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For the Fiscal Year October 1, 2009 through September 30, 2010
The CAFR cover depicts before and after photographs of the City,
of Sebastian 's Collier Canal Retrofit Project completed in Fiscal
Year 2010.
Collier Canal is the primary detention area for over 50% of the
City's stormwater runoff. The canal directly discharges into the
Sebastian River, which flows into the Intracoastal Waterway and
subsequently into the Atlantic Ocean.
Over the past decade, the service life of the seawalls had reached a
critical state and started failing. Many of the bulkhead sections
along the 2.1 mile stretch of Collier Canal had failed and literally
fallen into the canal. Silt had filled in the canal and reduced water
storage capacity and compromised the water quality.
The main project elements were reconstruction and stabilization of
2.1 miles of canal bank, dredging and disposal of 30,000 cubic
yards of silt, as well as continued water quality monitoring of the
canal.
The project was permitted through St. Johns River Water
Management District at the state level, and the U.S. Army Corp of
Engineers at the federal level.
Funding of this project was made possible by the Florida
Department of Environmental Protection. Total project cost was
$4, 925,100.
Notice to proceed was issued to S.E. Cline Construction, Inc., on
March 9, 2009 and the project was completed in July 2010.
Photograph provided courtesy of:
Everlast Synthetic Products, LLC, vinyl Sheets for Seawalls.
CITY OF
SEBASTIAN, FLORIDA
Comprehensive Annual Financial Report
For the Year Ended September 30, 2010
CITY COUNCIL
Richard H. Gillmor ........................... Mayor
JimHill ................................................ Vice -Mayor
AndreaCoy ......................................... Councilmember
DonWright ........................................ Councilmember
EugeneWolff ....................................... Councilmember
Prepared By: Administrative Services Department
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INTRODUCTORY SECTION
This section contains the following subsections:
➢ Table of Contents
➢ Letter of Transmittal
➢ Certificate of Achievement for Excellence in
Financial Reporting for Fiscal Year Ended
September 30, 2009
➢ Organizational Chart
➢ List of Officials
I
CITY OF SEBASTIAN, FLORIDA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
SEPTEMBER 30, 2010
TABLE OF CONTENTS
INTRODUCTORY SECTION Page
Tableof Contents........................................................................................................................................... ii
Letterof Transmittal...................................................................................................................................... v
Certificate of Achievement for Excellence in Financial Reporting............................................................... ix
OrganizationalChart ...................................................................................................................................... x
Listof Officials.............................................................................................................................................. xi
FINANCIAL SECTION
IndependentAuditors' Report .......................................................................................................................
3
Management's Discussion and Analysis.......................................................................................................
5
Basic Financial Statements
Government -wide Financial Statements:
Statementof Net Assets..........................................................................................................................
15
Statementof Activities...........................................................................................................................
16
Fund Financial Statements:
Balance Sheet — Governmental Funds....................................................................................................
18
Statement of Revenues, Expenditures, and Changes in Fund Balances —
GovernmentalFunds...........................................................................................................................
20
Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances
of Governmental Funds to the Statement of Activities.......................................................................
22
Statement of Net Assets — Proprietary Funds.........................................................................................
23
Statement of Revenues, Expenses, and Changes in Fund Net Assets — Proprietary Funds ....................
24
Statement of Cash Flows — Proprietary Funds.......................................................................................
25
Statement of Fiduciary Net Assets — Fiduciary Funds............................................................................
27
Statement of Changes in Fiduciary Net Assets — Fiduciary Fund..........................................................
28
Notesto Financial Statements...................................................................................................................
29
Required Suunlementary Information:
Schedule of Revenues, Expenditures, and Changes in Fund Balances — Budget and
Actual— General Fund............................................................................................................................
52
Schedule of Revenues, Expenditures, and Changes in Fund Balances — Budget and
Actual — Discretionary Sales Tax Special Revenue Fund.......................................................................
53
Schedule of Revenues, Expenditures, and Changes in Fund Balances — Budget and
Actual — Riverfront Redevelopment Agency Special Revenue Fund .....................................................
54
Notes to the Required Supplementary Information — Budget Comparisons ..............................................
55
Police Officers' Pension Plan — Schedule of Contributions from the Employer and other
ContributingEntities...............................................................................................................................
56
Combining and Individual Fund Statements and Schedules
Combining Balance Sheet — Nonmajor Governmental Funds.......................................................................
60
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances — Nonmajor
GovernmentalFunds..................................................................................................................................
64
Schedule of Revenues, Expenditures, and Changes in Fund Balances — Budget and
Actual — Local Option Gas Tax Special Revenue Fund.............................................................................
68
Schedule of Revenues, Expenditures, and Changes in Fund Balances — Budget and
Actual — Recreation Impact Fee Special Revenue Fund............................................................................
69
Schedule of Revenues, Expenditures, and Changes in Fund Balances — Budget and
Actual — Stormwater Utility Special Revenue Fund..................................................................................
70
Schedule of Revenues, Expenditures, and Changes in Fund Balances — Budget and
Actual — Law Enforcement Forfeiture Special Revenue Fund...................................................................
71
11
Page
Schedule of Revenues, Expenditures, and Changes in Fund Balances — Budget and
Actual — Stormwater Utility Revenue Bonds 2003 Debt Service Fund ..................................................... 72
Schedule of Revenues, Expenditures, and Changes in Fund Balances — Budget and
Actual — Discretionary Sales Surtax Revenue Bonds 2003 Debt Service Fund ......................................... 73
Statement of Changes in Assets and Liabilities — Agency Fund.................................................................... 74
Capital Assets Used in the Operation of Governmental Funds — Comparative
Scheduleby Source.................................................................................................................................... 75
Capital Assets Used in the Operation of Governmental Funds — Schedule
byFunction and Activity ........................................................................................................................... 76
Capital Assets Used in the Operation of Governmental Funds — Schedule of Changes
byFunction and Activity ........................................................................................................................... 77
STATISTICAL SECTION (Unaudited)
Financial Trends
Net assets by Component — Last Ten Fiscal Years...................................................................................
80
Changes in Net Assets — Last Ten Fiscal Years........................................................................................
82
Fund Balances, Governmental Funds — Last Ten Fiscal Years.................................................................
86
Changes in Fund Balances, Governmental Funds — Last Ten Fiscal Years ..............................................
88
Program Revenues by Function/Program — Last Ten Fiscal Years...........................................................
90
Revenue Capacity
Tax Revenues by Source, Governmental Funds — Last Ten Fiscal Years .................................................
92
Property Tax Rates, Direct and Overlapping Governments — Last Ten Fiscal Years ...............................
93
Assessed Valuation and Estimated True Values of Taxable Property — Last Ten Fiscal Years ...............
94
Principal Taxpayers — Year 2010 and Year 2001.....................................................................................
96
Property Tax Levies and Collections — Last Ten Fiscal Years.................................................................
97
Debt Capacity
Ratios of Outstanding Debt by Type — Last Ten Fiscal Years..................................................................
98
Computation of Legal Debt Margin — September 30, 2010......................................................................
99
Direct and Overlapping Governmental Activities Debt, General Obligation Bonds —
September30, 2010..............................................................................................................................
99
Ratios of General Bonded Debt Outstanding and Legal Debt Margin — Last Ten Fiscal Years ...............
100
Pledged Revenue Coverage — Last Ten Fiscal Years................................................................................
102
Economic and Demographic Information
Demographic and Economic Statistics — Last Ten Years.........................................................................
104
Principal Employers — Year 2010 and 2001.............................................................................................
106
Operating Information
Full-time Equivalent City Government Employees by Function/Program — Last Ten Fiscal Years ........
107
Operating Indicators by Function/Program — Last Ten Fiscal Years ........................................................
108
Capital Asset Statistics by Function/Program — Last Ten Fiscal Years ....................................................
109
SINGLE AUDIT SECTION
Independent Auditors' Report on Internal Control Over Financial Reporting and on Compliance
and Other Matters Based on an Audit of Financial Statements Performed in Accordance with
Governmental Auditing Standards............................................................................................................. 113
Independent Auditors' Management Letter................................................................................................... 115
iii
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lv
C11YOF
SEBAST.LA,N
HOME OF PELICAN ISLAND
March 18, 2011
Honorable Mayor and City Council
City of Sebastian, Florida
Dear Council Members:
We are submitting the Comprehensive Annual Financial Report of the City of Sebastian, Florida for the
fiscal year ended September 30, 2010, as prepared by the City's Administrative Services department.
State law requires that every general-purpose local government publish within six months of the close of
each fiscal year a complete set of audited financial statements. This report is published to fulfill that
requirement for the fiscal year ended September 30, 2010.
Management assumes full responsibility for the completeness and reliability of the information
contained in this report, based on a comprehensive framework of internal control that is established for
this purpose. Because the cost of internal control should not exceed anticipated benefits, the objective is
to provide reasonable, rather than absolute, assurance that the financial statements are free of any
material misstatements.
Chapter 218.39, Florida Statutes requires that the financial statements of the City of Sebastian be audited
by a certified public accountant selected by the City Council. The City's independent Certified Public
Accountants, Harris, Cotherman, Jones, Price & Associates, has issued an unqualified ("clean') opinion
on the City of Sebastian's financial statements for the year ended September 30, 2010. The independent
auditors' report is located on page 3 and 4.
Management's discussion and analysis (MD&A) immediately follows the independent auditors' report
and provides a narrative introduction, overview, and analysis of the basic financial statements. The
MD&A complements this letter of transmittal and should be read in conjunction with it.
Profile of the Government
The City of Sebastian, Florida is located in Indian River County approximately midway through the east
coast of the Florida Peninsula (between Melbourne and Vero Beach) in an area known as the Treasure
Coast. It is recognized as the Home of Pelican Island, the first designated wildlife refuge in the United
States, a Millennium City, and a Tree City USA.
The City of Sebastian was first incorporated as the Town of Sebastian in 1924. In the late 1950s General
Development Corporation purchased the land from the Mackle family of Miami and began the
development of a planned community that is now the City of Sebastian. The City has a population of
22,922 living in an area of approximately 14.6 square miles. The City is empowered to levy a property
tax on both real and personal property located within its boundaries. It also is empowered by state
statute to extend its corporate limits by annexation, which it has done from time to time.
v
The City is a Florida municipal corporation with a five -member City Council. Council members serve a
two-year term. Annual elections are held on the first Tuesday following the first Monday in November
and two members are elected in even -numbered years and three members are elected in odd -numbered
years. Elections are non -partisan and at -large. Mayor and Vice Mayor are elected from among the
members of every newly seated Council at a Special meeting following the election each year. The City
has operated under a Council -City Manager form of government since 1989.
The City provides a wide range of services including general government administration, police
protection, the construction and maintenance of local roads, public works, recreational and cultural
activities, a golf course, a general aviation airport, and a building department to enforce building codes.
This report includes all funds of the City. In evaluating the City as a reporting entity, we have included
all component units for which the City Council is financially accountable. The component units have
been blended with the financial statements presented for the Primary Government because the
component unit's governing body is the same as the City Council or because the component unit
exclusively serves the City. The blended component units are the Riverfront Redevelopment Agency
and the Sebastian Police Officer's Pension Trust Fund.
The Council is required to adopt a final budget no later than the close of the fiscal year. This annual
budget serves as the foundation for the City's financial planning and control. The budget is prepared by
fund, function (e.g., transportation), and department (e.g., public works). Shifts in appropriations within
fund totals may be done administratively on the authority of the City Manager. Total fund appropriation
changes and use of contingency appropriations must be approved by the City Council.
Local Economv
The region (which includes the City of Sebastian and the surrounding unincorporated area within the
same county) has a fluctuating labor force depending on agricultural demand and a strong retirement
community. Although the labor force fluctuates, unemployment in the region steadily declined through
2006 but has significantly increased over the past four years. Retail sales and the service industries
remain the largest sectors of employment in the Sebastian area. The historical overall unemployment
rate for the area over the past ten years and the projected unemployment rate for the next ten years are
greater than that of the State of Florida. This high number indicates that the influx of residents to the
area continues to outpace job creation. According to the U.S. Census Bureau (2000), 86% of the
population age 25 or older are high school graduates and 23.1% hold a bachelor's degree or higher. The
geographical area of the City of Sebastian, just north of the Treasure Coast, houses a number of high-
tech industries including NASA and various aerospace industry -related businesses. This attracts a
workforce with a higher than average education and technical skills to the vicinity. The area median age
for 2000 was 49.2 per U.S Census Bureau and median household income for 2008 was $48,267 per the
Florida Research & Economic Database.
Lone -term Financial Planning
The voters of Indian River County in November 2003 extended the Infrastructure Sales Surtax in the
amount of $.01 per $1.00 sale for an additional fifteen years and seven months beginning in January
2004. This Infrastructure Sales Surtax is estimated to provide the City in excess of $40 million dollars
over the life of the extension for the City's emergency vehicle and capital improvement needs.
In addition, the City has funded a number of other capital projects with impact fees and has actively
pursued grant funding for some major transportation and environmental improvements. It has also
employed the use of a Community Redevelopment Agency that is funded by means of tax -increment
financing.
vi
The millage was maintained at the same 3.3456 as the prior year, although the City experienced another
sizable decline in taxable value. Construction activity in fiscal year 2010 continued to below, with just
36 permits being issued for new construction in fiscal year 2010 with a value of $6.6 million. The
decline is primarily attributed to the slowdown of the housing market.
General Fund unassigned fund balance and amounts committed by the financial policies resolution
based on 25% of the general fund expenditures budget, were 45.7% of the general fund expenditures
budget. The City has been steadfast and refused to spend down these balances due to uncertainty about
the future due to the slow down of building activity and because the City understands reliance on
accumulated fund balances to fund operating expenditures is not a prudent fiscal strategy. To this end,
the budget for next year incorporates reductions in operating expenditures and plans for no reduction of
fund balances.
Maior Initiatives
Administration — There were several significant initiatives during the past fiscal year. Through request
for proposals, the City selected and employed a new financial advisor that assisted with the payoff and
financing of a bank note to allow for additional road paving work and also employed a new investment
advisor that is assisting with restructuring the investment holdings. In addition, collective bargaining
agreements were negotiated that reduced the contract periods to one year, which is considered important
to the City's ability to have flexibility in controlling personnel costs during these difficult economic
times. Planning also started on other projects, including a detailed study of property values and
evaluation of the appropriate amounts of insurance coverage, an organizational review of the City
garage operations, plus an upgrade on the video broadcasting capabilities for public meetings.
Stormwater - The main focus of stormwater effort expended for the past fiscal year has continued to be
on the City's Stormwater Management Program, including capital projects, maintenance, citizen
response and education, and forward planning. In fiscal year 2007, City began a program to upgrade the
current swale system by installing '/4 rounds. The City also started outsourcing the swale and ditch
maintenance work to enable City crews to focus on different stormwater maintenance practices. During
fiscal year 2010, a significant project to replace the canal walls along Collier Creek was accomplished.
Traffic & Transportation — The City continues working on a long-term street -resurfacing program for
the next 10 to 15 years. City administration will also continue to program funding for streetscape
projects to help maintain public safety and beautification efforts. In addition, capital improvement
programming for sidewalk installation throughout the City will continue for both the short and long term
as funding and resources permit. $1,250,000 of additional paving funds was provided in February 2010
by means of refinancing the outstanding bank note.
Airport - The Sebastian Municipal Airport's infrastructure is being developed to attract economic
development opportunities that will stimulate the business climate and create jobs in the community.
The current Master Plan serves as the guiding document for airport planning. Land leases are a primary
source of airport revenues and over 150 acres of property is available for lease, for both aviation and
non -aviation businesses. Also important are sales from a self -serve fueling facility.
The Airport's limited resources continue to be leveraged by aggressively seeking and obtaining grants
available from the Florida Department of Transportation (FDOT) and Federal Aviation Administration
(FAA) to provide the funding needed to develop the necessary infrastructure. Recent improvements
include adding a hangar and constructing an access road. These and other ventures will help attract
business to the Airport and thereby improve the Airport and City financial positions.
vii
Public Safety — The Police Department continues to provide a Community Police Officer who
participates in community events and offers special services, such as child safety seat inspections, youth
safety talks, neighborhood safety meetings and school security surveys. The City continues to sponsor
the School Resources Officer Program at the two elementary schools located within the City. In
addition, the Sebastian Police Department K-9 Unit has been increased to enable this capability on every
work shift. The K-9 Unit became possible as a result of numerous charitable efforts in the community.
It is effective in assisting officers with narcotics detection, location of missing persons and tracking
criminal suspects more expeditiously. Road Patrol and Special Operations continue to serve the
community by patrolling the city to deter crime and maintain the community policing philosophy.
Culture/Recreation — Parks and Recreation completed the dog park and made renovations to the
recreational facilities at Schumann Park. It also initiated plans to place a canopy over part of the
children's splash park and to build an office facility at the skate park. During the year, the City Council
conducted a review of proposed projects in the community redevelopment area and reaffirmed some
major capital projects that had been previously defined in the capital improvements program. With
substantial grant funding, the City was able to acquire riverfront properties that will be renovated and
developed as a "working waterfront" concept, which is expected to have a positive impact on the area.
Awards and Acknowledgements
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a
Certificate of Achievement for Excellence in Financial Reporting to the City of Sebastian for its
comprehensive annual financial report for the fiscal year ended September 30, 2009. The Certificate of
Achievement is a prestigious national award -recognizing conformance with the highest standards for
preparation of state and local government financial reports. In order to be awarded a Certificate of
Achievement, a government must publish an easily readable and efficiently organized comprehensive
annual financial report. This report must satisfy both U.S. generally accepted accounting principles and
applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. We believe that our current
comprehensive annual financial report continues to meet the Certificate of Achievement Program's
requirements and we are submitting it to the GFOA to determine its eligibility for another certificate.
The preparation of this report would not be possible without the dedicated service of the Administrative
Services department staff. Their efforts toward improving the accounting and financial reporting
systems has led to the improved quality of information reported to the City Council, State and Federal
agencies and the citizens of the City of Sebastian. We sincerely appreciate their contributions.
y submitted,
City Manager
Kenneth W. Killgore
Director of Finance
viii
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Sebastian
Florida
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
September 30, 2009
A Certificate of Achievement for Excellence in Financial
Reporting is presented by the Government Finance Officers
Association of the United States and Canada to
government units and public employee retirement
systems whose comprehensive annual financial
reports (CAFRs) achieve the highest
standards in government accounting
and financial reporting.
President
Executive Director
ix
CITY OF SEBASTIAN, FLORIDA
ORGANIZATIONAL CHART
CITY
CLERK
I
POLICE
�► ADMINISTRATION
ROAD PATROL
CODE
~�
ENFORCEMENT
INVESTIGATIONS
SUPPORT
SERVICES
DISPATCH I
CITIZENS OF
SEBASTIAN
CITY COUNCIL
CITY
MANAGER
ADMINISTRATIVE
SERVICES
MANAGEMENT
~� INFORMATION SYSTEMS
_I GROWTH MANAGEMENT
BUILDING DEPARTMENT
�► GOLF COURSE
�► AIRPORT
BOARDS &
COMMISSIONS
CITY
ATTORNEY
I
PUBLIC WORKS
ROADS &
MAINTENANCE
PARKS &
RECREATION
CENTRAL GARAGE
CEMETERY
FACILITIES
MAINTENANCE
STORMWATER
X
CITY OF SEBASTIAN, FLORIDA
City Manager
City Clerk
City Attorney
DEPARTMENT HEADS:
Police Chief
Administrative Services Director
Finance Director
MIS Director
Public Works Director
Growth Management Director
Building Official
Golf Course Director
Airport Director
CITY OFFICIALS
AL MINNER
SALLY A. MAIO, MMC
ROBERT GINSBURG
MICHELLE MORRIS
DEBRA KRUEGER
KENNETH W. KILLGORE
FRANK LOSARDO
JERRY CONVERSE
REBECCA GROHALL
WAYNE ESELTINE
GREG GARDNER
JOSEPH GRIFFIN
Xl
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xii
FINANCIAL SECTION
This section contains the following subsections:
➢ Independent Auditor's Report
➢ Management's Discussion and Analysis
➢ Government -wide Financial Statements
➢ Fund Financial Statements
➢ Notes to Financial Statements
➢ Required Supplementary Information
➢ Combining and Individual Fund Statements
and Schedules
1
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Harris, Cotherman,
Jones, Price & Associates
Certified Public Accountants - Chartered
5070 North Highway AlA, Suite 250
Vero Beach, FL 32963
Tel 772.234.8484
Fax 772.234.8488
Independent Auditors' Report
Honorable Mayor and Members of City Council
City of Sebastian
Sebastian, Florida
We have audited the accompanying financial statements of the governmental activities, the business -type
activities, the aggregate discretely presented component units, each major fund, and the aggregate
remaining fund information of the City of Sebastian, Florida (the "City") as of and for the year ended
September 30, 2010, which collectively comprise the City's basic financial statements as listed in the
table of contents. These financial statements are the responsibility of the City of Sebastian, Florida's
management. Our responsibility is to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing Standards
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 consideration of internal control over financial reporting as a basis for
designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the City's internal control over financial reporting. Accordingly we
express no such opinion. An audit also includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements, assessing the accounting principles used and the
significant estimates made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the
financial position of the governmental activities, the business -type activities, each major fund, and the
aggregate remaining fund information of the City as of September 30, 2010, and the respective changes in
financial position and cash flows, where applicable, thereof for the year then ended in conformity with
accounting principles generally accepted in the United States of America.
In accordance with Government Auditing Standards, we have also issued our report dated February 24,
2011 on our consideration of the City's internal control over financial reporting and on our tests of its
compliance with certain provisions of laws, regulations, contracts and grant agreements and other matters.
The purpose of that report is to describe the scope of our testing of internal control over financial
reporting and compliance and the results of that testing, and not to provide an opinion on the internal
control over financial reporting or on compliance. That report is an integral part of an audit performed in
accordance with Government Auditing Standards and should be considered in assessing the results of our
audit.
The Management's Discussion and Analysis and the required supplemental information, as listed in the
table of contents, are not a required part of the basic financial statements but are supplemental
information required by accounting principles generally accepted in the United States of America. We
have applied certain limited procedures which consisted principally of inquiries of management regarding
"Providing Vision and Direction to our Clients"
Member AICPA Member AICPA Division For CPA Firms Member FICPA
Private Companies Practice Section
Harris, Cotherman,
Jones, Price & Associates
Certified Public Accountants - Chartered
Honorable Mayor and Members of City Council
City of Sebastian
Sebastian, Florida
Page two
the methods of measurement and presentation of the required supplementary information. However, we
did not audit the information and express no opinion on it.
Our audit was conducted for the purpose of forming an opinion on the financial statements that
collectively comprise the City's basic financial statements. The introductory section, combining and
individual fund financial statements, the capital assets used in the operation of government funds, and
statistical tables are presented for purposes of additional analysis and are not a required part of the basic
financial statements. The combining and individual fund financial statements, the budgetary
comparisons, capital asset schedules and other financial schedules have been subjected to the auditing
procedures applied in the audit of the basic financial statements and, in our opinion, are fairly stated in all
material respects in relation to the basic financial statements taken as a whole. The introductory section
and statistical tables have not been subjected to the auditing procedures applied in the audit of the basic
financial statements and, accordingly, we express no opinion on them.
The accompanying schedule of expenditures of federal awards and state financial assistance is presented
for purposes of additional analysis as required by the U.S. Office of Management and Budget Circular A-
133, the Florida Single Audit Act and Chapter 10.550, Rules of the Auditor General, and is also not a
required part of the basic financial statements of the City of Sebastian, Florida. Such information has
been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our
opinion, is fairly stated, in all material respects, in relation to the basic financial statements taken as a
whole.
&q,a,� 1=��
Vero Beach, Florida
February 24, 2011
4
MANAGEMENT'S DISCUSSION AND ANALYSIS
The City of Sebastian's (the "City") discussion and analysis is designed to (a) assist the reader in focusing on
significant financial issues, (b) provide an overview of the City's financial activity, (c) identify changes in the
City's financial position, (d) identify any material deviations from the financial plan, and (e) identify individual
fund issues or concerns.
Since the Management's Discussion and Analysis (MD&A) is designed to focus on the current years activities,
resulting changes and currently known facts, please read it in conjunction with the Transmittal Letter (beginning
on page v) and the City's financial statements (beginning on page 15).
HIGHLIGHTS
Financial Highlights
• The assets of the City exceeded its liabilities at the close of the fiscal year 2010 by $52,632,005 (net
assets). Of this amount, $3,546,671 (unrestricted net assets) may be used to meet the City's on -going
obligations to citizens and creditors.
• The city's total net assets increased by $2,277,138 resulting from an increase of $2,140,287 from
governmental activities and $136,851 from business -type activities
• Governmental funds reported a combined ending fund balance of $14,369,442, a decrease of $786,090 in
comparison with the prior year. Approximately 15% of this amount, $2,164,910 is unassigned and
available for spending, a decrease of $160,062 from fiscal year 2009 due to less property tax revenue.
• The golf course and airport enterprise funds reported higher deficits in unrestricted net assets. With no
longer having debt service payments, it is expected the golf course will be able to reduce that deficit. The
airport deficit is the result of investment in capital assets that will ultimately be beneficial. The building
enterprise fund is using accumulated net assets to sustain services until construction activity increases.
USING THIS ANNUAL REPORT
The annual report consists of a series of financial statements. The Statement of Net Assets and the Statement of
Activities (on pages 15, 16, and 17) provide information about the activities of the City as a whole and present a
longer -term view of the City's finances. Fund financial statements begin on page 18. For governmental
activities, these statements tell how these services were financed in the short term as well as what remains for
future spending. Fund financial statements also report the City's operations in more detail by providing
information about the City's most significant funds. The remaining statements provide financial information
about activities for which the City acts solely as a trustee or agent for the benefit of those outside of the
government.
Reporting the City as a Whole
Our analysis of the City as a whole begins on page 15. One of the most important questions asked about the
City's finances is, "Is the City as a whole better off or worse off as a result of the year's activities?" The
Statement of Net Assets and the Statement of Activities report information about the City as a whole and about its
activities in a way that helps answer this question. These statements include all assets and liabilities using the
accrual basis of accounting, which is similar to the accounting used in most private -sector companies. All of the
current year's revenues and expenses are taken into account regardless of when cash is received or paid. These
two statements report the City's net assets and changes in them. You can think of the City's net assets — the
difference between assets and liabilities — as one way to measure the City's financial health, or financial position.
Over time, increases or decreases in the City's net assets, is one indicator of whether its financial health is
improving or deteriorating. You will need to consider other nonfinancial factors, however, such as changes in the
City's property tax base and the condition of the City's roads, to assess the overall health of the City.
In the Statement of Net Assets and the Statement of Activities, we divide the City into two kinds of activities:
• Governmental activities — Most of the City's basic services are reported here, including the police, public
works, parks and recreation, and general administration. Taxes, franchise fees, and state shared revenue
finance most of these activities.
Business -type activities — The City charges a fee to customers to help it cover all or most of the cost of
certain services it provides. The City's Golf Course, Airport, and Building operations are reported here.
Fund Financial Statements
Our analysis of the City's major funds begins on page 18. The fund financial statements provide detailed
information about the most significant funds — not the City as a whole. Some funds are required to be established
by State law and by bond covenants. However, the City Council establishes many other funds to help it control
and manage money for particular purposes or to show that it is meeting legal responsibilities for using certain
taxes, grants, and other money (like the local option gas tax and infrastructure sales surtax (a.k.a. Discretionary
Sales Tax)).
Governmental Funds
Most of the City's basic services are reported in governmental funds, which focus on how money flows into and
out of those funds and the balances left at year-end that are available for spending. These funds are reported using
an accounting method called modified accrual accounting, which measures cash and all other financial assets that
can readily be converted to cash. The governmental fund statements provide a detailed short-term view of the
City's general government operations and the basic services it provides. Governmental fund information helps
you determine whether there are more or fewer financial resources that can be spent in the near future to finance
the City's programs. We describe the relationship (or differences) between governmental activities (reported in
the Statement of Net Assets and the Statement of Activities) and governmental funds in reconciliations at the
bottom of the fund financial statements.
The City maintains fifteen individual governmental funds. Information is presented separately in the
governmental fund balance sheet and in the governmental fund statement of revenues, expenditures, and changes
in fund balances for the general fund, discretionary sales tax special revenue fund, riverfront redevelopment
special revenue fund, transportation improvements capital project fund and stormwater utility improvements
capital project fund, all of which are considered to be major funds. Data from the other ten governmental funds
are combined into a single, aggregated presentation. Individual fund data for each nonmajor governmental fund is
provided in the form of combining statements beginning on page 60.
