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Home My WebLink About1999 - 2000CITY OF SEBASTIAN, FLORIDA PAUL KROEGEL 1864 -1948 Audubon Warden 1902 • First Refuge Warden 1903 -1926 PELICAN ISLAND NATIONAL WILDLIFE REFUGE Established March 14,1903 COMPREHENSIVE ANNUAL FINANCIAL REPORT For The Fiscal Year October 1,1999 Through September 30, 2000 CITY OF SEBASTIAN, FLORIDA CITY OF HOME OF PELICAN ISLAND Comprehensive Annual Financial Report For the Year Ended September 30, 2000 CITY COUNCIL Walter W. Barnes ............................... Mayor Ben A. Bishop ...................................... Vice -Mayor JoeBarczyk......................................... Councilmember Edward J. Majcher, Jr ....................... Councilmember James A. Hill ....................................... Councilmember CITY OFFICIALS Terrence R. Moore.......................................City Manager Sally A. Maio, CMC.....................................City Clerk Rich Stringer................................................City Attorney Mark C. Mason, CPA..................................Director of Finance Prepared By: Finance Department C11Y OF iZ-Fpaw Q4 17 1 HOME OF PELT CAN ISLAND THIS PAGE INTENTIONALLY LEFT BLANK 9 INTRODUCTORY SECTION This section contains the following subsections: Table of Contents Letter of Transmittal Organizational Chart M CITY OF SEBASTIAN, FLORIDA COMPREHENSIVE ANNUAL FINANCIAL REPORT SEPTEMBER 30, 2000 TABLE OF CONTENTS INTRODUCTORY SECTION Page TitlePage...................................................................................................................................................... i Tableof Contents.......................................................................................................................................... .. ttt Letterof Transmittal...................................................................................................................................... A Certificate of Achievement for Excellence in Financial Reporting............................................................... xiv OrganizationalChart ............. :....................................................................................................................... xv FINANCIAL SECTION - IndependentAuditor's Report ....................................................................................................................... 2 Combined Financial Statements — Overview Exhibit Combined Balance Sheet — Primary Govemment Fund Types and AccountGroups .................... :.................... ......................... ................................ 1 5 Combined Statement of Revenues, Expenditures, and Changes in Fund Balances — All Governmental Fund Types and Expendable TrustFunds......................................................................................................... 2 9 Combined Statement of Revenues, Expenditures, and Changes in Fund Balances — Budget and Actual (Budgetary Basis) — General, Special Revenue, and Debt Service Funds.......................................................... 3 11 Combined Statement of Revenues, Expenses, and Changes in Equity - All Proprietary Fund Types ........... :...................................................................... 4 13 Combined Statement of Cash Flows — All Proprietary Fund Types ....................... 5 14 Combined Statement of Changes in Plan Net Assets — All Pension TrustFunds ......... :............................................................................................... 6 16 Notes to Financial Statements................................................................................ 17 Required Supplementary Information..................................................................... 32 Primary Government— Combinine and Individual Fund Statements/Schedules, Statement/Schedule General Fund Comparative Balance Sheets.................................................................................. A-1 36 Comparative Statements of Revenues, Expenditures, and Changes in FundBalances............................:........................................................................ A-2 37 Statement of Revenues, Expenditures, and Changes in Fund Balances — Budget and Actual (Budgetary Basis) — General Fund ....................................... A-3 39 Special Revenue Funds CombiningBalance Sheet....................................................................................... B-1 43 Combining Statement of Revenues, Expenditures, and Changes in FundBalances..................................................................................................... B-2 44 Community Development Block Grant Special Revenue Fund — Statement of Revenues, Expenditures, and Changes in Fund Balance — Budget to Actual (BudgetaryBasis).................................................................:............I..........I..... B-3 45 iii Statement/Schedule Page Local Option Gas Tax Special Revenue Fund — Statement of Revenues, Expenditures, and Changes in Fund Balance — Budget to Actual (Budgetary Basis)............................................................................................... B-4 46 r� Discretionary Sales Surtax Special Revenue Fund — Statement of Revenues, Expenditures, and Changes in Fund Balance — Budget to Actual (Budgetary Basis)............................................................................................... B-5 47 Capital Projects Funds Combining Balance Sheet....................................................................................... C-1 49 Combining Statement of Revenues, Expenditures, and Changes in FundBalances..................................................................................................... C-2 50 Enterprise Funds Combining Balance Sheet....................................................................................... D-1 53 Combining Statement of Revenues, Expenses, and Changes in RetainedEarnings............................................................................................... D-2 54 Combining Statement of Cash Flows...................................................................... D-3 55 Fiduciary Funds Combining Balance Sheet....................................................................................... E-1 59 All Expendable Trust Funds — Combining Statement of Revenues, Expenditures, and Changes in Fund Balances........................................................................... E-2 61 Performance Deposits Fund — Statement of Changes in Assets and Liabilities...... E-3 62 General Fixed Assets Account Group Schedule of General Fixed Assets — By Sources .................................................... F-1 65 Schedule of General Fixed Assets by Function and Activity .................................. F-2 66 Schedule of Changes in General Fixed Assets by Function and Activity ............... F-3 67 General Lone -Term Debt Account Group Schedule of General Long -Term Obligations......................................................... G-1 70 STATISTICAL SECTION (Unaudited) Table General Governmental Expenditures & Other Financing Uses by Function — LastTen Fiscal Years.......................................................................................... 1 73 General Governmental Revenues & Other Financing Sources — Last Ten FiscalYears........................................................................................................ 2 75 Property Tax Levies and Collections — Last Ten Fiscal Years ............................... 3 77 Assessed and Estimated Actual Value of Property — Last Ten Fiscal Years .......... 4 79 PrincipalTaxpayers................................................................................................ 5 81 Property Tax Rates — Direct and Overlapping Governments — Last Ten FiscalYears........................................................................................................ 6 82 Special Assessments Billing and Collections — Last Ten Fiscal Years ................... 7 83 Computation of Legal Debt Margin... ..................................................................... 8 84 iv Table Page Ratio of Net General Obligation Bonded Debt to Assessed Value and Net ^ General Obligation Bonded Debt Per Capita ...................................................... 9 85 Ratio of Annual Debt Service Expenditures for General Obligation Bonded Debt To Total General Government Expenditures...................................................... 10 85 Computation of Direct and Overlapping Bonded Debt — General Obligation Bonds.................................................................................................................. 11 86 Revenue Bond Coverage —Golf Course Bond —Last Ten Fiscal Years ................. 12 87 Demographic Statistics — Last Ten Fiscal Years .................................................... 13 88 Property Value, Construction and Bank Deposits — Last Ten Fiscal Years............ 14 89 Miscellaneous Statistics.......................................................................................... 15 91 SINGLE AUDIT SECTION ^ Report on Compliance and on Internal Control over Financial Reporting Based on an Audit of Financial Statements Performed in Accordance with Governmental Auditing Standards...................................................................... 94 Report on Compliance with Requirements Applicable to Each Major Program and Internal Control Over Compliance in Accordance With OMBCircular A-133.......................................................................................... 96 Schedule of Findings and Questioned Costs........................................................... 98 Schedule of Federal Awards................................................................................... 99 ^ Independent Auditor's Report on Examination of Management's Assertion About Compliance with Specified Requirements ................................................ 100 City of Sebastian Management's Assertion about Compliance with Specified Requirement........................................................................................................ 102 Schedule of State of Florida Financial Assistance .................................................. 103 ^ Independent Auditor's Management Letter Comments .......................................... 104 Response to Management Letter Comments........................................................... 106 ^ ^ V - - so CITY OF SEBASTIAN HOME Of PELICAN ISLAND 1225 MAIN STREET • SEBASTIAN, FLORIDA 32958 TELEPHONE: (561) 589-5330 • FAX (561) 589-5570 January 24, 2001 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, 2000, as prepared by the City's Finance department. Responsibility for both the accuracy of the data presented and the completeness and fairness of the presentation, including all disclosures, rests with the - City. The Comprehensive Annual Financial Report is presented in four sections: - 1. Introductory section, including a table of contents, this letter of transmittal, and the organizational chart. 2. Financial section, including the general purpose financial statements accompanied by our independent auditor's report, notes to financial statements, and the combining and individual fund and account group financial statements and schedules. 3. Statistical section, including selected financial and demographic information, generally presented for the past 10 years. 4. Single audit section, including our independent auditor's reports, Schedule of Federal Awards, and Schedule of State Financial Assistance. This report complies in all material respects with the authoritative promulgations by the Governmental Accounting Standards Board (GASB). An explanation of the City's accounting policies is contained in the Notes to Financial Statements, which are an integral part of this Report. These Notes explain the basis of accounting, funds and accounts used, and other significant accounting information. Independent Audit - Chapter 11.45, Florida Statutes requires that the financial statements of the City of Sebastian be audited by a certified public accountant selected by the City Council. This audit has been completed by the City's independent Certified Public Accountants, Hoyman, Dobson & Company, P.A. Their opinion is included in this Report. W An Equal Opportunity Employer" Celebrating Our 75th Anniversary vi ReDortin2 Entitv The City of Sebastian is located on the central east coast of Florida, "the Treasure Coast", in Indian River County. The City is a Florida municipal corporation with a five -member City Council comprised of five council members with a Mayor selected from the five members. The City operates under a Council -City Manager form of government. The Director of Finance reports to the City Manager and they are responsible for the administration of City finances. The City provides a wide range of services including general government administration, police protection, public works, a golf course, and a general aviation airport. This report includes all funds and account groups 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 Community Redevelopment Agency and the Sebastian Police Officer's Pension Trust Fund. ECONOMIC CONDITION AND OUTLOOK 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 Wal-Mart Stores, Ina® and Winn Dixie Stores, Inc.® The Indian River County Unemployment rate in 2000 was 9.5% up from 8.6% in the previous year and down from a high of 11.9% in 1992. This indicates that the business growth in the area has improved as evidenced by the construction of a new Publix. , a charter school and a new hotel. However, there has been a downturn in the citrus industry in Indian River County leading to the higher unemployment rate in fiscal year 2000. Continued stability in the area and the increase of annual residential building permits issued provides a trend for steady economic development in the area. For the 1999-2000 fiscal year, the millage rate was decreased from 6.5 to 5.0 or 23.1%. This large decrease was offset by a significant increase in revenue from the removal of a cap of $2.50 on public utility taxes. These changes had no significant impact on the General fund since fund balance is not generally used to fund operations. �+ Beginning undesignated fund balance for the General fund is $2,329,117 or 33.2% of the 1999-2000 fiscal year budget. The Golf Course and Airport are self-supporting enterprises. Both have sufficient rates and fees to provide for costs of operations and to finance capital improvements. FINANCIAL INFORMATION Internal Accountine Controls M In developing and evaluating the City's accounting system, consideration is given to the adequacy of internal accounting controls. Internal accounting controls are designed to provide reasonable, but not absolute, assurances regarding: (1) the safeguarding of assets against loss from unauthorized use or disposition; and (2) the reliability of financial records for preparing financial statements and maintaining accountability for assets. The concept of .. reasonable assurance recognizes that: (1) the cost of a control should not exceed the benefits likely to be derived, and (2) the evaluation of costs and benefits requires estimates and judgements of management. All internal control evaluations occur within this framework. We believe that the City's internal accounting controls adequately safeguard assets and provide reasonable assurance of proper recording of financial transactions. vii W Budgetary Control Budgetary control is maintained at the budget account level by the encumbrance of estimated purchase amounts prior to the release of purchase orders to vendors. Open encumbrances are reported as reservations of fund balances as of September 30, 2000. Appropriations are approved on an annual basis and are subject to regular review by City Management and a quarterly review by the City Council. Monthly budget reports are submitted to senior administrative officials and are available to the City Council. Cash Manaeement Cash temporarily idle during the year was invested in repurchase agreements and other obligations with maturities .� less than one year. Funds were invested with the State Board of Administration which pools funds from local governmental units and with local banks which are considered Qualified Public Depositories as described in the Florida Security for Public Deposits Act. In addition, the City maintains a zero balance disbursement account system whereby excess funds are cleared from the account at the end of each banking day and automatically invested in an overnight repurchase agreement. M so W Debt Administration The City of Sebastian has no general obligation debt. There are various bond issues and notes payable for which specific revenues are pledged for repayment. The Golf Course is self-supporting, that is, the revenues of the Golf Course fund will provide for the debt service requirement. No bonds were issued during the 1999-2000 fiscal year. Outstanding bonded indebtedness, net of unamortized discount, and note payable of the City at September 30, 2000, is summarized below: Primary Government Public Improvement Note Payable Revenue Bonds Total primary government Balance Bonds Balance 10/1/99 Retired 9/30/00 $3,111,041 $164,928 $2,946,113 1,875,052 155,980 1,719,072 Risk Manaeement All risk management activities are recorded in each particular fund, including general property liability insurance premiums and related costs and workers compensation. The City administers both policies under the direction of the Finance and Human Resources departments, respectively. In addition, the City has a Safety Committee that reviews all worker compensation accidents and provides recommendations for corrective action. viii M General Fund The General fund accounts for all activities of the City not included in other specific funds. Such activities �. include general governmental administration, police protection, and public works. The general fund revenues and transfers from other funds as compared to the previous year are summarized as follows (in thousands): Increase (Decrease) Source 2000 1999 From 1999 Property taxes $2,323 $ 2,727 $ (404) Other taxes 1,695 1,073 622 Licenses and permits 475 449 26 Intergovernmental 1,471 1,372 99 ■a Charges for services 160 33 127 Fines, forfeitures, penalties and fees 141 90 51 Interest and other revenues 334 244 90 Total revenues $6,599 $ 5,988 $ 611 Transfers from other funds 11 274 (263) Net extraordinary revenue 103 - 103 Total revenues and other financing sources MM $ $ 451 General fund revenues totaled $6,713,168 for the fiscal year, an increase of $451,450 or 7.2% from 1999 amounts. This increase results primarily from a removal of a tax cap of $2.50 on public utility taxes allowing for full collections of the 10% tax. Franchise fees increased modestly due to regular construction of new homes and commercial enterprises. Property taxes decreased as a result of lowering the millage rate 23.1% from 6.5 to 5.0. This has resulted in a decreased reliance on property taxes as a main funding source from 44% to 35% of revenue. Intergovernmental revenue increase due to growth related increases from State revenue sharing sources. Licenses and permits increased as a result of increased commercial construction. Charges for services increased $126,604 or 383% resulting from increased charges to enterprise funds for administrative services as well as personal services and equipment usage charges to capital projects for in-house construction. Interest and other revenues .