HomeMy WebLinkAbout1998 - 1999CITY OF SEBASTIAN, FLORIDA
COMPREHENSIVE ANNUAL MANC L REPORT
For The Fiscal Year October 1, 1998
Through September 30, 1999
CITY OF
SEBASTIAN, FLORIDA
Comprehensive Annual Financial Report
For the Year Ended September 30, 1999
CITY COUNCIL
Chuck Neuberger ......................Mayor
Joe Barczyk
Ben A. Bishop
Edward A. Majcher, Jr.
CITY OFFICIALS
Terrence R. Moore...................City Manager
Kathryn M. O'Halloran.................City Clerk
Rich Stringer ...........................City Attorney
Mark C. Mason, CPA......... Director of Finance
Prepared By: Finance Department
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INTRODUCTORY SECTION
This section contains the following subsections:
Table of Contents
Letter of Transmittal
Organizational Chart
CITY OF SEBASTIAN, FLORIDA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
SEPTEMBER 30,1999
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TABLE OF CONTENTS
INTRODUCTORY SECTION
Pave
TitlePage.......................................................................................................................................................
Table of Contents ...........................
Letterof Transmittal......................................................................................................................................
vi _
OrganizationalChart ......................... :....... ........................................... :.........................................................
xiv
FINANCIAL SECTION "
IndependentAuditor's Report ........................................................................................................................
2
Combined Financial Statements'— Overview
Exhibit
Combined Balance Sheet -Primary-Government 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
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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
FundBalance........................................::.............................................................
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
Combining Balance Sheet.......................................................................................
B-1
e.
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
(Budgetary Basis)................................................................................................
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
Discretionary Sales Surtax Special Revenue Fund — Statement of Revenues,
Expenditures, and Changes in Fund Balance — Budget to Actual
(Budgetary Basis ..............................................
B-5
47
Capital Proiects Funds
.�
Combining Balance Sheet ........................................
Combining Statement of Revenues, Expenditures, and Changes in
FundBalances.....................................................................................................
C-2
50
Enterorise Funds
CombiningBalance Sheet......................................................................................
D-1
53
..
Combining Statement of Revenues, Expenses, and Changes in
RetainedEarnings...............................................................................................
D-2
54
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Combining Statement of Cash Flows.......................................................................
D-3
55
Fiduciary Funds
Combining Balance Sheet.......................................................................................
E-1
57
Expendable Trust Funds — Combining Statement of Revenues, Expenditures,
and Changes in Fund Balances...........................................................................
E-2
59
..
Performance Deposits Fund — Statement of Changes in Assets and Liabilities......
E-3
60
General Fixed Assets Account Group
Schedule of General Fixed Assets — By Sources ....................................................
F-1
63
Schedule of General Fixed Assets by Function and Activity..._ .............................
F-2
64
Schedule of Changes in General Fixed Assets by Function and Activity ...............
F-3
65
General Lone -Term Debt Account Groun
Schedule of General Long -Term Obligations ......................... _............................
G-1
68
STATISTICAL SECTION (Unaudited)
Table
General Governmental Expenditures & Other Financing Uses by Function —
LastTen Fiscal Years............................................................ .._.........................
1
71
General Governmental Revenues & Other Financing Sources — Last Ten
FiscalYears........................................................................................................
2
73
Property Tax Levies and Collections — Last Ten Fiscal Years ...............................
3
75
Assessed and Estimated Actual Value of Property — Last Ten Fiscal Years ..........
4
77
PrincipalTaxpayers................................................................................................
5
79
Property Tax Rates — Direct and Overlapping Governments — Last Ten
FiscalYears........................................................................................................
6
80
Special Assessments Billing and Collections — Last Ten Fiscal Years ...................
7
81
Computationof Legal Debt Margin........................................................................
S
82
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Table
Page
Ratio of Net General Obligation Bonded Debt to Assessed Value and Net
General Obligation Bonded Debt Per Capita ......................................................
9
83
Ratio of Annual Debt Service Expenditures for General Obligation Bonded Debt
To Total General Government Expenditures......................................................
10
83
Computation of Direct and Overlapping Bonded Debt — General Obligation
Bonds..................................................................................................................
11
84
Revenue Bond Coverage — Golf Course Bond — Last Ten Fiscal Years .................
12
85
Demographic Statistics — Last Ten Fiscal Years ....................................................
13
86
Property Value, Construction and Bank Deposits — Last Ten Fiscal Years............
14
87
_
MiscellaneousStatistics..........................................................................................
15
89
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 Auditine Standards......................................................................
92
Report on Compliance with Requirements Applicable to Each Major
Program and Internal Control Over Compliance in Accordance With
OMBCircular A-133..........................................................................................
94
Schedule of Findings and Questioned Costs...........................................................
96
�.
Schedule of Federal Awards...................................................................................
97
Independent Auditor's Report on Examination of Management's Assertion
About Compliance with Specified Requirements ................................................
98
City of Sebastian Management's Assertion about Compliance with Specified
Requirement........................................................................................................
106
,.
Schedule of State of Florida Financial Assistance ..................................................
101
Independent Auditor's Management Letter Comments ..........................................
102
Response to Management Letter Comments...........................................................
106
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City of Sebastian
1225 MAIN STREET a SEBASTIAN, FLORIDA 32958
TELEPHONE (561) 589-5330 n FAX (561) 589-5570
February 16, 2000
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, 1999, 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.
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Renortine 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, Inc.00 and Winn Dixie Stores, hic.0 The Indian River County
Unemployment rate in 1998 was 8.1% down from 8.4% 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 significantly. 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 1998-1999 fiscal year, the millage rate was decreased from 6.7 to 6.5 or 3.1%. This 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 $2,374,977 or 38.8% of the 1998-1999 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
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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.
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Budgetary Control
w 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, 1999. Appropriations are approved on an annual basis and are subject
to regular review by City Management and a semi-annual 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 with the State Board of Administration which pools funds
from local governmental units and were also invested with a local bank which is considered a Qualified
Public Depository as described in the Florida Security for Public Deposits Act.
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
1998-1999 fiscal year.
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Outstanding bonded indebtedness, net of unamortized discount, and note payable of the City at September
30, 1999, is summarized below:
Primary Government
Public Improvement Note Payable
Revenue Bonds
Total primary government
Balance Bonds Balance
10/1/98 Retired 9/30/99
$3,268,890 $157,849
2,013,623 138,571
Risk Manaeement
$3,111,041
1,875,052
.. 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.