Annual budgets are adopted for all governmental funds except the capital project funds, which are approved on a
"life of the project basis", and the permanent fund, which is not budgeted. The budgetary comparison statements
have been provided for all governmental funds except capital project funds to demonstrate compliance with the
budget.
The basic governmental fund financial statements can be found on pages 18-22 of this report.
R
Proprietary Funds
When the City charges customers for the services it provides — whether to outside customers or to other units of
the City — these services are generally reported in proprietary funds. Proprietary funds are reported in the same
way that all activities are reported in the Statement of Net Assets and the Statement of Activities. In fact, the
City's enterprise funds (a component of proprietary funds) are the same as the business -type activities we report
in the government -wide statements but provide more detail and additional information, such as cash flows, for
proprietary funds.
The basic proprietary fund financial statements can be found on page 23-26 of this report.
Fiduciary Funds
The City is the trustee, or fiduciary, for the Police Officers' Pension Plan. The City's fiduciary activities are
reported in separate Statements of Fiduciary Net Assets and Changes in Fiduciary Net Assets on page 27 and 28.
We exclude these activities from the City's other financial statements because the City cannot use these assets to
finance its operations. The City is responsible for ensuring that the assets reported in these funds are used for
their intended purposes.
The City holds deposits for various individuals and businesses for contract performance that are then returned
when the contract has been completed. These deposits are accounted for in an Agency fund, where assets equal
liabilities.
Notes to the Financial Statements
The notes provide additional information that is essential to a full understanding of the data provided in the
government -wide and fund financial statements. The notes to the financial statements can be found on pages 29-
50 of this report.
Other Information
In addition to the basic financial statements and accompanying notes, this report also presents certain required
supplementary information concerning the City's major funds budget and actual comparison and progress in
funding its obligation to provide pension benefits to its employees. Required supplementary information can be
found on pages 51-56 of this report.
THE CITY AS A WHOLE
Financial Analysis of the City as a Whole
The City's combined net assets increased $2.2 million from $50.4 million to $52.6 million or 4%. Looking at the
net assets and net revenues of the governmental and business -type activities, the increase occurred in both the net
assets of governmental -type activities and the business -type activities. Our analysis focuses on net assets (Table
1) and changes in net assets (Table 2) of the City's governmental and business -type activities.
7
GOVERNMENT -WIDE STATEMENTS
Statement of Net Assets
The following table reflects the condensed Statements of Net Assets:
Current and other assets
Capital assets
Total assets
Non -current liabilities
Other liabilities
Total liabilities
Net assets:
Invested in capital assets,
net of related debt
Restricted
Unrestricted
Total net assets
Table 1
Statements of Net Assets
as of September 30, 2010 and 2009
(in thousands)
Governmental Activities
2010
2009
$ 15,664
$
17,084
42,378
38,673
$ 58,042
$
55,757
$ 15,517
$
14,782
940
1,530
$ 16,457
$
16,312
Business -type Activities
2010
2009
$ 166
$
692
11,390
11,018
$ 11,556
$
11,710
$ 232
$
534
277
265
$ 509
$
799
Total Primary Government
2010
2009
$ 15,830
$
17,776
53,768
49,691
$ 69,598
$
67,467
$ 15,749
$
15,316
1,217
1,795
$ 16,966
$
17,111
$ 28,939
$ 26,745
$ 11,390 $ 10,726 $
40,329 $
37,471
8,757
8,197
- 98
8,757
8,295
3,889
4,502
(343) 87
3,546
4,589
$ 41,585
$ 39,444
$ 11,047 $ 10,911 $
52,632 $
50,355
For more detail information see the Statement of Net Assets on page 15.
Total net assets of the governmental activities increased from $39.445 million to $41.585 million. Total net assets
for business -type activities increased from $10.911 million to $11.047 million.
The increase in governmental activities capital assets is due to projects that were completed during the period. The
decrease in governmental activities non -current liabilities is due to normal amortization of the long-term debt.
The decrease in unrestricted net assets is mainly due to the corresponding increase in restricted net assets caused
from investment in capital assets.
The increase in net assets for business -type activities is primarily due to the increase in capital assets funded by
the Federal Aviation Administration and the Florida Department of Transportation for the City's municipal
airport.
8
The following table shows the revenue and expenses of the total primary government.
Table 2
Changes in Net Assets
For the Fiscal Years Ended September 30, 2010 and 2009
(in thousands)
REVENUES
Program revenues:
Charges for services
Operating grants and contributions
Capital grants and contributions
General revenues:
Property taxes
Other taxes
Intergovernmental
Other
Total revenues
EXPENSES
General government
Public safety
Physical environment
Transportation
Economic environment
Culture and recreation
Golf Course
Airport
Building
Interest and fiscal charges
Total expenses
Change in net assets before transfers
Transfers
Increase in net assets
Net assets - October 1, 2009
Net assets - September 30, 2010
Governmental
Activities
2010 2009
Business -type
Activities
2010 2009
Tota 1 Prima ry
Government
2010 2009
$ 1,266
$ 1,291 $
1,959 $
2,205
$ 3,225
$ 3,496
210
228
-
-
210
228
3.179
1,865
905
1,357
4,084
3,222
4,164
4,802
-
-
4,164
4,802
4,765
4,670
-
-
4,765
4,670
1,825
1,821
-
-
1,825
1,821
1,523
1,729
218
6
1,741
1,735
16,932
16,406
3,082
3,568
20,014
19,974
3,309
3,170
5,721
5,421
1,948
1,348
1,864
3,438
136
167
1,240
1,073
566
730
14,784
15,347
2,148
1,059
(7)
-
2,141
1,059
39,444
38,385
$ 41,585 $
39,444
1,388
1,477
1,068
1,080
497
534
2,953
3,091
129
477
7
-
136
477
10,911
10,434
$ 11,047
$ 10,911
3,309
3,170
5,721
5,421
1,948
1,348
1,864
3,438
136
167
1,240
1,073
1,388
1,477
1,068
1,080
497
534
566
730
17,737
18,438
2,277
1,536
2,277 1,536
50,355 48,819
$ 52,632 $ 50,355
Overall the total revenues increased $40 thousand from the previous year but only as a result of an increase in
capital grants that more than offset declines in almost every other revenue source categories. The total expenses of
all programs decreased by 4.0% ($701 thousand) because of a reduction in transportation expenses. Our analysis
below separately considers the operations of governmental and business -type activities.
Governmental Activities
Governmental activities revenues exceed expenses by $2.148 million. Total revenues increased approximately
$526 thousand from the previous year. The increase was primarily due to receiving capital grant proceeds. More
revenues were received in other taxes but less was received in other categories, particularly property taxes. Total
expenses decreased $563 thousand from the previous year. The largest decreased in spending was in the category
of transportation.
Z
The following is a graphic illustration of the comparison for governmental activities revenue and expenses.
Governmental Activities Comparison
for Fiscal Year 2010 and Fiscal Year 2009
6,000
0 5,000 �-
o 4,000 - - - -
c 3,000
Q F. 2000,
1,000 - hA
-
rs
c� Oxs OAS ,des ,des xa� Oe epx ety e�x °p eft op eb<
est°t0
s to a�aQ�'xa` °Qem p<he�a�e�p�`het�;�ooc w° e�`�°aa sQ° e�.n�°aa�e°`e�xet�a
G�at� OQ G Q `a�ec� p'eaeta ��sea� Soa°�vc`<J�eascly 11I
Revenue/Expense types
02010 02009
Business -type Activities
Revenues of the City's business -type activities (see Table 2) decreased $486 thousand primarily because of
capital grants received by the Airport in the prior year. Expenses fell by 4.5% for all the City's business -type
activities, with reductions in charges by General Fund being the primary cause of expenses for the Building
Enterprise and Airport expenses declining by 6.9% and 1.1% respectively; Golf Course expenses declined by
6.0% due to reductions in personnel costs, savings by rebidding the groundskeeping service contract and a
reduction in rent paid to the Airport. The Building Enterprise has been reduced to minimal staffing in order to
preserve it's cash reserves until the economy and building activity resumes. The Golf Course has also minimized
staffing and operating expenses until it made the final debt service payment and until it sees an improvement in
revenue, which is anticipated with better weather and an improved economy. The City's Municipal Airport
enjoys a continued interest by the Florida Department of Transportation -Aviation Section and Federal Aviation
Administration to upgrade the airport facilities as evidenced by repeated support via grant funding.
Following is a graphic comparison of the City's business -type activities.
Business -Type Activities Comparison
for Fiscal Year 2010 and Fiscal Yeal 2009
2,500
2,000
o
.. o
1,500
o �
E r
Q F"
o—
1,000 -
500
sees `eats � a°e eases
t°i rat�e5Se 5 G °`Se ¢�Q
G o
G �,o
Revenue/Expense types
I02010 v2009
oreeases S%e�4eases
01 Q'J,�a
10
FINANCIAL ANALYSIS OF THE CITY'S FUNDS
As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance -related legal
requirements.
Governmental Funds
The focus of the City's governmental funds is to provide information on near -term inflows, outflows, and
balances of spendable resources. Such information is useful in assessing the City's financing requirements. In
particular, unassigned fund balance may serve as a useful measure of a government's net resources available for
spending at the end of the fiscal year.
As the City completed the fiscal year, its governmental funds (as presented in the balance sheet on pages 18-19)
reported a combined fund balance of $14.4 million, which is a decrease of $0.8 million from the prior year of
$15.2 million. Approximately 15.1% of this total amount ($2.2 million) constitutes unassigned fund balance,
which is available for spending at the City's discretion. The remainder of fund balance is classified as
nonspendable ($1.2 million), restricted ($7.9 million), committed ($3.1 million) or assigned ($.03 million).
The general fund is the chief operating fund of the City. At the end of the fiscal year, unassigned fund balance of
the general fund was $2,164,910, while total fund balance was $5,612,399. As a measure of the general fund's
liquidity, it may be useful to compare both unassigned fund balance and total fund balance to total fund
expenditures. Unassigned fund balance represents 20 percent of total general fund expenditures, while total fund
balance represents 51 percent of that same amount.
The fund balance of the City's general fund decreased by $155,715 during the current fiscal year. Key factors in
this reduction are as follows:
• Property tax revenues decreased by $542,402 due to reductions in taxable property values.
• Fines increased due to collections of code enforcement fines.
• Investment earnings decreased $39,872 due to lower rates of return.
• Contributions and donations decreased $15,020 because of unusually large contributions the prior year.
• Public utility taxes increased $95,592 and franchise fees decreased $98,561.
• All other revenues decreased by $4,051.
• Transfers in from other Funds decreased $56,650 because of higher than normal transfers the prior year.
• Expenditures decreased $1,033,314 due to reductions in employees and cuts in other operating accounts.
The discretionary sales tax revenue special revenue fund has a total unreserved and undesignated fund balance
of $1,094,095. The increase from the $673,676 total fund balance of the prior year is mainly due to transfers made
back to this fund from previously funded projects that ended up being funded by grants.
The riverfront redevelopment special revenue fund has an unreserved and undesignated fund balance of
$682,591. The decrease from the $984,638 total fund balance of the prior year is mainly due to the required
matching portion to grants received for the purchase of certain properties on the riverfront.
The transportation improvements capital project fund has a total fund balance of $488,988, all of which is
encumbered or reserved for transportation related construction such as roads, intersections and sidewalks.
The stormwater utility improvements capital project fund has a total fund balance of $157,471, all of which is
reserved for stormwater capital projects. The decrease from the $2,080,225 total fund balance of the prior year is
due to large expenditures made on the stormwater capital project to make improvements to Collier Canal.
11
Proprietary Funds
The City's proprietary funds provide the same type of information found in the government -wide financial
statements, but in more detail.
The total net assets of the golf course fund at the end of the fiscal year amounted to $331,000, while the
unrestricted net assets (deficit) amounted to ($335,947). Compared to the prior year in the same category, net
assets are $46,603 less than the prior year, while the unrestricted net assets has a decrease of $175,347 from the
prior year. This is mainly due to the use of funds for the final payment on long-term debt. Detailed golf course
net assets information is presented on page 23.
The total net assets of the airport fund at the end of the fiscal year amounted to $10,190,162, while the
unrestricted net assets (deficit) amounted to ($525,184). Compared to the prior year in the same category, net
assets have increased by $313,253 while the unrestricted net assets decreased $135,816. The decrease in
unrestricted net assets is mainly due to the construction of airport capital projects.
The total net assets of the building fund at the end of the fiscal year amounted to $526,202, while the unrestricted
net assets amounted to $518,791. The building fund continues to experience operating losses, as a result of the
slowdown in activity and drop in collections of building permit fees.
Other factors concerning the finances of these three funds have already been addressed in the discussion of the
City's business -type activities.
Budgetary Highlights
Over the course of the fiscal year, the City Council revised the City budget four times. These budget amendments
fall into three categories. The first category includes amendments and supplemental appropriations that were
approved shortly after the beginning of the year and reflect fund balances carried over from the prior fiscal year to
reappropriate transfers to cover certain capital projects. The second category includes adjustments for
unanticipated revenues. The third category includes supplemental appropriations to cover unanticipated items or
costs that were in excess of budgeted amounts. The main components of the increase are as follows:
• $715,923 supplemental appropriation to the Discretionary Sales Tax, Recreation Impact Fee and
Stormwater Utility Funds to cover transfers for capital projects that were carried forward from the prior
fiscal year.
• $28,329 supplemental appropriation for proceeds from a JAG Grant for equipment purchases.
• $3,179 supplemental appropriation to the Law Enforcement Forfeiture Fund for expenditures on vehicle
towing charges and drug investigation monies.
• $10,000 supplemental appropriation to the Golf Course for an emergency purchase of a reconditioned
fairway cutting unit.
• $2,349,006 supplemental appropriation to the Local Option Gas Tax Fund related to the pay off of the
former bank note and to establish appropriations necessary for the new bank note.
• $281,174 reduction to the Discretionary Sales Tax Fund to reflect the cancellation of a project.
• $16,350 supplemental appropriation to the Recreation Impact Fee Fund for construction of a public park
at the Airport and for fencing at the Dog Park and Barber Street Sports Complex.
• $6,400 supplemental appropriation to the Riverfront Redevelopment Fund to complete the Yacht Club
Finger Piers project.
• $23,636 supplemental appropriation for a project related to the Schumann Park restrooms.
• $134,852 and $149,082 supplemental appropriations for insurance premiums received from the State and
transferred to the Police Pension Plan and to fund additional required employer contributions to the Police
Pension Plan.
• $85,850 supplemental appropriations to cleanup transfer accounts in several Special Revenue Funds for
differences in amounts budgeted and expended toward projects during the year.
12
During the fiscal year, total general fund actual revenues were less than final amended budgetary estimates and
total general fund actual expenditures were less than the final amended budgetary estimates. The shortfall in
anticipated revenues was mainly due to a decline in franchise fees received from Florida Power and Light
Company. Lower than anticipated investment earnings also contributed to the shortfall. A positive overall
variance on expenditures resulted in a lower draw on existing fund balances than had been anticipated.
CAPITAL ASSET AND DEBT ADMINISTRATION
Capital Assets
At the end of fiscal year 2010 the City had $80,942,105 invested in a broad range of capital assets, including land,
police and public works equipment, buildings, park facilities, roads, bridges, and stormwater drainage structures.
This amount represents a net increase (including additions and deductions) of $6,846,603, or 9.2%, over last year.
The following table illustrates the changes in capital assets. See page 40 and page 41 in the notes to the financial
statements for detailed changes in capital assets.
Table 3
Governmental
Business -type
Activities
Activities
Totals
2010
2009
2010
2009
2010
2009
Land $
8,007,437 $
5,699,045
$ 9,060 $
9,060
$ 8,016,497 $
5,708,105
Buildings
12,061,711
11,284,488
5,083,230
5,082.120
17,144,941
16,366,608
Improvements
5,738,546
5,704,686
1,942,229
1,940,103
7,680,775
7,644,789
Equipment
7,742,063
7,784,213
1,033,439
1,062,333
81775,502
8,846,546
Infrastructure
30,891,580
25,125,625
7,477,976
6,237,799
38,369,556
31.363,424
Construction -in
Progress
951,144
3,958,971
3,690
207,059
954,834
4,166,030
Totals $
65,392,481 $
59,557,028
$ 15,549,624 $
14,538,474
$ 80,942,105 $
74,095,502
Governmental activities had the following major increases during the fiscal year:
• An increase in land mainly due to the purchase of property at the riverfront.
• An increase in buildings mainly due to the purchase of a building at the riverfront.
• An increase in infrastructure mainly due to making improvements to Schumann Park and other
recreational facilities.
Business -type activities had the following major increase during the fiscal year:
• An increase in infrastructure mainly due to the construction on an access road.
Debt
On September 30, 2010, the City had $13,449,000 in bonds and notes outstanding versus $13,421,679 on
September 30, 2009 — as shown in the table on the following page:
The slight increase in debt is attributable to the retirement of debts and the issuance during the year of a note. The
Infrastructure Sales Surtax Revenue Bonds, Series 2003 and Series 2003A and the Stormwater Utility Revenue
Bonds, Series 2003 were initially insured by AAA rated insurance agencies and rated AAA, which is the highest
rating given by rating agencies. The City's Recreational Facilities Improvement and Refunding Revenue Bonds,
Series 2001 received a AAA rating from Standard & Poor's. However, ratings on the insurance agencies have
since been downgraded. All of the City's other debt, primarily notes and a capital lease, are not rated. Other
obligations of the City include accrued vacation pay and sick leave.
Additional information on the City's long-term debt can be found on pages 43 through 45 in the notes to the
financial statements.
13
Governmental
Activities
2010 2009
Infrastructure sales surtax revenue
bonds, Series 2003
$ 5,655,000
Infrastructure sales surtax revenue
bonds, Series 2003A
1,325,000
Stormwater utility revenue bonds,
Series 2003
4,055,000
Notes payable (backed by local
option gas tax)
2,414,000
Recreational facilities
improvements and refunding
revenue bonds, series 2001
-
Totals
$ 13,449,000
Table 4
$ 6,255,000 $
1,4 70,000
4,315,000
1,089,203
Business -type
Activities Totals
2010 2009 2010 2009
$ - $ 5,655,000 $ 6,255,000
1,325,000 1,470,000
4,055,000 4,315,000
2,414,000 1,089,203
292,476 - 292,476
$ 13,129,203 $ - $ 292,476 $ 13,449,000 $ 13,421,679
ECONOMIC FACTORS AND NEXT YEAR'S BUDGETS AND RATES
The City's elected and appointed officials considered many factors when setting the fiscal year 2011 budget, tax
rates, and fees that will be charged for the business -type activities. One of those factors is the economy.
Sebastian's local economy consists largely of retail and service industries. Less than one percent is devoted to
industrial activities. Construction of new homes is the largest single business in the area. Some of the largest
retail stores include Publix Supermarket and Wal-Mart Stores, Inc.° The Indian River County unemployment rate
in 2010 was 15.4% up from 14.1 % in the previous year. This is analogous to the economic slowdown being
experienced throughout the state and nation. Again in fiscal year 2010, the city experienced a major reduction in
property value (14.13% decrease) and a small decline in new construction permits (from 58 to 36). The low
number of new construction permits reflects the state and national trend and is consistent with the overall housing
market.
These indicators were taken into account when adopting the General Fund budget for fiscal year 2011. Amounts
available for appropriation in the General Fund budget are $10,454,340, a decrease of 3.3% from the original
fiscal year 2010 budget of $10,809,831. Uncertainty about the low amount of building activity and concern about
additional measures that may be enacted by the State to limit revenues and spending has caused the City to limit
spending. The City has determined that it should continue to proceed cautiously.
The Golf Course experienced some decrease in golf revenues in fiscal year 2010 mainly due to a slight reduction
in number of rounds being played. Although it has reduced operating expenses as much as possible, revenues
have been inadequate to provide sufficient funds to also cover the payments on long term debt. A temporary
interfund loan from General Fund was made at the end of the year to provide sufficient cash for the final payment.
With no longer having to cover the debt service payment, it is expected that a reasonably good level of revenues
will enable repayment of the loan.
REQUEST FOR INFORMATION
This financial report is designed to provide our citizens, taxpayers, customers, investors and creditors with a
general overview of the City's finances and to show the City's accountability for the money it receives. If you
have questions about this report or need additional information, contact the Administrative Services Department
at City of Sebastian, 1225 Main Street, Sebastian, Florida 32958.
14
City of Sebastian, Florida
Statement of Net Assets
September 30, 2010
Governmental
Activities
ASSETS
Cash and cash equivalents $ 3,677,857 $
Investments 6,369,253
Receivables 755,966
Internal balances 685.000
Prepaid items 86,520
Inventory 65,728
Restricted assets:
Temporarily restricted:
Cash and cash equivalents
Investments
Permanently restricted:
Investments
Overfunded pension costs
Deferred charges
Capital assets not being depreciated:
Land
Construction in progress
Capital assets (net of accumulated depreciation):
Buildings
Improvements other than buildings
Machinery and equipment
Infrastructure
Total assets
LIABILITIES
Accounts payable and other current
liabilities
Accrued interest payable
Unearned revenues
Non -current liabilities:
Due within one year
Due in more than one year
Total liabilities
NET ASSETS
Invested in capital assets, net of related debt
Restricted for:
Debt service
Capital
Perpetual care:
Expendable
Nonexpendable
Other expenditures
Unrestricted
Total net assets
2,738,756
20.772
674,193
165,630
424,714
8,007,437
951.144
9,013,439
3,564,503
1,426,286
19,415,195
58,042,393
703,471
236,077
1,132
1,415,713
14,101,359
16,457,752
28,938,587
1,737,605
3,422,728
185,270
674,193
2,737,247
3,889,011
41, 584,641
Business -type
Activities
289,785
428,393
92,088
(685,000)
17,366
24,152
9,060
3,690
4,332,040
1,357,388
302,808
5,384,718
11,556,488
136,520
140,891
11,111
220,602
509,124
11,389,704
(342,340)
$ 1I,047,364 $
The accompanying notes to financial statements are an integral part of this financial statement.
Total
3,967,642
6,797,646
848,054
103,886
89,880
2,738,756
20,772
674,193
165,630
424,714
8,016,497
954.834
13,345,479
4,921,891
1,729,094
24,799,913
69,598,881
839,991
236,077
142,023
1,426,824
14,321,961
16,966,876
40,328,291
1,737,605
3,422,728
185,270
674,193
2,737,247
3,546,671
52,632,005
15
City of Sebastian, Florida
Statement of Activities
For the year ended September 30, 2010
Program Revenues
Operating
Capital
Charges for
Grants and
Grants and
Function/ProQram
Expenses
Services
Contributions
Contributions
Governmental activities:
General government
$ 3,309,381
$ 203,915
$ 5,229
$ -
Public safety
5,720,933
118,368
186,262
-
Physical environment
1,947,605
881,338
-
-
Transportation
1,863,551
-
18,559
595,746
Economic environment
135,885
-
-
2,556,872
Cultural/recreation
1,240,383
62,046
-
26,000
Interest and fiscal charges
566,410
-
-
-
Total governmental activities
14,784,148
1,265,667
210,050
3,178,618
Business -type activities:
Golf Course
1,388,158
1,335,647
-
-
Airport
1.067,525
468,698
-
904,853
Building
496,800
356,264
-
-
Total business -type activities
2,952,483
2,160,609
-
904,853
Total government
$ 17,736,631
$ 3,426,276
$ 210,050
$ 4,083,471
General Revenues:
Property taxes, levied for general purposes
Sales and use taxes
Franchise fees
State shared revenues not restricted to specific programs
Interest earnings
Miscellaneous
Total general revenues
Transfers
Total general revenues and transfers
Change in net assets
Net assets - beginning
Net assets - ending
The accompanying notes to financial statements are an integral part of this financial statement.
16
Net (Expense) Revenue and
Changes in Net Assets
Governmental Business -type
Activities Activities Total
$ (3,100,237) $
- $
(3,100,237)
(5,416,303)
-
(5,416,303)
(1,066,267)
-
(1,066,267)
(1,249,246)
-
(1,249,246)
2,420,987
-
2,420,987
(1,152,337)
-
(1,152,337)
(566,410)
-
(566,410)
(10,129,813)
-
(10,129,813)
-
(52,511)
(52,511)
-
306,026
306,026
-
(140,536)
(140,536)
-
112,979
112,979
(10,129,813)
112,979
(10,016,834)
4,164,128
-
4,164,128
4,765,200
-
4,765,200
1,228,692
-
1,228,692
1,825,215
-
1,825,215
144,432
15,658
160,090
149,453
1,194
150,647
12,277,120
16,852
12,293.972
(7,020)
7,020
-
12,270,100
23,872
12,293,972
2,140,287
136,851
2,277,138
39,444,354
10,910,513
50,354,867
$ 41,584,641 $
11,047,364 $
52,632,005
17
City of Sebastian, Florida
Balance Sheet
Governmental Funds
September 30, 2010
Stormwater
Discretionary Riverfront
Transportation
Utility
General
Sales Tax Redevelopment
Improvements
Improvements
ASSETS
Cash and cash equivalents $
1,357,145
$ 598,080 $ 408,957 $
494,178
$ 32,093
Investments
3,757,222
296,983 276,382
-
209,056
Accounts receivables
254,429
- 3,326
-
Due from other funds
200,000
- -
-
-
Due from other governments
239,359
198,890 -
-
-
Interest receivable
199
142 55
-
-
Inventory
65,728
- -
-
-
Prepaid items
86,520
- -
-
Advance to other funds
200,000
285,000 -
-
-
Total assets
6,160,602
1,379,095 688,720
494,178
241,149
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable
532,006
- 6,129
5,190
83,678
Due to other governments
15,065
- -
-
-
Other deposits held in escrow
1,132
- -
-
-
Total liabilities
548,203
- 6,129
5,190
83,678
Fund balances:
Nonspendable
352,248
- -
-
-
Restricted
-
1,379,095 682,591
488,988
157,471
Committed
3,063,585
- -
-
-
Assigned
31,656
- -
-
-
Unassigned
2,164,910
- -
-
-
Total fund balances
5,612,399
1,379,095 682,591
488,988
157,471
Total liabilities and fund balances $
6,160,602
$ 1,379,095 $ 688,720 $
494,178
$ 241,149
Amounts reported for governmental activities in the statement of net assets are different because:
Capital assets used in governmental activities are not financial resources, therefore, are not reported in the funds.
Negative net pension obligation resulting from overfunding of the police officers' pension plan.
Accrued other post employment and termination benefits are not financial uses, therefore, are not reported in the funds.
Long-term liabilities are not due and payable in the current period and, therefore, are not reported in the funds.
Accrued long term debt interest expenses are not financial uses, therefore, are not reported in the funds.
Net assets of governmental activities
The accompanying notes to financial statements are an integral part of this financial statement.