� increased as a result of higher interest rates on invested balances and contributions for new playground equipment. Net extraordinary revenue consists of State and federal emergency management funds and insurance proceeds as a result of damages incurred from indirect hits from Hurricanes Floyd and Irene. The chart below shows the relative distribution of the General fund revenues. Charges for services 2% GENERAL FUND REVENUES FY 1999-2000 .. IntcresVother Transfers in Fines/fees A 1% Net Extraordinary Revenue 2% 2% Properly taxes _ 35% -mom pn Intergovemmental 21% Licenses and permits 7 % Other taxes 25% The General fund expenditures and transfers to other funds, as compared to the previous year are summarized by governmental function as follows (in thousands): Increase (Decrease) Function 2000 1999 From 1999 General government $ 1,783 $ 1,684 $ 99 Police 2,130 2,123 7 Public works 2,008 1,909 99 Debt service - 32 (321 Total expenditures $ 5,921 $ 5,748 $ 173 Transfers to other funds 684 415 269 Residual equity transfers out 4,128 (4,128) Total expenditures and other financing uses M on Expenditures of the General fund totaled $6,605,643, a decrease of $3,685,149 or 35.8% over 1999 amounts. This results primarily from the decrease in residual equity transfers out used in the prior year to reclassify capital projects to capital project funds. Increases in general government expenditures and public works results from contract required and council approved personal services increases. The Police department's increase reflects the addition of Code Enforcement as a division and a decrease in capital outlay as well as Council approved salary increases and benefits package. In addition, the General fund fund balance was used to fund certain improvements in City Hall resulting in an increase in transfers to other funds. GENERAL FUND EXPENDITURES FY 1999-2000 Transfers to other Public works 31% 32% General government 27% General fund expenditures, encumbrances, operating transfers out, and extraordinary item were $452,139 below budgeted amounts. General fund expenditures, encumbrances, operating transfers out, and extraordinary item were less than revenues and operating transfers in by $43,184. The General fund's undesignated fund balance .� increased $75,642 in the 1999-2000 fiscal year. M Special Revenue Funds The revenues of the Special Revenue funds are derived from specific sources and are designated for specific uses. �• Discretionary Sales Tax represents an additional $.01 sales tax and is designated for capital improvements and equipment with a life of five years or more. Discretionary Sales Tax revenue was $1,704,749 for the year ended September 30, 2000 an increase of 9.7% or $151,077. The Local Option Gas Tax fund accounts for the local option gas tax revenues and expenditures from this revenue source. Local Option Gas Tax revenues were $549,800 during the 1999-2000 fiscal year, an increase of $65,746 or 13.6% and were used for street lighting, debt service for the Road Paving Note Payable, and transfers to the Transportation Capital Projects fund to be used for various street and bridge maintenance and improvement projects. .., Debt Service Fund r� The Debt Service fund is used to account for special assessment funds associated with a water line improvement in the riverfront area of the City. In addition, the funds are accumulated to pay principal and interest on the 1996 Revenue Bond. Capital Proiects The Capital Projects funds include all major capital improvement projects of the City other than those accounted .. for in the City's Proprietary funds. Revenues consist of transfers from the General fund, certain Special Revenue funds, intergovernmental revenues, and interest income. Expenditures for capital improvement projects in fiscal year 1999-2000 totaled $4,495,642. The major capital expenditure in 2000 was for road reconstruction and paving improvements in the amount of $1,568,920. Other significant projects were the bridge reconstruction for four bridges, drainage improvements, pier and boat ramp ,. replacements and the purchase of property for park use. Thirty-seven capital improvement projects were in process during the 2000 fiscal year. General Fixed Assets M The general fixed assets of the City are those fixed assets used in the performance of general governmental functions and exclude the fixed assets of the City's Proprietary funds. As of September 30, 2000, the general fixed assets of the City amounted to $24,686,758. This amount represents the original cost of the assets. The current value is considerably less because depreciation of general fixed assets is not recognized in the City's accounting system. Public domain general fixed assets such as streets, sidewalks, curbs, gutters, bridges, and drainage systems are capitalized. no ., Enterprise Funds Pertinent information on the City's Enterprise funds as compared to the previous fiscal year is summarized as + follows: Golf Course Fund Increase (Decrease) Function 2000 1999 From 1999 Operating revenues $1,367,405 $1,354,999 $ 12,406 + Operating expenses (1,120,435) (1,089.641) 30794 Operating income 246,970 265,358 (18,388) Non -Operating revenues 83,082 59,977 23,105 + Non -Operating expenses (96,980) (102,650) 5,670 Extraordinary item 21,256 21,256 Net income L-251M 22 �Q3 + Operating revenues increased $12,406 primarily due to the excellent weather enjoyed during the fiscal year resulting in an increase of 1,515 rounds played. There were no changes to the greens fees or rates in 2000. The increase in operating expenses results from a decrease in the Airport lease due to a one time catch up in lease payments in the prior year. This was offset by an increases in personal services, administrative fees to the General fund, the golf course maintenance contract, and depreciation. In addition, interest income increased due to favorable rates and a decrease in interest paid on the revenue bond resulted in an increase in net income. Aimort Fund Increase (Decrease) Function 2000 1999 From 1999 Operating revenues $ 85,992 $ 122,265 $ (36,273) Operating expenses (192,796) (80,390) 112 406) Operating income (106,804) 41,875 (148,679) + Non -Operating revenues 102,688 13,187 89,501 Net income + Operating revenues decreased as a result of returning to the normal lease amount following a one-time increase in lease payments from the golf course in the prior year. The Golf Course leases the land from the Airport pursuant to a lease agreement with increases every five years in accordance with the CPI. Operating expenses increased + due to charges for an Airport Master Plan of $104,211. In addition, interest income increased due to favorable interest rates. Non -operating revenues increased as a result of securing Joint Participation Agreements with the Florida Department of Transportation to fund a new radio system as well as a Five -Year Airport Master Plan in the amount of $240,000. Trust and Aeencv Funds The Trust and Agency funds are used to account for assets held by the City in a trust or fiduciary capacity and include the Cemetery Trust, Law Enforcement Trust, law Enforcement Education Trust, Public Safety Employee Trust, General Employee Trust, Police Pension Trust, Major Equipment Replacement Trust, and Performance Deposits. The largest of these funds is the Police Pension Trust which had net assets at September 30, 2000 of w� $2,200,969. In addition, during the year the Cemetery Trust Fund sold land for $201,500. Also, a new Excavator was purchased for $104,621 via the Major Equipment Replacement Trust Fund. + OR xii Retirement Commitments Police Pension Plan — There were 35 active and retired members in the Police Pension Plan as of September 30, 2000. This pension plan is a single employer, defined benefit plan and is administered by a Board of Trustees. The actuarially determined funding requirements are based upon the market value of the pension plan's investment portfolios. The City's policy of funding to meet the actuarially determined requirements was met for 2000. The City's contributions totaled $196,773 or 17.5% of covered payroll. ., MAJOR INITIATIVES Aimort The Airport has obtained Joint Participation Grunts at 80% of estimated costs for the purpose of installing new runway lighting in the amount of $108,000 and rehabilitation of airport taxiways for $500,000. Continued work on an Airport Master Plan will provide a blueprint for future growth at the airport. Park imorovements .. The City received a $170,000 grant from the Florida Inland Navigation District for the purpose of building two docks with boat slips and additional park facilities. .. Road Pavine Improvements Work continues on a Road Paving Program which began early this fiscal year and saw over 25 miles of roads reconstructed and/or repaved at a cost of $1,568,920, with an additional 35 miles of roads to be reconstructed and/or repaved in fiscal year 2001 at an estimated cost of $1,500,000. Stormwater Drainaee Improvements The City entered into an agreement with St. John's River Water Management District to fund half the cost of a Stormwater Master Plan estimated at $200,000. The Stormwater Master Plan will provide information to reduce .. pollutant loads into the surrounding estuaries to comply with State and federal environmental laws. Reportine Achievement 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, 1999. This was the first year that the government has achieved this prestigious award. 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 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. Acknowledeements The preparation of this report would not be possible without the dedicated service of the Finance 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. Respectfully submitted, , Mark C. Mason, CPA V'rer of Fi nce . Moore City Manager 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, 1999 — 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. ice i � ux�n SAM nn>E.c N NO 0 £ CNAO" resident cmvoanmx s sssa. P��~ Directto,..rA�---(/.C"/, xiv CITY OF SEBASTIAN ORGANIZATIONAL CHART CITIZENS OF I SEBASTIAN BOARDS & CITY C UNCIL I COMMISSIONS CITY CITY CLERK i ATTORNEY I CITY MANAGER I I GROWTH I I I I I MANAGEMENT FINANCE I ENGINEERING I POLICE I PUBLIC WORKS GOLFCOURSE AIRPORT I HI MAN I ROADS & BUILDING RESOURCES ADMINISTRATION I -j DRAINAGE PATROL I CENTRAL GARAGEI 11 CODE BUILDING ENFORCEMENT MAINTENANCE I J PARKS & . DETECTIVE RECREATION I CEMETERY DISPATCH I I I I I I I I I I I I I I I I I I I I FINANCIAL SECTION This section contains the following subsections: ➢ Independent Auditor's Report General Purpose Financial Statements Combining and Individual Funds and Account Groups Statements so �HOYMAN, DOBSON & COMPANY, P.A. as� CERTIFIED PUBLIC ACCOUNTANTS 215 Boytree Drive, Suite 1, Melbourne, Florida 32940,321-255-0088., Fox 321-259-8648, vvvw.hoyman.com Chorles'✓d Hoymon,jr Barbara J, Oswalt Thomas L. Kirk �I Karen E, Kirkland Deborah A. Bradley DIRECTOR EMERITUS Roger Dobson r•R Eugene K. Bjermng w Independent Auditor's Report Honorable Mayor and Members of City Council City of Sebastian .. Sebastian, Florida We have audited the accompanying general purpose financial statements of the City of Sebastian, I, Florida, as of and for the year ended September 30, 2000, as listed in the table of contents. These general purpose financial statements are the responsibility of the City of Sebastian, Florida's, management. Our responsibility is to express an opinion on these general purpose financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards 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 general purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the general purpose financial statements. An audit also includes .. assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall general purpose financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the general purpose financial statements referred to above present fairly, in all material respects, the financial position of the City of Sebastian, Florida, as of September 30, 2000, �. and the results of its operations and the cash flows of its proprietary fund types for the year then ended in conformity with generally accepted accounting principles. W OR MR 2 • American Institute of Certified Public Accountants • Florida Institute of Certified Public Accountants • SEC Practice Section of the A.I. C. PA • CPAmerico International Honorable Mayor and Members of City Council City of Sebastian — Page Two In accordance with Government Auditine Standards, we have also issued our report dated December 11, 2000, on our consideration of the City of Sebastian, Florida's internal control over — financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants. Our audit was performed for the purpose of forming an opinion on the general purpose financial statements taken as a whole. The combining and individual fund and account group financial statements and schedules listed in the table of contents are presented for purposes of additional — analysis and are not a required part of the general purpose financial statements of the City of Sebastian, Florida. The accompanying schedule of expenditures of federal awards is presented for purposes of additional analysis as required by U.S. Office of Management and Budget Circular A- 133, Audits of States. Local Governments and Non -Profit Oreanizations, and is also not a required part of the general purpose financial statements of the City of Sebastian, Florida. Such information has been subjected to the auditing procedures applied in the audit of the general purpose financial — statements and, in our opinion, is fairly stated, in all material respects, in relation to the general purpose financial statements taken as a whole. Hoyman, Dobson & Company, P.A. December 11, 2000 3 - GENERAL PURPOSE FINANCIAL STATEMENTS The General Purpose Financial Statements include all funds and account groups of the Primary Government and its component units to provide an overview of the financial position and results of operation for the Financial Reporting Entity as a whole. Detailed financial statements for each fund and account group of the Primary Government including the blended component units are presented elsewhere in this Report. 4 Exhibit 1 1 of CITY OF SEBASTIAN, FLORIDA COMBINED BALANCE SHEET PRIMARY GOVERNMENT FUND TYPES AND ACCOUNT GROUPS SEPTEMBER 30, 2000 ASSETS AND OTHER DEBITS Cash and cash equivalents Equity in pooled investments Investments Accounts receivable, net Employee contribution receivable Interest receivable Assessments receivable Due from other funds Due from other governments Inventory Prepaid items Restricted investments General fixed assets Property, plant and equipment, net Unamortized bond issue costs Amount available for debt service Amount to be provided for retirement of general long-term obligations Total assets and other debits Governmental Fund Types Special Debt General Revenue Service $ 79,673 $ 7,889 $ — 2,613,856 181,794 171,866 188,208 194 10 126,332 258 194,453 268,249 7,454 2,069 — Capital Projects 1,209,813 1,807,826 11,912 169,380 M w M w 7 7 n M M $ 3,085,971 $ 458,126 $ 298,208 $ 3,198,931 w The accompanying notes to financial statements are an integral part of this financial statement. r. 5 M M Proprietary Fiduciary Totals Fund Fund (Memorandum Types Types Account Groups Only) General General Trust Fixed Long -Term Primary Enterprise and Agency Assets Obligations Government $ $ — $ $ $ 87,562 1,210,796 463,829 5,851,954 — 2,198,757 — 4,006,583 248 -- 200,368 — 2,212 — 2,212 53 15,947 16,204 .. — -- 126,332 — — — 258 96,464 728,546 10,945 — 18,399 3,900 — 5,969 346,018 — 346,018 — — 24,686,758 — 24,686,758 1,504,441 -- 1,504,441 48,703 — -- — 48,703 — _ 171,866 171,866 -- — -- 3,293,618 3,293,618 $ 3,221,568 $ 2,680,745 $ 24,686,758 $ 3,465,484 $ 41,095,791 w M M H (Continued) Exhibit 1 2 of 4 w Exhibit 1 3 of CITY OF SEBASTIAN, FLORIDA COMBINED BALANCE SHEET PRIMARY GOVERNMENT FUND TYPES AND ACCOUNT GROUPS SEPTEMBER 30, 2000 (Continued) Governmental Fund Types Special Debt Capital LIABILITIES, EQUITY AND OTHER CREDITS General Revenue Service Projects Liabilities: Accounts payable and accrued liabilities $ 176,286 $ 1,665 $ 23 $ 217,379 Due to other funds — — 258 Due to other governments 7,862 — -- Deposits 4,340 — — — Deferred revenues 46,890 — 126,332 16,123 Bonds payable — — -- -- Notes payable — — -- -- Total liabilities 235,378 1,665 126,355 233,760 Equity and other credits: Investments in general fixed assets — — — — Contributed capital — — Retained earnings: Reserved for operations and maintenance — — — Reserved for renewal and replacement — — — — Reserved for debt service — — — Unreserved — -- — -- Fund balances: ^ Reserved for: Encumbrances 64,341 — -- 1,402,872 Debt service — — 171,853 -- Law enforcement — — — Employees' pension benefits — — — Unreserved: Designated for inventory 7,454 — — Designated for prepaid items 2,069 — — Designated for donations 21,970 Designated for emergencies 350,000 — — -- Designated for road paving — 693,701 Designated for cemetery care — -- -- Undesignated 2,404,759 456,461 — 868,598 Total equity and other credits 2,850,593 456,461 171,853 2,965,171 Total liabilities, equity and other credits $ 3,085,971 $ 458,126 $ 298,208 $ 3,198,931 w The accompanying notes to financial statements are an integral part of this financial statement. 7 w Exhibit 1 4 of 4 w Proprietary Fiduciary Totals Fund Fund (Memorandum Types Types Account Groups Only) General General Trust Fixed Long -Tenn Primary Enterprise and Agency Assets Obligations Government $ 81,271 $ 770 $ - $ 280,782 $ 758,176 - - - - 258 - - - 7,862 - 9,660 - - 14,000 70,777 - - - 260,122 1,480,483 - - 238,589 1,719,072 - -- - 2,946,113 2,946,113 1,632,531 10,430 - 3,465,484 5,705,603 - - 24,686,758 - 24,686,758 562,492 - - 562,492 _ 68,145 - 68,145 72,524 - 72,524 205,349 - - 205,349 680,527 - - 680,527 - - 1,467,213 - 171,853 - 6,401 - - 6,401 2,216,899 - -- 2,216,899 - - -- 7,454 - 2,069 21,970 - 350,000 - 693,701 399,469 -- 399,469 47,546 -- 3,777,364 1,589,037 2,670,315 24,686,758 -- 35,390,188 .