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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
1999
1998
From 1998
Property taxes
$2,727
$ 2,690
$ 47
Other taxes
1,073
2,933
(1,860)
Licenses and permits
449
407
42
Intergovernmental
1,372
1,366
6
Charges for services
33
33
--
Fines, forfeitures, penalties and fees
90
71
19
Interest and other revenues
244
269
25
Total revenues
$5,988
$ 7,759
$ (1,771)
Transfers from other funds
274
-
274
Proceeds from note payable
3,261
(3,261
Total revenues and other financing sources
$-14,72$)
General fund revenues totaled $6,261,718 for the fiscal year, a decrease of $4,757,985 or 43.2% from 1998
amounts. This decrease resulted from the creation of special revenue funds for Discretionary Sales Tax and
Local Option Gas Tax and reclassification of these revenue sources as well as a one time non -recurring
recording of proceeds from note payable of $3,261,030 in the prior year. Property taxes increased modestly
even though there was a decrease in millage rate and was due to an increase in delinquent property tax
collections. Franchise fees and Public Utility taxes increased modestly by approximately 2% which was a
result of new construction in housing. Licenses and permits increased primarily as a result of an increase in
permits issued for new construction. Traffic citation revenue increased $13,606 or 36.1% from the previous
year. Interest and other revenues decreased $24,399 due to a decrease in interest earnings as a result of
reclassification of revenue sources to the special revenue funds and a decrease in rents. The chart below
shows the relative distribution of the General fund revenues.
GENERAL FUND REVENUES
FY 1998-1999
1% Inw-"Other
4% TranfM in
Charges for services 4%
1%
Property
axa
Intcsgovemmrnu{ 44%
22%
Licenses and pem,its Othcrtaxes
7°/. 17%
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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
1999
1998
From 1998
General government
$ 1,684
$2,009
$ (325)
Police
2,123
1,999
124
Public works
1,909
2,007
(99)
Debt service
32
133
101
Total expenditures
$ 5,748
$6,148
$ (400)
Transfers to other funds
415
-
415
Capital projects outlay
-
1,818
(1,818)
Residual equity transfers out
4,128
4,128
Total expenditures and other financing uses
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Expenditures of the General fund totaled $10,290,792, an increase of $2,324,670 or 29.2% over 1998
amounts. This increase results primarily from reclassification of capital projects to capital project funds.
Decreases in general government expenditures and public works reflects the City's commitmerit to
decreasing costs while improving services. The Police departments increase reflects a new police officer,
and Council approved salary increases and benefits package. The decrease in debt service reflects the final
payment associated with a note payable used to purchase land. In addition, the total decreases were offset by
an increase in transfers to other funds to finance capital and transportation related improvements.
GENERAL FUND EXPENDITURES
FY 1998-1999
Residual equity
transfers out
400% General government
29%
Transfers to other Police
37%
funds )14
4% Debt service Public works
1% 33%
General fund expenditures, encumbrances, operating transfers out and residual equity transfers out were
$184,448 below budgeted amounts. General fund expenditures, encumbrances, operating transfers out, and
residual equity transfers out were less than revenues and operating transfers in by $55,607. The General
fund's undesignated fund balance increased $98,720 in the 1998-1999 fiscal year.
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Special Revenue Funds
The revenues of the Special Revenue funds are derived from specific sources and are designated for specific
uses. In 1998-1999 two additional Special Revenue funds were added to account for the resources and uses
of Discretionary Sales Tax and Local Option Gas Tax. These two funds provide a significant source of
revenue. The Community Development Block Grant that provided fimding for improvements ended in the
1999-1999 fiscal year.
Discretionary Sales Tax, which represents an additional $.Ol sales tax and is designated for capital
improvements and equipment with a life of five years or more, was accounted for in the General fund in prior
years. Discretionary Sales Tax revenue was $1,553,672 for the year ended September 30, 1999.
•
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 $484,054 during the 1998-1999 fiscal year 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
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.
Canital Proiects
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The Capital Projects funds were established in the 1998-1999 fiscal year to account for General Capital
Projects, Capital Improvement Projects, Transportation Improvement Projects, and the Road Paving Project
that were formerly accounted for in the General fund. 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 1998-1999 totaled $1,681,339. The major
capital expenditure in 1999 was for swale drainage improvements in the amount of $699,223. Other ..
significant projects were the Road Paving program and Schumann Drive Drainage improvements. Thirty-
five capital improvement projects were in process during the 1999 fiscal year.
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General Fixed Assets
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, 1999, the general
fixed assets of the City amounted to $20,127,861. 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.
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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
1999
1998
From 1998
Operating revenues
$1,354,999
$1,299,113
$ 55,886
Operating expenses(1,089,641)1
027 702
61,939
Operating income
265,358
271,411
(6,053)
Non -Operating revenues
59,977
52,255
7,722
Non -Operating expenses
(102,650
(107,850)
5,200
.� Net income
S 222,685
215.816
Operating revenues increased $55,886 primarily due to the excellent weather enjoyed during the fiscal year.
There were no changes to the greens fees or rates in 1999. The increase in revenue was offset by an increase
in operating expenses resulting from the final year of a maintenance agreement increase, however, 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
1999
1998
From 1998
Operating revenues
$ 122,265
$ 79,632
$ 42,633
Operating expenses
(80.390)
(69.303)
11,087
Operating income
41,875
10,329
31,546
Non -Operating revenues
13,187
8,591
4,596
Net income
5 55,062
S 18,220
Operating revenues increased as a result of a one-time increase in lease payments from the golf course. The
Golf Course leases the land from the Airport pursuant to a lease agreement with increases every five years in
accordance with the CPI. The most recent increase had not been calculated and a one-time catch up of lease
payments was made in 1999. In addition, interest income increased due to favorable interest rates.
_ 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, and Performance Deposits. The largest of
these funds is the Police Pension plan which had net assets at September 30, 1999 of $1,828,736.
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Retirement Commitments
Police Pension Plan — There were 31 active and retired members in the Police Pension Plan as of September
30, 1999. 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 1999. The City's contributions totaled $202,112 or 17.5% of covered payroll.
MAJOR H TTIATIVES
Airport
Plans are underway to secure a Joint Participation Agreement with the Florida Department of Transportation
for funding a Five -Year Plan. The funding is anticipated to be $250,000 or 80% of the total funds required
for the study.