18
Other Total
Governmental Governmental
Funds Funds
3,526,160 $ 6,416,613
2,524,575
7,064,218
-
257,755
-
200,000
59,084
497333
482
878
-
65,728
-
86,520
-
485,000
6,110,301
15,074,045
61,403 688,406
- 15,065
- 1,132
61,403 704,603
859,463
1,211,711
5,189,435
7,897,580
-
3,063,585
-
31,656
-
2,164,910
6,048,898
14,369,442
6,110,301
42,378,004
165,630
(334,664)
(14,75704)
(236,077)
$ 41,584,641
19
City of Sebastian, Florida
Statement of Revenues, Expenditures, and Changes in Fund Balances
Governmental Funds
For the Year Ended September 30, 2010
Stormwater
Discretionary
Riverfront
Transportation
Utility
General
Sales Tax
Redevelopment
Improvements
Improvements
REVENUES:
Taxes:
Property
$ 3,734,398
$ -
$ 429,730
$ -
$ -
Public utility
2,437,050
-
-
-
Sales
-
2,328,150
-
-
-
Motor fuel
-
-
-
-
-
Franchise fees
1,228,692
-
-
-
-
Licenses and permits
33,182
-
-
-
-
Intergovernmental
1,997,119
-
2,556,872
-
-
Impact fees
-
-
-
-
-
Charges for services
282,530
-
-
-
-
Fines
71,415
-
-
-
-
Investment earnings
127,524
25,465
3,056
2,202
Contributions and donations
13,442
-
-
-
-
Other revenue
145,929
-
3,781
-
Total revenues
10,071,281
2,353,615
2,993,439
-
2,202
EXPENDITURES:
Current:
General government
2,699,289
-
-
-
-
Public safety
4,932,132
-
-
-
-
Physical environment
1,196,595
-
-
-
14,131
Transportation
1,080,786
-
-
-
Economic environment
-
-
129,352
-
Culture and recreation
977,780
-
-
-
-
Debt Service:
Principal
-
-
-
-
-
Interest and fiscal charges
-
-
-
-
Capital outlay
105,302
-
3,096,416
130,868
2,618,030
Total expenditures
10,991,884
-
3,225,768
130,868
2,632,161
Excess (deficiency) of revenues
over (under) expenditures
(920,603)
2,353,615
(232,329)
(130,868)
(2,629,959)
OTHER FINANCING
SOURCES (USES)
Transfers in
764,888
559,446
111
90,145
1,229,205
Transfers out
-
(2,492,642)
(69,829)
(37,596)
(522,000)
Debt proceeds
-
-
-
-
-
Total other financing sources (uses)
764,888
(1,933,196)
(69,718)
52,549
707,205
Net changes in fund balances
(155,715)
420,419
(302,047)
(78,319)
(1,922,754)
Fund balances - beginning
5,768,114
958,676
984,638
567,307
2,080,225
Fund balances - ending
$ 5,612,399
$ 1,379,095
$ 682,591
$ 488,988
$ 157,471
The accompanying notes to financial statements are an integral part of this financial statement.
20
Other Total
Governmental Governmental
Funds Funds
$ 4,164,128
2,437,050
2,328,150
595,746
595,746
-
1,228,692
-
33,182
18,559
4,572,550
26,000
26,000
872,209
1,154,739
19,533
90,948
69,969
228,216
5,887
19,329
-
149,710
1,607,903
17,028,440
2,699,289
6,015 4,938,147
97 1,210,823
324,524 1,405,310
- 129,352
977,780
2,142,190
2,142,190
577,593
577,593
238,410
6,189,026
3,288,829
20,269,510
(1,680,926) (3,241,070)
1,842,831
4,486,626
(1,371,579)
(4,493,646)
2,462,000
2,462,000
2,933,252
2,454,980
1,252,326
(786,090)
4,796,572
15,155,532
6,048,898 $ 14,369,442
21
City of Sebastian, Florida
Reconciliation of the Statement of Revenues, Expenditures,
and Changes in Fund Balances of Governmental Funds
To the Statement of Activities
For the Year Ended September 30, 2010
Net change in fund balances - total governmental funds $ (786,090)
Amount reported for governmental activities in the statement of activities are different
because:
Some interest revenues reported in the statement of activities do not constitute
current financial resources, therefore, are not reported as revenues in governmental
funds. (83,784)
Governmental funds report capital outlay as expenditures. However, in the statement
of activities, the cost of those assets is allocated over their estimated useful lives as
depreciation expense. 3,706,111
Governmental funds only report the disposal of assets to the extent proceeds are
received from the sale. In the statement of activities, a gain or loss is reported for
each disposal. (1,391)
Issuance of long-term debt is recorded as revenue and expense in the governmental
funds, but the proceeds increase long-term debt liabilities and deferred charges in the
statement of net assets. (2,362,282)
Repayment of bond principal, note principal, and capital lease principal are
expenditures in the governmental funds, but the payment reduces long-term
liabilities in the statement of net assets. 2,142,203
Some expenses reported in the statement of activities do not require the use of
current financial resources, therefore, are not reported as expenditures in the
governmental funds. (474,480)
Change in net assets of governmental activities $ 2,140,287
The accompanying notes to financial statements are an integral part of this financial statement.
22
City of Sebastian, Florida
Statement of Net Assets
Proprietary Funds
September 30, 2010
Enterprise Funds
Golf Course
Airport
Building
Totals
ASSETS
Current assets:
Cash and cash equivalents
$ 9,410 $
5,273 $
275,102 $
289,785
Investments
-
-
428,393
428,393
Accounts receivable
34,456
-
34,456
Due from other governments
57,593
-
57,593
Interest receivable
-
2
37
39
Inventory
12,117
12,035
-
24,152
Prepaid items
9,492
5,682
2,192
17,366
Total current assets
31,019
115,041
705,724
851,784
Noncurrent assets:
Capital assets:
Land
-
9,060
-
9,060
Buildings
331,228
4,752,002
5,083,230
Improvements other than buildings
271,475
1,670,754
-
1,942,229
Machinery and equipment
321,924
650,989
60,526
1,033,439
Infrastructure
1,100,951
6,377,025
-
7,477,976
Construction in process
-
3,690
-
3,690
Less accumulated depreciation
(1,358,631)
(2,748,174)
(53,115)
(4,159,920)
Total noncurrent assets
666,947
10,715,346
7,411
11,389,704
Total assets
697,966
10,830,387
713,135
12,241,488
LIABILITIES
Current liabilities
Accounts payable
27,790
84,673
17,864
130,327
Due to other funds
200,000
-
-
200,000
Advance from other fund
-
485,000
485,000
Due to other governments
5,835
358
-
6,193
Unearned revenues
62,295
3,792
74,804
140,891
Accrued compensated absences
220
2,056
8,835
11,111
Total current liabilities
296,140
575,879
101,503
973,522
Non -current liabilities:
Compensated absences
62,563
50,833
77,982
191,378
Unfunded OPEB obligation
8,263
13,513
7,448
29,224
Total non -current liabilities
70,826
64,346
85,430
220,602
Total liabilities
366,966
640,225
186,933
1,194,124
NET ASSETS
Invested in capital assets, net of related debt
666,947
10,715,346
7,411
11,389,704
Unrestricted (deficit)
(335,947)
(525,184)
518,791
(342,340)
Total net assets
$ 331,000 $
10,190,162 $
526,202 $
11,047,364
The accompanying notes to financial statements are an integral part of this financial statement.
23
City of Sebastian, Florida
Statement of Revenues, Expenses and Changes in Fund Net Assets
Proprietary Funds
For the Year Ended September 30, 2010
Operating revenues:
Charges for fees and rents:
Building permit fees
Golf course fees pledged as
security for revenue bonds
Rents
Other revenue
Total operating revenues
Operating expenses:
Salaries, wages and employee benefits
Contractual services, materials and supplies
Depreciation
Total operating expenses
Operating income (loss)
Nonoperating revenues (expenses):
Interest income
Intergovernmental
Gain on disposal of fixed assets
Interest expense
Bond amortization expense
Total nonoperating revenues (expenses)
Income/(loss) before capital contributions
and transfers
Transfer in
Capital contributions
Change in net assets
Total net assets - beginning
Total net assets - ending
Enterprise Funds
Golf Course
Airport
Building
Totals
$ -
$
$ 356,264 $
356,264
1,297,783
-
1,297,783
29,744
304,100
-
333,844
8,120
164,805
-
172,925
1,335,647
468,905
356,264
2,160,816
333,105
233,677
375,458
942,240
933,121
223,049
109,237
1,265,407
87,910
602,249
12,105
702,264
1,354,136
1,058,975
496,800
2,909,911
(18,489)
(590,070)
(140,536)
(749,095)
4,921
-
10,737
15,658
987
-
-
987
(20,125)
(8,550)
-
(28,675)
(13,897)
-
-
(13,897)
(28,114)
(8,550)
10,737
(25,927)
(46,603)
(598,620)
(129,799)
(775,022)
-
7,020
-
7,020
904,853
-
904,853
(46,603)
313,253
(129,799)
136,851
377,603
9,876,909
656,001
10,910,513
$ 331,000
$ 10,190,162
$ 526,202 $
11,047,364
The accompanying notes to financial statements are an integral part of this financial statement.
24
City of Sebastian, Florida
Statement of Cash Flows
Proprietary Funds
For the Year Ended September 30, 2010
CASH FLOWS FROM OPERATING
ACTIVITIES:
Cash received from customers and users
Cash payments to suppliers
Cash payments for employee services
Net cash provided (used) by operating
activities
CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES:
Loan from other fund
Interest paid on advance from other funds
Net cash provided (used) by noncapital
financing activities
CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES:
Acquisition and construction of capital assets
Receipt from capital grants
Receipt from sale of assets
Receipt from transfer from other fund
Principal paid on revenue bond maturities
Interest paid on revenue bonds
Net cash provided (used) by capital and
related financing activities
CASH FLOWS FROM INVESTING
ACTIVITIES:
Proceeds from sales and maturities of investments
Interest on investments
Net cash provided by investing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents, October I
Cash and cash equivalents. September 30
Enterprise Funds
Golf Course
Airport
Building
Totals
$ 1,337,499
$ 438,240
$ 344,347 $
2,120,086
(966,894)
(160,326)
(108,661)
(1,235,881)
(335,103)
(233,837)
(383,260)
(952,200)
35,502
44,077
(147,574)
(67,995)
200,000 - - 200,000
- (8,550) - (8,550)
200,000 (8,550) - 191,450
(22,499)
(1,051,318)
- (1,073,817)
-
923,444
- 923,444
987
-
- 987
-
7,020
- 7,020
(300.000)
-
- (300,000)
(12,600)
-
- (12,600)
(334,112)
(120,854)
- (454,966)
-
- 382,976
382,976
4,921
- 14,199
19,120
4,921
- 397,175
402,096
(93,689)
(85,327) 249.601
70,585
103,099
90,600 25,501
219,200
$ 9,410 $
5,273 $ 275,102 $
289,785
The accompanying notes to financial statements are an integral part of this financial statement.
25
City of Sebastian, Florida
Statement of Cash Flows
Proprietary Funds
For the Year Ended September 30, 2010
(Continued)
Reconciliation of operating income (loss) to
net cash provided (used) by operating activities:
Operating income (loss)
Adjustments to reconcile operating income to net
cash provided (used) by operating activities:
Depreciation expense
(Increase) Decrease in assets:
Accounts receivable
Inventories
Prepaid expenses
Increase (Decrease) in liabilities:
Accounts payable
Due to other governments
Unearned revenues
Accrued termination benefits
Accrued compensated absences
Accrued OPEB liability
Total adjustments
Net cash provided (used) by operating activities
Cash and cash equivalents reconciliation:
Current assets:
Cash and cash equivalents
Cash and cash equivalents at September 30
Enterprise Funds
Golf Course Airport Building Totals
$ (18,489) $ (590,070) $ (140,536) $ (749,095)
87,910
602,249
12,105
702,264
-
(34,456)
-
(34,456)
931
833
-
I,764
3,698
5,362
(145)
8,915
(37,758)
57,001
721
19,964
(644)
(474)
-
(1,118)
1,852
3,792
(11,917)
(6,273)
-
-
(6,171)
(6,171)
(2,611)
5,828
4,464
7,681
613
(5,988)
(6,095)
(11,470)
53,991
634,147
(7,038)
681,100
35,502
44,077
(147,574)
(67,995)
9,410 5,273 275,102 289,785
$ 9,410 $ 5,273 $ 275,102 $ 289,785
The accompanying notes to financial statements are an integral part of this financial statement.
26
City of Sebastian, Florida
Statement of Fiduciary Net Assets
Fiduciary Funds
September 30, 2010
ASSETS
Cash and cash equivalents
Interest and dividends receivable
Investments, at fair value:
Local government surplus trust funds investment pool
United States treasuries
United States agency notes
Domestic corporate bonds
Municipal Obligations
Domestic corporate equities
Total investments
Total assets
LIABILITIES
Refunds payable
Total liabilities
NET ASSETS
Held in trust for pension benefits
Pension
Trust
Police
Officers'
Pension
$ 692,069 $
30,185
399,758
1,068,413
1,493,858
102,963
3,299,056
6,364,048
7,086,302
$ 7,086,302 $
Agency
Performance
Deposits
The accompanying notes to financial statements are an integral part of this financial statement.
27
11,930
220,000
220,000
231,930
231,930
231,930
City of Sebastian, Florida
Statement of Changes in Fiduciary Net Assets
Fiduciary Fund - Pension Trust
For the Year Ended September 30, 2010
Police
Officers'
Pension
ADDITIONS
Contributions:
Employer
Plan members
State
Total contributions
Investment earnings:
Net increase in fair value of investments
Interest and dividends
Total investment earnings
Less investment expenses
Net investment earnings
Total additions
DEDUCTIONS
Benefits
Refunded contributions
Administrative expenses
Total deductions
Change in net assets
Net assets - beginning of year
Net assets - end of year
566,910
115,421
134,852
817,183
260,719
185,647
446,366
(37,448)
408,918
1,226,101
119,131
10,653
10,969
140,753
1,085,348
6,000,955
7,086,303
The accompanying notes to financial statements are an integral part of this financial statement.
28
City of Sebastian, Florida
Notes to the Financial Statements
September 30, 2010
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The City of Sebastian (the "City"), a Florida Municipal Corporation, was incorporated in 1924 under Sections 1826-1832 of the Revised
Florida Statutes. The City has a population of 22,922 living in an area of approximately 14.6 square miles. The governing body is a five
member elected City Council with a mayor elected from the five members. The City Council appoints the City Manager who is
responsible for the administration of all City services.
The financial statements of the City have been prepared in conformity with U.S. generally accepted accounting principles as applied to
governmental units. The more significant of the City's accounting policies are described below:
A. ReDOrting Entity
In evaluating the City as a reporting entity, management has included all component units in accordance with Governmental
Accounting Standards Board (GASB) Statement No. 14, "Defining the Financial Reporting Entity" and Statement No. 39 — an
amendment of GASB No. 14. The Financial Reporting Entity consists of the City of Sebastian (the primary government) and its
blended component units. Blended component units are legally separate organizations for which the City Council is financially
accountable. The component units discussed below are included in the City's reporting entity.
Blended Component Units
The following component units are blended with the primary government for financial statement purposes because the component
unit's governing body is substantially the same as the City Council or because the component unit exclusively serves the City.
Community Redevelopment Agency (CRA) — The governing body of the CRA is the Sebastian City Council. The CRA is accounted
for in a special revenue fund entitled "Riverfront Redevelopment". F.S. Section 163.387(8) requires an independent audit of the fund
each fiscal year and a report of such audit. The City has presented the CRA as a major fund of the City to satisfy this requirement
simply due to the scope of the audit for a major fund is broader than a non -major fund.
City of Sebastian Police Officers' Pension Plan — The City Council only appoints two of the five members of the governing board,
but it is financially responsible for funding the police officers' pension benefits. The City of Sebastian Police Officers' Pension Trust
Fund only exists to provide pension benefits to City of Sebastian police officers. It is accounted for as a Pension Trust fund entitled
"Police Officers' Pension".
B. Government -wide and fund financial statements
The government -wide financial statements (i.e., the statement of net assets and the statement of changes in net assets) report
information on all of the nonfiduciary activities of the primary government and its blended component units. For the most part, the
effect of interfund activity has been removed from these statements. Governmental activities, which normally are supported by taxes
and intergovernmental revenues, are reported separately from business -type activities, which rely to a significant extent on fees and
charges for support.
Separate fund financial statements are provided for governmental funds, proprietary funds, and fiduciary funds, even though the latter
are excluded from the government -wide financial statements. Major individual governmental funds and major individual enterprise
funds are reported as separate columns in the fund financial statements.
GASB Statement No. 34 Basic Financial Statements and Manaeement Discussion and Analvsis for State and Local Governments sets
forth minimum criteria (percentage of the assets, liabilities, revenues or expenditures/expenses of either fund category or the
governmental and enterprise funds combined) for the determination of major funds. The nonmajor funds are combined in a column
in the fund financial statements and detailed in the combining section.
29
C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation
1. Economic Resources Measurement Focus and Accrual Basis of Accounting
The government -wide financial statements are reported using the economic resources measurement focus and the accrual basis
of accounting, as are the proprietary fund and fiduciary fund financial statements. This means that revenues are recorded when
earned and expenses are recorded when a liability is incurred, regardless of the timing of the related cash flows. Property taxes
are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as
all eligibility requirements imposed by the provider have been met.
In applying the "susceptible to accrual" concept to intergovernmental revenues pursuant to GASB Statement No. 33, Accounting
and Financial ReDortin2 for Nonexchanee Transactions as amended by GASB Statement No. 36, Recipient ReD0rtin8 of Certain
Shared Nonexchanee Revenues (the City may act as either provider or recipient), the provider should recognize liabilities and
expenses and the recipient should recognize receivables and revenue when the applicable eligibility requirements including time
requirements, are met. Resources transmitted before the eligibility requirements are met should, under most circumstances, be
reported as advances by the provider and deferred revenue by the recipient.
Private -sector standards of accounting and financial reporting issued prior to December 1, 1989, generally are followed in both
the government -wide and proprietary fund financial statements to the extent that those standards do not conflict with or
contradict guidance of the Governmental Accounting Standards Board. Governments also have the option of following
subsequent private -sector guidance for their business -type activities and enterprise funds, subject to this same limitation. The
government has elected not to follow subsequent private -sector guidance.
As a general rule the effect of interfund activity has been eliminated from the government -wide financial statements.
The statement of activities demonstrates the degree to which the direct expenses of a given function or segment are offset by
program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program
revenues include I) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges
provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operational or capital
requirements of a particular function or segment. Taxes and other items not properly included among program revenues are
reported instead as general revenues.
Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses
generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal
ongoing operations. The principal operating revenues of the golf course fund and the building fund are charges to customers for
services and for the airport fund lease revenue. Operating expenses for enterprise funds include cost of sales and services,
administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported
as nonoperating revenues and expenses.
The agency fund reports only assets and liabilities; therefore, it does not have a measurement focus. However, it uses the accrual
basis of accounting to recognize receivables and payables.
2. Modified Accrual
Governmental fund financial statements are reported using the current financial resources measurement focus and the modified
accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. "Available" means
collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. For this
purpose, the City considers revenues to be available if they are collected within sixty (60) days of the end of the current fiscal
period except grant revenues. The City considers grant revenues to be available if they are collected within one year of the end
of the current fiscal period. All material revenues, except for property taxes, are considered measurable and available and are
thus susceptible to accrual. Expenditures are generally recognized under the modified accrual basis of accounting when the
related fund liability is incurred, if measurable. An exception to this general rule is principal and interest on general long-term
obligations, which are recognized when due.
Property taxes, public utility taxes, franchise fees, sales and fuel taxes, licenses, and interest associated with the current fiscal
period are all considered to be susceptible to accrual and so have been recognized as revenues in the current fiscal period. Only
the portion of special assessments receivable due within the current fiscal period is considered to be susceptible to accrual as
revenue of the current period. All other revenue items are considered to be measurable and available only when cash is received
by the City.
30
The government reports the following major governmental funds:
The general fund is the government's primary operating fund. It accounts for all financial resources of the
general government, except those required to be accounted for in another fund.
The discretionary sales tax fund accounts for the financial resources used for infrastructure improvements
and equipment purchases.
The riverfront redevelopment fund accounts for tax increment revenues that are legally restricted for the
redevelopment of the City's riverfront area.
The transportation improvements fund accounts for transportation related construction such as, roads,
intersections, and sidewalks and is funded with governmental resources, impact fees, local option gas tax, and
state grants.
The stormwater utility improvements fund accounts for the resources associated with debt and stormwater
assessment fees for the purpose of constructing stormwater related improvements.
The government reports the following major proprietary funds:
The golf course fund accounts for the activities of the municipal golf course.
The airport fund accounts for the activities of the municipality's general aviation airport.
The building fund accounts for the activities associated with the building permit and inspection program.
Additionally, the government reports the following fund types:
The pension trust fund accounts for the activities of the Police Officer's Retirement System, which
accumulates resources for pension benefit payments to qualified police officers.
The performance deposits fund accounts for deposits placed by bidders and developers to guarantee
performance pursuant to bid or contract. These funds are held by the City as agent for individuals and
businesses.
D. Assets, Liabilities and Fund Eauitv
1. Cash and cash eauivalents
Cash and cash equivalents represents all investments that are short term, highly liquid, and readily convertible to a specified
cash value. These investments generally have original maturities of three months or less. Cash equivalents consist of cash in
banks and on hand.
2. Investments
Investments consist of U.S. Treasury Securities, U.S. Government Agency Securities, common stock, guaranteed investment
contracts and the Local Government Surplus Funds Trust Fund Investment pool (Pool A and Pool B). The Local Government
Surplus Funds Trust Fund is administered by the Florida State Board of Administration, which is not a registrant with the
Securities and Exchange Commission. However, the Board has adopted operating procedures consistent with the requirements
for a 2a-7 fund or accounts in Pool A. In accordance with the regulations of 2a-7 like pools, the City's share of investments held
at the State Board of Administration in Pool A are reported at amortized cost, which approximates fair value. This pool is
regulated by the State and the fair value of the position in the pool is the same as the value of the pool share. Investment
earnings of Pool A are allocated to the participating funds at the end of each month based upon the ratio of each participant's
investment to the total pooled investments. Investments in the State Board of Administration account in Pool B are reported at
fair value and as income and returns of principal become available, they are transferred to Pool A. Other investments, including
the Police Officers' Pension Fund, are reported at their fair value based on the quoted market price or the best available
information.
3. lnterfund Receivables and Pavables
During the course of operations, transactions occur between individual funds that may result in amounts owed between funds.
Short-term interfund loans are reported as "due to and from other funds". Due to and from other funds are eliminated in the
Statement of Net Assets. As of September 30, 2010, the golf course fund was loaned $200,000 from the general fund to cover
the final bond payment. There were no other interfund loans between the Governmental funds and Proprietary funds.
Advances between funds, as reported in the fund financial statements, are offset by a fund balance reserve account in applicable
governmental funds to indicate that they are not available for appropriation and are not expendable available financial resources.
As of September 30, 2010, the airport fund has been advanced $200,000 from the general fund and $285,000 from the
discretionary sales tax fund.
31
4. Receivables
Receivables consist of trade receivables, due from other governments and interest receivable (see Note IV.C. on page 39 for
detail) and are recorded at the net realizable value. The City, as of September 30, 2010, has no allowance for doubtful accounts,
since all receivables are considered collectible.
5. Inventory and Prepaid Items
Inventory is valued at cost using the average cost method. Inventory in the General fund consists of materials and supplies held
for consumption. The cost is recorded as an expenditure/expense at the time the individual inventory items are consumed.
Inventory in the Golf Course fund consists of supplies held for resale.
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both
government -wide and fund financial statements.
6. Restricted Assets
Certain net assets of the City are classified as restricted assets on the statement of net assets because their use is limited either by
law through constitutional provision or enabling legislation; or by restrictions imposed externally by creditors, grantors,
contributors, or laws or regulations of other governments. In a fund with both restricted and unrestricted assets, qualified
expenses are considered to be paid first from restricted net assets and then from unrestricted net assets.
7. Capital Assets
Capital assets, which include land, buildings, improvements, equipment, and infrastructure assets (e.g., roads, bridges,
sidewalks, and similar items), are reported in the applicable governmental or business -type activities columns in the
government -wide financial statements. The City defines capital assets as assets with an initial, individual cost of more than
$750 and an estimated useful life in excess of one year. Such assets are recorded at historical cost, if purchased, and at fair
market value at date of gift, if donated. Major additions are capitalized while maintenance and repairs that do not improve or
extend the life of the respective assets are expensed.
All infrastructure assets acquired prior to the implementation of GASB Statement 34 were capitalized as projects and were
completed or assets were acquired. Therefore, the initial capitalization of general infrastructure assets was not necessary.
Capital asset depreciation is recognized using the straight-line method over the estimated useful lives as follows:
Classification
Ranee of Lives
Buildings and improvements
10-40 years
Public domain infrastructure
40-50 years
System infrastructure
15-30 years
Improvements other than buildings
10-40 years
Machinery, equipment and other
5-15 years
Airport runways
20 years
8. Comaensated Absences
It is the City's policy to permit employees to accumulate earned but unused vacation and sick leave benefits and these are
accounted for using the termination payment method. All vacation and sick leave amounts are accrued in the government -wide
and proprietary financial statements. A liability for these amounts is reported in governmental funds only if they have matured,
for example, as a result of employee resignations and retirements.
9. Long -Term Liabilities
In the government -wide financial statements, and proprietary fund types in the fund financial statements, long-term debt and
other long-term obligations are reported as liabilities in the applicable governmental activities, business -type activities, or
proprietary fund type statement of net assets. Bond premiums and discounts, as well as issuance costs, are deferred and
amortized over the life of the bonds using the straight-line method. Bonds payable are recorded net of the applicable bond
premium or discount. Bond issuance costs are reported as deferred charges and amortized over the life of the related debt. In
the fund financial statements, governmental fund types recognize bond premium and discounts, as well as debt issuance costs,
during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt
issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses.
Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures.
32
10. Fund Balances
GASB Statement No. 54, Fund Balance Renortime and Governmental TVDe Definitions is effective for periods beginning after
June 15, 2010, with early implementation encouraged. The City chose to implement it for the year ended September 30, 2010.
It establishes criteria for classifying fund balances into specifically defined classifications. These classifications are explained
as follows:
Nonspendable — amounts that cannot be spent because they are either not in spendable form or legally or
contractually required to be maintained intact.
Restricted — amounts where constraints have been placed by creditors, grantors, contributors, or laws or
regulations of other governments or imposed by law through constitutional provisions or enabling
legislation.
Committed — amounts that can only be used for specific purposes pursuant to constraints imposed by
formal action of the government's highest level of decision making authority, which is the City Council.
These commitments are established annually by adoption of a financial policies resolution.
Assigned — amounts that are constrained by the government's intent to be used for specific purposes, but
are neither restricted nor committed. These consist of deposits from various sources that the City
Manager has directed to be earmarked for certain purposes.
Unassigned — amounts representing fund balance that has not been restricted, committed or assigned to
specific purposes within the general fund and balances in other governmental funds, if any, exceeding the
amounts restricted, committed or assigned to those purposes.
II. RECONCILIATION OF GOVERNMENT -WIDE AND FUND FINANCIAL STATEMENTS
A. Explanation of Differences Between the Governmental Fund Balance Sheet and the Government -wide Statement
of Net Assets
The governmental fund balance sheet includes reconciliation between fund balance -total governmental funds and net assets -
governmental activities as reported in the government -wide statement of net assets.
"Total fund balances" of the City's governmental funds ($14,369,442) differs from "net assets" of governmental activities
($41,584,641) reported in the statement of net assets. This difference primarily results from the long-term economic focus of the
statement of net assets versus the current financial resources focus of the governmental fund balance sheet. The effect of the
differences is illustrated below.
Capital related items
When capital assets (property, plant, equipment) that are to be used in the governmental activities are purchased or constructed, the
cost of those assets are reported as expenditures in governmental funds. However, the statement of net assets included those capital
assets among the assets of the City as a whole.
Cost of capital assets
Accumulated depreciation
Total
$ 65,392,481
(23,014.477)
$ 42,378,004
Net pension obligation
When net pension obligation is a negative amount, the amount is presented as an asset on the statement of net assets.
Negative net pension obligation
165.630
Other post emplovment and termination benefits
Accrued other post employment and termination benefits are not financial uses, therefore, are not reported in the fund.
Other post employment benefits
Termination benefits
Total
$ (310,541)
(24.123).
$ (334.664)
33
Lone -term debt transactions
Long-term liabilities applicable to the City's governmental activities are not due and payable in the current period and accordingly
are not reported as fund liabilities (both current and long-term) are reported in the statement of net assets. Balances at September 30,
2010 were:
Bonds payable:
Infrastructure sales surtax revenue bonds,
Series 2003
$(5,655,000)
Less: Deferred charge for issuance costs
146.198
$(5,508,802)
Infrastructure sales surtax revenue bonds,
Series 2003A
(1,325,000)
Less: Deferred charge for issuance costs
57.191
(1,267,809)
Stormwater utility revenue bonds,
Series 2003
(4,055,000)
Less: Deferred charge for issuance costs
126,975
Less: Deferred charge for bond discounts
9.583
(3,918,442)
Notes payable
(2,414,000)
Less: Deferred charge for issuance costs
29,426
Deferred charge for refunding costs
64.924
(2,319,650)
Contamination liability
(91,200)
Compensated absences
(1.651.791)
Total
$(14.757.694)
Accrued interest
Accrued liabilities in the statement of net assets differs from the amount reported in governmental funds due to accrued interest on
bonds payable and notes payable.