� $ 3,221,568 $ 2,680,745 $ 24,686,758 $ 3,465,484 $ 41,095,791 M w Exhibit 2 1 of 2 CITY OF SEBASTIAN, FLORIDA COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES ALL GOVERNMENTAL FUND TYPES AND EXPENDABLE TRUST FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000 Governmental .. Special General Revenue .. Revenues: Taxes $ 4,018,521 $ — Licenses and permits 475,345 — Intergovernmental 1,471,122 2,254,549 Charges for services 159,701 — Fines 140,672 — .. Special assessments -- Contributions -- - Interest and other revenues 334,547 66,227 ., Total revenues 6,599,908 2,320,776 Expenditures: Current: ., General government 1,783,034 151,402 Public safety 2,129,662 — Public works 2,008,451 — Housing and community development -- 617 Debt Service: Principal 164,928 .. Interest — 135,072 Capital outlay — 192,785 Total expenditures 5,921,147 644,804 Excess (deficiency) of revenues over (under) expenditures 678,761 1,675,972 Other financing sources (uses): Operating transfers in 10,700 617 ., Operating transfers out (684,496) (1,438,097) Total other financing sources (uses) (673,796) (1,437,480) Excess (deficiency) of revenues and other financing sources over (under) expenditures and other financing uses before extraordinary items 4,965 238,492 Extraordinary item: _ FEMA/State/insurance proceeds - Hurricanes Floyd/Irene 102,560 — Total extraordinary item 102,560 — .. Excess (deficiency) of revenues and other financing sources over (under) expenditures, other financing uses and extraordinary items 107,525 238,492 Fund balances, October 1 2,743,068 217,969 Fund balances, September 30 $ 2,850,593 $ 456,461 The accompanying notes to financial statements are an integral part of this financial statement. 9 Exhibit 2 2 of 2 Fiduciary Fund Fund Types Types Totals Debt Capital Expendable (Memorandum Service Projects Trusts Only) $ - $ - $ - $ 4,018,521 - - 475,345 - 846,969 - 4,572,640 - - - 159,701 -- 140,672 128,154 - 128,154 -- -- 2,060 2,060 84,705 178,757 269,873 934,109 212,859 1,025,726 271,933 10,431,202 174 8,689 3,403 1,946,702 - - - 2,129,662 - 70,755 2,079,206 - - - 617 47,932 - - 212,860 16,464 - - 151,536 - 4,416,198 104,621 4,713,604 64,570 4,495,642 108,024 11,234,187 148,289 (3,469,916) 163,909 (802,985) - 1,983,193 140,000 2,134,510 - - (11,917) (2,134,510) - 1,983,193 128,083 - 148,289 (1,486,723) 291,992 (802,985) -- -- 102,560 - -- 102,560 148,289 (1,486,723) 291,992 (700,425) 23,564 4,451,894 161,424 7,597,919 $ 171,853 $ 2,965,171 $ 453,416 $ 6,897,494 10 Exhibit 3 1 of M CITY OF SEBASTIAN, FLORIDA COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL (BUDGETARY BASIS) GENERAL, SPECIAL REVENUE AND DEBT SERVICE FUNDS FOR THE YEAR ENDED SEPTEMBER 30, 2000 General Fund Actual on Variance Budgetary Favorable Budget Basis (Unfavorable) Revenues: Taxes $ 4,173,850 $ 4,018,521 S (155,329) S Licenses and permits 452,100 475,345 23,245 Intergovernmental 1,437,288 1,471,122 33,834 Charges for services 66,930 159,701 92,771 Fines 113,200 140,672 27,472 Special assessments - - -- Interest and other revenues 284,830 334,547 49,717 Total revenues 6,528,198 6,599,908 71,710 Expenditures: Current: General government 1,947,785 1,764,980 182,805 Public safety 2,185,798 2,102,428 83,370 Public works 1,996,145 1,919,940 76,205 Housing and community development - - - Debt Service: Principal -- - -- Interest - - -- Capital Outlay 208,917 198,140 10,777 Total expenditures 6,338,645 5,985,488 353,157 Excess of revenues over over expenditures 189,553 614,420 424,867 Other financing sources (uses) Operating transfers in 10,700 10,700 -- Operating transfers out (684,496) (684,496) -- Total other financing sources (uses) (673,796) (673,796) - Excess (deficiency) of revenues and other financing sources over (under) expenditures and other financing uses before extraordinary item (484,243) (59,376) 424,867 Extraordinary item: FEMA/State/insurance proceeds -Hurricanes Floyd/Irene 75,288 102,560 27,272 Total extraordinary item 75,288 102,560 27,272 Excess of revenues (expenditures) and other financing sources over (expenditures) revenues, other financing uses and Special Revenue Funds Actual on Variance Budgetary Favorable Budget Basis (Unfavorable) 2,178,447 2,254,549 76,102 43,000 66,227 23,227 2,221,447 2,320,776 99,329 154,051 151,402 2,649 617 617 -- 164,910 164,928 (18) 135,090 135,072 18 253,360 192,785 60,575 708,028 644,804 63,224 1,513,419 1,675,972 162,553 617 617 - (1,438,097) (1,438,097) (1,437,480) (1,437,480) - 75,939 238,492 162,553 extraordinary item (408,955) 43,184 452,139 75,939 238,492 162,553 Fund balance, October 1 2,743,068 2,743,068 -- 217,969 217,969 -- Fund balance, September 30 $ 2,334,113 $ 2,786,252 $ 452,139 $ 293,908 $ 456,461 $ 162,553 The accompanying notes to financial statements are an integral part of this financial statement. 11 W W1 r�. W M IWI W Exhibit 3 2 of n1 Debt Service Fund Totals (Memorandum Only) Actual on Variance Actual on Variance Budgetary Favorable Budgetary Favorable w Budget Basis (Unfavorable) Budget Basis (Unfavorable) $ - $ - $ - $ 4,173,850 $ 4,018,521 $ (155,329) No - - - 452,100 475,345 23,245 - - -- 3,615,735 3,725,671 109,936 - - -- 66,930 159,701 92,771 -- - - 113,200 140,672 27,472 108,563 128,154 19,591 108,563 128,154 19,591 78,000 84,705 6,705 405,830 485,479 79,649 186,563 212,859 26,296 8,936,208 9,133,543 197,335 306 174 132 2,102,142 1,916,556 185,586 -- - - 2,185,798 2,102,428 83,370 r• - - - 1,996,145 1,919,940 76,205 - - - 617 617 -- 47,932 47,932 -- 212,842 212,860 (18) 16,464 16,464 - 151,554 151,536 18 - - -- 462,277 390,925 71,352 64,702 64,570 132 7,111,375 6,694,862 416,513 121,861 148,289 26,428 1,824,833 2,438,681 613,848 on - -- - 11,317 11,317 -- -- - (2,122,593) (2,122,593) -- no -- - - (2,111,276) (2,111,276) -- m w 121,861 148,289 26,428 (286,443) 327,405 613,848 - - 75,288 102,560 27,272 -- - -- 75,288 102,560 27,272 121,861 148,289 26,428 (211,155) 429,965 641,120 23,564 23,564 -- 2,984,601 2,984,601 -- $ 145,425 $ 171,853 $ 26,428 $ 2,773,446 $ 3,414,566 $ 641,120 12 M Exhibit 4 CITY OF SEBASTIAN, FLORIDA COMBINED STATEMENT OF REVENUES, EXPENSES AND CHANGES IN EQUITY ALL PROPRIETARY FUND TYPES FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000 Revenues: Golf course fees Rents Other revenue Total revenues Operating expenses: Salaries, wages and employee benefits Contractual services, materials and supplies Depreciation Amortization Total operating expenses Operating income Nonoperating revenues (expenses): Grants, entitlements and shared revenues Interest income Interest expense Total nonoperating revenues (expenses) Net income before extraordinary item Extraordinary item: FEMA/State/insurance proceeds -Hurricane Floyd/Irene Total extraordinary item Net income Retained earnings, October 1 Prior period adjustment (see note K) Retained earnings as adjusted, October 1 Retained earnings, September 30 The accompanying notes to financial statements are an integral part of this financial statement. 13 Enterprise Fund Types $ 1,320,598 108,941 23,858 1,453,397 210,455 931,884 164,513 6,379 1,313,231 140,166 83,302 102,468 (96,980) 88,790 228,956 21,256 21,256 250,212 697,623 78,710 776,333 $ 1,026,545 W W W M Exhibit 5 1 of2 CITY OF SEBASTIAN COMBINED STATEMENT OF CASH FLOWS ALL PROPRIETARY FUND TYPES FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000 Enterprise Fund Types INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS Cash flows from operating activities: Cash received from customers $ 1,407,433 Cash payments to suppliers for goods and services (843,857) Cash payments for employee services (215,148) Other operating revenue 51,444 ., Net cash provided by operating activities 399,872 Cash flows from noncapital financing activities: FEMA/State/insurance proceeds -Hurricane Floyd/Irene 13,816 Net cash provided by noncapital financing activities 13,816 Cash flows from capital and related financing activities: Acquisition and construction of capital assets (271,663) Receipts from capital grants 25,875 Principal paid on revenue bond maturities (110,000) .� Interest paid on revenue bonds (96,980) Net cash used in capital and related financing activities (452,768) Cash flows from investing activities: Interest on investments 102,415 Net cash provided by investing activities 102,415 Net increase in cash and cash equivalents 63,335 Cash and cash equivalents at October 1 (*) 1,493,479 Cash and cash equivalents at September 30 $ 1,556,814 * Beginning balance restated to include equity in pooled investments. See cash and cash equivalents reconciliation. .. The accompanying notes to financial statements are an integral part of this financial statement. (Continued) 14 Exhibit 5 2 of 2 CITY OF SEBASTIAN COMBINED STATEMENT OF CASH FLOWS ALL PROPRIETARY FUND TYPES FOR THE YEAR ENDED SEPTEMBER 30, 2000 (Continued) Enterprise Fund Types RECONCILIATION OF OPERATING INCOME TO NET CASH PROVIDED BY OPERATING ACTIVITIES Operating income $ 0 Adjustments not affecting cash: Depreciation 0 Amortization 0 Changes in assets and liabilities: Decrease in accounts receivable 0 Decrease in prepaid expenses 0 Increase in inventories 5,145 Increase in accounts payable 30,012 Increase in compensated absences (3,756) Decrease in accrued wages and taxes 61,771 Increase in deferred revenue 922 Net cash provided by operating activities $ 94,094 Cash and cash equivalents reconciliation: Current assets: Equity in pooled investments $ 1,210,796 Restricted assets: Equity in pooled investments 346,018 Cash and cash equivalents at September 30 $ 1,556,814 The accompanying notes to financial statements are an integral part of this financial statement. 15 Exhibit 6 CITY OF SEBASTIAN, FLORIDA COMBINED STATEMENT OF CHANGES IN PLAN NET ASSETS ALL PENSION TRUST FUNDS ., FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000 no ADDITIONS Contributions Employer contributions Employee contributions State contributions Total contributions Investment income Net appreciation in fair value of investments Interest and dividends Less investment expenses Net investment income Total additions DEDUCTIONS Benefits Refunded contributions Other expenses Total deductions n Net increase Net assets held in trust for pension benefits, October 1, 1999 Net assets held in trust for pension benefits, September 30, 2000 ow E Pension Trust Fund 27,704 56,296 112,773 196,773 158,317 95,082 253,399 (17,880) 235,519 432,292 24,283 17,835 2,011 44,129 388,163 1,828,736 $ 2,216,899 The accompanying notes to financial statements are an integral part of this financial statement. 16 M CITY OF SEBASTIAN, FLORIDA Notes to the Financial Statements September 30, 2000 I. SUMMARY OF SIGNIFICANT ACCOUNT 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 approximately 16,500 living in an area of approximately 13.5 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 generally accepted accounting principles as applied to governmental units. The more significant of the City's accounting policies are described below: A. Reportina Entitv In evaluating the City as a reporting entity, management has included all component units in accordance with Governmental Accounting Standards Board Statement No. 14, "Defining the Financial Reporting Entity". The Financial Reporting Entity consists of the City of Sebastian (the primary government) and its component units. 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 and are reported as part of the primary government. M Blended Comuonent 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. The financial statements of these component units may be obtained from the City Clerk of the City of Sebastian. Community Redevelopment Agency (CPA) — The governing body of the CRA is the Sebastian City Council. The CRA was not funded in fiscal year 2000, therefore, there is no financial statement information blended in the primary governments financial statements. 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 Pension". B. Basis of Presentation The accounts of the City are organized on the basis of funds and account groups, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of self -balancing accounts that comprise its assets, liabilities, fund equity, revenue and expenditures or expenses, as appropriate. Governmental resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled. The various funds are grouped in the financial statements in this report into three broad categories, eight generic fund types, and two account groups as follows: Governmental Funds The focus of Governmental funds measurement is upon determination of financial position and changes in financial position (sources, uses and balances of financial resources rather than upon net income determination). Typically, only current assets and current liabilities are included on these balance sheets. These funds are maintained on the modified accrual basis of accounting. The following, on the next page, is a description of the governmental funds of the City: 17 ., General Fund This is the principal fund of the City and is used to account for all activities of the City not included in other specified funds. The General fund accounts for the normal recurring �. activities of the City (e.g. administration, public safety, public works, etc.). Special Revenue Funds These funds account for revenues from earmarked revenue sources which by law are designated to finance particular functions or activities of government. The Community Development Block Grant funds construction improvements. The Local Option Gas Tax funds provide for street improvements and maintenance. The Discretionary Sales Tax funds are used for infrastructure improvements and equipment purchases. Debt Service Fund This fund accounts for the payment of principal and interest on special obligation or revenue bonds for which debt service accounts are required, other than bonds payable from revenues of a governmental enterprise. The source of funding is principally from special assessments. The accumulation of funds for the following bond issue is accounted for in the debt service fund: Special Assessment Revenue Bond, Series 1996 Capital Proiects Funds These funds account for the City's capital projects which are funded from resources accounted for in the General Fund, Local Option Gas Tax Special Revenue fund, Discretionary Sales Tax Special Revenue fund, and loans for capital improvements. Capital facilities acquisitions and improvements financed by the Proprietary funds are financed in those funds. The City has four Capital Projects funds described as follows: Capital Proiects Fund Pumose .. General Capital Projects Capital improvements, such as the City Hall roof replacement, computers for police records management system, police in -car video systems which are mainly funded by the General fund, grants and other governmental and fiduciary funds. Capital Improvement Projects Infrastructure improvements funded by Discretionary Sales Tax and various grants. .� Transportation Improvements Street, bridge and transportation infrastructure improvements funded by local option gas tax, municipal gas taxes and discretionary sales tax. Road Paving Program Street resurfacing program funded by bank loan. �. Proprietary Funds The focus of Proprietary funds measurement is upon determination of financial position, net income and cash flows. The generally accepted accounting principles are those applicable to similar businesses in the private sector. These funds are maintained on the accrual basis of accounting. The following, on the next page, is a description of the Proprietary funds of the City: 18 W Enterorise Funds These funds are used to account for the operation, maintenance and acquisition of governmental facilities and services which are entirely or predominantly self -supported by user charges. The operation of Enterprise funds are accounted for in such a manner as to show a profit or loss similar to comparable private enterprises. The City has two Enterprise funds. They are: Enterorise Fund Purpose Golf Course Operates municipal golf course. .. Airport Operates general aviation airport. Fiduciary Funds .. Fiduciary funds include Expendable Trust funds, Pension Trust funds and Agency funds. The measurement focus of Expendable Trust funds is the same as Governmental funds. Expendable Trust funds are maintained _ on a modified accrual basis of accounting. The measurement focus of Pension Trust funds is similar to proprietary funds. Pension Trust funds are maintained on an accrual basis of accounting. Agency funds are custodial in nature (assets equal liabilities) and do not involve measurement of results of operations. Agency funds are maintained on a modified accrual basis of accounting. .� Pension Trust Fund This fund is used to account for assets held by the City in a fiduciary capacity for the Police Officers' Pension Plan. The funds are operated by carrying out specific terms of Florida statutes, ordinances, and other governing regulations. Expendable Trust Funds These funds account for assets maintained by the City in a trustee capacity pursuant to statutes, ordinances or requirements of donors. The City has six expendable trust funds. They are: .. Expendable Trust Fund Purpose Cemetery Trust Accounts for funds held in trust for the capital improvements, operation and maintenance of the cemetery. Law Enforcement Trust Accounts for confiscated money, vehicles, etc. for use in law enforcement activities. Law Enforcement Education Trust Accounts for 2nd dollar funds from traffic citations for use in police officer education. Public Safety Employees Benefit Trust Accounts for donations and vending machine revenues for use in Public Safety Employee relations and employee sponsored events. General Employees Benefit Trust Accounts for vending machine revenues and employee sponsored functions and events. Major Equipment Replacement Trust Accounts for funding of heavy duty equipment replacement purchases. _ Agency Funds These funds are used to account for assets held by the City as agent for individuals and businesses. The Performance Deposits fund accounts for deposits placed by bidders and developers to guarantee performance pursuant to bid or contract and for deposits for use of City owned buildings and parks to guarantee performance pursuant to contract. WR 19 Account Groups Account groups are not funds. They are used to establish accounting control and accountability for the City's General Fixed Assets and General Long -Term Debt. The following, on the next page, is a description of the City's Account Groups: General Fixed Asset Account GrouD This Account Group represents a summary of the fixed assets of the City other than fixed assets of the Proprietary funds. Capital outlay in funds other than Proprietary funds are recorded as expenditures of those funds at the time of purchase and are subsequently recorded, at cost, for control purposes in this Account Group. General Lone -Term Debt Account Grain) This Account Group is used to account for all the outstanding principal balances of special obligation bonds, notes payable, accrued compensated absences, and capital leases of the City, except obligations of Proprietary funds, as applicable. C. Basis of Accounting Basis of accounting refers to the point at which revenues and expenditures or expenses are recognized in the accounts and reported in the financial statements. Basis of accounting relates to the timing of the measurements made; regardless of the measurement focus applied. 