Building improvements
Funding was provided in the Fiscal Year 1999-2000 budget to improve existing structures and facilities. The
estimated improvement costs are $750,000 over a two year period and includes City Hall, the Yacht Club
Facility, and the Community Center.
Road Paving Improvements
Beginning in October 1999, Road Paving Improvements got underway with the first phase of approximately
seventy miles of streets and unpaved roads programmed to be paved over a two year period of time. In
conjunction with the paving project, drainage improvements were programmed and funded in the amount of
approximately $1,200,000. When combined with the funding secured via a bank loan in the amount of
$3,261,030 for the paving of deteriorated streets within the City, the total investment in the road and drainage
improvements is approximately $4,461,030.
Acknowledgements
The preparation of this report would not be possible without the dedicated service of the Finance 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
Djre or of Finance
errence R. ore
City Manager
I 1 I I I I I I 1 I I I I I I I I I I
CITY OF SEBASTIAN
ORGANIZATIONAL CHART
CITIZENS OF I
SEBASTIAN
BOARDS &
CrrY COUNCIL
I CON&IISSIONS
CITY
CITY
CLERK
'
' ATTORNEY
CI
MANAGER
I
GROWTH
I
MANAGEMENT
1111
1
I
FINANCE
I
111
ENGINEERING
I POLICE 1
I 1111
PUBLIC WORKS
I
I
I GOLF COURSE
1 I AIRPORT
1111
1111
1
x
III
MAN
ROADS &
BUILDING
I
RESOURCES
ADMINISTRATION
DRAINAGE
PATROL
CENTRAL GARAGE
BUILDING
DETECTIVE
MAINTENANCE
J PARKS &
DISPATCH
f RECREATION
CEMETERY I
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FINANCIAL SECTION
This section contains the following subsections:
➢ Independent Auditor's Report
➢ General Purpose Financial Statements
➢ Combining and Individual Funds and Account
Groups Statements
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HOYMAN, DOBSON & COMPANY, P.A.
CERTIFIED PUNLI( VC-(-c)UNTANTS
IIIIIIIIIIIIIIIIr
215 Boytree Drive, Suite 1, Melbourne, Florida 32940, 321-255-0088, Fax 321-259-8648, w ..hoyman.com
Independent Auditor's Report
Honorable Mayor and Members of City Council
City of Sebastian
Sebastian, Florida
Charles W. Hayman, Jc
Barbara J. Oswalt
Thomas L Kirk
Karen E. Kirkland
Deborah A. Bradley
DIRECTOR EMERITUS
Roger Dobson
Eugene K. Blernmg
We have audited the accompanying general purpose financial statements of the City of Sebastian,
Florida, as of and for the year ended September 30, 1999, 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 Auditine 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
no material respects, the financial position of the City of Sebastian, Florida, as of September 30, 1999,
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.
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— 2 —
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 Members of City Council
City of Sebastian
Page Two .,
In accordance with Government Auditing- Standards, we have also issued our report dated
December 3, 1999, on our consideration of the City of Sebastian'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 Organizations, 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 presented, in all material respects, in relation to the general
purpose financial statements taken as a whole.
c tom, R4.
Hoyman, &bson & Company, P.A.
December 3,1999
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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 I
1 of 4
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CITY OF SEBASTIAN, FLORIDA
COMBINED BALANCE SHEET
PRIMARY GOVERNMENT FUND TYPES AND ACCOUNT GROUPS
SEPTEMBER 30, 1999
Governmental Fund Types
Special
Debt
Capital
�.
ASSETS AND OTHER DEBITS
General
Revenue
Service
Projects
Cash and cash equivalents
$ 33,267 $
46,327
$ 2,511
$ 257,085
Equity in pooled investments
2,824,620
33,446
21,053
4,180,014
Investments
—
—
--
--
Accounts receivable, net
102,369
--
Assessments receivable
--
245,397
Due from other funds
2,979
--
--
--
Due from other governments
83,438
144,260
102,370
_
Inventory
12,214
--
--
Prepaid expenses
3,346
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
$ 3,062,233 $
224,033
$ 268,961
$ 4,539,469
The accompanying notes to financial statements are an integral part of this financial statement.
5
w
w
Proprietary
Fiduciary
Totals
Fund
Fund
(Memorandum
w
Types
Types
Account Groups
Only)
General
General
Trust
Fixed
Long -Term
Primary
w
Enterprise
and Agency
Assets
Obligations
Government
$ 185,850
$ 7,375
$ —
$
$ 532,415
908,057
154,736
—
8,121,926
—
1,828,736
—
—
1,828,736
5,393
—
—
—
107,762
w
—
—
—
—
245,397
—
—
—
—
2,979
—
—
—
330,068
w
7,189
—
—
—
19,403
33,912
—
—
—
37,258
399,572
—
—
—
399,572
—
—
20,127,861
—
20,127,861
1,318,580
—
—
—
1,318,580
w
53,131
—
—
—
53,131
—
—
—
23,564
23,564
—
—
—
3,675,061
3,675,061
w
$ 2,911,684
$ 1,990,847
$ 20,127,861
$ 3,698,625
$ 36,823,713
w
IN
(Continued)
Exhibit 1
2 of 4
Exhibit 1
3 of4
CITY OF SEBASTIAN, FLORIDA
COMBINED BALANCE SHEET
PRIMARY GOVERNMENT FUND TYPES AND ACCOUNT GROUPS
SEPTEM 3ER 30,1999
(Continued)
Governmental Fund Types
Special Debt
LIABILITIES, EQUITY AND OTHER CREDITS General Revenue Service
Liabilities:
Accounts payable and accrued liabilities
$ 268,365 $
6,064 $
Retainage payable
—
—
Due to other funds
—
—
Deposits
5,840
Deferred revenues
44,960
—
Bonds payable
—
—
Notes payable
—
—
Total liabilities
319,165
6,064
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
43,113
—
Debt service
—
—
Law enforcement
—
—
Employees' pension benefits
—
—
Unreserved:
Designated for inventory
12,214
—
Designated for donations
5,278
—
Designated for emergencies
350,000
—
Designated for road paving
—
—
Designated for cemetary care
—
—
Undesignated
2,332,463
217,969
Total equity and other credits
2,743,068
217,969
Total liabilities, equity and other credits
$ 3,062,233 $
224,033 $
The accompanying notes to financial statements are an integral part of this financial statement.