Bonds $ (203,272)
Notes (32.805)
Total $ (236.077)
34
B. Exnlanation of Differences Between the Governmental Fund Statement of Revenues. Exuenditures, and Changes
in Fund Balances and the Government -wide Statement of Activities
The "net change in fund balances" for governmental funds (a decrease of $786,089) differs from the "change in net assets" for
governmental activities (an increase of $2,339,537) reported in the statement of activities. The differences arise primarily from the
long-term economic focus of the statement of activities versus the current financial resources focus of the governmental funds. The
effect of the differences is illustrated below.
Interest receivables
Some interest earnings reported in the statement of activities the prior year were reported as revenues in governmental funds.
Interest earnings
(83.784)
Capital related items
When capital assets that are to be used in governmental activities are purchased or constructed, the resources expended for those
assets are reported as expenditures in governmental funds. However, in the statement of activities, the costs of those assets is
allocated over their estimated useful lives and reported as depreciation expense. As a result, fund balances decrease by the amount of
financial resources expended, whereas net assets decrease by the amount of depreciation expense charged for the year.
Capital outlay $ 6,I89,026
Depreciation expense (2.482.915)
Difference $ 3.706.11 1
In the statement of activities, the gain and loss on the sale and disposal of capital assets are reported. However, in the governmental
funds, only the proceeds from the sale increase financial resources.
Loss on disposal of fixed assets $ (1.391)
Lon¢ -term debt transactions
Issuance of long-term debt is recorded as revenue for the principal received and expense for the issuance costs in the governmental
funds and, thus, has the effect of increasing fund balance because of a net increase to current financial resources. However, the
proceeds increase long-term debt and the expense is amortized in the statement of net assets and do not result in a revenue in the
statement of activities.
Increase in long-term debt $ (2,462,000)
Issuance costs of new debt 99.718
$ (2.362,282)
Repayments of bond principal, notes payable principal, and capital lease principal are reported as expenditures in the governmental
funds and, thus, have the effect of reducing fund balance because current financial resources have been used. However, the principal
payments reduce the liabilities in the statement of net assets and do not result in an expense in the statement of activities.
Bond principal payment made $ 1,005,000
Notes payable principal payment made I,137,203
Total 2.142.203
Some expenses reported in the statement of activities do not require the use of current financial resources, therefore, are not reported
as expenditures in governmental funds.
Net change in compensated absences
$ (405,986)
Net accrued bond interest expense
15,627
Net accrued notes interest expense
(28,272)
Amortization of issuance costs/discounts
(47,353)
Other post employment benefits
(6,252)
Termination benefits
(2,244)
Net adjustment
$ (474,480)
35
III. STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY
Buftetary Information
Budgets are prepared annually on a modified accrual basis with encumbrance accounting for all governmental funds except the capital
project funds, which are approved on a "life of the project basis", and the permanent fund, which is not budgeted. All annual
appropriations lapse at year end.
On or before the third Friday in May of each year, all agencies of the government submit requests for appropriations to the government's
City Manager so that a budget may be prepared. Before July 31, the proposed budget is presented to the government's council for review.
The council holds budget workshops and public hearings and a final budget must be prepared and adopted no later than September 30.
Encumbrance accounting, under which purchase orders, contracts, and other commitments for the expenditure of monies are recorded in
order to reserve that portion of the applicable appropriation, is employed as an extension of formal budgetary integration in the General,
Special Revenue, Debt Service, and Capital Projects funds. Encumbrances outstanding at year end are carried forward and reappropriated
to the next year's budget.
Actual results of operations presented in accordance with U.S. generally accepted accounting principles (GAAP basis) and the City's
accounting policies do not recognize encumbrances as expenditures until the period in which the actual goods or services are received and
a liability is incurred. It is necessary to include budgetary encumbrances to reflect actual revenues and expenditures on a basis consistent
with the City's legally adopted budget. (See page 52 through page 54)
IV. DETAIL NOTES ON ALL FUNDS
A. Deposits
At September 30, 2010, the carrying amount of the City of Sebastian's deposits with banks was $6,715,899 and the bank balance was
$6,706,793. All the deposits were covered by the FDIC or collateralized in accordance with the "Florida Security for Public Deposits
Act". Under the Act, every qualified public depository shall deposit with the Treasurer eligible collateral having a market value equal
to 50% of the average daily balance for each month that all public deposits are in excess of any applicable deposit insurance. If the
public deposits exceed the total amount of the regulatory capital accounts of a bank or the regulatory net worth of a savings
association, the required collateral shall have a market value equal to 125% of the deposits.
B. Investments
On April 23, 2003, Sebastian City Council formally adopted an investment policy pursuant to Section 218.415, Florida Statutes that
established permitted investments, asset allocation limits and issuer limits, credit ratings requirements and maturity limits to protect
City's cash and investment assets. The City maintains a common cash and investment pool for the use of all funds. Pension Trust
Funds are held with third party trustees and are governed by rules established by Florida Statute Chapter 185.
Investment holdings during the year included United States Government Agencies which were reported at fair value in accordance
with GASB Statement No.31 "Accounting and Financial Reporting for Certain Investments and for External Investment Pools".
These investments were held in trust by the City's bank depository in the City's name.
Section 218.415, Florida Statutes, limits the types of investments that the City can invest in unless specially authorized in the City's
investment policy. The City has a formal investment policy that allows for the following investments: Florida Local Government
Surplus Funds Trust Fund, United States Government Securities, United States Government Agencies, Federal Instrumentalities,
Interest Bearing Time Deposit or Saving Accounts, Repurchase Agreements, Commercial Paper, High Grade Corporate Notes,
Bankers' Acceptances, State and/or Local Government Taxable and/or Tax -Exempt Debt, Registered Investment Companies (Money
Market Mutual Funds), and Intergovernmental Investment Pool.
Florida Statutes Chapter 185 regulates the types of investment that may be held by the Police Pension Trust Fund. The investment
guidelines have been augmented by City ordinance that have adopted specific investment policies. Compliance with the policies and
guidelines has been evaluated by the pension board.
36
As of September 30, 2010, the City had the following investments and effective duration presented in terms of years:
Investment Tvne
Government -wide
Local government surplus fund trust
fund investment pool
Certificate of deposit
Fiduciary Funds
Local government surplus funds trust
fund ("SBA")
United States Treasuries
United States Agencies
Municipal Obligations
Domestic corporate bonds
Domestic corporate equities
Total fair value
Investment Maturitv (Year)
Fair Value
Less Than 1
From 1-3
From 4-6
Over 7
$ 5,837,453
$ 5,837,453
$
$
$ -
1,736,484
1,736,484
-
-
7,573,937
7,573,937
-
-
220,000
220,000
-
-
399,758
-
204,110
-
195,648
1,068,413
174,576
79,319
814,518
102,963
-
-
102,963
1,493,858
-
210,645
754,384
528,829
3,299,056
3,299,056
-
-
-
6,584,048
3,519,056
589,331
833,703
1,641,958
$ 14,157,985
$ 11,092,993
$ 589,331
$ 833,703
$ 1,641,958
Interest receivable on the government -wide and fiduciary investment portfolios amounted to $917 and $30,185, respectively, as of
September 30, 2010.
Interest Rate Risk
The City's investment policy limits interest rate risk by attempting to match investment maturities with known cash needs and
anticipated cash flow requirements. Investment maturities shall not exceed thirty-six (36) months. Investments of construction funds
shall have a term appropriate to the need for funds and in accordance with debt covenants.
Credit Risk
The City investment policy permits for investments in the following investments, which are limited to credit quality ratings from
nationally recognized agencies as follows:
Mutual funds shall be rated "m" or "AAm-G" or better by Standard & Poor's, or the equivalent by another rating agency. State and/or
local government taxable and/or tax-exempt debt, general obligation and/or revenue bonds, rated at least "Aa" by Moody's and "AA"
by Standard & Poor's for long-term debt, or rated at least "MIG-2" by Moody's and `SP-2" by Standard & Poor's for short-term
debt. Bankers' acceptances issued by a domestic bank or a federally chartered domestic office of a foreign bank, which are eligible
for purchase by the Federal Reserve System, at the time of purchase, the short-term paper is rated, at a minimum, "P-1" by Moody's
Investors Services and "A-]" Standard & Poor's. Commercial paper of any United States company that is rated, at the time of
purchase, "Prime -I" by Moody's and "A-1" by Standard & Poor's (prime commercial paper). Corporate notes issued by corporations
organized and operating within the United States or by depository institutions licensed by the United States that have a long term debt
rating, at the time of purchase, at a minimum "Aa" by Moody's and a minimum long term debt rating of "AA" by Standard & Poor's.
As of September 30, 2010, the City's investment securities were all individually rated AAA by Standard & Poor's and Aaa by
Moody's Investor Services.
As of September 30, 20I0, the city had $6,057,453 invested in the State Board of Administration's Local Government Surplus Trust
Funds Investment Pool, which consist of accounts in Pool A and Pool B. $5,779,840 is in Pool A and $277,613 is in Pool B. Pool A
had a rating by Standard and Poor's Rating Services as "AAAm" on September 30, 2009 and amounts may be withdrawn without
penalty. Pool B participants are prohibited from making withdrawals. Pool B is not rated by any nationally recognized statistical
rating agency. Additional information regarding the Local Government Surplus Funds Trust Fund may be obtained from the State
Board of Administration.
Investment in the City's pension trust funds are limited by State Statutes Chapter 185 and by an investment policy adopted by the
fund's Board of Trustees on June 24, 2005. The allowable investment instruments include: United States government and agency
issues, bankers acceptances and certificates of deposit by United States banks, savings accounts with banks or other financial
institutions incorporated in the United States and commercial paper rated A-2 or P-2 or higher by Moody's or Standard and Poors. In
addition, common stocks of corporations listed on a recognized national stock exchange, plus issues convertible into common stock
are also allowed. No more than ten percent (] 01/o) of the cost value of total assets may be invested in foreign securities.
37
Custodial Credit Risk
The City's investment policy pursuant to Section 218.415(18), Florida Statutes requires securities, with the exception of certificates
of deposits, shall be held with a third party custodian; and all securities purchased by, and all collateral obtained by the City should
be properly designated as an asset of the City. The securities must be held in an account separate and apart from the assets of the
financial institution. A third party custodian is defined as any bank depository chartered by the Federal Government, the State of
Florida, or any other state or territory of the United States which has a branch or principal place of business in the State of Florida as
defined in Section 658.12, Florida Statutes, or by a national association organized and existing under the laws of the United States,
which is authorized to accept and execute trusts and which is doing business in the State of Florida. Certificates of deposits
maintained by book -entry at the issuing bank shall clearly identify the City as the owner.
As of September 30, 2010, the City's investment portfolio was held with a third -party custodian as required by the City's investment
policy.
Concentration of Credit Risk
The City's investment policy has established asset allocation and issuer limits on the following investments, which are designed to
reduce concentration of credit risk of the City's investment portfolio.
A maximum of 100% of available funds may be invested in the SBA and in the United States Government Securities, 50% of
available funds may be invested in United States Government agencies with a 25% limit on individual issuers, 80% of available
funds may be invested in Federal Instrumentalities with a 40% limit on individual issuers, 25% of available funds may be invested in
non-negotiable interest bearing time certificates of deposits with a 15% limits on individual issuers, 50% of available funds may be
invested in repurchase agreements excluding one (1) business day agreements and overnight sweep agreements with a 25% limit on
any one institution, 25% of available funds may be directly invested in prime commercial paper with a 10% limit on individual
issuers, 15% of available funds may be directly invested in corporate notes with a 5% limit on individual issuers, 25% of available
funds may be directly invested in Bankers' Acceptances with a 10% limit on individual issuers, 20% of available funds may be
invested in taxable and tax-exempt debts, 50% of available funds may be invested in money market mutual fund with a 25% limit on
individual issuers, 10% of available funds may be invested in intergovernmental investment pools.
The City's pension trust funds investment policy adopted by the fund's Board of Trustees has established asset allocation and issuer
limits on the following investments, which are designed to focus on performance. A maximum of 100% of available funds may be
invested in fixed income securities and a maximum of 50% of available funds may be invested in equity securities.
As of September 30, 2010, the City had the following issuer concentration based on fair value:
Govemment-wide
Eiduriary Funds
Percentage of
Percentage of
Issuer
Amount
Portfolio
Amount
Portfolio
Local government surplus funds trust
fund ("SBA")
$ 5,837,453
77.07%
$ 220,000
3.34%
United States Treasuries
-
-
399,758
6.07%
United States Agencies
-
-
1,068,413
16.23%
Municipal Obligations
-
-
102,963
1.56%
Certificate of deposit
1,736,484
22.93%
-
0.000/0
Domestic corporate bonds
-
-
I,493,858
22.69%
Domestic corporate equities
-
-
3,299,056
50.1 l%
Total
$ 7,573,937
100.00%
$ 6,584,048
I00.000/0
38
C. Receivable and Pavable Balances
Receivables
Receivables at September 30, 2010 were as follows:
Due From
Interest
Accounts
Other
Receivable
Receivable
Governments
Total
Governmental activities:
General
$ 199
$ 254,429
$ 239,359
$
493,987
Discretionary sales tax
142
-
198,890
199,032
Riverfront redevelopment
55
3,326
-
3,381
Other governmental
482
-
59,084
59,566
Total - governmental activities
$ 878
$ 257,755
$ 497,333
$
755,966
Business -type activities:
Airport
$ 2
$ 34,456
$ 57,593
$
92,051
Building
37
-
-
37
Total - business -type activities
$ 39
$ 34,456
$ 57,593
$
92,088
All receivables are anticipated to be collected.
Accounts Payable and Other Current Liabilities
Amounts at September 30, 2010 were as follows:
Governmental activities:
General
Riverfront redevelopment
Transportation improvements
Stormwater utility improvements
Other governmental
Total - governmental activities
Business -type activities:
Golf course
Airport
Building
Total - business -type activities
Salaries
Due to
and
Other
Vendors
Benefits
Government
Total
$ 148,760
$
383,246
$
15,065
$
547,071
6,129
-
-
6,129
5,190
-
-
5,190
83,678
-
-
83,678
61,403
-
-
61,403
$ 305,160
$
383,246
$
15,065
$
703,471
$ 11,944
$
15,846
$
5,835
$
33,625
74,548
10,125
358
85,031
753
17,111
-
17,864
$ 87,245
$
43,082
$
6,193
$
136,520
Governmental funds report deferred revenue in connection with receivables for revenues that are not considered to be available to
liquidate liabilities of the current period. Governmental funds also defer revenue recognition in connection with resources that have
been received, but not yet earned. At September 30, 2010, there was $1,132 reported as unearned revenues.
39
D. Capital Assets
Capital asset activity for the year ended September 30, 2010 was as follows
Beginning
Ending
Balance
Increases
Decreases
Balance
Governmental activities:
Capital assets, not being depreciated:
Land
$
5,699,045
$
2,308,392
$
-
$
8,007,437
Construction in progress
3,958,971
676,247
(3,684,074)
951,144
Total capital assets, not being depreciated
9,658,016
2,984,639
(3,684,074)
8,958,581
Capital assets, being depreciated:
Buildings
11,284,488
787,843
(10,620)
12,061,711
Improvements other than buildings
5,704,686
50,935
(17,075)
5,738,546
Machinery and equipment
7,784,213
282,778
(324,928)
7,742,063
Infrastructure
25,125,625
5,766,905
(950)
30,891,580
Total capital assets being depreciated
49,899,012
6,888,461
(353,573)
56,433,900
Less accumulated depreciation for:
Buildings
(2,670,647)
(386,986)
9,361
(3,048,272)
Improvements other than buildings
(1,907,223)
(283,866)
17,046
(2,174,043)
Machinery and equipment
(6,006,364)
(634,341)
324,928
(6,315,777)
Infrastructure
(10,299,510)
(1,177,722)
847
(11,476,385)
Total accumulated depreciation
(20,883,744)
(2,482,915)
352,182
(23,014,477)
Total capital assets, being depreciated, net
29,015,268
4,405,546
(1,391)
33,419,423
Governmental activities capital assets, net
$
38,673,284
$
7,390,185
$
(3,685,4651
$
42,378,004
Beginning
Ending
Balance
Increases
Decreases
Balance
Business -type activities:
Capital assets, not being depreciated:
Land
$
9,060
$
-
$
-
$
9,060
Construction in progress
207,059
3,690
(207,059)
3,690
Total capital assets, not being depreciated
216,119
3,690
(207,059)
12,750
Capital assets, being depreciated:
Buildings
5,082,120
1,110
-
5,083,230
Improvements other than buildings
1,940,103
8,241
(6,115)
1,942,229
Machinery and equipment
1,062,333
27,660
(56,554)
1,033,439
Infrastructure
6,237,799
1,240,177
-
7,477,976
Total capital assets being depreciated
14,322,355
1,277,188
(62,669)
15,536,874
Less accumulated depreciation for:
Buildings
(607,730)
(143,460)
-
(751,190)
Improvements other than buildings
(469,473)
(122,146)
6,778
(584,841)
Machinery and equipment
(667,835)
(119,350)
56,554
(730,631)
Infrastructure
(1,775,285)
(317,973)
-
(2,093,258)
Total accumulated depreciation
(3,520,323)
(702,929)
63,332
(4,159,920)
Total capital assets, being depreciated, net
10,802,032
574,259
663
11,376,954
Business -type activities capital assets, net
$
11,018,151
$
577,949
$
(206,3961
$
11,389,704
40
Depreciation expense was charged to functions/programs of the government as follows:
Governmental activities:
General government
$
267,412
Public safety
526,240
Transportation
615,551
Physical environment
703,098
Economic environment
6,533
Cultural and recreation
364,081
Total depreciation expense -governmental activities
$
2,482,915
Business -type activities:
Golf Course
$
87,910
Airport
602,249
Building
12,105
Total depreciation expense -business -type activities
$
702,264
Construction Commitments
The City has various construction commitments outstanding at September 30, 2010. The major commitments include the following:
Remaining
Major
Project
Spent -to -date
Commitment
Funding Source
Hardee Park Improvements
$ 14,295
$ 35,705
Recreation Impact Fees
Schumann Park Improvements
142,653
61,807
Recreation Impact Fees
Splash Park Canopy
-
50,000
Recreation Impact Fees
Skate Park Office
15,525
34,475
Recreation Impact Fees
Powerline Road
152,133
1,009,117
Contributions and DST (Discretionary Sales Tax)
512 Corridor Improvements
23,989
255,539
DST (Discretionary Sales Tax)
2010 Paving Note Improvements
13,026
I,237,435
LOGT (Local Option Gas Tax)
Other Paving Improvements
8,336
81,219
LOGT (Local Option Gas Tax)
Sidewalk/Bikepath Program
54,131
4,888
LOGT (Local Option Gas Tax)
Middle Stonecrop Improvements
191,862
190,439
Stormwater Fees
1/4 Round Swale Rehabilitation
1,654,139
43,581
DST (Discretionary Sales Tax)
Potomac Road Crossing
34,510
90,490
DST (Discretionary Sales Tax)
Airport Access Road
937,899
52,187
Grant and Airport Funds
Total
$ 3,242,498
$ 3,146,882
E. Advances
Advance balances at September 30, 2010 consisted of the following amounts:
Advance from General Fund to the Airport Fund $ 200,000
Advance from Discretionary Sales Tax Fund to the Airport Fund 285,000
Total $ 485,000
The balance of $285,000 advanced to the airport fund from the discretionary sales tax fund is to be repaid over a thirty year period in
accordance with Resolution No. R-08-20. The balance of $200,000 advanced to the airport from general fund represents a cash loan
made in 2007 without any specified terms for repayment.
4.1
F. Interfund Transfers
Transfers are used to 1) move revenues from the fund that statute or budget requires them to be collected in to the fund
that statute or
budget requires for them to be expended in, and 2) utilize discretionary sales tax revenues for infrastructure improvements and
equipment purchases which must be accounted for in other funds. Following is a schedule of Interfund Transfers:
Transfer Out:
Discretionary Stormwater Nonmajor
Sales Tax Riverfront Transportation Utility Governmental
Transfers In: Fund Redevelopment Improvements Improvements Funds
Total
General Fund $ $ 60,000 $ - $ - $ 704,888
$ 764,888
Discretionary Sale Tax Fund - 37,446 522,000 -
559,446
Riverfront Redevelopment III - -
III
Transportation Improvements 90,145
90,145
Stormwater Utility Improvements 1,148,218 - - 80,987
1,229,205
Nonmajor Governmental Funds 1,344,424 9,829 39 488,539
1,842,831
Airport - - - - 7,020
7,020
Total Transfers Out $ 2,492,642 $ 69,829 $ 37,596 $ 522,000 $ 1,371,579
$ 4,493,646
G. Leases
1. Oaeratine Leases -Lessee
The City is obligated under certain leases for land and golf carts accounted for as operating leases. Operating leases do not give rise
to property rights or lease obligations. Total costs for such leases were $197,873 for the fiscal year ended September 30, 2010.
These include the Airport Proprietary Fund's lease obligation for the property used as the City's golf course. The following is a
schedule by years for future minimum rental payments required under operating leases in the Golf Course Proprietary fund that have
initial or remaining noncancelable lease terms in excess of one year as of September 30, 2010:
Year Endine September 30.
2011
2012
2013
2014
2015
Total s
2. Oaeratine Leases -Lessor
Golf Course
Golf
to: Airport
Carts
135,000
62,935
135,000
62,935
135,000
160,890
135,000
-
13 5,000
-
$ 675,000 $
286,760
The City is the lessor in two communication tower leases with lease terms of up to fifty-five years. The towers have a cost of $39,285
and a carrying value of $6,810. For fiscal year 2010, total depreciation expense for the leased tower is $1,865. Following is a
schedule by year of minimum future rental income on noncancelable operating leases:
Governmental
Year Endine September 30,
Activities
2011
62,182
2012
66,326
2013
67,641
2014
69,008
2015
70,430
2016-2020
389,374
2021-2025
355,004
2026-2030
389,161
2031-2035
455,947
2036-2040
537,202
2041-2045
636,061
2046-2050
756,338
2051-2055
902,674
Total minimum future rentals
$ 4,757,348
42
The airport is the lessor of various properties (land with a cost basis of $9,060) with lease terms varying from twenty to thirty years.
These include the lease to the Golf Course Proprietary Fund requiring annual payments of $135,000 through 2015. Following is a
schedule by year of minimum future rental income on noncancelable operating leases:
Business -type
Year Ending Septemher 30_
Activities
2011
413,071
2012
416,964
2013
420,957
2014
425,051
2015
414,319
2016-2020
798,779
2021-2025
829,535
2026-2030
689,987
2031-2035
620,284
Total minimum future rentals
$ 5,028,947
H. Long-term Obligations
1. Revenue Bonds/Notes
Revenue bonds/notes are secured by and payable from the revenues of the respective funds that issued them.
a. The City entered into a twelve (12) year loan agreement in 2010 with a local bank for $2,462,000 to provide financing to
repave certain roads in the City and payoff an outstanding loan. The City pledged Local Option Gas Tax and Municipal
Gas Tax to repay the note payable. The funds are accumulated in the Local Option Gas Tax Special Revenue fund for
repayment of principal and interest.
b. The City issued a fifteen (15) year, $9,500,000 Infrastructure Sales Surtax Revenue Bonds, Series 2003 in April 2003. The
City has pledged Infrastructure Sales Surtax revenues for repayment of principal and interest.
C. The City issued a fifteen (15) year, $2,125,000 Infrastructure Sales Surtax Revenue Bonds, Series 2003A in December
2003. The City has pledged Infrastructure Sales Surtax revenues for repayment of principal and interest.
d. The City issued a nineteen (19) year, $5,630,000 Stormwater Utility Revenue Bonds, Series 2003 in November 2003, The
City has pledged Stormwater Fee Revenues along with a covenant to budget and appropriate for repayment of principal and
interest.
2. Bond Coverage
The City has covenanted in the Stormwater Utility Revenue Bonds, Series 2003 Bond Resolution to fix, establish, maintain and
collect stormwater fees, and revise the same from time to time whenever necessary, so as to always provide in each fiscal year
stormwater fee revenues and investment earnings equal to at least one hundred thirty-five percent (135%) of the annual debt
service becoming due in each fiscal year.
The following table indicates the degree of compliance with the bond resolution covenants in the stormwater utility fund at
September 30, 2010.
Gross revenues available for compliance $ 858,664
Debt service requirement $ 437,485
Percent coverage for the year
ended September 30, 2009 196%
43
3. Changes in Long-term Liabilities
The following is a summary of changes in Long -Term Liabilities of the City for the year ended September 30, 2010:
Beginning Ending Due within
Balance Additions Reductions Balance One Year
Governmental activities:
Bonds payable:
Infrastructure Sales Surtax Revenue
Bonds, Series 2003
Infrastructure Sales Surtax Revenue
Bonds, Series 2003A
Stormwater Utility Revenue Bonds,
Series 2003
Less deferred amount:
Issuance discount- Stormwater Utility Revenue
Bonds, Series 2003
Total bonds payable
Notes payable
Compensated absences
Unfunded OPEB obligation
Termination benefits
Pollution Remediation Liability
Governmental activity
long -tern liabilities
Business -type activities:
Bonds payable:
Recreational Facilities Improvement and
Refunding Revenue Bonds, Series 2001
Less deferred amount:
Issuance premium
Loss on refunding
Total bonds payable
Compensated absences
Unfunded OPEB obligation
Termination benefits
Business -type activity
long-term liabilities
$ 6,255,000
$
$
600,000
$ 5,655,000
$ 620,000
1,470,000
145,000
1,325,000
145,000
4,315,000
260,000
4,055,000
270,000
(10,416)
(833)
(9,583)
-
12,029,584
-
1,004,167
11,025,417
1,035,000
1,089,203
2,462,000
1,137,203
2,414,000
168,000
1,245,805
850,741
444,755
1,651,791
199,249
304,288
6,253
-
310,541
-
21,879
2,244
24,123
13,464
91,200
-
-
91,200
-
$ 14,781,959
$ 3,321,238
$
2,586,125
$ 15,5I7,072
$ 1,415,713
Beginning
Ending
Due within
Balance
Additions
Reductions
Balance
One Year
$ 300,000
$ -
$
300,000
$ -
$
796
796
(8,320)
(8,320)
292,476
-
292,476
-
194,807
61,831
65,260
191,378
11,111
40,694
-
11,470
29,224
-
6,171
-
6,171
-
-
$ 534,148
$ 61,831
$
375,377
$ 220,602
$ 11,1II
For the governmental activities, compensated absences are generally liquidated by the general fund.
A pollution remediation obligation was recorded for a Florida Department of Environmental (FDEP) Order dated March 10, 1997.
This was related to an incident of petroleum contamination at the Public Works Department on April 22, 1991. The City was named
as the party responsible for the cleanup but FDEP determined the discharge is eligible under the Petroleum Cleanup Participation
Program and will not compel site rehabilitation prior to funding becoming available from that program. The program has a funding
cap of $400,000, with a 25% required cost share percentage. The City must also pay for a limited contamination assessment report
sufficient to determine the extent of the contamination and cleanup. Based on the information available, the City estimated its
expenditure to be $91,200 dependent on the extent of work that is eventually required and recorded a long-term liability of $91,200.
44
4. Debt Service Requirements to Maturitv
The annual requirement to amortize all bonded debt outstanding at
September 30, 2010, including interest requirements, is as
follows:
Governmental
Activities
Roadway Infrastructure
Infrastructure Storrnwater
Improvement SalesSurtax
SalesSurtax Utility
Note Revenue Bonds,
Revenue Bonds, Revenue Bonds,
Fiscal Payable Series 2003
Series 2003A Series 2003
Year 4.01 % Interest 2% to 4.125% Interest
2% to 4% Interest 2% to 4.5% Interest
2011 $ 168,000 $ 96,463 $ 620,000 $ 203,816
$ 145,000 $ 48,788 $ 270,000 $ 169,089
2012 176,000 89,792 645,000 181,828
150,000 43,531 280,000 159,248
2013 182,000 82,335 665,000 158,243
155,000 37,906 290,000 148,048
2014 190,000 74,855 690,000 133,169
160,000 31,800 305,000 136,448
2015 198,000 67,049 715,000 106,646
170,000 25,200 315,000 125,010
2016-2020 1,118,000 206,658 2,320,000 143,743
545,000 33,100 1,775,000 423,335
2021-2023 382,000 15,647 - -
- - 820,000 55,800
$ 2,414,000 $ 632,799 $ 5,655,000 $ 927,445
$ 1,325,000 $ 220,325 $ 4,055,000 $ 1,216,978
I. Restricted Assets:
Certain cash and claims to cash, that are legally restricted, have been shown
as restricted in the statement of net assets as follows:
Govermental
Activities
Debt service
$ 1,737,605
Capital
3,422,728
Cemetery perpetual care
859,463
Other expenditures
2,737,247
Total
$ 8,757,043
The government -wide statement of net assets reports $8,757,043 of restricted net assets, of which all are within governmental
activities and are restricted by constraints placed by creditors, grantors,
contributors, or laws or regulations of other governments or
imposed by law through constitutional provisions or enabling legislation.