1. Modified Accrual All Government funds, Expendable Trust funds and Agency funds are accounted for using the modified accrual basis of accounting. Revenues are recognized when they become measurable and available as net current assets. "Available" means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. All material revenues, except for occupational licenses and property taxes, are considered measurable and available and are thus susceptible to accrual. Occupational licenses are not considered available since neither a legally enforceable claim exists nor were the related �. services provided before October 1, 2000. Property tax revenues are recognized upon receipt from the Indian River County Tax Collector. (See Note III. E.). Expenditures are generally recognized under the modified accrual basis of accounting when the related fund liability is incurred. An exception to this ., general rule is principal and interest on general long-term obligations, which are recognized when due. 2. Accrual All Proprietary funds and the Pension Trust fund are accounted for using the accrual basis of accounting. .. Revenues are recognized when earned and expenses are recognized when incurred. D. Measurement Focus 1. Current Financial Resources All Government funds and Expendable Trust funds are accounted for on a spending or "flow of current financial resources" measurement focus. This means that only current assets and current liabilities are generally included on their balance sheets. Their reported fund balances (net current assets) is considered a measure of "available spendable resources." Their operating statements present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets. Accordingly, they are said to present a summary of sources and uses of "available spendable resources" during a period. 2. Economic Resources The Proprietary funds and Pension Trust fund are accounted for on a cost of services or "economic resources" measurement focus. This means that all assets and all liabilities, whether current or noncurrent, associated with their activity are included on their balance sheets. Their reported fund equities (net total assets) are segregated into contributed capital and retained earnings or net plan asset components. The operating statements of these funds present increases (revenues) and decreases (expenses) in net total _ assets. 20 M E. Accounting and Reoorting for Proprietary Funds Pursuant to Governmental Accounting Standards Board (GASB), Statement 20, Accounting and Financial ReDortIRg for Proorietary Funds and Other Governmental Entities That Use Prourietary Fund Accounting, the City applies all applicable GASB pronouncements, as well as, those Financial Accounting Standards Board (FASB) statements and interpretations, Accounting Principles Board (APB) Opinions, and Accounting Research Bulletins (ARB) issued on or before November 30, 1989 to its Proprietary funds unless those pronouncements conflict with or contradict GASB pronouncements. F. Budeetary Data 1. Budget Policv The City Council typically adopts an annual budget for the General fund, Special Revenue funds, and Debt Service fund. The City Council typically adopts budgets for projects in Capital Projects funds on a "life of the project" basis. All budgets are prepared on a modified accrual basis with encumbrance accounting. Budgetary control is legally maintained at the department level. Budget transfer authority is provided to the City Manager within departments in a fund as long as the total budget is not increased. The City Manager also has authority to make budget transfers between departments to implement Council approved actions. City Council action is required for the approval of a supplemental budget. Supplemental appropriations were made during the year and all budget amounts presented in the accompanying financial statements have been adjusted for legally authorized revisions of the annual budgets. All appropriations which were not expended, encumbered or committed lapse at year end. 2. Encumbrances 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 to the next years' budget and are reported as a reservation of fund balance in the current financial statements since they do not constitute actual expenditures or liabilities. Actual results of operations presented in accordance with 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 Note IL). G. Assets. Liabilities and Fund Ecuity 1. Pooled Cash Equity in pooled cash consists primarily of cash in banks. Investment earnings of the pooled cash account are allocated to the participating funds at the end of each month based on the ratio of each participating fund's investment to the total pooled investment. As of September 30, 2000, the funds participating in pooled cash investments are the General fund; all Special Revenue funds except the Community Development Block Grant fund; Debt Service fund; all Capital Projects funds except the Road Paving Program fund; all Enterprise funds; all Expendable Trust funds; and the Agency Fund. 2. Investments Investments are stated at fair value, based on the quoted market price, except for investments in the Local Government Surplus Funds Trust Fund administered by the Florida State Board of Administration. The State Board of Administration 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. In accordance with the regulations of 2a-7 like pools, the City's share of investments held at the State Board of Administration 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 the pool 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. 21 Pursuant to Florida Statutes, interest income earned on Local Option Gas Tax funds is required to be earmarked for transportation infrastructure improvements. Local Option Gas Tax funds held as investments in the Transportation Projects fund, which are part of an internal investment pool, are assigned and recorded in the Local Option Gas Tax Special Revenue Fund in accordance with these legal ., restrictions. 3. Inventory Inventory is valued at average cost. Inventory in the General fund consists of materials and supplies held for consumption. The cost is recorded as an expenditure at the time the individual inventory items are issued. Inventory in the Golf Course fund consists of supplies held for resale. 4. Fixed Assets Fixed assets in Governmental fund type operations (general fixed assets) are accounted for at historical cost, if purchased, and at fair market value at date of gift, if donated, in the General Fixed Assets Account Group, rather than in the Governmental funds. Public domain (infrastructure) general fixed assets, consisting of certain improvements including roads, bridges, curbs and gutters, streets and sidewalks, drainage systems and lighting systems are capitalized in the general fixed assets. No depreciation has been provided for assets accounted for in the General Fixed Assets Account Group. The proprietary funds record fixed assets at historical costs, if purchased, and at fair market value at date of gift, if donated. Major additions are capitalized while maintenance and repairs which do not improve or extend the life of the respective assets are charged to expense. Contributions received in aid of construction are credited to contributions accounts and do not reduce the cost of the assets acquired with such contributions. Depreciation is recognized on the straight-line method for the fixed assets of the Proprietary funds. The following average useful lives are used for depreciation purposes: Classification Ranee of Lives Buildings 20-40 years Improvements other than buildings 10-50 years Machinery, equipment and other 2-30 years Airport runways 25 years 5. Lone -Term Liabilities Long -Term liabilities expected to be financed from Governmental funds are accounted for in the General Long -Term Debt Account Group; not in the Governmental funds. Expenditure recognition for governmental fund types is limited to exclude amounts paid from noncurrent assets. Such long-term amounts are not recognized as governmental fund type expenditures or fund liabilities. They are instead reported as liabilities in the General Long -Term Debt Account Group. All liabilities (whether current or non -current) associated with the activity of the Enterprise funds and the Pension Trust fund are included on their respective balance sheets. In the Enterprise funds, bond issue costs and discount/premiums are deferred and amortized over the period of the bond issue using the bonds outstanding method which approximates the interest method. Unamortized bond discounts/premiums are presented as reductions/additions in the amount of the related bonds outstanding. Unamortized bond issue costs are presented as other assets. 22 6. Fund Equity The Combined Balance Sheet — All Fund Types and Account Groups report a number of Fund Balance or Retained Earnings reserves which are maintained for specific purposes. The nature and purpose of these reserves are explained as follows: Reserve for Debt Service — represents, in accordance with legal restrictions, amounts for payment of principal and interest maturing in later years. Reserved for Renewal and Replacement — represents, in accordance with legal restrictions, amounts required to be retained by the fund for capital repair and replacement. Reserve for Operations and Maintenance — represents, in accordance with legal and contractual restrictions, amounts required to be retained by the fund for operating and maintenance expenditures. Reserved for Encumbrances — represents encumbrances outstanding at year end which the City intends to honor as commitments. Reserved for Employees' Pension Benefits — represents, in accordance with legal and ., contractual restrictions, amounts for employee pensions. Reserved for Law Enforcement — represents, in accordance with State Statutes, funds required to be spent on drug education and awareness activities. Designations of unreserved fund balances are not required by law or accounting principles, but are further classifications of fund equity to identify funds which are earmarked for specific purposes. The Proprietary Funds' contributed capital represents equity acquired through capital grants and capital contributions from developers, customers and other funds. H. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. I. Memorandum Onlv Total Columns Total columns on the various combined statements are captioned "Memorandum Only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position, results of operation, or cash flows in conformity with generally accepted accounting principles. Such data is not comparable to consolidated financial information. hiterfund eliminations have not been made in the aggregation of this data. .. J. Comuarative Data/Reclassifications Comparative data for the prior year have been presented in selected sections of the accompanying financial statements in order to provide an understanding of the changes in the government's financial position and operations. Also, certain amounts presented in the prior year data have been reclassified in order to be consistent with the current year's presentation. ., K. Prior Period Adiustment The City implemented a Fixed Asset Management System in the current fiscal year. Prior fixed assets records were maintained in a spreadsheet format and depreciation was calculated annually. Following the implementation, actual depreciation was calculated and accumulated depreciation adjusted. Retained earnings at the beginning of the year for the Golf Course fund has been adjust to correct an error in calculated depreciation made in prior years. Had the error not been made, net income for prior years would have been increased by $78,710. 23 II. BUDGETARY COMPLIANCE The Combined Statement of Revenues, Expenditures and Changes in Fund Balances — All Governmental Fund Types and Expendable Trust Funds are prepared on a basis consistent with generally accepted accounting principles (GAAP) as described in Note I. Results of operations included in the Combined Statement of Revenues, .. Expenditures and Changes in Fund Balances — Budget and Actual (Budgetary Basis) — General, Special Revenue, and Debt Service Fund Types are prepared on a budgetary basis to conform with the Governmental Accounting Board's Codification of Governmental Accounting and Financial Renorting Standards, Section 2400. The accompanying Combined Statement of Revenues, Expenditures and Changes in Fund Balances — Budget and Actual (Budgetary Basis) — General, Special Revenue, and Debt Service Fund Types presents comparisons of the legally adopted budget with actual data on a budgetary basis. Since accounting principles applied for purposes of developing data on a budgetary basis differ significantly from those used to present financial statements in conformity with generally accepted accounting principles, a reconciliation of the resultant timing differences in the excess of revenues over expenditures and other financing sources (uses) (Budgetary Basis) as compared to the excess of revenues over expenditures and other financing (uses) (GAAP Basis) for the year ended September 30, 2000, is as follows: Special Revenue Debt Service General Fund Funds Fund Excess of revenues over expenses and other financing sources (uses) (Budgetary Basis) $ 43,184 $ 238,492 $ 148,289 Adjustments: To adjust for encumbrances 64.341 — — Excess of revenues over expenses and other financing sources (uses) (GAAP Basis) $ 107.525 6 238.412 $ 148289 The Legislative and City Clerk departments of the General fund had necessary expenditures which exceeded the budgets by $154, and $5,897, respectively. Capital Projects funds have budgets which are approved on a "life of the project basis". These budget periods are not consistent with the method of financial reporting; therefore, comparisons between the results of operations and budgets for these funds are not relevant and are not presented herein. M. DETAIL NOTES — ALL FUNDS AND ACCOUNT GROUPS .� A. Cash and Cash Eauivalents Cash and cash equivalents represents all investments which 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. The cash and cash equivalents presented on the Combined Statement of Cash Flows — All Proprietary Fund Types are composed of restricted and unrestricted cash and cash equivalents presented on the Combined Balance Sheet — All Fund Types and Account Groups. B. Deposits At September 30, 2000, the carrying amount of the City of Sebastian's deposits with banks was $87,562 and the bank balance was $87,562. 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.) Of the bank balance, no amount was uninsured or uncollateralized in banks or savings and loans not qualifying under the Act at September 30, 2000. The City maintains a pool of cash and investments in which each fund participates on a daily transaction basis. .,� Interest is distributed monthly based on actual end of month balances. 24 C. Investments Statutes, ordinances, and policies authorize the City to invest in the Local Government Surplus Trust Fund administered by the Florida State Board of Administration, direct obligations of the United States or agencies thereof, interest bearing time deposits or savings accounts, overnight repurchase agreements, mutual funds, stocks, and bonds. The City's investments are categorized to give an indication of the level of risk assumed by the entity at September 30, 2000. .. Category 1—Includes investments that are insured or registered or for which the securities are held by the City or its safekeeping agent in the City's name. Category 2—Includes investments that are uninsured or unregistered securities held by the pledging financial institution's trust department or agent in the City's name. Category 3—Includes investments that are uninsured or unregistered securities held by the pledging financial institution's Lust department or agent, but not in the City's name. Category 1 Category 2 Fair Value Primary Government Repurchase Agreements $ 684,906 $ — $ 684,906 U.S. Treasury Bonds 136,703 — 136,703 Common Stock 810,069 — 810,069 Corporate Bonds 30,038 30,038 _ Agency Notes — 1,975,824 1,975,824 Sub -total $ 1,661,716 $ 1,975,824 3,637,540 _ Local Government Surplus Funds Trust Fund 6,332,692 Money Market Funds 234,323 Total Primary Government Investments $ 10,204,555 The investments with the Local Government Surplus Funds Trust Funds and money market funds can not be classified within the categories described above, because they are not evidenced by securities that exist in physical or book entry form. These are investments in pools managed by the Florida State Board of Administration or mutual funds. D. Interfund Receivables and Pavables Transactions between funds that represent borrowing arrangements outstanding at the end of the fiscal year are referred to as Advances to/from Other Funds. All other outstanding balances between funds are reported as Due to/from Other Funds. Interfund receivables and payables of the Reporting Entity at September 30, 2000, are summarized as follows: Primary Government Transactions Due to Due from Road Paving Program Fund $ 258 $ .. General Fund 258 Totals $ — 258 $ 258 E. Prooerty 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, 2000, was 5.0000 mills. Current tax collections were approximately 94.3% of the total tax levy. 25 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 liened 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 budgeted and also become due and payable. F. 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, Capital Project, and Enterprise funds. A grant receivable is recorded when the City has a right to reimbursement 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 amount of grants received during fiscal year 2000 and recorded in the accompanying financial statements are ^ presented as follows: Primary Government Amount COPS Fast Grant $ 32,125 ^ Local Law Enforcement Block Grants 8,423 General Construction 463,994 Emergency Management 75,725 ^ Airport 25,875 Total Reporting Entity 42 ^ G. Due from Other Governmental Units Due from other governmental units represents amounts earned in the reporting year but not received until the following year. The amounts represent discretionary sales tax, local option gas taxes, funds due from Indian River County, Florida Department of Environmental Protection, Florida Emergency Management Services, Florida Department of Transportation, St. John's River Water Management District, and revenue sharing from the State of Florida. ^ H. Changes in General Fixed Assets and Property. Plant and Eouiument Changes in the City's General Fixed Assets and property, plant and equipment for Proprietary funds were as follows: Balance Balance October 1, September 30, .. Primary Government General Fixed Assets 1999 Additions Deletions 2000 Land $ 3,067,536 $ 690,109 $ 9,060 $ 3,748,585 Buildings and structures 2,317,483 122,052 -- 2,439,535 ^ Improvements other than buildings 10,877,451 4,023,245 -- 14,900,696 Machinery and equipment 3,295,342 565,421 385,441 3,475,322 Construction in process 570,049 48,861 496,290 122,620 _ Totals $ 20.127.861 $ 5.449.688 $ 890.791 $ 24.686.758 Balance Balance October 1, September 30, Proprietary Funds 1999 Additions Deletions 2000 Land $ 9,060 $ — $ -- $ 9,060 Buildings and structures 347,183 11,608 6,470 352.321 .