7
Capital
Projects
— $ 9,273
— 34,809
2,979
245,397 40,514
245,397 87,575
— 424,221
23,564 —
3,095,064
— 932,609
23,564 4,451,894 _
268,961 $ 4,539,469
4of4
Proprietary
Fiduciary
Totals
Fund
Fund
(Memorandum
Types
Types
Account Groups
Only)
.�
General
General
Trust
Fixed
Long -Term
Primary
Enterprise
and Agency
Assets
Obligations
Government
$ 24,193
$ 208
$
$ 301,063
$ 609,166
.�
--
—
34,809
2,979
--
479
6,319
70,442
--
401,313
1,588,531
286,521
1,875,052
--
3,111,041
3,111,041
1,683,166
687
--
3,698,625
6,040,679
--
20,127,861
--
20,127,861
530,895
--
530,895
.,
69,863
69,863
105,200
105,200
209,490
209,490
313,070
313,070
--
467,334
—
23,564
3,939
3,939
1,828,736
1,828,736
—
12,214
5,278
350,000
--
—
3,095,064
153,128
153,128
.�
--
4,357
--
3,487,398
1,228,518
1,990,160
20,127,861
—
30,783,034
$ 2,911,684
$ 1,990,847
$ 20,127,861
$ 3,698,625
$ 36,823,713
M
0
M
Exhibit 2
1 of
CITY OF SEBASTIAN, FLORIDA
COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
ALL GOVERNMENTAL FUND TYPES AND EXPENDABLE TRUST FUNDS
FOR THE YEAR ENDED SEPTEMBER 30,1999
Governmental
Special
General
Revenue
Revenues:
Taxes
$ 3,800,242 $
Licenses and permits
448,928
--
Intergovernmental
1,371,522
2,228,952
Charges for services
33,097
--
Fines
89,697
-
Special assessments
--
Contributions
--
--
Interest and other revenues
244,207
49,446
Total revenues
5,987,693
2,278,398
Expenditures:
Current:
General government
1,684,151
131,483
Public safety
2,122,823
--
Public works
1,908,915
--
Housing and community development
--
4,830
Debt Service:
Principal
31,871
157,849
Interest
279
142,151
..
Capital outlay
--
191,226
Total expenditures
5,748,039
627,539
Excess(deficiency) of revenues over(under)expenditures
239,654
1,650,859
Other financing sources(uses):
Operating transfers in
274,025
4,830
Operating transfers out
(414,959)
(1,437,720)
Total other financing sources(uses)
(140,934)
(1,432,890)
Excess of revenues over expenditures
and other financing sources(uses)
98,720
217,969
Fund balances, October 1
6,772,142
--
Residual equity transfers in(out)
(4,127,794)
--
Fund balances, September 30
$ 2,743,068 $
217,969
The accompanying notes to financial statements are an integral part of this financial statement.
9
Exhibit 2
2of2
Fiduciary
Fund
Fund Types
Types
Totals
Debt
Capital
Expendable
(Memorandum
Service
Projects
Trusts
Only)
$
3,800,242
--
--
448,928
260,102
42,525
3,903,101
--
--
33,097
--
89,697
44,964
--
44,964
--
--
650
650
21,257
162,827
34,670
512,407
66,221
422,929
77,845
8,833,086
456
13,660
7,281
1,837,031
--
2,122,823
1,908,915
--
4,830
35,523
225,243
18,510
--
--
160,940
--
1,667,678
56,716
1,915,620
54,489
1,681,338
63,997
8,175,402
11,732
(1,258,409)
13,848
657,684
--
1,582,509
--
1,861,364
--
(8,685)
(1,861,364)
--
1,582,509
(8,685)
--
11,732
324,100
5,163
657,684
11,832
--
156,261
6,940,235
--
4,127,794
--
--
$ 23,564
$ 4,451,894 $
161,424
$ 7,597,919
10
Exhibit 3
1 of
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, 1999
_
General Fund
Special Revenue Funds
Actual on
Variance
Actual on
Variance
Budgetary
Favorable
Budgetary
Favorable
Budget
Basis
(Unfavorable)
Budget
Basis
(Unfavorable)
Revenues:
Taxes
$ 3,803,410
$ 3,800,242
$ (3,I68) $
$
$
Licenses and permits
357,000
448,928
91,928
-
Intergovernmental
1,328,800
1,371,522
42,722
2,094,956
2,228,952
133,996
.
Charges for services
27,750
33,097
5,347
--
--
--
Fines
77,750
89,697
11,947
Special assessments
--
--
--
Interest and other revenues
521,824
244,207
(277,617)
--
49,446
49,446
Total revenue
6,116,534
5,987,693
(128,841)
2,094,956
2,278,398
183,442
Expenditures:
t
Current:
General government
1,780,173
1,701,576
78,597
135,000
131,483
3,517
Public safety
2,170,980
2,124,968
46,012
--
-
-
_
Public works
1,992,297
1,932,458
59,839
--
--
Housing and community
development
--
--
--
4,830
4,830
Debt Service:
Principal
31,871
31,871
157,887
157,849
38
Interest
279
279
142,113
142,151
(38)
Capital Outlay
--
--
--
222,196
191,226
30,970
Total Expenditures
5,975,600
5,791,152
184,448
662,026
627,539
34,487
Excess of revenues over
..
over expenditures
140,934
196,541
55,607
1,432,930
1,650,859
217,929
Other financing sources (uses)
r..
Operating transfers in
274,025
274,025
--
4,830
4,830
--
Operating transfers out
(414,959)
(414,959)
(1,437,760)
(1,437,720)
40
Total other financing
sources (uses)
(140,934)
(140,934)
-
(1,432,930)
(1,432,890)
40
Excess of revenues and other
financing sources over
expenditures and other
financing uses
--
55,607
55,607
217,969
217,969
Fund balance, October 1
6,772,142
6,772,142
--
--
--
Residual equity transfers out
(4,127,794)
(4,127,794)
--
--
--
Fund balance, September 30
$ 2,644,348
$ 2,699,955
$ 55,607 $
-
$ 217,969
$ 217,969
The accompanying notes to financial statements are an integral part of this financial statement.