J. Fund Balances:
The balance sheet for governmental funds presents fund balances in specifically
defined classifications, which are detailed as follows:
Nonspendable:
Inventory
$ 65,728
Prepaid items
86,520
Advance to other funds
200,000
Permanent funds
859,463
Total
$ 1,211,711
Restricted:
Debt service funds
$ 1,737,605
Special revenue funds
5,222,652
Capital project funds
937,323
Total
$ 7,897,580
Committed:
Working capital
$ 2,613,585
Emergency services reserve
350,000
Property casualty claims
100,000
Total
$ 3,063,585
Assigned:
General employee events
$ 4,900
Law enforcement events
2,693
Greer donations for police
24,063
Total
$ 31,656
Unassigned:
General fund residual
$ 2,464,910
45
When expenditures are incurred for purposes for which other classified amounts could be used, the City considers restricted amounts
are used first, followed by committed, then assigned, and then unassigned.
Nonspendable amounts cannot be spent because they are not in spendable form.
Restricted amounts include balances in the debt service, special revenue and capital project funds that must be used in accordance
with constraints placed by creditors, grantors or other governments.
Committed amounts consist of items specified in a financial policies resolution that is adopted annually by the City Council that are
to be set aside in the general fund. The financial policies state that 25% of general fund expenditures will be for working capital. in
addition, it says an emergency services reserve will be maintained to ensure continue operations of programs should a natural disaster
or significant changes in the weather pattern occur. Furthermore, it says a property/casualty claims amount will be set aside for
deductibles incurred on claims not covered by insurance policies. Changes to these commitments would have to be made with
another resolution.
Assigned amounts more specific purposes are established by direction of the City Manager, who is accountable to the City Council to
provide proper accounting of all transactions.
Unassigned amounts is the residual classification for the general fund but may also include a negative fund balance in other
governmental funds caused by an excess of amounts restricted, committed, or assigned to those purposes.
V. OTHER INFORMATION
A. Property Tax
The City is permitted by State law to levy taxes up to 10 mills on assessed valuation. The millage rate levied by the City for the
fiscal year ended September 30, 2010, was 3.3456 mills. Total tax collections were approximately 95.8% of the total tax levy.
The tax levy of the City is established by City Council. Under Florida law, the assessment of all properties and the collection of
municipal taxes are provided by offices of the County's Property Appraiser and Tax Collector. Ad Valorem taxes are levied on
property values as of January 1. The fiscal year for which taxes are levied begins October 1. Taxes are due November 1 and become
delinquent on April 1. All taxes unpaid as of May 30 are subject to a tax certificate sale. Property tax revenues are recognized in the
fiscal year for which they are levied and also become due and payable.
B. Grants from Other Governmental Units
Federal, State and local government grants represent an important source of supplementary funding used to finance infrastructure,
recreation, law enforcement, and environmental activities beneficial to the community. These grants are recorded in the General,
Special Revenue, Capital Project, and Enterprise funds. A grant receivable is recorded when the project funds have been expended
and the City has a right to reimbursement and expects to receive the grant within a year under the related grant. The grants normally
specify the purpose for which the funds may be used and are subject to audit by the grantor agency or its representative.
The following is the amount of grant revenue for fiscal year 2010.
Amount
Public safety $ 37,052
Transportation 18,559
Economic environment 2,556,872
Airport 904,853
Total reporting entity $ 3,517,336
C. Police Pension Plan - Defined Benefit Plan
Plan Description. The Police Officers' Pension Plan is a Florida Statute Chapter 185 single -employer defined benefit plan. Only
City police officers participate in the Police Pension Plan. The state provides a contribution to the Police Pension Plan through a
distribution of funds collected from insurance premium taxes. The Pension plan data provided in these Financial Statements are from
the actuarial valuation as of October 1, 2008 to determine the required contribution for the fiscal year ending September 30, 2010.
Although the Police Officers' Pension Plan provides separate reporting, which may be obtained in the Finance department, it is also a
component unit (reporting as a Pension Trust Fund) of the City's financial reporting entity.
M
Employee membership data as of the October 1, 2008 actuarial valuation is as follows:
Retirees and beneficiaries currently receiving benefits 4
Terminated employees entitled to refund of employee
Contribution but not yet received 1
Fully, partially, and non -vested active plan participants 38
Total 43
Benefit Provisions and Contribution Requirements. The Police Officers' Pension Plan provides retirement and disability benefits to
plan members and beneficiaries. This Plan is administered by a separate local Board of Trustees. Chapter 185, Florida Statutes, as
amended governs all benefit provisions of the Plan. Contribution requirements, in accordance with Chapter 185, Florida Statutes, are
established by City ordinance, as provided in Chapter 58, Article III of the Sebastian City Code. The City Council has the authority
to amend funding requirements.
Funding Policy. The employer, employee, and State contribution requirements are applicable to the Plan and actuarially determined
on a frequency of at least every 3 years in accordance with Florida State Statute. Administration costs of the pension plan are
financed by the Plan. For the 2009-2010 fiscal year, the employee contribution rate, expressed as a percentage of compensation, was
5.0% and the employer contribution rate was 24.7%. The employer contribution amounted to $566,910. The State contribution was
5134,852, which represents state shared revenue that is levied on property and casualty insurance premiums and collected by the
State. The State contribution was recognized and recorded in the general fund and the corresponding expenditure was recorded as
public safety expenditure. The City is required to contribute the remaining amounts to ensure that the Plan is actuarially sound.
Annual pension costs and related information provided for disclosure in the October 1, 2010 actuarial valuation was as follows:
Contribution rates as of 9/30/10:
City
Plan members
Annual pension cost
Contributions made
Valuation date
Actuarial cost method
Amortization method
Remaining amortization period
Asset valuation method
Actuarial assumptions:
Investment rate of return
Projected salary increase*
*Includes inflation at
Post retirement COLA
24.7%
5.0%
$ 567,146
$ 566,910
10/1/2008
Frozen Entry Age
Level Percentage of Pay, Closed
24 Years (as of 10/01/2008)
Market Value
8.0%
6.0%
3.0%
0.0%
Required trend information for the Police Officers' Pension Plan was as follows:
Actuarially
Year
Required
Ending
Contribution
9/30/2010
$ 567,146
9/30/2009
$ 419,657
9/30/2008
$ 334,128
Percentage
Net
of APC
Pension
Contributed
Obligation
100%
$ (141,337)
96%
$ (146,254)
113%
$ (165,630)
The annual required contribution for the Police Officers' Pension Plan was determined as part of the October 1, 2008, actuarial
valuation using the aggregate actuarial cost method. This method does not identify or separately amortize unfunded actuarial accrued
liabilities. The actuarial assumptions included (a) an 8.0% rate of return (net of administrative costs) and (b) projected salary
increases of 6% per year, including inflation at 3%.
Reserves. All of the net assets of the Police Pension Plan are legally reserved for plan participant benefits.
Basis of Accounting. Financial statements are prepared using the accrual basis of accounting. Plan member contributions are
recognized in the period in which the contributions are due. Employer contributions are recognized when due, and the employer has
made formal commitment to provide the contributions. Benefits and refunds are recognized when due and payable in accordance
with the terms of the Plan.
Method Used to Value Investments and Concentration oflnvestments. Investments are reported at fair value. Short-term investments
are reported at cost, which approximates fair value. Securities traded on a national or international exchange are valued at the last
reported sales price at current exchange rates. Mortgages are valued on the basis of future principal and interest payments, and are
discounted at prevailing interest rates for similar instruments. Investments that do not have an established market are reported at
estimated fair value. Investments in securities of a single organization (excluding mutual funds and those issued or guaranteed by the
U.S. government) held by the pension plan did not exceed five percent of the total plan assets.
47
Development of Net Pension Obligation (NPO)
This municipal Defined Benefit Plan has been subject to the minimum funding standards since the adoption of the "Florida Protection
of Public Employee Retirement Benefit Act" (Part VII of Chapter 112, Florida Statutes) in 1980. Accordingly, the sponsor has
funded the actuarially determined required contributions for all years from October I, 1987, through the transition date, October 1,
1997. Thus, the NPO on October 1, 1997, is $0.
The development of the Net Pension Obligation as provided for disclosure by the actuary is as follows:
9/30/2007
9/30/2008
9/30/2009
9/30/2010
Actuarially Determined Contribution (A)
$ 289,390 $
334,128 $
419,657
$ 567,146
Interest on NPO
(9,753)
(9,948)
(13,250)
(11,700)
Adjustment to (A)
12,454
11,314
17,073
16,380
Annual Pension Cost
292,091
335,494
423,480
571,826
Contributions made
294,534
376,769
404,104
566,910
Increase in NPO
(2,443)
(41,275)
19,376
4,916
NPO beginning ofyear
(121,912)
(124,355)
(165,630)
(146,254)
NPO end ofyear
$ (124,355) $
(165,630) $
(146,254)
$ (141,338)
Multi -year trend information about whether the actuarial value of plan assets is increasing or decreasing relative to the actuarial
accrued liability for benefits over time is presented in the required supplemental information section on page 56.
D. CWA / ITU Negotiated Pension Plan —Defined Benefit Plan
Plan Description: The CWA/ITU Negotiated Pension Plan (NPP), which began in 1967, is a multi -employer, defined benefit plan.
The Plan is available to any Communication Workers of America (CWA) bargaining unit member, and benefits are portable from one
contributing employer to another.
Normal Pension: Minimum age 65: 5 years of Service Credit required if any portion of service credit was earned after January I,
1989. 10 years of Service Credit required if employees' coverage ended before January 1, 1989. Once the Service Credit amount is
accrued, the employee is vested and cannot lose the right to a pension.
Early Pension: Minimum age 60: 20 years of Service Credit required if employed after January 1, 1989. 25 years of Service Credit
required if employment ended before January 1, 1993. Pension amounts are permanently reduced based on age on the effective date,
because the payments are expected to be made for a longer period of time.
Disability Pension: No minimum age and the pension amount is not reduced for age; there must be a Social Security Disability
Award, 10 years of actual Service Credit and a contribution for covered employment must have been made within five calendar years
preceding the entitlement date to Social Security Disability Pension. An application must be filed with the Plan within 6 months of
the Social Security Notice of Award date to receive pension retroactive to the Social Security entitlement date.
Lump Sum Disability Benefit: If the employee is in receipt of a Social Security Disability Award and is vested, but not immediately
eligible to receive any pension described above, the employee may be eligible for a lump sum equal to total contributions credited on
the employees behalf (or 36 times the Normal Pension amount, if greater). If the employee is immediately eligible for a pension but
not yet receiving one, the employee can still qualify for a lump sum if the employee submits two physicians' written statements that
the disability will lead to death within one year of the date of application.
Death Benefit: If the employee dies before becoming a pensioner and has at lease $250 contributed on the employees' behalf, a lump
sum death benefit equal to total contributions credited on the employees' behalf or 36 times the Normal Pension amount, if greater,
will be paid to employees' beneficiary. If the employee is married at the time of death, the spouse will have the choice of a lump sum
or a monthly survivor benefit.
Withdrawal Benefit: If the employee did not earn enough Service Credit to qualify for a Normal Pension, the employee may be
eligible for a lump sum withdrawal benefit, based on total contributions, after the employee has incurred a break in service.
Benefit Provisions and Contribution Requirements: The NPP provides retirement and disability benefits to plan members and
beneficiaries. The plan is administered at the Plan Office in Colorado Springs, Colorado. Contribution requirements are established
by the CWA contract, effective date October 1, 2006, which is negotiated every 3 years, and approved by City Council.
Funding Policy: Administration costs of the pension plan are financed by the plan. The employer contribution rate, expressed as a
percentage of compensation, was 9.00% for the 2009-20I0 fiscal year. Employees do not contribute to this plan. Contributions to the
CWA Pension Plan for the fiscal years ended September 30, 2008, 2009 and 2010 were $241,718, $254,997, and $234,2I9
respectively, which are equal to 100% of the required contribution for each year.
.M
E. 401 Plan — Defined Contribution Plan
Plan Description: The ICMA Retirement Corporation's 401 Retirement Plan is a Defined Contribution Plan "qualified" under
Section 401 (a) of the Internal Revenue Code. Each participant has a plan account to which contributions are made. Plan benefits are
based on the total amount of money in the employees' account at retirement or other eligible event. The Plan is available to all
management staff and may be rolled over to another "qualified" employer plan that accepts rollovers, or Traditional IRA's.
Periodic Payments: Retirement benefits can be paid monthly, quarterly, semi-annual (at six-month intervals only) or annual
payments until assets are fully paid out.
Rollover: Retirement benefits can be rolled over to another employer plan (including a 457 deferred compensation plan) that accepts
rollovers, or to a Traditional IRA.
Lump Sum: Retirement benefits can paid either partially or by total distribution of the employees' account balance.
Annuities: Retirement benefits can be utilized to purchase an annuity.
Benefit Provisions and Contribution Requirements: The 401 provides retirement benefits to plan members and beneficiaries. The
plan is administered by the ICMA Retirement Corporation. Contribution requirements are established by the City of Sebastian,
Management Benefit Package, revised October 1, 2006, and approved by the City Manager.
Funding Policy: Administration costs of the pension plan are financed by the Plan. The employer contribution rate, expressed as a
percentage of compensation, was 9.00% for the 2009-2010 fiscal year. Employees do not contribute to this Plan. Contributions to
the 401 Defined Contribution Plan for the fiscal years ended September 30, 2008, 2009, and 2010 were $145,596, $152,078, and
$126,377 respectively, which are equal to 100% of the required contribution for each year.
F. Other Post Emplovment Benefits (OPEB)
Pursuant to Section 112.0801, Florida Statutes, the City is required to permit participation in the health insurance program by retirees
and their eligible dependents at a cost to the retiree that is no greater than the cost at which coverage is available for active
employees. The City, by policy, has elected to provide qualified retirees with partial subsidy. In this respect, the City operates a
single -employer plan.
Employees are eligible to receive benefits from the Retiree Medical Plan upon retirement, if they are enrolled in the active medical
plan immediately prior to retiring and achieved at least 20 years of service in a full time capacity. The City pays 50% of the costs of
single coverage group health insurance for up to 2 years after retirement. No retirees are currently receiving medical benefits.
Based on GASB Statement 43 and 45, which set forth the guidelines for treatment of Other Post Employment Benefits, the City had
an actuary calculate future funding requirements in 2007. The actuary's 2007 estimate, using the Projected Unit Credit Method,
produced an unfunded obligation of $281,842 and an annual required contribution of $40,089. The City elected to fund the OPEB
obligation on a pay-as-you-go basis. The entire unfunded obligation was recognized in the government -wide financial statements.
The enterprise fund portion ($33,365) was also recognized in the enterprise fund financial statements. As such, a separate audited
GAAP basis postemployment benefit plan report is not available. In 2008 and 2009, the City recorded an additional government -
wide obligation of $30,943 and $32,197, respectively, based on the annual required contribution reduced by the expected future
benefit payments. The additional enterprise fund portion was calculated as $3,592 in 2008 and $3,737 in 2009. The City had an
actuary calculate the OPEB obligation for 2010 and recognized a reduction in the government -wide obligation of $5,217. The
enterprise fund portion was calculated as a decrease of $1 I,470. The actuarial assumptions included the following:
Amortization period — Open, level percentage of compensation over a 30 year period.
Retirement age for active employees — Based on historical average.
Mortality — RP-2000 Combined Healthy Mortality Table projected to 2010.
Turnover — Historical data by age.
Healthcare cost trend rate — nine percent (9%) in 2010, decreasing to five percent (5%) in 2017.
Health insurance premiums — Actual 2010 premiums were used to calculate the values of benefits to be paid.
Payroll growth rate — three percent (3%) per year.
Inflation rate — three percent (3%) per year.
Interest rate — four percent (4%) rate of return on invested assets, to reflect the long-term expectation of investment returns.
.•
The determination of the Net Other Post Employment Benefit obligation (OPEB) is as follows:
Annual required contribution
Interest on Net OPEB obligation
Adjustment to annual required contribution
Annual OPEB cost
Less assumed contributions
Increase (decrease) in net OPEB obligation
Net OPEB obligation - beginning of year
Net OPEB obligation - end of year
Percentage of annual OPEB cost contributed
G. Termination Benefits
9/30/2008 9/30/2009 9/30/2010
$ 40,089 $ 40,089 $ 26,557
- - 13,799
(13,182)
40,089 40,089 27,174
9,146 7,892 32,391
30,943 32,197 (5,217)
281,842 312,785 344,982
$ 312,785 $ 344,982 $ 339,765
23% 20% 119
The City offered its employees an early retirement incentive program in 2006-2007 fiscal year. The eligibility requirements were that
the employee was either an exempt management employee or an hourly employee including police officers with at least 15 years of
service in a full time capacity and within three years of reaching the age of 65 (the age eligible for Medicare benefit). The benefits
include a one time lump sum payment based on the year of service and single coverage group health insurance for up to 3 years after
retirement. The lump sum payment was calculated by multiplying $1,000 for each full year of service. The group health insurance
will terminate when the retiree reaches the age of 65 and eligible for Medicare benefits. As of September 30, 2010, the total accrued
termination benefits for the government -wide financial statements were $24,123. No portion of the accrued termination benefits
related to the enterprise funds.
H. Insurance
The City is exposed to various risks of loss related to torts; theft of or damage to and destruction of assets; errors and omissions; and
natural disasters. The City purchases commercial insurance with various deductibles for different types of losses. The cost of this
insurance is accounted for in the general fund, golf course fund, airport fund, and building fund. Settled claims have not exceeded
this commercial coverage in the past three fiscal years.
I. Litigation
Various suits and claims are currently pending against the City. It is impossible for the City to accurately quantify the exposure
involved given the jury's latitude in assessing compensatory and punitive damages, and the court's latitude in awarding attorney's
fees. The City intends to vigorously defend against these lawsuits and believes it has a good chance of prevailing on their merits.
The City is contingently liable with respect to lawsuits and other claims incidental to the ordinary course of its operations. In the
opinion of management and based on the advice of legal counsel, the ultimate disposition of lawsuits will not have a material adverse
effect on the financial position of the City.
J. Grants
Amounts received or receivable from grantor agencies are subject to audit and adjustment by grantor agencies. If any expenditures
were disallowed as a result of these audits, the claims for reimbursement to the grantor agency would become a liability of the City.
In the opinion of management, any such adjustments would not be significant.
50
Required Supplemental Information
51
City of Sebastian, Florida
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual
General Fund
For the Year Ended September 30, 2010
Actual
Variance with
Budget Amounts
Amounts on
Final Budget -
a Budgetary
Positive
Original
Final
Basis
(Negative)
REVENUES:
Taxes:
Property
$ 3,704,546 $
3,704,546
$ 3,734,398
$ 29,852
Public utility
2,474,668
2,474,668
2,437,050
(37,618)
Franchise fees
1,352,216
1,352,216
1,228,692
(123,524)
Licenses and permits
51,400
51,400
33,182
(18,218)
Intergovernmental
1,694,776
1,857,957
1,997,119
139,162
Charges for services
289,147
289,147
282,530
(6,617)
Fines
55,000
55,000
71,415
16,415
Investment earnings
220,000
220,000
127,524
(92,476)
Contributions and donations
24,350
24,350
13,442
(10,908)
Other revenue
178,840
178,840
145,929
(32,911)
Total revenues
10,044,943
10,208,124
10,071,281
(136,843)
EXPENDITURES:
Current:
General government
2,820,407
2,820,407
2,717,290
103,117
Public safety
4,647,459
4,959,722
4,968,164
(8,442)
Physical environment
1,309,392
1,309,392
1,198,164
111,228
Transportation
1,100,399
1,100,399
1,125,067
(24,668)
Culture and recreation
1,016,195
1,016,195
983,199
32,996
Total expenditures
10,893,852
11,206,115
10,991,884
214,231
Excess (deficiency) of revenues
over (under) expenditures
(848,909)
(997,991)
(920,603)
77,388
OTHER FINANCING SOURCES
Transfers in
764,888
764,888
764,888
-
Total other financing sources
764,888
764,888
764,888
-
Net changes in fund balances
(84,021)
(233,103)
(155,715)
77,388
Fund balances - beginning
5,768,114
5,768,114
5,768,114
-
Fund balances - ending
$ 5,684,093 $
5,535,011
$ 5,612,399
$ 77,388
The accompanying notes to required supplementary information are an integral part of this schedule.
52
City of Sebastian, Florida
Schedule of Revenue, Expenditures, and Changes in Fund Balances - Budget and Actual
Discretionary Sales Tax Special Revenue Fund
For the Year Ended September 30, 2010
Actual
Budget Amounts
Amounts on
a Budgetary
Original
Final
Basis
REVENUES:
Taxes:
Sales
$ 2,460,000 $
2,460,000
$ 2,328,150
Investment earnings
50,445
50,445
25,465
Total revenues
2,510,445
2,510,445
2,353,615
OTHER FINANCING SOURCES (USES)
Transfers in
484,554
484,554
5597446
Transfers out
(2,883,210)
(2,883,210)
(2,492,642)
Total other financing sources (uses)
(2,398,656)
(2,398,656)
(1,933,196)
Net changes in fund balances
111,789
111,789
420,419
Fund balances - beginning
958,676
958,676
958,676
Fund balances - ending
$ 1,070,465 $
1,070,465
$ 1,379,095
Variance with
Final Budget -
Positive
(Negative)
$ (131,850)
(24,980)
(156,830)
74,892
390,568
465,460
308,630
$ 308,630
The accompanying notes to required supplementary information are an integral part of this schedule.
53
City of Sebastian, Florida
Schedule of Revenue, Expenditures, and Changes in Fund Balances - Budget and Actual
Riverfront Redevelopment Agency Special Revenue Fund
For the Year Ended September 30, 2010
REVENUES:
Taxes:
Property
Intergovernmental
Investment earnings
Other revenue
Total revenues
EXPENDITURES:
Current:
Economic environment
Total expenditures
Excess of revenues over
over expenditures
OTHER FINANCING SOURCES (USES)
Transfers in
Transfers out
Total other financing sources (uses)
Net changes in fund balances
Fund balances - beginning
Fund balances - ending
Actual
Variance with
Budget Amounts
Amounts on
Final Budget -
a Budgetary
Positive
Original
Final
Basis
(Negative)
$ 437,768 $
437.768
$ 429,730
$ (8,038)
-
-
2,556,872
2,556,872
2,767
2,767
3,056
289
-
-
3,781
3,781
440,535
440,535
2,993,439
2,552,904
692,638
692,638
3,225,768
(21533,130)
692,638
692,638
3,225,768
(2,533,130)
(252,103)
(252,103)
(232,329)
19,774
-
-
III
III
(69,830)
(69,830)
(69,829)
1
(69,830)
(69,830)
(69,718)
112
(321,933)
(321,933)
(302,047)
19,886
984,638
984,638
984,638
-
$ 662,705 $
662,705
$ 682,591
$ 19,886
The accompanying notes to required supplementary information are an integral part of this schedule.
54
City of Sebastian, Florida
Notes to the Required Supplementary Information — Budget Comparisons
September 30, 2010
A. BudEetary Basis
Annual budgets are adopted for all governmental funds except the capital project funds, which are approved on a "life of
the project basis", and the permanent fund, which is not budgeted. Since all accounting principles applied for purposes
of developing data on a budgetary basis differ significantly from those used to present financial statements in conformity
with U.S. generally accepted accounting principles, reconciliations of the resultant timing differences have been
provided on page 51 through page 54. All annual appropriations lapse at year-end.
B. Budeetary Information
The appropriated budget is prepared by fund, function, and department. The government's department heads, with the
City Manager's approval, may make transfers of appropriations within a department or division. Shifts in appropriations
within fund totals may be done on the authority of the City Manager. Transfers of appropriations between funds require
approval of the City Council. The legal level of budgetary control (i.e., the level at which expenditures may not legally
exceed appropriations made by the City Council) is the fund level. The City Council made four supplementary
budgetary appropriations throughout the year. The 1st quarter budget amendment highlighted an increase of $715,923 to
cover transfers for unfinished capital projects that were carried forward from the prior fiscal year. The 2"d quarter budget
amendment highlighted an increase of $2,349,006 related to the pay off of the former bank note and to establish
appropriations necessary for the new bank note. The 3`d quarter budget amendment made adjustments of $30,036 to a
couple of capital projects. The 4th quarter budget amendment highlighted an increase of $283,934 to the amounts
budgeted for payment to the Police Officers' Pension Fund.
C. Budgeted Expenditures Exceeded Revenues
Budgeted expenditures exceeded revenues in the general fund, riverfront redevelopment special revenue fund and the
local option gas tax special revenue fund. However, this is pursuant to the legally adopted budget to expend available
fund equity (cash carry forward) and does not constitute a deficit.
55
City of Sebastian, Florida
REQUIRED SUPPLEMENTARY INFORMATION
Police Officers' Pension Plan
Governmental Accounting Standards Board Statements No. 25 and 27, Financial Reporting for Defined Benefit Pension Plans
and Note Disclosures for Defined Contribution Plans and Accounting for Pensions by State and Local Governmental Employers
require supplementary information be reported on the local
pension plans in addition to that provided in the Notes to the
Financial Statements. This information, as amended
by Statement No. 50, is presented in the
following schedules:
SCHEDULE OF
FUNDING PROGRESS
Actuarial
Accrued
UAAL as
Actuarial
Liability
Unfunded
a % of
Actuarial Value of
(AAL)
AAL Funded)
Covered) Covered
Valuation Assets
- Entry Age
(UAAL) Ratio
Payroll Payroll
Date (a)
(b)
(c) (a/b)
(c) ((b-a)/c)
10/1/2010 $ 7,086,302
$ 7,824,780
$ 738,478 90.56%
$ 2,313,473 31.92%
10/1/2008 5,474,816
6,127,531
652,715 89.35%
2,143,131 30.46%
10/1/2006 4,711,294
5,389,815
678,521 87.41%
1,769,613 38.34%
10/1/2004 3,536,724
4,251,736
715,012 83.18%
1,480,974 48.28%
10/1/2002 2,616,301
3,336,111
719,810 78.42%
1,184,967 60.75%
SCHEDULE
OF CONTRIBUTIONS
FROM THE EMPLOYER
AND OTHER CONTRIBUTING
ENTITIES
Annual
Fiscal
Required
City State
Percentage
Year
Contributions
Contribution Contribution
Contributed
2010
$ 701,998
$ 566,910 $ 134,852
99.97%
2009
557,439
404,104 137,782
97.210/.
2008
456,928
376,769 122,800
109.33%
2007
407,011
294,534 117,621
101.26%
2006
360,922
219,898 117,621
93.52%
2005
330,257
240,166 117,621
108.34%
Other Post EmWovment Benefits (OPEB)
Governmental Accounting Standards Board Statements No. 43 and 45, Reoortine for Postemplovment Benefit Plans Other Than
Pension Plans and Accountine and Financial Reportine by Emplovers for Postemplovment Benefits Other Than Pensions,
establishes accounting and reporting requirements for state and local government employers that provide OPEB. This
information is presented in the following schedule:
SCHEDULE OF FUNDING PROGRESS
Actuarial
Actuarial
Accrued
Unfunded
Value of
Liability
AAL
Funded
Fiscal
Assets
(AAL)
(UAAL)
Ratio
Year
(a)
(b)
(e)
(a/b)
2010
$
$
306,554
$ 306,554
0.00%
2009
377,118
377,118
0.00%
2008
343,587
343,587
0.00%
SCHEDULE
OF CON [-RIBt,'I
IONS hROWIFIE EMPLOYER
Annual
Fiscal
Required
City
Percentage
Year
Contributions
Contribution
Contributed
2010
$ 26,557
$ 26,557
100.00%
2009
40,089
40,089
100.00%
2008
40,089
40,089
100.00%
Note: The City has elected to fund the OPEB on a pay-as-you-go basis.
