516.9 Marketable securities 98.6 165.5 Joint ventures, partnerships : id u.iregistered stock 101.6 112.5 Nuclear plant decom 'ioning fund 69.9 55.2 Deferred insurance polic) v,uisition costs 55.7 45.6 Other _
66.7 55.7 953.1 951.4
$ 5,024.9 $5,04 5.9 The accomoanyrng notes are an nntegralpart of these financial staternents.
n
(In nnlhons) 1991 1990 CAPITAL AND LIABILITIES
= COMMON STOCK EQUITY; Common stock without par value,250.000,000 shares authorized, 55,288,612 shares outstanding in 1991 and 51,700,926 in 1990 $ 811.6 $ 670.5 Retained earnings 776.1 753.8 1,587.7 1,424.3 CUMULATIVE PREFERRED STOCK OF FLORIDA POWER:
Without sinking funds 133.5 133.5 With sinking funds 97.5 100.0 LONG TERM DEBT 1,581.1 1,326.2 TOTAL CAPITAL 3,399.8 2,984.0 CURRENT LIABILITIES:
Accounts payable . 93.9 75.4 Customers' deposits 66.8 64.9 Income taxes payable 25.2 12.2 Accrued interest 37.9 39.5 Overrecovery of fuel cost 39.4 -
Other ,
56.5 57.2 319.7 249.2 Notes payable 78.4 578.1 Current portion of long-term debt and preferred stock 67.8 102.9 465.9 930.2 DEFERRED CREDITS AND OTHER LIABILITIES:
Deferredincome taxes 829.5 822.6 Una. .artized investment tax credits 138.1 147,9 Insurance policy benefit reserves 115.9 98.8
. Nuclear refueling outage reserve 13.8 5.8 Other 61.9 56.6 1,159.2 1,131.7 COMMITMENTS AND CONTINGENCIES ; Note 10)
S5,024.9 $5,04 5.9 E
CONSOLIDATED FINANCIAL STATEMENTS CONSOLIDATED STATEMENTS OF CASH FLOWS E3 FLORIDA PROGRESS CORPORATION roR THE YEARS ENDED DECEMBER St. 1991,1990 and 1989 (in rndhons) 1991 1990 1989 OPEF.ATING ACTIVITIES:
income fro,n continuing operations $174.5 $179 8 $106.1 Adjustments for noncash items:
Depreciation and amortization 266.3 207.4 191.6 Deferred income taxes and investment tax credits. net (22.6) 5.2 41.6 Changes in working capital, net of of fects fr a acquisition or sale of businesses:
Accounts receivable (4.7) 11.6 (50.5)
Inventories 21.5 (29.4) (22,1)
Overrecovery(underrecovery)of fuelcost 46.4 14.4 (54.7)
Accounts payabW 17.8 (27.9) 31.5 Othe r 13.7 13.7 28.4 Other operating activities 15.6 (1.1) 19.5 Cash provided by continuing operations 528.5 373.7 371.4 Income (loss) from discontinued operations (2.4) (15.0) 1.0 Adjustments for noncash items, ptimarily loss provision in 1990 B.7 23.6 5.5 Cash provided by discontinued operations 6.3 8.6 6.5 534.8 382.3 377.9 INVESTING ACTIVITIES:
Property additions (including allowance for borrowed f unds used during construction) (397.6) (327.4) (318.3)
Proceeds from sale of properties 31.3 31.1 13.8 Purchase of leases, loans and securities (121.1) (364.2) (187.6)
Proceeds from sale or collection of leases, loans and securities 249.0 135.0 33.5 Acquisition o' businesses (5.7) (36.2) (8.4)
Proceeds from sale of businesses 21.0 .1 40.5 Investments in joint ventures, partnerships and unregistered stock (11.2) (78.9) (16.5)
Distributions from joint ventures and partnerships 15.0 2.5 29.4 Other investing activities (10.6) (12.8) (14.8)
(229.9) (650.8) (428.4)
FINANCING ACTIVITIES:
Issuance of long. term debt 704.1 306.5 284.3 Repayment oflong-term debt (489.1) (136.1) (303.6)
Sale of common stock. 141.1 23.9 -
C 'dends paid on common stor. , (149.8) (136.7) (131.7)
Increase (decrease)in short-term debt (500.1) 189.4 225.8 Other financing activities (1.1) 2.5 (5.2) 249.5 69.6 (294.9)
NET INCREASE (DECREASE)IN CASH AND EQUlVALENTS 10.0 (19.0) 19.1 Beginning cash and equivalents 13.2 32 2 13.1 ENDING CASH AND EQUlVALENTS $ 23.2 $ 13.2 5 32.2 SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest (net of amount capitalized) $ 147.5 $ 141,3 $1219 income taxes (net of refunds) $101.5 $ 84.1 $ 46.5 The accornoanying notes are an untegralpstt of these frnancial staternents.
B
~ ~
_ y --_ _ - , _ - . _,_ ~ _ _ . _ _ _ _ _ . _
1 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY E FLORIDA PROGRESS CORPORATION K j FOR THE YEARS ENDED DECEMBCd 31/1991. l990 and 1989 (in milhoot, except share amounts)
Cumutetwe Preferred Stock of Flonda Power. ,
Without With Common Retained $1nking Sinking Stock Eamings M ds Funds
- Balance, December 31,1988 '
$646.6 $670.3 $133.5 $100.0 .l 1 Netincome 187.1
-Cash dividends on common stock ($2.58 per share) (131.7)
Dalance, December 31,1939 646.8 725.7 133.5- 100.0 iNetincome . 164.8
. Common stock issued - 649.726 shares - 23.9 Cash dividends on common stock ($2.665 per share) (136.7) sBalance, December 31; 1990 67is 753.8 133.5- 100.0 Netincome 172.1
- Common stock issued - 3.587,686 sharts - 141.1 LCash dividends on common stock ($2.765 per share) (149.8j
- Reclassified to current - 25,000 shares (2,5) planee, December 31,1991 _
$811.6 ' $776.1 $133.5 $ 97.5
- Tbe accompanying notes are an intevalpart of these tunancet sta:ements.
' NOTE'S TO CONSOLID ATED FIN ANCI AL ST ATEMENTS
. (1)
SUMMARY
OF SIGNIFICANT Utility Plant - Utility plant is stated at The cumulative fuel cost ditfetence is ACCOUNTING POLICIES 1 the original cost of construction, which shown in the balance sheet as over-General- Florida Progress Corporation - includes payroll and related costs such recovery or underrecovery of f uel costs.
- as taxes, pensions and other fringe Any overrecovery or underrecovery of I tion(theas Company)is a registeredexempt from regula. . benefits, general and administrative holding company costs, plus an interest factor, is to be s under the Public Utility Holding Com. ' costs and an allowance for funds used refunded or billed to customers during pany Act of 1935 Its largest subsidiaryJ ' during construction. Substantially all of the subsequent six-month period.
representing;73% of total assetsiis the utility plant is pledged as collateral - The cost of fossil fuel for electric x Florida PowerL Corporation l(Florida; forf Florida Power's First - Mortgage generation is charged to expense as Power), a public utility engaged in the Bonds. burned. The cost of nuclear fuelis amor-
- generation, transmission, distnbution L tized to fuel expense based oq the quan-f and salel of electric energy within Utility Revenues, Fuel and Purchased tity of heat produced for the generation
- Florida. Power Expenses -- Florida Power of electric energy in relation to the quan-Jaccrues the non-fuel portion of base The' consolidated financial state
- tity of heat expected tn be produced revenues.for services rendered but nu I u co w t - ments combine the financial results of unbilled.
ithe Company and its majority owned operations. Allsignificantintercompany _ Revenues include amounts resulting -- Earned income on Finance Leases --
from f uel and conservation adjustment The Company uses the finance meth-
- balances and_ intercompany.transac-
- tions have been eliminated.- clauses, which are designed to permit ' odforrecognizingeamedincomefrom g _
fullrecoveryof thesecosts.Theadjust- finance leases, which are primarily ilnvestmentsin 20% to 50% owned ment factors are based on projected leveragedleaseshavingtermsof three '
y joint ventures are accounted for using costs for a six month period. Revenues to 22 years Accordingly, earned in-the equity methodJ . .
and expenses are adjusted for differ- come, including any residual values ex-
!Certain reclassifications have been ences between recoverable fuel, pur- pected to be recognized, and tne related c madetoprioryearamountstoconform chased power and conservation costs deferred investment tax. credits are 110 the current yeart presentation.
- and amounts included in current rates. a mortized as revenues over the term of n
r
the transaction to provide an approxi- timing ditferences discussed above for charped with the cost. less the net sat-mate level return 07 the positive net which deferred income iates have not vege, of property units retired investment. been provided. When Florida Power Allowance for Funds - The allowance incomeiaxno - Deferred income tanes records these re ductions in deferred in- for funds used during construction have been provided o: all significant come ta xes, a net egulatory payable for represents the estimated cost of capi-book tax timing differences. except dur, the amount will also be recorded and tal funds (equity and debt) apphcable ing periods when applicable regulatory there wdl be no effect on net income. to utihty plant under construction.
authofities did not permit the ret very Flonda Power expects to recognize Recognitionof thisitemasacostof viil of such taxes through rates charged to these tax effects in future consumer ity plant under construction is appropri-customers by Flonda Power. rates when such timing differences ate because it const itutes an actual cost The cumulative net amount of in_ reverse. of construction and. under estabhshed come tax timing ditferences for which Depreciation and Maintenance - The regulatory rate practices, Flonda Power deferrect taxes have not been provided Company provides for depreciation of is permitted to earn a return on these v.as app'oumately $100 million at De- the cost of properties over their esti- costs and to recover them in the rates cember 31,1991. As allowed under uur- mated useful lives primanly on a charged for utihty services whlie the rent regulatory practices, de' erred ta xes straight line basis. Florida Power's an- plant is in service.
not previously provided are collected in nual provision for depreciation, includ- The average rate used in computing customers' rates as such taxes become ing a provision for nuclear plant the allowance for funds vas 8.0% for payable. decommissioning costs and fossil plant 1991.1990 and 1989.
Def erred investment tax credits sub- dismantlement costs, expressed as a insurance Premiums, Policy Acquisi-Jectio re gulatory accounting proctices percentage of the average balances of tion Costs and Benefit Reserves - Life ai a being amortized to income over the depreciable utihty plant was 4.8% for insurance ptemiums are recognized as livesof therelatedproperties. Addition- 1991 and 4.0% for 1990 and 1989. revenue over the premium-paying peri-ally, deferred investment tax credits Effective December 1,1990, Fiorld od of the pohcies. The Company defers associated wnh finance lease transac- Power was authon7ed to apply new recov?rable costs in its insurance oper-tions are being amortized to revenues depreciation rates which resulted in a attons that da ectly relate to the produc-as descobed above. $37.2 milhon increase in annual depre-tion of new business These costs are Financial Accounting Standard No. ciation expense for 1991. Pnor to the amortized over the expected premium-96, " Accounting for income Ta xes" was authonzation, Flonda Power had apphed paying penod. Reserves are estabbshed issuedin December 1987 and mustbe interim depreciation rates, which in- out of each premium payment to pro-adopted by the Company no later than creased depreciation expense by $14.8 vide for the present value of future 1993 if not superceded by a pending million during the first nine months of insurance pohey benefits using reason-proposed exposure draf t. The objective 1990. T he etfeet of the intenm rates was able assumptions for f uture investment of this standard is to recognize the recarsed at the direction of the Florida yield. mortahty. withdrawals and the nsk amount of current and jeferred taxes Pubhc Service Commission (FPSC)in of adverse deviation.
payable and refundable for all events the fourth quarter of 1990. Dunng 1991, that have been recognized in the finan- the FPSC completed an invest: gabon of Profit from Real Estate Sales - Profit allinvestor owned electric utihties into f rom the sale of realestate is recognized cial statements based on enacted tax the need to provide currently for fossil only upon the closingof a safe. the trans-laws at the date of the financial fer of ownership rights to the purchaser statements, plant dismantlement costs in May Tt'e Company has determined 1991, the FPSC approved Finrida nd receipt of an adequate cash down preliminanly that the adoption of the Power's motion to defer the implemen. payment.
standard will not have a significant im- tation of any additional derreciation Marketable Securities and Financial pactonearningsintheyearof adoption expense associated with this matter un- Instruinents -- The Company considers l and will result in a rec # tion in deferred til Florida Power s next proceeding for all highly hquid debt instruments pur-income taxes on '.he Compa.1y's Dal- review of base rates. Florida Power filed chased with a matunty of three months ance sheet. Substantially all of these a request for an increase in base rates or less to be cash equivalents. Fixed in.
! reductions in defe"ed income taxes are in January 1992. come secunties are carried at amor-applicable to Flo ida Power and result Flor da Power charges maintenance tized cost and other equity securities from timing differences for which de- expense with the cost of repairs and E u stated at the lower aggregate of cost ferred income taxes have been provid- minor renewals of property. The plant or market value.
ed in prior years at tilher statutory rates accounts are charged with the cost of At December 31,1991, the market and the tax effect of deferred invest- renewals and replacements of proper- value of marketable secunties exceed-ment tax credits, partially ofisct by ty units Accumulated depreciation is ed book value by $3.7 million e
.m., . . . _ . . . ....._......m.-- . . . . _ _ . . , - - - - , . _ _ . . . . _ . . . . . .
g.,,
l In accordance with its hquidation plan, Progress Credit sold $118.4 milhon of bank commitments. Le ed on the marketatMe secunti?s during the year for a pretax gain of $14.5 milhon. maturity of the underlying backup kne The Financial Accounting Standards Board issued Statement No.107, " Dis- of ered.t, PC Ts commercial paper bal-closures about Fair Value of Financialinstruments,"in December 1991. This state- anceof $24 .1milhonatDecember31, ment requires disclosure of fair values for financia; instruments and is affective 1991 was classified as long term.
for the Company in 1992. Tne C ompany's major financialinstruments include trade 1 he combined aggregate matunties accounts receivable and payable, marketable secunties, leases and loans receiv- of long-term debt for 1992 through cble, and debt. The Con'pany has not quantified fair values for all of these items. 1996 are $65 3 milhon, $112.6 milhon,
$75.5 milhon, $105.2 milhon, and (2) DEBT The Companis short term debt atDecemt>cr 31,1991 and 1990 consist?d of the following: $361.5 milhon, respectively. In addi-1990 tion, most of Florida Power's First 4 un mahons; 1991 Mortgage Bond issues have an annual commercial paper $7s o $139 2 Ba% borromngs - 402 9 1% sinking fund requif ement. These m- .4 36 0 requitements. which total $5.7 milhon sf6.4 1575.1 for 1992, $5.5 milhon annually for The Company's long-term debt is scheduled to mature as follows: 1993 through 1995 and $4.9 milhon internt for 1996, are expected to be satisfied pn mdhans) Rate 1991 1990 with property additions.
Morw1a Foner CorporaSon. Flonda Power is in the process of Fest mortgage bonds refinancing all of its outstandin g annu-Mat n tnrough 1996 al tender bonds. The new benr1s will
, , 3 3 1995 4 74 % (aj 34 4 34 4 bear interest at 6.62F.% and mature in Matunng ;997 through 2001 7 82% W 162.2 162 2 2027.
Matunna 2002 throup 2006 7 92% M 310.0 310 0 Dunng early 1991, PCH estabhshed
" new, private $NO-milhon medium-eN e of oscount. oe'r.g amoruemer term ot t,onas .7 2.7 ter m note progra m wit h matunties that U17 523 7 may range frorn nine months to 30 Guarantee of pauton controi revenue t>onds years. At December 31,1991, up to Matanng 2000 inrougn 2014 8 64% m 132.4 132 6
$226 milhon of notes may beissued un-nr a t er t>onds matunng in 2012 anc 2013 5 00% w 108.6 los6 g gg 199M992 8 15 s 20.0 35 0 ing rates.
1993 1997 6 43% w 139.s 235 0 Fionda Progress has a support c mm rebIp suoported t3 revoher matunng W" # # "U Novemner 30.1996 4 94% w 247a - par ent company to maintain a net worth Nates maturmg at PCH of $ 150 milhon as of Decer 7er 1991 1992 8 50 % 10 0 227o 31,1991. PCH's net worth was $ 155 1993 2001 516% (a) 242.3 68 3 34.0 46.2 m % on.
Progress Leasing Corporation (att due mthin 5 yws) 9 5R W Otner subsid4 anes. cett matsong througn 2007 to 91% ia) 40.8 52 7 ggpgggpgggg 5I3 STOCK AND SHAREHOL. DER RIGHTS tess: cunent cordon coong term cett ,
The Company has 10 million shares nu mm of authonzed,butunissued, Preferred W v,mgnteacrage eterest rate at Decemoer 3L 99i Stock without par value issuable in se-The Company's consohdated subsidiaries have knes of credit totahng $817 ries. The first senes, designated Jun-milhon, of which $ 700 milhon is used to support their commercial paper f acilities ior Participating Preferred Stock, was and $100 milhon is a backup for the utility's annual tender Londs. The lines of created in 1991 but remains unissued.
credit were unused as of December 31.1991. Interest rate options under hne The Junior Preferred Stock is entitled of credit arrangements vary from sub pnme or money market rates to the pnme to quarterly dividLnds equal to the rate. 8anks providing knes of credit are compensated through f ees. Comrnitment greater of $10 00 per share or 100 fees on knes of credit vary between .1 and .225 of 1%. times the per share common stock divi-The knes of cred:t, which were put into place in November, c 'nsist of four res olv- dend and is entitled to 100 voting rights ing bank credit facihties, two each for Flonda Power and Progress Capud Hold- per shar e held . Florida Power has 4 mil-ings, Inc. (PCH). The Flonda Power facilities, $200 million each. are for terms of lion shares of authorized Cumulative 364 days and five years. The PCH f acihties consist of $ 100 milhon with a 364 day Preferred Sttck, $100 par value, of term and $300 milhon with a five year term. These facihties replaced previous which 2.3 milhon shares are outstand-B
Ing.in addition, Florida Power has 1 million shares of autherized but unissued Pref er- $65 milhon of unamortized nuclear f uel, ence Stock, $100 par value, and 5 million shares Of Mthorized but unissued and $313.4 million of accumulated Cumulative Preferred Stock, without par value. depreciation, which includes $85.2 mil-Minimum preferred stock redemption requirements during the next five years lion of accumulated provisions for are $2.5 million in 1992 and $12.5 million yearly in 19c i *hrough 1996. A sum- decommissioning costs. Each par-mary of outstanding Cumulative Preferred Stock of Flo..Ja Power follows: ticipant provides for its own financing.
cutstanding at Florida Power's share of the operating current Dwidend Redemption shares December 31 costs is included in the appropriate ex-Rate Pnce Autnanzed outstanding 1991 1990 pense captions in the consolidated Un Mons? statements of income.
Without sinking fu% not subject to rnEdatory redemption.
4 00 % $104 25 40.000 39 980 $ 4.0 $ 40 Plant Decommissioning Costs -
4 40% $102 00 75.000 75,000 7.5 75 F!orida Power's nuclear plant deprecia-4.58 % $101.00 100.000 99.990 160 10 0 tion rates include a provision for f utJf e 4 60 % 1a03.25 40.000 39.997 4.0 40 decommissioning costs that are -
recoverable through retes charged to 7 a) 3 3 30 3 customers. Florida Power i= olacing its 7.76 % $102 9s(b) 500.000 500.000 50.0 50 0
'00 collections in a managed trust f und. T he 8 80% $ 10100 200.000 200 000 20.0 recovery f rom customers, plus interest
, (( earned on the trust fund, are intended with sinwg runds, subiect twanaatornecemptm to be suf ficient to cover Florida Power's 7 08 % $104 72(ci 500.000 500.000 $ 60.0 $ 500 share of the future dismantlement, 7.84% $ 107.84(d) 500,000 500.000 50.0 50 0 removal and land restoration costs.
100.0 100 0 Florida Power has a license to operate tess current portion 2.5 -
the nuclear unit through December 3, S 97.5 $100 0 2016, and contemplmes decon. mis-(a) $102.48 afser August 15.1992 (b)$102 21 after February 15.1994 estimated to be approximately $211.2 (c) $102 36 after Nosember 1" 1996. $100.00 a'ter November 15.2001 milhon in 1991 dollars, Decommission-(d) $103.92 after N:Nember ib, 1992. $101.96 a*ter November 15< 1993, $10a00 after N> ember 15.1994 ing expense, as authorized by the FPSC in November 1991, the Company adopted a Shareholder Rights Plan. By adopt- and Federal Energy Regulatory Com-ing this plan, the Company has issued and attached one right to each outstanding mission (FERC), was $11.8 million for share of common stock. Each right entitles the registered holder, upon the occur- 1991 and 1990 and $9.8 million for rence of certain events, to purchase from the Company, at the exercise pnce of 1989. A new decommissioning cost
$130.00, one one hundredth of a share of the newly created class of Junior Par. study was submitted to the FPSC in Sep-ticipating Preferred Stock, as described above. In addition, upon certain occur- tember 1991 which estimated total f u-rences, the rights may be exercised to purchase shares of the Company's, or a ture decommissioning costs to be surviving entity's, common stock. Alternatively, the Board may approve a stock $2931 mdlinn in 1991 dollars. If the issuance to each holder sf rights, with no cash payment by shareholders The rights results of the new cost study are ap-have no voting or dividend rights and expire December 2001 unless redeemed proved by the FPSC and FERC, annual earlier by the Company decommissioning ex pense is expected to be $16.3 million.
(4) NUuLEAR OPERATIONS Fuel Disposal Costs - Florida Power Jointly Owned Plant - In 1991, Florida Power exercised its option to purchase bas entered into a contract with the U.S.
the City of Sebring's .45% interest in the Crystal River Nuclear Plant. The purchase Department of Energy (DOE) for the price, currently in negotiation, will be approximately $2 million. Florida Power's transportation and disposal of spent nu-90% ownership in the nuclear unit as of December 31,1991 amounted to $575.6 clear fuel. Disposal costs for nuclear million of utihty plant in service, $63.1 million of construction work in progress, fuel consumed are being collected D
= - - - - - - - __ ____-_
e
. pneuMomers tbrough thof uet adjust- (5) LEASIS AND ' CANS F.ECEIVAllLE AND CONCENTRA110N OF CREDil RISK nymy suc et a sta of $ 001 per net At December 31 1991 and 1990, investments in leases and loans re:eivable nucWr germ reuwuatt hour andare were as follows: ,
paid to the DOE quarterly. Flonda Pow' 0" '*0N') 1991 1990 er is cur rently stunng r, pent nuclear f uel r r, ave ions on site bhd has sufficient storage ce Letas n>ce aw $240.s tx25 pacity in place or r inder construction for [,'j',*[,'*f"##' # l8 gg 9d fuel butned through the year 2009. cce,,comtmenua. nem m .): 033i Tow re,mve imes 143 s ~E77 Plant Refuling Outages - Florida toani rec e Power accrues a reserve for main- CommW fire x e tw,ew 275 3 3180 tenance and refuebng expenses antici- I d' j',*[y,',, m gg pated to beincurred dunng scheduled g,i,n un, ,g to o nuclear plant outages. A planned mid- 30v p, ,m,v,,,, ion,, 24 o ao _
cycle maintenance outage, which te,ui m eme 2993 nas 3 occurred f*om October 10,1991 to %,,,g, ,o, iosso 9 0.51 00 0 Novemt,er 25,1991, resulted in a cost (22.7 sm of $9,5 milhon to Flonda Power. The next tus current nortion c21 175 3
~
refuchng outage, scheduled for eight lutauuns antnoans rematne 4600 6 $ 516 9 weeks beginningin April 1992,is pres.
ently estimated to cost $23 9 milkon. Rentals receivable f rom finance leases represent unpaid rentalt less pnncipal and intere'it on non recourse 1hird party debt participation. Progress Credit Corpo.
Insurance - The Price Anderson Act ration's (PCC) share of rentals receivable is subordinate to the share of the debt currently hmits the habikt) of an owner participants who also have a security i'nterest in the leasrd property, Finance leases pnmanly consist of leveragert investme 1ts in aircraf t as descobed of a nuclear power plant for a single below. The majonty of the aircraf t leases have terms of 15 to 20 years, with a maxi-nuclear incident to $7.8 billion. Florida mum of 22 years. Net contractual matunties of rentals recmvable under these con-Power has purchased the ma6 mum tracts are $15.1 milhon, $12 million, $14.1 milhon, $16.3 milhon and $14.7 million available commerc'al insurance for 1992 through 1990, respectively, and $1686 milhon thereaf ter Deferred taxes
$200 million with the balance pro apphcable tc leveraged leases were $28L5 million 9nd $271 milhon at December I
edbyindemnityagreements prescr1 31,1991 and 1990, respectively, bnhe U.S. Nuclear Regulatory Commit Net income recognized f rom leveraged leases (af ter payrnents to non recourse sion. in the event of a nuclear incident lenders, but before other borrowing costs) were as follows:
at any U.S. r.celear power plant, Florida - en mmono
~
1991 1990 m9 Powercoulu be assessed upto $66 mil- tease income poss) s (,73 gio i 59s lion per incident, with a maximum as. income tai ertett ,e p 4) 0 4!
sessment of $10 million per year, in I"# ' "' '*'omeno ne 20 29 44 addmon to this liabihty insurance, Florda Power carries extra expense in- At December 3L 1991 and 1990, PCC s portfoho included investments in the urance witt Nuclear Elecinc Insur* althne and commercial real estate industnes as follows:
41ce, Ltd (NEIL) to cover the cost M n mmiono 1991 i990 replacement power during prolongw outages of 1 he nuciaar unit. Under thit Finase sensn $252 A $259D pokcy, Flonia Pc..er is subject to a toans rece vaue 112.0 160 9 retroat.tive prenim as sessment of up Annt venturn amnregaaered stock 48.8 50 5 hemmt on ouratmg inw to 6 11, 4_
to $ 2.8 milton in any yea 'in which policy lossesexceed accumulv,edpremiums .
5423.8 Su27 and investment income. cvnmerciai real (state incustr>-
Finance leasu $ 18 0 $ 19 6 Isans recewabie 163.3 1370
$ 181.3 5156 6 b
1
l PCC's commercial finance loans to with their new terms at year end and the restructurings did not materially reduce entitles associated with the airkne in- PCC's future annual revenue.
dustry are secured by hens on aircraf t. During 1991, PCC provided $16 4 milhon for possible loan and lease losses and aircraf t engines or spare parts. These had write-of fs totaling $6 milhon.
loans are f urther collateraheed, w here leases and it ans are generally placed on non accrual statcs when the collect-applicaW, by an assignrnent to PCC of ibMy of interest or principalis unc ettain. T he following table summar~es all com-the borrowers' iease agreements with mercialfinariceinvestments of PCC,which as of Der ember 31,1991 or thereatter third party users of the secured equip. were on non accrual status The aircraf t leases returned te an accrual status in ment and, in some ;ases, third party January 1992 when the first payment was received under the restructuring.
guarantles. Ponew amount Potent >al annaaoevenue
""*""*""*"' '* d"" *" D' "
PCC'sloans teceivable from borrow- 52 '
ers engaged in commercial reat estate j g 1 [ d"' Sy {'
activities are secured by first raortgage ug3,, %,, 33 4 3o hens on the related commerciai real e s- g g4g3 g,3 tate, assignment of lease 6 and select-ed third party guaranties. InaGditiontotheabove.PCCforeclosedona 55 4 milliontcalestateloanduring in September 1991, the Company 1991 and is currently marketing the prope'ty f or resale. PCC has one outstanding announced thatPCCwouldbegin na or, loan for $14.9 million which maintained mgoing interest payments dunng 1991 .
derly withdrawal f rom the commercial but became dehnquent as to principal awwnty. PCC received f ull repayment of leasing and lending industry. No new this loan in January 1992.
transactions will be initiated. and PC C's portfoho of leases, loans and other (6) INCOME TAXES
- """'"U 3* N 1%,
investments wi'l be reduced as the portfolio matunties and market oppor- components ohncome tu emense tunities permit. N'#"""enth redmai $ 99.6 5 641 $ 411 Due to conditions in the air kne indus. state 14 1 13 ', 67
-~
try and a weak realestate market, PCC us3 97 0 UT^
has experienced dehnquencies in on- y,,,,,g g,,y %
goinglease and loan payments as well m erg ~ 029) 70 41 6 as toan principal matunties. PCC has state .4 30 f: 6 riegotiatedthe restructunngof certain 02.51 10 0 00 4 transactions. PCC will pursue its options Sm,w;cn g nutment un ueon iwt ~ 04) UW - M for any non performing assets, includ-sL5 lon 6 UT ing restructuring, remedial actions a nd in benems related to d'scontinued operations .4 18 32 remarketing. T he Company beheves the g gg g ~ 1102 4 5 020
- existing reserve of $20 million is ade- gy,n,,,ng , g og, yo.,y _
quate to cover PCC's plarined ortferty Dmerence betmen taascianind tn accounting for teees 51s4 5 401 $ 44 0 bquidation, assuming no f urther deteri- Accelerated over (under)i, trac 1 kne tn cepreciation (2 4) 71 25 7 oration in the airkne and real estate unenecoery meneccuem ot tuet ew gro) t4 0) 12 3 industries, Nnn eduaw .nnm ut pa) 6 3) m overt +ad esponse capohted for tn pu'mes (3.5) O 1.9) $ 0)
PCC's port' oho at December 31 omerence set.een nnecs ano in acu,unang to, 1991 includes $54 miuion of aircraft propent sa;es 1.s ao aa Finn through of ce:tened .ncone tai regs - -
a c) leases to Continental Airlines which 2.5 49 ph were restructured in 1991 PCC's port- D"'""*'" " # " " ***'""'""""'**">tmad p 2) 013) oths ,12s) foho also includes approximately $86 4 5 100 5 504 milhon of restructured aircraf' loans t0 Pegasus Capital Corporation, a compa- The pomary ditferences between the statutory rate and the etfective incorne tax ny in which PCC has a 12% minority in- rats:s are detailed below:
terest. In addition, PCC has received lost 1990 1%9
$8millioninpartialprincipalf ayments G,rautautori income tauate 34.0 % 34 0% 34 0%
on a $35 million restructured real es- state income in. ret of iederat income in benefits 3s 39 35 tate loan and anticipates f ull repayment Amonmon nhnetment tn vests p.5) ph p ?)
U"* th'0"Eh d "d'"'d '"""* I" **"O - -
RO upon the expected sale of the collater. om um 16 Om al propertyin 1992. Alt restructured as- nn M " " "'d"'" 32 % 30 3%
sets were performing in accordance _
O
! i l
l l
I
- (7) HCTIREMENT BENEFIT PLANS l The Company and certain of its subsidiaries have a non contributory defined T he f ollowing weighted average actuar-l benefit pension plan covering substantially all employees. Thrt"agh December 31. tal assumptions were used m calcu-1991, the benefits were based on length of servic e. compensation . Ming the highest lating the plan's year end funded status:
l ce nsecutive 60 of the las,120 months of employment and social security ber,efits.
j Ltfective January 1. '992, the compensation portivo of the benefits formula was 1991 1990 l i changed to the highest consecutive 48 of the last 120 months of employment. l 1 he operating companies make annual contnbutions to thc @n based on an actu. De re 7.25% 6 m l
j arial determination and in consideration of tax regulations and funding require, Ee hmteu.aton mm E00% m
- ments under federal law.
]
Baterien Lctuarial calculations and the f unded status of the pension plan the F nancial Accounting Standaril No.
- Company was not required to contnbute to the ptan for 1991.1990 er 1989 Shoun 10Gf Employers Accountingfor Post-
! below are the components of the net pension cust (benefit) calculations fe" nose fetirement Benefits Other Than Pen-
! years:
sion3.. was issued in December 1990 j en maw 1991 1990 1h9 and ls ef f ective 1or the Company begin-sernte cut.t 5 la 9 $ 101 5121 ning in 1993. Th.s standard requires
) interest est 22 4 21 1 18 5 that en employer's obbgation f 0: post- ;
t Actuanosses kar ungsj on pian nsets (91. 4) 19 2 K41) retiremen t benefits t e f ully accruco by l Net arnurtaation and deferral 6h o (% N 32 0 the date e.nployees atIain f ull chgibili- ;
I Net pense cost (bene',0 2.9 ( 41 (1 L) ty to receive such benefits. The Com- !
r Reguiston ac ur,tment (2. 0 4 14 pany and certain of its subsidiaries :
- Net pension cost Ibenet.n recognaed 5-8 2 5 '1( provide Certain heaitn care and iif e in- ,
j surance benehts f or retired employees.
T he following weighted avclage actuarial assumptions were used in the calcula. Employaes becomo ehgible for these .
I tion of pension costs: bene 11ts when they reach normal retir e-ment age while working for the Com- l l Int 1990 Ina pany. Assuming the plan bent < < a will Dn. count rate 8 t,0 % 7 50 % B?g remain as amended In January 1992,
- t apected long term rate rst return 9 00N 9 00% 9 00 % the Company has estimated that its ha- r hte of compenuton innease 600% 67s% 67% bihty at January 1,1993 would be be-tween $ 120 million and $150 million.
The following summarites the funded status of the pension plan at December 31 The Company plans to accrue f his obh- [
1991 and 1990: gationowra20 yearpenod TheCom-pany's ochcy since January 1,1985 has
, on maeno 1991 wo been to accrue benefits currently pay- -
Accumutate benet,t congation able along with amortitation of past m ted $2241 1156 4 service costs of current retirees. The Non4esteo 32 s 24 7 Company hasaccrued $21.4 milbon at
) .
256.9 1813 December 31.1991 using this meth-r Effect of remettee comoensaton innea*s 94.1 80 3 od The Company forecastsits annual ,
Prweeted benett ou4gmon 35 o 261 4 cost for 1993 willincrease from aoprux-Pia, anets at ma+et vave. poma% i stea staas and corporate and imately $5 milhon to detween $20 mil-government donas 435 o 354 o lion and $25 million under the new emn aswis in eeest of pro,ertnt benett ou. rate $ r.s.o 5 W6 standard and expects that a substan.
consisting of ine fouceg companents tial portion would be recoverable f rom unrecogneed transit.on asset 5 ss 2 5 601 customers through base rates. Florida Cf e t as t ns and d>tterence between a.tue and
- d N" #5
- U l estnnatoo essener.ce 35 3 319 January 1992 request for rate relief.
j $840 $ 92 6 ;
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I I (0) BUSINESS SEGMENTS decreased 1990 rctail revenues by '
T he Company delines its principal business segments as utility anti diversified $12.5 milhon and net income by $7.8 operations.Theutihtyisengagedinthegeneration, transmission distobutionand milhon. [
j saleof electncenergy.Thediversifiedsegmentincludescoalmining procurement As indicated in Note 1, the FPSC .
{ and transportation operations that have sWfeant sales to the utility. Other con. deferred implementation of higher t!nuing diversified operations include Oct U ; leveraged leasing, commercial depreciation of approumately $O 4 mil-
{
l finance, life insurance, real estate and ' +A gy, hon to provide for additional fossil plant
- The Company's business segment ' an for continuing operations for dismantlement costs until florida Pow-1991,1990 and 1989 is summarized be w. No single customer accounted for er's next proceeding for review of base ;
f more then 10% of unaf filiated revenues intra segment sales have been climinat. rates
, ed and the Company's equity in the earnings of partnerships and #nt Ventures in January 1992, Florida Power (ded :
! has been included in revenues. a petition with the FPSC requesting a ,
mo retail rate increase of $1459 milhon j vni nono 1991 Im T he request is based upon a dual. year test penod that includes 1992 and h 51.71s s $13091 519 t 0 1993. The petition also requested in.
j o,g,o
, Dectnc Fuem corporabon terimrehef of $31.6millionbasedonthe ,
- coa! saw to eiettnc utrirty PtL2 2%2 294 3 12 month penod ending November 30, btemai customm 197.1 1715 In t 1991. implementation of the r,s w rates l Otner dwpes is t .1 130 6 150 1 resulting from the higher annualized 2.339.2 22964 2.196 9 revenue requirements presented in the Dmmatens (264 si ab5 fa pe$ 6) petition are timed to coincide with the ses from enternal customen SLO 74.7 52 010 6 51 % 3 Completion of new peaking facihties in intc,r..e trom operaton$ 1992 and 1993. The new rates would t 5 369.8 5 3779 5 3032 recover higher environmental protec- ;
Dectoc Fucis Corporate 17 4 17 7 17 7 Uon cosh M a co@ng syskm pWCt.
- other owemf+d 38.2 38 5 27 3 adrhtsondl other postretire ment benefit i
435 4 434 3
~
408 2 costs Mccordance with new account-intercat ena ether einen',e 149.0 l$19 1301 ing standards and the inflationary im-
- income from contmurg crerates before neome tales s 266 4 5 2822 5 2781 pact on operating expenses since the utility'slastratesncrease. Adecisionon the permanent rate request is expect-
$"[ ***
3 7 g 7, g3 333 3 g3'4 3 3 g o g ,o edin September 1992. Unless granted Dectnc rue 4 Corporate 260.4 2% 4 2113 eacher, tne interim rate request, which *
! Other awest+d 1.101.6 12717 965 3 is subject to refund, automatically be-55,024 9 $5 045 9 54 61u 4 cemes ef fective May 1,1992, pending i Dep<eciation and amortaaten t 5 241.9 5 140 4 5 177 9 Wholesale Rates - Flonda Power 's rate
, Dectnc fueis corporat on 17 6 12 9 90 treatment of its wholesale customers otner dnemf+d e6 41 47 was consistent with the rate treatment s 266.3 5 2074 5 1916 of its retail customers for both 1990 and
' N Howm .n M, whoksab captai, y on.
o E d W a W aH UtAty 5 359 7 5 2765 5 2008 i
oyero es customer billing credit that was discon-Ekttnc fuers Corporation 26 9 19 7 16 6 tinued for retail customers.
i otner dweved 90 31 2 40 9 Flonda Power plans to file a request I
5 397 6 5 3274 5 3183 with the FERC in Apol 1992 seeking comparable 1992 rates for its whole-(9) RATES AND REGULATION sale customers, consistent with its re.
Rctall Rates -In December 1989, the FPSC voted to continue a customer billing tait rate petition.
credit that was sched*d to expire on December 31,1989. The FPSC took this I
action in response to horida Power's regulatory rate of return. The onginal credit Fuel Cost Hearings - in December
! related to the pass-through to customers of a deferred income tax savings from 1988.the FPSC began hearings to con.
tax rate reductions. In December 1990, the FPSC voted to discontinue the cus- sider contentions of flonda Power's tomer bilkng credit, effective January 1,1991. Continuance of the bilkng credit largest industrial customer and others O
A
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1 l
l that certain procurement and transpor- sil and nuclear f uels and to r esers e pipe- will default and not come on hne if au tation activities by Electric Fuels One capacity for natural gas. In most units were to come on hne as contract.
Corporation wereimprudent in August cases. such contracts contain provi- ed caer the next 5 years, the utihty ee !
1989, the FPSC disalicwed approw sions for pnce escalation, minimum pects to incur annual capacity i
mately $ 5A nuthon. plus interest. in f uel purchase levels and other financial pay ments. bast.d upon such generation costs. As a result,1989 net income w a s commitments. Additional commit- being available. The annual capacity reduced by approdmately 55 milhon ments will be required in the future to payments are $10 million. $25 milhon.
Fionda Power ref unded the disallowed supply Flonda Power's fuel needs $ 82 milkon. $195 milhon. 5228 milhon costs to customers as adjustments to Flonda Powzr has entered mio long. and $230 milhon for 1992.1993.1994.
J the fuel charge dunng 1990. term contracts with The Southern 1995.1996. and 1997 through 2025. !
In January 1990, the FPSC dis- Company for up to 400 megawatts of respect r,ely. l a!! owed recovery of certain af hhated purchased power annually through Flonda PoAer does not plan to eo j coal costs. w hich reduced 1990 results 2010 representmg approximately 5% cred the lesel of purchased power et by $2.5 mdhon i his ruhng resulted f rom of total current system capabihty. The currently has under contract. The utik-i adopting a market based pncing meth- power will be supphed by coal fired ty beheves that its current contracts odology for recoverable fuel costs for generating units which have a cem. allow system reliabihty and should not '
purchases from an affikated coal bined capacity of approumately 3.500 weaken its overa:1 credit ratings suppher. megawatts. The entire comm tment is Currently, the FPC.C allows the cost in November 1991, the FPSC ruled guaranteed by The Southern Com- of purchased power to be recovered in f avor of Flonda Power by refusmg to pany's total system which is approw through a FPSC ordered fuel adjust-disallow $40 milhon in incrementai re- mately 30.000 megawatts The long. ment clause, placement fuel costs incurred during term contracts obhgate Flonda Power Off DalanceSheetRisk-Severalof the outages at the Crystal Riser Nuclear to pay certam mmimum annual Company's subsidiaries are general Plant. T he decision concluded a lengthy amounts representing capacity par partners in unconschdated partner-lovestigation initiated by the Of fice of ments 1he estimated annualcapacity ships and joint ventures T he Company Public Counsel seeking to have the payments under the contracts are $22 or subsidianes have agreed to support FPSC disallow incrementa leplac ement milhon. $39 milhon. $48 milhon and certmnicanagreementsof thepartner-fuelcosts for outages dunng 1988 and $ 63 rmlhon for 199.7.1993.1994 and ships and joint ventures The totals of 19b9. 1995 through 2010 respectively. the debt support agre ?ments were $84 In June 1991, the FPSC ordered a T he total cost (energy and capacityi milhon and 5113 3 mahon at December f.eparate review of two other outages af the power purchased under these 31.1991 and 1990, of which $11.2 mil-that occurred in late 1989 and 1990- contracts was approximately $42 mil. lionand $14 mm on were cash deficien-Th0 it cremcatal cost of replacement hon and $47 rnilhon dunng 1991 and cy agreements ar'd $.691 milhon and f uelfor these cutages is approonately 1990. respectivelb of which $22 makon $92.9 m3then were guaranties. respec.
$17 milhon. F lorida Power has fi'ed tes' and $19 milhon represented the f ned to W As a general partner, those sub.
timony with the FPSC supportingits po- capacity payments, respectively, a ar rs are potentially hable for all the sition. A decision is es pected in 1992. As of December 31.1991. Flunda partncisNps' obhgations. If the other Management beheves that any amount Power has entered into long term con partners failed to perform thair obhga-of replacement fuel costs thet may be tracts with non utthty electricity gener- tionsandif thepartnershipassets. con-disallowed would not be material ators for 1.095 megawatts of capaaty. sisting pumanly of ;and and buildings.
(10) COMMITMENTS AND These contracts have terms ranging s.ere worthless. those subsidianes CONTINGENCIES frota 20 to 35 sears in most cases could be hable for an additional $ 131.6 Utility Construction Piogram - Sub- these contracts acccunt for 100% of mdkonesof December 31.1991.which stantial cornmitments have been made the generating capacity of each of the represents partnership liabihties ed in connoction with Flonda Power's con- f acihties. Of the 1.095 megaAatts un- ceeding amounts as mentioned above.
.itru ction pr ogra m, which a re presently der coi. tract,178 megawatts are cur- The Company considers these credit estimated to result in construction em rently on kne and the remaining future risks to be minimal based upon the as-penditures in 199.? Of $489 ndlhon for capacity is a part of the utihty S plans set values supporting the partnership electric plant and nuclear fuel. for meeting future electocity demand habihties.
Fuel and Purchased Power Commit, growth. A9 commitments have been Retroactivelnsurance Premiums- As ments - To tupply a portion of the f uel submitted to, and substantially all hJn e mentioned under Note 4, " Nuclear requirements of its generating plants. been approved by the FPSC. However. Operations" Flonda Power is subject to Flonda Power has entered into vanous Fionda PoAer expects thet approxi- retroactive premium assessments in long term commitments to pros ide fos- mately 25percentof thefutureprejects connection with its nuclear insurance.
G m .
I j in addition, Florida power currently car- Florida Power's degree of responsibile building products companies by early j ries approximately $1.8 billion in prop. ty if any,appearstobesmalhnrelation 1992 and recorded an additional $2.4
. erty ensurance provided through several to the total for the large number of milhon provision for k>ssesin 1991 net I
d!fferentpohcies.Oneof thesepohcies, *potentially responsible parties" in. Of tax benefitsof $1.4 milhon,basedon i which is also underwntten by NEIL pro- volved. Based on the current status of ine final tales pnces for the companies vides $1.25 bilhon of excess coverage. these matters, management beheves The Company received cash and notes Under this policy, Flonda Power is sub- the hkehhood is remote that these ac- totakng $29 2 milhon in 1991 related ject to a retroactive premium assess- tions will result in a material sdverse ef. to these sa!cs, and is scheduled to re-ment of up to $.6 7 milhonin any pokey fect on the Company's future financial ceive an additional $22 4 million in
]
year in w hich los ses exceed f unds avail- condition. 1992, T he Company is also otternpting I
able to NEIL to sell certain real estate holdings total-(11) DISCONilNUED OPER All0NS Waste Disposal Site Cleanup - Florida in October 1990, the Company an. ing $10.4 milhon previously used an the
! Power has received severai notices trom nounced its intention to seihts butiding building products opercions.1ne
! thc U.S. Environmental Protection Agen. products operations as part of its stra. accompenying financial statements ao cy (EPA) that it is a "potentially respori- tegic planning elfort to review the long. Count for theJe companies as ' Dis.
sible party" under the Comprehensive term direction of the Companv. The continued Operations:' Accordingly.the i l Environmental Response Compensa- Company provided for the disposition results and balances related to this seg- i tion and Uabihty Act and the Superf und costs and f uture operating losses ol the ment have been segregated from the l Amendment and Reauthorization Act building products segment in 1990 ongoing operations of the Company in
> and may be required to share in the cost which reduced earn ngs by $14.2 mil. the accompanying financial statements I of cleanup of waste disposalcitesiden hon, net of apphcable las benefits of for aH years pmsented. i tified by the EPA, in each instance, $1.7 milhon The Company sold all the n s a j ,
QUARTERLY FIN ANCIAL. DATA (Unaudited) ynree Monm., tegen f i (in means. nr est per shme wrounN Mwch 31 June 30 septemper 30 owemt>er 31
- 1991
, Rwenues $ 4 56,0 1528.1 5 5 H9.4 $500 6 l locome from operations P 7.0 100,1 148.3 74.0 24.5 i Net income 33.o 43.1 71.5 l Earnings per average common share: l Continuing operations .64 .80 1.30 .46 <
Disco"inued operations - - -
( .0 4 l l Pet income .G4 .80 1.30 .44 DMdends per et,mmon bhme 08s .085 .08s .71 4 Common stock price per share
' High 40% 41% 44% 47%
Low 3GN 38% 38% 43 1990 ,
Revenues $ 448. 2 $489 9 $5918 $4809 income from operatens 76 4 107 1 152 9 97.7 Net income 29 1 43.7 58 1 33 9
- Eamings per merage common share i Continuing operations .57 BG 1 41 66 Discontinued operations -
J ol) ( 28) .-
Net income 57 .85 1 13 _ _
66 ;
Dividencs per common share 66 06 66 685 Common stock pnce per sharc High 40% 3H% 37% 39 Low 37 35% 33% 33%
The business of the Cornpany's largest subsidiary, Flonda Power, is seasonalin nature and it is management's opinion l that comparisons of earnings for the quarters do not give a true indication of overall trends and changes in the Companyt
' opcrations, As explained in Note 1 to the financial statements, Florida Power reversed $14.8 milhon of interim depreciation in the fourth quarter of 1990 previously recorded in the first three quarters of the year. This increased fourth quarter income by $9.2 milhon.
i Due to the timing of common stock issues and the seasonal nature of the Company's qu, erly earnings, the sum of the 1991 quarterly earnings per share do not equal the annual figure.