� Improvements other than buildings 2,295,532 185,710 6,923 2,474,319 Machinery and equipment 503,988 70,672 39,945 534,715 Construction in process — 57,012 — 57,012 Totals 3.155.763 325.002 53.336 3.427A27 ^ Less: Accumulated depreciation 1,837,183 250,839 165,036 1,922,986 Net property, plant and equipment $ 1,318,580 $ 74,163 $ (111,698) $ 1,504,441 26 L Lone -term Oblieations 1. Chanees in General Lone -term Debt The following is a summary of changes in General Long -Term Debt of the City for the year ended September 30, 2000: Balance Balance October 1, September Oblieation 1999 Additions Deletions 2000 .. Compensated absences $ 301,063 $ - $ 20,281 $ 280,782 Revenue bond payable 286,521 - 47,932 238,589 Roadway improvement note payable 3,111,041 - 164,928 2,946,113 Totals $ 3,698,625 $ $ 233,141 $ 3,465,484 2. Debt Service Requirements to Maturitv ., The annual requirements to amortize all bonded debt outstanding as of September 30, 2000, including interest requirements, is as follows: .. PRINCIPAL Golf Course Revenue Roadway Revenue Bond Improvement Refunding Series Note Bonds 1996 Payable Series,1993 Total Year 5.75% 4.40% 6.25% Interest Total 2001 $ 50,688 $ 172,246 $ 115,000 $ 232,404 $ 570,338 2002 53,602 179,908 125,000 215,387 573,897 2003 56,684 187,911 125,000 197,177 566,772 2004 59,944 196,270 135,000 178,309 569,523 2005 17,671 205,000 140,000 158,166 520,837 2006-2010 - 1,170,178 860,000 498,261 2,528,439 2011-2014 834,600 - 65,431 900,031 Less unamortized bond discount - - (19,517) - (19,517) $ 238,589 $ 2,946,113 $ 1,480,483 $ 1,545,135 _ $ 6,210,320 3. Revenue Bonds Revenue bonds are secured by and payable from the revenues of the respective funds which issued them. 1. The City issued a ten (10) year, $527,993 Revenue Bond, Series 1996 for the purpose of financing the construction costs of a waterline along the riverfront. The principal and interest are paid from special assessments received on an annual basis. These funds are accumulated in the Debt Service fund. 2. The City entered into a fifteen (15) year loan agreement in 1998 with a local bank for $3,268,890 to provide financing to repave certain roads in the City. 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. 3. The City issued thirty (30) year, $2,245,000 Golf Course Revenue Refunding Bonds, Series 1992 for the purpose of refinancing the original bonds, funding a reserve account, and financing construction of certain capital improvements. The City has pledged Golf Course revenues, electric franchise fees and public utility taxes for repayment of principal and interest. 27 M on The resolutions applicable to the Golf Course Revenue Refunding Bonds require the establishment of various requirements for the reserve accounts applicable to the particular bond issue. These requirements have been met for the City as of September 30, 2000. The following schedule lists the amounts of retained earnings at September 30, 2000, that are reserved in accordance with the provisions of the Golf Course Revenue Refunding Bonds indenture. The reserved portion is equal to the restricted assets less restricted liabilities payable therefrom as follows: Primary Government Golf Course Reserved Retained Eamines 4. Compensated Absences The City accounts for compensated absences in conformity with Governmental Accounting Standards Board's Codification of Governmental Accountine and Financial Reportin2 Standards, Section C60. Vacation costs and sick leave costs are recognized as expenditures or expenses when earned by the employee. The following is a summary of the Reporting Entity's liability for compensated absences at September 30, 2000. Compensated Primary Government Absence PrODrietary Fund Tvoe Liabili Enterprise funds: Golf Course $ 3.234 Total Primary Government S 3.234 The General fund obligations for accumulated vested vacation, sick leave, and applicable benefits of $280,782 were recorded as a liability in the General Long -Term Debt Account Group. These amounts are .� not recorded as liabilities and related expenditures in the Governmental fund type funds because they are not expected to be liquidated in the next fiscal year with available spendable resources. The liability for accumulated, vested vacation, sick leave, and applicable benefits of the Proprietary funds are recorded in the applicable funds as accounts payable and accrued expenses. J. Lease Commitments .. 1. The City is obligated under certain leases accounted for as operating leases. Operating leases do not give rise to property rights or lease obligations, and, therefore, the results of the lease agreements are not reflected in the City's account groups. 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, 2000: Golf Course Year endine September 30. to: Airport Golf Carts 2001 $ 120,000 $ 44,163 2002 120,000 52,250 2003 120,000 52,250 _ 2004 120,000 99,388 2005 120,000 -- Later years 2,125,000 Totals 2. The airport is the lessor of various properties. On the following page is a schedule by year of minimum future rental income on noncancelable operating leases: 28 Year ending September 30, Amount ., 2001 $ 148,459 2002 148,459 2003 148,459 2004 148,459 2005 148,459 Later years 2,621,931 Total minimum future rentals $3 3 ¢¢ IC Police Pension Plan Plan Description. The Police Officers' Pension Plan is a Florida Statute Chapter 185 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. Pension plan data is provided from an actuarial report dated September 30, 1999. 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. Employee membership data as of the latest actuarial data available related to the plan is as follows: Police Pension Plan 1999 Retirees and beneficiaries currently receiving benefits 2 Terminated employees entitled to refund of employee contribution _ but not yet received i Fully, partially, and non -vested active plan participants 28 Total 31 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 governs all benefit provisions of the plan, as amended. 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. Funding Policy. The employer, employee, and State contribution requirements are applicable to the Plan and actuarially determined on a bi-annual basis in accordance with Florida State Statute. Administration costs of the pension plan are financed by the plan. The employee contribution rate, expressed as a percentage of compensation, was 5.0% for the 1999-2000 fiscal year. The employer contribution rate, expressed as a percentage of compensation, was 2.41/6 for 1999-2000 fiscal year. A tax is levied on property and casualty insurance premiums and collected by the State which partially funds the Plan. The City is required to contribute the remaining amounts to ensure that the Plan is actuarially sound. .. The City's annual contributions equaled the annual pension cost for the Police Officers' Pension Plan for the year ended September 30, 2000. The City's contribution to the plan was $132,857. Required trend information for the Police Officers' Pension Plan was as follows: Amount Annual Pension Cost (APC) 1998 $102,215 1999 $104,474 2000 $132,857 Percentage of APC contributed 1998 100.00% 1999 100.00% 2000 100.00% K9 M Since the employer contribution equaled the annual pension costs, there is not a net pension obligation for the ^ plan. The annual required contribution for the Police Officers' Pension Plan was determined as part of the September 30, 1999, actuarial valuation using the aggregate actuarial cost method. The actuarial assumptions ^ included (a) 8.0% rate of return (net of administrative costs) and (b) projected salary increases of 7.5% per year. There is no unfunded actuarial accrued liability as of September 30, 2000. ^ 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 (excluding mutual funds and those issued or guaranteed by the U.S. government) held by the local pension plan did not exceed five percent of the total plan assets. ^ L. Contributed Capital Contributed capital represents contributions from governments and other sources. Contributed capital at September 30, 2000, is as follows: Balance Balance October 1, September 30, ^ Contributions by Source 1999 Additions Deletions 2000 Enterprise Funds: Airport $530,895 $ 31,597 $ - $ 562,492 ^ Total $ 530�8 M. Interfund Transactions There are two types of interfund transactions and transfers that are reported as interfund items between the funds. Quasi -external interfund transfers treat revenues, expenditures or expenses as if the transactions were occurring outside the government. Interfund transactions which constitute reimbursements of a fund for expenditures or expenses initially made from that fund and which are properly applicable to another fund are �. recorded as expenditures or expense in the reimbursing fund. Nonrecurring or nonroutine transfers of equity between funds are treated as residual equity transfers and are reported as additions to or deductions from fund balance, or in the case of a Proprietary fund, to contributed capital and retained earnings. All other transfers are treated as operating transfers and are included in the results of operations for both Governmental and Proprietary fund statements. Interfund transfers at September 30, 2000, are summarized as follows: Ooeratina Transfers Transfers In Transfers Out All Governmental funds and Expendable Trust funds $ 2.134.510 $ 2.134.510 No 30 W IV. SEGMENT INFORMATION - ENTERPRISE FUNDS ^ Segment information for the Enterprise funds at September 30, 2000, and for the year then ended is as follows: Golf ^ Course Airport Totals Operating revenues $ 1,367,405 $ 85,992 $ 1,453,397 Depreciation and amortization 115,675 55,217 170,892 �. Operating income (loss) 246,970 (106,804) 140,166 Net income (loss) 254,328 (4,116) 250,212 Net working capital 717,146 338,212 1,055,358 Property, plant and equipment: ^ Additions 246,061 78,941 325,002 Deletions 13,937 39,399 53,336 Current year capital contributions — 31,597 31,597 Total assets 2,122,018 1,099,550 3,221,568 Long-term obligations 1,365,483 — 1,365,483 ^ Total equity 541,934 1,047,103 1,589,037 V. COMMITMENTS AND CONTINGENCIES A. Construction Commitments The following by fund is the Reporting Entity's significant construction commitments at September 30, 2000: Primary Government Amount Capital Projects funds B. Litiagation The City is named as defendants in various lawsuits. The outcome of the lawsuits is not determinable at this time. It is the opinion of counsel that the resolution of these matters will not have a material adverse effect on the financial condition of the City. VI. SUBSEQUENT EVENTS A. Police Car Purchase On October 11, 2000, the City Council authorized purchase of seven police vehicles for $168,108. ^ B. Florida Inland Navieation District Aereement On October 25, 2000, the City Council authorized the execution of an agreement with the Florida hiland Navigation District for Boat Mooring, Shoreline Restoration, Site Work and Landscape Improvements in the amount of $170,000. C. Vehicle Purchases Through December 31, 2000, City Council approved the vehicle replacement purchases in the amount of $156,440. ^ D. Golf Course Renovation On December 20, 2000, the City Council awarded a contract in the amount of $587,000 to reconstruct eighteen ^ greens on the City Golf Course. 31 W REOUIRED SUPPLEMENTARY INFORMATION 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 is presented in the following schedules: CITY OF SEBASTIAN POLICE OFFICERS' PENSION PLAN SCHEDULE OF FUNDING PROGRESS LAST SIX FISCAL YEARS Actuarial Accrued UAAL as Actuarial Liability Unfunded a % of Actuarial Value of (AAL) AAL Funded Covered Covered Valuation Assets - Entry Age (UAAL) Ration Payroll Payroll Date (a) (b) (c) (a/b) (c) -a /c Not required, per paragraph 124 of statement number 25, for plans utilizing the aggregate actuarial cost method. .� CITY OF SEBASTIAN SCHEDULE OF CONTRIBUTIONS FROM THE EMPLOYER AND OTHER CONTRIBUTING ENTITIES LAST SIX FISCAL YEARS Annual Fiscal Required City State Percentage Year Contributions Contribution Contribution Contributed 2000 $ 132,857 $ 27,704 $ 112,773 100.00% an 1999 104,474 103,547 46,790 100.00% 1998 102,215 96,039 39,753 100.00% 1997 121,571 90,798 36,089 100.00% 1996 108,037 97,488 32,503 100.00% 1995 107,869 94,881 26,385 100.00% r! W 32 REOUIRED SUPPLEMENTARY INFORMATION M The information presented in the required supplementary schedules was determined as part of the actuarial evaluation at the date indicated. Additional information as of the latest actuarial valuation is as follows: M Contribution rates as of 9/30/98 City 6.5% Plan Members 5.0% Annual pension cost $ 62,462 .. Contributions made $ 96,039 Valuation date 9/30/98 Actuarial cost method Aggregate Amortization method N/A Remaining amortization period N/A Actuarial return assumptions Investment rate of return 8.00/0 Projected salary increase* 7.5% * Includes inflation at 3.0% Post Retirement COLA None 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 1, 1987, through the transition date, October 1, 1997. Thus, the .. NPO on October 1, 1997, is 0. The development of the Net Pension Obligation to date is as follows: 9/30/97 9/30/98 Actuarially Determined Contribution (A) $ — $ 62,462 Interest on NPO — Adjustment to (A) — — Annual Pension Cost — 62,462 Contributions made — 96,039 Increase in NPO — (33,577) NPO beginning of year — — NPO end of year $ -- $ (33,577) 33 - General Fund The General Fund is the principal fund of the City and is used to account for all activities of the City not included in other specified funds. The General fund accounts for the normal recurring activities of the City (e.g. administration, public safety, public works, etc.). 34 w m HOME OF PELICAN ISLAND THIS PAGE INTENTIONALLY LEFT BLANK 35 A-1 ,* CITY OF SEBASTIAN, FLORIDA GENERAL FUND COMPARATIVE BALANCE SHEETS SEPTEMBER 30, 2000 AND 1999 2000 1999 Assets Cash and cash equivalents $ 79,673 $ 33,267 � m Equity pooled investments 2,613,856 2,824,620 Accounts receivable, net 188,208 102,369 Due from other funds 258 2,979 _ Due from other governments 194,453 83,438 Inventory 7,454 12,214 Prepaid items 2,069 3,346 _ Total assets $ 3,085,971 $ 3,062,233 Liabilities and fimd balance Liabilities Accounts payable and accrued liabilities $ 176,286 $ 268,365 Due to other governments 7,862 -- Deposits 4,340 5,840 Deferred revenues 46,890 44,960 Total liabilities 235,378 319,165 Fund balance iO Reserved for encumbrances 64,341 43,113 Unreserved Designated for inventory 7,454 12,214 Designated for prepaid items 2,069 3,346 Designated for donations 21,970 5,278 Designated for emergencies 350,000 350,000 Undesignated 2,404,759 2,329,117 Total fund balance 2,850,593 2,743,068 Total liabilities and fund balance $ 3,085,971 $ 3,062,233 36 .o A-2 t of 2 CITY OF SEBASTIAN, FLORIDA GENERALFUND COMPARATIVE STATEMENTS OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES FOR THE FISCAL YEARS ENDED SEPTEMBER 30, 2000 AND 1999 �. 2000 1999 .. Revenues: Taxes $ 4,018,521 $ 3,800,242 Licenses and permits 475,345 448,928 .� Intergovernmental 1,471,122 1,371,522 Charges for services 159,701 33,097 Fines 140,672 89,697 �. Interest and other revenues 334,547 244,207 Total revenues 6,599,908 5,987,693 Expenditures: Current: General government: Legislative 28,923 17,364 City manager 183,989 154,385 City clerk 263,099 236,750 City attorney 88,829 81,447 Face 261,015 278,863 !. Human resources 129,209 94,120 Growth management 227,495 223,576 Building department 271,570 251,630 Miscellaneous 328,905 346,016 Total general government expenditures 1,783,034 1,684,151 Public safety: Public safety 2,129,662 2,122,823 Total public safety expenditures 2,129,662 2,122,823 Public works: Administration and engineering 177,093 262,324 Roads and drainage 963,720 885,506 Central garage 146,598 139,167 Building maintenance 168,751 150,216 Parks and recreation 457,176 391,664 Cemetery 95,113 80,038 Total public works expenditures 2,008,451 1,908,915 Total current expenditures 5,921,147 5,715,889 37 ON A-2 2of2 w M 2000 1999 Expenditures (continued): Debt service: Principal 31,871 Interest 279 Total debt service expenditures -- 32,150 Excess of revenues over expenditures 678,761 239,654 .� Other financing sources (uses) Operating transfers in 10,700 274,025 Operating transfers out (684,496) (414,959) _ Total other financing sources (uses) (673,796) (140,934) Excess of revenues and other financing sources over expenditures and other financing uses before extraordinary item 4,965 98,720 Extraordinary item FEMA/State/insurance proceeds - Hurricanes Floyd/Irene 102,560 — .� Total extraordinary item 102,560 — Excess of revenues and other financing sources over expenditures, other financing uses and extraordinary item 107,525 98,720 Fund balances, October 1 2,743,068 6,772,142 _ Residual equity transfers out — (4,127,794) Fund balances, September 30 $ 2,850,593 $ 2,743,068 Note: Capital outlay reported separately on Exhibit 2 is included in each function and activity for comparison purposes. M M A-3 1 of2 CITY OF SEBASTIAN, FLORIDA GENERAL FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL (BUDGETARY BASIS) GENERAL FUND FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000 Actual on Variance Budgetary Favorable Budget Basis (Unfavorable) Revenues: Taxes $ 4,173,850 $ 4,018,521 $ (155,329) Licenses and permits 452,100 475,345 23,245 Intergovernmental 1,437,288 1,471,122 33,834 Charges for services 66,930 159,701 92,771 Fines 113,200 140,672 27,472 Interest 203,000 196,704 (6,296) Otherrevenues 81,830 137,843 56,013 Total revenues 6,528,198 6,599,908 71,710 Expenditures: Current: General government: Legislative 28,769 28,923 (154) City manager 184,039 183,989 50 City clerk 266,247 272,144 (5,897) City attorney 103,919 88,829 15,090 Finance 279,623 262,410 17,213 Human resources 167,592 129,209 38,383 Growth management 239,331 227,495 11,836 Building department 278,628 271,570 7,058 Miscellaneous 461,544 355,716 105,828 Total general government expenditures 2,009,692 1,820,285 189,407 Public safety: Public safety 2,228,070 2,144,662 83,408 Total public safety expenditures 2,228,070 2,144,662 83,408 Public works: Administration and engineering 179,420 177,093 2,327 Roads and drainage 1,015,828 972,045 43,783 Central garage 152,676 147,068 5,608 Building maintenance 185,144 168,751 16,393 Parks and recreation 472,245 460,471 11,774 Cemetery 95,570 95,113 457 Total public works expenditures 2,100,883 2,020,541 80,342 Total current expenditures 6,338,645 5,985,488 353,157 Excess of revenues over expenditures 189,553 614,420 424,967 39 A-3 2 of 2 M M Other financing sources (uses) Operating transfers in Operating transfers out Total other financing sources (uses) Excess (deficiency) of revenues and other financing sources over (under) expenditures and other financing uses before extraordinary item Extraordinary item: FEMA/State/insurance proceeds - Hurricanes Floyd/Irene No Total extraordinary item Excess (deficiency) of revenues and other financing sources over (under) expenditures, other financing uses and extraordinary item Fund balances, October 1 .� Fund balances, September 30 M Actual on Variance Budgetary Favorable Budget Basis (Unfavorable) 10,700 10,700 — (684,496) (684,496) — (673,796) (673,796) — (484,243) (59,376) 424,867 75,288 102,560 27,272 75,288 102,560 27,272 (408,955) 43,184 452,139 2,743,068 2,743,068 — $ 2,334,113 $ 2,786,252 $ 452,139 Note: Capital outlay reported separately on Exhibit 3 is included in each function and activity for comparison purposes. 