11
Exhibit 3
2of2
Debt Service Fund Total I YI
. Actual on Variance Actual on Variance
Budgetary Favorable Budgetary Favorable
Budget Basis (Unfavorable) Budget Basis (Unfavorable)
$ $ $ $ 3,803,410 $ 3,800,242 $ (3,168)
357,000 448,928 91,928
3,423,756 3,600,474 176,718
- 27,750 33,097 5,347
- - 77,750 89,697 11,947
39,700 44,964 5,264 39,700 44,964 5,264
15,000 21,257 6,257 536,824 314,910 (221,914)
54,700 66,221 11,521 8,266,190 8,332,312 66,122
550 456 94 1,915,723 1,833,515 82,208
MR - -- - 2,170,980 2,124,968 46,012
- - 1,992,297 1,932,458 59,839
.� -- - 4,830 4,830 -
35,600 35,523 77 225,358 225,243 115
18,550 18,510 40 160,942 160,940 2
- - -- 222,196 191,226 30,970
54,700 54,489 211 6,692,326 6,473,180 219,146
- 11,732 11,732 1,573,864 1,859,132 285,268
- - -- 278,855 279,855 -
- (1,852,719) (1,852,679) 40
- -- (1,573,864) (1,573,824) 40
11,732 11,732 - 285,308 285,308
.n
11,832 11,832 -- 6,783,974 6,783,974 --
-- - -- (4,127,794) (4,127,794) -
$ 11,832 $ 23,564 $ 11,732 $ 2,656,180 $ 2,941,488 $ 285,308
12
Exhibit 4
CITY OF SEBASTIAN, FLORIDA
COMBINED STATEMENT OF REVENUES, EXPENSES AND CHANGES IN EQUITY
ALL PROPRIETARY FUND TYPES
FOR THE YEAR ENDED SEPTEMBER 30, 1999
REVENUES:
Golf course fees
Rents
Other revenue
Total revenue
Operating expenses:
Salaries, wages and employee benefits
Contractual services, materials and supplies
Depreciation
Amortization
Total operating expenses
Operating income
Nonoperating revenues:
Interest income
Interest expense
Gain on sale of fixed assets
Total nonoperating revenues
Net income
Retained earnings, October 1
Retained earnings, September 30
The accompanying notes to financial statements are an integral part of this financial statement.
13
Proprietary
Fund
Types
$ 1,303,653
147,329
26,282
1,477,264
204,416
818,382
142,156
5,077
1,170,031
307,233
72,164
(102,650)
1,000
(29,486)
277,747
419,876
$ 697,623
r
M
�W
M
me
Exhibit 5
1 of 2
.� CITY OF SEBASTIAN
COMBINED STATEMENT OF CASH FLOWS
ALL PROPRIETARY FUND TYPES
FOR THE YEAR ENDED SEPTEMBER 30,1999
INCREASE(DECREASE) IN CASH AND CASH EQUIVALENTS
Cash flows from operating activities:
Cash received from customers
Cash payments to suppliers for goods and services
Cash payments for employee services
�. Other operating revenue
Net cash provided by operating activities
Cash flows from capital and related financing activities:
Acquisition and construction of capital assets
Receipts from capital grants
Principal paid on revenue bond maturities
Interest paid on revenue bonds
Proceeds from sale of capital assets
Net cash used in capital and related financing activities
Cash flows from investing activities:
Purchase of investment securities
Interest on investments
Net cash used in investing activities
Net (decrease) in cash and cash equivalents
Cash and cash equivalents at October I
•
Cash and cash equivalents at September 30
M
The accompanying notes to financial statements are an integral part of this financial statement.
14
Proprietary
Fund
Types
$ 1,416,661
(817,260)
(202,609)
55,385
452,177
(89,858)
23,627
(105,000)
(102,650)
1,000
(272,881)
(346,302)
72,164
(274,138)
(94,842)
280,692
185,850
(Continued)
M
Exhibit 5
2 of 2
CITY OF SEBASTIAN
COMBINED STATEMENT OF CASH FLOWS
ALL PROPRIETARY FUND TYPES
FOR THE YEAR ENDED SEPTEM 3ER 30,1999
(Continued)
RECONCILIATION OF OPERATING INCOME TO
NET CASH PROVIDED BY OPERATING ACTIVITIES
Operating income
Adjustments not affecting cash:
Depreciation expense
Amortization
Changes in assets and liabilities:
(Increase) in accounts receivable
Decrease in prepaid expenses
(Decrease) in accounts payable
Increase in compensated absences
Increase in accrued wages
Increase in deferred revenue
Net cash provided by operating activities
The accompanying notes to financial statements are an integral part of this financial statement.
15
Proprietary
Fund
Types
$ 307,233
142,156
5,077
(5,393)
19,450
(18,328)
521
1,286
175
$ 452,177
00
Exhibit 6
.� CITY OF SEBASTIAN, FLORIDA
COMBINED STATEMENT OF CHANGES IN PLAN NET ASSETS
ALL PENSION TRUST FUNDS
SEPTEMBER 30,1999
/• vA �FPti,L (�� S c� yew- �,�7�1i
Pension
Trust
.,
Fund
ADDITIONS
Contributions
Employer contributions
$ 103,547
Employee contributions
51,774
State contributions
46,790
_
Total contributions
202,111
Investment income
Net appreciation in fair value of investments
96,575
Interest and dividends
71,917
_
168,492
Less investment expenses
(5,915)
Net investment income
162,577
Total additions
364,688
DEDUCTIONS
Benefits
24,283
Refunded contributions
37,646
Total deductions
61,929
Net increase
302,759
Net assets held in trust for pension benefits, October 1, 1998
1,525,977
Net assets held in trust for pension benefits, September 30, 1999
$ 1,828,736
.. The accompanying notes to financial statements are an integral part of this financial statement.
16
CITY OF SEBASTIAN, FLORIDA
Notes to the Financial Statements
September 30,1999
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 16,000 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. Reportine 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.
Blended Component Units
The following component units are blended with the primary government for financial statement purposes
because the component unit's governing body is substantially the same as the City Council or because the
component unit exclusively serves the City. The financial statements of these component units may be
obtained from the City Clerk of the City of Sebastian.
Community Redevelopment Agency (CRA) — The governing body of the CRA is the Sebastian City
Council. The CRA was not funded in fiscal year 1999, 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:
Govemmentai Funds
M
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, police, 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 goverment. 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 funds 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
_ Canital 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:
Canital Proiects Fund, Purpose
General Capital Projects Capital improvements, such as the Citywide
Network, Cemetery Pump House addition,
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:
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:
Enterprise 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.