U l -
1 I i -
i SELECTED DAT A 1 987- 1 99 1 f FLORIDA PROCHESS CORPORATION i (DMars in msitains. en ept ter shwe amountsI i
=
l j ribe ktsf i Annual Growth 1
(en percent) 1991 1990 1989 1988 198r
[
Summary of operations: I
- Utikty revenues 2.3 51,718 8 $ 1,709.1 $ 1,627.0 $ 1,468.5 $1,472.'? -
l Diverrified revenues (continuing) 13.9 355.9 301.7 274.3 270.1 2A3.5 l
! Income f tom continuing operations (.7) 174.5 179.8 186.I 178.6 184.1 !
L Income (loss) f rom dscont'nued operations (2.4) (15.0) 1.0 1.2 3.7
' l Not incomo (1.0) 172.1 164.8 187.1 179 8 187.8
)
Balance sheet data:
$ 5,024.9 }
l Total assets 5.4 $5,0 45.9 $4,610.4 $4.272.3 $4.067.2 !
l Capitalization: i j Short-term capital 10.3 $ 146.2 $ 681.0 $ 498.6 $ 366.5 $ 269.0 :
Long-term debt 5.0 1.581.1 1,326.2 1,125.8 1,048.8 1,093.0 Preferred stock (.2) 231.0 233.5 233.5 233.5 233.5 j Common stock equity 6.5 1,587.7 1,424.3 1,372.3 1,316.9 1,264.7 Total capitalizhtio_n 5.4 $ 3.54 6.0 $3.665.0 $ 3,230.7 $2,965.7 $2,860.2 i Capitalization ratios-Short. term capital 4.1 % 18.6 % 15.4 % 12.4 % 9.4 % !
}
l 1.ong term debt 44.6 36.2 34.9 35.4 38.2 Preferred stock 6.5 6.4 7.2 7.8 8.2 Common stock equity 44.8 38.8 42.5 44.4 44.2 Common stock data: ,
Average shares outstanding (in milhons) 2.0 S 3.9 51.3 bl.1 51.1 50.3 Earnings per share; Utikty . (2.0) $3.05 $3.22 $3.28 $ 3.31 $3.30 '
Diversified (10.5) .19 28 .37 .19 .37 Continuing operations (2.6) 3.24 3.50 3.65 3.50 3.67 !
Discontinued operatinns (.04) (.29) .02 .02 .07 l l Consolidated (2.9) 3.20 3.21 3.67 3.52 3.74 :
Dividends per common share 3.7 2.765 2.665 2.58 2.50 2.42 ,
Dividend payout 86.4 % 83.0 % 70.3 % 71.0 % 64.7 % '
Dividend yield 6.0 % 7.2% 6.6 ?'. 7.3% 7.6%
Book value per share of commun stock 4.3 $28.72 $27.55 $26.83 $25.80 $24.77 '
Return on common equit/ 11.4 % 11.8 % 13.9 % 13.9 % 15.5 %
Common stock price pe, shato:
High $47% $40% $40% $37% $43% ,
Low 36% 33% 33% 32 29%
Close 47 38% 40 35 32% i Price earnings ratio (year.end) 14.7 11.9 10.9 9.9 8.8 Other year.cnd data: !
Number of employees (1.8) 7,350 7,879 7,490 7,974 8,116 Number of common s!"ireholders (2.0) 42,176 41,970 43.005 44,929 46,147 ,
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{ _ _ _ _ _ _ _ . _ _ _ _ _ - _ _ _ _ _ _ _ _ _ _ _ - _ . -
SELECT ED DATA 198 1 -
1 99 1 FLORIDA POWER CORPORATION i
Annual Growth Rate 6 (rn perceng 1980-1991 1961 1991 1991 1990 1989 Electric sales billed (millions of KWH):
Residential 5.2 5.0 12,623.9 12,415.5 11,786.9 Commercial 6.1 7.2 7,489.2 7,328.7 6,989.8 Industrial 1.1 -
3.303.0 3,455.7 3,766.1 Other 6.0 5.4 1,763.0 1,678.4 1,580.5 Total retail sales 4.9 48 25,179.1 24.878.3 24,123.3 Sales for resale (8.2) (6.7) 2.171.1 2.265.4 2,387.2 ,
lotal electric sales 3.4 3.1 27,350.2 27.143.7 26,510.5 Residential service (average annual):
KWH sales per customer 1.7 1.3 12,257 12,319 12.059 Revenue per customer (0.3) 1.7 $899 $896 $845 Revenue per KWH(in cents) (2.0) 0.3 7.33 7.27 7.01 Financialdata:
Total capitalization (in milkons) 3.4 3.2 $2,692.2 $2.633.4 $2.4 73.9 Capitalization ratios +:
Short term capital 83.8 C.3 4.2 % 7.4 % 4.7 %
Long term debt (3.9) (3.0) 38.5 38.7 40.2 Preferred stock (3.3) (2.8) 8.7 8.9 9.4 Common stock equity 2.7 3.5 48.6 ' ' , .0 45.7 Ratio of earnings to fixed charges (SEC method) (2.0) 2.0 3.87 3.89 3.79 Embedded cost of 10' . Orm debt (2.2) (1.6) 7.8 % 7.9 % 8.1 %
Embedded cost of preferred stock (3.0) (1.5) 7.2 % 7.2 % 7.2 %
Operating data:
Net winter generating capability (MW) 2.1 2.3 6,623 6,5 - 6,309 Net system winter peak load (MW) 0.3 1.8 6,056 5.Deo 6,817 Net system summer peak load (MW) 5.0 3.1 5,925 5,946 5,832 BTU per KWH of net output 0.3 (0.3) 10,007 10705 10.07G Construction additions (in millions) 12.7 (0.7) $355.3 $269.5 $254.8 Percentage of construction expenditures generated internally (2.1) 7.2 90 % 52 % 73 %
Fuel cost per million BTU (2.5) (4.9) $ 1.89 $2.11 $ 2.10 Average number of customers 3.4 3.7 1,159,237 1,135.499 1,101,817 Number of regular employees 1.3 2.3 5,677 5,570 5,553 (a) capita!@ tron grcrwth reces cdculated on to* si Uollar arnounts.
0
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r 1968 1987 1986 1985 1984 1983 1982 1981 11,065.6 10.318.8 9.819.2 9,175.0 8.553.6 8,009.5 7.425.0 7,752.3 6,479.4 6.016.4 5.573.0 5,106.6 4,547.7 4.118.6 3,895.2 3,735 2 3,680.6 3,349.4 3.122.3 3,160.0 2.989.0 2,701 0 2,715.5 3,288.3 1,466.1 1.355.0 1,319.3 1,268.4 1,188.8 1,142.9 1,094.9 1,038.5 22.691.7 21,039.6 19,833.8 18,716.0 17,279 1 15,972.0 15,130.6 15,814.3 3,439.2 3,064.1 3,336 2 2,556.4 3,317.3 5,802.0 4,739.3 4,322.2 26,130.9 24,103.7 23,170.0 21,272.4 20.596.4 21,774.0 19,869.9 20,136.5 >
l 11,754 11,356 11,255 10,940 10,638 10,388 9.964 10,758
$814 $827 $914 $883 $818 $783 $720 $763 6.93 7.28 8.12 8.07 7.09 7.54 7.23 7.09 ;
[-
t
$2.359.5 $ 2,341.0 $ 2,27 5.6 $2,350.2 $2,328.0 $2.305.4 $ 2.200.3 $ 1.971.5 t
10.3 % 6.9 % .2 % 5.0 % 20% 2.7 % 1.6 % 1.9 % i 34.7 39,7 46.9 45.4 51.4 51.2 53.8 52.0 9.9 10.0 10.3 11.3 11.5 11.9 12.5 11,5 45.1 43,4 42.6 38.3 35.1 34.2 32.1 34.6 3.79 4.08 4.29 3.81 3.07 2.94 2.42 3.19 l 8.0 % 8.1 % 8.7 % 8.8 % 9.2 % 9.1 % 9.6% 9.2 %
i 7.2 % 7.2 % 8.4 % 0.3 % 9.3 % 9.3 % 9.3% 8.4 %
l 6.086 5,966 5,961 5,989 5,927 5,993 5.899 5,255 6,188 5,087 5,977 5,813 4,858 4,913 5.347 5,088 !
5,309 5,196 4,644 4,548 4,163 4,610 4,086 4,355 9.985 9,954 9,865 9,928 10,074 10,082 10,383 10,357
$201.1 $ 192.8 $195.2 $201.2 $234.5 $285.8 $385.3 $379.8 100 % 96% 100 % 100 % 99% 66% 39 % 45%
$ 1.83 $2.09 $ 2.14 $2.63 $2.36 $ 2.85 $2.78 $ 3.12 l- 1,060,971 1,023.222 980,427 940,976 900,799 861,548 829.810 802,787 l 5,512 5.395 5,323 5.216 5,070 4,923 4,829 4,533 I
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D I R E C T O R S A N D 0 F F l C E R S BOARD DF DIRict0RS Dr. Jack B. Critchfield. 58. Is Chairman of the and Southern flonda Corporation and Jim Joan D. Ruf flei 52. is a General Partner in Sua Board and Chief Executive Officer of Florida Walter Corporation A company dnector since shine Cates. an ortando based food andlever.
Progress torporation He served as a fionda 1991. he ss a member of the Compensation age concession busihess, which has Power Corpor ation duettor f rom 1975 to 1978 and finance & Budget Committees Operations at two Ilorida airports A certif ed betore joining the utikt) in 1983. He is a daec' public auountant, she is a former chaaman tor of Bar nett Banks. Inc. in Jacksonville, F lon- Clarence V. Mc Kee. 49 is Chairman and Chief ard oWgms oN> tate NW o
Executwe Officer of WTVT Hold:ngs. loc .which da and Bamett Bank of Pinellas County in St.
Ow ns W TVT.T V Channel 13 in Tampa. F londa tenof Honda %madoecWroWCa&
Petersburg flond3 Acompanydaectorsince Heisa daectorof BarnettBankof Tampa.N A sonde anch of me MalRese m Bad 1988. he is chairman of the Executive Com- of Atlanta A company d: rector since 1990, she ndBarnettBanks,Inc mJachsonville Acom-mittee and is also a merrber of the finance is a member of the Aumt Commith e
& Budget Committee or W 1989 N 4 We d the Compensation Committee and a member Lee H. Scott. C5. is a retaed Vic e Chaaman of Michael P. Graney. 48. is a Partner in the law of the Nominating Committee Ilonda Progress He also f.erved as President firm of Simpson Thatter & Bartlett in Col- and Chief Executwe Officer of Flonda Power Clarence W. McKee. Jr ,67, as a retaed Emecu- before his promotion to Fionda Progress in umbus, Ohio. Speciakting in ut.1: ties Iw. ht,.
gation and antitrust, he is a member of the tive Vice President and Chief F mancialothem 1988. He is a daector of Sun Dank of lampa of flondaProgress HelsChaamanof theBoard BW and has served as a c ompany d: rector smce Arnencan. Distoct of Columbia. Ohio and of Trustees of Bayfront Medical Center in St Columbus Bar Associations as well as the 39g4 Petersburg A fionria Power daector since 1976 federal Energy Bar Association. A company R M 59. m
- W w e director since 1991, he is a member of the a a o nc d
ar d Chief Executwe Of ficer of Mid Continent Compensation Committee. Ufc insurance Company m Ontahr;ma City, Richard Korpan. 49, is President and Chief Corneal B. Myett 70,is a Partner and Prese which Fionda Progress acauned in 1966 A Operating Officer of flonda Progress Heloined dent of the law f am of Pettrson.Myersl.raig. company daector since 198fa. he is a member the company an 1989 as Executive Vice Prey Cren% Brandon & Puterbaugh, PA in Lake of the ExecutNe Cnmmittee.
dent and Chief financial Officer. He previously Wales. flonda. A flonda Power daector since Jean Giles Wittner. 57 is Presdent of Wittner served as President and Chief Esecutive Of f o 1978 and a company duector since 1982, he & Company, aninsuranc e consutting and real cet of Pacific Diversihed Capital Company, a is a memt er of the Audit. Compensation and e state management fir m io St . Petersburg She subsidiary of 5an Diego Gas & Electric Com. Finance & Budget Comnuttees previously strved as President and Chief En-pany A company daector since 1989. he is a Richard A. Nunis. 59. is Chairman of WNt D, ecu'we Of hcer of a savmgs association ;ntal member of the Executwe and the finance & ney AttrartionsinOrlando,fionda Heisadire it was sold en 1980 Sheis a director of Colony Budget Comm:ttees tor of T he Walt Disney Company and Sun Bank. Hmk in Ciearwate'. Flonda A Finnda Power N A, in Orlando A company director since daector since 1977 and a company daettor Dr. Robert F. Lanalliotti. 70. is Dean Ementus of the Graduate School of Business Admin- 1989,heischaamanof thefinance& Budfet sue 1982AheisMaamanof the AuditCom.
Istration at the University of flonda in Gaines- and Nommating Committees and a rnember m:ttee and is a member of the Estec utNe and ville, flonda. He ss a tormer daector of Citizens of the Executive Committee %minating Committees Off)CERS Dr. Jack B. Critchfield Kenneth E. Armstrong Allen J. Keester, Jr.
Chaamaa and Chief Executive Officer General Counsel President and Chief Executwa Off cer, Richard Korpan Jeffrey R. Heinicka flonda Power Corporation Presidert and Chief Operatirig Officer Vice President and Treasurer Richard D. Keller Joseph F. Cronin Dan R. Johnson President and Chief Esecut ve Of t cer.
Vice President and Controller Electnc Fuels Corporation Executwe Vice President Darry; A. LeClal, Riley R. $1 mon David R. Kuzma Senior Vice President and Vice President. Mergers, Acquisitions Presloent and Chief Executive Of ficer.
and Divestitures Mid Continent Ufe Insurance Company Chief financial Officer Joseph H. Richardson Stephen D. Purifoy Dudley E. Bryant Senior Vice President, Secretary President and Chte! Evecutive Of ficer.
Corporate Develonnant and Advanced Separation Technologies President and Chief Executwe Of ficer, incorporated Talquin Corporntion Thomas D. Wilson Acting President.
Progress Credit Corporation R
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PROGRE55PLUS MCChEESRED ED DilillilI i I I I I YlTCKI4 AN
( mce enroked in the plan. pat acipant,s The Progresh Plus Stock Plan Florida Progress Corporation an may reolaces the company s dividend rein.
nounced its new Progrtss Plus Stock N Automaticalh reinvest all oc a pot tion vestment and stocn purchase pian Plan in Februcy 1992. Progress Plus of their quarterty dwidends an com Sharenolders in that plan e utomatical is an economical, convenient end fie" mon stock ly become participants in the new plan ible way to purchase shares of Flonda W Makedirectcash purchasesof com- M adminisuaw co@m N plan am Progress common stock mon stock paid by the company Those ebgeble f ^r the plan are A Progress Pius Stock Plan pro A safekeeping service for common spectus and other 'nformation can be O Registered sharehola.ers stock ceruficate . is also off erec to elirn ot tmned by returning the reply crd in D Non-shareholders who are Flonda inate v + . n ,f lost c'ertificates Since the f tont of this annual'epo. t or by call-tesidents shares oeposited foi safekeeping are ing inetor services toll tree (800)
D tmployees of the corrpany and its treated as Progrers Plus shares they g ) g,) l subsidianes may be sold throuph the plan G
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l I UTILITIES COMMISSION
( CITY OF NEW SMYRNA BEACH, FLORIDA lI
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l Financial Statements
.g and Auditor's Report I September 30,1991 and 1990
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UTILITIES COMMISSION CIT ( OF NEW SMYRNA BEACH, FLORIDA FINANCIAL STATEMENTS and INDEPENDENT AUDITORS' REPORT September 30,1991 and 1990 OFFICIALS Jesse L. McKee, Chairman James U. Martin, Vice Chairman G. Fred Heise, Secretary Treasurer Heyward A. Paxton, Jr., Assistant Secretary Treasurer James A. Pence, Commissioner DIRECTOR OF UTILITIES R. Ronald Hagen CONTROLLER Valois Pagan, CPA LEGAL COUNSEL INDEPENDENT AUDITORS Bolt, Spence & Hal!, P.A. Brent Millikan & Co., F.A.
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TABLE OF CONTENTS COMPONENT UNIT FINANCIAL STATEMENTS Septernber 30.1991 and 1990
. UTILITIES COMMISSION, CITY OF NEW SMYRNA BEAcil, FLORIDA NEW SMYRNA BEACH, FLORIDA Rclerence .hscs INTRODUCTORY S!!CTION Title Page .. .... . ..... r . . . . . . . . . . . . . . -
I Organi:a tic n Cha rt.. .. ... .. .. .... ... .... .... . ................................. ill Certificate of Athievement..... ... ...... .. ........ ............-. iv Letter of Transmittal.. = ...............~.... . . . . . . . . . ~ . . . . ....... = . . . . . vx FINANCIAL SECTION Component Unit Financlo! Statementst Independent Auditors
- Rept. rt.. ... . ... . . . . . . .. . . . . . . . . . . . . . = . .. . . . . . . . . 1 Compara tive Balance S heets ......... .............. .. ._.. ._ . .... . - -.. . . . . . . . . ~ . . . . . . . . Statement 1 23 Statements of Revenues, Experees and Changes in Retained Earnings.- .........~......... Statement 2 4 Statements of Cash flows - ........... ........-.. ..........-.-. Statement 3 5 Notes to the Financial Stotements..... .. .... ..... ..... ..o.................<- . . . . . . . . . . . . . . 6 15 Supph: mental Detail Information of the Electric. Water, and Pollution Control Systems:
Schedule of Revenues, Expenses and Changes in Retained Earnings..... ..... ... .... . . . Schedule 1 16 Schedule of Ruenues. Receipts. Expenses and Disbursements . Budget and Actual .
Electric System (Non-GAAP Budgetary Basis)s-. =................ Schedule 2 17 Schedule of Revenues. Recclpts. Expenses and Disbursements Dudget and Actual .
Water System (Non GAAP Budgetary Basis)............ .......>.. Schedule 3 18 S:hedule of Revenues. Receipts. Expenses and Disbursemen' !!udget and Actual -
Pollution Control Systern (Non GAAP Budgetary Basis) . ..... . . . . , . . . ........... Schedule 4 19 Schedule of Operating Expenses . Electric System..- .. .................... Schedule 5 20 Schedule of Operating Expenses . Water System.. .. ..-- .......~....-......- Schedule 6 21 Schedule of Operating Expenses . Pollution Control System Schedule 7 22 Schedule of Interest Earmngs......... . . _ . -
.........................= . . . . . ...... Schedule 8 23 Schedule of Debt Service Requirements To Maturity . .... .... .. . ...... . . -. ...... .. . ... .. . . Schedule 9 24 25 STATISTICAL SECTION Schedule of Expenses by Function last Tv /iscal Ye,1:s... .. .. ......... ....... . ................. Table ! 26 27 Schedule of Rever.ies by Source . Last Ten Fiscal Years = :.. . . . . . . . . . Table !! - 28 29 Demographic Statistics . Last Ten Fiscal Year 3.............. ... -
........................................ Table !!! 30 Property Value. Construction and Bank Deposits Last Ten Fiscal Years.. Table IV . 31 Schedule of Insurance in Force.. ..... ... . . ... . Table V 32 Ten Largest Electric Customers. ..... . ......... . ~ . . . . . . . . Tab!c V1 33 Ten largest Water Customers _... .. . . . . . . . ~ . . . . . . . . . . . . . . . . . . . . . . . . Table Vll - 'M General Utilities Commission Informatfort z . . . . Table Vall 35 37 Selected Five-Year Historical Information:
Compara tive Balance Sheets...., .. .. . ............. ... ...... ... -..-. . - .- .
. . . . . _ , . . . . . Table IX 38 39 Statements of Revenues, Expenses and Ch:mges in Retained Earnmgs.. ... .. .. . .......... Table X 40 Statements of Cash Flows .. . . - - - . Table XI 41
.. ......u.. =.- ....... Table XII 42 Selected Se[ement Sehedule o Revenue Information Certificana Coverage. .. = . . . . . .-
Table XI!! . 43
' Schedule of Selected Financial Ratios. . .. .. . ...... . Table XIV 44 f
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ORGAN /ZATION CHART-
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ORGANIZATION CHART UTIUTIES COMMISSION, CITY OF NEW SMYRNA BEACH, FLORIDA NEWSMYRNA BEACH, FLORIDA Utilities Commissioners Professiona Director Commission Consultants Of Attorney Utilities Electric Engineering Finance Water / Pollution Department Department Department Control Department iii j
l CERT /F/CATE OF ACH/EVEMENT forthe YearEndedSeptemberJa 19N The GosemmentFkrance CatersAssocht&1 ofthe Unt?MStates anctCanada (GFCA) anardeda Cert /ficato of Ach/ovement for Excellence in Fkt-ancialReporting tothe Utihtk?s Commissdi, Ci.y ofNewSmyma Beach, Fht-kta foritsCwnprehenskeAnnualFhanch/RepcytforthefiscalyearendedSe;>
lember3Q 19%
/n orde:10 be awardex1a Certilbate ofAchiesvment, agoremmentalunitmust pubbsh an easiV readable and emc/catV o,pank:dcwnixehensisv annual /ki-anch/mport nt1Dhcwitentscarforrntopmgramstandards. Suchreportsmust satisVbot/1 genera $axeptedaccounik?gpthicp/esandapp/ table kyalMc7u/-
terrents.
A Cettikate ofAchiusementis vahdforape7MofcvreyearcytV. Afanagement bebeves that this report cont #1ues to cw1/ oms to Certiftate c/Achies vmtvil Pto-gmmstandards
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Achievement
- or .2XCe. enCe In cinanCla.
Repor:ing Presented to Utilities Commission, City of New Smyrna Beach, Florida ,
For its Component Unit Financial Report for the Fiscal Year Ended September 30,1990 A Cert!hcate of Achievement for Execuence in Financial Reporting 15 presented by the Government Finance Ofhcers Asaociation of the United States and Canada to government units and public employee retirement systems whose component unit hnancial reports (CUFR's) achieve the highest standards in government accounttog and financial reporting.
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l a g ) i President Executne Director iV
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LE77ER GF TRANSM/TTAL
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CilY Of NLW SMYHNA liEACil. I tORIDA LtICIHIC, WATLR. l'OLLUllON CON 1tlOt.
1%t Offk e Box 100 + 120 Sams Ave. $i?
New Smyrna ticuh. Florida 32170 0100 (904)427 1361 b December 4,1991 To the Chairman and Members of the Utilities Commission City of New Smyrna Beach, Florida The Component Unit Financial Report of the Utilities Commission, City of New Smyrna Beach, Florida, for the fiscal years ended September 30,1991 and 1990, is hereby submitted Responsibility for both the accuracy of the presented data and the completeness and fairness of the presentation, including all dis- 5 closures, rests with the Utilities Commission. To the best of our knowledge and belief, the enclosed data are accurate in all material aspects and are reported in a manner designed to present fairly the financial position and results of operations of the Utilities Commission. All disclosures necessary to enable the reader to gain the maximum understanding of the Utilities Commission's financial affairs have been in-cit.ded.
This financial report is presented in four sections: introductory, financial, statistical, and compliance (Auditor General of the S: ate of Florida). The introductory section includes this transmittal letter, the Utilities Commission's organizational chan, and a list of principal officials. The financial section includes the basic financial statements and the independent auditors' report on the financial statements. The statistical section includes selected financial and demographic information, generally presented on a multi year basis, and selected five year histe,rical financial information.
The Utilities commission is recluired to be audited in accordance with Chapter 10 550, Rules of the Auditor General of the State of Flonda. Information related to this audit, findings and recommendations, and auditors' reports on the internal control structure and compliances with applicable laws and regula-tions, are included in the comp!!ance section of this report.
REPORTING ENTITY AND SEllVICES pilOVIDED The funds and entities related to the operation of the Utilities Commission which are included in these financial statements are a component unit of the City of New Smyrna Beach, Florida, and an integral part of the Citys repomng entity.1he Lomponent Uni; Financial Reymt of the Uti"tus C:,mminian h inued -
separately to provide a con.prehensive financial reporting summary and presentation to the Utilities Com.
mission and its revenue certificate holders.
Audited financial statements of the City of New Smyrna Beech, Florida, are available upon request from the City of New Smyrna Beach,210 Sams Avenue, New Smyrna Beach, Florida,32168.
The Utilities Commission, City of New Smyrna Beach, Florida, provides a full range of electric, water and pollution control services to its customers both inside and outside the city limits. These activities are fully accounted for in this financial report.
ECONOMIC CONDITION AND OUTLOOK The economic condition and outlook of the Utilities Commission have continually improved during the past several years due in large to the controlled development of residential and cottmercial properties which in tum has ineceased the Commission's quality customer base. In addition, substamial increases in the local tourism, light manufacturing, and service related business industries have had a positive effect on the area's emplcyrnent statistics.
v
To the Chairman and Members of the Utilities Com nission City of New Smyrna Beach, F.orida December 4,1991 page 2 MAJOR INITIATIVES The Commission has established a five year capital imrovement plan for the period from October 1, 1989 through September 30,1994. The capital expenditures of this plan were scheduled to be financed in two phases of $15 million each. The first phase of this plan is cu Tently being financed from the proceeds of Utilities System Revenue Certificates, Series 1990, issued in January 1990. The second phase of this plan will be financed from the sales of additional Revenue Certiacates in 1993. This five year capital improve-ment plan is in addition to the annual capital requirements for routine extensions of exis:ing utilhy facil-ities to serve new customers.
Significant system improvements financed from the Series 1990 Utilities System Revenue Certificates and the future 1993 Revenue Certificates will consist of the following:
o A new 30 MVA electric substation located in the northern part of the Commission % electric service area and approximately 4 miles of 115 kV transmission line; o Approximately 11 miles of 115 kV electric transmission line linking the Commission's Smyrna sub-station to the Florida Power Corporation's castern service territory bounda:y; o Expansion of a water treatment plant in conjunction with the scheduled expansion of the Commis.
sion's well field areas; o Construction of a treated water transmission line; o Expansion and upgrading of existing treated water distribution liner; o Development and constmetion of a phased water reuse system which consists of tertiary treatment of the wastewater treatment plant ef0uent along with pumping facilities and transmission lines to provide irrigation service to prospective customers; and o Pollution control facilities improvements consisting of the construction of a small pollution control treatment plant, construction of wastewater collection lines and a wastewater pumping station, and the installation of a computerized wastewater telemetty system.
In addition to the improvements identified above, the Commission also plans to refund an existing ob, ligation payable to the Florida Municipal power Agency (FMpA) Based on the repayment schedule, the October 1,1993 outstanding balance on the loan will be $2.8 million. The proceeds of this loan were originally used to finance utility upgrades and relocations resulting from a state highway project.
FINANCIAL. INFORMATION Mana;;ement of the Commission is responsible for establishing and maintaining an internal control srmeture designed to ensure that the assets of:he Commission are protected from loss, theft or misuse and to ensure that adequate accounting data is compiled to allow for the preparation of financial statements in conformity with generally accepted accounting principles. The internal control structure 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 andjudgements by management.
Budsernzy Comm/s The Utilities Commission maintains an integrated system of budgetary controls. The objective of these budgetary controls is to ensure compliance with legal provisions embodied in the approved annual budget.
The operating activities of the electric, water, and pollution control systems are included in the annual vi
s To the Chairman and Members of the Utilities Commission l City of New Smyrna Beach, Florida i December 4,1991 l Page 3 budget. The level of budgetary control (thst is, the level at which expenditures cannot legally exceed the appropriated amount)is established by fune:lon and acthity within each individual operating system. The Commission also maintains a separate encumbrance accountirg system as one technique of accomplishing budgetary contrel. This system is used exclusively to maintain budgetary control and is not utilized for i,urposes of presenting financial :tements prepared in accordance with generally accepted accounting prmelples.
As is demonstrated by the financial statements and schedules in the financial section of this report, the Utilities Commission continues to meet its responsibility for sound financial management.
Un14*Opmnhn i
in compliance with Resolution No.16-75, the electric, water and pollution control systems are accounted for as a single enterprise fund. As of September 30,1991, the Utilities Commission served 18,835 electric customen,9,865 water customers and 7,754 sewer customers. Service totals for the last five .
years are summarized below:
a Fiscal Electric Water Sewer
. Year Accounts Accounts Accottnts 1987............................... 17,025 8,828 7,036 1988................................ 17,440 9,115 7,289 1 9 8 9 . . ... . . . .. . .. . . .. . . . . . . . . . . . 18,045 9,509 7,556 -
1990 .. .... .. . . . . . . . . . . . . . . . . . . . 18,531 9,757 7,701 1991................................. 18,835- 9,865 7,754 The current I crease of 7.12%over year's lastoperating years $28,112,213. revenues from The the combined increase was caused utilities by systems general totaled $30,113,258, economic growth an in.
throughout the year. The amount of revenue from various sources and the increases overlast year are shown in the following tabulation:
Increase (Decrease)
Amount Percent Over 1990 Operatinc Revenue Source f 000 s) of Total f000's)
Electric system.. . .... . ... . .. .. $24,262 80.57 % $1,900 Wa t er syst em ....... ...... ............ .. 3,414 11.34 109 Pollution control system . .-.... .. . 2.432 3.92 (H) -
, TOTALS.: ...... 100.00 % $2,001
..... .. . ..., ${0} 13 The current year's operating expenses from the combined uti!! ties system totaled $27,721,286, an in.
crease of 4.05% overlast yeate ad,iusted amount of $26,642,379. Increases in the levels of expenses for the - ,
individual systems over the pre,eding year are shown in the following tabulation:
vil i
1
---wr.,-- # -,r,,-.,- ..,,n,,, , y -- 3, 4 -,-n ,-,,-%,.w.my-pw,--,,,,,.,-,,,m.--,,.,,- y-.--,6%. wen,-,-w,..y,, ,.,w,,yv 3 , , , , ,.w~,n,mw,,we,,wwm,-e,-
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. To the Chairman and Members of the Utilitf(s Commission City of New Smyrna Beach, Florida December 4,1991 Page 4 Increase Arnount Percent Over 1990 Ooeratine Expenses by Function f000's) of Total 1000's1 Electric syst em ....... .................... 522,143 79.87 % $839 Wet er syst em ......... .. ................. 2,354 10.30 103 Pollution control system ........... 2.724 .. . 9.83. 132 !
TOTALS .... .... ...... .. ....... .. .. $27,721 100.00 % $1,079 i DebtAdanhhtra&n -
The revenue certificate debt coverage ratio is a usefulindicator of the Utilities Commission's debt posi.
tion. The cunent yeat's revenue certificate coverage is 1.83 times and is summarized in the following
. tabulation: >
t Operatin g revenue ... ... ... ..-... ... ............ .. $30,113,258 Interest and other lacome .. .. ...................... 876,320 Connectionfees . .-... ............ 756.866 Assessment colleetions ...... ......... ......... ...... 36.239 Revenue percettificate resolution ......... ..... _ $31,782,683 Cost of Operation and Mainternnce (net of depreciation and required payments to '
th e City) ..... ..... . . .. ....... .. .... . . .. ...... .. . .
23.440.Q2fi . _
Net revenue per cenificat e resolution ......... 8,342,655 e
Annual debt service requirement... ............ 4,570,972 Coverage ratio ....... . . . . . . . . . . . . . . . 1.83 Times The Commission's revenue cenificate coverage ratio for each of the l~t five fiscal years is presented in Table XIll of the accompanying financial report.--
. As of September 30.1991, the Utilities Commission had outstanding $50,810,000 of revenut certificates payable. All of these obligations are secured by a first lien on and a pledge of the net revenues of the system.-
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t l
To the Chairman and Members i
of the Utilities Conunission !
City of New Smyrna Beach, Florida December 4,1991 page 5 i in connection with the issuance of the Utility System Revenue Certificates, Series 1990, the Commission received an upgrade ofits ratings from Moody's, and Standard & Poor's as follows:
Magdy's Standard & Poor's Utilities System Revenue Refunding and improvement Cenificates, Series 1978 A A.
Utilities System Revenue lmprovement Certificates, Series 1986 Aaa AAA (FGlC Insured)
Utilities System Refunding Revenue certificates,5eries 1987 Aaa AAA (AMBAC !nsured)
Utilities System Revenue Certificates, Series 1990 Ana AAA (AMBAC Insured)
The debt service requirements on these obligations are detailed in Note 6 to the financial stateraents.
CashManapment Cash temporarily idle during the year was invested through the use of a competitive bid procedure in short. term time deposits and medium short. term investments. Shorter irrestment periods were utilized by the Utilities Commission due to the rapid changes and uncertainties of interest rates experienced during the fiscal year. The amount ofinterest earned during the year was $1,417394.
The Commission's investment policyis to minimize credit and market risks while maintaining a com-petitive yield on its portfolio. Accordingly, deposits were either insured by federal depository insurance or collateralized in accordance with the Florida Security for Public Deposits Ac((the "Act"). All collateral on deposits was held either by the Commission, or by the State of Florida in accordance with the applicable 1 provisions of the Act. All of the Commission's investments held at September 30i1991, are classified in the categotv oflowest credit risk (backed exclusively by the full faith and credit of the United States govern. '
ment) as defined by the Governmental Accounting Standards Board.
OTi1ER INFORMATION IndependentAudk Resolution Number 28 78 and other local and state statutes require an annual audit of the books of account, financial records and transactions of all administrative depanments of the Utilities Commission by an independent cenified public accountant selected by the Utilities Commission. The accounting firm of Brent Millikan & Co., P.A., Cenified Public Accountants, was selected by the Commission to satisfy this requirement. Theirindependent auditors' report on the financial statements and schedules of the Commis.
sion has been included in the f'mancial section of this repon.
Awards Cem?IcareofAchiewment The Government Finance Officers Association (GFOA) awarded a Certificate of Achievement for Ex.
cellence in Finencial Reporting to the Utilities Commission, City of New Smyrna Beach, Florida, for its component unit financial repon for the fiscal year ended September 30,1990. We are also quite proud of the fact that we have been awarded with this Certificate for the thirteenth consecutive year.
ix
To the Chairman and Members of the Utilities Commissian City of New Sm)Tna Beach, Florida December 4, . 91 Page 6 In order to be awarded a Certifierte of Achievement, the Commission must pubikh an easily readable and efficiently organized component unit annual financial report, whose contents confonn to program standards. Such reports snust satisfy both generally accepted accounting principles and applicable legal requirements.
A Cert!ficate of Achievement is valid for a period of one year only. W selieve our current report con-tinues to conform to Certificate of Achievement prog-m rec;uirements, and we are submitting it to GFOA to determine its eligibility for another certificate.
Acknowlehrnena The preparation of this report on a timely basis could not have been accomplished without the efficient and dedicated services of the entire staff of the Finance Department. Each member of the department has our sincere appreciation for the contributions made in the preparation of this report.
We woold also like to thank the members of the Utilities Commission for their interest, support, and leadership in planning and conducting the financial operations of the Utilities Commission in a most responsible and progressive manner.
Respectfullysubmitted, 3
fQ . - -W y R. Ronald Hage , Valois pagan [CpA t
Director ofli ilfies Controller '
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F/NANC/AL SECT /ON '
77thsecthn/s ccr7@MedoftheMUwk19:
/ndyrvidentAud?om'Rtyxvt Conywien!UnitFhunter/St :ements Sum /muyitalInbmutbn
INDEPENDENT '
AUDITORS' REPORT
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,- .- , ,---,y - .,
I BRENT MILLIKAN & COMPANY, P.A.
CERTIFIED PUllLIC ACCOUNTANTS To the Hororable Chairmat, and Commissiorm J'ilities Commission, City of New Smyma Beach, Florida New Smyma Beach, Florida lHDF. PENDENT AUD1 TORS' REPMRI We have audited the accompanying balance sheets of Utilities Commission, City of New Smyrna Bea;h, Florida, as of September 30,1991 and 1990, and the related statements of reveres, expenses and changes in retained earntngs, and cash Hows for the years then eded. These financial statements are the responsi-bility of Utilities Commission, City of ::ew Smyrna Beach, Florida, management. Our responsibility is to .
express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing standards and Gwcvment Auddby Stand.m/s, 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 misstatement. An audit includes examining, on a te>t basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting prin-ciples used and significant estimates made by managaent, as well as evaluating the overall financial state-ment presentation. We believe that our audits provid. a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the hn.
ancial position of Utilities Commission, City of New Smyrr.a Beach, Florida, as of September 30,1991, and 1990, and the results of its operations and its cash flows for the years then ended in conformity with gener-ally accepted accounting pnnciples.
Our audits were conducted for the purpose of formmg an opinion on the basic financial statements taken as a whole. The suppleme-tal and statisticalinforma; ion are presented for purposes of additional analysis and are not a required part of the basic financial statements of Utilities Commission, City of New Sinyrna Beach, Florida. Tha 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.
In connection with our audit, nothing came to our attention that caused us to believe that Utilities Commis- c sion, City of New Smpna Beach, Florida, was not in compliance with any of the terms, covenants, provi-sions, or conditions of section 16 of Resolution No. 28-78 dated June 30,1978, as amended. However, it should be noted that our audit was not directed primarily toward obtaining knowledge of such noncom- ,
pliance.
New Smyrna Beach, F13rida December 4,1991 1
205 MAGNOLIA ST.
- P.O. HOX 1226 a NEW SMYRNA BEACH, FL 32170-1226 * (904) 427-1333 a 1 AX (904) 427-5823 i MW R. Amenm housute of Cemhed Pwblu Arrountams and AK P\ Prhete Compames P,4ctice b tmn
4 COMPONENT UN/7' F/NANC/AL STATEMENTS
a i
e e, . S ' 4 COMPARATIVE BAIANCE S11EETS -
September 30.1991 and 1990 -
~
UTILITIES COMMISSION, C11Y OF NEW SMYRNA BEACH. FLORIDA
_ NEW SMYRNA BEACH, FLORIDA ASSETS 1911 _19 90 . . .,,,
Utility Plant Electric plant m ...m..z . ..-.. . ... . .. m... ... . . . . . . . . m.... $44.096,918 $41,448486 Water plant ..m. . .m.. . ., . .~.. ... . .-....m.~........................... 16,164.983 15,990,608 Pollurim contrd alant . ... .. .. .. . ___ . . . . . . . . . . . , . . . . . . 18,022,914 17,878,551 Get, . ......m - - . . . . .m .m.................. 5.703.8912 5.029.681 83,088.711 81,347,326 14e t accumu , . iation and amortization .. -, .. . - . . . ... . . . . (29,8CQ729) {22.291.233) 54.187,932 53,955,593
- u" gress_ . . . , , . . . __...m.= ... .. 7.476.459 2 507.473
- cumulated depreciation
- ........m-............. . .. .m _61,658 301 56. % 3.056 Resth Debt.. __.......-.. . . . . . . .. . ........m-................. 6,973,725 6,793,117
- Renewal and Replacement funds ..... = . . . . ..-.....m..............m... . . . . 3,958,168 3,922,752 1990 Certificates Construction fund ... .m-- . . . . . . . , 6,876.848 11,804.801 Customer's deposits . .. .. . . = _ . .. . . . . . . . . . . . . 97't,181 952.693
- CR.3 Decomnussioning fund .. . .....m.........m . . , . . . ~ . , , 602.467 480,849 Rate Stabilization fund . . . . . .m........... . .. . . 45.611 67.sni Total restricted assets . ..... ..... __m. ,, _. 10.373.000 24.021.717 Current assets Cash and cash equivalents ..... ... .. ..... . .. ... .... - . 626.784 344.113 Accrued interest receivabic ...... . .. ..... .. . . . . . . _ . m= 77,407 65,227 Accounts receivable (net) ..... . .... . ... .: .m.. . . . . . . . . 1,198,213 1,549.934 Unbilled accounts receivable . . . . . . . 2,221,882 1,972,800 Due from other governments .. .. .- .m...................... ......m.... .. 0 1,007 inventories .... . .a.. = _:- _ _ . . . . . . . . . . - . . . . 1,615,217 1,423,786 Prepaid expenses and other assets .......: 217,991 159,007 Assessments receivable . _ : m. .. ..............m..... -.m..,..m, . . ...m...... 97.079 "'ig[Q2 Total current assets ... .. :- . 6.054.573 5.500 276 Deferred Charge. and Othu Assets Unamortized debt expense ...... . 751,243 793.544 Deferred charges and other assets . . ..........-- 15,078 18,234 Assessments recchable . noncurrent . . . . . . . . . . ~ . . . . . . - . 0 58.912 Total defened charges and other assets .m.- .. .. . . . . . . . . . . . . . . . . 766 321 870.605 Total assets - . . . . . . - . . . . . .. . - . $87,852,285 $86,945,754 The accompanying notes are an 2
Statement 1 LIABII.iTIES AND UTIIIIY EQUITY 1991 1990 Utility Equity Contributed capital: . .~. . . . . - . $20.460.199 $19141.604 Retained Earrungs:
Reserved for debt senice ...... .... . . . ... , . = 3,565,536 3,632.700 Unreserved ...- ....... .....- = == . . .. 1.181 225 3.177.332 7.149,M1 1S10.ftp Total utDity equity .. ... .., .....m . ...m- =-.... .. .. .27.609.552 .26.d5dJd6
- Long. Term Debt Nose payable (net of current portion) . .. .. .. - - . ... . . . . . . . . . 2.805.000 2.865,000 Revenue certificates payable (net of current portion) ........ . ... .... ....... . . .. 49.185c300 50,265,000 Irss: unamortized debt discounts .. -. ... .. . . .. (706/206) (846.606)
Total long term debt .... -... ..... .... .... .... . . .. . .. . . . . .. . . . . .E' E M .52.283.394 Restricted Fund Liabilitics Revenue certificates payable (cu2 Tent portion) . . . . -. . 1,625,000 1,375.000 Note payable (current portion) .. - - . . . . . . . . . . . . . . . . - . .
60.000 60,000 Accrued interest payable ... ............ . ... ..- . .. ..... .. . . . .. , 1,768,700 1,792.922 Acccunts payable ..................~.......... . . . 393,999 312,295 Customers' deposits -, -.
. . . . . . . . . . . . . . . . . . .. - - . . . . . . . 907,571 912,064 Deferred credits:
Reserve for decommissioning costs . .......... 602,467 480,849 Reserve for arbitrage rebate .. .. . . .... -. ;..... 191.244 94.223 Total restricted fund liabuities - m...... .
......,e...._ 5.548 981 5 027.353 Current LiabDities Accounts payable .. . - . . . . . . . . . . - . . ; - . . . . . . - . . ...:- . 1,641,257 1,675,863 Accrued liabuities ...... . . . . . . . . . . . . . . . . . . . . . , . 600,985 623,669 Due to other governments - .. 410.408 405.353 Total current liabnities .... . 2 852 650 2.704.8as.
' Other Noncurrent Lisbuitics.
Deferred campensated absences .;.-.... ... ....................... ,_. .. 480,794 474.456 Dafe, red credits . operating reserves ; . . . . . . . . . . . . . . . . . . . .
166 902 10'.0 Total other noncurrent liabilities . .. .... ...; . , . . . . . . . . . . . . 647.701 475.426 Tc,tal liabilities .-.. . .... ....... ._: 60.242.726 60.491.108 Total liabuities and utuity equity .- . . . . - 587,852.285 $86,945.754 integtal part of the financial statements.
3
STATEMENTS OF REVENUE, EXPENSES ANu Statcment 2 CilANGES IN RETAINED EARNINGS For the Fiscal Yearsc.nded September 30,1991 and 1990 llTIUTIES COMMISSION. CFIY OF NEW SMYRNA BdACll, FLORIDA NEW SMYRNA BEACH, FLORIDA 1991 1.990..
Operating Revenue Sales ...... . ......m._ :~..., . . . . . . . - . .. $29,815.850 $27,833.668 Other revenue ... .. .. -. . ... . . - .
297.4QS 278,545 Total operating revenue ... .. ... .- .. . .. .2!L113.259 .28.U 2.212 Operating Expenses Production expenses . . . . . . . . . . . . . . . . . . .. . ___..... 15,718,072 - 14.971,670 Transmission, distribution and sewage collection and treatment .. ..... ... .... = . . .m......m...-. ...., .. 2,999,865 2,856,957 Customer accounting : . . . . . . . . . . . . . - = . . . . .. 753.860 721.935 Administrative and general .. . ... _ _ _ ,. .._ 3,856,593 3,541,852 Required payments to the City of New Smyma Beach .. ... . . . . 1,785,889 1,781,241 State utilities tax , ... . . . . . . , . . . . . . . . . . . . . . . .. . 0 321.159 Depreciation and decommissioning : . . , . . . . . . . . . .. .. . 2 616.987 . 2.447.Jf5 Total operating expenses ..... 27.721 286 26.642.379 Operating income ... . . . . . . . . .. 2 391.972 Jalfa9.834 Nonoperating Revenue J Interest earnings . . ............ .~=.-. .. .. 696.413 801.086 Other income ...... . ... .. . -- . . 178,878 189,772 Gain on disposal of assets .. ..... . - . . . . . ........~x . . . . . 1.02 2 0
- Total nonoperating revenue : . . . . . . . . . 876.320 990.833 Totalinecme ..-- . . 3.268,222 2 460.692 Nonoperating Expenses
- Interest and debt expense . . .. ... ~. . 2,840,798 2,731,553 enses ..~ .. . .. 5.238 108,507 Other Loss on exp'sposal of assets .
c .. .. 82.937 134 066 Total nonoperating expenses .. .. .. ., ... . _.2.928.973 3 024.1?fi Net income (loss) ..... ., ... .~ . --- . . ~ . . . . . 339,319 (563,434)
Retained earnings, beginning of year .. . . . . . ., _f 810.042 7.373.476 hetainii earnings, end of year. .. . . . - _. . m- . . . . $ 7,149,361 $ 6,810,042 The accompanying notes are an integral part of the financial statements.