Nonmajor Governmental Funds
57
Special Revenue Funds
Special revenue funds are used to account for specific revenues that are legally restricted to expenditures for
particular purposes.
Local Option Gas Tax Fund — This fund is used to account for the government's share of motor fuel tax revenues
that are legally restricted to transportation related expenditures within the government's boundaries.
Recreation Impact Fee Fund — This fund is used to account for recreation impact fees that are restricted for use in
the expansion or construction of recreational facilities.
Stormwater Utility Fee Fund — This fund is used to account for fees collected on a per unit basis that are restricted
for the purposes of managing the City's Stormwater system.
Law Enforcement Forfeiture Fund — This fund is used to account for the receipt of forfeited cash and equipment
associated with police activities and is restricted to police related equipment purchases and community education
initiatives.
Debt Service Fund
Debt service funds are used to account for the accumulation of pledged funds that are legally restricted to pay
debts.
Stormwater Utility Revenue Bonds Debt Service Fund — This fund is used to account for the accumulation of
stormwater utility fees pledged to pay the principal, interest, and fiscal charges on the Stormwater Utility Revenue
Bonds.
Discretionary Sales Surtax Revenue Bonds Debt Service Fund — This fund is used to account for the accumulation
of discretionary sales tax monies pledged to pay the principal, interest, and fiscal charges on the Discretionary
Sales Surtax Revenue bonds.
Capital Projects Funds
Capital projects funds are used to account for the acquisition and construction of major capital facilities other than
those financed by proprietary funds.
General Capital Projects Fund — This fund is used to account for the construction of non-stormwater related
improvements and general capital construction projects. Governmental resources and State grant revenues are
used to finance the improvements in this fund.
Capital Improvements Fund — This fund is used to account for the accumulated resources associated with
infrastructure improvements such as parks and building.
Public Facilities Improvements Fund — This fund accounts for the resources associated with debt for the purpose
of constructing and equipping a new city hall complex and renovation and expansion of the police station.
W.
Permanent Fund
Permanent funds are used to report resources that are legally restricted to the extent that only earnings, not
principal, may be used for purposes that support the reporting government's programs.
Cemetery Permanent Fund — This fund is used to account for principal trust amounts received, sale of cemetery
lots and related interest income. One-half of the cemetery lot sales and the interest portion of the trust can be used
to maintain the community cemetery.
59
City of Sebastian, Florida
Combining Balance Sheet
Nonmajor Governmental Funds
September 30, 2010
ASSETS
Cash and cash equivalents
Investments
Due from other governments
Interest receivable
Total assets
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable
Total liabilities
Fund balances:
Nonspendable
Restricted
Committed
Assigned
Unassigned
Total fund balances
Total liabilities and fund balances
Special Revenue Funds
Local
Law
Option
Recreation
Stormwater
Enforcement
Gas Tax
Impact Fee
Utility
Forfeiture
Total
$ 468,309
$ 855,366
$ (34,744)
$ 24,744
$ 1,313,675
917,252
250,829
612,760
48,769
1,829,610
48,162
-
10,922
-
59,084
130
115
-
3
248
1,433,853
1,106,310
588,938
73,516
3,202,617
41,198
-
97
356
41,651
41,198
-
97
356
41,651
1,392,655
1,106,310
588,841
73,160
3,160,966
1,392,655
1,106,310
588,841
73,160
3,160,966
$ 1,433,853
$ 1,106,310
$ 588,938
$ 73,516
$ 3,202,617
Debt Service Funds
Stormwater
Discretionary
Utility
Sales Surtax
Revenue
Revenue
Bonds 2003
Bonds 2003
Total
$ 182,931
$ 1,554,462
$ 1,737,393
20
192
212
182,951
1,554,654
1,737,605
182,951
1,554,654
1,737,605
182,951
$ 182,951 $
1,554,654 1,737,605
1,554,654 $ 1,737,605
61
City of Sebastian, Florida
Combining Balance Sheet
Nonmajor Governmental Funds
September 30, 2010
(Continued)
Capital Projects Funds
Permanent
Fund
General
Capital
Capital
Projects
Improvements
Total
Cemetery
ASSETS
Cash and cash equivalents
$ 4,167
$ 305,049 $
309,216
$ 165,876
Investments
-
-
-
694,965
Due from other governments
-
-
-
-
Interest receivable
-
-
-
22
Total assets
4,167
305,049
309,216
860,863
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable
4,167
14,185
18,352
1,400
Total liabilities
4,167
14,185
18,352
1,400
Fund balances:
Nonspendable
-
-
-
859,463
Restricted
-
290,864
290,864
-
Committed
-
-
-
-
Assigned
-
-
-
Unassigned
-
-
-
-
Total fund balances
-
290,864
290,864
859,463
Total liabilities and fund balances
$ 4,167
$ 305,049 $
309,216
$ 860,863
62
Total
Other
Governmental
Funds
3,526,160
2,524,575
59,084
482
6,110,301
61,403
61,403
859,463
5,189,435
6,048,898
6,110,301
iX �
City of Sebastian, Florida
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended September 30, 2010
REVENUES:
Taxes:
Motor fuel
Intergovernmental
Impact fees
Charges for services
Fines
Special assessments
Investment earnings
Contributions and donations
Other revenue
Total revenues
EXPENDITURES:
Current:
Public safety
Physical environment
Transportation
Debt Service:
Principal
Interest and fiscal charges
Capital outlay
Total expenditures
Excess (deficiency) of revenues
over (under) expenditures
OTHER FINANCING
SOURCES (USES)
Transfers in
Transfers out
Debt proceeds
Total other financing sources (uses)
Net changes in fund balances
Fund balances - beginning
Fund balances - ending
Special Revenue Funds
Local
Law
Option
Recreation
Stormwater
Enforcement
Gas Tax
Impact Fee
Utility
Forfeiture
Total
$ 595,746 $
-
$ -
$ - $
595,746
18,559
-
-
-
18,559
-
26,000
-
-
26,000
-
-
819,859
-
819,859
-
-
-
19,533
19,533
4,287
12,256
38,806
155
55,504
-
-
-
5,887
5,887
618,592
38,256
858,665
25,575
1,541,088
- 6,015 6,015
- 97 - 97
324,524 - - - 324,524
1,137,190 - - 1,137,190
119,770 - - - 1I9,770
1,581,484
- 97
6,015
1,587,596
(962,892)
38,256 858,568
19,560
(46,508)
-
39
-
(189,032)
(19,338)
(1,057,208)
2,462,000
-
-
2,272,968
(19,299)
(1,057,208)
1,310,076
18,957
(198,640)
82,579
1,087,353
787,481
$ 1,392,655 $
1,106,310 $
588,841 $
- 39
- (1,265,578)
- 2,461000
- 1,196,461
19,560 1,149,953
53,600 2,011,013
73,160 $ 3,160,966
Debt service Funds
Stormwater
Discretionary
Utility
Sales Surtax
Revenue
Revenue
Bonds 2003
Bonds 2003 Total
455
7,038 7,493
455
7,038 7,493
260,000 745,000 1,005,000
178,360 279,463 457,823
438,360 1,024,463 1,462, 823
(437,905) (1,017,425) (1,455,330)
476,221 1,162,586 1,638,807
476,221 1,162,586 1,638,807
38,316 145,161 183,477
144,635 1,409,493 1,554,128
$ 182,951 $ 1,554,654 $ 1,737,605
65
City of Sebastian, Florida
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended September 30, 2010
(Continued)
Capital Projects Funds Permanent
Fund
General
Capital Capital
Projects Improvements Total Cemetery
REVENUES:
Taxes:
Motor fuel
Intergovernmental
Impact fees
Charges for services
Fines
Special assessments
Investment earnings
Contributions and donations
Other revenue
Total revenues
EXPENDITURES:
Current:
Public safety
Physical environment
Transportation
Debt Service:
Principal
Interest and fiscal charges
Capital outlay
Total expenditures
Excess (deficiency) of revenues
over (under) expenditures
OTHER FINANCING
SOURCES (USES)
Transfers in
Transfers out
Debt proceeds
Total other financing sources (uses)
Net changes in fund balances
Fund balances - beginning
Fund balances - ending
52,350
6,972
59,322
181,838
56,572
238,410 -
I8I,838
56,572
238,410 -
(I81,838)
(56,572)
(238,410) 59,322
181,838 22,147
203,985
-
- (76,113)
(76,113)
(29,888)
181,838 (53,966)
127,872
(29,888)
- (110,538)
(110,538)
29,434
- 401,402
401,402
830,029
$ - $ 290,864 $
290,864 $
859,463
Total
Other
Governmental
Funds
$ 595,746
18,559
26,000
872,209
19,533
69,969
5,887
1,607,903
6,015
97
324,524
2,142,190
577,593
238,410
3,288,829
(1,680,926)
1,842,831
(1,371,579)
2,462,000
2,933,252
1,252,326
4,796,572
$ 6,048,898
M
City of Sebastian, Florida
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual
Local Option Gas Tax Special Revenue Fund
For the Year Ended September 30, 2010
REVENUES:
Motor fuel taxes
Intergovernmental
Investment earnings
Total revenues
EXPENDITURES:
Current:
Transportation
Debt service:
Principal
Interest and fiscal charges
Total expenditures
Excess of revenues over expenditures
OTHER FINANCING SOURCES (USES)
Transfers out
Debt proceeds
Total other financing sources (uses)
Net changes in fund balances
Fund balances - beginning
Fund balances - ending
Actual
Variance with
Amounts on
Final Budget -
Final
a Budgetary
Positive
Budget
Basis
(Negative)
$ 676,500
$ 595,746
$ (80,754)
19,523
18,559
(964)
8,983
4,287
(4,696)
705,006
618,592
(86,414)
324,100
1,137,190
119,770
1,581,060
(876,054)
(1,475,461)
2,462,000
986,539
110,485
82,579
193,064
324,524
1,137,190
119,770
1,581,484
(962,892)
(189,032)
2,462,000
2,272,968
1,310,076
82,579
1,392,655
(424)
(424)
(86,838)
1,286,429
1,286,429
1,199,591
1,199,591
M.
City of Sebastian, Florida
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual
Recreation Impact Fee Special Revenue Fund
For the Year Ended September 30, 2010
Actual
Variance with
Amounts on
Final Budget -
Final
a Budgetary
Positive
Budget
Basis
(Negative)
REVENUES:
Impact fees
$ 53,480
$ 26,000 $
(27,480)
Investment earnings
2,767
I2,256
9,489
Total revenues
56,247
38,256
(17,991)
EXPENDITURES:
Current:
Culture and recreation
-
-
-
Total expenditures
-
-
-
Excess of revenues over expenditures
56,247
38,256
(17,991)
OTHER FINANCING (USES)
Transfers in
-
39
39
Transfers out
(190,088)
(19,338)
170,750
Total other financing (uses)
(190,088)
(19,299)
170,789
Net changes in fund balances
(133,841)
18,957
152,798
Fund balances - beginning
1,087,353
1,087,353
-
Fund balances - ending
$ 953,512
$ 1,106,310 $
152,798
••
City of Sebastian, Florida
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual
Stormwater Utility Special Revenue Fund
For the Year Ended September 30, 2010
Actual
Variance with
Amounts on
Final Budget -
Final
a Budgetary
Positive
Budget
Basis
(Negative)
REVENUES:
Charges for services
$ 850,000
$ 819,859 $
(30,141)
Investment earnings
27,344
38,806
11,462
Total revenues
877,344
858,665
(I8,679)
EXPENDITURES:
Current:
Physical environment
100
97
3
Total expenditures
100
97
3
Excess of revenues over expenditures
877,244
858,568
(18,676)
OTHER FINANCING (USES)
Transfers out
(1,019,228)
(1,057,208)
(37,980)
Total other financing (uses)
(1,019,228)
(1,057,208)
(37,980)
Net changes in fund balances
(141,984)
(198,640)
(56,656)
Fund balances - beginning
787,481
787,481
-
Fund balances - ending
$ 645,497
$ 588,841 $
(56,656)
70
City of Sebastian, Florida
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual
Law Enforcement Forfeiture Special Revenue Fund
For the Year Ended September 30, 2010
Actual
Variance with
Amounts on
Final Budget -
Final
a Budgetary
Positive
Budget
Basis
(Negative)
REVENUES:
Fines
$ 8,000
$ 19,533
$ 11,533
Investment earnings
200
155
(45)
Contributions
2,000
5,887
3,887
Otherrevenues
-
-
-
Total revenues
10,200
25,575
15,375
EXPENDITURES:
Current:
Public safety
3,179
6,015
(2,836)
Total expenditures
3,179
6,015
(2,836)
Excess of revenues over expenditures
7,021
19,560
12,539
Fund balances - beginning
53,600
53,600
-
Fund balances - ending
$ 60,621
$ 73,160
$ 12,539
71
City of Sebastian, Florida
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual
Stormwater Utility Revenue Bonds 2003 Debt Service Fund
For the Year Ended September 30, 2010
REVENUES:
Investment earnings
Total revenues
EXPENDITURES:
Debt service:
Principal
Interest and fiscal charges
Total expenditures
Deficiency of revenues under expenditures
OTHER FINANCING SOURCES
Transfers in
Total other financing sources
Net changes in fund balances
Fund balances - beginning
Fund balances - ending
Final
Budget
$ 120 $
120
260,000
178,360
438,360
(438,240)
438,240
438,240
144,635
$ 144,635 $
Actual
Amounts on
a Budgetary
Basis
455 $
455
260,000
178,360
438,360
(437,905)
476,221
476,221
38,316
144,635
182,951 $
Variance with
Final Budget -
Positive
(Negative)
335
335
335
37,981
37,981
38,316
38,316
72
City of Sebastian, Florida
Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual
Discretionary Sales Surtax Revenue Bonds 2003 Debt Service Fund
For the Year Ended September 30, 2010
Actual
Amounts on
Final
a Budgetary
Budget
Basis
REVENUES:
Investment earnings
$ 1,000
$ 7,038
Total revenues
1,000
7,038
EXPENDITURES:
Debt service:
Principal
745,000
745,000
Interest and fiscal charges
291,569
279,463
Total expenditures
1,036,569
1,024,463
Deficiency of revenues under expenditures
(1,035,569)
(1,017,425)
OTHER FINANCING SOURCES
Transfers in
1,035,869
1,162,586
Total other financing sources
11035,869
1,162,586
Net changes in fund balances
300
145,161
Fund balances - beginning
1,409,493
1,409,493
Fund balances - ending
$ 1,409,793
$ 1,554,654
Variance with
Final Budget -
Positive
(Negative)
$ 6,038
6,038
12,106
12,106
18,144
126,717
126,717
144,861
$ 144,861
City of Sebastian, Florida
Statement of Changes in Assets and Liabilities
Agency Fund
For the Year Ended September 30, 2010
ASSETS
Cash and cash equivalents
Investments, at fair value
Total assets
LIABILITIES
Performance deposits held in escrow
Total liabilities
Balance Balance
October 1, September 30,
2009 Additions Deletions 2010
$ 12,760 $ 5,000 $ 5,830 $ 11,930
220,000 - - 220,000
$ 232,760 $ 5,000 $ 5,830 $ 23I,930
$ 232,760 $ 5,000 $ 5,830 $ 231,930
$ 232,760 $ 5,000 $ 5,830 $ 231,930
74
City of Sebastian, Florida
Capital Assets Used in the Operation of Governmental Funds
Comparative Schedule By Source
September 30, 2010
Governmental Funds capital assets:
FY 2009 FY 2010
Land
$ 5,699,045 $
8,007,437
Buildings and structures
11,284,488
12,061,711
Improvement other than buildings
5,704,686
5,738,546
Machinery and equipment
7,784,213
7,742,063
Infrastructure
25,125,625
30,891,580
Capital projects
3,958,971
951,144
Total capital assets
$ 59,557,028 $
65,392,481
Investment in Governmental Funds capital assets by sources:
Federal grants
$ 3,062,044 $
6,140,108
State grants
907,755
907,755
County grants
713,359
713,359
General fund
11,552,446
11,296,100
Law enforcement trust fund
61,068
49,883
Recreational impact fee
1,179,319
1,203,687
Stormwater utility fee
387,153
4,880,968
Riverfront Redevelopment
1,097,069
1,675,466
Cemetery trust fund
237,479
236,479
Donations
3,159,873
3,165,873
Sales taxes
11,911,948
12,844,066
Motor fuel taxes
5,591,414
5,590,464
Revenue bond debt
15,737,130
15,737,130
Capital projects
3,958,971
951,143
Total investment in capital assets
$ 59,557,028 $
65,392,481
75
City of Sebastian, Florida
Capital Assets Used in the Operation of Governmental Funds
Schedule by Function and Activity
September 30, 2010
Improvements
Machinery
Other than
and
Function and Activity
Land
Buildings
Buildings
Equipment
Infrastructure
Totals
General government:
Legislative
$ -
$ -
$ 1,100
$ 7,131
$ -
$ 8,231
City manager
-
-
-
1,612
-
1,612
City clerk
-
-
-
134,766
-
134,766
Finance
-
-
-
55,306
-
55,306
MIS
-
5,841
53,131
353,756
-
412,728
Facilities maintenance
-
133,430
15,665
68,250
-
217,345
Growth management
-
85,555
-
38,268
-
123,823
Non -departmental
3,634,769
6,184,990
126,636
204,374
52,700
10,203,469
Subtotal
3,634,769
6,409,816
196,532
863,463
52,700
11,157,280
Public safety:
Special operations
-
-
-
176,393
-
176,393
Administration
9,560
3,347,152
89,320
282,962
-
3,728,994
School resource
-
-
-
69,943
-
69,943
Road patrol
-
-
-
2,313,919
-
2,313,919
Community policing
-
-
-
42,139
-
42,139
Code enforcement
-
-
-
32,600
-
32,600
Professional Stnd.
-
-
-
19,025
-
19,025
Investigations
-
-
1,700
240,353
-
242,053
Support services
-
-
-
59,026
-
59,026
Communications
-
-
16,404
209,808
-
226,212
Building department
-
-
-
51,838
-
51,838
Subtotal
9,560
3,347,152
107,424
3,498,006
-
6,962,142
Transportation:
Engineering
-
-
-
1,088
-
1,088
Central garage
-
130,489
82,419
143,456
674
357,038
Roads and drainage
47,125
162,044
970,637
1,100,000
13,112,037
15,391,843
Subtotal
47,125
292,533
1,053,056
1,244,544
13,112,711
15,749,969
Economic Environment:
Non -departmental
2,308,392
784,000
-
-
-
3,092,392
Subtotal
2,308,392
784,000
-
-
-
3,092,392
Physical Environment:
Stormwater
-
-
1,850
1,478,551
16,106,109
17,586,510
Cemetery
272,190
82,019
78,354
56,809
22,717
512,089
Subtotal
272,190
82,019
80,204
1,535,360
16,128,826
18,098,599
Culture/Recreation:
Parks and recreation
1,735,401
1,146,191
4,301,330
600,690
1,597,343
9,380,955
Subtotal
1,735,401
1,146,191
4,301,330
600,690
1,597,343
9,380,955
Total
$ 8,007,437
$ 12,061,711
$ 5,738,546
$ 7,742,063
$ 30,891,580
64,441,337
Construction in progress
951,144
Total
$ 65,392,481
76
Function and Activity
General government:
Legislative
City manager
City clerk
City attorney
Finance
MIS
Facilities maintenance
Growth management
Non -departmental
Subtotal
Public Safety:
Special operations
Administration
School resource
Road patrol
Community policing
Code enforcement
Professional Stnd.
Investigations
Support services
Communications
Building department
Subtotal
Transportation:
Engineering
Central garage
Roads and drainage
Subtotal
Economic Environment:
Non -departmental
Subtotal
Physical Environment:
Stormwater
Cemetery
Subtotal
Culture & Recreation:
Parks and recreation
Subtotal
Total
Construction in progress
Total
City of Sebastian, :Florida
Capital Assets Used in the Operation of Governmental Funds
Schedule of Changes By Function and Activity
September 30, 2010
Governmental
Governmental
Funds
Funds
Capital Assets
Transfers
Transfers
Capital Assets
October 1, 2009
Additions
Deletions
In
Out
September 30, 2010
$ 3,986
$ 784
$ -
$ 3,461
$ -
$ 8,231
2,826
-
1,214
-
-
1,612
136,974
-
2,208
-
-
134,766
599
-
-
-
599
-
55,306
-
-
-
-
55,306
125,721
17,217
7,906
280,558
2,862
412,728
2I8,295
-
-
-
950
217,345
135,739
-
11,916
-
-
123,823
10,754,554
-
-
-
551,085
10,203,469
11,434,000
18,001
23,244
284,019
555,496
11,157,280
176,393
-
-
-
-
176,393
3,728,994
-
-
3,728,994
71,469
-
1,526
69,943
2,392,531
153,527
232,139
-
-
2,311919
95,917
-
53,778
-
-
42,139
34,302
-
-
-
1,702
32,600
19,025
-
-
-
19,025
182,360
63,986
-
-
4,293
242,053
59,877
-
-
-
851
59,026
228,059
-
-
-
1,847
226,212
51,838
-
-
-
-
51,838
7,040,765
217,513
285,917
-
10,219
6,962,142
2,216
-
-
-
1,128
1,088
346,403
12,000
-
-
1,365
357,038
15,157,776
68,143
15,717
160,000
811
15,369,391
15,506,395
80,143
15,717
160,000
3,304
15,727,517
- 3,092,392 - - 3,092,392
- 3,092,392 - - - 3,092,392
11,872,323
5.714,187
-
-
512,089
-
-
- -
12,384,412
5,714,187
-
- -
9,232,485
74,617
28,695
125,000 -
9,232,485
74,617
28,695
125,000 -
55,598,057
9,196,853
353,573
569,019 569,019
3,958,971
676,247
3,684,074
- -
$ 59,557,028
$ 9,873,100
$ 4,037,647
$ 569,019 $ 569,019 $
17,586,510
512,089
18,098,599
9,403,407
9,403,407
64,441,337
951,144
65,392,481
77
NA---V �
HOME OF PELICAN ISLAND
THIS PAGE INTENTIONALLY LEFT BLANK
Statistical Section
This part of the City of Sebastian, Florida's comprehensive annual financial report
presents detailed information as a context for understanding what the information in the
financial statements, note disclosures, and required supplementary information says
about the city's overall financial health.
Contents Page(s)
Financial Trends 80-91
These schedules contain trend information to help the reader understand how
the city's financial performance and well-being have changed over time.
Revenue Capacity 92-97
These schedules contain information to help the reader assess the city's most
significant local revenue source, the property tax, and the municipal sales tax.
Debt Capacity 98-103
These schedules present information to help the reader assess the affordability
of the city's current levels of outstanding debt and the city's ability to issue
additional debt in the future.
Economic and Demographic Information 104-106
These schedules offer economic and demographic indicators to help the reader
understand the environment within which the city's financial activities take
place.
Operating Information 107-109
These schedules contain service and infrastructure data to help the reader
understand how the information in the city's financial report relates to the
services the city provides and the activities it performs.
Sources: Unless otherwise noted, the information in these schedules is derived from the
comprehensive annual financial reports for the relevant year. The city implemented
GASB Statement 34 in 2001; schedules presenting government -wide information include
information beginning in that year.
79
City of Sebastian, Florida
Net Assets By Component
Last Ten Fiscal Years
(accrual basis of accounting)
2010 2009 2008
Governmental Activities
Invested in Capital Assets, Net of Related Debt
$
28,938,587
$
26,744,896
$
24,133,550
Restricted
8,757,043
8,197,018
9,215,801
Unrestricted
3,889,011
4,502,440
5,035,184
Total Governmental Activities Net Assets
$
41,584,641
$
39,444,354
$
38,384,535
Business -Type Activities
Invested in Capital Assets, Net of Related Debt
$
11,389,704
$
I0,725,676
$
9,111,251
Restricted
-
98,320
570,149
Unrestricted (deficit)
(342,340)
86,517
753,076
Total Business -Type Activities Net Assets
$
11,047,364
$
10,9I0,513
$
10,434,476
Primary government
Invested in Capital Assets, Net of Related Debt
$
40,328,291
$
37,470,572
$
33,244,801
Restricted
8,757,043
8,295,338
9,785,950
Unrestricted
3,546,671
4,588,957
5,788,260
Total Primary Government Net Assets
$
52,632,005
$
50,354,867
$
48,819,011
(`) The large increases in unrestricted net assets from 2003 to 2004 and from 2004 to
2005 are mainly due to increase
in State revenue sharing. sales and use taxes, and tax revenues
(2) The large increase in unrestricted net assets from 2005 to 2006 is mainly
due to increase in tax revenues,
franchise
fees, and interest earnings.
80
2007
2006
2005
2004
2003
2002
2001
$ 21,469,456
$ 17,579,683
$ 17,103,399
$ 16,412,401
$ 16,339,222
$ 14,242,832
$ 12,778,007
9,419,129
5,068,583
5,395,879
4,059,674
3,235,266
3,289,670
2,270,654
5,249,998
11,293,877 #
9,081,345
7,171,123
# 5,461,224
5,865,388
5,417,630
$ 36,138,583
$ 33,942,143
$ 31,580,623
$ 27,643,198
$ 25,035,712
$ 23,397,890
$ 20,466,291
$ 8,895,501
$ 8,798,612
$ 7,459,945
$ 4,264,961
$ 1,545,867
$ 363,827
$ 150,722
570,890
560,581
574,105
506,006
505,435
458,014
640,973
1,303,886
1,896,539
738,519
1,712,657
1,471,457
1,120,224
985,863
$ 10,770,277
$ 11,255,732
$ 8,772,569
$ 6,483,624
$ 3,522,759
$ 1,942,065
$ 1,777,558
$ 30,364,957
$ 26,378,295
$ 24,563,344
$ 20,677,362
$ 17,885,089
$ 14,606,659
$ 12,928,729
9,990,019
5,629,164
5,969,984
4,565,680
3,740,701
3,747,684
2,911,627
6,553,884
13,190,416
9,819,864
8,883,780
6,932,681
6,985,612
6,403,493
$ 46,908,860
$ 45,197,875
$ 40,353,192
$ 34,126,822
$ 28,558,471
$ 25,339,955
$ 22,243,849
81
City of Sebastian, Florida
Changes in Net Assets
Last Ten Fiscal Years
(accrual basis of accounting)
Program Revenues
Governmental Activities:
Charges for Services:
General Government
Public Safety
Physical Environment
Economic Environment
Cultural/Recreation
Operating Grants and Contributions
Capital Grants and Contributions
Total Governmental Activities Program Revenues
Business -Type Activities:
Charges for Services:
Golf Course
Airport
Building
Operating Grants and Contributions
Capital Grants and Contributions
Total Business -Type Activities Program Revenues
Total Primary Government Program Revenues
Expenses
Governmental Activities:
General Government
Public Safety
Physical Environment
Transportation
Economic Environment
Cultural/Recreation
Interest and Fiscal Charges
Total Governmental Activities Expenses
Business -Type Activities:
Golf Course
Airport
Building
Total Business -Type Activities Expenses
Total Primary Government Expenses
2010 2009 2008
$ 203,915
$ 220,073
$ 353,836
118,368
95,606
85,009
881,338
908,829
903,285
62,046
66,540
83,378
210,050
228,002
786,016
3,178,618
1,865,174
835,607
4,654,335
3,384,224
3,047,131
1,335,647
1,406,956
1,438,233
468,698
438,485
523,989
356,264
358,947
347,189
904,853
1,356,914
494,098
3,065,462
3,561,302
2,803,509
$ 7,719,797
$ 6,945,526
$ 5,850,640
$ 3,309,381
$ 3,169,851
$ 3,375,178
5,720,933
5,420,585
5,226,512
1,947,605
1,347,771
1,805,755
1,863,551
3,437,724
2,111,360
135,885
167,470
113,101
1,240,3 83
1,073,249
1,420,734
566,410
730,100
634,891
14,784,148
15,346,750
14,687,531
1,388,158
1,477,299
1,488,472
1,067,525
1,079, 869
1,099,653
496,800
533,641
605,422
2,952,483
3,090,809
3,193,547
$ 17,736,631 $ 18,437,559 $ 17,881,078
(1) The building operation was reclassified from being part of the general fund operation to an enterprise fund
operation at the beginning of fiscal year 2006.