40 CITY OF HOME OF PELICAN ISLAND THIS PAGE INTENTIONALLY LEFT BLANK 41 SPECIAL REVENUE FUNDS Special Revenue Funds are used to account for revenues from earmarked sources which by law are designated to finance particular functions or activities of government and which, therefore, can not be diverted to other uses. The following activities of the City are reported in this section: ➢ Community Development Block Grant ➢ Local Option Gas Tax ➢ Discretionary Sales Surtax 42 [:a CITY OF SEBASTIAN, FLORIDA ALL SPECIAL REVENUE FUNDS COMBINING BALANCE SHEET SEPTEMBER 30, 2000 Community Development Local Option Discretionary Block Grant Gas Tax Sales Tax Totals ASSETS Cash and cash equivalents $ — $ 7,889 $ — $ 7,889 Equity in pooled investments — 97,846 83,948 181,794 Interest receivable 40 154 194 Due from other governments — 43,924 224,325 268,249 Total assets $ -- $ 149,699 $ 308,427 $ 458,126 LIABILITIES AND FUND BALANCES Liabilities: Accounts payable and accrued expenditures $ — $ 527 $ 1,138 $ 1,665 Total liabilities — 527 1,138 1,665 Fund balances: Unreserved, undesignated — 149,172 307,289 456,461 Total fund balances 149,172 307,289 456,461 Total liabilities and fund balances $ $ 149,699 $ 308,427 $ 458,126 43 Im CITY OF SEBASTIAN, FLORIDA _ ALL SPECIAL REVENUE FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000 Community Development Local Option Discretionary Block Grant Gas Tax Sales Tax Totals Revenues: Intergovernmental $ — $ 549,800 $ 1,704,749 $ 2,254,549 Interest and other revenues 14,818 51,409 66,227 Total revenues 564,618 1,756,158 2,320,776 Expenditures: Current: General government 151,402 -- 151,402 Housing and community development: Operating 617 — — 617 Debt Service: Principal 164,928 — 164,928 .� Interest 135,072 -- 135,072 Capital outlay 6,600 186,185 192,785 Total expenditures 617 458,002 186,185 644,804 .� Excess (deficiency) of revenues over (under) expenditures (617) 106,616 1,569,973 1,675,972 Other financing sources (uses): Operating transfers in 617 — — 617 Operating transfers out (4,028) (1,434,069) (1,438,097) Total other financing sources (uses) 617 (4,028) (1,434,069) (1,437,480) .. Excess of revenues over expenditures and other financing sources (uses) -- 102,588 135,904 238,492 Fund balances, October 1 46,584 171,385 217,969 Fund balances, September 30 $ $ 149,172 $ 307,289 $ 456,461 .n IM CITY OF SEBASTIAN, FLORIDA COMMUNITY DEVELOPMENT BLOCK GRANT SPECIAL REVENUE FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE BUDGET TO ACTUAL (BUDGETARY BASIS) FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000 Revenue: Intergovernmental Total revenue Expenditures: Current: Housing and community development: Operating Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures Other financing sources: Operating transfers in Total other financing sources Excess (deficiency) of revenues over (under) expenditures and other financing sources Fund balance, October 1 Fund balance, September 30 Actual on Variance Budgetary Favorable Budget Basis (Unfavorable) 617 617 617 617 — (617) (617) — 617 617 — 617 617 — ^ m CITY OF SEBASTIAN, FLORIDA ^ LOCAL OPTION GAS TAX SPECIAL REVENUE FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET TO ACTUAL (BUDGETARY BASIS) FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000 ^ Actual on Variance ^ Budgetary Favorable Budget Basis (Unfavorable) ^ Revenues: Intergovernmental $ 497,667 $ 549,800 $ 52,133 Interest and other revenues 11,000 14,818 3,818 ^ Total revenues 508,667 564,618 55,951 Expenditures: Current: Operating 154,051 151,402 2,649 ^ Debt service: Principal 164,910 164,928 (18) Interest 135,090 135,072 18 ^ Capital outlay 6,649 6,600 49 Total expenditures 460,700 458,002 2,698 ^ Excess of revenues over expenditures 47,967 106,616 58,649 Other financing uses: Operating transfers out (4,028) (4,028) -- _ Total other financing uses (4,028) (4,028) - ^ Excess of revenues over expenditures and other financing uses 43,939 102,588 58,649 ^ Fund balance, October 1 46,584 46,584 - .n Fund balance, September 30 $ 90,523 $ 149,172 $ 58,649 .M Im CITY OF SEBASTIAN, FLORIDA DISCRETIONARY SALES SURTAX SPECIAL REVENUE FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE - BUDGET TO ACTUAL (BUDGETARY BASIS) FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000 Actual on Variance Budgetary Favorable Budget Basis (Unfavorable) Revenues: Intergovernmental $ 1,680,780 $ 1,704,749 $ 23,969 Interest income 32,000 51,409 19,409 Total revenues 1,712,780 1,756,158 43,378 Expenditures .. Current: Operating — — _ Debt service: Principal Interest — Capital outlay 246,711 186,185 60,526 Total expenditures 246,711 186,185 60,526 Excess of revenues over expenditures 1,466,069 1,569,973 103,904 Other financing uses: Operating transfers out (1,434,069) (1,434,069) -- Total other financing uses (1,434,069) (1,434,069) — Excess of revenues over expenditures and other financing sources 32,000 135,904 103,904 Fund balance, October 1 171,385 171,385 — Fund balance, September 30 $ 203,385 $ 307,289 $ 103,904 47 CAPITAL PROJECTS FUNDS The Capital Projects Funds account for all resources used for the acquisition and/or construction of capital facilities by the City, except those financed by Enterprise Funds and certain Fiduciary Funds. The following activities are reported in this section: ➢ General Capital Projects ➢ Capital Improvement Projects ➢ Transportation Improvements ➢ Road Paving Program 48 I al CITY OF SEBASTIAN ALL CAPITAL PROJECTS FUNDS COMBINING BALANCE SHEET SEPTEMBER 30, 2000 Capital Road General Improvement Transportation Paving _ Capital Projects Projects Improvements Program Totals ASSETS Equity in pooled investments $ 237,890 $ 881,164 $ 90,759 $ -- $ 1,209,813 Investments -- - -- 1,807,826 1,807,826 Accounts receivable, net 11,912 -- 11,912 Due from other governments 169,380 169,380 Total assets $ 237,890 $ 1,062,456 $ 90,759 $ 1,807,826 $ 3,198,931 LIABILITIES AND FUND BALANCES Liabilities: Accounts payable $ 39,248 $ 71,857 $ $ 106,274 $ 217,379 Due to other fiords -- -- - 258 258 Deferred revenue - 16,123 - 16,123 r. Total liabilities 39,248 87,980 - 106,532 233,760 Fund balances: Reserved for encumbrances 3,750 385,949 5,580 1,007,593 1,402,872 Designated fund balances -- -- -- 693,701 693,701 Unreserved, undesignated 194,892 588,527 85,179 - 868,598 Total fund balances 198,642 974,476 90,759 1,701,294 2,965,171 Total liabilities and fund balances $ 237,890 $ 1,062,456 $ 90,759 $ 1,807,826 $ 3,198,931 r. 49 ^ C-2 ^ CITY OF SEBASTIAN ALL CAPITAL PROJECTS FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND ^ CHANGES IN FUND BALANCES FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000 ^ Capital Road General Improvement Transportation Paving Capital Projects Projects Improvements Program Totals ^ Revenues: Intergovernmental $ 18,423 $ 815,196 $ 4,350 $ 9,000 $ 846,969 Interest and other revenues 1,500 17,107 - 160,150 178,757 ^ Total revenues 19,923 832,303 4,350 169,150 1,025,726 Expenditures: ^ Current: General government 8,689 - - -- 8,689 Public works - 66,366 4,308 81 70,755 Capital outlay: ^ General government 44,458 39,293 - - 83,751 Public works 324 1,583,399 265,826 1,568,839 3,418,388 Parks - 885,234 - - 885,234 ^ Public safety 21,325 7,500 - - 28,825 Total expenditures 74,796 2,581,792 270,134 1,568,920 4,495,642 Deficiency of revenue under expenditures (54,873) (1,749,489) (265,784) (1,399,770) (3,469,916) ^ Other financing sources Operating transfers in 251,217 1,616,303 115,673 - 1,983,193 Total other financing sources 251,217 1,616,303 115,673 - 1,983,193 ^ Excess (deficiency) of revenue over (under) expenditures and other financing sources 196,344 (133,186) (150,111) (1,399,770) (1,486,723) ^ Fund balances, October 1 2,298 1,107,662 240,870 3,101,064 4,451,894 ^ Fund balances, September 30 $ 198,642 $ 974,476 $ 90,759 $ 1,701,294 $ 2,965,171 W M ^ 50 ^ HOME OF PELICAN ISLAND THIS PAGE INTENTIONALLY LEFT BLANK 51 - ENTERPRISE FUNDS Enterprise Funds are used to account for the acquisition, operation and maintenance of governmental facilities and services which are entirely or predominantly self -supported by user charges. The operations of Enterprise Funds are accounted for in such a manner as to show profit or loss similar to comparable private enterprises. The following activities of the City are reported in this section: ➢ Golf Course ➢ Airport 52 D-I CITY OF SEBASTIAN, FLORIDA ALL ENTERPRISE FUNDS COMBINING BALANCE SHEET SEPTEMBER 30, 2000 ASSETS Current assets: Equity in pooled investments Due from other governmental units Accounts receivable Interest receivable Inventory Prepaid expenses Total current assets Restricted assets Investments Total restricted assets Property, plant and equipment: Land Buildings Improvements other than buildings Machinery and equipment Construction in process Less accumulated depreciation Net property, plant and equipment Other assets Unamortized bond issue costs Total other assets Total assets LIABILITIES AND FUND EQUITY Current liabilities: Accounts payable and accrued liabilities Deferred revenues Current portion of long-term bonds payable Total current liabilities Noncurrent liabilities: Revenue bonds payable, net of Unamortized discount of $19,517 Total liabilities Fund equity: Contributed capital Retained earnings: Reserved for operations and maintenance Reserved for renewal and replacement Reserved for debt service Unreserved Total retained earnings Total liabilities and fund equity Golf Course Airport Fund Fund Totals $ 911,238 $ 299,558 $ 1,210,796 7,440 89,024 96,464 248 - 248 38 15 53 10,945 -- 10,945 1,838 2,062 3,900 931,747 390,659 1,322,406 346,018 -- 346,018 346,018 -- 346,018 -- 9,060 9,060 352,320 -- 352,320 1,620,772 853,546 2,474,318 492,339 42,378 534,717 56,966 46 57,012 (1,726,847) (196,139) (1,922,986) 795,550 708,891 1,504,441 48,703 - 48,703 48,703 -- 48,703 $ 2,122,018 $ 1,099,550 $ 3,221,568 $ 29,804 $ 51,467 $ 81,271 69,797 980 70,777 115,000 - 115,000 214,601 52,447 267,048 1,365,483 -- 1,365,483 1,580,084 52,447 1,632,531 - 562,492 562,492 PW I WM PR ON r• 68,145 - 68,145 72,524 72,524 205,349 -- 205,349 195,916 484,611 680,527 541,934 484,611 1,026,545 $ 2,122,018 $ 1,099,550 $ 3,221,568 r. 53 I- D-2 we CITY OF SEBASTIAN, FLORIDA ALL ENTERPRISE FUNDS .� COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN RETAINED EARNINGS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000 Golf Course Airport Fund Fund Totals Revenues: Golf course fees $ 1,320,598 $ - $ 1,320,598 .� Rents 27,586 81,355 108,941 Other revenue 19,221 4,637 23,858 Total revenue 1,367,405 85,992 1,453,397 Operating expenses: Salaries, wages and employee benefits 203,060 7,395 210,455 Contractual services, materials and supplies 801,700 130,184 931,884 Depreciation 109,296 55,217 164,513 on Amortization 6,379 - 6,379 Total operating expenses 1,120,435 192,796 1,313,231 Operating income (loss) 246,970 (106,804) 140,166 Nonoperating revenues (expenses): r� Grants, entitlements and shared revenues - 83,302 83,302 Interest income 83,082 19,386 102,468 Interest expense (96,980) - (96,980) Total nonoperating revenues (expenses) (13,898) 102,688 88,790 Net income (loss) before extraordinary item 233,072 (4,116) 228,956 Extraordinary item: .� FEMA/State/insurance proceeds -Hurricane Floyd/Irene 21,256 - 21,256 Total extraordinary item 21,256 21,256 Net income (loss) 254,328 (4,116) 250,212 Retained earnings, October 1 208,896 488,727 697,623 Prior period adjustment (see note K) 78,710 78,710 Retained earnings as adjusted, October 1 287,606 488,727 776,333 _ Retained earnings, September 30 $ 541,934 $ 484,611 $ 1,026,545 54 ., D-3 1 of2 CITY OF SEBASTIAN, FLORIDA ALL ENTERPRISE FUNDS COMBINING STATEMENT OF CASH FLOWS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000 Golf Course Airport Fund Fund Totals INCREASE IN CASH AND CASH EQUIVALENTS Cash flows from operating activities: Cash received from customers $ 1,323,825 $ 83,608 $ 1,407,433 Cash payments to suppliers for goods and services (762,925) (80,932) (843, 857) _ Cash payments for employee services (205,930) (9,218) (215,148) Other operating revenue 46,807 4,637 51,444 Net cash provided (used) by operating activities 401,777 (1,905) 399,872 Cash flows from nonoperating capital financing activities: FEMA/State/insurance proceeds -Hurricane Floyd/Irene 13,816 — 13,816 Net cash provided by nonoperating capital financing activities 13,816 — 13,816 Cash flows from capital and related financing activities: Acquisition and construction of capital assets q p (232,121) (39,542) (271,663) Receipts from capital grants — 25,875 25,875 Principal paid on revenue bond maturities (110,000) — (110,000) Interest paid on revenue bonds (96,980) — (96,980) Net cash used in capital and related financing activities (439,101) (13,667) (452,768) �w Cash flows from investing activities: Interest on investments 83,044 19,371 102,415 Net cash provided by investing activities 83,044 19,371 102,415 Net increase in cash and cash equivalents 59,536 3,799 63,335 Cash and cash equivalents at October 1 (*) 1,197,720 295,759 1,493,479 Cash and cash equivalents at September 30 $ 1,257,256 $ 299,558 $ 1,556,814 * Beginning balance restated to include equity in pooled investments. See cash and cash equivalents reconciliation. 55 M D-3 2 of 2 CITY OF SEBASTIAN, FLORIDA ALL ENTERPRISE FUNDS COMBINING STATEMENT OF CASH FLOWS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000 (Continued) Golf Course Airport Fund Fund Totals RECONCILIATION OF OPERATING INCOME (LOSS) TO NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES Operating income (loss) $ 246,970 $ (106,804) $ 140,166 Adjustments not affecting cash: Depreciation 109,296 55,217 164,513 Amortization 6,379 — 6,379 Changes in assets and liabilities: Decrease in accounts receivable 3,872 1,273 5,145 Decrease (increase) in prepaid expenses 32,074 (2,062) 30,012 Increase in inventories (3,756) -- (3,756) Increase in accounts payable 10,457 51,314 61,771 Increase in compensated absences 922 -- 922 Decrease in accrued wages and taxes (3,792) (1,823) (5,615) Increase (decrease) in deferred revenues (645) 980 335 Net cash provided (used) by operating activities $ 401,777 $ (1,905) $ 399,872 M Cash and cash equivalents reconciliation Current assets: ., Equity in pooled investments $ 911,238 $ 299,558 $ 1,210,796 Restricted assets: Equity in pooled investments 346,018 -- 346,018 Cash and cash equivalents at September 30 $ 1,257,256 $ 299,558 $ 1,556,814 04 56 W CITY OF b HOME OF PELICAN ISLAND THIS PAGE INTENTIONALLY LEFT BLANK 57 TRUST AND AGENCY FUNDS The Trust and Agency Funds are used to account for assets held by the City in a fiduciary capacity for individuals, governmental entities and others. Such Funds are operated by carrying out specific terms of trust indentures, statutes, ordinances or other governing regulations. The following activities of the City are reported in this section: Pension Trust Fund ➢ Police Officers' Pension Expendable Trust Funds ➢ Cemetery Trust ➢ Law Enforcement Trust ➢ Law Enforcement Education Trust ➢ Public Safety Employee Benefit Trust ➢ General Employees Benefit Trust ➢ Major Equipment Replacement Trust Fund Agency Funds _ ➢ Performance Deposits 58 E-1 1 of 2 ASSETS Equity in pooled investments Investments Receivable -employee contributions Interest receivable Total assets LIABILITIES AND FUND BALANCES Liabilities: Accounts payable and accrued liabilities Refundable deposits Total liabilities Fund balances: Reserved for: Law enforcement Employees' pension benefits Unreserved: Designated for cemetery care Undesignated Total fund balances Total liabilities and fund balances ., CITY OF SEBASTIAN, FLORIDA ALL FIDUCIARY FUNDS COMBINING BALANCE SHEET SEPTEMBER 30, 2000 Police Pension Trust Fund Expendable Law Police Law Enforcement Officers' Cemetery Enforcement Education Pension Trust Trust Trust $ -- $ 399,476 S 2,131 S 4,274 2,198,757 — -- -- 2,212 — -- -- 15,930 11 1 2 $ 2,216,899 $ 399,487 S 2,132 $ 4,276 $ — $ 18 $ 2 $ 5 — 18 2 5 — 2,130 4,271 �. 2,216,899 -- -- -- - 399,469 — 2,216,899 399,469 2,130 4,271 $ 2,216,899 $ 399,487 $ 2,132 $ 4,276 59 PM E-1 2 of 2 Trust Funds Agency Fund Public Safety General Major Employee Employees Equipment Benefit Benefit Replacement Performance Trust Trust Fund Deposits Totals $ 1,571 $ 5,510 40,857 $ 10,010 $ 463,829 -- -- -- -- 2,198,757 -- -- 2,212 1 2 -- -- 15,947 $ 1,572 $ 5,512 $ 40,857 $ 10,010 $ 2,680,745 $ 72 $ 323 $ 72 323 $ 350 $ 770 9,660 9,660 10,010 10,430 6,401 2,216,899 _ -- -- -- 399,469 1,500 5,189 40,857 47,546 1,500 5,189 40,857 -- 2,670,315 $ 1,572 $ 5,512 $ 40,857 $ 10,010 $ 2,680,745 60 E-2 CITY OF SEBASTIAN, FLORIDA ALL EXPENDABLE TRUST FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000 Law Major Law Enforcement Public Safety General Equipment u. Cemetery Enforcement Education Employees Employee Replacement Trust Trust Trust Trust Trust Trust Totals Revenues: Contributions $ - $ -- $ -- $ 379 $ 1,681 $ - $ 2,060 Interest income 18,991 144 216 97 233 5,478 25,159 Other revenues 34,800 2,417 4,734 231 1,032 -- 43,214 Gain on sale of assets 201,500 -- -- - -- 201,500 Total revenues 255,291 2,561 4,950 707 2,946 5,478 271,933 Expenditures: Current: General government 250 920 912 615 706 - 3,403 Capital outlay - - 104,621 104,621 Total expenditures 250 920 912 615 706 104,621 108,024 Excess (deficiency) of revenues over (under) expenditures 255,041 1,641 4,038 92 2,240 (99,143) 163,909 Other financing sources (uses): Operating transfers in - -- _ -- 140,000 140,000 Operating transfers out (8,700) (1,217) (2,000) -- (11,917) Total other financing sources (uses) (8,700) (1,217) (2,000) - 140,000 128,083 Excess of revenues over expenditures and other financing sources (uses) 246,341 424 2,038 92 2,240 40,857 291,992 .. Fund balances, October 1 153,128 1,706 2,233 1,408 2,949 -- 161,424 Fund balances, September30 $ 399,469 $ 2,130 $ 4,271 $ 1,500 $ 5,189 $ 40,857 $ 453,416 PW 61 E-3 CITY OF SEBASTIAN, FLORIDA PERFORMANCE DEPOSITS FUND STATEMENT OF CHANGES IN ASSETS AND LIABILITIES FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000 �+ Performance Deposits Fund ASSETS Equity in pooled investments $ Total assets $ LIABILITIES Balance Balance Beginning End of of Year Additions Deductions Year 350 $ 59,810 $ 50,150 $ 10,010 350 $ 59,810 $ 50,150 $ 10,010 Accounts payable $ — $ 50,223 $ 49,873 $ 350 Refundable deposits 350 59,837 50,527 9,660 Total liabilities $ 350 $ 110,060 $ 100,400 $ 10,010 so 62 CITY OF HOME OF PELICAN ISLAND THIS PAGE INTENTIONALLY LEFT BLANK 63 GENERAL FIXED ASSETS ACCOUNT GROUP The General Fixed Assets Account Group represents a summary of the fixed assets of the City, other than assets of the Enterprise Funds. Capital outlay in funds other than Enterprise Funds are recorded as expenditures of those funds at the time of purchase and are subsequently recorded, at cost, for control purposes in the General Fixed Assets Account Group. In accordance with generally accepted accounting principles for municipalities, depreciation is not recorded on general fixed assets. 