4 1
STATEMENTS OF CASil FLOWS Staternent 3
' For the Fiscal Years Ended September 30,1991 and 1990 UT1LITIES COMMISSION, CITY OF NEW SMYRNA BEACH, FLORIDA
~ NEW SMYRNA BEACH, FLORIDA -
1991 1990 cash Flows From Operating Activities Cash received from custemers . . .... $30,373,425 $27,764,482 Cash paid to suppliers . - .........: ................. . . . . . . . . . (19,569,407) (19,091,380)
- Cash paid to emploges .... ...... .. .. ... . .. .. ... ..... .... .. .. . . . . . . .. .. (5.330.617) .L4.208.802)
Net cash provided by operating activities . ......~... ......~ - s.473.401 E.L3.QQ Cash Flows From Noncapital Financing Activities Cash received frcm nonoperating sources .. = . . . . . . ....m .. 178,878 189,771 Cash paid for nonoperating expenses . . . . ~ . . . . . . . . . ~ . . . . . . . . . m.. .. (5.233) f109 s02)
- Net cash provided by noncapital financing acthities _
.. . . . . .. . . . . 173.640 8 1.2 (14 Cash Flows From Capital and Related Financing ActMties Net proceeds from issuance oflong term debt . m..... . . -. 0 15,749,090 Debt reduction outlays -~. . .. . (890,000) (850,000)'
Contributed capital . ...., . . . - z........ . ~.. 815,594 1,104.404 Proceeds from sale of property and equipment ... . . . .... .. ... 5,750 363 Acquis' tion and construction of capital assets , . ..... .,. ... ..... . ...... . (7,952,956) (4,686,529)
Interest paid (net of arnount capitalized) .. ...... ...m_ (2.772 710) (2.187.040)
Net cash provided by (used in) capital and related financing aethities ; fl0.7 E 341) 9 100 28S Cash Flows From Investing Activities purchase of Investment securities .~.... .. - . (4,017,835) (6.016.589)
Proceeds from sale and maturities of investment securities . ... . . - . . . . . . .. 7,673,775 4,325,177 Interest received (net of amount capitalized) - . .. .~...... ..~ 784253 791279 Net cash provided by (used in) investing activities _... ...m.. -.....- 4.437,194 f 899132)
Pet increase (decrease) in cash and cash equivalents : . . (710,106) 12,046,719 Cash and cash equivalents, beginning of year . . ... .... . 19.39ao.2Q 7.349.371 Cash and cash equivalents, end of year ... . .. ... .o .. ...... ........ .. ... . _ . . . , $16,685,984 $19,396,090 Reconciliation of Operating Income to Net Cash Provided by Operating Activities
. Operating income (loss) ... .,... .. - - - - - . . $ 2.391,972 $ 1,469,831 Adjustments to reconcile net income (loss) to net cash provided by operating actMties:
Depreciation, amortization and decommissioning . .m...... .. .. . 2.791.601 2.559.841 Provision for losses on receivables = . . ... 59,000 61,237 Decrease (increase) in operating assets:
Accounts receivable ...... . . . . . . , .. __m 44,646 (510,181)
Assessments receivable . ........ -
z ..mu 36.240 (10,947)
Inventories . . . . z.. (191,431) 43.677 Prepaid expenses . -- . . . . . . ... (58,984) (37,118)
Deferred charges and other assets .... . .. 3,156 62.084 increase (decrease) in operating liabilities; Accounts payuble . . z ... 47,098 (152,952) g' Due to other governments .. . . . . . . . .. 5,055 173,398
- Customer deposits . . .. .. .. . . . . . . . ,. (4,493) 62,100 Otherliabilities __.. .. . 349.541 43.322
- Net cash prov:ded by operating aethities . .. S 5,473,401 $ 3,764,300 The accompanying notes are an integml part of the financial statements.
5
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NOTES TO 17NANC/AL STATEMENTS i
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l NOTES TO TIIE FINANCIAL STATEMENTS !
September 301991 end 1990 l UTtlE COMMISSION, CTIY OF NEW SMYRNA BEACli, FLORIDA
Notc 1t Cerceral Bashof Amntize Summary 'Ite accounting policies of the Utilities Commis- Basis of accounting refers to when revenues and of sion, City of New Smyrna Beach, (the 'Commis- expenses are recognized in the accounts and re.
Significant sion*) comorm to the generally accepted account- ported in the financial statements, it relates to
- Accounting ing principles as promulpated by the Amerienn the timbg of the measurements made, regardless 1 Policies Institute of Certified Pub,ic Accountants, the of the measurement focus applied. The Utilities Financial Accounting Standards Board, the Commission utilizes the accrual basis of account-Governmental Accounting Standards Board, and ing. By utilir.ing this method, revenues are re-the Federal Energy Regulatory Commission- cognized when they are earned, and expenses The following is a summary of the significant are recognized as they are incurred. Unbilled policies: utility service receivables are recorded so as to provide a better matching of service revenues RepericEnthy and the costs of providing the service.
The Utilities Commission, was created in 1967 through the passage of Chapter 67-17S4, Laws Bud,cet and Bdgemn Axouandy of Florida, Special Acts of 1967 (House Bill 1669) An annual budget was adopted for the electric, which amended the Chaner of the City of New water and pollution control utility systems. The Smpna Beach, Florida, to create the Utilities budget was adopted on a basis consistent with Commission. In a referendum held October 2, generally accepted accounting principles (GAAP) 1984, the voters of the City of New Smyrna except that certain other cash receipts and pay-Beach, Florida, approved amendments to the City ments are treated as budgetary items to maintain Charter to limit the terms of office of the Utilities effective fiscal and budgetary control over the Commissioner's, require City Commission appro- collection and disposition of all commission re-val for extensions of utility senices outside the sources. Specific budgetary control is exercised city limits, give the City Commission the right to over internal operating transfers to restricted review and approve the Utilities Commission funds, payments of pancipal on long term debt budget, and require City Commission approval obligations, and collections of contributed capital before issuing or refunding revenue certificates which are recognized in the budget as additions and entering into contracts exceeding four years. and/or deductions to reconcile budgeted net cash receipts to reported net income (loss) for These elements of oversight require that the each system. Budget appropriations are pre, funds and entities related to the operation of the pared by the administrative staff and approved Utilities Commission be included as a component as provided by law by the Utilities Commission.
tmit of the City of New Smyrna Beach, Florida, Budgetary control is exercised at the departmen-and an integral part of the City's reporting entity, tal level. Budget amendments, if any, can be re-The basic financial statements are incorporated in quested by the Director of Utilities. However, all the City's Comprehensive Annual Financial Re- budget amendments must be approved by the port as an enterprise fund activity. Utilities Commission. Unexpended appropriations for operations lapse at year end. No supple.
In 1983, the Utilities Commission entered into a mental appropriations were required for the cur-participation agreement with Florida Municipal rent year.
Power Agency (FMPA) for an entitlement share of
-betric capacity and electric energy from FMPA's Cash and Cas3 EquAnAvns
, uded ownership interest in Florida Power The "tilities Commission invests all cash balan-a e t Company's St. Lucie Unit No. 2, a nu- ces in interest bearing accounts. Earnings from cles. g.nerating unit. The Utilities Commission's these investments are appropriately allocated to role in the agreement is limited to that of a par- the investing fund accounts based upon the in-ticipant contractually obligated to parchase elec. vestment equity and are used, where applicable.
tric capacity and electric energy. The agreement to finance general utili:ies commission operations.
between the Utilities Commission and FMPA does I
not meet the criteria for inclusion within the re- For purposes of the statement of cash flows, the porting entity of the Utilities Commission. The Commission considers all highly liquid debt in-agreement specifically provides that the ar. struments purchased with original maturity t rangement is not a joint venture and neither dates of three months or less to be cash equival.
FMPA nor the other utilities which entered into ents.
) participation agreements with F.MPA for entitle.
ment shares from FMPA's undivided ownership /nresonents interest in St. Lucie Unit No. 2 are accounting for Investments are recorded at cost or amortized the agreement as a joint venture. Accordingly, cost, which approximates market. Adjustments the Utilities Commission is not accounting for the are made to cost, for any prerdum or discount, agrecuent as a joint venture. which is amortized over the maturity of the in-vestment.
6
NOTES TO Tile FINANCIAL STATEMENTS l - September 30,1991 and 1990 i UTILITIES COMMISSION. CITY Oi' NEW SMYRNA BEACll. FLOPdDA NFW SMYRNA BEACH. FLORIDA Note 1: Exe/mNes period interest is capitalized net of interest Summary Accounts receivable have been reported net of an earned on tmexpended construction funds in of allowence for uncollectible accounts which has accordance with the applicable prosisions of Fin.
Significant been provided based upon management's analy- ancial Accounting Standard Number 62 and, Accounting Sis oflu'storical trends. Utility operating revenues therefore depreciated over the remaining useful Policies are recognized on the basis of cycle billings ren- life of the related asset.
(Contin.ted) dered monthly. Unbilled accounts receivable are accrued at September 30th, to r.: cognize the Depreciation is provided for by utilization of the sales revenue ea ned between the last meter straight line method (half year convention in reading date made through the end of the fiscal year of acquisition) calculated on a service life ba, year, sis to amortize the cost of the assets over their economic estimated useful lives which are as
/mento&s follows:
Inventories are priced at ecst by the use of the
'first in, first out' method of accounting. The ef- Yem feet of this method is to recognize the costs of the Electric System: ,
materials and supplies in the order in which they Production plant:
were purchased and to assign a balance sheet Nuclear production - . . . . . ... 27 inventory valuation more nearly at current re- Diesel production . . ... . 20 40 placement value. Electric line transformers, elec- Transmission plant . .. 30 tric meters, water meters and replacement units Distribution plant : 28-45 for the generating plants are classified as utility General plant:
plant in accordance with accepted industry prac- Structures and improvements , ,, 40 tices set forth by the National Association of Other general plant ., ...-.. , S.20 Regulatory Utilities Commissioners. Water System:
Source of se yly plant ..-.. . 25 50 thacrth&Mr Dnwunt andlxwe Casa Pumping plans . . ....... ;- 35 Bond discount and issuance costs are deferred Water trmm nt plant . _ - 40 50 and amortized over the term of the respective Transnu son and distribution plant . 25 50 debt issue using the bond outstanding method General plant:
which approximates the interest method Un- Structures and improvements .. . . 35 amortized bond discounts are presented in ag- Other general plant . . .. . ... . . 10 35 gregate in the financial statements as a reduction Pollution Control System:
of the carrying cost of the related long-term debt. Collectionplant. 4 . .. 35-50 Unamortized debt issuance costs are presented Pumping plant: )
es other assets. Structures and improvements .-.. . 50 4 Pumping equipment ---- . . 4 25 i Besnitd Aces Treatment and disposal plant . . ... 25,40- i Proceeds from debt. funds required to be set General plant - . . 10 50 '
aside for the payment of revenue bond debt Common Plant:
service and contingencies, and other specific as- Structures and impmvements .. .. 35 sets set aside for restricted purposes which Other general plant .. 5 15 cannot be used for routine operations are clas-sified as restricted assets since their exclusive Compensard Ahmms use is limited by applicable bond covenants and The portion of employee payroll costs paid sub-other legal indentures, sequent te year-end attributable to services per.
formed prior to yeavend is recorded and recog-ud/yphnt nized as a current liability. Employees earn on-Utility plant !s stated at historical or estimated nual vacation leave at the rate of 80 hours9.259259e-4 days <br />0.0222 hours <br />1.322751e-4 weeks <br />3.044e-5 months <br /> per historical cost. The costs of additions replace- year Or one through five years of service and 80 ments, and renewals of units of property are ad. hours phis eight hours for each two years ded to utility plant. The cost (estimated, if not service over the first five years to a maximum of known)of units of property retired,less net 160 hours0.00185 days <br />0.0444 hours <br />2.645503e-4 weeks <br />6.088e-5 months <br /> per year. All outstanding vacation salvage, is charged to accumulated depreciation leave is payable upon termination.
and the appropriate asset account. Donated util.
ity plant is stated at its estimated fair market Employees accumulate ten hours (eight hours value on the date donated. prior to July 1,1986) of sick leave credit for each i
month on regular pay status. Employees make l Maintenance and repairs of property and re- an irrevocable election regarding the accumula-placements and renewals of items determined to tion of credits and the amounts of credits which be less than units of property, are charged to can be recewed upon termi:ution. One option operating expense as incurred. Construction provides for the payment of all unused sick leave -
-7
I , - - - _ s I
i NOTES TO Tilh FINANCIAL STATEMENTS September 30,1991 and 1990 UTILITIES COMMISSION, CrlY OF NEW SMYRNA BEACH, FLORIDA NEW SMYRNA BEAQ1, FLORIDA Note 1: ..t 75% of the existing pay r te at tertaination. any source ieceived are recorded in an appropri-Summary The second option requi % the ' banking
- of at ately captioned cont;ibuted capital : count.
of least 240 accu.nulated hours. Mcurs accumu-Significant lated in excess c'f 240 hours0.00278 days <br />0.0667 hours <br />3.968254e-4 weeks <br />9.132e-5 months <br /> m!! be paia annually Reseems Accounting at 75% of the prewding July 1st pay rate. Funded reserves are used to record a portion of Policies retained entnings which mut be segregated for (Continued) &fenn/ Cm/h and Operady Besem=s some futun: use and which are, therefore, not The reserve for nuclear re-fueling and main. available for further appropriation or expenditure.
tenance outoge is an opemting reserve estab-lished to account for the estimated charges to be Bares, Bemnues, and Ae/ Espenses incurred for the removal and installation of nu. Revenues are recognized based on monthly evele clear fuel assemblies. Chargas are made against billings to customers. The rate schedules are ap-the reserw at the time the actual re fueling proved by the Utilities Commission. The electric takes place. The reserve for nuclear plant de- rate schedule contains an energy ccet adjustment commissioning costs was established to uccount clause whleh reflects the cost of fuel as well as for the estirr.nted crsts of r.uclear plant decom the energy and fuel components of purchased mioloning. Charges against the reserve will be power. Generally, the effect of the increases made at the actual time of decommissioning. and/or decreases in the cost of energy is recov-cred over a four month period and is determined The reserve for arbitrage rebate is a reserve as the difference between actual applicable fuel established to account for the estimated amount costs end the costs actually billed during the of excess intuest earnings from the investment of same period.
the 1990 Series Revenue Certificates proceeds which will be rebated to the Intemal Revenue The cost of nuclear fuel is amortized to fuel ex- '
Servtce after 1994 purt:uant to federal tax leginla- pense based on the quantity of heat produced tion, for generation of electric energy in relation to the quantity of heat expected to be produced over Comibuta/ Capha/ the life of the nuclear fuel este.
Contributions of capital to a proprietary fand from Note 2: Pursuar t to the applicable provisions of Chapter Bepos/ts Cash 280, Florida Statutes, 17te Ehni/a SeunW/br The Commission maintains several multi-purpose Deposits pub /hDejushsAet("the Act'), the State of Flor- cash accounts which are aggregated and swept _
and ida, Department of Insurance, Bureau cf Collat- nightly for investment in accordance with the Investments eral Secunties, and the Departmcnt of Treasury provisions of a negotiated three-year overnight have established specific requirements relative recurchase agreement. As a part of this agree-to the security and collateralization for public ment the Commission is required to maintain a deposits. Accordingly, banks qualifying as a pub- single non-interest bearing compensating balance lic depository ir' 'he State of Florida must adopt account in the amount of $208,000.
the necessary procedures outlined in these stat-utes and meet all of the reqvirements of this At September 30,1991, the carrying amount of chapter to be designated by the State Treasurer the Commission's deposits was $12,947,121. Of as eligible to receive deposits from municipal de- this amount, $100,000 was insured by faleral positors, Collateral having a market value equal depository insurance and $12,847,121 was se-to 50% of the average daily balance for each cured in accordance with the statutory provi-month of all public deposits in excess of any ap- sions of the Act. Included in the entrying amount plicable depository insurance is required to be of Commission deposits is $4,450 in petty cash pledged or deposited with the State Treasurer to and ~nge funds, secure such deposits. Additional collateral, up to a maximum of 125%, may be required if deemed /nmstments necessary under the conditions set forth in the *Ihe Commission's investment policies are gov-Act. Securitics eligible to be pledged as collat- erned by state statutes and local resolution. At eral are generally limited tc obligations of the September 30,1991, the Commission's investment Uruted States government and any state thereof in allowable investment instruments included:
and are held in the name of the State Treasurer's bonds, notes, certificates of indabtednes:;, and office. Compliance with the provisions of Chapter other securities which are guaranteed by the full 280, F. S., is monitored by the Department of in- faith and credit of the United States of America.
surance.
8
NOTES TO Tile FINANCIAL STATEMENTS September 30,1991 and 1990
- URLIVES COMMISSION, CITY OF NEW SMYRNA BEACH, FLORIDA
' NEW SMYRNA BEACH, FLORIDA Note 2: The Commission's investments are entegorized to are held by the banks' trust departments or j Cash give an indication of the level of risk assumed by agents in the Commission's name. Catet,ory 3 in-Deposits the Conunission at September 30th. Category 1 cludes uninsured and unregistered investments and includes investments that are insured or regis. for which the securities are held by the banks, '
Investments tered or for which the securities are held by the or by their trust departments or agents but - not in Commission or its agent in the Commission's the Commission's name. There were no category name. Category 2 includes uninsured and un. 2 and 3 investments at September 30,1991, registered investments for which the securities
'Ihe Commission's investments are categorized as follows:
Category Carrying Market Type of Investment 1 Wlue Wlue Fidelity Treasury Portfolio II Fund . . __ _ ... - $ 5.659,925 $ 5,659,925 $ 5,659.925 U.S. Treasury State and Local Government Series (SLGS):
Ne tes ...... . . .. -
. 740,200 740.200 740,200 Bonds _ . 573 600 573.6D0 _ 573.600 Totals . . . . . . . . . . . . . . . . . . $ 6,973,725 $ 6,973,725 $ 6,973,725 Cash and cash equivalents consist of the following at September 30:
1 September 30, 4 1901 1990 Operating cash ... . . . . ,
$J26.784 $ S44.111 Restricted assets:
Debt service funds ... ..... ...,- -- . . ... . 5,659,925 2,273,377 Renewal and replacement funds . . .. .. 3,951,168 3,922,752 1990 Certificates construction fund .. .. . . . . - - . . . . . 6.876,848 11,804,801 Customer deposits . . - -
. . . . . . . _ . . . . . . . 923,181 952.693 CR 3 Decommissioning fund . 602,467 30,849-Rate staoilization fund . . .
45.6n 67.505 18.059.200 lo.051.977 -
Total cash and cash equivalents . . - - . . . . . $18,685.984 $19,396,090 Note 3: A sumnury of net accounts rece.ivable is as follows:
Accounts Receivable j-September 30, 1991 1990 Billed customer accounts receivable . .......-....... $ 1,252.971 $ 1.608,113 Less: allowance for doubtful accounts ..- ..
(54.758) (58.1791 Totals .. $ 1,198,213 $ 1,549,934 t
I 1
l 9
l.
T NOTES TO TIIE FINANCIAL STATEMENTS <
. September 30,1991 and 1990 U'111111ES COMMISSION, CrfY OF NEW Shn'RNA BEACH, FLORIDA
- NEW Shn'RNA BEACH, FLORIDA Ncre 4:. A summary of restricted assets is as follows:
Restricted -
Assets _ September 39 1221 _
Time Accrued September 30, Deposita/ Interest 1990 cash Inve-:tet _Receivab!e. ._ Total Total .
Debe Service Funds:
1979SinkingFund . . . . .. ... $ 1,042,886 $
0$ 0 $ 1,042.886 $ 1,044,293 1978 Reserve Fund .. _- -1,473,795 573,600 0 2,047,395 2,047,394.
1986 Sinking Fund .. . . . . - . 324,583 -0 0 324.583 317,148 1986 Reserve Fund .. ..... .. .... 547,430 0 0 547,430 547,430 1987 SirAing Fund ...... ; ...... 368,713 0 0 368,713 368, % 3 1987 Reserve Fund .......... 0 740,200 0 740,200 740,200 1990 Sinking Fund : 687,519 0 0 687,519 522,519 1990 Reserve Fund 1.214.999 _Q p . L2.14,222 1 205.170 5 659.925 1.313.E0Q 0 6.973.725 6.793.117 Renewal and Replacement Funds:
Res. No. 28 78 . 931,447 0 5,576 937,023 961,509 Water and Pollution Control Connection Fee Fund . . . . . _ . . . . . . 10.1LIAS 0 . . O _10.14.1A5 2.961.242 3.945.592 _D 5.576 3.951.163 3.922_752 1990 Certificates Construction Fund 6 B65 516 0 11.332 6 876 848 lL804.801 Cuxomer deposits ... .. ...., .. 92L393 0 783 923.1 g1 952 422 CR 3 decommissioning Fund .. .... 601.9E2 0 485 602.ds2 _ ASD.B42 Rate Stabilization Fund - 45.545 0 E 45.611 67.505 Totals . . $16,040,953 $ 1,313,800 $ 18,247 $19,373,000 $24,021,717 Note 5: A summary of utillry plant is as follows:
Utility .
Plant-. (000's omitted)
Pollution September 30, Electric Water . Control Common _1921_, 1990. -
Land and land rights -- . $ 1,228 $ 98 $ 220 $ 7 $ 1,553 $ 1,552 Structures and improvements . 2,593 2,672 3,853 989 10,107 9,925 Production plant, nuclear fuel and treatment plant ....... ... .. 10,056 4,125 4,240 0 18,421 18,317 Transmission, di:tribution and collection plant . ..... = ... 29,812 9,270 9,710 0 48,792 47,026 Other general plant and equipment . . 401 0 0 ._4.708 5.116 _ A.528 44,097 16,165 18,023 5,704 83,989 81,348 Accumulated depreciation . .... (16.972) . (4.680) .15.58Z) _f 2.5551 129,801) (27.3921 27.118 11,485 12,436 3,149 54,188 53,956 Construction in progress . . .. .. . ... . . 1.178 4.620 . 274 1.398 7,470 1 592 -
Utility plant, (net)_ _ . $28,296 $16,105 $12,710 $ 4,547 $61,658 $56,463 Capitalized interest on outstanding tax. exempt securities charged (credited) to projects during the construction period was $408,398 and $160,777, for 1991 and 1990 respectively (net of interest earned on unexpended long term debt proceeds totaling $636,640 and $671,837, respectively). <
10
l ..
I
- NOTRS TO Tile FINANCIAL STATEMENTS
' September 30,1991 'and 1990 UTILITIES COMMISSION, C'TY OF NEW SMYRNA BEACll, FLORID A NEW SMYRNA BEACH, FLORIDA Note 6: A summary of long-term debt outstanding is as folhvs:
Long. Term Debt September 30, 1911 _ . 1000 Revenue Cernficates:
Utilities System Revenue Refundi : and Improvement Certificates, Series 1978-6.30% to 7.125% due serially to 1993, with
$9,075,000 and $ 11.335.000 term certificates due in 2003 and 2010, respectively .-_ _ _ _ _ . . .
. _ . . . . .. $21,870,000 $22,395,000 Utilities System Revenue Improvement Certificates, Series 1986-5.60 %
to 7.25% due serbily to 2001, with S4,670,000 term bonds due in .
~
2015 m _. . . . . . . . . . . 6,220,000 6,315,000 Utilities System Refunding Revenue Certificates, Series 1987- 5.20% to 7.10% due serially to 2001, with $2,790.000 and $2,080,000 term Sonds due in 2007 and 2011, respectively ... . -.. . .
. . 7,720,000 7,930,000 Utilities System Revenue Certificates, Series 1990-.5,90% to 6.80%
due serially to 2001, with $1,465,000, $1,930,000 and $9,075,000 term bonds due in 2005,2009, and 2019, respectively - _15.009A.QD _15.000.000 50.810.000 51,640,000 Less: unamortized debt discount , . . . . = .
(785 522) J14.545)
Total revenue certificates outstanding, net of unamortized discount . 10324,478 50.80311M Note Payabb:
Note payable-Florida Municipal Power Agency, as agent for 'lhe Initial Pooled Loan Project-$3,000,000 mannum principal amount with variable interest rate (currently 6.05%) principal due in installments to 2013... . . . _ _ _ _ _ . _ __ 2,865,000 2,925,000 Less: unamortized debt discour.t . fil.0M) (11.910)
Total note payable, net of unamortized discount . . . . . 2AS3.215 __2.91d&fd Total outstanding long-term debt . .- . .52.878 194 53.718.394 Current Maturities:
Series 1978 Certificates . ...~... . . . . . . . . . . 850,000 800,000 Series 1986 Certificates 215,000 200,000 Series 1987 Cernficates . -.
. 220.000 210,000 Series 1990 Certificates .. m.-. . 340,000 165,000 Note Payable - FMPA - . ;... , 60.000 60.000 Total current maturities .
1.685.00Q 1. A 3 5.009 Total long term debt. net of unamortized discount . . $51,193,394 $52,283,394 The authorization for the outstanding 1978 Certi- obligated to levy any taxes for the payment ficates and all subsequent issues (collectively re- thereof.
ferred to as the " Certificates") provides that the Commission will not issue additional obligations Under the terms of its long term debt agree-except for the construction and acquisition of nents, the Utilities Conunission has agreed to additions, extensions and improvements to the maintain certain restricted fundt. (see Note 4) system or for refunding purposes and exceot and to comply with the covene .a contained in upon the parity condin a provided in th- su- such agreements. Certain of these agreements thorizing resolution. contain the following provision relating to the The Certificates are payable from and secured by a first lien upon and pledge of the net revenues 'Any holder of certificates or coupons sp.
derived from tne operation of the sprem. These pertaining thereto issued under the provi-Certificates do not constitute general indebt- sion hereof er any trustee acting for the edness of the Commission or of the City of New holders of such certificates may by suit, ac.
Smyrna Beach, Florida (City) and the City is not tion, mandamus or other proceedings in any 11
- . . _ ~_ _ ___ -__ . _
4
- NOTES TO TIIE FINANCIAL. STATEMENTS September 30,1991 and 1990 U111JITES COMMISSION, CITY OF NEW SMYRNA BEACH, FLORIDA
- NEW SMYRNA BEACH, FLORIDA 1 Note 6: coun of competent jurisdiction, protect and Utilities Commi sion, if any, in administering the Long Term ' enforce any and au rights, including the subject Loan.
Debt rignt to the appointment of a receiver, exist-
. (Continued) lag under the laws of the State of Florida, The aggregate annual debt service requirements or granted and contained herein, and may for the certificates and variable interest rate note enfom and compel the performance of all payable in each of the next thc years are as du r: herein required or by any applicable follows:
statutes to be performed by the Commission or by any officer thereof. Fiscal Revenue Note Combined hat Cenificates hu'able To.tal Nothing herein, however, shall be con-stmed to grant to any holder of the certifi- 1992. .... $ 4,569,666 $ 239,172 $ 4,808,838 cates any lien on any real property of the 1993.. ... $ 4,563,791 $ 239,926 $ 4,803,717 Commission or the City.' 1994. . $ 4,566,896 $ 240,873 $ 4,807,769 1995., . $ 4,566,426 $ 241,507 $ 4,807,933 The applicable rate of interest on the note pay- 1996. ..., $ 4,564,506 $ 242,287 $ 4,806,793 able to the Florida Municipal Power Agency (FMPA), as agent for the initial Pooled Loan Pro- As a part of its outstanding revenue certificate ject is subject to change with ten days notice obligations, the Utilities Commission is subject to
- from FMPA. The Loan Agreement also provides certain covenants and provisions which require that FMPA may increase the effective rate of in- specific actions to be taken by the Commission
. terest to recover the cost of interest becoming during the year. The Commission has complied due on the FMPA obligations allocable to the loan with all significant contractual covenants and and to recover certain other expenses from the provisions.
Note 7: In prior years, the Co.nmission defessed certain September 3 Prior outstanding utilities revenue certificates of the 1291 _.12N _.
Years' Commission and certain general obligation bonds Defcasance . of the City of New Smyrna Beach issued for the Series T.1963--4.0%
of System payable out of revenues derived from the due 2003 -..-. .. 673,000 713,000 Long Term operation of the utilities system by placing the Series B-1965--3.7% to Debt proceeds of new certificates in irrevocable trusts 4.1% due serially to to provide for all future debt service payments on 2003.. . . . . S 390,000 $ 415,000 the old certificates / bonds. Accordingly, the trust Utihties:
account assets and the liability for the defeased Series 1975-3.75% to bonds are not included in the Commission's fin- 6.2% due serially to ancial statements- 2004 . _ 2,030,000 2,110,000 Series 1975A 5.0% to At September 30, the following certificates / bonds 6.6% due serially to are considered defeased: 2005 .. ._, . . ...... .... . 2,780,000 2,900,000 Water and Sewer Revenue
, September 30, General Obligation Bonds:
1991 1990 Series 1976--4.5% to 1978 Refunding: 6.2% due serially to Waterworks and Electric: 2001.... 4,060,000 4,340,000 Series 1955--3.75% due serially to 1993...... . $ 295,000 $ 436,000 1985 Refunding:
Series 1962 afunding-- Series 1982 -12.625 %
3.5% due in 1999. 35,000 35,000 due serially from 2012 Series 1962--3.9% to to 2016. 4 . . . . . . . ... 6,190,000 6,190,000 4.2% due serially tc 2000.m.- -. . . . . -- 1,545,000 1,595,000 1987 Refunding:
Series 1965 4.2% and Series 1985- 5.75% to 4.25% due serially to 9.50% due serially to 1,800,000 1,830,000
~
2004-- 1999 with $2,135,000 Sewer: and $3,130,000 term Series S 1963--3.9% certificates due in 2005 dee serially to 2002 - 255,000 280,000 and 2011, respectively 6,330,000 6,965,000 12
M NOTES TO THE FINANC)AL STATEMENTS September 30,1991 and 1990 IJ111JTIES COMMISSION, CITY OF NEW SMYRNA BEACH. FLORIDA NEW SMYRNA BEACH, F1.ORIDA Note at Tne legislation that created the Utilities Commis- quasi-external transaction for financial reporting _
Required sion regtdres it to pay to the general fund of the purposes. The amount paid to the City totaled
_ payment City of New Smyrna Beach a sum equal to six $1,785,889 and $1.781,241 for the years ended to percent (6%) of'the gross revenues from utilities September 30,1991 and 1990, terpectively. He City under Commission control. This payment is sub. balance due to the City at September 30,1991 ordinate to the debt service reqturement of all and 1990, totaled $345,967 and $335,307, re, utilities revenue certificates and is recorded as a spectively.
Note 9: The Commission contributes to the Florida Re. through September 30,1091, Employee tirement System of the State of Florida, a cost.
pension sharir.g multiple employer public employee re- 1he ' pension benefit obligation
- is a stand.
plan tirement system that acts as a common invest- ardized disclosure measure of the present value ment and administrative agent for participating of pension benefits, adjutted for the effects of municipalities in the State of Florida. ne payroll projected salary increases and step-rate benefits, for employees covered by the System for the year estimated to be pavGe in the future as a result ended Septen.ber 30,1991, was $5.233,844. To- of employee sendze to date. The measure, tal payroll for the year was $5,330,617. which is the actaarial present value of credited projected benehts, is intended to help users as.
All full time employees are eligible to participate sess the plan's .unding status on a going-concern in the plan. All participating employees, upon basis, assess progress made in accumulating attaining their normal retirement age (age 62), sufficient assets to pay benefits when due, and with 10 years of credited service are entitled to a make comparisons among public employee re.
retirement benefit papble monthly for !ife of at tirement systems and employers. The plan does least 1.6%, but not more than 1.68% of their not make separate measurements of assets and average fhul compensation for each year of cred. pension benefit obligation for individual employ, ited service. The awrage final compensation is ers. The estimated pension benefit obligation at the average annual compensation of the S high. July 1,1989, was computed based upon assump, est years of compensation during creditable ser. tions determined through an actuarial valuation vice prior to retirement. Benefits fully vest on performed as of July 1,1989. SipJicant actuarial reaching 10 years of creditable service. ne plan assumptions used in the valuation include (a) a also provides for death and disability benefits. rate of return on the investment of present and future assets of 8.0%, (b) projected annual salary The funding methods and determination of bene.
~
scale increases of 7.S%, (c) projected annual fits payable are provided in the various act: of payroll growth of 7.0%, and (d) no post.
the Florida 1.egislature, which created the fund, retirencnt benefit increases, including subsequent amendments thereto. In previous years, these acts provided, in general, The total unfunded pension benefit obligation that funds were to be accumulated from employ. (estimated) applicable to the Commission's em.
ee contributions, employer centributions, State ployees is not separately determined by the ac.
appropriations and income fr m investments of tuary. The estimated pension benefit obligation accumulated funds. The act also provides that, was $31.0 billion for the plan as a whole The should the accumul+d funds in the fund at plan's net assets available for benefits on that any time be insufficient to meet and pay the ben- date (valued at market) were $20.0 billion, leav.
efits duc, the employer shall supplement the ing an unfunded pension benefit obligation of .
funds by an appropriation from current funds, or $11.0 billion. The representative amount of the from any revenues which may lawfully be used Commission's contribution to the plan was not for said purposes, in an amount sufficient to make provided by the plan administrator, however, it is up the deficiency. not significant in relation to the total contribu-tions required of a!! participating entities.
The Commission's contribution to the plan during the year ended September 30,1991, totaled Ten year historical trend information showing the
$809,429 which was 15.14% of the qualifying plan's progrcss in accumulating sufficient assets employees' gross wages for the period from to pay benefits when due is obtainable from the October 1,1990 through December 31,1990, at'd State of Florida, Department of Administration, 16.20% for the period from January 1,1991 Division of Retirement.
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. . -. . ,_ < - ~ ~
c NOTES TO TiiE FINANCIAL 4 STATEMENTS-September 30,1991 and 1990 ITTILITIES COMMISSION, CITY OF NEW SMYRNA BEACll, FLORIDA NEW SMYRNA BEACH, FLORIDA
- Note 10: The Commission provides electric, water and pollution control services to the public. A summary of the
~ Segment segment information for the electric, water, and pollution control systems is as follws:
Information Pollution Electric Water Control
._ System._ _ System . civstem Total Operating revenue... .. . $24.261,715 $ 3,414,240 $ 2,437,303 $30,113,258 Depreciation and decommissioning . 1,573,671 457,665 585,651 2,616,987 Operating income (loss) ... -. . _ . _ . . _ . .. 2,116,404 560,117 (286,549) 2,391,972 Required payments to City of New Smyma Beach-_ _. .. 1,4 0,022 201,595 144,272 L785,889 Net income (loss) . . 772,158 119,221 (552,060) 339,319 Contributionin aid of construction 418,729 7,119,945 12,921,524 20,460,196 Utility plant acquisitions . .- 2,326,451 360,470 303,059 2,989,980
- Utility plant retirements - . . . . . . . . . . 273,489- 17,540 57,365 348,594 Revenue certificates payable . . 24,046,600 19,810,500 6,952,900 50,810,000 Utility equity - . .. 6,808,665 9,883,957 10,916,937 27,609,559 Total assets . .. .. . ~ 40,621,527 28,526,996 18,703,762 87,852,285 Note 11: The Commission is engaged in routine litigation mission not covered by insurance which would Legal incidental to the conduct ofits operations affairs. Inhibit the Commission's ability to perform its Matiers In the opinion of Counsel to the Commission, no operations or materially affect its financial condi-legal proceedings are pending against the Com-- tion.
~ Nota 12: ne Commission, acting through the Florida quwd to pay under its power sales contract for Commitments - Municipal Power Agency (FMPA), is a participant such month if any electric capacity and electric in a portion of Florida Power and Light Company's energy from the St. Lucie Project had beer, made (FPL) St. Lucie Unit No. 2, a nuclear generating available to them. As a result of these agree-unit. FMPA originally acquired an 8.806% un- ments, the Conunission is obligated to provide divided ownership interest of St. Lucie No. 2 to- payments of approximately $3.4 million annually.-
gether with rights to receive electric capacity and electric energy under a reliability exchange In 1988, the Commission entered into an agree-agreement. The Comnussion's participation prov- ment with FPL regarding the future short term ides for a 9.884% entitlement share of FMPA's and long term electric transmission needs of the ownership interest. A reliability excLange Commission. Pursuant to the agreement, FPL agreement provides for FMPA's exchanging 50% modified and upgraded certain existing FPL ehee-of its share of the output from St. Lucie No. 2 for tric transmission facilitics to provide electric en-a like amount from FPL's exclusively owned St. ergy to the Commission. The cost of the im-Lucie No. I to mitigate the potential for economic provements are reimbursed to FPL by the Com-loss resulting from the extende? or permanent mission, without interest, in equal monthly in-outage or early retirement of St. Lucie No. 2. sta!!ments of $8,621. As of September 30,1991, he Commission, as a participant, has also en. amounts due FPL under the at;reement totaled tered into a power sales contract which requires $68,968.
payment on a "take-an ' pay" basis for the Com-mission's entitlement snare of the project capabil- In 1989, the Commission entered into a consnuc-Ity for the St. Lucie Project for each month during tion agreement and a related fifteen year lease any portion of which electric capacity and electric agreement with Florida Power Corporation (FPC) energy are available to the Commission from the which provided for the construction and subse-St. Lucie Project, including electric capacity and quent leasing of 115 kv transmission facilities electric energy under the reliability exchange connecting FPC's respective control areas with
- agreement with FPL. In the event payment is not the Cotamission's Smyrna Substation facility. Un-required for any month under the Commission's der the agreements, the lease will become effec-power sales contract, it - 'equired to make pay- tive when construction of the transmission facil-ment for such month under its project support ities between the FPC tie point and Smyrna Sub-contract on a "take-or. pay' basis. The payment station are completed and placed in service (cut-under the preject support contract would be the rently expected to be May,1992). The agree-amount the Commission would have been re- ments also specify that the Commission has the 14
NOTES TO TIIE FINANCIAL STATEMENTS September 30,1991 and 1990 UTILITIES COMhtlSSION, CflY OF NEW SMYRNA BEACH, FLORIDA NEW SMYRNA BEACH, FLORIDA Note 12: option to purchase the transmission facilities at future costs. Funding of the resent began in
- Com mitmerits any time after the first year of the lease at a cost 198S and, based on currently revised estimates, (Continued) of $3.8 million. The lease provides for minimum the Commission is expected to fund the reserve monthly lease payments of $52,060, and includes with annual payments of approximately $85,000, a provision for insurance and real estate taxes These annual paymems, plus the interest earned levied against the facilities. As of September 30, thereon, are expected to be sufficient to meet the 1991, these have been no modifications to the Commission's portion of the estimated future de-agreement and FPC has not begun construction of commissioning costs. The provision for decom-the transndssion facilities. missioning expense recognized during the year totaled $121,618. Amounts funded by the Com.
On July 8,1991, the Commission entered into a mission at September 30,1991, totaled $602,467, construction agreement in the amount of-
$560,000 with FpC for modifications to the Smyr. At September 30,1991, the Commission had na Substation facility to accommodate the exten. additional unrecognized construction contract sion of a 115 kv transmission line to the Commis. commitments of approximately $7.3 milhun for sion's proposed Airport Substation facility. The utility plant expansion and upgrading, facilities are expected to be completed and placed in service by May 29,1992, This contrac- In 1994, the Commission may be required to re-tual commitment will be fulfilled at the same time mit an arbitrage rebate to the Internal Revenue the tie point between FPC and the Smyrna Sub- Service, pursuant to current federal tax regula.
station (outlined above) is completed. tions. As of September 30,1991, the Commission hns estimated the amount of excess interest The Commission's anticipated share of decom. earnings or invested tax-exempt debt proceeds missioning costs applicable to its participation in to be approximately $191.244. The Commission FPC Crptal River Unit No. 3, a nuclear generating has elected to fund this anticipated payment unit, is expected to be approximately 56.7 millien with an internal resene for arbitrage rebate. As at its expceted date of decon missioning in 2016. of September 30,1991, the balance of $191,244 An operating reserve has been established to was included in the restricted cash balance of provide advanced funding for these estimated the 1990 Certificate Construction Fund.
l 15-i
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1 SUPPLEMEND1L
/NFORMAT/ON Thtsecthniscomposedofthefo!/owhg:
Supplementa/Deta3Fh1ancib/Infom13thnofthe Electrh, Water;andPOUuthnControlSystems Statiktka/Secthn 171eseschedulesprovideamoredeta>7edykwofthe ComponentUnitFkiancth/
Statements'presentedhtheprecedhgsubsect,b1
. Reschtb7sNa 16-75andNa 28-78establikhedtheelectrh, water; andpolluthn contmlsystemsasashg/eenterp,7sefund ??reseschedulesarepresentedto
- provide detai7edhformathn on the bio 7vidualuti11.y systems andtopresent the budgetary companyons that are not na^essary hr a fairpresentathn El con-htmkynthgenemlyacceptedaccoun&7gpth7ciples.
-- SCHEDULE OF REVENUE, EXPEt1SES AND Schedule 1 CIIANCES IN RETAINED EARNINGS
- For the Fiscal Year Ended September 30,1991 --
W% Comparative Actual Arr.ounts for the Fiscal Year Ended September 30,1990 UTILITIES COMMISSION, CITI of NEW SMYRNA BEACH, FLORIDA NEW SMYRNA BEACH, FLORIDA pollution Totals Electric Water ,,,,,CantmL,, 1991 1990 Operating Revenue Sales . ..-.. . .. ..... . ~.. . . . . . . . . . $24,065,675 $ 3,320.850 $ 2,429.325 $29,815,850 $27,833,668 Other revenue . . .. .. - . . .
196 04Q 93.320 7.978 ?o7 40a 278.545 Total operating revenue ....m .... _ _ . . . . . . . . . . 24.r '.1 715 3 414.240 2 437.303 30.113.258 28.112 213 -
. Operating Expenses production expenses .... . . 14,938,235 779,837 0 15,718,072 14,971,670
- Transmission, distribution and sewage collection a nd trea tment . _. ..~.. .. .....,. .... .. . .... - . . . . - . . . . . . ... .. -1,462,839 378,519 1,148,527 2,989,885 2,856,957 -
Customer accounting ... ........ .. ... . . 464,453 179,183 110,224 753,860 721.935
' Administrative and general . .............. .. . . . _ .. ___ 2,264.091 857,324 735.178 3,856.593 3,541,852 Required payments to the City of New Smyrna Beach ... ...... 1,440,022 201,595 144,272 1,785,889 1,781,241 State utilities tax ..... . . ~.- .. = .. ... 0 0 0 0 321.159 Depreciation and decommissioning - . . . . . 1.573.671 _A57,665 585,651 261k2S2 2.447.565 Total operating expenses .... ... . . . . 22 143.311 T 854.123 2.723.832 .22 Z2L235 16.fd2.372.
Operating income (loss) - . 2.118,404 560.117 (286.5421 2.391.972 1.469.SJ3.
Add: Nonoperating Revenue Interest earnings ..... ... . .... . .. . . . . . 167,498 284.633 244,282 696,413 801.086 Other income . ... ... ... . . . . . . . . . . 147,314 25,931 5,633 - 178,878 189,772 Gain on disposal of assets . . . ~ . . . . . . . . . . 0 1.022 0 1.022 0
. Total nonoperating revenue . . . . . 314 812 311.593 249.915 876,320- 990 818 Total income (loss) .. . . . . . 2.433.216 871.71Q (36,6341 J.269.292 . 2.460.692
' Less: Nonoperating Expenses interest and debt expense .... . . __ 1,603.012 - 752,489 485,297 2,840,798 2,781.553 Other expenses ..... ..-. . 0 0 5,2'18- 5,218 108,507 ;
Ims on disposal of assets :_ ....m 59 046 0 24.291 82 s37 134 066 Total nonoperating expenses ... . . - . . . - . . . - . . L66.1,058 752.4 B9 . 515.426 2,928.97;l 3.024.126 Net income (loss) . . 772,158 119,221 (552,060) 339,319 (563,434)
- Retained earnings, beginning of year . 5.617.778 2.644.791 (1.452.527) 6.810.042 7.373.476 Retained earnings, end of year ; - $ 6,389,936 $ 2,764,012 $(2,004,587) $ 7,149,361 $ 6,810,042 16
~ SCilEDUI.E OF REVENUE, RECEIPTS, EXPENSES . nD DISBURSEMENTS - Scliedu!c 2 BUDGET AND ACTUAL -- ELEC'IRIC SYSTEM (NON.OAAP BUDGETARY BASIS) .
For the Fiscal Year Ended September 30,1991
- )
UTILITIES COMMISSION, CITY OF NEW SMYRNA BEACH, FLORIDA NEW SMYRNA BEACH, FLORIDA Variance Favorable Budget fetital_._ (Linfarornble)
- Revenue and Receipts Direct Sales:
Electric sales .. ..,...... m.. .. .- . . . . . . . . . - . . . ... , $23,8N,981 $24.065,675 $ 260,694 Other revenues . . ... . 181,500 196,040 14,540 -
Wonoperating revenue:
Interest earning . .m... . - - - . m.. .. . 196,910 167,498 (29.412)
Other revenues (expenses) - . m.-- . . .
120.000 147.314 r22.686)
Total revenue and receipts ; . 24.353.391 .2.4.526.527 ).23.134 Operating Expenses Power production and fuel . .. .. . . . . . .....: ., , . 14,675,000 14,938,235 (263,235)
Transmission and distrioution . . . . . . . - . . ...: 1,412,200 1,462,839 (50,639)
Customer accounting . . .....m.. -
..;; . . . . . . . . . . . . . .. 477,818 464,453 13,365 Administrative and general . . .. . - - - _ . _ . .. . .
.- . 2,231,178 2,264,091 (32,913)
Required payments to the City of New Smyrna Beach . .... _ 1.436.699 1.440.n22 (3 323)
Total operating expenses ..... ., ......m= ,
_29232.895 _ 20.569.64Q J336.7451 Net revenue and receipts . . . . . -. . 4.120.496 4.006.887 (113.6091 .
Operating Transfers -
Sinking Funds:
1978 Certificates . . .... ...m..... . . . . . . . . . . . . . . . . . . . . . .. 1,005,159 1,005,159 0 1986 Certificates ..... . . . . . . . . . . . . . ... ...m.... 544,165 544,165 0 1987 Certificates ..... . m: . . . . . . . . . . . 331,954 331,954 0 1990 Certificates ... m.: . -= . 310,980 310,980 0 FMPA Pooled Loan . . . - . . .. ... . . . . . .
91 542 01542 0 2 283.800 _2.2H3.800 0 Renewal and Replacement Funds:
Required contribution ...-- .. . .. . . .. 1.456.056 1.456.056- 0 Total operating transfers . ..x J.739.856 1730854 0 Budgeted net cash receipts . .. .. . .. m.. $ 380,640 267,031 $ (113,609) w Additions (Deductions) Required to Reconcile Net Cash Receipts to Net income (GAAP) Basis Principal portion of required Sinking Fund transfets - . . . . . . . .