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 five 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 2"d 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.
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.
Aeencv 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.
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:
19
General Fixed Asset Account Groun
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 Groun
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, 1999. 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
assts) 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.
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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
E. Accountine and Renortin¢ for Proorietary Funds
r�
Pursuant to Governmental Accounting Standards Board (GASB), Statement 20, Accountine and Financial
ReDortine for Proorietary Funds and Other Governmental Entities That Use Pronrietary Fund Accountine, ..
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. Budgetary 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 II.).
G. Assets. Liabilities and Fund Eouitv
W
1. Pooled Cash
Equity in pooled cash consists primarily of cash in bank. 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, 1999, 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
General Capital Projects fund; all Enterprise funds; all Expendable Trust funds except the Law
Enforcement and Law Enforcement Education Trust funds.
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
21
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.
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 2040 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.
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22
6. Fund Eauitv
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 on the next page:
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. Interfund eliminations have not been
made in the aggregation of this data.
J. Comparative Data/Reclassifications
Comparative total 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.
11. 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
23
the Governmental Accounting Board's Codification of Governmental Accountine_ and Financial Ren_ ortinq
` 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, 1999, is presented on the next page:
Special Revenue Debt Service
General Fund Funds Fund
Excess of revenues over expenses and other financing
sources (uses) (Budgetary Basis) $ 55,607 $ 217,969 $ 11,732
Adjustments: To adjust for encumbrances 43,113 — —
Excess of revenues over expenses and other financing
sources (uses) (GAAP Basis) S 28,720 $ 217.962 $ 11.732
The Building department, Miscellaneous, Central Garage, and Parks and Recreation departments of the
General fund had necessary expenditures which exceeded the budgets by $345, $3,554, $867, and $5,466,
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.
Ill. DETAIL NOTES — ALL FUNDS AND ACCOUNT GROUPS
A. Cash Equivalents
.. 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, 1999, the carrying amount of the City of Sebastian's deposits with banks was $566,978
and the bank balance was $532,415. 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, 1999.
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.
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, mutual funds, stocks, and bonds.
r
The City's investments are categorized to give an indication of the level of risk assumed by the entity at
September 30, 1999. 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 trust department or agent, but not in the
City's name.
Category 1 Fair Value
Primary Government
U.S. Treasury Bills
$ 677,137 $ 670,120
U.S. Treasury Bonds
369,617 352,823
Common Stock
299,848 542,289
Corporate Bonds
32,195 30,327
Sub -total
$ 1,378,797 1,595,559
Local Government Surplus Funds Trust Fund
8,521,498
Money Market Funds
233,177
Total Primary Government Investments
$ 10,350,234
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, 1999, are summarized on the
following page:
Primary Government Transactions
Road Paving Program Fund
General Fund
Totals
E. Pronertv Tax
Due to Due from
$ 2,979 $ -
- 2.979
$ Z $ 2,229
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, 1999, was 6.5000 mills. Current tax collections
were approximately 98% of the total tax levy.
The tax levy of the City is established by City Council. Under Florida law, the assessment of all
properties and the collection of municipal taxes are provided by offices of the County's Property
Appraiser and Tax Collector. Ad Valorem taxes are liened on property values as of January 1. The fiscal
year for which taxes are levied begins October 1. Taxes are due November I 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, Special Revenue, Capital Project, Enterprise and
Trust 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
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-
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25
by the grantor agency or its representative. The amount of grants received during 1999 and recorded in
the accompanying financial statements are presented on the next page:
Primary Government Amount
Community Development Block Grant $191,226
COPS Fast Grant 53,720
Local Law Enforcement Block Grants 52,525
General Construction 189,961
Airport 23,627
Total Reporting Entity $511,052
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, fimds due from
Indian River County, and revenue sharing from the State of Florida.
H. Changes in General Fixed Assets and Property. Plant and Eouivment
Changes in the City's General Fixed Assets and property, plant and equipment for Proprietary fimds were
as follows:
Balance
Balance
October 1,
September 30,
Primary Government General Fixed Assets 1998 Additions Deletions
1999
Land $ 3,067,536 $ — $
$ 3,067,536
.�
Buildings and structures 2,253,993 63,490 —
2,317,483
Improvements other than buildings 9,668,404 1,209,047
10,877,451
Machinery and equipment 2,932,764 474,801 112,223
3,295,342
Construction in process — 570,049 —
570,049
Totals $ 17,922,697 $ 2,317,387 $ 112,223
$ 20,127,861
Balance
Balance
October 1,
September 30,
Proprietary Funds 1998 Additions Deletions
1999
Land $ 9,060 $ — $ —
$ 9,060
Buildings and structures 345,101 2,082
347,183
Improvements other than buildings 2,246,703 49,781 952
2,295,532
_
Machinery and equipment 465,992 37,996 —
503,988
Totals 3,066,856 89,859 952
3,155,763
Less: Accumulated depreciation 1,695,980 142,155 952
1,837,183
Net property, plant and equipment $ 1,370,876 $ (52,296) $ —
$ 1,318,580
I. Long-term Obligations
1. Changes in General Long-term Debt
The following is a summary of changes in General Long -Term Debt of the City for the year ended
September 30, 1999:
Balance
Balance
October 1,
September 30,
Obligation 1998 Additions Deletions
1999
Comnensated absences R 62.224 R 301-063 R 62.224
R 301.063
Capitalized leases 12.870 — 12.870
--
Revenue bond savable 322.044 — 35.523
286.521
.�
Roadway improvement
note payable 3,268,890 157,849
3,111,041
Land note navable 31.870 — 31-R70
--
Totals $ 3,697,898 $ 301,063 $ 300,336
$ 3,698,625
26
2. Debt Service Recuirements to Maturitv
The annual requirements to amortize all bonded debt outstanding as of September 30, 1999, including
interest requirements, is as follows:
PRINCIPAL
Revenue
Roadway
Bond
Improvement
Series
Note
1996
Payable
Year
5.75%
4.40%
2000
$ 44,291
$ 164,910
2001
43,120
172,246
2002
45,634
179,908
2003
48,294
187,911
2004
51,093
196,270
2005-2009
54,089
1,120,346
2010-2014
-
1,089,450
Less unamortized
Bond discount
$ 286,521
$ 3,111,041
3. Revenue Bonds
Golf Course
Revenue
Refunding
Bonds
Series, 1993
Total
6.25%
Interest
Total
$ 110,000 $
245,021 $
564,222
115,000
232,806
563,172
125,000
216,189
566,731
125,000
198,401
559,606
135,000
179,994
562,357
805,000
601,207
2,580,642
195,000
122,777
1,407,227
(21,469)
(21,469)
$ 1,588,531 $
1,796,395 $
6,782,488
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 finance
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.