82
2007 2006 2005 2004 2003 2002 2001
$ 422,897
$
533,482
$
370,609
$
376,327
$
247,774
$
172,135
$
183,502
92,853
140,545
1,356,385
1,660,032
824,821
625,924
554,350
891,021
887,819
828,907
850,887
799,637
785,683
-
-
-
-
-
-
24,869
18,753
85,945
72,472
56,199
48,590
46,736
73,013
35,050
192,676
407,898
2,802,511
1,144,528
920,829
958,229
902,001
1,014,481
1,301,438
1,781,954
1,353,959
640,894
872,490
581,941
2,699,873
3,343,654
7,196,565
5,434,323
3,480,691
3,512,343
2,275,597
1,652,288
1,580,407
1,381,817
1,648,308
1,377,245
1,365,027
1,088,104
344,813
375,768
434,818
201,890
168,451
179,373
193,649
408,875
1,220,823
-
-
-
-
(1)
-
6,998
13,582
67,576
-
51,087
123,673
500,428
1,056,562
2,289,986
2,451,212
1,149,437
214,175
299,334
2,906,404
4,240,558
4,120,203
4,368,986
2,695,133
1,809,662
1,704,760
$ 5,606,277
$
7,584,212
$
11,316,768
$
9,803,309
$
6,175,824
$
5,322,005
$
3,980,357
$ 3,083,609
$
3,129,723
$
3,262,276
$
2,414,865
$
1,620,616
$
2,010,288
$
1,676,383
5,377,107
4,191,295
4,816,614
4,502,109
3,391,831
2,945,701
2,526,514
1,695,066
2,193,589
1,283,889
1,279,257
1,920,200
508,616
452,116
2,276,497
2,173,071
4,034,900
3,288,532
2,401,037
2,258,181
1,630,098
605,510
98,661
32,128
86,041
166,024
223,207
241,692
1,237,398
1,208,288
1,260,395
823,974
747,910
881,260
768,802
667,950
706,303
740,372
722,007
312,367
168,749
160,954
14,943,137
13,700,930
15,430,574
13,116,785
10,559,985
8,996,002
7,456,559
1,533,900
1,558,338
1,464,532
1,527,051
1,363,359
1,393,551
1,341,001
1,046,994
801,967
519,235
350,949
315,941
283,726
313,877
905,452
936,793
-
-
-
-
(1)
3,486,346
3,297,098
1,983,767
1,878,000
1,679,300
1,677,277
1,654,878
$ 18,429,483
$
16,998,028
$
17,414,341
$
14,994,785
$
12,239,285
$
10,673,279
$
9,111,437
83
City of Sebastian, Florida
Changes in Net Assets (continued)
Last Ten Fiscal Years
(accrual basis of accounting)
Net (Expense)/Revenue
Governmental Activities
Business -Type Activities
Total Primary Government Net Expense
General Revenues and Other Changes in Net Assets
Governmental Activities:
Property Taxes, Levied for General Purposes
Sales and Use Taxes
Franchise Fees
State Shared Revenues
Interest Earnings
Miscellaneous
Transfers
Total Governmental Activities
Business -Type Activities:
Interest Earnings
Miscellaneous
Transfers
Total Business -Type Activities
Total Primary Government
Change in Net Assets
Governmental Activities
Business -Type Activities
Total Primary Government Change in Net Assets
2010 2009 2008
$ (10,129,813) $ (11,962,526) $ (11,640,400)
112,979 470,493 (390,038)
$ (10,016,834) $ (11,492,033) $ (12,030,438)
$ 4,164,128 $ 4,801,924 $ 5,149,047
4,765,200
4,670,106
4,753,718
1,228,692
1,327,253
1,199,762
1,825,215
1,821,347
1,989,606
144,432
261,203
634,919
149,453
140,512
159,300
(7,020)
-
-
12,270,100 13,022,345 13,886,352
15,658 5,544 54,237
1,194 - -
7,020 - -
23,872 5,544 54,237
$ 12,293,972 $ 13,027,889 $ 13,940,589
$ 2,140,287 $ 1,059,819 $ 2,245,952
136,851 476,037 (335,801)
$ 2,277,138 $ 1,535,856 $ 1,910,151
(2) The large increase in transfers from 2005 to 2006 is mainly due to the one time transfer of
building reserve to building fund due to the reclassification of fund type for the building operation.
84
2007
2006
2005
2004
2003
2002
2001
$(12,243,264)
$(10,357,276)
$ (8,234,009)
$ (7,682,462)
$ (7,079,294)
$ (5,483,659)
$ (5,180,962)
(579,942)
943,460
2,136,436
2,490,986
1,015,833
132,385
49,882
$(12,823,206)
$ (9,413,816)
$ (6,097,573)
$ (5,191,476)
$ (6,063,461)
$ (5,351,274)
$ (5,131,080)
$ 5,089,841
$
4,645,050
$
4,017,555
$
3,420,971
$
2,944,456
$
2,615,939
$
2,557,333
4,776,691
4,907,906
4,718,691
4,035,545
3,705,922
2,844,825
3,013,293
1,106,698
1,253,749
886,390
770,600
756,194
766,901
753,024
2,083,523
2,242,292
2,138,020
1,721,956
1,523,524
2,068,753
1,336,046
1,147,931
827,224
398,518
398,158
241,358
118,840
236,307
192,300
256,780
118,760
388,562
79,662
-
-
42,720
(1,414,205)
(106,500)
(445,844)
(534,000)
-
-
14,439,704
12,718,796
12,171,434
10,289,948
8,717,116
8,415,258
7,896,003
137,207
125,498
45,709
23,774
21,789
32,122
99,521
-
-
300
1 261
9,072
-
-
(42,720)
1,414,205
12)
106,500
445,844
534,000
-
-
94,487
1,539,703
152,509
469,879
564,861
32,122
99,521
$ 14,534,191
$
14,258,499
$
12,323,943
$
10,759,827
$
9,281,977
$
8,447,380
$
7,995,524
$ 2,196,440
$
2,361,520
$
3,937,425
$
2,607,486
$
1,637,822
$
2,931,599
$
2,715,041
(485,455)
2,483,163
2,288,945
2,960,865
1,580,694
164,507
149,403
$ 1,710,985
$
4,844,683
$
6,226,370
$
5,568,351
$
3,218,516
$
3,096,106
$
2,864,444
85
General Fund
Nonspendable
Committed
Assigned
Unassigned
Total General Fund
All Other Governmental Funds
Nonspendable
Restricted
Total All Other Governmental Funds
Total Governmental Funds
City of Sebastian, Florida
Fund Balances, Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
2010
2009
2008
2007
2006
$ 352,248
$ 357,696
$ 381,528
$ 368,609
$ 106,192
3,063,585
3,083,463
3,502,560
3,742,617
4,844,674
31,656
1,983
33,453
19,055
9,856
2,164,910
2,324,972
2,390,641
2,260,507
1,518,350
5,612,399
5,768,114
6,308,182
6,390,788
6,479,072
859,463
7,897,580
8,757,043
$14,369,442
830,029 771,927 694,506 656,160
8,557,389 "' 12,446,260 12,926,545 14,783,299
9,387,418 13,218,187 13,621,051 15,439,459
$15,155,532 $19,526,369 $20,011,839 $21,918,531
(1) The significant reduction in restricted fund balance reported in All Other Governmental Funds from 2008 to 2009,
is a result of the significant completion of the Indian River Drive/Main Street and Pedestrian Bridge Projects,
along with the significant construction completed on the Collier Canal Retrofit Project.
(2) The large increase in restricted fund balance for All Other Governmental Funds 2002 to 2003 is due to the issuance
of City's Infrastructure Sales Surtax Revenue Bonds, Series 2003.
(3) The increase in committed fund balance and the negative unassigned fund balance in the General Fund is a result
of Resolution R-02-42, which established a line of credit reserve in the amount of $1M within the general fund to fund
improvements at the Sebastian Municipal Airport, in anticpation of grant funding.
86
2005
2004
2003
2002
$ 160,964
$ 59,921
$ 141,667
$ 28,147
5,546,959
(3) 5,411,621
(3) 3,924,363
(3) 2,743,933
3,761
5,140
7,706
8,221
391,783
(3) (361,790)
(3) (191,886)
�3) 1,142,446
6,103,467
5,114,892
3,881,850
3,922,747
578,367
542,999
463,402
445,939
13,392,801
13,815,771
13,339,097
(2) 5,250,078
13,971,168
14,358,770
13,802,499
5,696,017
$ 20,074,635
$19,473,662
$ 17,684,349
$ 9,618,764
2001
$ 27,224
2,362,161
8,067
1,129,887
3,527,339
406,986
4,056,658
4,463,644
$ 7,990,983
87
City of Sebastian, Florida
Changes in Fund Balances, Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
2010
2009
2008
Revenues
Property and Other Local Taxes
$ 9,525,074
$ 10,065,806
$ 10,504,155
Franchise Fees
1,228,692
1,327,253
1,199,762
Charges for Services
1,154,739
1,186,161
1,209,617
Licenses and Permits
33,182
29,151
163,471
Fines
90,948
88,938
65,246
Intergovernmental
4,572,550
3,270,854
2,674,761
Impact Fees
26,000
13,975
32,825
Special Assessments
-
3,849
-
Investment Earnings
228,216
250,914
647,312
Miscellaneous
169,039
176,430
461,553
Total Revenues
17,028,440
16,413,331
16,958,702
Expenditures
Current:
General Government
2,699,289
2,976,896
3,087,789
Public Safety
4,938,147
4,926,714
4,677,618
Physical Environment
1,210,823
1,448,067
1,368,593
Transportation
1,405,310
1,696,254
1,545,045
Economic Environment
129,352
167,470
113,101
Cultural and Recreation
977,780
1,148,408
1,079,379
Debt service:
Principal Retirement
2,142,190
1,218,995
1,326,182
Interest and Fiscal Charges
577,593
706,093
611,554
Capital Outlay
6,189,026
6,495,271
3,634,910
Total Expenditures
20,269,510
20,784,168
17,444,171
Excess of Revenues Over (Under) Expenditures
(3,241,070)
(4,370,837)
(485,469)
Other Financing Sources (Uses)
Debt Proceeds
2,462,000
Transfers In
4,486,626
5,196,376
5,679,896
Transfers Out
(4,493,646)
(5,196,376)
(5,679,896)
Total Other Financing Sources (Uses)
2,454,980
-
Net Change in Fund Balances
$ (786,090)
$ (4,370,837)
$ (485,469)
Debt Service as a Percentage of Noncapital Expenditures
19.3% 13.5% 14.0%
88
2007 2006
$ 10,554,617
$ 10,269,451
1,106,698
1,253,749
1,271,102
517,605
186,875
244,370
71,314
77,776
2,463,628
2,852,293
56,875
337,675
-
819,286
1,062,043
827,224
244,629
294,695
17,017,781 17,494,124
2005 2004 2003 2002 2001
$ 9,483,664 $ 8,179,344 $ 7,325,932 $ 6,228,107 $ 6,223,280
886,390
770,600
756,194
766,901
753,024
936,530
962,677
921,119
1,123,670
300,046
1,587,675
1,867,920
878,097
578,695
487,618
95,699
118,918
119,752
127,027
148,676
5,561,695
3,115,520
1,785,237
2,841,315
1,968,416
385,775
557,700
395,850
255,775
-
11,023
28,424
22,560
31,756
28,528
398,518
398,158
241,358
206,567
417,707
144,057
378,268
91,078
126,823
196,311
19,491,026
16,377,529
12,537,177
12,286,636
10,523,606
2,999,652
2,494,863
2,974,736
2,231,532
1,977,033
2,230,870
1,647,858
4,700,447
3,813,908
4,349,639
3,950,228
3,427,711
2,588,526
2,482,393
1,301,719
1,850,642
910,794
1,125,727
1,247,452
508,616
452,116
1,733,697
1,672,983
3,616,076
2,863,397
1,610,761
1,427,992
1,084,401
80,279
98,661
32,128
86,041
166,024
327,911
273,927
975,087
926,846
995,406
747,131
629,835
732,729
612,038
1,284,418
1,248,378
1,218,023
985,974
361,024
344,553
222,954
643,305
678,682
711,736
887,564
158,043
174,864
152,093
5,242,590
1,451,060
3,975,015
9,021,558
3,859,709
2,322,794
3,402,365
18,961,194
14,236,023
18,783,553
21,899,152
13,437,592
10,658,855
10,330,145
(1,943,413)
3,258,101
707,473
(5,521,623)
(900,415)
1,627,781
193,461
-
-
7,756,780
9,500,000
-
900,000
5,158,296
3,785,981
3,745,265
2,745,754
2,992,908
2,009,173
2,130,744
(5,115,576)
(5,200,186)
(3,851,765)
(3,191,598)
(3,526,908)
(2,009,173)
(2,130,744)
42,720
(1,414,205)
(106,500)
7,310,936
8,966,000
-
900,000
$ (1,900,693)
$ 1,843,896
$ 600,973
$ 1,789,313
$ 8,065,585 $
1,627,781 $
1,093,461
14.1%
15.1%
13.0%
14.5%
5.4%
6.2%
5.4%
89
City of Sebastian, Florida
Program Revenues by Function/Program
Last Ten Fiscal Years
(accrual basis of accounting)
2010 2009 2008
Function/Program
Governmental Activities:
General Government
$ 209,144 $
226,003 $
377,305
Public Safety
304,630
299,119
515,997
Physical Environment
881,338
1,408,829
1,256,277
Transportation
614,305
612,335
619,949
Economic Environment
2,556,872
6,000
-
Cultural/Recreation
88,046
831,938
277,603
Total Governmental Activities
4,654,335
3,384,224
3,047,131
Business -type activities:
Golf Course
1,335,647
1,406,955
1,438,233
Airport
1,373,551
1,795,399
1,018,087
Building(')
356,264
358,948
347,189
Total Business -Type Activities
3,065,462
3,561,302
2,803,509
Total Primary Government
$ 7,719,797 $
6,945,526 $
5,850,640
(1) The building operation was reclassified from being part of the general fund operation to an
enterprise fund beginning of fiscal year 2006.
(2) The significant increase in business -type activities for the airport from 2008 to 2009 is
mainly due to capital grant funding from the Florida Department of Transportation and
the Federal Aviation Administration
90
2007 2006 2005 2004 2003 2002 2001
$ 450,267
$ 579,591
$ 587,527
$ 392,471
$ 1,095,902
$ 172,135
$ 226,786
249,756
306,702
1,537,557
1,850,710
929,952
785,373
633,230
891,021
890,092
898,821
914,318
1,136,507
785,683
779,837
721,103
900,365
3,392,883
1,670,534
1,580,076
3,038,913
2,285,809
-
30,059
-
-
-
24,869
18,753
387,726
636,845
779,777
606,290
663,459
566,959
168,335
2,699,873
3,343,654
7,196,565
5,434,323
5,405,896
5,373,932
4,1 12,750
1,652,288
1,587,405
1,395,399
1,715,884
1,377,245
1,365,517
1,088,104
845,241
1,432,330
2,724,804
2,653,102
1,317,888
444,145
616,656
408,875
1,220,823
-
-
-
-
-
2,906,404
4,240,558
4,120,203
4,368,986
2,695,133
1,809,662
1,704,760
$ 5,606,277
$ 7,584,212
$ 11,316,768
$ 9,803,309
$ 8,101,029
$ 7,183,594
$ 5,817,510
M
City of Sebastian, Florida
Tax Revenues by Source, Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
Fiscal Year
Property Taxes
Public Utility
Sales Tax
Motor Fuel
Total
2010
$ 4,164,128
$ 2,437,050
$ 2,328,150 $
595,746 $
9,525,074
2009
(5) 4,801,924
2,341,458
2,328,648
593,776
10,065,806
2008
(4) 5,149,047
2,250,781
2,502,937
601,390
10,504,155
2007
(3) 5,089,841
2,216,381
2,560,310
688,085
10,554,617
2006
(2) 4,645,050
2,183,164
2,724,742
716,495
10,269,451
2005
4,017,555
2,005,124
2,713,567
747,418
9,483,664
2004
3,420,971
1,854,632
2,180,913
722,828
8,179,344
2003
2,944,456
1,780,717
1,925,205
675,554
7,325,932
2002
(1) 2,717,564
983,236
1,861,589
665,718
6,228,107
2001
2,608,989
1,151,685
1,861,608
600,998
6,223,280
(1) Fiscal Year 2002 property tax revenue reflects a change in the property tax millage rate from 5.0000 to 4.5904.
(2) Fiscal Year 2006 property tax revenue reflects a change in the property tax millage rate from 4.5904 to 3.9325.
(3) Fiscal Year 2007 property tax revenue reflects a change in the property tax millage rate from 3.9325 to 3.0519.
(4) Fiscal Year 2008 property tax revenue reflects a change in the property tax millage rate from 3.0519 to 2.9917.
(5) Fiscal Year 2009 property tax revenue reflects a change in the property tax millage rate from 2.9917 to 3.3456.
Millage Rate represents the dollar of tax per one thousand dollars of taxable valuation.
92
City of Sebastian, Florida
Property Tax Rates
Direct and Overlapping Governments
Last Ten Fiscal Years
City of Sebastian
Indian River County School Board
Debt
Total
Total
Debt
Total
Fiscal
Operating Service
City
County(`)
Operating
Service
School
Year
Millage Millage
Millage
Millage
Millage
Millage
Millage
Other(2)
2010
3.3456
3.3456
6.26930
7.29600
0.30000
7.59600
1.33570
2009
3.3456
3.3456
6.28610
6.76000
0.28000
7.04000
1.11204
2008
2.9917 -
2.9917
5.14850
7.26800
0.27000
7.53800
1.38160
2007
3.0519 -
3.0519
5.36610
7.16300
0.28000
7.44300
1.47940
2006
3.9325 -
3.9325
5.69040
7.88000
0.36000
8.24000
1.60850
2005
4.5904 -
4.5904
7.35050
8.01900
0.48000
8.49900
1.43029
2004
4.5904 -
4.5904
7.93960
8.17900
0.53100
8.71000
1.69278
2003
4.5904 -
4.5904
8.03020
8.10200
0.63000
8.73200
1.43875
2002
4.5904 -
4.5904
8.08410
8.40200
0.68000
9.08200
1.14845
2001
5.0000 -
5.0000
8.24860
8.67700
0.88000
9.55700
1.62899
c'> Millage includes General Fund, M.S.T.U.s, Emergency Services District and Land Bonds.
(2) All Special Taxing Districts.
Source: Indian River County Property Appraiser's Office
93
City of Sebastian, Florida
Assessed Valuation and Estimated Taxable Property Values
Last Ten Fiscal Years
Real Property Personal Property
Fiscal
Assessed
Estimated
Assessed
Estimated
Year
Value
Actual Value
Value
Actual Value
2010
1,650,311,449
2,062,889,311
56,920,223
56,920,223
2009
1,933,934,630
2,417,418,288
62,476,508
62,476,508
2008
2,054,408,055
2,568,010,069
64,899,942
64,899,942
2007
2,124,615,672
2,655,769,590
55,913,696
55,913,696
2006
1,526,923,406
1,908,654,258
51,827,624
51,827,624
2005
1,157,275,164
1,446,593,955
51,330,277
51,330,277
2004
946,293,950
1,182,867,438
48,613,628
48,613,628
2003
829,224,615
1,036,530,769
45,355,170
45,355,170
2002
754,577,150
943,221,438
45,195,579
45,195,579
2001
656,619,860
820,774,825
42,216,162
41,533,985
Source: Indian River County Property Appraiser
Fiscal Year information is provided from previous Tax Year.
94
Total
Total
Exemptions
Taxable
Estimated
Property
Value
Actual Value
558,090,532
1,707,231,672
2,119,809,534
676, 808,522
1,996,411,138
2,479, 894,796
334,302,515
2,119,307,997
2,632,910,011
322,318,753
2,180,529,368
2,711,683,286
271,466,364
1,578,751,030
1,960,481,882
228,262,825
1,208,605,441
1,497,924,232
217,554,663
994,907,578
1,231,481, 066
205,977,066
874,579,785
1,081,885,939
198,445,669
799,772,729
988,417,017
190,327,263
698,836,022
862,308,810
95
City of Sebastian, Florida
Principal Taxpayers
Fiscal Year 2010 and 2001
Taxpayer & (Business Type)
Florida Power & Light (Utility/Electric)
Wal-Mart Stores Inc. (Retail)
IPF / Sebastian LLC (Retail)
Bellsouth Communications (Utility/Telephone)
BW US 1 Inc. (Commerical)
Park Place Community LLC (Rental/Retail)
KB Homes Treasure Coast LLC (Construction)
512 Commerce Center LLC (Commercial)
Chance Holdings LLC (Development)
Pelican Isles Limited Partnership (Rental)
James T Turner (MHP/Rentals)
Ruth Guest House, Inc. (Rental/Retail)
Oyster Point Resort Condo (Time Share/Rental)
Sebastian Inlet Marina & Trading Co., Inc.
(Restaurant/Hotel)
Charter Communications (Utility/Cable)
Sebastian Resort Property Inc. (Rental)
Sandy Pines Ltd. (Rental)
Total Assessed Valuation
2010
2001
Real
Percentage
Real
Percentage
Property
of Total
Property
of Total
Assessed
Assessed
Assessed
Assessed
Valuation
Rank
Valuation
Valuation
Rank
Valuation
$ 15,809,386
1
13.33%
$ 10,348,995
2
1.29%
13,404,610
2
11.30%
10,784,171
1
1.35%
9,743,746
3
8.22%
-
-
7,153,062
4
6.03%
8,784,704
3
1.10%
6,946,560
5
5.86%
-
-
6,896,210
6
5.82%
-
-
6,600,600
7
5.57%
-
-
6,177,200
8
5.21 %
-
-
5,492,320
9
4.63%
-
-
5,066,610
10
4.27%
-
-
-
-
3,784,200
4
0.47%
-
-
3,750,750
5
0.47%
-
-
3,739,840
6
0.47%
-
-
3,158,810
7
0.39%
-
-
3,051,071
8
0.38%
-
-
2,644,330
9
0.33%
-
-
2,617,500
10
0.33%
$ 83,290,304
70.24%
$ 52,664,371
6.58%
$118,591,735
$ 799,772,729
Source: Indian River County Property Appraiser's Office
96
City of Sebastian, Florida
Property Tax Levies And Collections
Last Ten Fiscal Years
Percent of
Percent of
Total
Current
Current Tax
Delinquent
Total
Total Tax
Tax
Tax
Collections
& Penalty Tax
Tax
Collections
Year
Levy
Collections
To Tax Levy
Collections
Collections
To Tax Levy
2010
$ 3,844,658 $
3,716,797
97 %
$ 17,723
$ 3,734,520
97 %
2009
4,441,535
4,225,106
95
51,694
4,276,800
96
2008
4,919,994
4,634,338
94
2,906
4,637,244
94
2007
4,747,938
4,537,100
96
9,429
4,546,529
96
2006
4,426,281
4,300,217
97
39
4,300,256
97
2005
3,888,488
3,723,912
96
1,712
3,725,624
96
2004
3,216,940
3,130,521
97
34,247
3,164,768
98
2003
2,862,650
2,725,515
95
26,908
2,752,423
96
2002
2,635,277
2,489,854
94
36,421
2,526,275
96
2001
2,542,544
2,455,930
97
51,690
2,507,620
99
Source: Indian River County Property Appraiser and Tax Collector
a
City of Sebastian, Florida
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
Business -type
Governmental
Activities
Activities
Water Line
Roadway
Infrastructure
Heavy
Stormwater
Golf Course
Total
Percent of
Assessment
Improvement
Sales Tax
Equipment
Utility Revenue
Revenue
Primary
Personal
Per
Year
Bonds
Notes
Bonds
Lease
Bonds
Bonds
Government
Income
Capita
2010
$ -
$2,414,000
$ 6,980,000
$
$ 4,055,000
$ -
$ 13,449,000
� 2)
587
2009
-
1,089,203
7,725,000
-
4,315,000
300,000
13,429,203
(2)
591
2008
-
1,333,197
8,445,000
-
4,570,000
590,000
14,938,197
0.19%
652
2007
-
1,566,839
9,145,000
147,538
4,815,000
870,000
16,544,377
0.21%
738
2006
-
1,790,544
9,825,000
288,251
5,055,000
1,140,000
18,098,795
0.25%
835
2005
-
2,004,718
10,490,000
422,455
5,290,000
1,395,000
19,602,173
0.31%
978
2004
-
2,209,745
11,140,000
550,452
5,525,000
1,885,000
21,310,197
0.42%
1,100
2003
77,615
2,406,028
9,500,000
672,528
-
2,115,000
14,771,171
0.31%
802
2002
134,299
2,593,939
-
788,957
2,335,000
5,852,195
0.13%
341
2001
187,901
2.773,847
-
2,435,000
� 5,396,748
0.12%
324
(') Golf Course Revenue Bonds, Series 1996 was refunded in 2001.
(2) Information not available yet.
98
City of Sebastian, Florida
Computation of Legal Debt Margin
September 30, 2010
Assessed Valuation
Assessed taxable property value for tax year 2009
Deduct: exempt property
Total Operating Taxable Value for Debt Service
Legal debt margin:
Debt limitation - 5 percent of total assessed real property value
Debt applicable to limitation
Total bonded debt
Less: revenue bonds
Total applicable to limitation
Legal debt margin
13,449,000
(11,035,000)
City adopted financial policies state the City will limit its total outstanding general obligation debt to
five percent of the assessed valuation of taxable property.
City of Sebastian, Florida
Direct and Overlapping Governmental Activities Debt
General Obligation Bonds
September 30, 2010
The City of Sebastian has no overlapping general obligation bonded debt.
1,707,231,672
558,090,532
1,149,141,140
57,457,057
2,414,000
55,043,057
all
City of Sebastian, Florida
Ratios of General Bonded Debt Outstanding and Legal Debt Margin
Last Ten Fiscal Years
Debt Limit (1)
Total net debt applicable to limit
Legal debt margin
Total net debt applicable to the limit
as a percentage of debt limit
2010 2009 2008 2007
$ 82,515,572 $ 96,696,732 $ 102,720,403 $ 106,230,784
2,414,000 1,078,787 1,333,197 1,714,377
$ 80,101,572 $ 95,617,945 $ 101,387,206 $ 104,516,407
2.93% 1.12% 1.30% 1.61%
(1 ) Under the City's adopted financial policies, the City's outstanding general obligation debt should not exceed 5% of
the assessed valuation of real property. The percentage was dropped from 10% to 5% in fiscal year 2003.
2006
2005
2004
2003
$ 76,346,170 $
57,863,758 $
47,314,698 $
41,461,231 $
2,078,796
2,427,174
2,760,196
3,078,556
$ 74,267,374 $
55,4361,584 $
44,554,502 $
38,382,675 $
2.72%
4.19%
5.83%
7.43%
2002 2001
37,729,959 $ 32,830,993
3,382,896 3,673,847
34,345,962 $ 29,157,146
8.97% 11.19%
City of Sebastian, Florida
Pledged -Revenue Coverage
Last Ten Fiscal Years
Recreational Facilities Improvement and Refunding Revenue Bonds, Series 2001
Less:
Net
Fiscal
Gross
Operating
Available
Debt Service
Year
RevenuesM
Expenses (2)
Revenue
Principal
Interest
Total
Covera e
2010 �6>
1,341,555
I,129,651
211,904
300,000
21,700
321,700
0.66
2009
1,408,535
1,178,144
230,391
570,000
49,860
619,860
0.37
2008
1,455,749
1,174,169
281,580
270,000
41,090
311,090
0.91
2007
1,701,171
1,218,382
482,789
255,000
51,590
306,590
1.57
2006
1,628,015
1,165,411
462,604
250,000
61,690
311,690
�4> 1.48 15)
2005
1,395,436
1,023,002
372,434
240,000
71,490
311,490
4) 1.20 (5)
2004
1,497,053
1,108,770
388,283
230,000
80,890
310,890
c4> 1.25 15)
2003
1,400,154
968,052
432,102
220,000
89,890
309,890
c4> 1.39 (5)
2002
1,386,424
1,020,640
365,784
100,000
104,481
204,481
1.79 (5)
2001
1,I65,091
(3) 1,043,741 (3)
121,350
-
-
-
(4) _ (5)
Note: Detail regarding the City's outstanding debt can be found in the notes to the financial statements.
(1) Total revenues including charges for services, rents, and interest.
(2) Total direct operating expenses excludes depreciation, amortization, annual Airport lease payment,
and one time hurricane repair and upgrade.
(3) Golf Course closed for four months for renovations.
(4) Golf Course Bond, Series 1992 refunded with Recreational Facilities Improvement and Refunding Revenue
Bonds, Series 2001.