530.877 Excess Sinking Fund transfers . . -- - . .. .. . - . . . 203,751 Net transfers to Renewal and Replacement Fund . . . 1,456,056 Gain (loss) on d!sposal of property and equipment . (58,046)
Depreciation and decommissionmg ...~... .m; (1,572,671)
Amortization of debt expense :- . ..
J5.3.S101 TOTAL ADJUSTMENTS ... -- ..
. 505.127 NET INCOME (LOSS) .. .. .
$ 772,158 17
+
sci!EDUl"/. OF REVENUE; RECE! PTS, EXPENSES AND DISBURSI.MENTS - Schedule 3
- B(IDCriT AND ACTUAL - WATER SYSTEM (NON.GAAP hUDGETARY BASIS)
For tk,r Fiscal Year Ended Septeraber 30,1991 UhlTIES COMMISS*0N, CTIY OF NEW SMYRNA BEACH, FLORf0A
' WEW SMYRNA BEACH, FLORIDA i
Vadance Favorable Bud tc1._., Actual (llafaygrable) 4 Revenue and Receipts Direct Sales:
Water sales .. .. ..... ... _ ..- .. . $ 3.492,567 $ 3,320,850 $ (171,717)-
Other revenues . . . . . 99,000 93,390 (5,610)
Nonoperatmg revenue:
laterest earnings _... . _.
. .. .. 424.460 284.633 (139,827)
Other revenues (expenses) .. .. ...m.. 10,000 25.931 15,931 .
Connection fees ........ .~... .... . ..~.~. 351,306 359.662 8,356 Meter setting installation charges . . 100.000 60.70.1 (39.296)
Total revenue and receipts ... -- . . . . . .. . . . . - . . . . . = 4.477.333 _ 4.145.120 (332.163)
.Openting Expenses Water production . . . .. ..... .... .. .. . .. x-- 826,526 779.837 46,689 Tmnsmission and distribution .. -- _m .... . . 450,094 378.519 71.575
~ Customer accounting : ... . . . . . . . , .... . . . . 187,114 179.183 7,931
= Administrative and general . _ . . . _ . , . .
. . . 929,018 857.324 71,694 Required payments to the City of New Smyrna Beach . ... ., _ 214.354 _. 201.595 12.75.2 Total operating expenses . . . . . .
_ 2.607.106- 2.396.453 210.643 Net revenue and receipts . .. ,_ ...._, _ . LS2D.222 l.20.712 011515).
- Operating Transfers Sinking Funds:
1978 Certificates ... ......~. . . . . .. 561,663 561,663 0 1987 Certificates m. ... . . _ .. 354.084 354,084 0 1990 Certificates ... . .. ~. . .. . . . . . 822,825 822,825 0 FMPA Pooled Loan - . . . . .
61.655 61.655 _0 1.800 227 . 1.800.222 - .0 Renewal and Replacement Funds:
Required contribution - .. ......~.; 211,958 211,958 0 Restricted fund contribution .. ... .. , .. 351.306 359.662 8.356 563.264 571.620 8.354
- Restricted fund contribution for operations -.
07.f434 _532.634 0 Totaloperating transfers . . . . . 1.825.855 1.834.211 8 356 Budgeted net receipts ,...... .. . . .$ 44,372 (85,499) $ (129,871)
- Additions (Deductions) Required to Reconcile Net Cash Receipta to Net Income (GAAP) Basis
. Connection fees ... .__ _ _ . . (359,662)
Meter setting insta'Jation charges . _ _ _ . . . . . . . . . . ~ . . . . . . . (60,704)
. Principal portion of required Sinking Fund transfers m.. . 278,630 Excess Sinking Fund transfers . .__ . . __ ..... . . 692.574
. Net transfers to Renewal and Replacement Fund . . . . 33,984 Gain (loss) on disposal of property and equipment . 1.029
. Depreciation : z.. . . . . . .... (457,665)
Amortization of debt expense . . . . .. . , ..
(?'hiM)
Total adjustments - . _ . . . . . . . . .
_ _ 201.220 Net income (loss) ..- -
. .. . . . . $ 119,221
=
18
n
? SCllEDULE OF REVENUE, RECEIPTS, EXPENSES AND DISilURSEMENTS - Schtdule 4 BUDGET AND ACTUAL - POLLUTION CONTROL SYSTEM (NON.GAAP IlUDGETARY BASIS)
For the Fiscal Year Ended September 30,1991
' UTIUTIES COMMISSION. CITY OF NEW SMYRNA BEACH, FLORIDA NEW SMYRNA BEACH, FLORIDA Variance Favorable Revenue and Receipts Direct Sales: i Pollution controlcharges : . - - - . - .......... $ 2,580.604 $ 2,429.325 $ (151,279)
Other revenues .. ... . .. ....~.. . .. . .m 6,600 7,978 1,378 Noroperating revenue:
Interest earnings . = - . . . . . . . . . . . . . . . . - .-. , . . . . . . . . . . . 248,630 244,282' (4,348)
Other revenues (expenses) ... , . . . . . . 1,000 395 . (605)
Connection fees : ... .. ..... 482.952 336 500 (146 452)
Total revenue and receipts .- ... ....... .. ..-. ... .- . .. ... . 2.312.26.6 2.Q18,480 [3.QM06)
Operadng Expenses -
Collection and treatment system . . . . . ... . . . . . . 1,098,740 1,148,527 (49,787)
Customer accounting , . ...... . ... . . . . . . . . . . . . . . . . . . . . . . .. 114,981 110.224 4,757 -
Administrative and general ... . ... . . .- . .
......_. . - . 753,863 735,178 18,685 Required payments to the City of New Smyrna Beach - . . . . . . . 154,836 144,272 10.564 Total operating expenses . ... .. ...... .... ... ... ... .. . 2.122.CQ 2,138.2Q1 (15.781)
Net revenue and receipts . =.. ... .. _ ..._.. .-_ . . . . . . 1.197.366 830,222 (317.03.2).
Operating Tramfers Sinking Funds:
1978 Certificates . ..... ... ,. .. ...... .- . . . .m . . . . . . . . . . . . .. 517,272 517,272 0
- 1987 Certificates - ..... . . . . . . . . _ . , .. . . . . . . . . . ............ 51,637 51,637 0 1990 Certificates . . ..... .... .. . . . . ........ 76.232 76,232 O FMPA Pooled Loan ..., - - ., ... - . . . . . . . . . . . . . . . . .~ . . . . . . . . . . . . u. 15.B03 M 803 0 700,914 700.944 0-Renewal and Replacement Funds:
Requ'~d contribution .-. .. , .. ..-. . . . . . . . . . . . . . . . . . . . 102.092 102.092 0 Restric.ed fund contribution . _ _ . . . . . . . x . . , .
482.952 336.500 __(14.63 52) sRS.QM 438.592 (1d6A52)
Sewer Assessments Fund:
- . Contribution foroperations =- . 88_622 88.6.22 O Totaloperating transfers . -. . . . . . . . . . . - . ....... 1.197.366 1.050.914 (1.,#4521 Budgeted net cash receipts . . . . . . . . . . . . . . . . . . ,, . $ 0 (170,635) $ (170,635)
- Additions (Deductions) Required to Reconcile Net Cash Receipts N Net (Loss)(GAAP) Basis
. Connection fees ... . - .. - - - - . . .. . . - - - -- --
. . . . . . . . . . . . .. . . . . . .. (336.500)
Principal portion of required Sinking Fund transfers .. . . . . . . . . . . 175,493 Excess Sinking Fund transfers . . . . __ _____ - - - . . - . . . . . . . . . . . . m...... 55,148 Net transfers to Renewal and Replacement Fund : . 138.592 Transfer from Sewer Ar.essment Fund . - . . .. =._ (88,622)
Gain (loss) on disposal of property and equipment . . . . . . . . . (24.891)
Depreciation . ......
x............... .. . .. ...... (585,651)
Amortization of debt < xpense : .i .. ... .. f 14.9941 -
Total adjustments .. .. . . . . . . . . - .. .. . . . . . ... . . . .. (381.4251 Net (loss) . .. . . . .. ......m.. . . . . . . . . . . . . $ (552.060) 19
1
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T SCllEDULE OF OPERAT.!NG l'XPENSES - Schedule 5 ELECTRIC SYSTEM -
.%r tho Fiscal Yeus E.nded September 30,1991 and 1990
- UTILITIES COMMISSION, CTIY OF NEW SMYRNA BEACH, FLORIDA
' NDV SMYRNA BEACH, FLORIDA
< 1991 _.. 1999 Fows enduction and Fuel:
3 Nuclear Power Generation:
Fuel: . :..~.- .........-.........-
$ 174.614 $ 112.277
- Operation . . . . . . . . . . - .- . . . . . . . . . . . 4v5,190 365,752 Maintenance .. ... .. .. ; 274,034-
. . . . . . . - . . . . . . . . = . . . . . . 331,783 Diesel Power Generation: .
F u el .... ... .. .. . . . .. .. 529.827
. . . . . . -. ... 516.534 Optation.- : --
= . . . . . . 473,962 520,163
' Maintenance . -
. . . . . . . . . . . . . . - - . . . 64,968 225,809 Other Power Supply:
' Purchased power 1.. ..
-...._. . . . _ . . ... 12,540,062 11,772,768
.-System control and load dispatching - . . . . . . . . ~ . ._. 3.85.5ZS _216.214
,,,.L4.9.33.23 5 14.191.470 Transmission and Distribution:
. Operation . . .... . ... .. : _ . . . . . 1,124.420 1,049,794 Maintenance .. . . . . . , , . . . . . . __ 338.419 376 013
._1.3h2.012 1.426.7QZ Customer Accounting:
Operetion m......~... . . . . . . . . . = . .- =.- .. ~ ~ ~ . . 4h1352 _ d2Zl31 Administrative and General:
. Opration . .. ... . . . . . . . . . . = . - . .. - , .. -2,105,855 1,948,781
. Maintenance . . .. . -
. .. ... ... _.15fL226 123.63Z 2.264 091 2.072.418 Required Payments to the City of New Smyrna Beach . .-- ~ ~...~. . . . 1.440.022 1.387,110 State Utilities Taxes . .
. . - . . . - - - - . . - . - - . - -.. 0 321,159 Depreciation and decommissioning . - . . . . . . - ..-. l.573.671 . 1.469.516
- Total operating expenses - - . . - . .. . $22,143,311' $21,334,511 20
+
t SCIIEDULE OF OPERATING EXPENSES - Schedule 6 VIATER SYSTEM
~ For the Fiscal Years EnN September 30,1991 and 1990
- UT11JTIES COMMISSION, CnY OF NEW Shn'RNA BEACH, FLORIDA
- NEW Shn'RNA BEACH, FLORIDA -
1991.. _, 192Q
. Water Production:
Source of Supply:
- Opcration. - . . . . . = . . = . . . . . . . . . . . . . . . . . . . .. . ... . $ 61,511 $ 60,026 Maintenance .... ... ... . ... . . . . . . . . 12,060 22.410
' ' v aping:
. Operation .. .. m .. ................................ . . . _ - . . . .. 148,923 146.349
- Maintenance ... ... --- ...:. .. ... . . . . . . . - . . . . . . . ... . , . 3,017 4,877 Water Treatment:
Opcration .. .. . .. .. = :- : ................................ 546,300 535,659
. Maintenance .... : . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . a.02S 10.822 779.g32 780.2QQ Transmission and Distribution:
Operation - --- ..- . . . .... .... .. 341.170 318.294 Maintenance ... . ... . .. : -
. . . . . . . . .- . . . . . . . . . . . -. . . . . ..... 37_.349 1B.212 373.512 336 sot
' Customer Accounting:
Operation . ... . -
. . , . . . . . - . . . . . . . . . .. . . .. 17.2,1M 177 968 Administrative and Generah Operation .. . . . . . . . . . . ..-.. ..
804.899 -762,399
- Maintenance ..... ... .. x... .. . .. . , . .. s2.425. 37BHQ 857.324 800.279 Required Payments to the City of New Smyrna Beach.. . . .. . . . . . . . . . . , ....... .. . . .... 10l 2l5 22R 692 4
Depreciation .. . .. . . . . . .
. 4.57.665 426.Edd
- Total operating expenses ..... . . . . . . . . . $ 2,854,123 $ 2,750,489 i
l-l 21 i
4
' SC11EDULE OF OPERATING EXPENSES - Schedule 7.
POLLUTION CONTROL SYSTEM For the Fiscal Years Ended September 30,1991 and 1990 UT!UTIES COMMISSION, CTlY OF NEW SMYRNA BEACH, FLORIDA -
NEW SMYRNA DEACH, FLORIDA Collection and Treatment System:
1991 lod (L._
Collection and Pumping Expen>es:
Operation . .. . .. .. .... . .. . $ 383.756 $ 364,e99 Maintenance .... .. ........ . . . .. ...: - 43,160 45,090
- Treatment and Disposal Expenses:
Operation. ... . .... .. . - . .
..... . . . . . . . . . . . . . . . - . . . . . - 710,502 659A28
- Maintenance ... ... ... . . . . . . . . 11.109 24.727, 1.143.521 1.093.744-Curtomer Accounting:
Operation .. . .... . ." .- .. .. . . 110.22d 106.936 Administrative and General:
Op ration . .. ... -... ..-: ' ' * . . 702.599 638,691 Maintenance ..-....~ ' * * " ' ' ~ " " * - .. 32.579 30.4ft4 733 lig _M9.1M
.Requirad Payment to the City of New Smyrna Beach . . . . . . 144.272 Ig,43 Depreciation .. ... .. .. .. .. . + ~"
~
- """ "' '" ' ~
. Total operating expenses . - "-- - . $ 2 723,852 $ 2,587,379 m
22 11
se._
SCIIEDULE OF INTEREST EARNINGS Schedule 8 -
For the Fiscal Years Ended September 30,1991 and 1990 -
LIT!!InES COMMISSION, CITY OF NEW SMYRNA BEACH, Fl.ORIDA NEW SMYRNA DEACH, FLORIDA
, 1991 1990
-Interest Earnings By Source From Investments:
- Sinking funds . . . ..;- - - - .. . . , . . . . . . . . . . . . . . . . . . . $ 294.236 $ 337,352 Renewal and replacement funds .. . ..... .. . . . . ~ . . . . - . . . 255,801 291,752 Customers' de . . . = ...
39.834 50,677 Other .... ....... posits .:
81.84?. 90.006 <
671.713 769.787
' From Assessments - . . . . . .
24.709 31.299 Teital interest earnings . ... . .. ....... ... .. .. . - . . . . . ... .. . . . . - . . . , $ 696.413 $ 801,086 m- . ._
Interest Earnings By System Electric system - .- .. . . - . .. 167,498 5 191,359 Water system .. ... . . .... .... . ... - . -
. . . . . . . . - , . . . . . . . . 284,633 330,794 Pollution control system . = . .. 244.262 278 933 Total interest earnings ...... .......... ,, . ., $ 696,413 $ 801,086 23
SCHEDULE OF DEllT SERVICE REQUIREMENTS TO MATURITY Schedule 9 For the Fiscal Year Ended September 30,1991 Page 1 of 2 ImlII1ES COMMISSION, C11Y OF NEW SMYRNA BEACif, FLORIDA
. NEW Shn~RNA BEACH, FLORIDA Utilities System Revenue Refunding and improvement Certificates, Utilities System Revenue Improvement Certificates Series 1978 Series 1986 Payment - Total Coupon Total Date Princinal Coupon Rnte . Interest . Requirements Principal Rate interest Requirements 10-1-91 $ - 275,000 6.300% $ 767,873 $ 1,042,873 $ 105,000 5.600 % $ 219,582 $ 324,582 04192 285,000- 6.350 759,211 1,044,211 216,643 216,643 10-1 92 290,000 6 350 750,162 1,040,162 110.000 5.800 216,642 326,(A2 04 1-93 300,000 6.400 740,954 1,040,954 213,453 213,453 -
-10193 310,000 6.400 731,354 1,041,354 115,000 6.000 213,452 328,452 04194 320,000 7.000 721,434 1,041,434 .
210,003 210,003 10-1 94 330,000 7.000 - 710,234 1,040,234 120,000 6.200 210,002 330,002 '
04195 345,0CJ 7.000 '698,634 1,043,684 206,'183 206,283 10195 355,000 - 7.000 686,609 -1,041,609 130,000 6,400 206,282 336,282 04196 370,000 7.000 674,184 1,044,184 202,123 202,123 10-1 96 . 380,000 7.000 661,234 1,041,234 135,000 6.500 202,122 337,122 04197 395,000 7.000 647,934 1,042,934 197,735 197,735 10-1 97 410,000 7.000 634,109 1,044,109 145,000 6.600 197,735 342,735 04 1-98 425,000 7.000 619,759 1,044,759 192,950 192,950 10-1 98 435,000; 7,000 604,884 1,039,884 155,000 6,700 192,950 347,950 04-1 99 455,000 7.000 589,659 1,044,659 187,758 187,758 101 99 470,000- 7,000 573,734 1,043,734 165,000 6.800 187,757 352,757 64100 485,000 7.000 557,284 1,042,284 182,148 182,148 10100 500,000 7.000 540,309 1,040,309 180,000 6.900 182,147 362.147
-04 101 520,000 7,000 522,809 1,042,809 175,938 175,938 10-1-01 540,000 7.000 504,609 1,044,609 190,000 7.000 175,937 365,937 04-1 02 555,000 7.000 ' 485,709 1,040,709 169,288 169,288 10102- 575,000 7.000 466,285 1,041,285 205,000 7.250 169,287 374,287
'04103 595,000 7.000 446,160 1,043,160 161,857 161,857 10-1-03 615,000 7.000 425,335 1,040,335 220,000 7.250 161,856 38L856 04104 640,000 7.125 403,810 1,043,810 153,881 153,881 10-1 04 - 660,000- 7.125 381,010 1,041,010 235,000 7.250 153,881 388.881 04-1 05 685,000 7,125 357,497 1,042,497 145,363 145,363-10-1-05 710,000 7,125 333,094 1,043,094 250,000 7.250 145,362 395,362 04 106 735,000. 7.125 307,800 1,042,800 136,300 136,300 '
10-1 06 760,000 .7.125 281,616 1,041,616 270,000 7.250 136,300 406,300 04107 790,000- 7,125 254,541 1,044,541 126,513 126,513 10-1 07 - 815,000 - 7.125 226,397 1,041,397 290,000 7.250 126,512 - e16,512 04108- 845,000 7.125 197,363 1,042,363 116,000 116,000 -
10-1 03 875,000 7.125 167,259 1,042,259 310,000 7.250 116,000 426,000 04-1 09 905,000 7.125 136,088 1,041,088 104,763 104.763
.10109 940,000 7.125 103,847 1,043,847 330,000 7.250 104,7 7 434.762 04 110 970,000 7.125 70,359 1,040,359 92,800 92,800 10-1 10 1,005,000 '
7.125 35,803 1,040,803 355,000 7.250 92,800 447,800 04 111- 79,931 79,931 10111 380,000 7.250 79,931 459,931
' 04-1 12 66,156 66,156 10-1 12 410,000 7 250 66,156 476,156 04-1 13 51,294 51,294 10-1 13 44D,000 7.250 51,294 491,294 04114 35,344 35,344 10-1 14 470,000 7.250 35,344 505,344 04 1-15 18,306 18,306 10-1-15 .._.503,000 7.250 _ 18.306 _.-_5213.06
$21,870,000 $18,776,996 $40,646,996 $ 6,220,000 $ 7,105,229 $ 13,325,229 a .
24
- SCllEDULE OF DEBT SERVICE REQUIREMENTS TO MATURITY Schedule 9.
. For the Fi cal Year Ended September 30,1991 Page 2 of 2 UTIUTIES COMMIS510N, CITt OF NEW SMYRNA BEACH, F1.ORIDA NEW SMYRNA BEACH, F1.ORIDA Utilities System Refunding Revenue Certificates, Utilities System Revenue Certificates Series 1987 Series 1990 Payment Coupon Total Coupon Total Date Prineinal Rnte intutst._ -Recuirements Priqqip;d Rate Intereit ReaMcmcata 10-191 - $ $ 258,713 $ 258,713 $ 165,000 5.900 % S 522,519 $ 687,519 04-1 92 220,000 5.200 % 258,712 478,712 517,651 517,651 1 92 252,993 252,993 175,000 6.000 517,651 692,651 04193 230,000 5.400 252,992 482.992 512A01 512,401 10-1 93 . 246,783 246,783 185,000 6.100 512,401 697,401 04 1-94. 245,000 5.600 246,782 491,782 506,759 506,759 10194 239,923 239,923 200,000 6.200 506,759 706,759 04-1-95 255,000 5.800 239,922 494,922 500.559 500,559 10195 232,528 232,528 210,000 6.300 500,559 710.559 04196 270,000 6.000 232,527 502,527 493,944 493,944 10196 224,428 224,428 225,000 6.400 493,944 718,944 041 97 285,000 6.200 224,427- 509,427 486,744 486,744
._10197 215,593 215,593 240,000 6.500 486,744 726,744 04198 305,000 6.400 215,592 520,592 478,944 478.944 10-1 98 205,833 205,833 255,MO 6.600 478,944 733,944 041 09 325,000 6,500 205,832 530,832 470,529 -470,529 10199 195,270 195,270 270,000 6.700 470,529 740,529 04 100 345,000 6.600 195,270 540,270 461,484 461,484 10-1,00 .
183,885 183,,885 295,000 6.750 461,484 756,484 04101- 370,000 6.700 183,885 553,885 451,528 451,528 J 10101 171,490 171,490 310,000 6.800 451,527 61,527 04102 390,000 , 40 171,490 561,490 440,988 440,988 10102 157,840 157,840 330,000 7.000 440,987 770,987 G4103 420,000 7.000- 157,840 577 40 429,438 429,438 10103 143,140 143,140 355,000 7,000 429,437 784,437 04 1-04 445,000 7.000 143,140 588,140 417,013 417,013
.10-1 04' 127,565 127,565 375,000 7.000 417,013 792,013 04105 480,000 7.000 127,565 607,565 403.888 403,888 10105 110,765 110,765 405,000 7.000 403,888 808,888 04106 510,000 7.000 110,765 620,765 389,713 389,713 10106 92,915 92,915 435,000 7.000 389,713 824,713 04-1 07 . 545,000 7.000 92,915 637,915 374,488 374,488 10 1-07 73,840
- 3,840 465,000 7.000 374,488 839,488 04108 585,000 - 7.100 73,840- 658,840 358,213 358,213 10108 53,073 53,073 195,000 7.000 358,213 853,213
, 04109 630,000 7.100 53,072 683,072 340,887 340,887 101 09 30;708 30,708 535,000 7.000 340,887 875,8S7
~04110. 670,000 7.100 30,707 700,707 322,162 322,162 10110 6.923 6,923 . 570,000 7.100 322,162 892,162 04 111 195,000 ~ 100 6,922 201,922 301,927 301,927
- 10-1 11 610,000 7.100 301,927 911,927 04112 280,272 280,272 10112 655,000 7.100 280,272 935,272 041 13- 257,020 257,020 10113 -700,000 7.100 257,020 957,020 04,It14 232,170 232,170 10-1 14 755,000 7.100 232,170 987,170 04-1-15 205,367 205,367 10115 805,000 7.100 205,367 1,010 367
.04 116 176,790 176,790 103.16 1,145,000 7.100 176,790 1,321,790 04117 136,142 136,142 10-1 17 1,210,000 7.100 136,142 1,346,142
-04 118 93,187 93,187 10-1 18. 1,280,000 7.100 93,187 1,373,187 OAl 19 47,747 47,747 10-119 L345.000 7.100 47.747 L392.747
$ 7,720,000 $ 6,448,405 ~$14,168,405 $ 15,000,000 $20,698,426 $35,695,426
~ ~ -~ *-
25
SD1T/S7/ CAL SECT /ON S!J!&t ?altables di%vkorn knancialstaternents because they usualy tovermore
'han one 3: ca/yattand<>h7)'presenttrvi accountit?!] data. ThPSP /Jb!t ?S re/lPCf Sach!r." Yeronorn:d data andhnancultrenW oft /10 Ultta>s Corrynisskxl City of NewSrnytnaSex/1.
1
. _ _ _ w e __ _
_ ,..._. . . _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ~ t- Am SCllEDtil.E OF EXPENSES BY FtMCTION LAST TEN FISCAL YEARS September 30, UT11JTIES COMMISSION, CTlY OF NEW SM.T' J 4A I\EACil, FLORIDA NEW SMY}U4A DEACll, FLOPdDA Qgerating Expenses __
Requited Transmission, Payments Fiscal Total Production Distribution and Customer Administrative and to City of New Smyrna g
Year Fg enses Expenses Colkn[cn_, Accounting General Beach 1982 $14,921,572 $7,297,762 $1,409,742 $315,595 $1,776,286 $326,719 1983 16,968,400 8,241,667 1,420,397 400,372 2,079,755 877,629 1934 18,388,070 8,686,618 1,710,284 496,921 2,214,716 1,047,779 1985 20,725,373 10,601,458 1,868,923 547,952 2,311,726 1,122,521 1986 21,45~. 417 10,599,170 2,044,229 565,05'i 2,581,264 1,209,499 1987 24,012,890 11,918,184 2,430,767 614,138 2,856,752 1,301,571 1968 25,687,082 12,681,390 2,657.153 647,001 2,888,994 1,481,102 1989 27,368,501 13,793,020 2,795,429 660,210 3,025,338 1,589,082 1990 29,656,505 14,971,670 2,856,957 . , "5 3,541,852 1,781,241 1991 30,650,;$9 15,718,072 2,989,885 ,
.i7 3,856,593 1,785,889 26
M' Table i Opnanngfstenses Neno;; rating Expenses State Depreciation Total Interest Other Total Utilities and Operating and Debt Nonoperating Nonoperating Tax DInmniirsioidDg__.1Xpense Expense 13 pense Exp.cnses
$84,350 $1284,052 $12,994,506 $1,927,066 $0 $1,927,066 04,181 1,r '. 5,523 14,619,524 2,314,563 34,313 2,348,876 145,297 1,604,757 15,906,372 2,465,284 16,414 2,481,698 170,406 1,661,220 18,284,206 2,375,681 64,486 2,441,167 241,059 1,705,287 18,946,565 2,421,468 83,384 2,504,852 243,184 1,929,252 21,293,848 2,583,191 135,851 2,719,042 291,18'/ 2,218,323 22,865,150 2,775,470 46,462 2,821,932 303,843 2,322,753 24,494,675 2,737,217 136,609 2,873,826 321,159 2,447,565 26,642,379 2,781,553 242,573 3,024,126 3,293 2,616,937 27,721,286 2,840,798 88,175 2,928,973 27
tm _ .__.
SCllEDUI.E OF REVENUES IlY SOURCE LAST TEN FISCA1. YEAltS Septemt,er 30, UTilmES COMMISSION, CITY OF NEW ShnTSA BEACil,1101UDA NEW SMYRNA BEAC11, FE0ftIDA Qperating Revenues Pollution Total Fiscal Total Electric Water Control Operating
_ _Ye n t Revenues _A1. tat Svrtem Sysjem Reyen),it_ g 1982 $14,937,949 $11,152,100 $1,456,125 $1,111,216 $13,719,441 1983 16,541,534 12,026,330 1,980,611 1,178,922 15,185,863 1984 19,010,464 13,800,307 2,430,016 1,291,324 17,521,727 1985 20,792,509 15,473,671 2,615,605 1,446,702 19,535,978 1986 21,204,306 15,745,029 2,735,021 1,754,963 20,233,013 1987 23,575,256 17,714,974 2,925,916 1,831,044 22,471,934 1988 25,269,603 19,467,476 3,050,904 1,924,385 24,442,765 1989 27,431,708 20,841,500 3,184,987 2,390,120 26,416,607 1990 29,103,071 22,362,293 3,305,107 2,444,813 28,112,213 1991 30,989,578 24,261,715 3,414,240 2,437,303 30,113,258 28
_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ - - - __ - - - - - - - - - - - - - - - - - - - - - - - - ' - - " - " " - - - - ~ -
Table 11 Nenornitting.[1nsnure Total Interest Other Nonoperating
_.E.c min es Income Revenue
$1,111,615 $106,893 $1,218,508 1,144,035 211,636 1,355,671 1,076,576 412,161 1,488,737 1,091,630 164,901 1,256,531 818 337 152,956 971,293 665,119 438,203 1,103,322 668,355 158,483 826,638 818,148 196,953 1,015,101 ,
801,086 189,772 990,858 696,413 179,907 876,320 29
___________.________________________________._____________m____. _ _ _ _ _ . _ . _ _ _ _ _ _ _ _ _ _ _ . _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
DEMOGRAPlilC STATISTICS Table !!! ..
LAST TEN FISCAL YEARS Septemler 30, UTIUTIES COMht!SS10N, CnY OF N!.W ShriRNA 15EACll, TLoluDA DEW ShtYRNA BEACll,I LORIDA New Smyrna Beach's Per County School Estimated Capita Unemployment School Percent Fiscal Population Income Rate Enrollment Attendance Year (11 (31 (4) , (5) ($1 1982 $13,653 59,734 (4) 6.8 % 3,318 96 %
1983 13,829 10,220(2) 6.7 3,665 97 1984 14,104-(2) 10,629(2) 5.2 3,710 97 1985 14,697 u) 11,593 (2) 4.4 3,662 97 1986 15,000(2) 11,719(2) 5.0 4,123 96 1987 15,344 11,719 (2) 4.9 4,219 96 1988 15,647 11,800 4.4 4,240 94 1989 17,266 13,401 4.5 4,445 95 ,
1990 18,600 (6) 13,937 5.6 4,488 96 1991 16,543 (3) 14,606 7.3 4,663 95 (1) Obtained from University of Florida, Bureau of Economics and Business Research.
(2) Estimated, actual amounts not available. -
(3) Obtained from U.S. Department of Commerce, Bureau of Economic Analysis, (4) Obtained from State of Florida, Department of Labor and Ernployrnent Security.
(5) Obtained from Volusia County School Board includes grades K 12, Coronado Beach Elementag, Chisholm Elementary, New Smyma Beach Middle School, New Srgrna Beach Scruor High Read.Pattillo Elementary and Sacred Heart, a private school.
(6) Obtained from the City of New Smyrna Beach 1990 Comprehensive Land Use Plan.
i 30
w._. . .- '"
PAOptn*rY VALUE, CONSTRUCTION AND BANK DEPOSITS (4) Table IV
! AST TEN FISCAL YEAftS Septemter 30 UTILITILD COMMISSION, CT!Y OF NEW SMYRNA BEACll, FLOPdDA NEW SMYRNA BEACll, FLORIDA Savings
_ Con <tructipn (1) and
, _ Number Value Bank Loan Property Fiscal of of Deposits (2) Deposits (2; Assessed Year 2rrmits Ctnuradip,n f000's) (000's) Vf hie (3) 1982 550 $11,111,417 5104,324 $192,305 $421,495,317 j 1983 718 23,730,247 123,924 222,419 479,806,754 1984 937 35,666,534 144,154 260,142 550,410,029 1985 2,006 32,782,563 166,126 267,464 632,540,204 1986 2 286 P6,095,656 192,712 251,404 711,561,352 1987 2,501 26,927,079 185,428 306,928 7 63,718,138 1988 2,246 30,639,766 190,477 284,244 834,037,543 1989 2,5C2 23,381,587 244,312 228,568 894.693,552 ,
1990 2,416 27,491,710 310,746 285,541 975,234,226 1991 2,333 22,309,940 379,110 300,960 1,026,339,359 (1) Obtained from the City of New Smyma Beach, Florida, Building Department (2) Obtained from inquiry with officials of banks and savings and loan associations (3) Obtained from Volusia County, Florida, Finance Department (4) The above data is telated exclusively to area within the municipal Smits of the City of New Smyrna beach, Florida 31
m SCllEDULE OF INSURANCE IN FORCE Table V September 30,1991 UTILITIES COMMISSION, CilY OF NEW SMYRNA BEACll, FLORIDn NEW Shri.TsNA BEAcil FLORIDA Coverage and Policy Policy insurinc company Number Period Detaib of CoYmge ..Mability Limits Compreheralve General Liability:
Nutmeg insurance Co. 21CENSQ9265 12-01 90 Combined todily injury $1,000,000 12 01-91 and property dsmage Business Auto:
Twin City Fire 1nsurance Cornpeny 21UENQK0216 12 01 90 Liability $1,000,000 bcdily injury 12 01 91 and property combined Compreheruive Actual cash value less
$250 deductible Collision Actual cash value less
$500 deduetible Uninswed motorist $100,000 No fault Statutory Business Property:
American Guarantee and Liability lasurance Co. CpP330867005 12 01 90 Buildings and contents $15.214,924 with 12-01 91 $10,000 deductille and 90% co fruutance Accounts receivable $850,000 with 5500 deductible Valuable papers / records $100,00te with $500 deductiba Contractors' equipment $455,983 w th 5500 deductible Computer equipment $160,000 witt. %500 deductible Crime:
Aetna Casualty and Surety Co. 35BY100539780 12 01 90 Employee crime $100,%0 aggregate BCA 12 01 91 $1,000 deducuble Money and securities $50,000 Counterfeit currency $5,000 Depositors
- forgcry $'100,000 Boiler and Machinery:
Great Northern insurance Co, 7827 44 32 09 30 91 Breckdown due to $5,000.000 with 09 30 92 accident $10,000 deductible Nuclear Energy Damage:
American Nuclear Insurance and Mutual Atomic Enerry Liability Underwriters and Nuclear Electric lasurance Ltd. 90147 10 09-90 Primary preperty $500 million 10 09-91 X90147 & X90015 11 15-90 Excess property $1.125 billion 11 15 91 (Excess of $500 million)
NF195 & MF91 01 01 91 Primary liability $200tnillion 01-01 92 NS347 & M565 12-31-90 Suppliers and $200 million 12 31 91 trnnsporters liability N-35 & M 35 01 01 91 Secondary financial $30 million per 01 01 92 protection occurrence NW103 & NW62 01 01 91 Master Workers Torts $200 million aggregate 01 01-92 Public Official / Employee Liab2ity:
International Surplus Lines Ins. Co. 5241170AS-9 07-28-91 Liability $500,000 retentici s 07-28 92 $10,000/ loss Workers' Compensatier:
Florida Municipal Self Insurers' Fund 109 10-01-91 Statutory coverage Statutory 10-01 92 Emplo>ers liability $100,000 32
,_m__.,___,__ _ _m_ _--__ _--._____---- - - - - - - - _ - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - "- -
m -iE . _ _ . __. ._ _ _ _ _ . _ . . _ , _, .
TEN LARGEST ELECTRIC CUSTOMERS Table VI Septemter 30.1991 U11U11ES COMMISSION CITY OF NEW SMYRNA DEACIL TLORIDA N'EW SMYRNA DEACil, FLORIDA
_ Kilowatt Hour Sairt. Revenues P,illd Percent Percent (kWh) of of (000's) Total Amotst TqinL.
1 Fish Memorial Hospital 4,590 1.72% $364,215 1.52 %
- 2. Publix Food Store (#0191) 3,083 3.16% 249,511 1.04 %
- 3. Publix Supermarket (h 0335) 2,635 0.99 % 210,456 0.88 %
- 4. Utilities Commission 2,501 0.94 % 202,859 0.85 %
- 5. Food Lion (#829) 2,145 0.80 % 173,623 0.73 %
- 6. K Mart 2,030 0.76% 168,495 0.70%
7, Board of Public Instruction 1,955 0.73 % 188,936 0.79%
- 8. Winn Dixie Store (#2302) 1,945 0.73 % 156,199 0.65^ 6
- 9. Board of Public Instruetion 1,901 0.71 % 170,750 0.71 %
- 10. Islander Beach Lodge .. 1.742 045% 14(W 2 . 0.61 %
TOTALS 24,527 9.19% $2,031,886 8.50%
33
~~
._. w
--- _. T**
TEN LARGEST WATER CUSTOMERS Table Vil Septemter 30.1991 UTluTIES COMMISSION, CITY OF NEW SMYRNA BEACil. ILORIDA NEW SMYRNA BEACll, FLORIDA 1&Q1klID2.dCD EeVenuefE M _
Percent Persent Gallons of o' J0QO s) Total Amennt Tohl
- 1. IDC (Do achelle lsland) 23,075 1.95 % $40,016 1.22 %
- 2. Seawoods Homeowners Association 17,226 1.45% 23,093 0.73 %
- 3. Board of Public Instruction 12,632 1.07 % 24,170 0.74 %
- 4. Rinker Materials 12,133 1.02 % 14,423 0.44 %
- 5. Cedar Dunes Homeowners 11,739 0.99% 15,176 0.46%
- 6. Pelican Association 11,653 0.98% 19,92/ 0.61%
- 7. Sugartree Apartments 11,400 0.96% 16,504 0.50%
- 8. FederalHousing Authority 10,924 -0.92% 16,997 0.52 %
- 9. Sandpipers Owners Association 10,893 0.92 % 20,115 0.61 %
- 10. Oceanview Nursing Home ,_,1QJf52 _ 0.87% ._1; LOB 2 _Q3n TOTALS 132,027 11.14 % $204,303 6.22 %
34
1 GEN 1'.RAL UTILITIES COMMISSION INFOllMA O DN Table Vill September 30,1991 Page 1 of 3 UTIL117ES COMMISSION, CITY O!' NEW SMYRNA BEACH, TLOIUDA NEW SMYRNA BEACH, FLORID A 7NE cul/J//SS/ON 6. hnf &se, Sm. 7hus. (term expires September 1994)
The Commission was established in 1965 and chartered in 1967 Mr. Heise has over thirty years experience in the Real Estate through the passage of Chapter 67 1754, l.aws of Florida, (The Deselopment field, slanted towards his specialty of major shop-Enabling Act) which amended the Charter of the City of New p;ng centers. He attended Colorado State University and otu Smyrna Beach, Florida. Apprvved by referendum vote of the tained a Bachelor of Science degree in business management. He citirens of New Smyrna Beach on October 24,1967, the Enabling has completed nu.nerous courses and seminars regarding ad.
Act created the Utilities Commission as an appointive body with vertising, promotion, management, real estate taxation, etc. and full and ev.clusive authority to the extent permitted by law over has a Florida Real Estate Brokers license. Mr. licise is currently the management, operation and control of the City's utilities. President of Suneo Advisory & Development Corporation. lie held a position with the El Paso Natural Gas Company in their The Commission consists of five members who are appointed by accounting departinent and has worked very closely with many the City Commission. Members are pa!d a salary of $100 each utility companies during the development of commercial prop.
month. Officers of the Commission cortaist of a chairman, vice- erties. He has served on various be stds that oversaw budgets chairman, secretary-treasurer and assistant secre'ary treasurer and set policies. Mr. Heise was appointed to the Commission in elected by and froin the membership which also appoints a Diree- September,1991 for a three year terra.
tot of Utilities. The Commission has the duty to fix rates and the power to sell revenue certificates. All revenue certificates of the Hemn/A. Partwr, ./r., Arst. Sm. 7hus.(term expires $cp-Commission are obligations of the Comruission. The Commission tember,1992) has no power to pledge the full faith and credit of the City of New Smyrna Beach. Mr. Paxton retired from the United States Air Force with the rank of Colonel after thirty years of senice. Mr. Paxton's military no in a referendum held October 2,1984, the voters of the City of complishtnents included numerous operations and commanci as-New Smyrna Beach approved amendments to the City Charter, signmer ts. lie was a recipient of sigruficant decorat iens and "Ihe amendments limit a Commissioner's term to three years in- hwards. Mr. Paxton is a nathy of New Smyrna Beach and in stead of five with no more than three ecnsecutive terms require addition to military education and faculty participation at a City Commissinn approval for extensions of utility senices out. number of military schools / colleges, did undergraduate study side the city limits, give the City Commission the right to review work at the Univers;ty of Maryland and George Washington Uni-and approve the Commission budget, and require City Commis- versity. At the precent time, Mr. Paxton is associated with a slon opproval Lefore issuing or refunding revenue certificates and local realtor. lie is a Certified Appra9er Senior w th the Amer-entering into contracts exceeding four years. ican Association of Certified Appraisers (MCA) with fifteen years of experience in this field. Mr. Paxton was appointed to the The following information describes the five curtent members of Commission ' 'eptember,1989, the Utilities Commission and the Director of Uti'ities.
./ew 4 AkEm, Cbhman (term expires Septemtwr,1992)
Mr. Pence h s over thirty years experience in the public utilities Mr. McKee has bad twenty five years banking experience and field with a nationwide telecommunications common canier, prior to entering banking, had twelve years experience in the Western Union. He is former chairman of the Republican Party in finance industry, lie holds a Bachelor of Science degree in Com. Volusia County, Mr. Pence is also a former chairman of the Util-merce and has completed the American !nsthute Banking itles Commission. He was first appointed to the Commission in Courses. He has served in the U.S. Coast Guard and the U.S. 1976 and serwd two consecutive terms until 1986. Mr. Pence Artny. He is a member of the New Smyrna Beach Edgewater Oak served as chairman from September,1980 to September,1981 Hill Chamber of Commerce, a Director of the Kiwanis Club of New and from September,1983 to September,1986. Mr. Pence was Smyrna Beach and has served on numerous boards and organiza. appointed to the Commission in September,1990, to serve n tiom. Mr. McKee was appointed to the Commission in Sep- three year term.
tember,1988 and was subsequently reappointed to serve a three year term in September.1989. R. Rona.U/hgen, DbwtorofotDl ties
.hmes v. A/xts; IXv CAahman (term expires September,1994) Mr. Hagen has ever thirty years of progressively responsible municipal utility management experience, including twenty years Mr, Martin has approximately thirty years experience within the with the Jacksorwille Flectric Authority (JEA). He has a degree railroad industry. He served in the armed forces from1941.lo46. from Jac.somille University and has substantially broa6ned his Mr. Martin has served on numerous boards including the City of background through attendance and presentation of papers at New Smyrna Beach Code inforcement Board, the Beach Advi. Industry seminars and conferences. During his tenure with the sory Board, and served as Chairman on the City Planning Board City of Jacksomille and the JEA, he headed the Statistical and for fout years. lie is et'trently associated with a local travel Accounting Department and was Dhision Chief of the Budget a}gency, Cf' Martin n tations. Mr. Travel,wns Inc., and is involved appointed with various to the Conunission. ci ic orga-and in Sep-Cost Dhision and Director of Construction and Maintenance.
later he served as Director of Customer Senice, a position he tember,1991, to serve a three year term. held tmtil his retirement in 1976. In 1978 he was employed to fill 35
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I GENERAL UTILITIES COMMISSION INFORMNilON Table Vill Septemter 30,1991 Page 2 of 3 UTILITIES COMMISSION. CITY OF NEW ShiYRNA BEACH. FLORIDA NEW SMYRNA BEACH, FLORIDA the newly created position of Controller for the Utihties Commis- electric power to its members through joint cooperation with sion. Mr. Hagen was ap;iointed Director of Utilities in June,1982. other electrie utilities in Florida. The Commission has agreed to purchase 9.B84 percent or approximately 7 megawatu, of FhtPA's 77/E #7L77ES SJS/D/ entMlement share in the St. Lucie Project. The Commission also has a reliability exchange agreement through the FMPA to ex, The Utilities Commission has been serving the residents of the change 50% of its output from St. Lucie No. 2 for a like amount New Smyrna Beach area since before 1920. Today, the Commis- from St. Lucie No.1.
slon serves approximately 18.800 electric customers, over 9,800 water customers and over 7,700 sewer customers. Encoy Contm/ Center E/EC7R/C SJS/DI The Commisslor' has operated an Energy Control Center since April,1977, which is staffed around the clock by system control The Commission cunently provides electric service to all incor. coordinators who schedule the economk loading of its generat.
poreted areas of the City. The Commission's distribution lines ing resources and the interchange of power over the interconnee-also extend west and south from the City limits to serve unin. tion with FPL using a supervisory control and data acquisition corporated areas. The senice area of the Commission's electric (SCADA) system. Telemetering of tic line energy is provided system is approximately 72 square miles, along h " hot line voice communication and messaging net-work all n.sjor power system contrul centers in Florida. A com-Cenersabn Remetw puter t rminal provides access to the Florida energy broker sys-tem.
The system's power ; ' -nergy requirements are met with a combination of self. generation and purchased power. 7).msmAshn and Bhtnbuthn Esa?Ms The Commission's generating facinties include the W.E. Swoope The Commission's transmission facilities consist of three major in.
Generating Station which consists of three diesel engine gener. stallations: the 115 kV/23 LV Smyrna and Fic!d Street Substa-ators with a combined nar eplate rating of 5,23S kW; the Diesel tions and the 115 kV transmission line tetween the two. Tb Plant located on Smith Street which consists of five diesel engine distribution sptem is suppl %d from the Swoope Station and the generators with a combined nameplate capacity of 6.540 kW and Diesel Plant as well as from the Smyrna and Field Street Substa-three 2,000 kW quick-start remotely controlled peaking units; tions. There are five 23 kV/4 kV and three 23 kV/13 kV substa-the North Causeway Plant 750 kW diesel peaking unit; and the tions on the Commission's distribution system. Energy is deliv.
Glencoe Road Plant 750 kW diesel peaking unit. ered to customers by a network of 23 kV/13 kV and 4 kV lines. A number of residential developments are now being served by The Commission owns a 0.5608% undivided interest in Florida underground electnc facilities.
Power Corporation (FPC) Crystal River No. 3 Nuclear Unit (CR 3),
with a maximum nameplata capacity of 4,991 kW avMlable to the 104 E B S TS7E M Commission. FT C operates CR 3 on behalf of itself, the Commis-sion and ten other participants pursuant to a participation The current service area of the Cornmis.; ion's water system is an ag;eement. CR 3 is used as a primary base load resource of the area of apprcximately 41.3 square miles, including 17.8 square Commission's electric sptem. miles, which is located within the City The Commission aho provides water senice to 'he unincorporated south beachside The Commhsion's total installed nameplate generation capacity, area, inchiding CR 3, is 24,266 kW, which provided 15% of the Com-mission's total energy requirements during Fisen! Year 1991. The rew water supply is derived frotu thirteen wells drawing from the Floridian Aquifer. These wells can produce capacity in Purchases from Florida Power and Light Company (FPL), City of excess of 7.7 million gallons per day (MGD). The seven wells are Lakeland (L8JO, Orlando Utilities Commission (OUC), Florida located at the Glenece Road Water Treatment Plant site. During Municipal Power Agency (FMPA), Tanipa Electric Company FY 1982, five additional wells were constructed and put in opera-(TEC) and economy purchases under the Energy Broker system tion. In FY 1987, a sixth well was put in operation. These addi-have provided the remainder for the Commission's power and tional wells are located seven miles west of the Glencoe Treat-energy requirements. The Commission has executed inter. ment Plant and are over ten miles inland to mitigate salt water change egreements providing for the purchase and sale of econ- intrusion.
omy energy with FPL and nineteen other investor owned and municipal utilities in Florida. Ths errrent raw water supply is projected to be sufficient through 1995. The Commission has implemented both a salt St. Zus Nue/arrrnyirt water intrusion monitoring program and a water supply manage-ment program to ensure the continued cost effective use of ex.