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, 1999.
The following schedule lists the amounts of retained earnings at September 30, 1999, 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
Earnings
$ 384.553
M
M
M
4. Compensated Absences
The City accounts for compensated absences in conformity with Governmental Accounting Standards
Board's Codification of Governmental Accounting and Financial Ret ortine 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, 1999.
Compensated
Primary Government Absence
Proprietary Fund Tvoe Liabili
Enterprise funds:
Golf Course $ 2.312
Total Primary Government $ 2.312
The General fund obligations for accumulated vested vacation, sick leave, and applicable benefits of
$301,063 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.
I 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, 1999:
Golf Course
Year ending September 30. to: Airport Golf Carts
2000 $ 5 27
The Airport operating lease and the Golf Cart operating lease are due to be renegotiated in Fiscal
,., Year 2000.
2. The airport is the lessor of various properties. The following is a schedule by year of minimum future
rental income on noncancelable operating leases:
Year ending Sen_ tember 30. Amount
2000 $ 73,545
2001 73,545
2002 73,545
2003 73,545
2004 73,545
' Later years 1,198,591
Total minimum future rentals $1.566.316
K. 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, 1998. Although the Police
28
^
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 1998
Retirees and beneficiaries currently
receiving benefits 2
^
Terminated employees entitled to
refund of employee contribution
but not yet received 1
^
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. Benefit provisions and contribution requirements are established by
_
City ordinance as provided in Chapter 58, Article III of the Sebastian City Code. Amendments may only
be made by City Council adoption of a local ordinance.
Funding Policy. The employer, employee, and State contribution requirements are applicable to the Plan
and actuarially determined on a tri-annual basis in accordance with Florida State Statute. Administration
costs of the pension plan is financed by the plan. The employee contribution rate, expressed as a
percentage of compensation, was 5.0% for the 1998-1999 fiscal year. The employer contribution rate,
^
expressed as a percentage of compensation, was 10.0% for 1998-1999 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, 1999. The City's contribution to the plan was $104,474.
^
Required trend information for the Police Officers' Pension Plan was as follows:
Amount
^
Annual Pension Cost (APC)
1997 $121,571
1998 $102,215
1999 $104,474
`
Percentage of APC contributed
1997 100.00%
^
1998 100.00%
1999 100.00%
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, 1998, 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, 1999.
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
^
Q]
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 of Investments. 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, 1999, is as follows:
Balance Balance
October 1, September 30,
Contributions by Source 1998 Additions Deletions 1999
Enterprise Funds:
Airport $ 507,268 $ 23,627 $ $ 530,895
.� Total 23 ¢21 $ $ 530.895
M. Interfund Transactions
There are two types of interfund transactions and transfers that reported as interfund items between the
funds. Quasi-extemal 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, 1999, are as
�. summarized as follows:
Overatine Transfers Transfers In Transfers Out
All Governmental funds and Expendable
Trust funds $1 1"g61"364
_ Residual Eouitv Transfers Transfers In Transfers Out
All Governmental funds $4,127,794 $ 4127.794
The residual equity transfers primarily represent the transfers associated with the creation of Capital
Projects funds, for classification and reporting purposes, which were originally located in the General
fund.
cr
30
IV. SEGMENT INFORMATION - ENTERPRISE FUNDS
Segment information for the Enterprise funds at September 30,
1999, and for the year then ended is as
follows:
Golf
Course
Airport
Totals
Operating revenues
$ 1,354,999 $
122,265
$ 1,477,264
Depreciation and amortization
106,869
40,364
147,233
Operating income
265,358
41,875
307,233
Net income
222,685
55,062
277,747
Net working capital
640,710
295,056
935,766
Property, plant and equipment:
Additions
40,078
49,781
89,859
Deletions
--
952
952
Current year capital contributions
--
23,627
23,627
Total assets
1,890,086
1,021,598
2,911,684
Long-term obligations
1,478,531
—
1,478,531
Total equity
208,896
1,019,622
1,228,518
V. COMMITMENTS AND CONTINGENCIES
A. Construction Commitments
The following is a list by fund of the Reporting Entity's significant construction commitments at September
30, 1999:
Primary Government Amount
Capital Projects funds 4.453.791
B. Litigation
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 November 3, 1999, the City Council approved a contract with a dealer to purchase six police vehicles
for $134,418.
B. Land Purchase
On November 30, 1999, the City purchased 2.25 acres of riverfront land for $655,011.
C. Construction Commitments
On November 17, 1999 the City Council approved a bid for $192,000 for construction of the Elkcam
Waterway Control Structure.
D. Land Sale
On February 4, 2000, the City entered into a contract to sell 1.2 acres of Cemetery Land for $200,000.
31
M
no
do
aft
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
Actuarial
Liability
Actuarial Value of
(AAL)
Valuation Assets
- Entry Age
Date (a)
(b)
Unfunded
AAL Funded
(UAAL) Ration
(c) (alb)
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 SEVEN FISCAL YEARS
Annual
Fiscal
Required
Year
Contributions
1999
$ 104,474 $
1998
102,215
1997
121,571
1996
108,037
1995
107,869
1994
78,833
1993
67,569
City
Contribution
103,547 $
96,039
90,798
97,488
94,881
59,585
58,951
State
Contribution
46,790
39,753
36,089
32,503
26,385
28,744
18,464
Covered
Payroll
(c)
Percentage
Contributed
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
UAAL as
a%of
Covered
Payroll
a)/c
32
-
REOUIRED SUPPLEMENTARY INFORMATION
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:
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
_
8.0%
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:
Actuarially Determined Contribution (A)
Interest on NPO
Adjustment to (A)
Annual Pension Cost
Contributions made
Increase in NPO
NPO beginning of year
NPO end of year
-
9/30/97 9/30/98
$ — $ 62,462 —
— 62,462
— 96,039
— (33,577)
$ — $ (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,
police, public works, etc.).