64 F-1 CITY OF SEBASTIAN, FLORIDA SCHEDULE OF GENERAL FIXED ASSETS - BY SOURCES SEPTEMBER 30, 2000 GENERAL FIXED ASSETS Land Buildings and structures Improvements other than buildings Machinery and equipment Construction in progress Total general fixed assets INVESTMENT IN GENERAL FIXED ASSETS FROM Federal grants State grants County grants General fund Law enforcement trust fund Cemetery trust fund Donations Sales taxes Contribution from Proprietary funds Total investment in general fixed assets $ 3,748,585 2,439,535 14,900,696 3,475,322 122,620 $ 24,686,758 $ 750,161 474,471 405,783 11,804,531 33,579 119,962 6,213,578 4,840,602 44,091 $ 24,686,758 65 M F-2 CITY OF SEBASTIAN, FLORIDA SCHEDULE OF GENERAL FIXED ASSETS BY FUNCTION AND ACTIVITY SEPTEMBER 30, 2000 Improvements Machinery Otherthan and Function and Activity Land Buildings Buildings Equipment Totals rn General government: Legislative S S - $ $ 13,157 $ 13,157 City manager - 45,523 45,523 City clerk - 74,916 74,916 City attorney 2,471 2,471 Finance 110,793 110,793 Human resources - -- - 6,370 6,370 Growth management 84,426 60,801 145,227 Building department 77,926 77,926 Total general government 84,426 391,957 476,383 Public safety: on Police administration 9,560 816,941 1,002,565 1,829,066 Police road patrol 16,076 16,076 Code enforcement 18,554 18,554 W Police investigations -- -- -- 16,611 16,611 Police communications - -- -- 4,951 4,951 go Total public safety 9,560 816,941 1,058,757 1,885,258 Public works: Engineering 84,426 138,053 222,479 Building maintenance 33,971 20,236 103,784 157,991 Central garage 71,663 75,121 146,784 Parks and recreation 1,274,101 587,941 534,845 489,731 2,886,618 .� Roads and drainage -- 83,003 14,365,851 1,125,368 15,574,222 Cemetery 272,090 61,466 89,860 423,416 Total public works 1,580,162 908,735 14,900,696 2,021,917 19,411,510 Non -departmental 2,158,863 629,433 2,691 2,790,987 Total non -departmental 2,158,863 629,433 2,691 2,790,987 Total general fixed assets allocated to functions $ 3,748,585 $ 2,439,535 $ 14,900,696 $ 3,475,322 24,564,138 Construction in progress 122,620 Total general fixed assets S 24,686,758 66 M F-3 r CITY OF SEBASTIAN, FLORIDA SCHEDULE OF CHANGES IN GENERAL FIXED ASSETS BY FUNCTION AND ACTIVITY FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000 General Fixed General Fixed Assets Assets Function and Activity 10/01/99 Additions Deletions 09/30/00 General government: Legislative $ 7,808 $ 5,349 $ $ 13,157 City manager 31,519 18,500 4,496 45,523 City clerk 91,434 1,930 18,448 74,916 City attorney 4,585 599 2,713 2,471 Finance 173,667 5,029 67,903 110,793 Human resources 8,558 1,796 3,984 6,370 .� Growth management 224,817 3,330 82,920 145,227 Building department 79,902 25,542 27,518 77,926 Total general government 622,290 62,075 207,982 476,383 Public safety: Police administration 1,749,412 219,606 139,952 1,829,066 .. Police road patrol 16,076 16,076 Code enforcement 18,554 18,554 Police investigations 16,611 16,611 .. Police communications -- 4,951 - 4,951 Total public safety 1,749,412 275,798 139,952 1,885,258 _ Public works: Engineering 206,158 39,080 22,759 222,479 Building maintenance 110,804 51,773 4,586 157,991 Central garage 144,100 24,360 21,676 146,784 Parks and recreation 1,681,839 1,204,779 2,886,618 Roads and drainage 11,874,081 3,767,848 67,707 15,574,222 Cemetery 413,305 14,788 4,677 423,416 Total public works 14,430,287 5,102,628 121,405 19,411,510 Non -departmental 2,755,823 44,224 9,060 2,790,987 Total non -departmental 2,755,823 44,224 9,060 2,790,987 .. Total general fixed assets allocated to functions 19,557,812 5,484,725 478,399 24,564,138 .. Construction in progress 570,049 48,861 496,290 122,620 Total general fixed assets $ 20,127,861 $ 5,533,586 $ 974,689 $ 24,686,758 Total additions and deletions on this schedule include transfers between functions and activities. 5v GENERAL LONG-TERM DEBT ACCOUNT GROUP The General Long -Term Debt Account Group represents a summary of the general and special obligation debt of the City. Additional debt is outstanding in the Enterprise Funds of the City. 6s _Y clryof 4 � 4 0ME OF ISLAND THIS PAGE INT EAI AI,LYLEFTE,LANK 69 G-1 CITY OF SEBASTIAN, FLORIDA GENERAL LONG-TERM DEBT ACCOUNT GROUP SCHEDULE OF GENERAL LONG-TERM OBLIGATIONS SEPTEMBER 30, 2000 Public Paving Improvement Note Compensated Bonds Payable Absences Totals AMOUNTS AVAILABLE AND TO BE PROVIDED FOR THE RETIREMENT OF GENERAL LONG- TERM OBLIGATIONS Amount available for debt service $ 171,866 $ — $ $ 171,866 Amount to be provided for retirement of general long-term obligations 66,723 2,946,113 280,782 3,293,618 Totals $ 238,589 $ 2,946,113 $ 280,782 $ 3,465,484 GENERAL LONG-TERM OBLIGATIONS PAYABLE Compensated absences $ $ — $ 280,782 $ 280,782 Roadway improvement note -payable — 2,946,113 — 2,946,113 Revenue bond payable 238,589 — — 238,589 Totals $ 238,589 $ 2,946,113 $ 280,782 $ 3,465,484 70 CITY OF i HOME OF PELICAN ISLAND THIS PAGE INTENTIONALLY LEFT BLANK 71 STATISTICAL SECTION The Statistical Schedules differ statement presentations because data for more than one fiscal year . 72 TABLE I I of 2 CITY OF SEBASTIAN, FLORIDA GENERAL GOVERNMENTAL EXPENDITURES & OTHER FINANCING USES BY FUNCTION LAST TEN FISCAL YEARS t Fiscal General Public Public Debt Year Government Safety Works Service 1991 $ 1,012;129 $ 1,505,871 $ 1,171,374 $ 13,657 1992 1,056;166 1,653,001 1,164,894 124,497 1993 1,147,930 1,650,850 1,413,134 136,422 1994 1,271,768 1,785,073 1,677,206 133,008 1995 1,856,873 1,585,901 1,454,962 133,008 1996 2,651,408 1,627,955 1,442,598 255,297 1997 1,944,080 . 1,706,546 1,543,487 214,175 1998 1,439,181 1,842,266 2,006,966 211,956 1999 1,816,090 2,122,823 1,908,915 386,183 (3) (3) 2000 1,934,610 2,129,662 2,008,451 364,396 _ (1) This schedule lists expenditures of the General, Special Revenue, and Debt Service funds only. (2) Represents Operating Transfers Out to Capital Projects Funds (3) Code Enforcement Division previously reported under General Government, but is now reported under Public Safety (4) S 73 TABLE 1 2of2 Capital Other Operating Outlay Expenditures Transfers Out Total() $ 659,447 $ -- $ - $ 4,362,478 2,106,007 -- - 6,104,565 842,747 - 5,191,083 442,474 - -- 5,309,529 609,079 -- 5,639,823 1,124,542 -- 7,101,800 1,331,130 -- 6,739,427 2,628,671 -- 259 8,129,299 (4) (2) 191,226 4,830 1,852,679 8,282,746 (4) (2) 192,785 617 2,122,593 8,753,114 74 w TABLE 2 1 of2 CITY OF SEBASTIAN, FLORIDA GENERAL GOVERNMENTAL REVENUES & OTHER FINANCING SOURCES LAST TEN FISCAL YEARS w w Licenses Fiscal and Inter- Charges for Year Taxes Permits Governmental Services 1991 $ 3,195,204 $ 265,769 $ 756,113 $ 19,926 1992 3,648,151 257,032 710,286 8,717 w 1993 3,901,663 287,660 782,896 92,611 1994 4,230,835 347,786 934,210 166,095 w 1995 4,486,685 278,618 961,887 82,653 1996 4,931,996 321,149 1,166,881 74,657 w 1997 5,250,861 345,463 1,332,676 84,051 1998 5,612,313 388,936 1,366,428 51,196 1999 3,800,242 t3' 448,928 3,600,474 131 33,097 w 2000 4,018,521 475,345 3,725,671 159,701 w (1) This schedule lists expenditures of the General, Special Revenue, and Debt Service funds only. w (2) No Special Assessments for these years. (3) Local Option Gas Tax and Discretionary Sales Tax previously classified as taxes. The City does not collect these taxes, but receives them from the State. Therefore, they are not included in Taxes. (4) Capital Projects and additional Special Revenue Funds established in Fiscal Year 1999 resulting in Operating Transfers In. w 75 w Fines $ 50,250 54,304 59,640 57,257 67,774 82,477 59,198 71,194 89,697 140,672 Interest and Other Revenues $ 348,619 232,409 347,715 205,169 441,312 417,495 461,249 510,007 314,910 485,479 Special Assessments $ (2) (2) (2) (2) 174,060 135,336 68,474 30,522 44,964 128,154 76 Operating Transfers In 278,855 (41 11,317 TABLE2 2 of 2 Total") $ 4,635,881 4,910,899 5,472,185 5,941,352 6,492,989 7,129,991 7,601,972 8,030,596 8,611,167 9,144,860 TABLE3 1 of 2 CITY OF SEBASTIAN, FLORIDA PROPERTY TAX LEVIES AND COLLECTIONS LAST TEN FISCAL YEARS .. Percent of Current Tax Fiscal Total Tax Current Tax Collections .. Year Levy Collections to Tax Levyttl 1991 $ 1,822,662 $ 1,755,315 96.3% 1992 2,044,809 2,054,356 100.5% 1993 2,143,544 1,934,066 90.2% 1994 2,452,523 2,245,731 91.6% 1995 2,510,166 2,294,209 91.4% 1996 2,667,313 2,463,039 92.3% _ 1997 2,727,083 2,513,627 92.2% 1998 2,909,597 2,679,819 92.1 % 1999 2,869,796 2,726,857 95.0% 2000 2,422,756 2,283,898 94.3% Source: Indian River County Property Appraiser and Tax Collector pa (1) Does not include penalties and interest on delinquent taxes. 1- (2) Information is not available. A A 77 n w no p" No ON on m w me TABLE 3 2of2 Percent of Delinquent Total Tax Tax Total Tax Collections Collections(l) Collections(l) to Tax Levy $ (2) $ 1,755,315 96.3% (2) 2,054,356 100.5% 188,575 2,122,641 99.0% 177,793 2,423,524 98.8% 167,181 2,461,390 98.1% 156,752 2,619,791 98.2% 150,526 2,664,153 97.7% 130,803 2,810,622 96.6% 2,912 2,729,769 95.1 % 35,050 2,318,948 95.7% w W TABLE 4 1 of 2 CITY OF SEBASTIAN, FLORIDA ASSESSED AND ESTIMATED ACTUAL VALUE OF PROPERTY"' LAST TEN FISCAL YEARS M M Real Property Personal Property Fiscal Assessed Estimated Assessed Estimated .. Year Value Actual Value Value Actual Value 1991 $ 405,034,030 $ 506,292,538 $ 21,267,387 $ 21,267,387 1992 424,634,950 530,793,688 24,344,005 24,344,005 1993 452,669,880 565,837,350 26,386,374 26,386,374 1994 484,794,820 605,993,525 25,954,533 25,954,533 1995 514,374,980 642,968,725 26,554,691 26,554,691 1996 531,461,580 664,326,975 24,774,960 24,774,960 1997 563,855,210 704,819,013 30,303,882 30,303,882 1998 587,811,960 734,764,950 31,210,876 31,210,876 1999 626,274,970 782,843,713 46,027,721 46,027,721 2000 656,619,860 820,774,825 42,216,162 41,533,985 Source: Indian River County Property Appraiser Lw (1) Total assessed value based on approximately 80 percent of estimated actual value ■. M 79 TABLE 4 2 of 2 Ratio of Total Exemptions Total Total Assessed Value Real Assessed Estimated To Total Estimated Property Value Actual Value Actual Value $ 109,375,010 $ 426,301,417 $ 527,559,925 80.8% 116,182,188 448,978,955 555,137,693 80.9% 123,618,185 479,056,254 592,223,724 80.9% 146,957,174 510,749,353 631,948,058 80.8% 154,362,555 540,929,671 669,523,416 80.8% 161,007,095 556,236,540 689,101,935 80.7% 172,478,432 594,159,092 735,122,895 80.8% 177,515,747 619,022,836 765,975,826 80.8% 187,751,454 672,302,691 828,871,434 81.1% 190,327,263 698,836,022 862,308,810 81.0% m TABLE 5 CITY OF SEBASTIAN, FLORIDA PRINCIPAL TAXPAYERS SEPTEMBER 30, 2000 Taxpayer Type of Business Wal-Mart Stores Inc. Retail Florida Power & Light Utility/Electric BellSouth Communications Utility/Telephone Turner, James T. MHP/Rentals Ruth Guest House, Inc. Retail Rentals Craig, Robert T. (TR) Retail Grace's Landing LTD Rentals Charter Communications Utility/Cable Winn Dixie Stores, Inc. Retail Seb. Inlet Marina & Trd. Co., Inc. Restaurant/Hotel 91 2000 Percentage of Assessed Total Assessed Valuation Valuation $ 10,417,427 1.49% 9,044,147 1.29% 8,298,850 1.19% 3,784,200 0.54% 2,675,070 0.38% 2,200,000 0.31% 1,967,541 0.28% 1,855,744 0.27% 1,664,469 0.24% 1,302,972 0.19% ., TABLE 6 CITY OF SEBASTIAN, FLORIDA PROPERTY TAX RATES ., DIRECT AND OVERLAPPING GOVERNMENTS LAST TEN FISCAL YEARS w City of Sebastian Indian River County School Board Debt Total Total Debt Total Fiscal Operating Service City County(l) Operating Service School Year Millage Millage Millage Millage Millage Millage Millage Other( ) 1991 6.5000 6.5000 6.77230 (3) (3) 8.32080 2.16825 1992 6.6320 6.6320 6.15160 (3) (3) 9.36170 1.91520 _ 1993 6.4410 6.4410 5.65490 (3) (3) 9.56260 2.72080 1994 6.9000 6.9000 5.77090 8.59060 1.25400 9.84460 2.58730 1995 6.9000 - 6.9000 5.95235 8.98330 1,21500 10.19830 2.26023 1996 6.9000 6.9000 5.92350 9.13800 1.21000 10.34800 2.74083 ., 1997 6.9000 6.9000 5.92330 9.15400 1.16500 10.31900 2.64544 1998 6.9000 6.9000 5.80800 9.00300 1.13700 10.14000 2.49690 1999 6.5000 6.5000 6.99230 8.61400 1.00000 9.61400 (3) 2000 5.0000 5.0000 6.78040 8.61400 1.00000 9.61400 1.52091 w w (1) Millage includes General Fund, M.S.T.U.s, Emergency Services District and Land Bonds. (2) All Special Taxing Districts. (3) Information not available. m TABLE 7 CITY OF SEBASTIAN, FLORIDA SPECIAL ASSESSMENTS BILLINGS AND COLLECTIONS LAST TEN FISCAL YEARS Special Special Fiscal Assessments Assessments Year Billings Collected(') .. 1991 (3) (3) 1992 (3) (3) 1993 (3) (3) 1994 (3) (3) 1995 (3) (3) 1996 $ 135,336 $ 306,760 1997 59,925 68,474 1998 58,454 71,251 1999 200,860 (2) 64,823 2000 214,686 (2) 128,230 (1) Assessments collected which exceed current assessments billed indicate prepayment of assessments or payment of delinquent assessments, including penalties. (2) Includes all annual assessments plus total assessments on defaults plus penalties and interest. (3) There were no special assessments during these years. .. RE M w Assessed valuations: CITY OF SEBASTIAN, FLORIDA COMPUTATION OF LEGAL DEBT MARGIN SEPTEMBER 30, 2000 Assessed value .,, Add back: exempt real property Total assessed value Legal debt margin: Debt limitation - 10 percent of total assessed value Debt applicable to limitation: Total bonded debt Less: Special assessment bonds Revenue bonds Amount available for repayment of general obligation bonds Total applicable to limitation .� Legal debt margin M $ 3,184,702 (238,589) TABLE 8 $ 466,292,597 190,327,263 $ 656,619,860 $ 65,661,986 2,946,113 $ 62,715,873 84 TABLE 9 TABLE 10 CITY OF SEBASTIAN, FLORIDA RATIO OF NET GENERAL OBLIGATION BONDED DEBT TO ASSESSED VALUE AND NET GENERAL OBLIGATION BONDED DEBT PER CAPITA The City of Sebastian has no general bonded debt. CITY OF SEBASTIAN, FLORIDA RATIO OF ANNUAL DEBT SERVICE EXPENDITURES FOR GENERAL OBLIGATION BONDED DEBT TO TOTAL GENERAL GOVERNMENT EXPENDITURES The City of Sebastian has no general bonded debt. fi CITY OF SEBASTIAN, FLORIDA COMPUTATION OF DIRECT AND OVERLAPPING BONDED DEBT GENERAL OBLIGATION BONDS SEPTEMBER 30,1999 w The City of Sebastian has no overlapping bonded debt or general bonded debt, w m w OR w m TABLE 11 No ., TABLE 12 CITY OF SEBASTIAN, FLORIDA REVENUE BOND COVERAGE GOLF COURSE BOND LAST TEN FISCAL YEARS. Net Revenue Fiscal Gross Operating Available for Debt Service Requirements Year Revenues(l) Expenses (2) Debt Service Principal Interest Total Coverage 1991 $ 1,187,071 $ 845,204 $ 341,867 $ 35,000 $ 174,896 $ 209,896 cap 1.63 1992 1,186,570 1,097,214 89,356 84,437 84,437 (4) 1.06 cs� 1993 1,133,014 981,310 151,704 80,000 126,655 206,655 0.73 tst 1994 1,178,875 891,881 286,994 80,000 123,855 203,855 t°1 IAA ts� 1995 1,139,795 788,449 351,346 85,000 120,655 205,655 t4> 1.71 (5) 1996 1,213,952 854,479 359,473 90,000 116,830 206,830 (4) 174 ts) 1997 1,356,609 884,286 472,323 95,000 112,600 207,600 (4) 2.28 cst 1998 1,351,368 926,174 425,194 100,000 107,850 207,850 (4) 2.05 tst 1999 1,414,976 982,772 432,204 105,000 102,650 207,650 (4) 2.08 ts1 2000 1,471,743 1,004,760 466,983 110,000 96,980 206,980 t4) 2.26 ts� Total revenues (including interest) and other non -operating revenues. Total operating expenses exclusive of depreciation and amortization Golf Course Bond, Series 1985. Golf Course Bond, Series 1985 refunded in 1992 with Series 1992 Required coverage is 1.0. m so M a" M w M 7 M M M TABLE 13 CITY OF SEBASTIAN, FLORIDA DEMOGRAPHIC STATISTICS LAST TEN FISCAL YEARS Fiscal School Unemployment Year Population(1) Enrollment(2) Rate(3) 1991 11,019 1,309 9.9% 1992 11,569 1,352 11.9% 1993 12,154 1,382 10.7% 1994 12,800 1,397 11.0% 1995 13,488 1,413 9A% 1996 13,967 1,313 9.5% 1997 14,470 1,324 8.4% 1998 15,115 1,410 8.1% 1999 15,707 1,383 8.6% 2000 16,471 (4) 1,342 9.5% Date Sources (1) Bureau of Economics & Business Research University of Florida (2) School District (3) State Department of Labor - for Indian River County (4) Estimate from preliminary census figures. W, TABLE 14 1 of 2 M CITY OF SEBASTIAN, FLORIDA PROPERTY VALUE, CONSTRUCTION AND BANK DEPOSITS LAST TEN FISCAL YEARS .� Property Value .. Fiscal Year Commercial Residential Exemptions Total 1991 $1,230,859 $19,167,401 $657,566 $21,055,826 .+ 1992 3,233,881 18,151,007 508,269 21,893,157 1993 943,738 19,612,746 627,412 21,183,896 1994 6,303,712 25,587,753 1,306,648 33,198,113 1995 141,544 19,538,885 996,617 20,677,046 1996 1,104,514 20,155,914 940,629 22,201,057 1997 3,626,024 24,918,675 2,027,739 30,572,438 1998 3,142,469 25,549,287 1,044,055 29,735,811 1999 4,177,601 27,941,640 1,150,494 33,269,735 2000 6,873,360 27,420,413 2,278,255 36,572,028 (1) Estimated assessed value from Table 4 (estimated at 80% of estimated actual value) (2) Source: City Building Department (3) Source: Federal Deposit Insurance Corporation and Federal Savings and Loan Insurance Corporation (4) Information not available * Valuation fees paid. PH M ON r TABLE 14 2of2 Commercial Residential Construction (2) Construction (2) Number of Number of Bank Units Value* Units Value* Deposits(3)* 3 $31,533 280 $180,660 $184,941 6 34,048 240 168,737 256,184 4 27,517 267 179,122 252,032 0 46,305 351 233,502 308,643 r 10 23,192 238 179,816 318,583 9 30,621 240 183,177 331,765 11 42,111 335 216,196 293,368 0 42,628 276 223,511 312,097 11 46,236 282 248,702 (4) r 9 53,368 283 253,218 157,103 M TABLE 15 r CITY OF SEBASTIAN, FLORIDA MISCELLANEOUS STATISTICS SEPTEMBER 30, 2000 ^, Date of Incorporation 1924 Form of Government Council/Manager Number of employees (excluding police and fire): 98 Classified 82 Exempt 16 ^ Area in Square Miles 13.5 Name of Government facilities and services: Miles of streets 140 Miles Number of street lights 3,319 Culture and Recreation: Community centers 2 Parks 10 Park acreage 196.47 Golf courses I ^ Swimming pools 0 Tennis courts 6 Police Protection: .