The Commission's electric system is currently one cf twenty-eight isting facilities, individual municipal electric systems within the state which are members of the Florida Municipal Power Agency (FMPA). FMPA Raw watet is treated at the Glencoe Plant, which provides com-is a joint action power age- ' which was formed to provide bulk plete water treatment, including aeration, softening, pH adjust-36
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GENERAL UTil.lTIES COMMISSION INFOllMATION Table Vill Septemlict 30,1991 page 3 of 3 UTl!1'11ES COMMISSION, CITY Or NEW SMYRNA BEACil. FLORIDA NEW SMYRNA BEACH, FLCBIDA ment, filtration, fluoridation and disinfection. This facility was vated sluJge process whereby pure oxygen is used for biological expanded from 6.2 MGD to 9.3 M6D in 1991. Since la cumple- stabiliation cf sewage waste. This prcscss was designed to tion in 1977, this plant has received numerous top honors froin provide more than three times the previous treatmen' capacity
'he Florida Department of trwironmental Regulation. and produce letter quality effluent, with fewer plant additions and lower capital investment than a more conventional process The storage, transmission and distribution systeza includes 6.62 would require.
mullon ;allons of storage capacity, three pumping stations, and approximately 110 miles of transmitsion ?.ines. The collection system includes approximately 92 mues of asso.
ciated gravity sewers and force mains. There are presently more TOliv770.V COMROZ SJS72:1/ than 57 wastewater lift stations in service, all of which have radio signal activated SCADA units.
The present service area of the Commission's pollution control system includes approximately 41.3 square nules, including 17.8 In the past few years substantial improvements have been made sguare mues located within the City limits. Major systera facil. in order to expand availability of service, improve operation and ities include the pollution Control plant and the collection sys. curb infiltration and inflow sources. A major ecllection system ed tem. tension into the unincorporeted south beaciu.ide area was comp-leted in 1934 to replace package treatment plants used by con-The pollution Control pir.nt, located on the North Causeway, veas dominiums aleng the south beach, originally constructed n '1964 as a 1.2 mulion gallon per day (MGDJ plant. In 1981, the plant was expanded to a capacity ot Recent construction to provide further treatment required for re.
4.0 MGD. The expande !acility utilizes the oxygenation acti. use and land applicatior' of wastewater et' fluent has commenced.
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l COMPARATIVE BALANCE SilEETS j September 30, UTILITIES COMMISSION, CITY OF NEW SMYRNA BEACH, FLORIDA NEW SMYRNA BEACH, FLORIDA ASSETS 1991 1990 1989 1939 __,J9L Utility Plant Electric system . . . - . . $44,096S16 $42,448,4 B6 $39,229.967 $38,103.157 $37,203,666 Water system . 16.164.983 15.990,608 14,771,713 14,325,6S7 13,397,752 Pollution Control system .. . . 18,022,914 17,878,551 16,995,713 16,874.018 16.472,673 General Plant . . . . .. . . . . . .
5.ZQ339!6 _5.029&S1 3.Zh2.002 _L4B1925 _1321.741 83,988,711 81,347,326 75,759,462 73,784,887 ~1,4 05,792 less: Allow mce for depreciation and amortizatien , C2100.ZZ9J CZ.321.222) (25.29114Z1 CJJ29A9f.>3 I20.9.19ASal 54,187,932 53,955,593 50,465,315 50,645.391 50,456,704 Construction work in progress . .. . . . . . _7J20d52 210ZdZ2 _2JM.2fz1 1.329.502 ._.1 & 92.240 Utility plant, net .. . . .. 61&$1121 56.463.0M 14.251026 .51.934S23 .52.143.910 Restricted Anets Debt Service funds . . . . . . , .. 6,973.725 6,793,117 5,067,859 5,140,544 4,974,756 Renewal and Replacement funds . 6,876,848 11,804,801 0 0 0 Customers' deptai ls . ........... . . . . . 923,181 952,693 907,953 871,457 887,156 CR 3 decommissionmg fund . 602.467 480,849 362.117 251,605 153,003 Rate stabilization fund .... . .. . 45.n11 67.525 ._ 20.516 . 16.023 0 Total restriued assets .. . .12.323.000 ?4.021 717 .10,105.215 .10,250.424 2.fl02.592 Current assets Cash ..- . . . . . . . . . . . 626,784 344,113 521,953 395,745 653,260 Accrued interest recchable . . . . . . . . . . - . . .. .. .. 77,407 65,227 56,420 53,607 47,334 Accounts receivable (ne0 ..... . ., 1,198,213 1,549,934 1,553,631 1,223,125 1,209,442 Unbilled accounts recel,able . .. 2,221,882 1,972,600 1 490,395 1,598,744 1,969,057 Due from other governments . . . . 0 1,007 30,772 70,970 48.893 Inventories . ___
. . . . . . . . 1,615,217 1,423,786 1,467,463 1,438,728 1,297,140 Prepaid expenses and other assets . .. . 217,991 159,007 121,889 140,228 150,701 Assessments receivat'le . . 97.079 74.402 03,454 89.811 102.639 Total current assets ... . . . . . 6.054.573 .5199.226 _5.305,977 _ 5.010.91S _5dZfL4M Deferred Charges and Other Assets Unamortized debt expense . . . 751,243 793,544 550,807 590.875 631,730 Deferred charges ar d other assets . . . . . . . 15,078 18,234 23,543 110,213 25,*/56 Assessments recchable . noncurrent . 0 53,9.12 _J15/ip2 152,035 _._212 141 Total deferred charges and other assets . . . 766.321 820.625 690.042 _ EGO.123 875 022 Total assets . .. . . . - . . . $37,852,285 $86,945,754 $70,453,840 $68,606.503 $68,105,033 38
Table IX LIABILITIES AND UTILITY EQUITY
,, 1991 1990 __1919 _ 1913 _ _. 1992_ _
Utility Equity Contnbuted capital .. . . . . $20,460,198 $19,644,604 $18,540,201 $17,672,840 $16,978,706 Retained Earnings:
Reserved for debt service ... . .. 3,565.636 3,632.700 2.675.541 2,728,142 4,821,153 Unreserved . .. . . . . . . . . . .. _ 1583.225 _3.122 242 A622.935 4.182.122 _ 2.900.595 2.119.3fzl 6.810.032 7.373.475 7.310 269 7.727.748 Total utility equity . . .. . . . . 22409.519. _20A31616 .25.013.677 24.993 109 .24400314 Long Term Debt Note payable (net of cunent portion) . . 2,805,000 2,865,000 1,726,744 745,561 0 Revenue certificates payable (net of cunent portion) . . . 49,185,000 50,265.000 36.285,000 37,090,000 37.655.000 Less: Unamortized debt discount . . .. . f796.60M f B401051_.If,d94021 (740.90M (7913101 Totallong-term debt .. .. . . . . . . .51,193.394 .52.233.393 .'.l.222.142 .3102A.595 .32,05145D Restricted Fund Liabilities Revenue certificates payable (current portion) 1,625.000 1,375.000 1,145,000 1,085,000 940,000 Notes payable (current portion) ... . . 60,000 60,000 45,000 30.000 0 Accrue! interest payable ..... . 1.768,700 1,792,922 1,292,834 1,313,426 1,329,808 Accounts payable . 393.999 3:2,295 697.404 65,290 296.235 Customers' deposits .. . . 907,571 912,064 849,963 778.677 785,872 Deferred credits:
Reserve for decommissioning costs . . . . .. . 602,467 430,849 362,117 251,605 153,603 Rescree for arbitrage rebate 121.244 94.223 0 0 0 Total testricted fund liabuities . . , _ . . . . _5.54ESS1 5.027,353 _d.392.3.13 _2.522.22.S 3.50s.521 Current Liabilities Accounts payable . . . . . .. . 1,641,257 1,675,863 1,443,706 1,557,946 1,481,512 Accrued liabilities . . .
800.985 623,669 544,468 569,701 689,301 Due to other governments . . . 410.403 4 u.3.333 ?ll.?Sb ___34332D . T'4 5.12 Total ci.rrent liabilities . .
_.1B5215f1 2.704.885 J.220.130 _ 2 3 21.262 _2A2133D Other Noncurrent Liabilities Deferred compensated absences . 480,794 474,456 490,315 403.186 329,214 Defened credits operating reserves 166,907 1,020 115,256 45,303 106.864 other liavilities . .. . . . 0 0 0 85.045 _ _ . . O Total other noncurrent liabilities . . .
6A2.7_Q1 _ 3I5dZn __._605.523 . 533.524 436.078 Totalliabilities . .
40.242.226 _60A01.10S A4.530.161 A3423.22A 33J98.572 Total liabilities and utility equity . . . $S7,852,285 $86.945,754 $70,453.840 $6!3,606,503 $68,105.033 39 ak
44 STATEMENTS OF REVENUES, EXPENSES AND Cl!ANGES IN RETAINED EARNINGS Table X 5eptember 30, UDI. IDES COMMISSION, CITY OF NEW SMYRNA BEACH. FLORIDA NEW SMYRNA BEACII, FLORIDA 1991 ... . 19o0 _ 1232 ,_. _J9A R __1932_
Opemting Revenue Saes.....~....~...................r ... . . . $29,815 850 $27,833,668 $26,155,53 $24,180,899 $22,234,268 Oti er revenue ...-. . ..... ... ., . . .. . 297.408 278.545 261.073 __2ftLB5h .. 237,666 Total operating revene ... ... .. . . . ..... - .. ... 30.113.258 2B 112.213 .26.41' "e/ .24.442.765 ,22321.924 Operating Expenses Production expenses . .... .. -- 15,718,072 14,971,670 13.903,532 12,780.038 11,962,054 Transmission, distribution and sewage collection and treatment .... ... . .. . . . .. .. .~... ... ... .. . .. . .- . .. 2,989,885 2.856,957 2,795,429 2.657,153 2,430,767 Customer accounting . .... . . . . . . . . . . . ................. 750.567 721,935 6M,210 647,001 614,138 Administrative and general .-- . - . . . . . 3,856,593 3,541.852 3.025,338 2,8b8,994 2,856,752
' Required payments to the City of New Smyrna Beach .. .. 1,785,889 1,781,241 1,589,082 1,481,102 1,301,571 State utilities tax . -- . . . . . . . . . . . . . . . . . . . . . . . 3,293 321,159 308.843 291,187 243,184 Deprecia tion ......... .., . .. .... ..... .... . . . . . . . . . . . 2.616.987 2.447.5.65 .,,.2.212.231 2 119.622 .. 1.8 B5.182 Total operating expenses ..-... . ..
lz.22L26.6 .26.642.322 .24A2.4 62fi .22.B55.150 21.29314S-Operating income .. . . .. ... .. . .. . 2.391.972 1A69,834 L92L922 1 *j77.615 1.178.096-Nonoperating Revenue Interest earnings . . . . . . . . . == 696,413 801,086 818.148 668,355 665,119 Other income .. . ........ .. . . . . . . . . . 178,878 189,772 190,580 152,062 148.241 Gain on disposal of fixed assets . . . . 1M29 _0 6.322 ._ _._6.421 2B2.2L2 Total nonoperating revenue . ... . ... ... . . . ., . 876,320 990.853 1.015.101 826 833 _.L103.222
'!otal income ... ...... . .~. 3.268.292 2.460.692 ._2.937,033 2.401 A52 2.281.408 Nonoperating Expenses Interest and debt expense . . . . . . 2,840.79S 2,781.553 2,737,217 2,775,470 2,583,191 Other expenses ..~...-- - . - 5,238 108,507 83.773 37,730 101,482 Lces on disposal of fixed assets 82.937 124.066 52,335 p.222 34.3.ft9.
Total nonoperating expenses . . . . .. . . . 2.923,.923 3.024.126 2.823.826 ._2.82L922 _2.219.032.
Net income (loss) before extraordinary items ......... 339,319 (563.434) 63,207 (417,479) (437,634)
Extraordinary item Loss from defeasance c' debt '. . . . . . . . . . . . . . . . . ... O_ 0 0 0 _L235.535.
Net income (loss) .
. . . . . . . . . 339,319 (563,434) 63,207 (417,479) (1,823,179)
Retained earnings, beginning of year z.... . ... . . . . 6.810.042 7.373.476 7.310,269 7.727.vaa 9.55.0.927 Retained earnings, end of year . ... . $ 7,149,361 $ 6,810,042. $ 7,373,476 $ 7,310.269 $ 7,727,748 40 a .... .- .
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STA17.MENTS OF CASil F1.OWS Table X1 September 30, U11LITIES COMMISSION, CITY OF NEW SMYRNA BEACH, FLORIDA NEW SMYRNA BEACil, FLORIDA 1991 . 1999 _ 1999 19S.S_ _ 1997 Cash Flows From Operating Activities Cash received from customen .. . .. .. . $30,373,425 $27,764.497 $26,420.593 $24,BSO,642 $22,031,044 Cash paid to suppliers - _.- ., , (19,569,407) (19,091,380) (17,136.023) (16.584.464) t696,300)
Cash paid to employees for services . . (5,330,617) (4,908,802) (4,489,871) (4,347,814) (4,001,121)
Net cash provided by operating activities . . . 5.473,401 3,764,300 4,795,699 3,948,364 3,384,423 Cash Flows From Noncapital Financing Acthities Cash recched from nonoperat'.ig sources . .. 178,878 189,771 190,581 152,062 148,241 Cash paid for nonoperating expenses . .. (5,238) (108,507) (83,773) (37,730) (101,482)
Net cash provided by noncapital financing activities . 173,640 81,264 106,808 114,332 46,759 Cash Flows From Capit al and Related Financing Activities Net proceeds from issuance of long term debt 0 15,719,090 1,026,182 775,562 14,329,128 Debt reductior. outlays ... . . .. . (890,000) (850,000) (775,000) (620,000) (8,804,557)
Contributed capital ...... ., . . . . , .~... . .
815.594 1,104,404 867.360 794,134 1,270,785 Proceeds from sale of property r,nd nmipraent .. , 5,750 363 17,969 9,255 333,985 Acquisition and corutruction of capiuo as ets = , (7.952,966) (4,686.529) (4,706,497) (2,094,748) (9,773,409)
Interest paid (net of amount capita!ized) .. .. ,. . (2,772,719) (2,187,040) (2,666,377) (2,698,611) (2.332,546)
Net cash provided by (used b) capital and related Gnancing activities : . (10,794,341) 9,100,289 (6,236,363) (3,834,408) (4,976.614)
Cash Flows Favm Investing Acthities Purchase of investment securities . , ,
(4,017,835) (6,016,589) (4.829.867) (4,151,042) (1,797,166)
Proceeds from sale cf investment securities . . . 7,673,775 4,325,177 4,610,600 3,907,824 1,353,804 Interest recchted . . . . . . . . . . 781,254 792,279 815,335 662.031 665,200 Net cash provided by (used in) investing actnaties . . 4,437,194 (899,133) 596,068 415,863 22L838 Net increase (decrease) in cash and cash equivalents (710,106) 12,046,719 (737,788) 644,151 (1,323,594)
Cash and cash equivalents, beginning of year . . 19,396,090 7,349,371 8.087,159 7,443,003 8,766,602 Cash and cash equh*alents, end of year .. . . $18,685,984 $19,396,090 $ 7,349,371 $ 8,087,159 $ 7,443,008 Reconcilation of Operating inceme to Net Cash Provided By Operating Aethities Operating inecme (loss) . . . . . . . . . . . - . . . . $ 2,391,972 $ 1,469,83 4 $ 1,921,932 $ 1,577,615 $ 1,178,0S6 Adjustmen's to reconcile net income (loss) to net cash provided by operating aethities:
Depreciatic 1, amortization and decommissioning . . 2,791,601 2,559,G41 2,385,398 2,345,883 2,080,116 Provish.n for losses on re eivables 59,000 61,237 54,541 55,327 41,015 Decrease (increase) in operating assets:
Accounts receivabic ..... . . . . ... 44,646 (510,181) (262,857) 279,226 (915,539)
Assessments receivable .. .. . .. 36,240 (10,947) 26,357 71.284 102,771 Invencories .. ... (191,431) 43,677 (28,735) (141,587) (24,662)
Prepaid etperses . ............. ..... . . (58,984) (37,118) 18,340 10,472 (41,138)
Deferred charge. and other assets ., . . . 3,156 62,084 156,422 (84,459) (651)
Increase (decrease) in operating liabilities:
Accounts payable . . . . 47,098 (152,952) 517,874 (154.513) 459,710 Due to other governn ents . . . . . . 5,055 173,398 (111,665) 19,103 163,084 Customer deposits . (4,493) 62,100 71,286 (7.195) 135,346 Other liabihties : .
342.5M 4U2Z 464 % r22.79D _2DfA2S5 Net cash provided by operating activities . $ 5,473,401 $ 3,764,300 $ 4,795,699 $ 3,948,364 $ 3,384,423 41
a, SELECTED SEGMENT INFORMATION Thble Xll September 30, UDLIBES COMM!Ss!ON, CIW OF NEW ShWRNA BEACll, FLORIDA NEW ShWRNA BEACll, FLORIDA Elwtric N ter
) ollution Control E
M
._.lpicm_ _5ntem 3pirml__ __ hiaL_
September 30, 1991:
Operating revenue ... . . . . . . , . . . . $24.261,715 $ 3,414,240 $ 2,437.303 $30.113,258 Depreciation and decommissioning .. . , . . . .. . ... . , 1,573,671 457,665 585.651 2,616.987 Operating income (loss) . . . . . . . . . . . , . . . . . . .. . . .. 2,118,404 560,117 (286,549) 2,391,972 Required payments to City of New Smyrna Beach . . . . . . . . . 1,440.022 201,595 144,272 1,785,889 Net income (loss) ......_ ___... , .. 772,158 119,221 (552.060) 339.319 Contributions in aid of construction . . . . . . . . . . . .. . 418,729 7,119,945 12,921,524 20,460.198 Utility plant acquisitions . , , . . . . . . . . .. , 2,326.451 360,470 303.059 2,989,980 Utility plant retirements ....... . . ., .. . . .. ... . 273.4S9 17,540 57,565 348,594 Revenue Certificates pcyable . . .. .. . 24,046.600 19,810,500 0,952,900 50,810,000 Utility equity . . .. . . , 6,808,665 9,E83,957 10.916,937 27,609,559 September 30, 1990:
Operating revenue .. . . . . . . . . . $22.362,293 S'.,,305.107 $ 2,444.813 $28,112.213 Depteciation and decommissioning . . . . . . 1,468,516 426,844 552,205 2,447,565 Operating income (los0 . ....- . - . . . .. . . . 1,057,782 554,618 (142.566) 1,469,834 Required payments to City of New Smyrna Beach . . ., , . . . . . . 1,387,110 228,692 165,439 1,781,241 Net income (loss)......- ... . . . (373,432) 149,131 (339,133) (563,434)
Contributions in aid of construction . .. 413.178 6.646.402 12,585,024 19,64%,604 Utility plant acquisitions . .. 3,793,896 1,318,638 953,284 6,065,818 Utility p' ant retirements ........ . . . 414,809 32.841 30,304 477,954 Revenue Certificates payable . . . . 24,488,100 20,053,050 7,098.850 51,640,000 Utility equity . . . . . . . 6,030,956 9.291,193 11,132,497 26,454,646 September 30, 1989:
q Operating revenue .. . . _ . . , $20,841,500 $ 3,184,987 $ 2.390,120 $26,416,607
- Depreciation and deco'nmissioning . .. . .. . . . 1,388,401 396,269 538,083 2,322,753 Operating income (loss) . . . . . . . . . . . . . . . . . _ . . .. ., 1,201,721 676.188 44,023 1,921,932 Required payments to City of New Smyrna Beach . . . 1,256,840 189,685 142,557 1,589,082 Net income (loss) . . .. .. . . . , (80,411) 261,767 (118,149) 63,207 Contnbutions in eid of construction .. . . 410,273 5,196.160 12,933,768 18,540,201 Utility plant acquisitions . . . . . . . . . 1,438,980 547,037 173,227 2,159,244 Utility plant retirements ........ . ., . 142.218 32,203 10,247 184,668 Revenue Certificates payable , , . 21,055,700 10,082,700 6,291,600 37,430,000 Utility equity . . . .. 6,401 A 83 7,691,820 11,820,374 25,913,677 September 30, 1988:
Operating revenue .. . .. . , , . $19,467,476 $ 3,050,904 5 1,924,385 $24,442,765 Depreciation and decommissioning . . . 1,323,254 367,515 527,554 2,218,323 Operating income (loss) . . . . . . . . . . . - . . . . . . . . . . . . . 1,240,917 661,896 (325,198) 1,577,615 Required paytnents to City of New Stayrna Beach . 1,187,019 180,950 113,133 1,481,102 Net income (loss) ......... . , , (51,032) 186,970 (553,417) (417,479)
Contributions in aid of construction . -. 410,273 5,443.804 11,816,763 17,672,840 Utility plant acquisitions . .. 1,023,925 996,032 427,530 2,447,487 Utility plant retirements ..... . . . 34,240 30,516 3,636 68,392 Revenue Certificates payable . , , 21,454,400 10,2 v9,4 50 6,421,150 38,175,000 Utility equity . . .. 6,481,894 7,677,697 10,823,518 24,933,109 September 30, 1987:
Operating revenue .. . . . , .. $17,714.974 $ 2,925,916 $ 1,831,044 $22,471,934 Depreciation and decommissioning . . 1,078,093 337,457 513,702 1,929,252 Operating income (loss) . . . . . . _ _ . . . . . . . . . . . . . . . . . . . .. . .. 883,855 618,625 (324,394) 1,178,086 Required payments to City of New Smyrna Beach . . . 1,020,323 173,449 107,799 1,301,571 Net income (loss) ........ . . . . . . , , (572,267) (566,931) (633,981) (1,823,179)
Contributions in aid of construction .. . . . . 410,904 4,989,643 11,478,159 16,878,706 Utility plant acquisitions . . . 9,712,604 741,641 273,531 10,727,776 Utility plant retirements ........ . . 292,121 13,229 24,223 329,573 Revenue Certificates payable . . . 21,801,167 10.493.805 6,500,028 38.795,000 Utility equity . . . . 6,533,557 7,036,566 11,036,331 24,606.454 42
SCilEDtlLE OF REVENUE CERTiflCATE COVEllAGE Table XIll Septemter 30, U TILITIES COMMISSION, CITY OF NEW SMYRNA BEACll, FLOR!DA NEW SMYRNA BEACH, FLORIDA
_1991 . .__1222 .,.. _19f9 _ _ lpriS_ _. 1932 Gross Revenue Per Certificate Resolution Operating revenues .... . .. . ............. , $30,113,258 $28,112,213 $26,416,607 $24,442,765 $22,471,934 Interest and other income (excluding const uction fund interest earnings) . . .. . 876,320 990,858 1,008,728 820.417 813.360 Connection fees . .. , , . 756,866 1,001,968 606,571 756,976 1,180,590 Assessment collectiorts . . . . , ... M 222 45.82S 69.Z10 . 71.284 101.0!21 Gross revenue per certificate resolution . .
.2LZf2.692 _30.110.B6Z .20.301hh 2L091442 14.MZ.Z75 Expenses Per Certificate Resolution Operating ex]xnses . . . . .. . 27,721,2 B6 26.642,379 24,494,675 22,865,150 21,293,848 1ess: Depreciation expense ....... .... . . (2,495,369) (2,328,833) (2,212.241) (2,119,675) (1,885 362)
Required payments to the City . ..
11.Z85.S32) JLZEll41) 11.39.0S2) 11.411L102) 11J01511)
Experucs per certificate resolution .. . . . . . 22.440.023 .22.532.205 luk23.352 12264JZ2 .18.105.S95 Incoine available for debt service . . . . . . . 8,342.655 7,610,562 7,608,304 6,827.069 6,460,880 Anr.ual Debt Service hequirements Ptincipal . .. ....... . . - . . . . . 1,020.000 805,000 765,000 725.000 515,000 Intert t C as necrued interest) (1) . __.3.HD.922 2.5522B1 _2J22.110 2,022.182 ._2.MO.312 Total annual debt service requirernents . . $ 4,570,972 $ 3,358,281 $ 3,362,110 $ 3,362,382 $ 3,175,317 Coverage ratio (Times) . . . . 1.83 2.27 2.26 2.03 2.03 (1) Interest expense for the fiscal years ended September 30.1990, is stated net of $783,778, in interest expense which was funded from the proceeds of the issuance of $15,000,000 Utilitics Commission, City of New Smyrna Beach, Florida Utilities System Revenue Certificates, Series 1990.
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SCllEDULE Ol' SEl.ECTED FINANCIAL. IIATIOS Table XIV Septemter 30 UTILmES COMMIS510N, CTIY 07 NEW ShWitNA 13EACl!. FLO!UDA NEW SMYitNA 13EACli. FLOIUDA i
__ 1991 1992_ 1999 ._.1911 _., 1097.
Cunent ratio . current assets divided by cunent liabuities . .. . .. . . . . . . . . (Times) 2.12 2.06 2.39 2.00 2.20 Quick ratio cunent assets Icss inventories divided by cunent liabilities ..... (Times) 1.56 1.54 1.73 1A3 1.68 Current assets dMded by total assets . . ... (Percent) 6.89% 6.43% 7.53 % 7.30% 8.04 %
Cunent liabilities dMded by totalliabilities . (Percent) 4.74 % 4.47 % 4.98% 5.73 % 5.74 %
Current liabilities divided by utility equity . . (Percent) 10.33% 10.22 % 8.57 % 10.01 % 10.14 %
Contributed capital dMded by utility equity.. (Percent) 74.11 % 74.26 % 71.55 % 70.74 % 63 59 %
Total liabuities divided by utility equity . . (Times) 2.18 2.29 1.72 1.75 1.77 Long tenn debt (net) divided by utility equity (Times) 1.85 1.98 1A4 1A8 1.51 Cunent !! abilities dMded by total anets .. (Percent) 3.25% 3.11% 3.15 % 3.65% 3,60%
3 Long tenn debt (net) divi' led by total assets . (Percent) 58.27 % 60.13 % 52.97 % 54.07 % 54A2%
Totalliabilities dMded by total assets . (Percent) 68.57 % 69.57 % 63.22 % 63.58 % 63.07%
Sales dMded by average accounts receivable . (Times) 22.04 18.22 19.03 20.10 21.12 Average collection period average billed accounts receivable dMded by average daily sales . . . . ... (Days) 16.33 19.87 18.92 17.91 17bt
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i I CITY OF BUSIINELL, FLORIDA I GENERAL PURPOSE FINANCIAL STATEMENTS FOR TIIE FISCAL YEAR ENDED SEITEMBER 30,1991 I
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I CITY OF DUSHNELL, FLORIDA CITY COUNCIL AND OFFICIALD SEPTEMBER 30, 1991 I Mayor-Councilman . . . . . . . . . . . . Joe P. Strickland, Jr.
Vice-Mayor . . .. . . . . . . . . . . . . . . . R. Jerry Eubanks Councilman . . . . . . . . . . . . . . . . . . . . . Dale Swain Councilman . . . . . . . . . . . . . . . . . . . Billy Williams Councilman . . . . . . . . . . . . . . . . . . . . . Emory Guess City Manager . . . . . . . . . . . . . . . . . . . Vicente Ruano City Clerk . . . . . . . . . . . . . . . . . . Judith C. Muller City Attorney . . . . . . . . . . . . . . . . . . . Brian Eubanks
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I CITY OF BUSHNELL, FLORIDA GENERAL PURPOSE FINANCIAL STATENENTS SEPTEMBER 30, 1991 I TABLE OF CONTENTS Eage Number INTRODUCTORY SECTION City Council and Officials i Table of Contents11-111 FINANCIAL SECTION Independent Auditor's Report 1-2 General Purpose Financial Statements:
Combined Balance Sheet--All Fund Types and Account Groups 3-4 Combined Statement of Revenues, Expenditures, and Changes in Fund Balances--All Governmental Fund Types 5 Combined Statement of Revenues, Expenditures, and Changes in Fund Balances--Budget and I Actual--General and Special Revenue Funds 6 Combined Statement of Revenues, Expenses, and I Changes in Retained Earnings--All Proprietary Fund Types 7 Combined Statement of Cash Flows-- All Proprietary Fund Types 8 Notes to Financial Statements 9-23 Combining and Individual Fund Financial Statements:
General Fund Comparative Balance Sheets 24 Comparative Statement of Revenues, Expenditures and Changes in Fund Balance 25 l
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i I Pace Number TABLE OF CONTENTS (Continued)
I Compirativu Statement of Revenues, Expenditures, I and Ch%nges in Fund Balances--Budget and Actual 26-27 I Statement of Revenues-- et and Actual 28-29 Statement of Expenditures- Budget and Actual 30-34 Everareen Cemetery Special Revenue Fund Comparative Balance Sheets 35 Comparative Statements of Revenues, Expenditures, and Changes in Fund Balances 36 Entornrise Fundq Combining Balance Sheet 37-29 Combining Statement of Revenues, Expenses and Changes in Retained Earnings (Deficit) 40 Combining Statement of Cash Flows 41-42 I Aconcy Fu nd.fi Combining Balance Sheet 43 SUPPLEMENTARY INFORMATION Independent Auditor's Report on Supplementary Informatier. - Schedule of State Financial Assistance 44 Schedule of State Financial Assistance 45 I Auditor's Report on Compliance Based on an Audit cf the General Purpose Financial Statements Performed in Accordance with Government Auditing Standards 46 Report on the Internal Control Structure in Accordance with Government Auditing Standards 47-48 Auditor's Letter to Management 49-50 I
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l DAVID C. LOGAN Certified Public Accountant I
January 15, 1992 INDEPENDENT AUQJTOR' S REPORI I Honorable Mayor and Members of the City Council City of Bushnell Bushnell, Florida I have audited the accompanying general purpose financial state-monts of the City of Bushnell, Florida, as of and for the year f" ended September 30, 1991, as listed in the Table of Contents.
These financial statements are the responsibility of the City of Bushnell's management. My responsibility is to express an opinion on those financial statements based on my audit.
Except as discussed in the following paragraph, I conducted my audit in accordance with generally accepted auditing standards.
Those standards require that I plan and perf orm the audit to obtain i reasonable assurance about whether the financial statements are I free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the I accounting principles used and management, as well as evaluating the overall financial statement presentation. I believe that my audit provides a reasonable basis significant estimates made by for my opinion.
I I was unable to examine sufficient evidential matter to determine if property, plant and equipment and the provisions for deprecia-I tion recorded in the Electric Utility Fund and the fixed assets recorded in the general fixed assets account group are fairly presented at cost or estimated historical cost, due to insufficient detail within the City's property records.
In my opinion, except for the effects of such adjustments, if any, as might have been determined to be necessary had I been able to I determine the propriety of amounts recorded as property, plant and equipment and the provisions for depreciation in the Electric Utility Fund and the propriety of amounts recorded as fixed assets I in the general fixed ansets account group, the general purpose financial statements referred to above present fairly in all material respects, the financial position of the City of Bushnell, g Florida, as of September 30, 1991, and the results of its opera-g tions and the changes in financial position of its proprietary fund types for the year then ended, in conformity with generally accepted accounting principles.
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l 3425 Lake Center Drive
- Mount Dora, Florida 32757 * (904) 383-3500
- Fax (904) 383-5441
, I Honorable Mayor and Members of the City Council ;
January 15, 1992 j Page 2 My audit was mado for the purpose of forming an or inion on the I general purpose financial statements taken as a whole.
combining, individual fund, and individual account group financial The ,
statements and schedules listed in the Table of Contents are l presented for purposes of additional analysis and are not a
': required part of the general purpose financial statements of the l City of Bushnell, Florida. Such information has been subjected to I the auditing procedures applied in the audit of the general purpose financial statements and, in my opinion, is fairly stated in all material respects in relation to the general purpose financial statements taken as a whole.
we David C. Logan Certified public Accountant I
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I I GENERAL PURPOSE FINANCIAL STATEMENTS I
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M M M M M - M M M M M M- M M M M M Mm (Page 1 of 2)
. CITY OF LJSHNELL,. FLORIDA CCHBINED BALANCE JIIE2T--ALL FUND TYPES AND ACCOUNT GROUPS SEPT WBER 30, 1991 (WITzl COMPARATIVE TOTALS FOR SEPTEMPER 30, 1990)
GOVERNMENTAL P!:OPRIETARY FIDUCIARY ACCOUNT G30'JPS FUND TYPES WND TYPES FUND TYPES GENERAL GENERAL TOTALS SPECIAL AGENCY FIXED LOJG TERM - ( MEMORANDtH ONLY)
GENERAL REVENUE NTERPRISE FUND ASSETS DEBT 1991 1990 ASSETS ;ND OTHER W 113 Assets:
Cash $ 17(,468 5 3,505 $ 410,105 $ 2,050 S -$ - $ 650,128 $ 545,367 Receivable (Net of allowance for ancollectibles - S6,003):
Interest - - - - - - - 1,476 Taxes 31,614 - - - - - 31,614 31,172 Accounts - -
200,769 - - - 200,769 203,852 Intergovernmantal 2 7, :12', - - - - - 27,126 23,169 Due From Other Funds - - 3,899 - - - 3,839 1,193 Inventories, at cost 905 - 74,396 - - - 75,301 76,114 Prepaid Expenses - -
6,114 - - - 6,114 7,740 Restricted Assets:
g Cash and Investeents -
255,256 399,671 - - -
654,927 614,039 Property and Equipraent, at Cost (Net, where applicable, of accumulated depreciation) - - 2,186,679 - 1,040,221 -
3,226,900 2,951,785 other Assets - -
13,919 - - - 13,919 7,794 Other Debits:
Amount tc be Provided for Retirement of General Lon2- l Term Debt - - - - - 131,328 131,328 137,83.
Total Assets and Other Debits $ 234,113 S 258,761 $ 3,355,552 S 2,050 S 1,0 S 211 $ 131,328 $ 5,022,025 S 4,601,533 I
r See Accompanying Notes to Financial Statemer.ts ,
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CITY OF BUSHNELL,-FLORIDA COMBINED BALANCE SHEET--ALL FUND TYPES AND ACCOUNT GROUPS EPTEMBER 30, 1991 (WICI COMPARATIVE TOTALS FOR SEFTEMBER 30, 1990)
.n GOVERNMENTAL PROPRIETARY FIDUCIARY ACCOUNT GROUPS FUND TYPE 3 FUND TYPES FUND TYPES CENERAL GENERAL TOTALS SPECIAL AGENCY FIXED LONG TERM ( MEMORANDUM CMLY)
CENERAL REVENUE ENTERPRISE FUND ASSETS DEBT 19 3 1890 LIABILITIES, EQUITY AND OTHER CREDITS Liabilities:
Accounts Payable S 98,093 $ - $ 118,190 $ -
S - $ -S 216,283 S 192,500 Accrued Liabilities 6,178 - 4,424 - - - 10,602 9,655 Compensated Absences Payable - - 18,480 - - 34,875 53,335 56.129 Due t.o Other funds - 3,899 - - - 3,899 1,19?
Def erre:i Revenue 2,298 - - - - - 2,298 2,288 Deposits 850 1,200 - 2,050 - -
4.100 4,424 Payable From Restricted Assets:
Customer Deposits - - 57,25-6 - - - 57,256 52,649 Accrued Interest Payable - - 11,133 - - -
11,133 11,498 Revenue Bonds Payable - - 40,000 - - - 40,000 35,000 Long Term Revenus Bonds Payable -
- 257,806 - - 257,806 281,781 series 1976 (Net) - - -
96,453 697,453 Notes Payable - - 601,000 - -
_450.026 Total Liabilities 107,419 1,200 1,112,188 2,050 - D1,328 1,354,185 1,097,143 Equity and Other Credits:
Contributed Capital - - 1,084,703 - - - 1,084,703 1,079,200 Investment in General Fixed Assets - - - - + 221 -
1,040,221 773,657 Retained Earnings:
Reserved - -
272,791 - - - 272,791 274,772 Unreserved - -
885,870 - - -
885,870 850,444 Fund Balances:
Re s e rved 1,655 255,256 - - - - 256,911 242,184 Unreserved 125 039 2,305 - - - - 127,344 284,133 Total Equity end Other credits 116,694 257,561 2,243,364 - 1,C40,221 - 3,667,840 3,504,390 Total Liabilities, Equity and Other Credits $ 234,113 S 250,761 $ 3,355,552 $ 2,050 $ 1,040,221 $ 131,328 $ 5,022,025 $ 4,601,533 Sae Accompanying Notes to Financial Statements
l CITY OF BUSHNELL, FLOR 2DA COMB 8 PED STATSMENT OF REVENUES, EXPENDITURES, AMD l CHANGES IN FUND BALANCES--ALL GOVERNMENTAL FUND TYPES YEARS ENDED SEPTEMBER 30, 1991 (WITH COMPARATIVE TOTALS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 1990)
TOTALS SPECIAL (MEMORANDUM ONLY) 1991 1990 I
GENERAh REVENUK Revenues:
Taxes S 275,487 $ -
S 275,487 S 262,000 Licenses & Permits 24,970 - 24,970 10,883 349,412 349,412 225,179
.I Intergoverrunental -
210 3,210 8,764 charges for Services 3,000 Fines & Forfeits 19,450 - 19,450 23,583 Miscellaneous Revenue 27,022 27,114 54,136 50,820 Total Revenues 696,551 30,114 726,665 581,229 Expenditures:-
General Government 210,592 - 210,592 176,245 Public Safety 369,639 -
369,639 310,674 Physical Environment 2,579 13,757 16,336 14,928 I- . Transportation 149,615 -
149,615 112,755 Economic Environment 11,000 - 11,000 10,931 I Culture & Recreation 290,801 - 290,801 94,889 Debt Service:
Principal 21,174 -
21.174 20,190 Interest 5,311 - 5,311 0,557 Total Expenditures 1,060,711 13,757 1,074,468 750,169 Excess (Defi.iency) of Revenues Over (Under)
Expenditures (364,160) 16,357 (34/,803) (168,940)
Other Financing Sourcos:
-Operating Transfers In 193,673 - 193,673 140,000 Loen Proceeds 12,477_ - 12,477 11,853 I Total Other Financing Sources 206,150 _
- 206,150 151,853 I Excess (Deficiency) of Revenues and Other Financing Sources Over Other Expenditures (158,010) 16,357 (141,653) (17,087)
Fund Balancos October 1 285,113 241,204 526,317 543,448 Increase ' Decrease) in Inventory Reserves (409) -
(409) (44)
Fund Belances September 30 $ 126,694 S 257,561 S 384,255 5 526,317 I
See Accompanying Notes *o Financial Statements
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CITY OF DUSHNELL, FLORIDA COMBINED STATEMENT OF REVENUES, E% PEND 2TURES, AND CHANGES 2N FUND BALANc2S--DUDGET AND ACTUAI, -
GENERI' AND SPECIAL REVEWJE FUNDS YEAR ENDED SEPTEMBER 30, 1991
.I. VARIANCI FAVORP BLE
( UN FAVORABLE,),,
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BUDGETEQ bCTUAL Revenues:
Taxes $ 259,540 5 275,487 $ 15,947 Licenses and Permits 11,315 24,970 13,655 Intergovernmental 362,573 349,412 (13,161)
Charges for Services 700 3,210 2,510 I Fines a.3d Forfeits Miscellan6ous Revenue 19,500 15,750 19,450 54,136 (50) 38,386 Total Revenues 669,378 726,665 57,287 Expendituresa I General Government
-Public Safety Physical Environment 201,689 367,899 3,200 210,5-2 369,639 16,336 (8,903)
(1,740)
(13,136)
I Transportation Economic Environment Culture and Recreation 142,369 11,000 280,318 149,615 11,000 290,801 (7,246)
(10,483)
I Debt Service:
Principal Interest 19,529 10,382 21,174 5,311 (1,645) 5,071 Total Expendit was 1,036,386 1,074,468 (38,082)
Excess (Deficiency) of Rovenues Over (Under) Expenditures , (367,008) ( 34 *' , 803 ) 19,205 Other Financing Sources:
oporating Transfers In 203,673 193,673 (10,000)
Loan Proceeds 12,500 12,477 (23)
Total other Financing Sources 216,173 , 206,150 (10,023)
Excess (Deficiency) of Revenues and Other Financing Sources I- Over Expenditures (150,835) (141,653) 9,182 Fund Balances October 1 526,317 526,317 -
Increase (Decrease) in Inventory -
(409) (409)
Fund Balances September 30 S 375,482 S 384,255 $ 8,773 N-k, See Accompanying Notes to Financial Statements I 6 i I
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CITY OF BUSHNELL, FLORIDA COMBINED STATEMENT OF REVEN0ES, EXPENSES, AND CHANGES IN RETAINED EARNINGS--ALL PROPRIETARY FUND TYPES I- YEAR ENDED SEPTEMBER 30, 1991 (WITH COMPARATIVE TOTALS FCR THE FISCAL YEAR ENDED SEPTEMBER 30, 199G) 1991 1990 Operating Revenues:-
Charges for Services S 1,572,456 S 1,602,408 Operating Expenses:
Purchased Power 76b,990 752,309 Salaries 185,445 165,759 Employee Benefits 79,103 61,615 Professional Services 43,465 39,259 Cperating Surplies 33,242 32,171 Other Current Charges 83,484 68,719 Dcpreciation 101,311 94,517 l
W 41,461 34,722 Landfill State Utility Tax - 20,336 Total Operating Expensos 1,333,501 _
1,269,407 Operating Income 238,955 333,001 Non-Operating Revenue (Expense):
I Interest Earned 35,511 41,090 Gain on Sale of Equipment - 14,500 Interest Expense and Fiscal Chargos (47,348) (52,151)
- Total Non-Operating Revenues (Expense) (11,837) 3,439 Income-Before Transfers 227,118 336,440 Operating Transfers (Out) (193,673) (140,000_)_
Nst Income 33,445 196,440 Retained Earnings, October 1 1,125,216 928,776 I Retained Earnings, September 30 S 1,158,661 S 1,125,216 I
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CITY OF BUSHNELL, FLORIDA COMBINED STATEMENT OF CASH FLOWS ALL PROPRIETARY FUND TYPES FOR THE YEAR ENDED SEPTEMBER 30, 1991
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I Cash Flows From Operating Activities:
Cash Heceived From Customers, including ENTERPRISE Cash Deposits $ 1,604,867 Cash Paid to suppliers. (1,106,964)
Cash Paid to Employees (175,543)
Cash Deposits Returned to Cusiomers (25,245)
Net Cash Proaided By Operating Activities 297,115 Cash Flows From Noncapital Financing Activities:
5,503 I
Capital Con;ributione - Customers Operating Tranefers Out (193,673)
Net Cash Used In Noncapital Financing Activities (188,170)
Cash Flows From Capital and Related Financing Activities:
Loan Proceeds 263,644 I- Purchase of Property and Equipment Principal Payments (109,862)
(32,852)
Interest Paid (47,482)
Net Cash Provided By Capital and Related Financing Activities 73,448 Cach Flows From Investing Activities:
Receipt of Interest 35,511 Net Cash Provided By Investing Activities 35,511 Net Increase In Cash 217,904 Cash, October 1 651,872 Cash, beptember 30 $, 869,776 Reconciliation of Operating Income to Net l Cash-Providcd By Operating Activities l
Operating Income $ 238,955 Adjustments to Reconcile operating Income to Net Cash Provided By Operating Activities:
Depreciation Expense 101,311 I Decrease in Accounts Receivable 2,559 Increase in Allowance for Uncollected Accounts 2,000 l
i Decrease in Prepaid Expenses 1,626 Decrease in Inventory 404 (Decrease) in Accounts Payable (50,543)
' Increase in Accrued Expences 1,162 (Decrease) in Accumulated Compensated Absenses (4,966)
Net Increase in Customer Deposits 4,607 Total Adjustments 58,160 Not Cash Provided by Operating Activities $ 297,116
< See Accompanying Notes to Financial Statements 8
CITY OF BUSIINELL, FLOR 8DA NOTES TO FSNANCIAL STATEMENTS SEPTEMBER 30, 1991 NOTE 1
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES The city of Bushnell, Florida was incorporated in 1957. The City operates under a council-manager form of government and provides services to its residents in many areas, including public safety (police and fire), highways and streets, utilities, sanitation, culture-recreation, public improvements, and general administrative services.
The financial statements of the City of Bushnell, Florida have been prepared in conformity with generally accepted accounting principles (GAAP) as applied to governmental units. The Governmental Acccunting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting princi-The more significant of the City of Bushnell, Florida's I
ples.
accounting principles are described below:
A. Reporting Entity In evaluating how to define the government, for financial reporting purposes, management has considered all potential component units The decision to include a potential component unit in the reporting ,
entity was made by applying the criteria set forth in GAAP. The basic--but not the only--criterion for including a potential component unit within the reporting entity is the governing body's ability to exercise oversight responsibility. The most significant manifestation of this ability is financial independence. Other manifestations of the ability to exercise oversight responsibility .
include r but are not limited to, the selection of governing <
authority, the designation of management, the ability to signifi-cantly influence werations, and accounte.bility for fiscal matters.
A second criterion used in evale. ting potential component units is the scope of public service. Application of this criterion involves considering whether the activity benefits the government and/or its citizens, or whether the activity is conducted within I the geographic boundaries of the government and is generally available to its citizens. A third criterion used to evaluate potential component units for inclusion or exclusion from the reporting entity la the existence of special financing relation-ships, regardless of whether the government is able to exercise
.versight responsibilities. Based upon the application Jf these criteria, the following is a brief review of each potential component ur.it addressed in defining the government's reporting entity.
Included within the reporting entity:
Everareen Cemeterv Fund:
A Board of Trusteer is appointed by the City Council to administer the af f airs of Evergreen Cemetery. The Board is authorized to sell canetery lots and to invest proceeds which I are legally restricted by ordinance. The principal is not subject to expenditure and the interest can be used only for operations, me intem.nce snd improvement of the cemetery.
B. Fund Ar: counting The City uses funds and account groups to report on its financial position and the results of its operations. Fund accounting is I designed to demonstrate legal compliance and to aid financial management by segregating transactions related to certain govern-ment functions or activities.