(5) Required coverage is 1.25.
(6) Final payment was paid on September 30, 2010.
(7) Total revenues consist of stormwater utility fees and interest.
(8) Required coverage is 1.35.
102
Stormwater Utility Revenue Bonds, Series 2003
Gross
Debt Service
Revenues(7)
Principal
Interest
Total
Coverage(8)
$ 858,664
$ 260,000
$ 177,485
$ 437,485
1.96
814,419
255,000
185,135
440,135
1.85
856,568
245,000
191,873
436,873
1.96
932,183
240,000
197,273
437,273
2.13
908,576
235,000
201,973
436,973
2.08
792,886
235,000
206,673
441,673
1.80
779,724
105,000
104,386
209,386
3.72
103
City of Sebastian, Florida
Demographic and Economic Statistics
Last Ten Years
Total
Per Capita
Median
Personal
Personal
Household
School
Year Population Income
Income Income(1)
Income(1)
Enrollment(2)
2010 22,922 (4)
(4)
(4)
5,167
2009 22,722 (4)
(4)
(4) (5)
3,751
2008 22,924 $ 7,669,062,000
$ 57,107
$ 48,267 (5)
4,710
2007 22,426 7,810,408,000
59,419
47,563
5,117
2006 21,666 7,217,159,000
55,817
45,034
5,604
2005 20,048 6,386,893,000
50,369
44,450
5,258
2004 19,365 5,071,395,000
40,677
41,522
4,917
2003 18,425 4,831,037,000
40,162
40,291
4,340
2002 17,167 4,680,414,000
39,683
39,615
4,309
2001 16,667 4,552,238,000
39,470
39,359
1,371
Sources:
(') Florida Research & Economic Database (FRED). Information
available for Indian River County only.
(2) Indian River County School Board
(3) Indian River County Property Appraiser
(4) Information not available yet
(5) The school population appears to have declined as result
of loss of job opportunities. Our community lost many
construction jobs as a result of the declining economy.
School enrollment consists of Sebastian River High School, Sebastian River Middle School, Liberty Magnet,
Treasure Coast Elementary, Pelican Island Elementary, Sebastian Elementary
and Sebastian Charter Junior
High School
1109
Unemployment
Rate
14.4 %
13.0
7.9
5.5
4.1
4.7
6.7
6.8
7.2
5.8
State
Unemployment
Rate
11.9
10.5
6.3
4.1
3.4
3.8
4.7
5.3
5.7
4.7
Property Taxes
Per Capita
% $ 181.67 $
211.33
224.61
226.96
214.39
200.40
176.66
159.81
158.30
156.54
Total Assessed
Property Value (3)
1,707,231,672
1,996,411,138
2,119,307,997
2,180,529,368
1,578,751,030
1,208,605,441
994,907,578
874,579,785
799,772,729
698,836,022
105
City of Sebastian, Florida
Principal Employers in Indian River County
Year 2010 and 2001
Employer
School District of Indian River County
Indian River County
Indian River Medical Center
Publix Supermarkets
Piper Aircraft, Inc.
Sebastian River Medical Center
John's Island
City of Vero Beach
Visiting Nurse Association
Wal-Mart
Disney'Vero Beach Resort
Grand Harbor Management
CVS Warehouse/Distribution
Sun Ag, Inc
City of Sebastian
Total
Total County Employees
2010
2001
Percentage
Number of of Total County
Employees Employment
2,080
3.34 %
1,411
2.26
1,334
2.14
960
1.54
850
1.36
600
0.96
550
0.88
505
0.81
475
0.76
384
0.62
300
0.48
295
0.47
278
0.45
240
0.39
155
0.25
10,417
16.71 %
62,329
Percentage
Number of
of Total County
Employer
Employees
Employment
School District of Indian River Couty
1800
3.85 %
Indian River Memorial Hospital
1538
3.29
Indian River County
1464
3.13
The New Piper Aircraft
1349
2.89
Gracewood Fruit Packing
800
1.71
Publix Supermarkets
792
1.70
Wal-Mart
774
1.66
Hale Indian River Groves
675
1.45
City of Vero Beach
606
1.30
Indian River Estates
492
1.05
Total
10,290
22.03 %
Total County Employees
46,700
Source: Indian River County Community Development Report
* Principal employers information available for Indian River County only.
106
City of Sebastian, Florida
Full -Time Equivalent City Government Employees by Function/Program
Last Ten Fiscal Years
2010 2009 2008 2007 2006 2005 2004 2003 2002 2001
Function/Drogram
General Government:
City Council 2.5
2.5
2.5
2.5
2.5
2.5
2.5
2.5
2.5
2.5
City Manager 2.5
2.5
2.5
2.0
2.0
5.0
4.0
4.0
4.0
4.0
City Clerk 3.0
3.0
3.0
4.0
4.5
4.0
4.0
4.0
5.0
5.0
City Attorney -
2.0
2.0
2.0
2.0
2.0
1.0
1.0
1.0
1.0
Administrative Services 5.0
Finance -
5.0
5.0
5.0
6.0
5.0
5.0
5.0
6.0
6.0
Mgmt [nformation Svcs 3.0
3.0
3.0
3.0
3.0
2.0
2.0
2.0
0.0
0.0
Human Resources -
2.0
3.0
3.0
3.0
3.0
3.0
3.0
3.0
3.0
Facilities Maintenance 2.0
2.0
2.0
2.0
2.0
2.0
0.0
4.0
4.0
4.0
Growth Management 5.0
5.0
5.0
5.0
4.0
4.0
4.0
4.0
4.0
4.0
Public Safety:
Police Department 58.0
59.0
58.0
57.0
58.0
59.0
56.5
54.5
53.0
52.5
Building Department 5.0
5.0
6.0
11.0
11.0
9.0
8.0
7.0
7.0
6.0
Code Enforcement 2.5
2.5
2.5
3.0
3.0
0.0
0.0
0.0
0.0
0.0
Transportation:
Roads & Drainage 12.0
10.0
10.0
11.5
12.5
12.5
14.5
11.5
23.5
26.5
Central Garage 3.5
3.5
2.5
3.5
3.5
3.0
3.0
3.0
3.0
3.0
Airport 3.0
3.0
3.0
3.0
3.5
3.5
2.5
2.5
1.5
1.0
Physical Environment:
Cemetery 2.0
2.0
2.0
2.0
2.0
2.0
2.0
2.0
2.0
2.0
Engineering -
7.0
7.0
9.0
8.0
8.0
8.0
7.5
8.0
6.5
Stormwater Utility 12.0
11.0
13.0
13.0
13.0
13.0
12.0
12.0
1.0
0.0
C ultural/Recreation:
Parks & Recreation 23.0
23.5
23.5
23.5
24.5
23.5
17.5
16.5
14.0
14.0
Golf Course 10.5
9.0
9.0
12.5
12.5
12.5
13.5
13.5
14.5
12.5
Totals: 154.5
162.5
164.5
177.5
180.5
175.5
163.0
159.5
157.0
153.5
Eleven employees were moved from roads & drainage
to Sormwater
starting fiscal year 2003.
(2) Code enforcement division was transferred out of the Police Department starting
fiscal year 2006, and
transferred back in
fiscal year
2009
(3) Finance and Human Resources were combined to form Administrative Services starting
fiscal
year 2010.
(4) Engineering department was dismantled, intern program was ceased, and (2) employees
were
transferred to Roads & Drainage
and (1) employee was transferred to Stormwater
Source: City of Sebastian, Florida 2002-2011 Annual Budgets
Method: Using 1.0 for each full-time employee, and 0.50 for each part-time
and seasonal employee
107
City of Sebastian, Florida
Operating Indicators by Function/Program
Last Ten Fiscal Years
Function/program
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
General Government
Number of Annexations Approved
1
3
0
1
1
1
6
3
0
1
Acres of Annexed Property
5.9
26
0
3.87
3.3
25.55
484
80
0
80
Purchase Orders Issued
216
288
254
284
293
369
408
372
357
411
Public Safety
Police Department
Physical Arrest
487
543
662
697
744
786
653
557
515
627
Traffic Violations
4,083
4,849
4,418
7,221
6,291
5,457
5,431
1,939
2,528
2,781
Parking Violations
87
50
208
289
880
303
1801
632
207
198
Building Department
Construction Permits Issued (3)
36
23
55
104
506
774
577
544
363
315
Estimated Value of Construction (in millions)
$ 6.6
$ 5.1
$ 13.3
$ 22.5
$ 88.3
$114.7
$112.3
$ 82.7
$ 38.9
$ 29.0
Transportation
Road Maintenance (man hours)
1,264
600
538
888
512
100
878
850
827
11)
Asphalt for road maintenance (tons)
103
328
358
210
127
125
88
79
75
(1)
Concrete for road maintenance (yards) (2)
0
0
0
0
300
0
283
277
275
(1)
Physical Environment
Cemetery
Cemetery Internments
66
74
68
69
76
79
86
81
73
78
Grave Deeds Sold
33
39
46
49
56
56
69
45
54
67
Stormwater
Mile of Swales Maintained
280
280
280
280
280
280
280
280
280
28C
Mile of Ditches Maintained
50
50
50
50
50
50
50
50
50
5o
Road Crossing Maintained
40
30
30
30
30
30
30
30
30
3o
Catch Basins/Culverts
315
275
275
275
275
275
275
275
250
248
Recreation
Recreation Center attendance
11,701
13,465
12,910
14,177
8,004
5,504
7,498
(1)
(1)
(1)
Number of Discount Cards
844
879
950
1,004
2,690
1,000
993
855
890
746
Number of Golf Course Memberships
96
95
97
108
119
85
116
137
169
190
Average daily golf revenue
$3.673
$4,000
$3.988
$4,661
$4,441
$3,844
$4,551
$3,836
$3,798
$3,192
") Information not available
(2) All road maintenance utilized asphalt, no concrete curbing was installed.
(3) New Commercial and Residential Only
Sources: City of Sebastian Police Department, Growth Management, Public Works,
Golf Course, and Building Department.
108
Function/program
General Government
Square Footage Occupied
Departmental Vehicles
Public Safety
Police Stations
Square Footage of Police Department
Square Footage of Building Department
Police Vehicles
Building Inspector Vehicles
Transportation
Streets (miles)
Number of Streetlights (1)
Airport
Public Service Vehicles
Physical Environment
Public Service Vehicles
Recreation
Number of Parks
Recreation Centers
Park Acreage
Recreation Center Square Footage
Park Maintenance Vehicles
Golf Course
City of Sebastian, Florida
Capital Asset Statistics by Function/Program
Last Ten Fiscal Years
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
21,500
21,500
21,500
21,500
21,500
21,500
5,516
5,516
5,516
5,516
3
3
3
3
3
5
2
2
2
3
1
1
1
1
1
1
1
1
1
1
25,600
25,600
25,600
25,600
25,600
25,600
8,700
8,700
8,700
8,700
2,500
2,500
2,500
2,500
2,500
2,500
1,716
1,716
1,716
1,716
63
63
62
57
53
52
47
42
40
33
3
4
4
5
6
5
4
4
5
4
156
156
156
156
156
156
156
149.6
140.0
140.0
1,230
1,240
1,229
1,309
3,808
3,555
3,543
3,543
3,531
3,531
1
1
1
1
1
1
1
1
1
1
22
18
23
21
19
14
24
18
22
19
15
7
11
10
12
13
6
7
4
4
19
18
15
14
14
12
12
12
10
10
2
2
2
2
2
2
2
2
2
2
316.01
233.79
233.79
229.37
229.37
223.37
223.37
223.37
207.85
196.47
4,859
4,859
4,859
4,859
4,859
4,859
4,859
4,859
4,859
4,859
13
1
13
1
13
1
12
1
11
1
10
1
8
1
6
1
6
1
5
1
Sources: City of Sebastian Administrative Services Department and Growth Management Department
(1) This number represents actual unmetered street lights in the City. (Source: Florida Power & Light - January Billing)
109
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110
SINGLE AUDIT SECTION
The Single Audit Section contains various independent auditor's
reports and schedules as required by the Florida Single Audit Act,
Chapter 215.97, Florida Statutes for state and local governments that
receive state assistance.
➢ Independent Auditor's Report on Internal Control Over Financial
Reporting and on Compliance and Other Matters Based on an
Audit of Financial Statements Performed in Accordance with
Governmental Auditing Standards
➢ Independent Auditor's Management Letter
111
THIS PAGE INTENTIONALLY LEFT BLANK
112
Harris, Cotherman,
Jones, Price & Associates
Certified Public Accountants - Chartered
5070 North Highway AlA, Suite 250
Vero Beach, FL 32963
Tel 7 72.234-8484
Fax 772-234-8488
Report on Internal Control Over Financial Reporting
and on Compliance and Other Matters Based on an Audit of Financial
Statements Performed in Accordance with Government Auditing Standards
Honorable Mayor and Members of City Council
City of Sebastian
Sebastian, Florida
We have audited the financial statements of the City of Sebastian, Florida (the "City") as of and for the
year ended September 30, 2010, and have issued our report thereon dated February 24, 2011. We
conducted our audit in accordance with auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing Standards
issued by the Comptroller General of the United States.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered the City's internal control over financial reporting as
a basis for designing our auditing procedures for the purpose of expressing our opinion on the financial
statements, but not for the purpose of expressing an opinion on the effectiveness of the City's internal
control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the
City's internal control over financial reporting.
A deficiency in internal control exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, to prevent or
detect misstatements on a timely basis. A material weakness is a deficiency or combination of
deficiencies in internal control, such that there is a reasonable possibility that a material misstatement of
the entity's financial statements will not be prevented, or detected and corrected on a timely basis.
Our consideration of the internal control over financial reporting was for the limited purpose described in
the first paragraph of this section and was not designed to identify all deficiencies in internal control over
financial reporting that might be significant deficiencies or material weaknesses. We did not identify any
deficiencies in internal control over financial reporting that we consider to be material weaknesses, as
defined above.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City's financial statements are free of
material misstatement, we performed tests of its compliance with certain provisions of laws, regulations,
contracts and grant agreements, noncompliance with which could have a direct and material effect on the
determination of financial statement amounts. However, providing an opinion on compliance with those
provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The
results of our tests disclosed no instances of noncompliance or other matters that are required to be
reported under Government Auditing Standards.
"Providing Vision and Direction to our Clients"
Member A1CPA Member A1CPA Division For CPA Firms Member FICPA
Private Companies Practice Section
113
Harris, Cotherman,
Jones, Price & Associates
Certified Public Accountants - Chartered
Honorable Mayor and Members of City Council
City of Sebastian
Sebastian, Florida
Page two
We noted certain matters that we reported to management of the City of Sebastian, Florida in a separate
letter, Independent Auditors' Management Letter, dated February 24, 2011.
This report is intended solely for the information and use of the City of Sebastian, Florida and
management, state awarding agencies and pass -through entities, and the Auditor General of the State of
Florida and is not intended to be and should not be used by anyone other than these specified parties.
Vero Beach, Florida
February 24, 2011
114
Harris, Cotherman,
Jones, Price & Associates
Certified Public Accountants - Chartered
5070 North Highway AIA, Suite 250
Vero Beach, FL 32963
Tel 772.234-8484
Fax 772-234-8488
Independent Auditors' Report on Compliance with Requirements Applicable
to Each Major State Project and on Internal Control Over Compliance
in Accordance with the Department of Financial Services State
Projects Compliance Supplement
Honorable Mayor and Members of City Council
City of Sebastian
Sebastian, Florida
Compliance
We have audited the compliance of the City of Sebastian, Florida (the "City) with the types of compliance
requirements described in the Department of Financial Services State Projects Compliance Supplement,
that are applicable to each of its major state projects for the year ended September 30, 2010. The City's
major state projects are identified in the summary of auditors' results section of the accompanying
schedule of findings and questioned costs. Compliance with the requirements of laws, regulations,
contracts, and grants applicable to each of its major state projects is the responsibility of the City of
Sebastian, Florida's management. Our responsibility is to express an opinion on the City's compliance
based on our audit.
We conducted our audit of compliance in accordance with auditing standards generally accepted in the
United States of America; the standards applicable to financial audits contained in Government Auditing
Standards issued by the Comptroller General of the United States; Chapter 69I-5, Schedule of
Expenditures of State Financial Assistance, Rules of the Department of Financial Services; and Chapter
10.550, Rules of the Auditor General. These standards, Chapter 69I-5 and Chapter 10.550, Rules of the
Auditor General, require that we plan and perform the audit to obtain reasonable assurance about whether
non-compliance with the types of compliance requirements referred to above that could have a direct and
material effect on a major state project occurred. An audit includes examining, on a test basis, evidence
about the City's compliance with those requirements and performing such other procedures as we
considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our
opinion. Our audit does not provide a legal determination on the City's compliance with those
requirements.
In our opinion, the City of Sebastian, Florida complied, in all material respects, with the requirements
referred to above that are applicable to each of its major state projects for the year ended September 30,
2010.
"Providing Vision and Direction to our Clients"
Member AICPA Member AICPA Division For CPA Firms Member FICPA
Private Companies Practice Section
115
Harris, Cotherman,
Jones, Price & Associates
Certified Public Accountants - Chartered
Honorable Mayor and Members of City Council
City of Sebastian, Florida
Page two
Internal Control Over Compliance
The management of the City of Sebastian, Florida is responsible for establishing and maintaining
effective internal control over compliance with the requirements of laws, regulations, contracts, and
grants applicable to state projects. In planning and performing our audit, we considered the City's
internal control over compliance with requirements that could have a direct and material effect on a major
state project in order to determine our auditing procedures for the purpose of expressing our opinion on
compliance but not for the purpose of expressing an opinion on the effectiveness of internal control over
compliance. Accordingly, we do not express our opinion on the effectiveness of the City's internal
control over compliance.
A control deficiency in an entity's internal control over compliance exists when the design or operation of
a control does not allow management or employees, in the normal course of performing their assigned
functions, to prevent or detect noncompliance with a type of compliance requirement of a state project on
a timely basis. A significant deficiency is a control deficiency, or combination of control deficiencies,
that adversely affects the entity's ability to administer a state project such that there is more than a remote
likelihood that noncompliance with a type of compliance requirement of a state project that is more than
inconsequential will not be prevented or detected by the entity's internal control.
A material weakness is a significant deficiency, or combination of significant deficiencies, that results in
more than a remote likelihood that material noncompliance with a type of compliance requirement of a
state project will not be prevented or detected by the entity's internal control.
Our consideration of internal control over compliance was for the limited purpose described in the first
paragraph of this section and would not necessarily identify all deficiencies in internal control that might
be significant deficiencies or material weaknesses. We did not identify any deficiencies in internal
control over compliance that we consider to be material weaknesses, as defined above.
This report is intended solely for the information and use of the City of Sebastian, Florida and
management, state awarding agencies and pass -through entities, and the State of Florida Office of the
Auditor General and is not intended to be and should not be used by anyone other than these specified
parties. �" ( &&t4n&i , I Q�Q, �
6&/V�t ?J&�
February24, 2011
116
CITY OF SEBASTIAN, FLORIDA
Schedule of Findings and Questioned Costs
State Projects
Year Ended September 30, 2010
Section I - Summary of Auditors' Results
Internal control over major State projects:
Material weakness(es) identified? Yes X No
Reportable condition(s) identified not
considered to be material weaknesses? Yes X None reported
Type of auditors' report issued on compliance
for projects: Unqualified
Any audit findings disclosed that are required
to be reported in accordance with Chapter
10.550, Rules of the Auditor General? Yes X No
Identification of major State projects:
State CFDA Number Name of State Project
55.004 Joint Participation Agreement with Florida Department of
Transportation Aviation Administration
55.023 Lighting Maintenance and Compensation Agreement
52.013 Stan Mayfield Working Waterfront Grant Contract
Sebastian Working Waterfront Collaborative
Dollar threshold used to distinguish
between Type A and Type B projects: $300,000
Section II - Financial Statement Findings
No matters were reported.
Section III - Findings and Questioned Costs - Major State Projects
No matters were reported.
Section IV - Prior Year Findings and Questioned Costs - Major State Projects
No matters were reported.
117
City of Sebastian, Florida
Schedule of Expenditures of Federal Awards
and State Financial Assistance
For the year ended September 30, 2010
Federal/State Agency Contract
Pass -through Entity CFDA Grant
Federal Program / State Proiect No. No.
U.S. Department of Justice
Direct Programs:
Office of Justice Programs
Bulletproof Vest Partnership
ARRA - FY2009 Recovery Act Justice Assistance Grant Program
Indirect Programs:
Passed through Florida Department of Law Enforcement
ARRA - Recovery Act Justice Assistance Grant
Justice Assistance Grant
Total U.S. Department of Justice
U.S. Department of Transportation
Direct Programs:
Design East Access Road
Runway 4/22 Improvements
Total U.S. Department of Transportation
TOTAL EXPENDITURES OF FEDERAL AWARDS:
16.607 N/A
16.804 2009-S13-139-2156
16.803 2010-ARRC-INRI-4-W&-152
16.738 2010-JAGD-INRI-4-4Y-067
20.106 12-0145-008-2008
20.106 12-0145-009-2009
The accompanying notes are an integral part of the audit.
118
Transfers to
EXDenditures Subrecipients
$ 2,100 $
789
28,329
5,834
37,052
51,627
342,066
393,693
$ 430,745 $
City of Sebastian, Florida
Schedule of Expenditures of State Financial Assistance
For the year ended September 30, 2010
State Agency
Contract
Pass -through Entity
CSFA
Grant
State Proiect
No.
No.
Department of Transportation
Direct Projects:
Joint Participation Agreement with Florida
Department of Transportation Aviation
Administration:
Construct Access Road
55.004
407706-1-94-01
Construct Hangars
55.004
418164-1-94-01
Construct Hangars
55.004
416287-1-94-01
Design Runway Rehab, Lighting & Marking
55.004
426172-1-94-01
District Maintenance
Lighting Maintenance and Compensation Agreement
55.023
405122-1-78-10
Total Department of Transportation
Florida Department of Community Affairs
Florida Communities Trust (FCT)
Stan Mayfield Working Waterfront Grant Contract
Sebastian Working Waterfront Collaborative
52.013
08-003-WW1
Total Florida Department of Community Affairs
TOTAL EXPENDITURES OF STATE FINANCIAL ASSISTANCE:
The accompanying notes are an integral part of the audit.
Expenditures
$ 495,780
3,426
2,952
9,002
18,559
529,719
2,556,872
2,556,872
$ 3,086,590
119
City of Sebastian, Florida
Notes to Schedule of Expenditures of State Financial Assistance
September 30, 2010
The accounting policies and presentation of the Single Audit Report of City of Sebastian, Florida, (the "City") have been
designed to conform to generally accepted accounting principles as applicable to governmental unites, including the reporting
and compliance requirements of the Audits of State, Local Governments, and Non -Profit Organizations and the Florida Single
Audit Act.
A. Reporting Entity
The reporting entity consists of City of Sebastian, the primary government, and each of its component units. The City includes a
Schedule of Expenditures of Federal Awards and State Financial Assistance in the Single Audit Section.
B. Basis of Accountine
Basis of accounting refers to when revenues and expenditures or expenses are recognized in the accounts and reported in the
financial statements. Basis of accounting relates to the timing of measurements made, regardless of the measurement focus.
The modified accrual basis of accounting is followed in the Schedule of Expenditures of State Financial Assistance. Under the
modified accrual basis, revenues are recognized when they become measurable and available. Revenues are considered to be
available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For
this purpose, the City considered revenues to be available if they are collected within one year after the end of the current fiscal
period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting.
120
Harris, Cotherman,
Jones, Price & Associates
Certified Public Accountants - Chartered
5070 North Highway AlA, Suite 250
Vero Beach, FL 32963
Tel 772.234.8484
Fax 772-234.8488
Independent Auditors'
Management Letter
Honorable Mayor and Members of City Council
City of Sebastian
Sebastian, Florida
We have audited the financial statements of the City of Sebastian, Florida as of and for the fiscal year
ended September 30, 2010 and have issued our report thereon dated February 24, 2011.
We conducted our audit in accordance with United States generally accepted auditing standards; the
standards applicable to financial audits contained in Government Auditing Standards issued by the
Comptroller General of the United States; and the Florida Single Audit Act. We have issued our Report
on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of
Financial Statements Performed in Accordance with Government Auditing Standards, Independent
Auditors' Report on Compliance and Internal Control with Requirements Applicable to Each Major
Program and State Project and on Internal Control Over Compliance in Accordance with OMB circular
A-133 and Chapter 10.550, Rules of the Auditor General, and Schedule of Findings and Questioned
Costs. Disclosures in those reports and schedule, which are dated February 24, 2011, should be
considered in conjunction with this management letter.
Additionally, our audit was conducted in accordance with the provisions of Chapter 10.550, Rules of the
Auditor General, which govern the conduct of local governmental entity audits performed in the state of
Florida and require that certain items be addressed in this letter.
The Rules of the Auditor General (Section 10.554(1)(i)l) require that we address in the management
letter, if not already addressed in the auditors' reports on Compliance and Internal Control or Schedule of
Findings and Questioned Costs, whether or not recommendations made in the preceding annual financial
audit report have been followed. All findings and comments in the prior year have been resolved to our
satisfaction.
As required by the Rules of the Auditor General (Section 10.554(1)(i)2), the scope of our audit included a
review of the provisions of Section 218.415, Florida Statutes, regarding the investment of public funds.
In connection with our audit, we determined that the City of Sebastian, Florida complied with Section
218.415, Florida Statutes.
The Rules of the Auditor General (Section 10.554(1)(i)3) require that we address in the management letter
any findings and recommendations to improve financial management, accounting procedures, and internal
controls. Nothing came to our attention that requires disclosure in the current year.
"Providing Vision and Direction to our Clients"
Member A1CPA Member A1CPA Division For CPA Firms Member FICPA
Private Companies Practice Section
121
Harris, Cotherman,
Jones, Price & Associates
Certified Public Accountants - Chartered
Honorable Mayor and Members of City Council
City of Sebastian, Florida
Page two
The Rules of the Auditor General (Section 10.554(1)(i)5) require disclosure in the management letter of
the following matters if not already addressed in the auditors' reports on compliance and internal control
or Schedule of Findings and Questioned Costs: (1) violations of laws, rules, regulations, and contractual
provisions that have occurred, or are likely to have occurred; (2) improper or illegal expenditures; and (3)
control deficiencies that are not significant deficiencies, including, but not limited to: (a) improper or
inadequate accounting procedures (e.g., the omission of required disclosures from the financial
statements); (b) failures to properly record financial transactions; and (c) other inaccuracies, shortages,
defalcations, and instances of fraud discovered by, or that come to the attention of, the auditor.
The Rules of the Auditor General (Section 10.554(1)(i)6) also require that the name or official title and
legal authority for the primary government and each component unit of the reporting entity be disclosed
in the management letter, unless disclosed in the notes to the financial statements. The legal authority for
the City of Sebastian, Florida is disclosed in the notes to the financial statement. The City of Sebastian,
Florida's component unit, the Police Officer's Pension Plan, was established under Section 58-46 through
58-54 Code of Ordinances in October 1989.
As required by the Rules of the Auditor General (Section 10.554(1)(i)7.a), the scope of our audit included
a review of the provisions of Section 218.503(1), Florida Statutes, regarding financial emergencies. In
connection with our audit, we determined that the City of Sebastian, Florida has not met any of the
financial emergency conditions described in Section 218.503(1), Florida Statutes.
As required by the Rules of the Auditor General (Section 10.554(1)(i)7.b.), we determined that the annual
financial report for the City of Sebastian, Florida for the fiscal year ended September 30, 2010, filed with
the Department of Financial Services pursuant to Section 218.32(1)(a), Florida Statutes, is in agreement
with the annual financial audit report for the fiscal year ended September 30, 2010.
As required by the Rules of the Auditor General (Section 10.554(1)(i)7.c. and 10.556(7)), we applied
financial condition assessment procedures. It is management's responsibility to monitor the entity's
financial condition, and our financial condition assessment was based in part on representations made by
management and the review of financial information provided by the same.
This report is intended solely for the information and use of the City of Sebastian, Florida and
management, federal and state awarding agencies and pass -through entities, and the State of Florida
Office of the Auditor General and is not intended to be and should not be used by anyone other than these
spe
cified partiee�s.� �y'
(�112 t alnai1 / ) 9i�LC.?� 0( litA.tl.dCLl,�•4%
P�
Vero B�orida
February 24, 2011
122