� Number of stations I Number of police personnel and officers 56 Number of patrol units 33 Number of law violations: Physical arrests 738 Traffic violations 3,562 Parking violations 305 ^ Facilities and services not included in the reporting entity Fire Protection: .. Number of stations 2 Number of fire personnel and officers 6 Number of calls answered 1,443 Number of inspections conducted 43 Sewage System: Number of service connections 1,250 WaterSystem: .. Number of service connections 2,985 Number of fire hydrants 447 Education: Number of elementary schools 2 Number of elementary school instructors 76 Number of secondary schools ^ 2 Number of secondary school instructors 135 91 SINGLE AUDIT SECTION The Single Audit Section contains various independent auditor's reports and schedules as required by the Single Audit Act of 1996 for state and local governments that - receive federal assistance and as required by Chapter 216.349, Florida Statutes for local governments that receive - grants from State agencies. a 92 HOYMAN, DOBSON & COMPANY, P.A. CERTIFI FI) I'UB LIK A(:COVNTANTS 215 8aytree Drive, Suite 1, Melbourne, Florida 32940, 321-255-0088, Fox 32) ' W-8648, w .hoyman.corn Charles W Hayman, Jr Barbara J. Oswalt Thomas L Kirk �1 Karen E Kirkland Deborah A. Bradley DIRECTOR EMERITUS Roger W. Dobson Eugene K. Bjerning I. Report on Compliance and on Internal Control over Financial Reporting Based on an Audit of Financial Statements Performed in Accordance with Government Auditine Standards Honorable Mayor and Commissioners .. City of Sebastian Sebastian, Florida We have audited the general purpose financial statements of the City of Sebastian, Florida, as of and for the year ended September 30, 2000, and have issued our report thereon dated December 11, 2000. We conducted our audit in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditine Standards. issued by the Comptroller General of the United States. Compliance r, As part of obtaining reasonable assurance about whether the City of Sebastian, Florida's general purpose financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grants, 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 that are required to be reported under Government Auditine Standards. However, we noted an immaterial instance of noncompliance that we have reported to management of the City of Sebastian, Florida, in a separate letter on pages 102-103 dated December 11, 2000. W El .. - • American Institute of Certified Public Accountants • Florida Institute of Certified Public Accountants • SEC Practice Section of the A.I. C. PA. • CPAmerica International Honorable Mayor and Town Commission City of Sebastian, Florida Page Two Internal Control Over Financial Reporting In planning and performing our audit, we considered the City of Sebastian, Florida's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial statements and not to provide assurance on the internal control over financial reporting. Our consideration of the internal control over financial .. reporting would not necessarily disclose all matters in the internal control over financial reporting that might be material weaknesses. A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would be material in relation to the general purpose financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control over financial reporting and its operation that we consider to be material weaknesses. This report is intended solely for the information and use of the audit committee, management, others within the organization, City Council, federal and state awarding agencies and the Office of 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. 00, Hoyman, Dobson & Company, P.A. December 11, 2000 95 HOYMAN, DOBSON & COMPANY, P.A. CERTIFIED PUBLIC ACCOUNT AN I S A 215 Boytree Drive, Suite 1, Melbourne, Florida 32940,321-255-0088, Fax 321-259-8648, viwvv.hoyrran.com Charles W. Hayman, Jr. Barbara J. Osvtolt Thomas L. Kirk on Karen E. Kirkland Deborah A Bradley DIRECTOR EMERITUS Report on Compliance With Requirements Applicable Roger W.Dobson �I to Each Major Program and Internal Control Over Eugene K. Bjerning Compliance in Accordance With OMB Circular A-133 Honorable Mayor and Members of the City Council ., City of Sebastian, Florida Compliance We have audited the compliance of the City of Sebastian, Florida with the types of compliance requirements described in the U. S. Office of Management and Budeet (OMB) Circular A-133 Compliance Suoulement that are applicable to each of its major federal programs for the year ended September 30, 2000. The City of Sebastian, Florida's major federal programs are identified in the summary of auditor's 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 federal programs is the responsibility of the City of Sebastian, Florida's management. Our responsibility is to express an opinion on the City of Sebastian, Florida's compliance based on our audit. We conducted our audit of compliance in accordance with generally accepted auditing standards; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; OMB Circular A-133, Audits of States. Local Governments. and Non -Profit Organizations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material .. effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about the City of Sebastian, Florida'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 of Sebastian, Florida'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 federal programs for the year ended September 30, 2000. KO • American Institute of Certified Public Accountants • Florida Institute of Certified Public Accountants • SEC Practice Section of the A.I.C. P.A. • CPAmerico International ., Honorable Mayor and Members of the 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 requirements of laws, regulations, contracts and grants applicable to federal programs. In planning and performing our audit, we considered the City of Sebastian, Florida's internal control over compliance with requirements that could have a direct and material effect on a major federal program in order to determine our auditing procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over compliance in accordance with OMB Circular A-133. Our consideration of the internal control over compliance would not necessarily disclose all matters in the internal control that might be material weaknesses. A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that noncompliance with applicable requirements of laws, regulation, contracts and grants that would be material in relation to a major federal program being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control over compliance and its operation that we consider to be material weaknesses. This report is intended solely for the information and use of the audit committee, management, others within the organization, City Council, federal and state awarding agencies, and the Office of the Auditor General and is not intended to be and should not be used by anyone other than these specified parties. Hoyman, Dobson & Company, P. �+ December 11, 2000 97 THE CITY OF SEBASTIAN, FLORIDA SCHEDULE OF FINDINGS AND QUESTIONED COSTS (CONTINUED) ., FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000 SECTION I — SUMMARY OF AUDITOR'S RESULTS Financial Statements Type of Auditor's report issued: Internal control over financial reporting: Unqualified Material weakness(es) identified? yes X no Reportable conditions(s) identified not considered to be material weaknesses? Yes X none reported Noncompliance material to financial statements noted? Yes X no Federal Awards Internal Control over major programs: Material weakness(es) identified? Yes X no Reportable conditions(s) identified not considered To be material weaknesses? Yes X none reported Type of auditor's report issued on compliance For major programs: Unqualified Any audit findings disclosed that are required to be reported in accordance with Circular A-133, ., Section 510(a)? yes X no Identification of major programs: �+ CFDA Number(s) Name of Federal Program or Cluster 66A60 Department of Environmental Protection Dollar threshold used to distinguish Between Type A and Type B programs: $ 300,000 Auditee qualified as low -risk auditee? Yes X no SECTION H — FINANCIAL STATEMENT FINDINGS No matters were reported. SECTION III — FEDERAL AWARD FINDINGS AND QUESTIONED COSTS No matters were reported. M CITY OF SEBASTIAN, FLORIDA SCHEDULE OF FEDERAL AWARDS YEAR ENDED SEPTEMBER 30, 2000 Catalog of Federal Fed Federal Agency/ Domestic Grant Total State Pass -Through Grantor/ Assistance Grant Identification Award Program ProerarnTitle Grant Period Pero Number Amount ExnenditUreS .. U.S. DEPARTMENT OF ENVIRONMENTAL PROTECTION Pass through State of Florida, Department of Environmental Protection: Stormwater Management 7/22/98 - 11/22/01 66.460 WM708 $ 530,000 $ 223,858 TOTAL U.S. DEPARTMENT OF ENVIRONMENTAL PROTECTION 530,000 223,858 U.S. DEPARTMENT OF INTERIOR ^' Pass through State of Florida, Department of Community Affairs Emergency Management 09/22/99 - 03/22/01 83.544 00.RM-xx-10-40-02-032 65,266 65,266 Emergency Management 10/22/99 - 04/22/01 83.544 00-RM-aa-10-40-02-020 29,918 29,918 TOTAL U.S. DEPARTMENT OF INTERIOR 95,184 95,184 .. U.S. DEPARTMENT OF JUSTICE Direct Programs: Office of Justice Programs COPS Fast Grant 511196 - 11/30/01 16.580 95CFW0682 300,000 41,394 Total Direct Programs 300,000 4094 Pass through State of Florida, Local Law Enforcement Block Grant 1011/97 - 9130199 16.592 99-0-A2-10-40-02-125 10,000 10,000 Local Law Enforcement Block Grant 3/01/00 - 8/31/00 16.592 00-CJ-G3-10-40-02-137 8,423 8,423 Total U.S. Department of Justice 18,423 18,423 TOTAL U.S. DEPARTMENT OF JUSTICE 318,423 59,817 TOTAL FEDERAL FINANCIAL ASSISTANCE $ 943,607 $ 378,859 The accompanying notes are an integral part of this schedule. Note 1: Basis of Presentation The accompanying schedule of expenditures of federal awards includes federal grant activity of the City of Sebastian and is presented on the accrual basis of accounting. The information in this schedule is presented in accordance with the requirements of OMB Circular A-133, Audits of States, Local Governments, and Non -Profit Organizations. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the general purpose financial statements. 99 IIIIIIII HOYMAN, DOBSON & COMPANY, P.A. CERTIFIED PUBLIC ACCOUNTANTS .w 215 Boyfree Drive, Melbourne, Florida 32940, 321-255-0088, Fax 321-259-8648, w .hoymon.com Charles W Hoyman, k Barbara J. Oswalt Thomas 1. Kirk Karen E Kirkland Deborah A. Bradley DIRECTOR EMERITUS Roger Dobson Eugene K Bjerning Independent Auditor's Report on Examination Of Management's Assertion About Compliance With Specified Requirements Honorable Mayor and Members of City Council City of Sebastian ,. Sebastian, Florida We have examined management's assertion about the City of Sebastian, Florida's compliance with .� the allowable cost requirements established in the grant agreements) applicable to the State grants and aids appropriations identified on the Schedule of State Financial Assistance for the year ended September 30, 2000 included in the accompanying Management Assertion Report. Management is responsible for the City of Sebastian, Florida's compliance with those requirements. Our responsibility is to express an opinion on management's assertion about the City of Sebastian, Florida's compliance based on our examination. Our examination was made in accordance with standards established by the American Institute of Certified Public Accountants and, accordingly, included examining, on a test basis, evidence about the City of Sebastian, Florida's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our examination provides a reasonable basis for our opinion. Our examination does not provide a legal determination on the City of Sebastian, Florida's compliance with specified requirements. In our opinion, management's assertion that the City of Sebastian, Florida complied with the aforementioned requirements during the fiscal year ended September 30, 2000 is fairly stated, in all material respects. This report is intended solely for the information and use of the audit committee, management, others within the organization, City Council, federal and state awarding agencies, and the Office of the Auditor General and is not intended to be and should not be used by anyone other than these specified parties. Hoyman, Dobson & ompan� y, A. December 11, 2000 100 • American Institute of Certified Public Accountants • Florida Institute of Certified Public Accountants • SEC Practice Secfion of the A.LC.PA. • CPAmerico International MY OF HOME OF PELICAN ISLAND THIS PAGE INTENTIONALLY LEFT BLANK 101 MY OF SLOASTIM HOME OF PEUCAN ISLAND City of Sebastian 1225 MAIN STREET ❑ SEBASTIAN, FLORIDA 32958 TELEPHONE (561) 589-5330 ❑ FAX (561) 589-5570 - - - MANAGEMENT ASSERTION REPORT I, Terrence R. Moore, hereby assert that the City of Sebastian complied with the allowable cost requirements of the grants and aid appropriations identified on the Schedule of State — of Florida Financial Assistance during the year ended September 30, 2000. W L — Ce ence R. M re City Manager January 24, 2001 - - W - 102 PER CITY OF SEBASTIAN, FLORIDA SCHEDULE OF STATE OF FLORIDA FINANCIAL ASSISTANCE PER YEAR ENDED SEPTEMBER 30, 2000 MEN Federal State Agency Federal Through and State Contract/ CFDA State State Total _ Program Title Grant Number Number Receipts Receipts Receipts DEPARTMENT OF COMMUNITY AFFAIRS Bureau of Community Assistance Local Law Enforcement Block Grant 00-C1-G3-10-40-02-137 16.592 $ — $ 8,423 $ 8,423 Total Bureau of Community Assistance — 8,423 8,423 Emergency Management Division Emergency Management 00-RM-xx-10-40-02-032 83.544 10,460 (1) 65,266 75,726 Total Department of Community Affairs 10,460 73,689 84,149 DEPARTMENT OF ENVIRONMENTAL PROTECTION Stormwater Management WM708 66.460 -- 143,661 143,661 _ Florida Recreation Assistance Program F99136 91,240 (1) — 91,240 Florida Recreation Assistance Program F20065 100,000 (1) — 100,000 Florida Fish & Wildlife Conservation Commission FWC 00061 74,400 (1) — 74,400 Total Department of Environmental Protection 265,640 143,661 409,301 DEPARTMENT OF AGRICULTURAL & CONSERVATION SERVICES Urban & Community Forestry DCAS 96-15 548 — 548 Total Department of Agricultural & Conservation Services 548 — 548 DEPARTMENT OF TRANSPORTATION Joint Participation Agreement with Florida Department of Transportation Aviation Administration: Five Year Airport Master Plan 407176-1-94-01 25,875 (1) — 25,875 Total Department of Transportation 25,875 — 25,875 TOTAL STATE FINANCIAL ASSISTANCE $ 302,523 $ 217,350 $ 519,873 (1) State Grant and Aids Appropriations moneys. The total of State Grants and Aids Appropriations moneys is $301,975. PER 103 HOYMAN, DOBSON & COMPANY, P.A. CERTIFIED PUBLIC ACCOUNTANTS 215 Boytree Drive, Melbourne, Florida 32940, 321-255-0088, Fox 321-259-8648, www.hoymon.com Independent Auditor's Management Letter Comments Honorable Mayor and Members of City Council City of Sebastian Sebastian, Florida Charles W Hayman, Jc Barbara J. Oswalt Tnomas I. Kirk Karen E. Kirkland Deborah A. Bradley DIRECTOR EMERITUS Roger Dobson Eugene K. Blerning We have audited the general purpose financial statements of the City of Sebastian, Florida, as of September 30, 2000 and for the year then ended, and have issued our report thereon dated December 11, 2000. In planning and performing our audit, we considered the internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial statements and not to provide assurance on the internal control structure. During our audit, we became aware of certain matters concerning the internal control structure and/or compliance with laws and regulations. We submit the following comments and recommendations in accordance with the Rules of the Auditor General: M 1. Police Pension Finding: GASB Statement 27, which was implemented in fiscal year 1997, requires the Pension Board to have a biennial actuarial valuation. Currently, the City has an actuarial valuation done every three years. The last actuarial valuation obtained by the City was as of September 30, 1998. The City did not meet the requirement of GASB Statement 27 because they did not obtain an actuarial valuation at September 30, 2000. .. Recommendation: To ensure compliance with GASB Statement 27, the Pension Board will need to approve obtaining a biennial actuarial valuation. W 2. Compliance with Grant Requirements Finding: The City failed to provide evidence of its notification to the Florida Department of Environmental Protection of all subcontracts used in the Stormwater Management Project. Notification is required under Section XI of the Florida Department of Environmental Protection Contract No. WM708 for the purposes of approval by the Department. _ Recommendation: We recommend that the City retain a copy of the documentation it provides to the Florida Department of Environmental Protection requesting approval of subcontractors. The City should also request the Department provide a letter indicating the approval of the subcontracts. 104 •American Institute of Certified Public Accountants • Florida Institute of Certified Public Accountants • SEC Practice Section of the A.I.C-P..A. • CPAmerico International Honorable Mayor and Members of the City Council City of Sebastian, Florida .. Page Two In addition, we recommend the City appoint a staff member to monitor both the financial and non -financial requirements of grants to ensure full compliance. Status of Prior Year Audit Findings: .. The status of audit findings for the year ended September 30, 1999 are as follows: Manaeement Letter Status 1 Police Pension Repeated 2 Fixed Assets ., a) Determination of Obsolete or Surplus Personal Property Corrected b) Disposal of General Fixed Assets Corrected c) Fixed asset detail Corrected 3 EPA Grant Administration Corrected The City of Sebastian was established under Sections 1826-1832 of the Revised Statutes of Florida in 1924. The City of Sebastian's component unit, the Police Officers' Pension Plan, was _ established under Section 58-46 through 58-54 Code of Ordinances in October 1989. The Financial Report filed with the Department of Banking and Finance pursuant to Section 218.32, Florida Statutes is in agreement with the accompanying general purpose financial statements of the City for the fiscal year ended September 30, 2000. The City of Sebastian is not in a state of financial emergency as a consequence of conditions in Section 218.503(1), Florida Statutes. The City of Sebastian has complied with Florida Statute Section 218.415, "Local Government Investment Policies." Our audit did not disclose any further items that would be required to be reported under the Rules of the Auditor General, Chapter 10.554(1)(f). _ This report is intended solely for the information and use of the audit committee, management, others within the organization, City Council, federal and state awarding agencies and the Office of 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. ,4'*Y / SA4,t C yr AC Hoyman, Dobson & Company, P.A. December 11, 2000 105 ., City of Sebastian .., 1225 MAIN STREET ❑ SEBASTIAN, FLORIDA 32958 TELEPHONE (561) 589-5330 ❑ FAX (561) 589-5570 M January 24, 2001 am Honorable Mayor and Members of the City Council City of Sebastian, Florida Subject: Response to Management Letter Comments Dear Mayor and Council Members: The Auditors have provided management letter comments which were noted during the course of the audit for the 1999-2000 fiscal year. A management letter comment is a recommendation for improvement ' of the City's financial management, accounting procedures, and internal control. The responses below are presented in the same order as the comments appear in the Auditor's letter. 1. Police Pension The Police Officers' Pension Plan is considered a Chapter Plan under F.S. Chapter 185. Although .� F.S. 185.221 (2) requires an actuarial valuation at least every three years, this requirement is supplemental in nature since the plan is required to comply with F.S. 218.321 which calls for the timing of actuarial valuations to conform with generally accepted accounting principles which ,., requires an actuarial valuation at least every two years. A letter was delivered to the President of the Police Pension Board explaining the statute and the need to be in compliance and a request that the board adhere to the Florida Statutes. A supplemental letter will be sent requesting compliance. 2. Compliance with Grant Requirements The Finance department initiated a policy in the prior year following a previous comment regarding administration of grants for the purpose of filing all grant reports and preparing and drawing down funds. In addition, the Finance department is in the process of developing grant checklists in accordance with grant documents to ensure future compliance with grant provisions and document retention. ence R. oore City Manager 106 M MY OF HOME OF PELICAN ISLAND THIS PAGE INTENTIONALLY LEFT BLANK 107