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CITY OF OUSENELL, FLORIDA NOTES TO FINANCIAL STATEMENTS ,
SEPTEMBER 30, 1991 NOTE 1
SUMMARY
O', SIGNIFICANT ACCOUNTING POLICIES (Continued)
A fund.is a separate accounting entity with a self-balancing set of accounts. Funds are classified into three categories:
governmental, proprietary and fiduciary. Each category, in turn, is divided into separate " fund types".
Governmental Funds are used to account for all or most of a government's general activities.
Governmental funds of the City are as follrws:
.I General Fund - The General Fund is the general opera' ' ng f und of the City. It is used to account for all rinancial g- resources, except those required +o be accounted for in g another fuad.
Special Revenue Fund - The Special Revenue Fund is used to account for the proceeds of specific revenue sources (other I than expendable trusts, or for major capital projects) that are legally restricted to expenditures for specific purposes.
Proprietary funds are used to account for activities similar to those found in private sector, where the determination of net income is necessary or useful to sound financial administration.
Goods on, services from such activities can be provided either to outside parties (enterprise funds) or to other departments or I agenciso primarily within the government (internal service funds) .
Fiduciary funds are used to account for assets held on behalf of outside parties, including other governments, or on behalf of other I funds within the government. Agency funds generally are usod to account for assets that the government holds on behalf of others as theit: agent.
An account group, unlike a fund, is a financial reporting device designed to provide accountability for certain assets and liabili-ties that are not recorded in the funds because they do not directly affect net expendable available financial resources.
I Account Groups maintained by the City are as follows:
General Fixed Assets - Accounts for property and equipment not used in proprietary fund operations or accounted for in trust funds.
General Long-Term Debt - Accounts for unmatured principal of leng- term general obligation it.debtedness that is not a specific liability of a Proprietary or Fiduciary Fund.
C. Basis of Accounting I The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. All govarnmental f unds are accounted for using a current financial resourceu measurement I focus. With this measuremer.t focus, only current assets and current liabilities generally are lacluded on the balance sheet.
Operating statements of these funde present increases (i.e.,
revenues and other finaneir.g sources) and decreases (i.e. , expenses I and other financial uses) in net current assets.
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CITY OF BUSENELL, FLORIDA NOTES TO FINANCIAL STATEMENTS SEPTENBER.30, 1991 I NOTE 1
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
All proprietary funds are accounted for on a flow of economic resources measuremnt focus. With this measurement focus, all assets and all liabilities associated with the operation of these funds are included on the balance sheet. Fund equity (i.e., net total assets) is segregated into contributed capital and retained earnings components. Proprietary fund-type operating statemen*.s present increases (e.g., revenues) and decreases (e.g., expenses) in net total assets.
The modified accrual basis of accounting is used by all govern-mental fund types and agency funds. Under the modified accrual basis of accounting, revenues are recognized whan susceptible to accrual (i.e., when they become both measurable and available).
I " Measurable" means the amount of the trannaction can be determined and "available" means collectible within the current period or soon enough thereaf ter to be used to pay liabilities of the current Billing cycles of the proprietary funds which overlap I
peried.
September 30 are prurated based upon meter reading dates.
Expenditures are recorded when the related fund liability i Principal and interest on general long-term debt are I
incurred.
recorded as fund liabilities when due.
The folleving revenues are considered to be susceptible to accrual:
Cignette Tax State tevenue Shtring Proceeds Mobile Home License Tax Alcoholic Beverage Licence Tax Half Cent Sales Tax Property Taxes Franchise Taxes Utility Service Taxes I Interest Revenue The accrual basis of accounting is utilized by proprietary fund types. Under this method, revenues are recorded when earned and
-I expenses are recorded at the time liabilities are incurred.
The City reports deferred revenue on its combined balance sheet.
Deferred revenues arise when a potential revenue does not meet both I the " measurable" and "available" criteria for recognition in the current period. Deferred revenues also arise when resources are received by the government before it has a legal claim to them, as when grant monies are received prior to the incurrence of qualify-In subsequent periods, when both revenue l-I I- ing expenditures.
recognition criteria are met, or when the govecnment has a legal claim to the resources, the liability for deferred revenue is
!- removed f rom the combined balance sheet and revenue is recognized.
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D. Budgets Budgets are adopted on a basis consistent with generally accepted I accounting principles, except that the provision for depreciation expense is not included in the budget of the proprietary funds.
Annual appropriated budgets are adopted for the general fund.
Annual appropriations lapse at fiscal year end.
- Encumbrance accounting, under which purchase orders, contracts, and other commitments are recorded as expenditures in order to reserve that portion of the applicable appropriation is not employed by the I City for budgetary purposes.
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CITY OF CUSENELL, PLORIDA NOTES TO FINANCIAL STATEMENT 4 SEPTEMBER 30, 1991 NOTE 1
SUMMARY
OF 3IGNIFICANT ACCOUNTING POLICIES (Continued)
I E. Cash and Investments Cash includes amounts in demand deposits as wull as short-term investments with a maturity date within three months of the date acquired by the government.
F. Short-Term Interfund Receivables /Payables I During the course of operations, numerous transact ions occur between individual funds for goods provided or services rendered.
Tnese receivables and payables are classified as "due to/from other funds" on the balance sheet.
G. Inventory Inventories held by the Enterprise Funds are stated at cost or market, whichever is lower.
H. Prepaid Items I I.
Payments made to vendors for service that will benefit periods beyond September 30, 1991 are recorded as prepaid items.
Property, Plant and Equipment Property, plant and equipment used in governmental fund type operations are accounted for in the General Fixed Assets Account Group, rather than in governmental funds. No depreciation has been provided on such property, plant and equipment.
All property, plant and equipment are valued at historical cost or estimated historical cost if actual historical cost is not L -
available. Donated property, plant and equipment are valued at their estimated faar value on the date donated.
The city % a adopted the accounting policy of not capitalizing "infrastracture" general fixed at: sets (road, bridges, curbs and I -gutter, stroets and sidewalks, drainage system, lighting systems and atmilar assets that are immovable and of value only to the City).
Depreciation is provided in the enterprise fund in amounts su f ficier.t to relate the cost of the depreciable assets to operations over their estimated sarvice lives on the straight-line basis. The service lives by type of asset are as follows:
Useful Life IIL Years I
Electric Utility Fund Distribution Plant 25-40 years Structures and Improvements 32 years Equipment 6-12 years I
Investment in Crystal River #3 Nuclear Plant 28 years I Water Utility Fund g Distribution Plant 25-101 years S"i di"9 5 va^r" E Equipment 25 years l-l- Sanitation Fund Eqaipment 7 years
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CITY OF EUSENE11, FLORIDA NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1991 I NOTE 1
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
J. Bond Discounts / Issuance Costs Bond discounts and issuance costs for proprietary fund types are daferred and amortized over the term of the bonds using a straight-line amortization method which produce results not significantly different from the interest method. Bond discounts are presented as a reduction of the f ace amount of bonds payable whereas issuance costs are recorded as deferred charges.
K. Compensated Abscuces vested or accumulated vacation leave that in expected to be I liquidated wita expendable available financial resources is reported as an expenditure and a fund liability of the governmental fund that will pay it. Amounts of vested er accumulated vacation leave -that are not expected to be liquidated with expendable available financial resources are reported in the general long-term debt account group. No expenditure is reported for these amounts.
Vested or accumulated vacation leave of proprietary funds is recorded as an expense and liability of those funds as the benefits accrue to employees. In accordance with the provisions of Statement of Financial Accounting Standards No. 43, accounting for compen-sated absences, no liability is recorded for nonvesting accumulat-ino rights to receive said pay benefits. However, a liability is recognized for that portion of accumulating said leave benefits that it is estimated will be taken as " terminal leave" prior to retirement.
I L. Interfund Transactions Quasi-external transactions are accounted for as revenues, expenditures or expenses. Transactions uct constitute reimburse-I ments to a fand for expenditures / expenses initially made from it that are properly applicable to another fund, are recorded as expenditures / expenses in the reimbursing fund and as reductions of expenditures / expenses in the fund that is reimbursed.
All ota.or interfund transactions, except quasi-external transac-tions and reimbursements, are reported as transfers. Nonrecurring or nonroutine permanent tracafers of equity are reported as i
residua? oquity transfers. All other interfund transfers are reporwed as operating transfers.
M. Grants - Proprietary Funds Unrestricted grants, entitlements or shared revenues received are reported as non-operating revenues, such resources externally restricted for capital acquisitionc or construction are reported I as contrihated capital Operating expenses include depreciation on all depreciable fixed assets (ir.cluding those financed by grants).
I N. Water Line Extension Charges l
Water line extension charges are made to customers to cover the full cost of the addition. Such charges are recorded as an equity l
contribution. Coste of the extension are reported as property and
- equipmont and depreciated over the estimated useful life of the asset.
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CITY OF BUSENEI&, FLORIDA NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1991 NOTE 1
SUMMARY
OF STONIFICANT ACCOUNTING POLICIES (Continued)
O. Fund Equity Contributed capital is recorded in proprietary funds that have received capital grants or contributions from developera, customers I or other furade. Reserves represent those portions of fund equity not appropriable for expenditures or legal)y segregated for a specific future use.
P. Total Columns .a Combined Statements--Overview Total columns on the combined statements - overview are captioned Hemorandum Only to indicate they are presented only to facilitate financial analysis. Data in these columns arn not comparable to a consolidation. Interfund transactions are not eliminated.
Q. Comparative Data Comparative total data for the prior year have been prewented in the accompanying financial statements in order to provide an understanding of changes in the government's financial position and I operations. However, comparative data have not been presented in all statements because their inclusion would make curtain state-ments unduly complex and difficult to understand.
NOTE 2 LEGAL COMPLIANCE - BUDGETS Prior to October 1, the City Manager submits to the City Council a I proposed cperating budget for the fiscal year commencin] October 1. The operating budget includes proposed expenditures and the means of fAnancing them. After submission of the proposed operating budget, workshops are held and public hearings are conducted to obtain taxpayer
.l comments. Prior to October 1, the budget is legally enacted through 3 passage of a resolution. Any transfers of budgeted amounts oetween departments within any fund and any revisions that alter the total expenditures of any fund must be approved by the Council.
Budgeted amounts presented agree with the original adopted budget as amended during the year by City Council.
A formal budget is not adopted for the Evergreen Cemetery Fund.
i NOTE 3 DEPOSITS AND INTiESTMENTS
,- Deposits - At year end, the carrying amount of the City's deposits was
$1,198,017 and the bank balance was S1,207,531. All of the bank balance was covered by federal depository insurance or by a state collater.1 I insurance pool held by the Treasurer, State of Flrrida, in the Public Deposit Security Trust Fund established in accordance with Chapter 230 of the Florida Statutes.
l Investments - The City's investments are categorized as either (1)
[ g insured or registerud or for which the securities are held by the City l or its agent in the City's name, (2) uninsured and unregistered for which the securities are held by the broker's or dealer's trust l
eepartment or agent in the City s name,
( gE
- or (3) uninsured and unrogistered for which the securities are held by the broker or dealer, or by its trust department or agent but not in the government's name.
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1 CITY OF BUSEMELL, FLORIDA I NOTES TO FINANCIAL STATEMENTS I SEPTEMBER 30, 1991 )
NOTE 3 DEPOSITS AND INVESTMENTS (Continued)
Catecories Carrying Market 1 2 3 Amount _ Value U.S. Government Securities S - 5107,038 5 - $107,038 5107,631 I-NOTE 4 RECEIVABLES Receivables at September 30, 1991 consist of the following:
General Enterprise Total I
Receivables:
Taxes $31,614 S
- S 31,614 Accourts - 208,769 208,769 Intergovernmental 27,126 - 27,126 Gross Receivables 58,740 208,769 267,509 Less - Allowances ior Uncollectibles -
(8,000) (8,000)
Net Receivables $58,740 $200,79, SM Under Florida law, the assessment of all properties and the collection of all county, municipal and school board property taxes are coitsoli-dated in the offices of the County Property Appraiser and the County Tax Collector. The laws of the State regulating tax assessment are also designed to assure a consistent prcperty valuation method state wide. State statutes permit municipalities to levy property taxes at a rate of up to 10 mills. The millage rate assessed by the City for the fiscal year ended September 3C, 1991, was 2.85.
All property is assessed according to its f air market value on January 1 of each year. Each assessment roll is submitted to the Executive Director of the State Department of Revenue for review to determine if the rolls meet all of the appropriate requirements of State statues.
The current year taxes for the fiscal year, beginning October 1, are billed in the month of November and are due no later than March 31.
On April 1, all unpaid amounts become delinquent and are cubject to interest and penalties. Discounts are allowed for early payment as follows:
November 4%
December 36 January 2%
February 1%
March 0%
Delinquent taxes on ral property bear interest of 18% per year. On or prior to June 1 of .ne following tax year, certificates are sold for all delinquent taxes on real property. After sale, tax certificates I bear interest of 18% per year or at aay lower rate bid by-the buyer.
Application for e tax deed on any unrodeemed tax certificates may be made by the certificate holder after a period of two years.
I Delinquent taxes on personal property bear interest of 18% per year until the tax is eatisfied either by seizure and sale of the property or by the five year statute of limitations.
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. CITY OF GUSENELL,' FLORIDA
=
NOTES TO F2NANCIAL STATEMENTS SEPTEMBER 30, 1991 I NOTE 4 RECEIVABLES (Continued)
The amount of delinquent or uncollected property taxes at year end was immaterial. The City's Tax Calendar is as follows:
Valuation Date: January 1 I Levy Date:
Due Date:
Lien Date:
November 1 March 31, Succeeding Year April 1, Succeeding Year NOTE 5 BOND SERVICE REQUIREMENTS / RESTRICTED ASSETS plDJTIES SYSTEM REVENUE BONDS SERIES 1976 As of September 30, 1991, bond service requirements are current. The following is a summary of the restricted assets related to the Utilities System Revenue Bonds Series 1976.
Revenue Bonds Debt Servige - The City deposits cash monthly into
.= separate account to Iand upcoming principal and interest pay: rents in accordance with the bond resolution. Such cash and investments are reported as restricted ansets.
Renewal and Renlacement - The bond resolution requires a monthly depoait for renewal and replacement (extensions, enlargements or I additions to, or the replacement of capital assets of the facili-ties and emergency repairs thereto or unusual costs of operation and maintenance). The required monthly contribution is computed at 1/12 of 9 percent of the prior year's grens revenue, however, I
no further deposits are required when the balance on hand equals 10 percent of the outstanding principal balance of the revenue bonds.
CUSTOMER DEPOSITS Customer deposits have been restricted to indicate the amount is not available for the fir ancing of current utility operations.
I NOTE 6 PROPERTY, PLANT AND EQUIPMENT A summary of changee -in general fixed assets follows:
BALANCE BALANCE 10/1/9Q ADDITICNS DISPOSALS 9/30/91 I. Land S284,309 S 5 - S 284,309 Buildings 139,871 26,716 - 166,587 Improvementa 30,127 202,274 232,401 Machinery and Equipment )_19,350 37,574 - 356,924
$773,657 5266,564 $1,040,221 I
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.- CITY OF BUSENELL, FLORIDA 5 NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1991
- NOTE 6' PROPERTY, PLANT AND EQUIPMENT (Continued)
A summary of Proprietary Fund Type property and equipment at I September 30, 1991 follows:
ELECTRIC WATER UTILITY UTILITY SANITATION I- FUND FUNp_,, FUND TOTAL 20,390 Land S 2,300 S 18,090 S S
Distribution I Plant Buildings Equipment 981,553 11,181 178,044 593,813 134,436 721,291 119,908 1,575,366 145,617 1,019,243 Crystal River #3 Investment 279,894 - - 279,894 1,452,972 1,467,630 119,908 3,040,510 I Accumulated Depreciation (470,935) (288,500) f94,'96) ( 853,831)
S 9824 037 $1,179,130 S 25,512 $2,18o,679 NOTE 7 OPERATING LEASE I The City is committed under a lease for a fire truck. *his lease is considered for accounting purposes to be an operating lease. The lease expenditure for the year ended September 30, 1991 totalled $12,493.
Future minimum lease payments for this lease is as follows:
Year Ending Arount 1992 12,493 I 1993 1994 12,493 111493
$37,479 I NOTE 8 LONG-TERM DEBT The following is a summary of the bonds payable and genera. long-term debt:
Proprietary Fund Lono-Term Debt I Utilities System Revenue- Bonds Series 1976 - S500,000 The 1976 bonds are coupon bonds in denominations of SS,000 each and are I collateralized by a pledge of the gross revenues of the utilities system.
The bond liability is recorded according to use of the original proceeds as follows - Electric Utility Fund 86 percent; Water Utility Fund 14 percent. Combit.ed bond maturities and interest rates are as
- follows
i.
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CITY OF EUSENEII, FLORIDA NOTES TO FINANCIAL STATEMENT 3 SEPTEMBER 30, 1991 NOTE O LONG-TERM DEBT (Continued)
I MAiURITY SEBJL_J,_,
COUPON
,,P4,TE_
TOTAL PRINCIPAL AMOUNT Term Bonds 1991 7.3% $ 15,000 1992 7.3% 25,000 1993 7.3% 21,000 1994 7 . 3 's 30,000 1995 7.3% 35,000 I 1996 1997 1998 7.3%
7.3%
7.3%
35,000 40,000 45,000 WATER ELECTRIC 1999 7.3% 13 1QQ FUND FUND I Total Principal Balance outstanding Less Unamortised Discount and Issue Costs
$305,000 542,700 $262,300 (7,194) 11,004) _15t122)
$297,806 $41,696 $256,110 Total Remaining Interest S 94,900 $13,286 S,813 14 6 I The term bonds due in 1999 are subject to mandatory redemption by lot in the amounts listed above.
The term bonds which were due on April 1, 1991 in the remaining amount of $15,000 were not presented for payment as of September 30, 1991 and are, therefore, included as outstanding.
Wal_er Fund - Florida Municinal Power Acency -
Initial Do o1 ,d Loan I
9 Proiect The City has entered into a financing agreements with the Florida Municipal Power Agency (FvDA). Interest is payable monthly at a variable rate (currently 4. . : % plus a 1.25% administration fee) and principal is due as follows:
_ July 1 November 1 Total I 1991 1992 S .
10,000 S 20,000 20,000 S 20,000 30,000 1993- 10,000 20,000 30,000 1994 10,000 25,000 35,000 1995 10,000 25,000 35,000 1996 10,000 30,000 40,000 1997 10,000 30,000 40,000 1998 $ 10,000 5 30,000 .S 40,000 1999 15,000 35,000 50,000 2000 15,000 35,000 50,000 2001 15,000 - 15,000
. 2002 15,000 - 15,000 2003 15,000 -
15,000 2004 -20,000 - 20,000 2005 20,000 - 20,000 2006 20,000 - 20,000 I_ 2007 20,000 -
20,000 2008 25,000 - 25,000 2009 25,000 -
25,000 2010 25,000 - 25,000 1 2011 26,000 -
_76,000 4 S326,000 $270,000 $596,000 18
CITY CF CUSENELL, FLORIDA NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1991 I
NOTE 8 LONG-TERM DEBT (Continued)
Water Fund Mortoace Note Payable - Bennie Harrison I The following is a schedule of the mortgage note payable to Bennie Harrison:
Remaining Principal Interest 1992 1,000 325 1993 1,000 260 1994 1,000 195 1995 1,000 130 1996 1,000 65 55,000 $ 975 Principal and interest (at 61/2%) payments are due annually on January I 31. The balance is securedby Water Fund land.
PRINCIPAL '
BALANCF GENERAL LONG-TERM DEBT 9/30/f; l
j Mortgage Payable, secured by first mortgage on sports complex real estate, due in t
sonthly paymente of $570, interest j
at 74.2% of prevailing prime rate S 84,610 1
L Accumulated unpaid vacation & sick i
pay accrual 34,875 l
Note Payable, collateralized by 1991 Ford l Crown Vjctoria, due in monthly l payments of $400, including l interest at 9.4% 8,803 Nots payable, collateralized by 1989 Yord crown Victcria, due in monthly paymente of $484, including Interest at 10.5% 3,040
$131,328 l During the year ended September 30, 1991, the following changes occured l in liability reported in the general long-term debt account group BALANCE BALANCE 10/1/90 ADDITIONS DISPOSALS 9/30/91 Mortgage Payable S 91,450 5 - S G,840 $ 84,610 Notes Payable 13,700 12,477 14,334 11,843 Accumulated unpaid l I vacation and sick pey accrual 32,681 2,193 - 34,875 S137,832 S14,670 $214113 S13J1328 19
CITY OF BUSENELL, FLORIDA NOTES TO FINANCIAL STATEMENTS I SEPTEMBER 30, 1991 I NOTE 9 ACCUMULATED UNPAID VACATION AND SICK PAY BENEFITS I I. m mulated unpaid vacation and sick pay benefits are accrued when
. Mrred in proprietary funds. Such amounts are not accrued in govern-
= j ;tal funds. At September 30, 1991, governmental fund liabilities included $34,875 in vacation and sick pay (see Note 8). This amount is included in the General Long Term Debt Group of Accounts.
Accumulated unpaid vacation and sick pay in Enterprise Funds are as follows:
9/30/91 9/30/90 Electric Utility Fund S 9,483 S12,964 6,774 9,060 I Water Utility Fund Sanitation Fund 2,223 S18,480 1.422
$23,446 City policy as of September 30, 1991, is to allow up to a maximum accumulation of 1,040 hours4.62963e-4 days <br />0.0111 hours <br />6.613757e-5 weeks <br />1.522e-5 months <br /> of sick leave. Upon voluntary termination 50 percent of tne accumulated hours are paid to the employee (75 percent for long-term employees with twenty or more years of full-time I service). The City accrues 100 percent of unpaid vacation pay and 50 percent of accumulated unpaid sick pay at the employee's current pay rate.
NOTE 10 ELECTRIC POWER AGREEMENTS I Crystal Power Unit #3 Participation Agreemert:
The City is a participant in an agreement with Florida Power Corpora-tion which was entered into on July 31, 1975. Under terms of the agreement, the City acquired a 0.0388% ownership intorest and genera-tion entitlement share in the nuclear steam electric generating unit I Participants are entitled to energy output of the unit based upon their respective generation entitlement share.
Florida Municipal Power Agency:
I The City is a member of the Florida Municipal Power Agency (FmPA) which is a joint action agency formed by a number of Florida municipalities for the purpose of providing electric power alternatives for its members.
FMPA is a nonprofit, joint action agency. Formed pursuant to Florida Statutes, FMPA has tha authority to undertake joint power supply projects and to issue tax-exempt bonds or other obligations to finance I or refinance the costs of such projects.
Due to the diverse needs of Florida's municipal electric systems, FMPA was established as a project-oriented agency. Under this structure, I each member has the option whether or not to participate in a project.
Members may choose to participate in more than one project; however, each of the Agency's five projects is independent from the others, and no revenues or funds available from one project can be used to pay the I costs of any other project.
The City has elected to participate in the " All Requirements Project",
which supplies all the City's pcwer requirements including load regula-I tion. In addition, the City has elected participation in the " Pooled Loan Project" in which FMPA issues debt with members, then loans the money to individual systems to finance utility related projects.
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C8TY OF BUSHNELL, FLORIDA NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30, 1991 NOTE 11 PENSION FUND All full-time employees participate in the State of Florida Retirement System, a multiple employer Public Employee Retirement System (PERS).
The payroll for employees covered by the System for the year ended September 30, 1991 was approximately $448,884; the City's total payroll was approximately $478,823.
Regular class employees, which includes all employees except law enforcement officers and firefighters who have attained age 62 I- completing 10 or more years of service, or regardless of age completing 30 years of service are eligible for retirement benefits. The calcula-tion of monthly benefits is based on average final compensation (AFC)
W as defined in the plan. Retirement benefits range from 1.60% of AFC per k year of service to 1.68% of AFC based upcn retirement age or length of service.
g Special risk class employees, which includes law enforcement officers and firefighters who have attained age 55 completing 10 years of Ty special risk sarvice, or age 52 with 25 years special risk service, or 25 years continuous special risk service regardless of age, or 30 years I of any creditable servica regardleas of age are eligible for retirement benefits. The calculation of monthly benefits is based on AFC and range from 2.00% per year of service to 3.C0% of AFC based upon service period.
Active employees who become disabled and have completed the length of service as defined in the plan receive a minimum benefit of 42% of AFC for in-line-of-duty and 25% of AFC for regular disability.
If an active employee dies in the line-of-duty, a member's spouse will receive a monthly benefit of one-half the member's monthly salary at death for his or her lifetime until remarriage. If tse spouse dies without remarrying, the benefit will continue to the member's children until the youngest reaches age 18, or until married, if earlier. If employee is terminated by death other than in-line-of-duty before completion of 10 years of service, the designated beneficiary will receive a refund of any retirement contributions. If the member has 10 or more years of service, the surviving upouse or eligible beneficiary may receive a refund of contributions paid by the member or a lifetime monthly benefit calculated as though the member had retired on the date of death.
' I Retirement coverage is for employee non-contributory. Employers pay all contributions. Employer contributions for the fiscal year ended September 30, 1991 were 16.20% for regular members and 26.00% for t
I I npecial risk members, and totalled $84,474.
The " pension benefit obligation" is a standardized disclosure measure l g of the present value of pension benefits, adjusted for the effects of jg projected salary increases and step-rate benefits, estimated to be payable in the future as a result of employee service to date. The measure, which is the actuarial present value of credited projected benefits, is intended to help users assess the System's f unding status l.I l
I on a going-concern basis, assess progress comparisons among PERS and employers. The System does not make separate measurements of assets and pension benefit obligation for individual employers. The pension
! benefit obligation at July 1, 1990 (the date of the latest actuarial valuation) for the System as a whole was $27.4 billion. The System's net assets available for benefits on that cate (valued at market) were 516.1 billion, leaving an unfunded penaion benefit obligation of $1.13 billion. The City's fiscal year 1990 contribution as a percent of total contributions required of all participating entities has not been determined.
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CITY OF BUSENELL, FLORIDA NOTES TO FINANCIAL STATEMENTS SEPTEMBER 30,-1991 NOTE 11 PENSION FtfND (Continued)
I Ten year historical trend information presenting the PERS progress in accumulating sufficient assets to pay benefits when due is precented in the PERS June 30, 1991 Annual Report.
l NOTE 12 OTHER DISCLOSURES Deficit retained F?rnings of individual funds:
Water Utility Fund $36,919 Segment Information for Enterprise Funds:
The City maintains three enterprise funds which provide electric, water and sanitation services Segment information as of September 30, 1991 is as follows:
ELECTRIC WATER UTILITY UTILITY SANITATION FUND FUND FUND TOTAL Operating Revencen $1,252,491 S 186,302 S133,663 S1,572,456 Depreciation &-
Amortization 52,973 41,525 6,813 101,311 Operating Income (Loss) 227,009 (4,154) 16,100 238,955 Operating Transfers In (Out) (183,673) - (10,000) (193,673)
Net Income (Loss) 45,526 (20,519) 8,438 33,445 Current Year Capital contributions - 5,503 - 5,503 Property & Equipment Additions 59,376 49,874 612 109,862 Total Assets 1,808,938 1,438,305 108,309 3,355,552 Net Working Capital 331,485 204,133 73,672 609,290 I
Bonds Payable Net i Payable from Operating Revenues 221,710 36,096 - 257,806 Total Equity S1,302,226 S 841,954 5 99,184 S2,243,364 INTERFUND INTERFUND FUND EECEIVABLES PAYABLES ceneral Fund S- S-Electric Utility Fund 3,899 -
, Water Utility Fund - 3,899 Sm Sm I
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'l I CITY OF BUSENEI&, FLORIDA NOTES TO FZNANC8AL STATEMERTS SEPTEMBER 30, 1991 I NOTE 12 OTHER DISCLOSURES (Continued)
Interfund transfers: JJi _O_QI General Fund $193,673 $ -
Electric Fund - 183,673 Water Utility Fund - -
Sanitation Fund - 10,000
$193,673 $193,63 Allowances for Doubtful Accounts:
Electric Utility Fund S 7,000 500 I
Water Utility Fund Sanitation Fund 500
$ 8,000 I
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I I COMBINING AND INDIVIDUAL FUND FINANCIAL STATEMENTS I
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GENERAL FUND The General Fund is used to account for resources tradition- l I ally associated with governments which are not required to be accounted for in another fund. The General Fund receives a greater variety and number of taxes than any other fund. The i
City of Bushnell, Florida General Fund directly services I general long term debt.
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W CITY OF BUSHNELL, FLORIDA GEWERAL FUND
-lE COMPARATIVE BALANCE SHEETS SEPTEMBER 30, 1991 AND 1990 1991 1990 ASSETS Cash S 174,468 $ 262,581 Utility Taxes and Franchise Fees Receivable 31,614 31,172 Due From Other Governments 27,116 23,169 Inventories, at Cost 905 1,314 i Total Assets S 234,113 $ 318,236 LIABILITIES AND FUND BALANCE 1 Liabilities:
Accounts Payable S 98,093 S 23,767
-Accrued Liabilities 6,178 6,393 Deposits 850 675 Deferred Revenue 2,298 2,288 Total Liabilities 107,419 33,123 Fund Balancest Reserve for. Petty Cash 750 750 Reserve for Inventories 905 1,314
.l 283,049 5' Fund Balance--Unreserved 125,039 Total Fund Balances 126,694 295,113 Total Liabilities and 234,113 318,236 I Fund Balances S 5 I
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I See Accornpanying Notes to Financial Statements 24 l
W CITY OF BUSHNELL, FLORIDA GENERAL FUND I COMPARATIVE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES YEARS ENDED SEPTEMBER 30, 1991 AND 1990 I 1991 1990 Revenues I Taxes Licenses and Permits S 275,487 24,970
$ 262,000 10,883 Intergovernmental 349,412 225,179
'I Charges for Services Fines and Forfeits 210 19,450 714 23,583 Miscellaneous Revenuo 27,022 23,660 Total Revenues 696,551 546,019 I Expenditures General Government Public Safety 210,592 369,639 176,245 310,674 I Physical Environment Transportation Economic Environment 2,579 149,615 11,000 2,701 112,755 10,931 Culture and Recreation 290,801 94,889 I Debt Service:
Principal 21,174 20,190 Interest 5,311 9,557 Total Expenditures 1,060,711 737,942 I Excess (Deficiency) of Revenues Over (Under) Expenditures (364,160) (191,923)
Other Financing Sources Operating Transfers In:
Electric Utility Fund 183,673 120,000 10,000 I Water Utility Fund -
Sanitation Fund 10,000 10,000 Loan Proceeds 12,477 11,853
-Total Other Financing Sources 206,150_ 151,853 '
Excess (Deficiency) of Revenues and Other Financing Sources Over (Under) Expenditures (158,010) (40,070)
Fund Balances October 1 285,113 325,227 l
.W Increase (Decrease) in Inventory Reserve (409) (44)
I Fund Balances September 30 S 126,694 S 285,113 l
I l~ See Accompanying Notes to Financial Statements 25
M M M M M M M M M M M M M M M m M M M Page 1 of 2 CITY OF BUSHNELL, FLORIDA GENERAL FUND COMPARATIVE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES--BUDGET AND ACTUAL YEARS ENDED SEPTEMBER 30, 1991 AND 1990 VARIANCE VARIANCE 1991 FAVORABLE 1990 FAVORABLE (UNFAVORABLE) BUDGETED ACTUAL (UNFAVORABLE)
BUDGETED ACTU@
Revenues: 262,000 19,240 259,540 5 275,487 S 15,947 5 242,760 S S Taxes S 11,315 24,970 13,655 11,827 10,883 (944)
Licenses and Permits 238,624 225,179 (13,445) 362,573 349,412 (13,161)
Intergovernmental 714 14 700 210 (490) 700 Charges for Services 23,583 7,063 19,500 19,450 (50) 16,500 Fines and Forfeits 21,000 23,660 2,660 l 15,750 27,022 11,272 Miscellaneous Ravenue 27,173 531,411 546,019 14,608 669,378 696,551 Total Revenues w
m Expenditures:
201,689 210,592 (8,903) 175,613 176,245 (632)
General Government 306,090 310,674 (4,584) 367,899 369,639 (1,740)
Public Safety 3,200 2,579 621 2,450 2,701 (251) '
Physical Environment 112,755 3,224 142,369 149,615- (7,246) 115,979 Transportation 10,931 -
11,000 11,000 - 10,931 Economic Environment 9'7,488 94,989 2,599
'280,318 290,801 (10,483)
Culture and Recreation Debt Service: 20,000 20,190 (190) 19,529 21,174 (1,645)
Principal 10,000 9,557 443 10,382 5,311 5,071 Interest 1,060,711 (24,325) 738,551 737,942 609 Total Expenditures 1,036,386 Excess (Deficiency) of Revenues (207,140) (191,923) 15,217 (367,008) (364,160[ 2,848 Over (Under) Expenditures (See Accompanyir.g Notes to Financial Statements)
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.M Page 2 of 2 CITY OF BUSHNELL, FLORIDA GENERAL FUND COMPARATIVE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES--BUDGET AND ACTUAL YEARS ENDED SEPTEMBER 30, 1991 AND 1990 V RIANCE VARIANCE 1991 FAVORABLE 1990 . FAVORABLE BUDGETED ACTUAL (UNFAVORABLE) BUDGETED ACTUAL (UNFAVORbBLE)
Other Financing Sources:
Operating Transfers In:
Electric Utility Fund S 183,673 S 183,673 S S 120,000 S 120,000 $ -
Water Utility Fund 10,000 -
(10,000) 10,000 10,000 -
Sanitation Fund 10,000 10,000 -
10,000 10,000 -
Loan Proceeds 12,500 12,477' (23) 15,000 11,853 (3,147)
Proceeds From Sale of Assets - - -
1,000 -
(1,000)
Total Other Financing Sources 216,173 206,150 (10,023) 156,000 151,853, (4,147)
Excess (Deficiency) of Revenues and Other Financing Sources Over (Under) Expenditures (150,835) (158,010) (7,175) (51,140) (40,070) 11,070 Fund Balances October 1 285,113 285,113 -
325,227 325,227 -
Increase (Decrea'se) in Inventory Reserve -
(409) (409) -
(44) (44)
Fund Balances September 30 S 134,278 S 126,694 S (7,584) $ 274,087 S 285,113 S 11,026 s
(See Accompanying Notes to Financial Statements)
4 E Page 1 of 2 CITY OF BUSHNELL, FLCRIDA I GENERAL FUND STATEMENT OF REVENUES BUDGET AND ACTUAL I
YEAR ENDED SEPTEMBER 30, 1991 (WITH COMPARATIVE ACTUAL RESULTS FOR THE YEAR ENDED SEPTEMBER 30, 1990)
) VARIANCE PRIOR FAVORABLE YEAR B]QI.tiU_I BUDGETED hqIVAL (UNFAVORABLEl b_Q.T,9AL I I4 Meet Ad valorem S 82,680 $ 86,753 S 4,073 50 5 79,999 Local Alternate Fuel Decal User Fee -
50 -
Franchise Feesa Telephone 1,200 1,262 62 1,177 27.000 39,087 2,087 37,519 l
3 Electric Cable TV 3,700 4,486 786 3,604 Utility Service Taxes:
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10,900 13,389 2,489 11,108 Tilephone 1
I Gas Electric Fuel Oil 6,500 43,250 60 7,614 46,029 1,615 1,114 2,779 1,535 6,754 44,059 42 City Utility Tax 69,000 70,218 1,218 72,523 City Utilities Surcharge 5,250 4,984 (266) 5,349 Bankruptcy - - -
66 9tal Tar.es 259,540 275,407 15,347_ 262,000 I Licenses and Permits:
Occupational Licenses Building Permits 4,300 7,000 4,153 20,784 (147) 13,784 4,182 G,683 15 33 18 18 I Other Total Licenses and Permits 11,315 24,970 13,655 10,883 J.n.;,ercovernmental t Revenue:
Two Cent Cigarette Tax 11,996 12,427 431 12,944 State Revenue Sharing 36,546 40,330 3,784 36,546 I Mobile Home Licenses Alcoholic Beverage License 4,200 1,400 4,725 422 525 (978) 3,884 1,613 Five Cent Sales Tax 31,333 45,228 13,895 30,514 County Fire Fee 42,000 43,077 1,077 41,965 State Grant 127,500 120,000 (7,500) 4,385 Share of County Occupational License 2,500 2,274 (226) 1,835 Rebate on Municipal Vehicles 750 609 (141) 805 -
Sumter County Two Cent Gas Tax 104,348 80,320 (24,028) 90,588 Total Intergovernmental Revenue S 362,573 $ 349,412 S (13,161) 5 225,179 2 )
i %
[-l See Accompanying Notes to Financial Statements 28 l i
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N Pego 2 of 2 CITY OF BUS 3NELL, FLORIDA GENERAL FUND STATEMENT OF REVENUES BUDGET AND ACTUAL I YEAR ENDED SEPTEMDER 30, 1991 (WITH COMPAPATIVE ACTUAL REGULTS FOR THE YEAR ENDED SEPTEMBER 30, 1990) 4 VARIANCE PRIOR FAVORABLE YEAR BEVENUM BUDGETER hgIMAL ,(,UNFAVORADi&1 ACTUAL Chara".1.DI fdtTriSafi Mowing Feen $ 700 S 210 $ (490) $ 714 1
I Total Charges For Servicce 700 210 (490) 714 Fines and Forfeltgreat l Fines and Forfeitures 19,000 18,910 (90) 22,878 i Police Education y0_ 540 4C 705
'I Tot al Fines and Forfeitures 19,500 19,450, (50) 23,583,
+ Miscellaneous Revenueq,1, l
m Interont Earned 6,000 9,484 3,484 11,968 Rent 3,750 3,900 150 3,125
- Misec11aneous 6,000 13,638 7,638 8,567 15,7E3 27.022 31,272 23,660_
1 Total Revenue $ 669,378 5 696,551 $ 27,173 S 546,019
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See Accompanying Notes to Financial Statements I 29
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Pcge 1 of 5 CITY OF BUSHNELL, FLORIDA I GENERAL FUND SI'ATEMENT OF EXPENDITUREE EUDGET AND T.CTUAL YEAR ENDED SEPTEMBER 30, 1991 (WITH COMPARATIVE ACTUAL RESULTS FOR THE YEAR EdDED SEPTEMDER 30, 1990)
VARIANCE PhIOR FUNCTION /ACTIVliY/ FAVOR.3LE YEAR AEBACTIVITY/OS)/ST 3.WQLTID. hEIVAL IUNFAVORAf5LE) bCTUAL I gpysral Government Se rv i c q3,,1,
.+gislatives Council Feea $ 12,600 $ 12,250 $ 350 S 10,000 General Insurance 3,987 4,379 (392) 3,545 Travel & Per Diem 400 - 400 -
Aid to Private Agency 1,000 700 300 _850 Total Genere.1 Govurnment Services __,1,7,987 17,329_ 638 15,195 Financial and Administratives Executive Sulary 69,821 70,090 (269) 66,557 I Regular Salary FICA Taxes Retirement 16,748 6,622 14,4f' 17,037 c,665 14,794 (289)
(43)
(328) 15,875 6,281 12,240 Workmen's Compensation 4 ", c 838 (368) 476 Group Insurance 10,225 11,197 (1,572) 7,097 Professiona? Services 16,500 21,592 (5,092) 3,219 I Accounting & Auditing 5,500 5,515 (15) 7,414 Contractual Services 5,750 7,730 (1,980) 6,554 Travel & Per Diem 2,800 2,837 (37) 2,756 communication Services 1,750 2,103 (353) 1,946 I Utilities General Insurance 2,100 3,700 2,549 4,469 (449)
(769) 2,464 3,947 other current Charges 3,000 4,696 (1,696) 4,221 Office Supplies 1,500 1,270 230 1,547 Operating Supplios 4,500 3,650 850 4,173 Repair & Maintenance 1,500 72 1,428 192 I Books, Publications and Memberships 1,200 768 432 976 Capital outlay 1,000 - 1,000 1,995 I
Total Financial and Administrativo 169,152 178,472 (9,320) 149,930
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l Legal Coannel 14,550 14,791 (241) 11,120 i
l Total General Government Services $ 201,689 $ 210,592 $ (8,903) 5 176,245 I
See Accompanying Notes to Financial Statements 30
1 Page 2 of 5 CITY OF BUSHNELL, FLORIDA I GEhERAL FUND STATEMENT OF EXPENDITURES BUDGET AND ACTUAL YCAR ENDED SEPTEMBER 30, 1991 (WITH COMPARATIVE ACTUAL RESULTS FOR THE YEAH FNDED SEPTEMBER 30, 1990)
VARIANCE PRIOR FUNCTION / ACTIVITY / FAVORADLE YEAR SUDACTIVITY/ OBJECT gqqgETED A N AL ,LUNF AVORABLE ) ACTUAL biblic Saf etyt Police Dapartment Executive Salaries S 31,447 5 31,303 S (56) $ 29,954 Regular salarie; 104,849 106,052 (1,203) " ,994 Other Salaries 2,000 2,319 (319) 1,188 Holiday Pay 2,642 5,502 (2,820) 168 Incentive Pay 2,400 3,268 (868) 2,280 FICA Taxes 10,968 11,34? (399) 10,072 I Retirement Contributions Group Insurance Workmen's compensation 33,129 26,422 6,219 34,482 25,178 6,053 (1,353) 1,244 166 24,141 16,035 4,756 Contractual Services 6,30u 3,325 2,975 4,405 Travel O Per Diem 2,800 1 200 1,600 2,337 Comniunication and Phone 1,500 1,396 104 1,479 I Utilities 3,000 3,518 (518) 3,613 Insurance--Gereral 8,378 9,709 (1,331) 7,794 Repair & Maintenance 5,500 6,893 (1,393) 6,357 1,067 2,465 I
Other Current Charges 3,150 2,083 Office Supplies 500 867 (367) 586 Operating Supplies 18,646 14,014 4,632 14,210 Police Education 2,500 693 1,807 1,580 Looks and Memberships 225 801 (576) 154 Aid to Governmental Agencies - - - 1,750 Discretionary Fund 500 500 -
I Capital Outlay 18,400 15,770 2,630 15,053 Total Police Department S 291,515 $ 286,493 $ 5,022 S 247,411 I ,
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See Accompanying Notes to Financial Statements 31
I CITY OF BUSHNELL, FLORIDA Page 3 of 5 CENERAL FUND STATEMENT OF EXPENDITURES BUDGET AND ACTUAL YEAR FNDED SEPTEMBER 30, 1991 (WITH COMPARATIVE ACTUAL RESULTS FOR THE YEAR ENDED SEPTEMBER 30, 1990)
VARIANCE PRIOR FUNCTION / ACTIVITY / FAVORABLE YEAR SUBACTIVTTY/OBJFCT E.MDG P,, TED hply)4 lylyRQRABLE) LCTUAL Fire Department:
Executive Salaries S 3,780 S 3,894 S (114) S 2,425 Personal Allowances 12,800 19,001 (6,201) 7,904 FICA Taxes -
298 (298) 69 Retiremer.t -
973 (973) 142 Group Insurance -
413 (413) 36 Workmen's compensation 1,000 2,094 (1,094) 1,902 contractual Services 1,240 240 1,000 -
Communication Services 400 403 (3) 400 Rentals 12,493 12,493 - 12,493 Insurance 6,955 8,602 (1,647) 6,863 Repairs & Maintenance 5,000 2,589 2,411 b,997 Other Current Charges 800 431 369 902 Books and Memberships 475 591 (116) 737 Operating Supplies 8,673 7,190 1,483 10,645 Office Supplius 200 36 164 106 Travel & Per Diem 800 245 555 -
School & Training 1,600 1,327 273 421 Capital Outlay 9,208 _ 11,424 (2,216) 1,471
' s.tal Fire Department 65,424 72,244 ( ta , o 2 0 ) 52,513 l
Building Inspector l Regular Salarica 6,780 6,881 (101) 6,715 FICA Taxes 580 527 53 512
- l. Contracted Fee 800 904 (104) 880 Travel & Per Diem 2,500 2,550 - 2,550 Books & Memberships 250 210 93 40_
Total Building Inspector 10,060 10,902 58 10,750 Total Public Safety S 367,899 5 369,639 5 (1,740) 9 310,674 I
I See Accompanying Notes to Financial Statements I_ 32
F I CITY OF BUSHNELL, FLORIDA Pcge 4 of 5 GENERAL TUND STATEMENT OF EXPENDITURES BUDGET AND ACTUAL YEAR ENDoD SEPTEMBER 30, 1991 (WITH COMPARATIVE ACTUAL RESULTS FOR THE YEAR ENDED SEPTEMBER 30, 1990)
_m-VARIANCE PRIOR FUNCTION / ACTIVITY / FAVORA8LE YEAR SUBACTIVITY/QPJECT BUDGETED AGIMhk (UNFAVORABLEl hg.TifAL I Physical Envirgnments Cemetery:
Professional Services S 700 $ -
S 700 $ -
Utility Service 200 279 (79) 241 Aid to Governmental Agenclea 2,000 2,000 - 2,400 Aid to Private Organizations 300 300 - -
Total Physical Environment 2,200 2,579 621 2,701,_
TransportatioD1 Ecad & Street Departments Executive Salary 1),628 14,741 (1,113) 14,074 Regular Salary 11,736 11,277 459 10,910 2,171 (671) 1,293
['3 Other Salaries FICA Taxes 1,500 2,055 2,183 (128) 2,002 Retirement Contributions 4,183 4,281 (98) 3,816 4,953 5,230 (277) 3,653 I Group Insurance Workmen's Compensation General Insurance 1,640 1,716 2,157 2,338 (517)
(622) 1,902 1,597 Professional Services 9,000 8,555 (555) 5,033 I. Contractual Services Repairs & Maintenance 5,000 2,200 2,911 2,574 2,089 (374) 3,072 2,420 Other Current Charges 500 1,049 (549) 304 I Operating Supplies Street Lights - Electricity 4,217 29,541 3,470 28,813 747 728 4,676 33,202 Capital outlay 51,500 57,865 (6,365) 24,801 Total Transportation 142,369 149,615 (7,246) 112,755 Economic Environments
( Professional Services - - - 2,931 Miscellaneous contribution Sumter County Industrial Development Authority 11,000 11,000 - 8,000 l
l Total Economic Environment 5 11,000 5 11,000 S 5 10,931 See Accompanying Notes to Financial Statements I 33
Page 5 of 5 CITY OF BUSHNELL, FLORIDA I GENERAL TUND STATEns.NT OF EXPENDITURES BUDGET AND ACTUAL YEAR ENDED SEPTEMBER 30, 1991 I (WITH COMPARATIVE ACTUAL RESULTS FOR THE YEAR ENDED SEPTEMBER 30, 1990)
VARIANCE PRIOR FUNCTION / ACTIVITY / FAVORABLE YEAR SEDACTIVITY/Olgf&T Dj!AqfuTIE hgIVAL UNFAVORABLTl ACTUAL G.qlt.gre and Recreations Library:
I Aid to Private Organizations Utility Services S 6,000 450
$ 6,000 487 S 0 (37)
$ 6,000 354 Total Library 6,450 6,487 (37) 6,354 Parks & Recreations Exocutivo Salary 2,271 2,919 (648) 2,755 I Regular Salar*es Other Salaries 1,956 941 645 1,015 (645) 1,046 FICA Taxes 323 371 (48) 290 Retirement Contributions 658 812 (154) 573 Workmon's Compenssation 213 391 (178) 317 Contract'tal Services 3,000 11,348 (8,348) 29,239 I Professional Services - - - 2,083 Group Insurance 825 1,083 (258) 419 Utilities 7,000 9,164 ( 2,163. ) 7,679 Rentals 1,300 2,365 (1,065) 1,237 Repairs & Maintenance 2,500 2,103 398 1,400 Other Current Charges 500 270 230 2,461 Operating Supplies 2,637 3,532 (895) 3,405 General Insurance 2,350 2,737 (387) 2,186 Capital Outlay 220,000 229,423 (9,423) 16,845 Land Acquisition 10,000 -
_10,000 -
Total Parks and Recreation 255,533 268,103 (12,570) 71,93F Special Events:
Operating 18,335 16,211 ,
2,124 16,600 Total Culturo and l Recreation 280,318 290,801 (10,483) 94,889 ILebt Serviggi
- , g Principal 19,529 21,179 (1,645) 20,190 9 , 5.,7 lE Intarest 10,382 5,311 5,071 Total Debt Service 29,911 26,485 3,426 29,747 l
Total Expenditurea $ 1,036,386
$ 1,060,711 $ _(2_4,325) S _]37,942 See Accompanying Nctes to Financial Statements I 34
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1 I SPECIAL REVENUE FUND FINANCIAL STATEMENTS Evergreen Cemetery r
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l CITY OF BUSHNELL, FLORIDA l EV,?RGREEN CEMETERY SPECIAL REVENUE FUND ;
I COMPARATIVE BALAhCE SHEETS SEPIEMuER 30, 1991 AND 1990 1991 1922 ASSETS Cash $ 3,505 $ 2,134 Re,stricted Assets:
Cash and Investments 255,256 240,120_
S _258,761- S 242,254 1
LJABILITIES AND FUND BALANCES Liabilitins:
1,0$0 Depowits S 1,200 $
Fund Balances Reserved: Perpetual Care 255,256 240,120 Unreserved 2,305 1,084 257,561 241,204 I TOTAL LIABILITIES AND FUND BALANCES $ 258,761 S 242,254 I
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I See Accompanying Notes to Financial Staternenta 35
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CITY OF BUSHNELL, "',ORIDA EVERGREEN CZHETERY SPECIAL REVENUE FUND l I COMPARATIVE ST ATEMEllTS OF REVENUES, EXPEN)ITURES AND CHANGES IN FUND BALANCES FOR TH5: YEARS ENDED SEPTEMBER 30, 1991 AND 1990 ,
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l 1991 lid 2 Revenues I Contributions Sale of cemetery 1.rca S 8,676 3,000
$ 8,801 8,050 Interest Earnod 18,183 17,992 Hemorial Gifts and Trust 255 367 Total Revenues 30,114 35,210 Expenditures Operating and Maint'4 nance 13,757 10,114 Capital Outlay - 2,113 Total Expenditures 13,757 12,227 Excess of Revenues Over Expenditur9s 16,357 22,963 Fund Salances October 1 241,204 218,221 Fund Balances September 30 S 257,561 $ 2_4_1,204_.
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I I ENTERPRIBE FUNDS Enterprise Funds are used to account for operations (a) that are finanec~.1 and operated in a manner similar to private business entr.cpricos--where the intent of the goverr ing body is that the costs (expenses, including depreciaMon) of I providing goods or services to tha general public on a continuing basis be financed or recovered primarily *:hrough user charges; or (b) vhere the governing body has decided that periodic deterr.ination of revenues earned, expenses I incurred, and/or net income is appropriate for capital maintenance, public policy, management control, account-ability, or other purposes. Certain administrative expenses are paid by the General Fund.
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M M m' M M M M M M M M Page 1 of 3 CITY OF BUSHNELL, FLOPIDA ENTERPRISE EUNDS COMBINING BALANCE SHEET SEP* EMBER 30, 1991 (WITH COMPARATIVE TOTALS FOR "EPTEMBER 30, 1990) i ELECTRIC WATER TOTALS U*ILITY UTILITY SANITATION SEPTEMBER 30 FUND FUND FUND 1991 1990 ASSETS Current Assets:
Cash and Cash Equivalents 5 207,458 S 197,215 $ 65,432 S 470,105 5 277,953 Custonic Acccunts Receivable 168,936 21,969 17,865 208,769 211,328 Allowance for Doubtful Accounto (7,000) (500) (5003 (8,000) (6,000)
Due From Other Furds 3,899 - - 3,899 1,193 Inventories, at Cost 66,957 7,439 - 74,396 74,800 Prepaid Expenses 6,114 - - 6,114 _
7,740 To*al Current Assets 446,364 226,122 62,797 755,283 567,014 d RestricteC Absets, Cash and Investments:
Nuclear Decommissioning 37,941 - - 37,941 31,667 Debt Service 87,905 19,134 -
107,039 104,916 Renawal and Replacement 197,435 - - 197,435 184,687 Customer Deposits 57,256 - - 57,256 52,649 Total Restricted Assets, Cash and Investments 380,537 7.9,134 -
399,671 373,919 Property and Equipment, at Cost Utility Plant in Service 1,452,972 1,467,630 119,908 3,040,510 2,930,648 Accumulated Depreciation (470,935) (238,500) (94,396) (853,831) ( 7 %~4,520 )
Total itmperty and Equipment (Net of Ar. amulated Depreciation) 982,037 1,179,130 25,512 2,186,679 2,178,128 Other Acsets:
Loan Cost (Net) -
13,919 -
13,919 7,794 Total Assets S 1,808,938 S 1,438,305 S 108,309 5 3,355,552 S 3,126,855 See Accompanying Notes to Financial Statements
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Pege 2 of 3 CITY OF BUSHNELL, FLORIDA ENTERPRISE FUNDS GMBINING BALANCE SHEET SEPTEMBER 30, 1991 (WITH COMPARATIVE TOTALS F3R SEPTEMBER 30, 1990)
ELECTRIC WATER TOTALS UTILITY UTILITY SANITATION SEPTEMBER 30 FUND FUND FUND 1991 1990 i LIABILITIES AND FUND EOUITY Current Liabilities:
Accounts Payable S 103,136 S 8,806 $ 6,248 5 118,190 S 168,733 Accrued Liabilities 2,260 1,510 654 4,424 3,262 ,
Compensated Absences Payables 9,483 6,774 2,223 18,480 23,446 :
Due to Other Funds -
3,899 -
3,899 1,193 Current Portion of Note Payable -
1,000 - 1,000 3,877 Total Current Liabilities 114,879 21,989 9,125 145,993 _200,511 g Current Liabilities (Payable From Festricted Assets); i Customer Deposits 57,256 - -
57,256 52,649 Accrued Interest Payable 9,574 1,559 -
11,133 11,498 Current Portion of Bonds Payable 34,403 5,600 -
40,000 35,000 Total Current Liabilities (Payable From Restricted Assets) 101,230 7,159 -
108,389 99,147 Long Term Liabilities:
evenue Bonds Series 1976 (Net of Current Portion and Discount) 221,710 36,096 -
257,806 281,781 Long Term Portion of Note Payable -
4,000 -
4,000 5,000 Note Payable - FmPa 68,893 527,107 -
596,000 336.000 Total Long Term Liabilities 290,603 567,203 -
857,806 _622,781 Total Liabilities 506,712 596,351 9,125 1,112,188 922,439 '
i See Accompanyi?.3 Notes to Financial Statements
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M M M. M M M M Pege 3 of 3 CITY OF BUSHNELL, FLORIDA z;drbRPRISE FUNDS COMBINING BALANCE SHEET SEPTEMBER 30, 1991 (WITH COMPARATIVE TOTALS FOR SEPT 2MB2R 30, 1990)
ELECTRIC WATER TOTALS UTILITY UTILITY SANITATION SEPTEMBER 30 FUND FUND FUND 1991 1990 LIABILITIES AND FUND EOUITY (Continued)
Fund Equity:
Contributed capital S 176,381 S 878,873 S 29,449 S 1,084,703 S 1,079,200 Retained Earnings (Ceficit):
Reserved 272,791 - -
272,'i31 274,772 Unrese rved 851,054 (36,919) 69,735 885,870 850,444 Total Retained Er.rnings 1,125,845 ~ (36,919) 69,735 1,158,661 1,125,226 Total Fund Equimy 1,302,226 441,954 99,184 2,243,364 2,*204,416 Total Liabilities and Fund Equity 5 1,808,938 5 1,438,305 S 108,309 5 3,355,552 5 3,126,855
'1 See Accompanying Notes to Financial Statercents
M M M M M M M M M M N M M M M M M -
CITY OF BUSHNELL, FLORIDA COMBINING STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN RE"AINED EARNINGS (DEI'ICIT ) - E*FERPRISE FUNDS f YEAR E'!DED SEPTEMBER 30, 1991 (WITH COMPARATIVE TOTALS FOR THE 1' SCAL YEAR ENDED SEPTEMBER 30, 1990)
ELECTRIC WATER TOTALS {
UTILIT'l UTILITY SANITATION SEPTEMBER 30 l
FUND FUND FUND 1991 1990 l
l Operating Revenues: 133,663
- 1,572,456 5 1,602,408 Charge for Services S 1,252,491 S 186,302_ S l
Operating Expenses: - 765,990 752,309 Purchased Power 765,990 -
87,996 65,273 32,176 185,445 165,759 Salaries 18,426 79,103 61,615 34,246 26,431 l
Employee Benefits 1,342 43,465 39,259 28,082 14,041 l
Professional Services 33,242 32,171 9,445 .7,432 6,365
- Operating Supplies 10,980 83,484 68,719 Other Current Charges 46,750 25,754 52,973 41,525 6,813 101,311 9b517 Depreciation 41,461 34,722
- - 41,461 Landfill - - - - 20,336 State Gross Receiots Tax 117,563 1,333 501 1,269,407 Total Operating Expenses 1,025,482 190,456_
227,009 (4,154) 16,100 238,955 333,001 Operating Income (Loss)
IJon-Operating Revenues (1*xpense ) : 2,338 35,511 41,090 l 30,559 2,614 Interest Earned - - - - 14,500 cain on Sale of Equipment l (28,369) (18,979) - (47,348) (52,151) l Interest Expense l l
To' ai Non-Operating Revenues (Expense) 2,190 (16,365) 2,338 (11,837) 3,439 (
l l l
229,199 (20,519) 18,438 227,118 336,440 l Operating Income (Loss) Before Transfers (10,000) (193,673; (140,000) operating Transfers (Out) ]I83,673) i 45,526 (20,519) 8,438 33,445 196,440 Net Income (Loss) 1,080,319 (16,400) 61,297 1,125,216 928,776 Retained Earnings October 1 Retained Earnings (Deficit) 69,735 S 1,158,661 S 1,125,216 September 30 9 1,22.,845 5 (36,919) S See Accompanying Notes tc Financial Statemer,s
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(Pcge 1 of 2)
CITY OF BUSHNELL, FLCRIDA ENTERPRISE FUNDS COMBINING STATEMENT OF CASH FLOWS FOR THE YEAR ENDED SEPTEMBER 30, 1991 ELECTRIC WATER UTILITY UTILITY SANITATION
, FUND FUND FUND TOTALS t
Cash Flows From Operating Activities:
Cash Received From Cuwtomers, including Cash Deposits $ 1,292,159 S 182,786 S 129,922 5 1,604,867
- Cash Paid to Suppliers (934,090) (83,561) (89,313) (1,106,964)
Cash Paid to Employees (90,771) (67,422) (17,350) (175,543)
Cash Deposits Returned to Customers (25,245) - -
(25,245)
Net Cash Provided By Operating Activities 242,053 _ 31,803 23,259 297,115 Cash Flows From Noncapital ~rinancing Activities:
Capital contributions - Customers -
5,503 -
5,503 Received From (Paid To) Other Funds (4,786) 4,786 - -
Operating Transfert. Out (183,673) -
(10,000) (193,67M Net Cash Used In Noncapital Financing Activities ( 188,4 Me ) 10,289 (10,000) (188,170)
Cash Flows From Capital an
- Related Financing Activities:
Loan Proceeds 68,893 194,751 -
263,(.44 Purchase of Property and Equipment (59,376) (49,874) (6121 (109,862)
Principal Paymerits (17,787) {14,304) (761f (32,852)
Interest ' aid (28,683) (18,799) -
(47,482)
Net Cash Provided By (I' sed In) Capital and Related Financing Activities (36,953) 111,774 (1,373) 73,448 I Cash Flows ;om Investing Activities:
Receipt of Interest and Dividends 30,559 2,614 2,338 35,511 1
Net Cash Provided By Investing Activities 30,559 2,614 2,338 35,511 Net Increase In Casa 47,200 156,480 14,224 217,904 Cash, October 1 540,795 59,869 51,208 651,872 Cash, September 30 S 587,995 S 216,349 $ 65,432 S_ 869,776 I See Accompanvino Notes to Fir _ancial Statements I i
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.m m M M M (Page 2 of 2)
CITY OF BCSHNELL, FLORIDA ENTERPRISE FUNDS ,
L.OMBINING ST7TY. MENT OF CASH FLOWS
- THE YEAR ENDED SEPTEMBER 30, 1991 ELECTRIC WATER UTILITY UTILITY STNITATION FUND FUND FITNC TOTALS Reconciliation of Operating Income to Net l
Cash Provided By Operating Activities: 227,009 5 (4,154) S 16,100 S 238,955 5
l Operating Income (Loss)
Adjustments to Reconcile Operating Income to Net 'Ish Provided By Operating Activities: 41,525 6,813 101,311 52,973 D.r reciation Change in Assets and Liabilities: 9,816 (3,516) (3,741) 2,559 (Increase) Decrease in Accounts Receivable
- Increase (Decrease) in Allowance For 1,800 (100) 300 2,000 Uncollectible Accounts 1,626 -
- 1,626 (Increase) Decrease in Prepaid Expenses 136 (22) 290 404 (Increase) Decrease in Inventory 192 2,497 (50,543)
Increase (Decrease) in Accounts 'ayable f (53,232) 164 199 1,162 Increase (Decrease) in Accrued Expenses 799 3 Increase (Decrease) in Accumulated (3,481) (2,286) 801 t4,966)
" Compensated Absences 4,607 - - 4,607 i
Net Increase in Customer Deposits 15,044 35,957 7,159 58,160 Total Adjustments 242,053 31,803 S 23,259 S 297,115 Net Cash Provided by Operating Activities 5 5 =
t i
See Accompanying Notes to Financial Statements s
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I AGENCY FUNDS FINANCIAL STATEMENTS Bail Dond Fund I
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l l a CITY OF BUSHNELL, FLORIDA AGENCY YUNDS
I BALANCE SHEET SEPTEMBER 30, 1991 (WITH COMPARATIVE TOTALS FOR SEPTEMBER 30, 1990) 1 I -
g SEPTEMBER 30 .
1990 E 1991 _
- Asim 2,050 2,699 cash $_ S i
2,699 Q
Total Acosts mu,2 2,05 $
$ =_u_,0 t . . _ _ - _ _ _ _ _ _
l Lib.B_,lk] TIES l
I Liabilities:
Deposits S 2,050 5 _ 2,699 l Total Liabilities $ 2,050 5 2,699 l ~
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!, see Accompanying Notes to Financial Statements ..
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SUPPLEMENTARY INFORMATION 2
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DAVID C. LOGAN Certified Public Accountant January 15, 1992 INDEPENDENT AUDITOR'S REPORT ON 90FPLEMENTARY INFORMATION - SCHEDULE OF STATE FINANCIAL ASSISTANCE I Honorable Mayor and Members of the City Council City of Bushnell Bushnell, Florida I have audited the general purpose financial statements of the City of Bushnell, Florida for the year ended September 30, 1991, and have issued my report thereon dated January 15, 1992.
I general purpose financial statements are the responsibility of the city of Bushnell, Florida management. My responsibil.ity is to These express an opinion of these general purpose financial statements based on my audit.
I conducted my audit in accordance with generally accepted auditing I standards and Government Auditing Standards, issuued by the Comptroller General of the United Staten. Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of I material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the general purpose 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. I believe that my audit provides a reasonable basis for my opinion.
My audit was made _for the purpose of forming an opinion on the general purpose financial statements of the City of Bushnell, I Florida taken as a whole. The accompanying schedule of state financial assistance is presented for purposes of additional analysis and is not a required part of the general purpose financial statements. The information in that schedule has been subjected to the auditing procedures applied in tho audit of the general purpose financial statements and, in my opinion, is fairly I presented in all material respects in relation to the general purpose financial statements taken as a whole.
O w David C. Loga Certified Public Accountant 44 3425 Lake Center Drive
- Mount Dora, Florida 32757 * (904) 383-3500
- Fax (904) 383-5441
m M. m M' W m m M . m m m m m' M M M M CITY OF BUSENZLL, FLORIDA SCHEDULE OF STATE FINANCIAL ASSISTANCE YEAR ENDED SEPTEMBER 30, 1991 1 GRANT PROGRAM DCE FROM CASH DUE FROM IDENTIFICATION AWARD OTHER GOVT. RECEIPTS GRANT OTHER GOVT.
STATE GRANTOR NUMBER AMOUNT 10-1-90 STATE EXPENDITUPES 9-30-91 Florida Department of Natural Resources Florida Recreation Development Assistance Program F89-132 S120,000 $ -
$108.000 (1) 5463,942 5 12,000 (2) Grant expenditures are reconciled to the project completion report as follows:
Total expendi+ures per project completion report 5263,942 Matching contribution (fair market value of real estate) as approved October 22, 1990 200,000 Total Grant Expenditures $463,942 T
- .- -- - - . - - - . - - . .. - - _- ~_ _ _ - -
DAVID C. LOGAN Certified Public Accountant l January 15, 1992 AWITOR' S REQB r ON CQfPLI Al[C.E BASED ON AN AUDIT OF THE OllGRAL PURPOSE FIl!ANCIAL STATEMENTjl PERFORMED IN ACCORDARCE WITH GQ1ERNMENT /\@lTING STANDARDS E Honorable Mayor and Members
< of the City Council I City of Bushnell Bushnell, Florida I have audited the general purpose financial statements of the City of Bushnell, Florida, as of and for the year ended September 30, 1991, and havc issued my report thereon dated January 15, 1992.
I conducted my audit in accordance with generally accepted auditing standards and Government Auditine] Standards, issued by the Comptroller General of the United St0tes, Thone standards require that I plan and perform the audit te obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement.
Compliance with laws, regulations, contracts, and grants applicable to the City of Bushnell, Florida, is the responsibility of the management of the City of Bushnell. As part of obtaining reason-t able assurance about whether the general purpose financial statements are free of material misstatements, I performed tests of l
the City's compliance with certain provisions of laws, regulations, contracts, and grants. However, my objective was not to provide an
! opinion on overall compliance with such provisions.
The results of my tests indicate that, with respect to the items tested, the City of Bushnell, Florida complied, in all material respects, with the provisions referred to in the preceding paragraph. With respect to items not tested, nothing came to my
'I attention that caused me to believe that the City had not conplied, in all material respects, with those provisions.
l l This report is intended for the information_of the management of the City of Bushnell, Florida and the State of Florida Auditor
'I' General. This restriction is not intended to limit the distribu-tion of this report, which is a matter of public record.
Cl* O David C. Logc Certified Public Accountant u
3425 Lake Center Drive
- Mount Dora, Florida 32757 * (904) 383-3500
- Fax (904) 383-5441
I DAVID C. LOGAN Certified Public Accountant January 15, 1992 REPORT ON TliE INTEBEAL CONTROL STRUCTURE IN ACCORDAN_CE WITH GOVERNMENT AUDITING STaHDARQJi Honorable Mayor and Members of the City Council City of Bushnell Bushnell, Florida I I have uudited the general purpose financial statements of the City of Bushnell, Florida for the year ended September 30, 1991, and have issued my report thereon dated January 15, 1992.
I conducted my audit in accordance with generally accepted auditing standards and Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement.
In planning and performing my audit of the general purpose financial statements of the City of Bushnall, Florida, for the year ended September 30, 1991, I considered the internal control structure in order to determine my auditing procedures for the purpose of expressing my opinion on the general purpose financial I statements and not to provide assurance on the internal control structure.
I The management of the City of Bushnell, Florida is responsible for establishing and maintaining an internal control structure.
fulfilling this responsibility, estimates and judgments by In management are required to assess the expected benefits and related I costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable, but not absolute, acsurance that assets are safeguarded against loss from unauthorized use or disposition, and that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of i I general purpose financial statements in accordance with generally accepted accounting principles. Because of inherent limitations in any internal control structure, errors or irregularities may Lg nevertheless occur and not be detected. Also, projection of any l g.
I evaluation of the structure to future periods is subject to the risk that procedures may become inadequate because of changes in I conditions or that the ef fectiveness of the design and operation of policies and procedures may deteriorate.
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1 47 l
l 3425 Lake Center Drive
- Mount Dora, Florida 32757 * (904) 383-3500
- Fax (904) 383-5441 l .__ . , _-_
Honorable Mayor and Members of the City Council January 15, 1992 Paga; 2 I For the purpose of this report, I have classified the significant internal contr.1 structure policies and procedures in the following categories: cash and cash equivalents; revenue, receivables and I receipts of governmental funds; service revenue and receivables of proprietary funds; expenditures for goods and services, and accounts payable; payroll and related liabilities; and property, equipment, and capital expenditures.
For all of the internal control structure categories listed above, I obtained an understanding of the design of relevant policies and I procedures and whether they have been placed in operation, and I assessed control risk.
My consideration of the internal control structure would not I necessarily disclose all matters in the internal control structure that might be material weaknesses under standards established by the American Institute of Certified Public Accountants. A material I weakness is a reportable condition in which the design or operation of one or more of the specific internal control structure elements does not reduce to a relatively low level the risk that errors or irregularities in amounts that would be material in relation to the general purpose Linancial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. I noted no matters I involving the internal contro) structure and its operation that I consider to be material weaknesses as defined above.
I However, I noted matters involving the internal control structure and its operation that I have reported to the uanagement of the City of Bushnell in a separate letter dated January 15, 1992.
This report is intended solely for the use of the management of the l City of Bushnell, Florida 'nd the State of Florida Auditor General and should not be used fc1 any other purpose. This restriction is not intended to limit the distribution of this report which is a matter of public record.
42x
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David C. Lo'an certified public Accountant l
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I DAVID C. LOGAN Certilled Public Accountant January 15, 1992 AEQ.,ITOR' S_ LETTER TO MANAQIBf1C' I Honorable Mayor and Members of the City Council I City of Bushnell Bushnell, Florida I heve audited the general purpose financial statements of the City of Bushnell, Florida as of and for the year onded September 30-1991, as listed in che Table of Contents, and have issued my report thereon dated January 15, 1992.
The following comments are pursuant to the Rules of the Auditor General Chapter 10.550:
- 1. Any or all irregularities reported in the preceding annual fiscal audit have been corrected.
- 2. Recommendations made in the preceding year's annual financial audit have been followed except for: (see asterisk in 3 below)
- 3. To ir. prove the City's financial management, accounting proco-dures, and internal control, we recommend:
- A. Service rovenue and receivables of proprietary funcia
- 1. A routine should be established to reconcile customer I accounts receivable detail records with the general ledger control account monthly.
- 4. I did not discover any violationr., of laws, rules, or regulations within the scope of the financial audit.
- 5. There were no illegal or improper expenditures within the scope of the financial audit.
- 6. other matters which have not been mentioned in the preceding sections of this report or the Independent Auditor's Report on Internal Control Structure or the Independent Auoitor's Report on Compliance:
I a. Improper or inadequate accounting procedures - none.
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49 L 3425 Lake Center Drive
- Mount Dora, Florida 32757 * (904) 383-3500
- Fax (904) 383-5441
l I
! Honorable Mayor and Members l of the City Council l g January 15, 1992 Page 2 I 1 1
I b. Failures to properly record financial transactions - only routine audit entries, i
- c. Other inaccuracies, 4rregui tes, shortages, and def alca- l tions discovered by the auditor - none. !
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- 7. The financial report filed with the Department of Banking and Finance pursuant to Section 218.32, Florida Statutes, is in agreement with the annual financial audit report for the year ended September 30, 1991.
David C. Log-n Certified Public Accountant l
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I SfgIl10LE ELECTRIC COOPERATIVE. INCm CONSOLIDATED FINAL [C.IAL STATEMEHIS DECEMBER 31. 1991 I
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5 REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCSUNTANTS w I
'o Board of Trustees
- le Electric Cooperative, Inc.
r g -
opin.on, i the accompanying consolidatea balance sheets '
3- anc cne related consolidated statements of revenue and cxpenses and patronage capital and of cash flows present ce fairly, in all material respects, the financial position of
$h Seminole Electric Cooperative, Inc. and it.s subs !. diary (the Cooperative) av oocember 31, 19;1 and 1990, and the results e of their operations and their cash flows for the years then ended in conformity with generally accepted accounting principler. These financial statements are the responsibild*y of the Cooperative's management; our I responsibill.y is to express an opinion on these financial statements tssed upon our audits. We con'lucted our audits of these a m m u,:s in accordance with generally accepted ande ;ing stc>,was and the financial audit requirements of tbc government auditing stan:. trds issued by the Comptroller General of the United States. These standards require that we plan and perform the audit to obtain reasonable assurance [.
about whether the financial statements are free of materia; 4 I. misstatement. An audit includes examining, on a test basis, -
evidence supporting the amounts and disclosures in the financial etatements, assessing the accounting principles I used and significant estimates made by management, and evaluating the overall financia) statement presentation. We believe that our tudits provide a reasonable basis for the opinion expressed above.
I Tampa, Florida February 20, 1992 c I
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SEMINOLE ELECTRIC COQP.EMTIVE, IL CONSOLIDATEQ_ BALANCE SHEETS l December 31.
1991 1990 _.
ASSETS Utility plant:
Plant in service $ 745,592,070 $ 737,848,757 Constructi.on work in progress 12,353,374 4,802,827 757,945,444 742,651,584 Less accumulated depreciation and I amortization (172,590,329) (150,658,271)
Utility plant, net 585,355,115 591,993,313 I Investments:
Investments-in associated I organizations Funds held by trustees 11,903,287 16 . 518 , 2 2.Q 12,610,265 16.046.648 Total investments 2P,421.E57 28.656,913 Current assets:
Cash and cash equivalents 75,898,774 67,844,570
% Receivables, principally for L -
sales of electricity 21,203,917 11,834,394
'~"
Inventories, at average cost:
Materials and supplies 14,569,430 14,994,218 Fuel- 25,600,542 25,147,854 Prepayaents and other 2,135,978 2.530,341 Total current assets 139,408.641 122,351,377 Deferred charges 39,909,731 45,944,481 S 793,095,044 $ 788,946,084 I
I e
- The accompanying notes are an integral part of these financial statements.
I I
I SEMINOLE ELEC'TRIC COOPERATIVE. INC, CONSOLLDATER_EALANCE Q SHEETS December 31, 1991 1990 EOUIT'I AND LI ABILITIES Equity:
Memberships $ 1,100 e 1,100 Patronage capital 36,766,995 31,508,037
.I Donated capital 31.615 31,615 Total equity 36,799,710 31,5 & 712 Long-term liabilities:
Long-term debt 619,368,241 625,858,981 32,375,415 33,464,631 I Obligations under capital leases Other 1.865.401 3.653,560 Total long-term liabilities 653.609.061 662.977.17_2 Current liabilities:
Current portion of:
Long-term debt 6,479,163 5,801,013 Obligations under capital leases 1,089,217 993,513 Accounts payable and accrued liabilities 50,149,556 40,366,815 I Accrued interest and taxes, other than income 1.319,607 1,900.556 Total current liabili;les 59.037.543 49.061.897 l Deferred gain on sale-leaseback of plant 25.424.849 26,840.618
, Other deferred credits 18.223.881 18.525.645 Commitments and Contingencies (Notes 10 and 11)
$ 793.095.0*,4 $ 788,946,084 I
I g The accompanying notes are an integral part of these financial statemants.
I I
I I SEMINOLE ELECTRIC COOPERATIVE, INC.
I CONSOLIDATED STATEMENTS OF REVENUE AND EXPENSES AND PATRONAGE CAPITAL For the years ended Deq1mber 31, 1991 1990 Operating revenue $ 451.268,182 $ 437,759,347 Operating expenses:
Operation:
Fuel 174,237,366 174,134,117 Other production expenses 32,401,570 32,890,782 Purchased power 80,534,654 64,475,473 Transmission 26,795,725 28,892,813 I Administrative and general 4
Depreciation and amort.zation Lease of coal-fired plant 16,035,693 25,706,498 30,851,705 15,191,705 25,454,487 31,629,954 Taxes, primarily property 10,464,229 10,505,034 I Operating margins before 397.027,440 383,174,345 interest charges 54,240,742 54,585,002 Interest expense net of amounts capitalized 54,610,600 57,353,900 Operating deficits ( 369,858) ( 2,768,898)
Patronage capital credits 97,367 74,0 3 Net operating deficits ( 282,491) ( 2,694,885)
Nonoperating income:
I Interest income Other income, net 5,948,790 444,621 5,741,167 361,565 Net margins 6,110,920 3,407,847 Datronage capital, beginning of year 31,508,037 2d,982,911 Patronage capital retirements ( 851,962) ( 882,721)
Patronage capital, end of year $ 36,766,995 $ 31,508.017 I
I The accompanying notes are an integral part of these financial state'nents.
l I
SEMINOLE ELECTRIC COOPERATIVE. INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS For the years ended December 31.
Cash flows from operating activities:
Net margins $ 6.110.920 $ 3.407.847 I Adjustments to reconcile to cash:
Depreciation and amortization 27,773,263 27,375,949 Amortization of deferred gain on sale-I- leaseback of plant ( 1,415,769) ( 1,415,769)
Lease expense / lease payment dif'ere ce ( 891,439) ( 891,439) 871,841 I Write off of obsolete inventory 107,312 Other, net ( 37,367) ( 225,556)
Change in assets and liabilities:
I Receivabl es Inventories Prepayments and other
( 9,369,523)
( 899,741) 394,363 (
43,702,634 6,143,834 313,702)
I Defe; red charges Other long-term liabilities Accounts payable and accrued 1,771,853
( 1,78P,155)
( 1,312,329)
( 1,839,254) liabilities _
9,782,741 (13:535,122)
Accrued interest and taxes ( 580,949) (11,354,891) 648.458)
Deferred credits 399.183 (
Total adjustments 25.960.299 45.693,209 I Net cash provided by operating activities 32.071.211 49.101.056 I Cash flows from investing activities:
Utility plant Long-term investments (16,751,706) 392.755
( 5,535,757) 3.910,567 Net cash used in investing activities (16.358.951) ( 1.625 11Q)
.I Cash ..c - from financing activities:
Paymc.'.1 of patronage capital credits ( 851,962) ( 882,721)
Payments of long-term debt ( 5,312,590) ( 5,212,256)
.I Capital lease obligations Net cash used in financing activities
( 993.512)
( 7.658.064)
( 1.231.564)
( 7.326.541)
Net increase in cash and cash equivalents 8,054,204 40,149,325 Cash and cash equivalents -- beginning 67.844.570 27.695.245
~ Cat,h and cash equivalents -- ending $ 75.898.774 S 67.844.570 I
cl l
The accompanying notes are an integral part of these financial statements.
!I
I SEMINOLE ELECTRIC COOPERATIVE. INC.
EQ2TES TO CONSOLIDATED FINANCIAL STATEMENTS I NOTE 1 - THE COOPERATIV_E:
I Sem nole Electric Cooperative, Inc. (Seminole) is a generation and tra temission cooperative. It is responsible for meeting the electric power and energy needs of its eleven distribution cooperative members operating within the State of Florida. Seminole's rates are established by its Board of Trustees, which is composed of representatives from each member cooperative.
I Seminole constructed and operates two coal-fired generating facilicies (Seminole Unit No.1 and Unit No. 2) near Palatka, Florida with approxinately 600 megawatts of net output per unit. These units 3 are -connected to the Florida bulk power supply grid through 5 Seminole's 230 kv transmission lines and associated f acilities. Both units commenced commercial operation in 1984.
Seminole holds a 1.6994% undivided ownership interest in the Crystal River Unit No. 3 (CR3) nuclear power plant operated by Florida Power Corporation. Seminole also owns various transmission facilities connecting individual members to the Florida bulk power grid.
In 1989, Acuera Corp. (Acuera;, a wholly owned taxable subsidiary, I was formed for the primary purpose of acquiring a power plant site for future generation use.
site during 1991.
Acuera completed the purchase of this The site has been leased, subject to certain restrictions, to an Independent Power Producer (IPP).
The consolidated financial statements include the results of operations and financial position of Seminole and Acuera. All intercompany transactions have been eliminated.
NOTE 2 -
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES:
Seminole complies with the Uniform System of Accounts as prescribed l by the Rural Electrification Administration (REA). In conformance l with generalli accepted accounting principles, the accounting l policies and practices applied by Seminole in the determination of
! rates are also employed for financial reporting purposes.
Utility Plant Utility plant owned by Seminole is stated at original cost. Such I cost includes applicable supervisory and overhead cost, plus net interest charged during construction. The cost of maintenance and repairs including renewals of minor items of property, is charged to lE lB operating expense. The cost of replacement of depreciable property units, as distinguished from minor items, is charged to utility plant. The cost of units replaced or retired, including cost of II
I removal, net of any sa.tvage value, 1s charged to accumulate' I- deprcciation. Certain leased transportation equipment is valued at the total net present value of minimum lease payments.
Opprating Revenug Seminole has wholesale power contracts with each of its members, I whereby the members must purchase all electric power and energy which the member shall require for its system within the State of Florida from Seminole to the extent that Seminole shall have such power, I energy and f a cili t.4.es available. The only exception relates to contracts between several members and the Southeastern Power Administration, which provides less than 2% of the total energy required by all members.
Operating revenue consists primarily of sales of electric power and energy by Sem.i nole and a facilities use charge for Seminole's I transmission lines serving a single member cooperative. Member revenues include amounts resulting from a fuel and purchased power adjustment clause which provides for billings to reflect increases I or decreases in fuel and fuel related purchased power costs. The adjustment factor is based on costs projected by Ser'.aole for a twelve-month period. Any a errecovery or underrecovery of costs plus an interest factor are tc be refunded or billed to the members I semi-annually. At December 31, 1991, there was an overrecovery of
$10,328,470 which is recorded as an accrued liability until refunded.
An underrecovery of $2,203,860 at December 31, 1990 is included in receivables.
Included in operating revenue for the years ended December 31, 1991 I and 19E10, are approximately $434 million and $419 million of revenue from members, of which approximate 3y $17 million and $8 million are included in receivables at December 31, 1991 and 1990, respectively.
l- Depreciation and Amortization Seminole provides for depreciation on owned utility plant using
- E composite rates applied annually on a straight-1dne basis that will
,E amortize the original cost of depreciable property over its estimated useful life. The rates for 1991 and 1990 were as follows:
1991 1990 Coal-fired production plant 3.10% 3.10%
l Transmission plant 2.75% 2.75%
Genera] plant 7.79% 7.46%
Nuclear production plant 4.54% 3.20%
lI Amortization ot leased assets under capital leases amounted to lI
$1,004,011 and $915,948 in 1991 and 1990, respectively.
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Amorli2ation.c1f Deferred Gain Deferred gain on cale-leaseback of plant is being amortized on a straight line basis over the base lease term of 25 years commencing in 1985 and is reflected as a reduction of operating expenses.
Ipventories Materials and supplies inventory is stated at the lower of cost or market, cost being determined based on the weighted average purchase I price. Management determined that due to technological improvements and efficiencies in the utilization of certafn items, reductions of
$871,841 and $107,312 were nacessary to properly 9 tate materials and supplies inventory at December 31, 1991 and 1990, respectively.
Caoitalication of Interest In accordance with procedures permitted under the Uniform System of Acce prescribed by the REA, a portion of interest on borrcwed funo. . average ra:es of approximately 8% for both 1991 and 1990, is cap calized as a component of the cost of construction work in
'-I progress and is reflected as a reduction of interest expense. The amcunts of interest capitalized during 1991 and 1990 were $542,786 and $206,085, respectively.
l Deferred Charoes Deferred charges consisted of unamortized debt expense and related j prepayment penalties, certain nuclear fuel disposal costs related to energy purchased by Seminole from Florida Power & Light Company I subsequent to December 1, debits.
1972, costs associated with a load management incentive fee program and other miscellaneous deferred These costs will be recovered primarily through rates over various amortization periods ranging from five to twenty years.
Deferred charges also included depreciation and interest expense I
g on certain transmission lines and production common facilities l g incurred prior to comnercial operation of Seminole Unit No. 2. The unamortized amounts at December 31, 1991 and 1990 were $11,027,142 i
i and $12,405,520, respectively. Such deferrals are being recovered over_a ten year period through a rate phase-in plan. Amortization of these deferred charges amounted to $1,378,378 and $1,378,391 for 1991 and 1990, respectively, and are included in depreciation and amortization.
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Deferred Credi.ts At December 31, 1991 and 1990, deferred credits primarily included g deferred lease expense which represents the dif f erence between cash E payments and expense recogr.ized on a straight-line basis related *.o the operating lease of certain generating facilities, and a reserve for CR3 decommissioning costs.
.I Cash Ecuivalents Seuinole considers all short-term highly liquid investments with a maturity of 3 months or less to be cash equivalents.
Reclassification Certain reclassific' : lons have been made to the 1990 stateraents to conform to current .assifications. There were no changes in net margins as previous f reported.
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NOTE 3 UTILITY PLANT: l December 31 l 1991 1990 Owned property:
.I Coal-fired plan
- Transmission pl_.It
$ 579.648,19e 89,338,727
$ 574,811,260 87,130,683
.3 General plant 20,980,498 20,463,714 g Nuc. lear plant, including fuel 16,235,212 26,053,665 706,202,635 698,459,322 !
I Leased property under capital leases: 1 Transportation equipment 39,389.435 39,389,435 l 745,592,070 737,848,757 Construction work du progress 12,353,374 4,802.327 I- 757.945,444 742,651,584 I Accumulated depre.ciation and amortization (166,536,764) (146,608,717) l Accumulatad amortization )
of leased assets ( 6.053,565) ( 5.049,554)
(172,590.329) '150,658,271)
$ 585,355,115 $ gl,993,313 l 1
NOTE 4 - INVESTMENTS: i December 31 I 1991 1990 l
Investments in associated organizationu: l l
National Rural Utilities Cooperative Finance Corporation (CFC): -
l Membership $ 1,000 $ 2,000 8 Capital Term Certificates 1,402,544 1,402,544 l Subordirrted Term Certificates 9,027,503 9,031,456 1,019,100 1,604,140 i Patr(nagu Capital Certificates
- I National Bank'for Cooperatives (CoBank)
Other 313,982 139,158 424,502 146,623 j
I $ 11,903,287 $ 12,610,265 Funds hc2.d by trustees:
Pollution control bond funds $ 14,921,898 $ 14,764,134 I Nuclear cecommissionirg trust-fund 1,596,37_2
- 6.518,270 1,282,514
$ 16,046,648 I
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. NOTE 5 - LONG-TERM LIABILITIES:
1,ona-Term Debt' I l December 31 ,
1991 1990 g ! First. mortgage notes payable to 3 Federal Financing Bank ( F FB ', ,
gtaranteed by REA, principal due in various installments through 2020, interest at 7.221% to 10.983% $ 457,142,289 $ 461,164,346 First mortgage notes phyable to I REA, principal due in various
' installments through 2019, interest at 5t 5,327,33' 5,443,023
- Pollution contrcl revenue bonds, j payable to the Putnam County Development Authority, guaranteed by CFC, principal due in various installments through 2014, interest at adjustable rates, currently 5.00% and 4.,0% 155,300,000 156,900,000 First mortgage notes payable to I CFC, principal due in various installments through 2019, interest at adjustable rates, currently 6.125% and 9.50% 8,07'.77J. 8,152,625 625,847,404 631.659,994 Less current portion ( 6 479,161) ( 5,801.013)
$ 619,368.241 $ 625,858.981 Interest paid, including that on th: doove debt. totaled $54,130,944 and
-I $67,637,391 in 1991 and 1990, respectively.
The estimateu maturities and annual sinking fund requirements of all I -long-term debt for the four years subsequent t.o December 31, 1992, are presented below:
Annual Maturities I Year ending December 3.1.,
and Sinking Fund Recuirements 1993 $ 7,144,000 1994 $ 7,946,000 1995 $ 8,808,000 1996 $ 9,628,000 I .
I In December of 1991, Seminole entered into an interest rate swap agreement to manage exposure to changes in interest rates on a portion of its adjustable rate pollution control revenue bonds. This agreement I ef fectively changes Seminole's interest rate exposure on the notional principal amount outstanding of $80 million to a fixed rate of 4.21% f or a two year period, without the exchange of the underlying principal I amounts. The differential to be paid or received is accrued as the adjustable interest rate changes and is recognized o->er the life of the agreement at i: component of nonoperating income or expense. In the event of nonpe_rformance of the counterparty, which is an event that I Seminole does not anticipate, Seminole would then be exposed to the risk of the current market interest rates for the adjustable rate pollution control revenue bonde.
Obligations Under Capital Leases At December 31, 1991, Seminole was obligated under certain capital I leases of transportation equipment for which base lease terms expire on various dates through 2005. The following is a schedule of future lease payments under these leases together with the present value of the net minimum lease payments as of December 31, 1991:
Year ending Decer._Jer 3 L.
1992 $ 4,204,318 1993 4,204,318 I 1994 1995 4,204,318 4,527,110 4,644,240 1996 Later years 37.838,739 Total minflum lease payments 59,523,043 (26.158.411)
I Lacs amount representing interest Present velue of minimum lease payments Less cutrent principal portion 33,464,632
( 1,089.217)
$ 32,375,415 These transportation equipment leases provide for renewals and I opticns to purchase at fait market value at various dates or upon expiration.
Rental payments for these transportaticn equipment leases totaled I $4,204,I18 and $4,205,791 for 1991 and 1990, respectively. These payments were included as a cost of fuel inventory and expensed based on the tons of coa] burned throughout the year.
Substan' ially all owned assets and lease' id interests are pledged as collateral for the above mentioned de to the United States of I America (REA and FFB), CFC and CoBank.
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NOTE 6 - NET MAR. GINS AND EO'UITY RESTRICTIONS:
Under provisions of tne-REA mortgage, until the total of equities equals or exceeds forty percent of total assets, the distribution of capital contributed by members is limited generally to twenty-five percent of patronage capital and margins of the next preceding year i where, after giving effect to such distribution, the total equity j I will equal or exceed twenty percent of total assets. Distributions may be made, however, in such amounts as may be approved by REA through waiver of the aforementioned restrictions. Such i
3 distributions to members totaled $851,f52 and $882,721 in 1991 and 3 1990, respectively.
The REA mortgage requires St.. mole to design its wholesale rates with I a view towards maintaining, on a calendar year basis, a Times Tnterest Earned Ratio (as defined) of not less than 1.0 and a Debt l Service Coverage Ratio (as defined) of not less than 1.0. An REA stipulation arising from the sale of tax benefits requires Seminole !
to design its wholesale rates to provide an annual Times Interest Earned Ratio (as defined) of not less than 1.05.
In 1991 and 1990, Seminole achieved a Times Interest Earned Rat!o (as defined) of 1.10 and 1.05, respectively, and a Debt Service Coverage Ratic (as defined) of 1.3 for both years.
NOTE 7 - LINES OF CREDIT:
Seminole had available lines of credit totaling $93 million of which none were drawn at December 31, 1991. REA policy governs use of these funds.
NOTE 8 - INCOME _ TAXES-Seminole is a non-exempt cooperative subject to federal and state income taxes and files a consolidated return. As a cooperative, I Seminole is entitled to exclude from taxable income those margins assigned to members as patronage credits.
Seminole's ratemaking methods provide that income taxes are I recognized as expense and are recovered through rates when currently payablo In addition, income tax credits are accounted for as a reduction of taxes currently payable in the period utilized. In 1991 I and 1990, there were income tax losses due to timing differences in the recognition cf certain income and erpenses f or tax and financial reporting purposes, primarily sale-lease.back of plant and utilization In 1991 and 1990, no income taxes were I of member loss carryovers.
paid.
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Since Seminole became taxable in if81, deferred taxes have not been approximately $220 million of timing differences.
I provided c.
Current ratemaking practices prcvide future recovery of to_ timing dif f erences previouely flowed through. At taxes related December 31, 1991, net operating losses and income tax credits of approxinately
~B $220 million and $13 million are available to offset future taxable income and tax liabilities, respectively, through 2006 and 2001. In 1991, all remaining member loss carryovers were utilized.
During 1992, the Financial Accounting Standards Board issued Statetent No. 109, " Accounting for Income Taxes" which is effective for the fiscal years beginning after December 15, 1992. This statement will require certain changes in the way Seminole accounts for income taxes, including a requirement to record an asset related to timing dif ferences previously flowed through and the establishment of the related income taa liability. Adoption of this statement is not expected to have a material effect on the financial statements.
NOTE 9 - R]LTIREMENT PLAN :
Substantially all Seminole employees participate in the National Retirement and Rural Electric Cooperative Association (NRECA)
Security Program (the Program), a defined benefit pension plan qualified under Section 401 and tax-exempt under Section 501(a) of I the Internal Revenue Code. Seminole had made annual contrioutions
- o the Program equal to the amounts accrued for pension expense until July 1,1987, when a moratorium on con ributions came into ef fect due to reaching full lunding limitation. Accordingly, there was no I pension expense under -this rian for 1991 or 1990. In this multiemployer plan, which is available to all m.mber cooperatives of NRECA, the accumulated benefits and plan assets are not determined or allocatea aeparately by incividual employer.
NOTE 10 OPERATING LEASES:
At December 31, 1991, Seminole was obligated under certv leases of generating facilities and transportation equipment fc which base I- lease terms expire on various dates through 2009. Tne lease of the generating facilities contains a variable interest rate component l that could affect future lease payments.
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Base rental obligations under thase leases are payable as follows:
Year ending December 31.
I 1992 $ 40,795,758 1993 $ 40,795,758 1994 $ 40,795,758 1995 J 40,795,758 1996 $ 40,795,758 ,
Thereafter S 507,010,327 These leases provide for renewals and options to purchase at fair market value at various dates or upon expiration.
Rental payments for rhese transportation equipment leases totaled ,
$4,609,100 and $3,940,595 for 1991 and 1990, respectively. These I payments were included as a cost of tuel inventory and expensed based on the tons of coal burned throughout the year.
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. NOTE 11 - COMMITMENTS AND CONTINGENCIEE:
Seminole is purchasing coal for the plant under long-tem contracts I I expiring in-2010. Contract terms specify minimum annual purchase commitments, subject to force majeure conditions, and prices, which are subject to adjustment for changes in costs. In addition, i'
_g Seminole has long-term contracts for coal transportation. Contract l g tems include a minimum cost as detemined by a base quantity of tons !
shipped and prices, which are subject to adjustment for changes in l costs. Total charges under these agreemcnts were approximately $101 l million and $107 million in 1991 and 1990, respective.ty. l In May of 1990, Seminole established an external Nuclear Decommissioning Trust Fund (NDTF) in compliance with regulatione l
-I prescribed by the Nuclear Regulatory Commission. The fund balance I
of approximately $1.6 million represents Seminole's cumulative share of the estimated sinking fund reserve required to decommission CR3.
Prospectively, annual cash deposits will be made to the FDTF representing Seminole's annual snare of the projected sinking fund requirements. These amounts will be recovered from members through I .- l rates and a provision made in current operations each year. Based
!: 5 upon a study completed in 1986 and updated in 1991, Seminole's total share of the projected cost of decommissioning is approximately $3.7 million in 1991 dollars, and decommissioning expenditsres are
__- expected to occur over a.nine year period ending in tne year 2023.
During 1989, Seminole entered into a twenty year agreement, r
commencing in 1993, with an IPP for the purchase of 195 megawatts of l capacity by Seminole from a generating statien to be constructed and I operated by the IPP on a site leased from Acuera and, during the initial ten years of the agreement, an additional 145 megawatts of lI
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l capacity to be supplied by the IPP from an existing coal fired generating f acility. Under the terms of the agreement Seminol.e will receive this capacity on a first call basis, subject to certain restrictions as to its use. Seminole is obligated to make annual "take or pay" capacity payments of approximately $36 million over the initial ten years and approximtu aly $21 million over the final ten years of the agreement.
Management is aware of certain positions taken by the IRS with
, respect to examinations of other cooperatives, including issues with l respect to allocation of income and expense. These matters, if adversely resolved and subsequently applied in an IRS examination of l Seminole, could result in a significant tax liability for Seminole.
l Management believes that its tax returns have been prepared fully in l compliance with applicable sections of the Internal Revenue Code and, l as such, that no significant amount of liability would result from l such an examinstion. Accordingly, Seminols has not recorded a liability related to these issues.
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i FINANCIAL STATEMENTS AND INDEPENDENT AUDITORS' REPORTS 1
CITY OF ALACIIUA --
ALACIIUA, FLORIDA SEI'rEMI5ER 39,1991 1
I FINANCIAL STATEMENTS AhV INDEPENDENT AUDITORS' REPORTS CITY OF ALACilUA ALACIIUA, FLORIDA SEPTEMBER 30,1991 CONTENTS Page Indepdent Auditors' Report 1-2 Gameral Purpose Financial Statements Combined Balance Sheet - All Fund Types and Account Groups 3-4 Combined Statement of Revenues. Expenditures r.nd Changes in Fund Balances - All Govertunental Fund Types - 5 ,
Combined Statement of Revenues, Expenditutes e and Changes in Fund Balances - Budget and Actual All Governmental Fund Types 6-7 Combined Statement of Revenues, Expenses and Changes in Retained Earnings - All Proprietary Fur.d Types 8 Cou bined Statement of Cash Flows - All Proprictary Fund Types 9-10 Notes to Financial Statements Il-36 Arcompanying Information - Combining and Individual Fund Statements-General Fund Balance Sbeets 37 Statement of Revenues - Budget and Actual 38 St:tement of Expendhures - Budget and Actual 3940 Special Revenue Fund - Community Development Block Grant III Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual 41 Proprietary Funds 3 Combining Balance Sheet 42-43 Combining Statement of Revenues, Expenses and Changes in Retained Earnings 44 Combining Statemem of Cash Flows 4546
FINANCIAL STATEh1ESTS AND INDEPENDENT AUDITORS' REPORTS CITY OF ALACIIUA ALACIIUA, FLORIDA SEIFTEMBER 30,1991 CONTENTS (Concluded)
Page Additional Elements of Report Prepared in Accordance With Government Auditing Standards, Issued By the Comptroller -
General of the United States, the Provisions of the Office of Management and Budget (OMB) Circular A-128 and the Rules of the Auditor General of the State of Florida Independent Auditors' Report on Schedule of Fede.al Mnancini Assistance 47 e<hedule of Federal Financial Assistance 48 Indepaident Auditors' Report on Compliance With the General Pequirements Applicable to Major and Nonmajor Federal Mnancial Assistance Prograire 49-50 Independent Auditors' Report on Compliance With Specific Requirements Applicable to Nonmajor Federal Mnancial Assistance Program Transactions 51
-Independent Auditors' Report on the Internal Control Structure Used in Administering Federal Mnancial Assistance Programs 52-54 Independent Auditors' Report an Compliance With laws and Regulations Based on an Audit of General Purpose Mnancial Statements Performed in Accordance Wlth Government Auditing Standants 55 Independent Auditors' Report on Internal Control Structure Related Matters Noted in a General Purpose Er meial Statement Audit Conducted in Accordance With Government Auditing Standards, and Management 12tter 56-59
Purvis Gray &
Company INDEPENDENT AUDITORS' REPORT Honorable Mayor and City Commission City of Alachua Alachua, Florida We have avilted the accompanying general purpose financial statements of the City of Alachua, Florida.,
as of Sep3mber 30,1991 and for the year then ended, as ll;ted in the table of contents. These general purpose financial statements are the responsibility of the City's management. Our responsibility is to express an opinion on these general purpose financial statement based on our audit.
Except as discussed in the following paragraph, we condu.ted our audit in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General of the United States; and the provisions of Of0ce of Management and Budget (OMB) Circular A 128, Audits of State and local Cowrnments. Those standards and OMB Circular A-128 require that we plan and perform the audit to obtain reasonab4 assurance about whether the general purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence suppoaing the amounts and disclosures in the general purpose financial statements. An audit also inc ides assessing the accmunting principics used and significant estimr.tes made by management, as well evaluating the overall general purpose financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
We did not obtain sufficient evidential matter to determine if property, plant and equipment recorded in the Proprietary Fund Types is fairly presented at cost or estimated historical cost, due to insufficient detail within the City's promrty records, in our opialon, except for the effects of such adjustments, if any, u might have been determined to be necessary had we been able to determine the propriety of amounts recorded as property, plant and equipment in the Proprietary Funo Types, the general purpose financial statements referred to above present fairly, in all material respec;s, the financial position of the City of Alachua, Florida, as of September 30,1991 wl the results of its operations and the cash flows of its Proprietary Fund Types
- for the year then endd, in conformity with generally accepted accounting principles.
Certified Public Accountants P.O. Bm 23999
- 222 N.E.1st Street
- Gainesville, Florida 12602 * (904)378-2461 Laurel Ridge Professional Center
- 2347 S.E.17th Street
- OCala, Florida 32671 * (404)732-3872 1415 Piedmont C;ive East, Suite 2
- Tallahassee, Florida 32312 * (9043385-o354 MIM6tR5 07 AMf RIC AN AND FLORIDA INsTITUTt5 0F CEtTiflED PUBUC ACCOUNhN15 Mt MRf A Of AMERIC AN INSTITUTE Of LfRTIFilD PUBUC ACCOUNTANTS PRIVATI COMPAN.ts AND s E C 'RACTiCf 4ECTIONS
Honorable Mayor and City Commission City of Alachua Alachua, Florida INDEPENDENT AUDITORS' REPORT (Concluded)
Our audit was made for the purpose of forming an opinion on the general purpose fmancial statements taken as a whole. The combining and individual fund fmancial statements listed in the table of contents are presented for purposes of additional analysis and are not a required part of the general purpose fmancial statements of the City of Alachua, Florida. Such information has been subjected to the auditing
- procedures applied in the audit of the general purpose financial statements and, in our opinion, except for the effect of such adjustments, if any, related to the matter d.scussed in the third paragraph, is fairly A presented in all material respects in relation to the general purpose fmancial statements taken as a whole.
November 15,1991 .
Gainesville, Florida m 4J, fA Md %
2
GENERAL PURPOSE FINANCIAL STATEMENTS These basic statements provide a summary overview of the financial position of all funds and account groups as well as the operating results of all funds and cash flows of the Proprietary Fund Type. They also serve as an introduction to and summary of the more detailed statements included in the accompanying infc.rmation section.
s
COMIIINED CALANCE SIIEET ALL FUND TYPES AND ACCOUNT GROUPS SEPTEMBER 30,1991 CITY OF ALAC11UA, FWRIDA Accennt Groups Governmental Fund Types 1%prietary General Gmeral Totals Spnial Debt Fund Type Fixed Leag-Term (Memorandum Only)
Revenue Servire Entery Assets IMA 1991 1990 General Assets 5 175,718 5 42,171 5 31,728 5 (123,966) 5 125,651 5 241,772 Cash and Cash Equivalents 66,041 37t.541 441,064 Investments 305 _*00 Receivables (Net of Allowances For Uncollectibles Parenthetical!y Indicated): 90,563 108,893 108,893 Taxes 510,140 457,367 457,367 Accounts (540,200) 1,069 1.069 1,069 Assessments (51,643) 1,249 1,601 Accrued Interest and Penalties 1,249 3,016 15,726 18,742 6,344 Other Receivables 250,000 0
Duc From Water Fund 25,596 32,923 Duc From Other Governments 25,596 191,734 191,734 214,412 Inventory of Utihty Supplies 41,436 52,442 45,455 97.897 Prepaid Expenses 115,497 115.497 99.679 Unbilled Revenue Rertricted Assets: 1,020 825 756,423 1,020,825 Cash and Cash Equivalents 4.1 % ,504 4,196,504 4,377,296 Investments 77,618 1I!,400 111,400 Accrued Interest Propecy, Plant and Equipment - Cost Less Accumulated Dep eciation For Prttwietsry Fund Type; Cost For 10,095,038 7,323,100 5 2,718,020 10.041,120 General Fixed Asset Account Group 405,003 405,003 419,945 Unamortised BonJ lssue Costs Amount Available For Retirement of 31,728 36,591 5 31,728 General Long-Term Debt Amount to be Provided For Retirement 1,382,044 1,369,049 I,369,049 I
of General leng-Term Debt Total Assets 5 672,414 5 42,171 5, 31,728 5 13,825,755 5 2,713,020 5 1,400,777 5 18,690,865 5 19.075,963 I
See accompanying notes.
3 _
_ _ _ _ _ _ _ _ i I
COMBINED BALANCE SHEET ,
AI.L FUND TYPES AND ACCOUNT GROUPS SEITEMBER 30,1991 CITY OF ALAC11UA, FLORIDA (Concluded)
Account Groupe Goveramental Fund Types Proprietary General General Totah Spaial Debt Fund Tg Fixed long-Tmn (Memocandem Only)
General Revenne Service~ Enterprise Assets Debt 1991 1999 Liabilities and Fund Equity Liabilities Accounts Payable $ 105.569 5 18.959 5 184.663 5 309.191 5 274.80r Othee Accrued Expenses 20.912 46.820 67.732 46.837 Payable From Restricted Assets:
Acerved Interest 415 111 415.111 367.189 Current Portion of Bands Payable 162.000 162.000 152.000 Customer Deposits 113.232 113.232 108,429 Due to Genera: Fund 0 250.000 Deferred Revenues and Credns 98.615 23.212 349.273 471.100 420.932 Note Payable - Gulf Brecre 5 940.000 940.000 955.000 Note Payable - FLGFA 418.914 418.914 425.000 Notes Psymble - First National 0 60,193 Chanel Mortgare Payable O 6.424 Revenue Bonds Payable 11.429.403 11.429.403 11.540.931 Accrued Compensated Absences 41.863 d r.M3 65.682 Total Liabi!hics 225.006 42.171 5 0 12.700.502 5 G 1.403.777 14.368.546 14.673.426 Fund Fquity Contributed Capital 1.825,485 1.325.485 1.825.485 Investment in General Fixed Assets 2.718.020 2,718.020 2.672.518 Retained Earnings:
Reserved For Debt Service and Contingencies I/03.603 1fo3fD3 1.555.200 Unreserved (2.303.925) C.303.925) (2,165.582) i und Balances.
Reserved 212.789 31.723 244.517 202.211 Designated 10,963 10.% 3 7.705 Urdesignated 223.566 223.566 304.940 Total Fund Equity 447.3I8 0 31.728 1.125.253 2.718.020 _0 4.322.319 4.402.537 Total Li.bilhics and Fund Ihnity 5 672.414 5 42.171 5 31.728 5 13.825.755 5 2.718.020 5 1.400.77,' 5 18.670.865 5 19.075.% 3 See accompanying notes.
4 l
a
COM INED STATEMENT OF REVENUES, EXPFEDt111RES AND CIIANGES IN FUND BALANCES - ALL GOVERNMENTAL F11ND TYPES FOR TIIE YEAR ENDED SEPTEMBER 30,1991 CITY OF ALACifUA,' FtX)RIDA Goverwnental Fund Typs Totals Spwial Dek (Manorandien Only)"
General Revenue Service 1991 1990 Revenues Taxes and Special Assessments 3 943,939 $ 0$ 0 $ - 943,939 $ L 767,122 Licenses and Permits . 37,616 0 0 :37,616 42,987 Intergovernmental 320,350 278,293 0 598,643 893,329 Charges For Services 43,659 0 0 43,659 42,765 Fines and Forfeitures 18,794 0 0 18,794.' 38,864 Interest and Mi cellarmns 70,425 0 0 70,425 - 106, % 8 Total Revenues 1,434,783 278,293 0 1,713,076 1,892,035 Expenditures Current:
General Government 315,662 0 0 315,662 280,523 Public Safety 779,154 0 0 779,154 830,094 Physical Environment 65,500 0 0 65,5CO 445,181 Economic Environment 0 278,293 0 278,293 0 Transportation 206.084 0 0 206,084 315.379 Parks and Recreation 90,574 0 0 90.574 102.066 Capital Projects 0 0 0 0 91,489 Debt Service 2,020 0 117,772 119,792 111,632 (Total Expenditures) (1,458,994) (278,293) (117,772) (I.P55,059) (2,176,364)
Excess (Deficiency) of Revenues Over (Under) Expenditures (24,21I) 0 (117,772) (141,983) (284,329)
Other Financing Sources (Uws)
Debt Proceeds 0 0 0 0 425,000 (lean Costs) 0 0 0 0 (15,276)
Transfers In 106,II3 0 1I?,909 219,022. 458,687 (Transfers Out) (112,909) 0 0 (112,909) (142,855)
Total Other Financing Sources (Uses) (6,7%) 0 112,909 106.113 725,556 i Excess (Deficiency) of Revenues and Other Financing Sourtes Over (Under) Expenditures and Other Financing Uws (31,007) 0 (4,863) (35,870) 441,227 Fund Balances Beginning of Year 478,325 0 36,591 514,916 73,689 Fund Balarges, End of Year _447.313
$ $ 0 $ 31,728 $ 479,046 $ 514,916 See accompanying notes.
5
COM INED STATEMENT.OF REVENUES, EXPFEDt1URES AND ,.
CHANGES IN FUNS CALANCES - BUDGET AND ACTUAL ALL GOVERNMENTAL FUND TYPES -*
FOR 11IE YEAR ENDED SEPTEMBER 30,1991 -
CITY OF ALACIIUA, FLORIDA Gen (ral Fund Special Revenue Fund Variance Variance Favorable Favorable Budget Actual (Unfavorable) Budget Actual (Unfavorable)
McTenues Taxes and Special Assessments 5 910.289 5 943,939 5- -33,650 $ 0 $ 0 $ 0
' Li-enses and IYrmits 39,500 37,616 (1,884) 0 0 0 Intergovernmental 332,592 320,350 (12,242) 97,500 278,293 180,793 Charges For Services 48,100 43,659 (4,441) 0 0 0 Nes and Forfeitures 20,000 18,794 (1,206) 0 0 0 Interest and Miscellaneous _82,000 70,425 (11,575) 0 0 0 ;
Total Revenacs ~~
' 432,481
, 1,434,783 2,302 97,500 278.293 180,793 Expenditures Current:
General Government 316.067 315.662 405 0 0 0 Public Safety 687,552 779,154 (91,602) 0 0 0 1 Physical Environment 62,724 65,500 (2,776) 0 0 0 Economic Envimr: ment 0 0 0 97,500 278,293 (180,793) .l Transportatkm 197,436 206.084 (8,648) 0 0 0 Parks and Recreatkm 89,555 90,574 (1,019) 0 0 0 Capital Projects 0 0 0 0 0 0 Dcht Service 7,346 2,020 .5.326 0 0 .
0 l (Total Expenditures) (1,360,680) (1,458,994) (98.314) (97,500) (278,293) '793)
Excess (IWency) of Revenues Over (Under)
Expenditures 71,801 (24,211) (06,012) 0 0 0 Other Financing Sot wes (Uses)
Debt Pmeceds 0 0 0 0 0 0 (Loan Costs) 0 0 0 0 0 0 Transfers in 106,113 106,113 0 0 0 0 (Transfers Out) (124,213) (112,909) 11,304 0 0 0 Total Other Finswing Sourecs (thes) (18.100) (6.,796) 11,304 0 0 0 Excess (Deficiency) of Revenues and Other Nancing Sources Over (Under) Expenditures and Other Financing Uses 53,701 (31,007) (84,708) 0 0 0- i Fund Balances, Beginning of Year 478,325 0 Fund Balanen, End of Year 5 447,318 $ 0 See accompanying notes.
6
-'es- -- -- -- - - __._____. - - ____ -, _. -
COMBINED STATEidENT OF REVFNUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL ALL GOVERNMENTAL FUND TYPES EUR TIIE YEAR ENDED SEPTEMBER 30,1991 CITY OF ALACIIUA, FLORIDA (Concluded)
Debt Service Fund Variance Totals Favorable (Memorandum Only)
Budget Actual (Unfavorable) 1991 1990 Revenues Tancs and Special Assessments 5 0 $ 0 $ 0 $ 943.939 $ 767,122 Licenses and Permits 0 0 0 37.616 42.987 Intergovernniental 0 0 0 598.643 893.329 Charges Ihr Services 0 0 0 43.659 42.765 Fines and Ibrfeitures 0 0 0 18.794 38.864 Interest and Miscellaneous 0 0 0 70.425 106.068 Total Revennes 0 0 0 1.713.076 1.892.035 Espenditures Current:
General Government 0 0 0 315.662 280,523 Public Safety 0 0 0 779.154 830.094 Physical Environmen: 0 0 0 65,500 445.181 Ecomnnie finvimnment 0 0 0 278.293 0 Transportation 0 0 0 206.084 315,379 Parks and Recreation 0 0 0 90.51 . 102.066 Capnal Projects 0 0 0 0 91.489 Debt Service 124.213 117.772 6,440 119,792 111.632 (Total Espenditures) (124,213) (117.772) 6.440 (1,855.059) f2.176.364)
Esen (IMiciency) of Revenues Over (Under)
Espmditures (124.213) (117.772 6.440 (141.983) (284.329)
Other Financing Sources (Uses)
Dett Proceeds 0 0 0 0 425,000 (Loan Costs) 0 0 0 0 (15,276$
Transfers in 124.213 112.909 (12.003) 219.022 458.687 (Transfers Out) 0 0 0 (! !2.909) (142.855)
Total Other Financing Sources (Uses' 124.213 I 12.9(n (12.003) 106.113 725.556 Escess (Deficiency) of Revenues and u.her Financing Sources Ovec (Under) Espenditures and Other !
Financing Uses 0 (4.8631 (5.563) (35 870) 441.227 ,
Fund Balances, Iteginning of Year 36.591 514.916 73.669 Fund Halances, End of Year 5 31.728 5 479.05 5 514.916 See accompanying notes.
7
w.
COMBINED STATEMENT OF REVENUES, EXPENSES AND
~
CIIANGES IN RETAINED EARNINGS.-
ALL PROPRIETARY WND TYPFE FOR Tile YEAR ENDED SEPIDIBER 30,1991 CITY OF ALACIIUA,-FLORIDA Total Proprietary (Memorandum
- Fund Type Only)
Enterprise 1990 Operating Revenues $ 4,436,615 5 4,086,052 -i 0,= rating Expenses Power Production Expense . 2,406,072 2,296,243 Customer Accounts- 131,062 116,046 Depreciation ' 302,081 287,118 Warehousing 40,332 39,485 Distribution and Collection 301,902 248,653 General and Administrative 250,717 175,847 ,
' Taxes 76,656 53,471 Treatment'.. 183,842 159,068
- (Total Operating Expenses) (3,692.664) (3,375,931)
Operating Inctane . 743,951 710,121 Nonoperating Revenue (Expenses)_ '
inte. rest income 171,252 187,523 ,
-- (Interest on Long Term Debt)
(884,874) (702.985)
- (Amortization of Bond issue Costs) (14,942) (7,644)
Miscellaneous Income ~ 876 1,746
- Total Nonopereting Revenues (Expenses) (727,688) (521,360)
LIncome Before Operating Expenses (16,263) 188,761_'
(Operating Transfen Out) (106,113) (315,832)
- 3. Net (Loss) - _
(89,850) (127,071)
Retained Earnings (Deficit), Beginning of Year (610,382) (483,311) s
- Retained Earnings (Deficit), End of Year $ (700,232) $ (610,382)
See accompanying notes.
8
COMBINED STATEMENT OF CASil FLOWS ALL PROPRIETARY FUND TYPES FOR Tile YEAR ENDED SEFFEMBER 30,1991
- CITY OF ALACIIUA, FLORIDA Proprietary
_ Fund Type -
Literprise L Cash Flows From Operating Activities Operating Income $ 743,95; Adjustments to Reconcile Operating Income to Net Cash Provided By Operations:
~ Depreciation of Plant- 302,081 Amortization of Decommissioning Costs - 13,320 Provision For Losses on Accounts Receivable 42,921 Change in Current Assets - (Increase) Decrease:
Accounts Receivable and Unbilled Revenue (17,613)
Inventory (Net of Material Salvaged From Retirements of $9,7391 32,417 Prepaid Power Costs (21,040)
Other Prepaid Expenses (385)
. Change in Current Liabilities - Increase (Decrease):
Accounts Payable and Other Accrued Expenses - 175,578-Power Costs Recovered in Advance (10,903) '
Customer Deposits, 4,498 Net Cash Provided By Operating Activities 1,264,825 Cash Hows From Noncapital Financing Activities Miscellaneous Income -876 >
- Operating Transfers Out to Other Funds (236,113)
Operating Transfers in From Other Funds. 130,000
- Repayment of Loan From General Fund ' (250,000)
- Net Cash (Used In) Noncapital Financing Activities (355,237)
Cash Flon From Capital and Related Enancing Activities Extension and Replacement of Plant - Net of-
- Contributions Received in Aid of Construction
' (Excluding _ Capitalized Interest) (402,836)
Plant Removal Costs - - (5,761) -
Principal Payments on Bonds -(152,000)
Principal Payments on Notes (64,690)
Interest Paid - _ .
(793,658)
Operating Transfers Out to Other Funds ' (52,360).
Operating Transfers in From Other Funds 52,360 Cash Flows (Used In) Capital and Related Financing Activities (1,418,945)
See accompanying notes.
9 l
COMBINED STATEMENT OF CASil FLOWS -
ALL PROPRIETARY FUND TYPFS FOR TIIE YEAR ENDED SEPTEMBER 30,1991 CITY OF ALACIIUA, FLORIDA (Concluded) ,
Proprietary
_ Fund Type Enterprise ~
Cash Flows From Investing Activities Investments Purchased $ (2,802,647)
Investments Matured 3,053,750 Interest Income 355,591 Net Cash Provided Ily Investing Actliities 606,694 l Net Increase in Cash and Cash Equivalents 97,337 Cash and Cash Equivalents, October 1,1990 799,522 ,
l Cash and Cash Equivalents, September 30,1991 $ 896,859 i
See accompanying notes.
10
i NOTES TO FINAM.tAL STATEMENTS l CITY OF ALACIIUA, FLORIDA l
Note 1 - Summary of Significant Accounting Policies The City of Alachua, Florida (the City) is a political subdivision of the State of Florida l located in Alachua County. The legislative branch of the City is composed of a five-member elected commission. He City Commission is governed by the City Charter and by state and local laws and regulations. he City Commission is responsible for the establishment and adoption of policy. De execution of such policy is the responsibility of the Commission-appointed City Manager.
u The City's major operations include various utility services - electr' , water and wastewater as well as police protection, road and street maintenance, parks, recreation and other general government services. The City contracts with Alachua County for the Provision of fire service at a fixed cost to the City which is renegotiated annually. The ' / eases l the fire station and equipment to the County at no cost. Sanitation services are provided by a private
- _ company, but billed by the City to its customers. The City retains an administrative fee on sanitation services.
He accounting policies of the City of Alachua, Florida, conform to generally accepted accounting principles as applicable to governments. De following is a summary of the more significant accounting policies.
Reporting Entity he basic criterion for including an agency, institution, authority, or other organization in a governmental unit's reporting entity is the exercise of oversight responsibility over such entities by the governmental unit's elected officials. Oversight responsibility is defit ed to include, but is not limited to: financial interdependency; selection of governing authority; designation of management; ability to significantly influence operations; accountability for ,
fiscal matters; and other factors including special financing relationships. There are no entities over which the City exerts any type of influence and, accordingly, the accompanying general purpose financial statements include only the fund types and account groups of the City itself Fund Accounting The City's accounting records are organized and operated on a fund basis. A fund is defined as a fiscal and accounting entity, with a self-balancing set of acaunts recording all financial rescurces with all related liabilities, reserves and residual entities, or balances or changes therein, which are segregated for the purpose of carrying on specific activities or attaining certain objectives. Amounts received from or payable to other funds are shown in the accounts of an individual fund and separately presented in the accompanying general purpose financial statements until liquidated by payment or an interfund transfer.
he following fund types and account groups are used in accounting for the financial
- operations of the City.
I 11 l=
4 r
NOTES TO FINANCIAL STATEMENTS CITY OF ALACilUA, FLORIDA (Continued)
Note 1 - Summary of Significant Accounting Policies (Continued)
Fund Accounting (Concluded)
Governmental Fund Types a General Fund - to account for all financial resources not properly accounted for in another fund, a Special Revenue Fund - to account for the proceeds of specific revenue resources (other than special assessments, expendable trusts, or major capital projects) that are legally restricted to expenditures for specified purposes. He City uses this fund to account for the proceeds from the U.S. Department of Housing and Urban Development Community Development Block Grants, a Debt Service Fund - to account for the accumulation of resources and payment of general obligation bond principal and interest from these resources. The City uses the Debt Service Fund to account for the accumulation of resources and the payment of principal and interest on the Gulf Breeze and FLGFA loans.
Proprietary Fund Type a Enterprise Funds - to account for operations that are financed and operated in a manner similar to private business enterprises - where the ir. tent of the governing body is that costs of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges. The City's electric, water and wastewater utility services are accounted for in these funds.
Account Groups a ne Account Groups are used to establish account.ng control and accountability for the government's general fixed assets and general long-term debt. These account groups are not considered funds since they do not reflect available financial resources and related liabilities.
Measurement Focus The accounting and reporting treatmen; applied to the fixed assets and long-term liabilities associated with a fund are determined by its measurement focus. Governmental Fund Types ve accounted for on a " spending" or " financial flow" measurement focus. This means that only current assets and current liabilities are generally included on the balance sheet. The reported fund balance (net current assets) is considered a measure of "available spendable resources." Governmental Fund Type operating statements present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets. Accordingly, such statements are said to present a summary of sources and uses of
- available spendable resources" during a period.
Fixed assets used in Governmental Fund Type operations (general fixed assets) are accounted for in the General Fixed Assets Account Group, rather than in governmental funds, and long-term liabilities expected to be financed from Governmental Fund Types are accounted for in the General Long-Term Debt Account Group.
12 I
i I
NOTES TO FINANCIAL STATEMENTS CITY OF ALACilUA, FLORIDA (Continued)
Note 1 - Summary of Significant Accounting Policim (Continued)
Measuremer.t Focus (Concluded) ne Proprietary Fund Types are accounted for on a cost of services or " capital maintenance" measurement focus. His means that all assets and all liabilities (whether current or noncurrent) associated with its activity are included on the balance sheet. The reported fund equity (net total assets) is segregated into contributions and retained earnings components.
He Proprietary Fund Type operating statements present increases (revenues) and decreases (expenses) in net total assets.
Basis of Accounting The Governmental Fund Types are mahtained on the modined accrual basis of accounting.
Under this method of accounting, revenues are generally recognized when they become A measurable and available as net current assets. Revenues which are susceptible to accrual, i.e., being recorded when earned, include propeny and utility taxes, refuse collection fees and lot clearing and certain other fees. Expenditures are generally recorded on an accrual easis, i.e., when incurred, except as follows:
a Principal and interest on long-term debt are recognized when due, e accumulated vacation and sick pay is not recorded in the General Fund since the current amount is irrmaterial.
The Proprietary Fund Types are maintained on the accrual basis of accounting. His method of accounting relates costs and expenditures to the period in which benefits of the outlays are received. It is intended to provide an accurate matching of these benefits with associated revenues. Under the accrual basis of accounting, revenues are recognized when earned and measurable, and expenses are recognized when incurred.
Budgeting The City's procedures in preparing and adopting the annual budget are as follows:
a The City Manager is responsible for preparing a proposed operating budget for the upcoming year prior to September 20 that includes estimated revenues, proposed expenditures, and other financing sources and uses.
m Public heanngs are held to obtain taxpayer comments and suggestions. The budget is enacted through passage of a resolution, which sets spending limits by department.
m he City Manager is authorized to transfer bedgeted amounts within any department in any fund, but may not revise total departmental expenditures without the approval of the City Commission. The budgetary information for all governmental fund types in the Combined Statement of Revenues, Expenditures and Changes in Fund Balances is reported as amended.
m Budgets are adopted on a basis consistent with generally accepted accounting principles.
Appropriations lapse at the end of the year. Encumbrances are not recorded.
13
NOTES TO FINANCI AL STATEMENTS CITY OF ALACilUA, FLORIDA (Continued)
Note 1 - Summary of Significant Accounting Policies (Continued)
Budgeting (Conduded) m The budgets for governmental funds which include the General Fund, Special Revenue Funds and Debt Service Fund that were either ahpted or amended during the year by the City Commission were prepared on the same basis of accounting utilized by those specific fund types. Comparisons of budgetary data to actual are not required to be reported for proprietary fund types.
Receivables __
Customer accounts and assessments receivable are recorded at their net realizable value reduced by an allowanee for uncollectible accounts. Property taxes receivable are recorded in total, offset by deferred revenue for the amount which is not measurable and available at September 30,1991.
Inventory Inventory in the General Fund is charged to expenditures when purchased. Inventory in the Proprietary Fund Types consists of supplies held for repairs or capital improvements, plus nuclear fuel. ,
Property, Plant and Equipment and Depreciation Property, plant and equipment in the Proprietary Fund Types are recorded at historical cost or at fair market value on the date donated. Ordinary maintenance and repairs are charged to expenses as incurred.
Provision has been made for the depreciation of such property, plant and equipment using )
the straight-line method with a half-year convention. The straight line rate is computed using
~
the period of years considered as the normal service life of the property. Such rates are as follows: s Nuclear Plant and Equipment 2.7% to 3.6%
Electric Distribution Plan 2 % to 4 %
Water Plant 3% to 10%
Wastewater Plant 2.5 %
Other Equipment 10% to 20%
Construction work in progress is not depreciated until completed and placed into sen' ice.
Utility plant acquired through grants is depreciated along with other utility plant purchased or constructed.
14
NOTES TO FINANCIAL STATEh1ENTS CITY OF ALACilUA, FLORIDA (Continued) 9 Note 1 - - Summary of Significant Accounting Policies (Continued)
Property, Plant and Equipment and Depreciation (Concluded)
All other property and equipment owned by the City is reflected at cost in the General Fixed Assets Account Group and shown as an expenditure in the fund purchasing the property or equipment. Certain improvements such as streets, sidewalks and other infrastructure assets are capitalized along with other general fixed assets. No provision for depreciation is made for any general fixed assets.
Bond Discount and Issue Costs Amortization 1-The bond issue costs on the Utility Revenue Bonds of 1990 and 1986 are being amortized over the lives of the bonds using the straight-line method. The bond discounts on the Utility Revenue Bonds are being amortized over the life of the bonds using the effective interest method.
Capitalized Interest During Construction The L'ity accounts for capitalized interest during construction in accordance with Statement of Financial Accounting Standards No. 34, Capitali:ation ofInterest Costs, and Statement No. 62, Capitall:ation of Interest Cost in Situations inwhing Cenain 7hx-Etempt Borrowings and Cenain GIAs and Grants. Interest paid during 1991 in the amount of $7,178 has t,een capitalized as a cost of construction in the Proprietary Fund Type. In addition, construction-in-progress in the Proprietary Fund Type was offset by $203,375 of interest
- income. No other interest paid or payable during 1991 has been capitalized in any fund or account group.
Long-Term Liabilities
- Because of their spending measurement focus, expenditure recognition for governmental fund types is limited to exclude amounts represented by noncurrent liabilities Since they do not affect net current assets, such long-term amounts are not recognized as governmental fund type liabilities. Dey are instead reported as liabilities in the General Long-Term Debt Account Group.
Compensated Absences The City accrues accumulated unpaid vacation and sick pay when incurred, if material, in 4 the Proprietary Funds and the Genera Long-Term Debt Account Group. Amounts representing the current liability for unused annual and sick leave in governmental fund types are immaterial. Herefore, the entire liability for governmental fund types is recorded in the General Long-Term Debt Account Group.
Personnel policies allow permanent, full-time employees to accumulate a maximum of twenty-five days vacation leave and sixty days sick leave. One week of vacation time is granted if sixty days sick leave is accumulated. Employees are paid the balance of their accumulated vacation leave, in full, upon termination. Also upon termination, employees are paid the balance of their accumulated sick leave, up to a maximum of eighty hours.
15
NOTES TO FINANCIAL STATEMESTS CITY OF ALACllUA, FLORIDA (Continued)
Note 1 - Summary of Significant Accounting Policies (Continued)
Revenue Rwognition Utility revenues are recognized when customers are billed unless there has been a signincant change in meter reading rates, in that event, unbilled or deferred revenues are recorded for consistency.
Restricted grant revenues which are received, but not expended, are recorded as deferred revenues in the liability section of the balance sheet.
Property Taxes Under Florida law, the assessment of all properties and the collection of all county, municipal and school board property taxes are consolidated in the ofnces of the County Property Appraiser and County Tax Collector. De laws of the state agulating tax assessments are also designed to assure a consistent propeny valuation method state-wide. State Statutes permit municipalities to levy property taxes at a rate of up to 10.00 mills. The City's millage rate for the 1991 fiscal year was 5.00 mills.
The tax levy of the City is established by the City Commission prior to October 1 of each year and the Alachua County Propeny Appraiser in wrates the City millages into the total tax levy, which includes the County and the County ochool Board tax requirements.
All property is reassessed according to its fair market value January 1 of each year. Each assessment roll is submitted to the Executive Director of the State Department of Revenue for review to determine if the rolls meet all of the appropriate requirements of State Statutes.
All taxes are levied on November 1 of each year or as soon thereafter as the assessment roll ,
is certified and delivered to the County Tax Collector. All unpaid taxes become delinquent on April 1 following the year in which they are assessed. Discounts are allowed for early payment at the rate of 4% in the month of November,3% in the month of December,2%
in the month of January, and 1% in the month of February. The taxes paid in March are without discount.
On or prior to June I following the tax year, certificates are sold for all delinquent taxes on real property. After sale, tax certincates bear interest of 18% per year or at any lower rate bid by the buyer. Application for a tax deed on any unredeemed tax certificates may be made by the certificate holder after a period of two years. Unsold certincates are held by
- the County.
Delinquent taxes on personal propeny bear interest at 18% per year until the tax is satisfied either by seizure and sale of the property or by the five-year statute of limitations.
Unsold tax certificates were $89,876 at September 30,1991, including interest, and are offset by deferred revenue of $89,876.
16 I.
__m __ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ . . _ _ _ _ _ _ _ _ _ . . _ _ _ . _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ . _ _ - _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ - _ _ _ _ . _ h
1 NOTES TO FINANCIAL STATEMENTS CITY OF ALACllUA, FLORIDA (Continued)
Note 1 - Summary of Significant Accounting Policies (Concluded)
Total Columns on the Combined Staten ents Total columns on the combined statements are captioned " Totals (Memorandum Only)* to indicate that they are presented only to facilitate Anancial analysis. Data in these columns do not present financial position, results of operations, or cash flows in conformity with generally accepted accounting principles. Neither is such data comparable to a consolidation.
Interfund eliminations have not beca made in the aggregation of this data. The totals from 1990 are presented for the purpose of additional analysis and are not a required part of the general purpose financial statements. Certain minor reclassifications have been made to these totals to provide more meaningful comparative data.
Note 2 - Deposits and Investments All monies collected by the City are required to be deposited in accordance with the laws of the State of Florida. State Statutes authorize the City to invest in the following:
m Direct oblig tions of, or obligations guaranteed by, the U.S. Government; a interest-bearing time deposits or savings accounts in qualified iastitutions; e obligations of the Federal Farm Credit Banks; e obligations of the Federal National MortgPge Association; and a the Local Government Surplus Funds Trust Fund.
Deposits At year end, the carrylug amount of the City's deposits was $631,537 and the bank balance was $299,734. All deposits of the City are maintained in qualified public depositories. In addition, the City had $107,275 deposited with a fiscal agent as of September 30,1991, for the payment of revenue bond interest on October 1.
The Florida Security for Public Deposits Act; Chapter 280 of the Florida Statutes, provides that qualified public depositories must maintain eligible collateral having a market value equal to 50% of the average daily balance for each month of all public deposits in excess of any applicable deposit insurance held by the depository during the twelve months immediately preceding the date of any computation of the balance. As such, the depository is not required to hold collateral in the City's name nor specify which collateral is held for the City's benefit. In the event of default, the Public Deposit Security Trust Fund, as created under the laws of the State of Florida, would be required to pay the City for any deposits not covered by depository insurance or collateral pledged by the depository as previously described.
17 I
_ __ - _ - _ - - _ - - - - \
4 NOTES TO FINANCIAL STATEMEN'13 CITY OF ALACilUA,110RIDA (Continued)
- Note 2 - Deposits and Investments (Conduded)-
Investments investments are carried at cost or amortized cost. The carry amount and market value of investments owned by the City of Alachua at September 30,1991 was as follows:
Carrying Market Type of Investment Amount Value Certificates of Deposit. 5.25% - 9.50%
Interest, Varying Maturities Through October 1,1991 $ 3,936,736 $ 3,936,736
' State Board of Administration of Florida Local Government Pooled Investment Account Variable Interest Rate (6.23%
at September 30,1991) 407,664 407,664 Florida Municipal Power Agency (FMPA)
Crystal River 111 Pooled Investment Account 69, % 9 69,969 United States Treasury Bonds, $575,000 Par Value,7.625% Interest, Maturing February 15,2007 561,340 572,305 Total $ 4.975,709 $ 4,986,674 All the above investments are insured or registered, or held by the City or its agent in the City's name. He State Board of Administration's deposits in Tallahassee are maintained in an investnient pool which invests primarily in commercial paper, repurchase agreements, bankers acceptance notes and U.S. Government obligations. The FMPA account is maintained in an investment pool which invests primarily in mid-term U.S. Government obligations.
De State Board of Administration accounts are classified as " Cash and Cash Equivalents" on the balance sheets because the investments have original maturities of ninety days or less.
Note 3 - Inventory Inventory in the proprietary fund types at September 30,1991 consists of the following:
Electric Utility Supplies $ 108,167 Water / Sewer Supplies 13,117 Nuclear Fuel 53,965 Nuclear Plant Materials inventory 16,485 Total $ 191,734 18
l NOTES TO FINANCIAL STATEMENTS CITY OF ALACIIUA, FLORIDA (Continued)
Note 3 - Inventury (Conduded)
"Ite utility supplies and plant inventory are valued at cost as determined by the average unit cost method. The City's portion of nuclear fuel inventory at the Crystal River - 3 nuclear generating facility is recorded at amortized cost.
Note 4 - Detail of Property, Plant and Equipment Gmnt IPxed i Assets Account Group A summary of changes in general fixed assets for the year follows:
Ranm als Balance and Balance 10/1/90 Additions Adjustmenh 9/30/91 City Park - Stmetures and Improvements $ 15,385 $ 4,500 $ 19,885 City Hall - Building 154,750 2,875 157,625 City Hall- Equipment, Furnishings and Vehicles 66,915 1,590 68,505 Fire Station 72,169 72,169 Police Station 68,212 68.212 Rolling Green - Land and Buitdings 639,860 639,860 Rolling Green - Improvements 14,653 14,653 Parking Lots - Land 26,939 26,939 Street Paving and Sidewalks 981,564 981,564 Fire Trucks and Other Equipment 178,865 178,865 Mosquito Spraying Equipment 2,425 2,425 Land - Other 130,491 130,491 Police Department - Cars and Equipment 193,889 37,305 $- (2,000) 229,194 Streets and Roads
, Equipment 51,580 51,580 Miscellaneous 11,709 11,709 Parks,md Recreation -
Eq(unent 29,788 29,788 Physical Environment -
Equipment 33,324 1,232 34,556 Total Property, liant and Fculpment - At ~
Cost $ 2,672,518 5 47,502 $ (2,000) $ 2,718,020 19
e n.A. - , . _ s-w ,4.,. -4 ,:-: --a- *em a ._le s NOTES TO FINANCIAL STATEMENTS CITY OF ALACIIUA, FLORIDA (Continued)
Note 4 - Detall of Property, Plant and Equipment (Concluded)
Proprietary Fund Types A summary of property, plant and equipment in the proprietary fund types at September 30, 1991 follows:
Nuclear Generating Plant and Equipment - 5 507,947 Electric Distribution Plant and Equipment 4,817,079 Water Plant and Equipment 1,900,199 Sewer Plant and Equipment 3,054,860 10,280,085 (Accumulated Depreciation) (3,018,855)
Utility Plant in Service - Cost Less Accumulated Depreciation 7,261,230 Construction-in-Progress 61,870 Total Utility Plant - Cost Less Accumulated Depreciation 5 7.323,100 Nuclear generating plant and equipment represents the cost of the City's .0779% undivided interest in the Florida Power Corporation Crystal River Unit Number 3 (CR 3).
Note 5 - Long-Term Debt General Long-Term Debt The following tabulation summarizes the changes in the City's general long-term debt account group during the year enkd September 30,1591:
Balarice New (Principal Balance 9/30/90 Debt Paid) 9/30/91
-City of Gulf Breeze, Florida.
Local Government Loan Program $ - 955,000 $ 0 $ (15,000) $ 940,000 Florida Local 6.;veruna.$
Finance Authonty, Government Unit Loan Program 425,000 0 (6,086) 418,914 Chattel Mortgage:
Computer Equipment -
System 36 1,927 0 (1,927) O Compensated Absences 36,708 5,155 0 41,863 Total 5 1,418,635 $ 5,151 $ (23,013) $ 1,400,777 20
i 1
l NOTES TO FINANCIAL STATEMENTS I CrlT OF ALACIIUA, FLORIDA (Continued) l Note 5 - leng-Term Debt (Continued)
General leng-Term Debt (Continued)
City of Gulf Breeze, Florida - 14 cal Goternment lean Program On June 1,1987, the City of Alachua executed a Loan Agreement with the City of Gulf Breeze, Florida (the Administrator and Sponsor), and Sun Bank National Association, Orlando, Florida (as Trustee), to borrow $ 1,000,000 from the Sponsor's $ 100,000,000 Local Government Loan Program. The Sponsor had issued $100,000,000 Local Government Loan Program Floating Rate Demand Revenue Bonds, Series 1985B (ie Bonds) and deposited the proceeds with Sun Bank to fund the program, available to governmental entitics for financing and refinancing certain qualified projects. ;
'lhe City of Alachua used the proceeds to finance certain specified street construction and improvement projects within the corporate limits of the City. The loan is evidenced by a Governmental Unit Note which is payable solely from the City's Local Option Gas Tax revenues and Guaranteed Entitlement Revenues (the Pledged Revenuer The Loan Agreement required the establishment of the following accouu:
Loan Proceeds To receive the proceeds of the loan and disburse the project costs.
Revenue To collect the Pledged Revenues.
Sinking To accumulate sufficient monies to pay interest on the next semiannual interest date (December I and June 1), to pay principal coming due r.aually and to make required " Reserve Payments."
Reserve To accumulate monthly In2nd of the maximum annual debt service requirement, beginning at some future date.
In accordance with the Loan Agreement, money on deposit in the Revenue Account must be disbursed in the following order:
a To satisfy current debt service requirements of the note;
- to provide for the Reserve Payments, if any, whc ' due; a to the payment of any additional Parity Bonds; e to fund a reserve account equal to the maximum annual debt service requirement by the year 1996; a to the payment of any junior lien obligations; and a for any other lawful purpose.
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a NOTES TO FINANCIAL STATEMENTS ,
- CITY OF ALACIIUA, FLORIDA (Continued) l Note 5 - lang-Term Debt (Continued)
General long-Term Debt (Continued)
City of Gulf Breeze, Florida - Local Government Iman Program (Concluded) i The note is payable over 27-1/2 years with an average coupon rate of 7.729%. The following tabulation summarizes remaining interest and principal payment requirements of . ;
the note:
- Fiscal Year Ended September 30 - Principal : Interest Total
-1992 $ 15,000 $ 70,998 $ 85,998
-1993 15,000 70,112 85,112 a* 20,000 '69,043 89,043
- 19y. -20,000 67,782 37,782
.1996 ~ 20,000 66,483 86,483 1997 - 2001 125,000 308,467 433,467
--2002 - 2006 180,000 251,125 431,125
-2007 - 2011 255,090 167,513 422,513 2012 - 2015 290.000 47,644 :337,644 ;
Total $ 940,000 ' $ 1,119,167 $ 2,059,167.
Florida Local Government Finance Authority - Government Unit Loan Program On September.26l 1990, the City adopted Resolution R-90-17 authorizing the borrowing of
$425,000 from the Florida Loca! Government Finance Authority (FLGFA), Governmental .
Unit Loan Pro;; ram, to provide funds for the repayment of a $300,000 General Obligation