REH
THIS PAGE INTENTIONALLY LEFT BLANK
35
A-1
CITY OF SEBASTIAN, FLORIDA
GENERAL FUND
COMPARATIVE BALANCE SHEETS
SEPTEMBER 30,1999 AND 1998
1999
1998
Assets
Cash and cash equivalents
$
33,267
$
306,894
Equity in pooled investments
2,824,620
3,217,994
Accounts receivable, net
102,369
81,899
Due from other funds
2,979
—
Due from other governments
83,438
279,565
Inventory
12,214
10,850
Prepaid expenses
3,346
907
Restricted assets - Investments
—
3,277,936
Total assets
$
3,062,233
$
7,176,045
Liabilities and fund balance
Liabilities
Accounts payable and accrued liabilities
$
268,365
$
341,202
Due to other governments
—
1,162
.�
Accrued compensated absences
—
23,121
Deposits
5,840
—
Deferred revenues
44,960
38,418
Total liabilities
319,165
403,903
Fund balance
Reserved for encumbrances
43,113
14,975
Reserved for road improvements
—
3,277,936
Unreserved
Designated for inventory
12,214
10,850
Designated for donations
5,278
—
Designated for emergencies
350,000
—
Designated for capital projects
—
1,093,404
_
Undesignated
2,332,463
2,374,977
Total fund balance
2,743,068
6,772,142
Total liabilities and fund balance
$
3,062,233
$
7,176,045
kri
A-2
1 of 2
CITY OF SEBASTIAN, FLORIDA
GENERAL FUND
COMPARATIVE STATEMENTS OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
FOR THE YEARS ENDED SEPTEMBER 30,1999 AND 1998
1999
1998
Revenues:
Taxes
$ 3,800,242
$ 5,612,313
Licenses and permits
448,928
407,393
Intergovernmental
1,371,522
1,366,428
Charges for services
33,097
32,739
Fines
89,697
71,194
Interest and other revenues
244,207
268,606
Total revenue
5,997,693
7,758,673
Expenditures:
Current:
General Government:
Legislative
17,364
17,422
City manager
154,385
165,372
City clerk
236,750
246,410
City attorney
81,447
84,558
Finance
278,863
215,430
Human resources
94,120
99,070
Growth management
223,576
493,314
Building department
251,630
-
Miscellaneous
346,016
687,042
Total general government expenditures
1,684,151
2,008,618
Police
Police 2,122,823 1,999,369
Total police expenditures 2,122,823 1,999,369
Public works
Administration and engineering
262,324
256,373
Roads and drainage
885,506
933,521
Central Garage
139,167
130,664
Building maintenance
150,216
179,179
Parks and recreation
391,664
425,431
Cemetery
80,038
81,798
Total public works expenditures
1,908,915
2,006,966
Total current expenditures
5,715,889
6,014,953
37
RM
M
A-2
2 of 2
Expenditures (continued):
Debt service:
Principal
Interest
Total debt service expenditures
Capital project outlay
Excess (deficiency) of revenues over (under) expenditures
., Other financing sources (uses)
Operating transfers in
Operating transfers out
Proceeds from note payable
Total other financing sources (uses)
Excess of revenues and other financing sources over
expenditures and other financing uses
Fund balance, October 1
Residual equity transfers out
Fund balance, September 30
W
1999 1998
31,871 126,379
279 6,629
32,150 133,008
— 1,817,903
239,654 (207,191)
274,025 --
(414,959) (258)
— 3,261,030
(140,934) 3,260,772
98,720 3,05-3,581
6,772,142 3,718,561
(4,127,794) —
$ 2,743,068 $ 6,772,142
A-3
1 of 2
CITY OF SEBASTIAN, FLORIDA
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE -
BUDGET AND ACTUAL (BUDGETARY BASIS) GENERAL FUND
FOR THE YEAR ENDED SEPTEMBER 30,1999
Revenues:
Taxes
Licenses and permits
Intergovernmental
Charges for services
Fines
Interest
Other revenues
Total revenue
Expenditures:
Current:
General Government:
Legislative
City manager
City clerk
City attorney
Finance
Human resources
Growth management
Building department
Miscellaneous
Total general government expenditures
Police:
Police
Total police expenditures
Public works:
Administration and engineering
Roads and drainage
Central Garage
Building maintenance
Parks and recreation
Cemetery
Total public works expenditures
Total current expenditures
Actual on
Variance
Budgetary
Favorable
Budget
Basis
(Unfavorable)
$ 3,803,410
$ 3,800,242
$ (3,168)
357,000
448,928
91,928
1,328,800
1,371,522
42,722
27,750
33,097
5,347
77,750
89,697
11,947
193,000
177,691
(15,309)
328,824
66,516
(262,308)
6,116,534
5,987,693
(128,941)
19,410
17,364
2,046
168,510
154,885
13,625
_
246,790
236,750
10,040
83,507
81,447
2,060
305,745
280,201
25,544
..
111,195
99,693
11,502
246,415
228,736
17,679
251,285
251,630
(345)
347,316
350,870
(3,554)
1,780,173
1,701,576
78,597
2,170,980
2,124,968
46,012
2,170,980
2,124,968
46,012
280,320
262,774
17,546
917,777
891,802
25,975
138,300
139,167
(867)
_
169,625
150,216
19,409
402,995
408,461
(5,466)
83,280
80,038
3,242
1,992,297
1,932,458
59,839
5,943,450
5,759,002
184,448
39
A-3
2of2
M
Expenditures (continued):
Debt service:
Principal
Interest
Total debt service expenditures
Excess of revenues over expenditures
.. Other financing sources(uses)
Operating transfers in
Operating transfers out
Total other financing sources(uses)
Excess of revenues and other financing sources over
expenditures and other financing uses
Fund balance, October I
Residual equity transfers out
Fund balance, September 30
M
M
M
M
Actual on
Variance
Budgetary
Favorable
Budget
Basis
(Unfavorable)
31,871
31,871
—
279
279
—
32,150
32,150
—
140,934
196,541
55,607
274,025
274,025
—
(414,959)
(414,959)
—
(140,934)
(140,934)
—
—
55,607
55,607
6,772,142
6,772,142
(4,127,794)
(4,127,794)
—
$ 2,644,348
$ 2,699,955
$ 55,607
M 40
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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
ASSETS
Cash and cash equivalents
Equity in pooled investments
Due from other governments
Total assets
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable and accrued
expenditures
Total liabilities
Fund balances:
Reserved for encumbrances
Unreserved, undesignated
Total fund balances
Total liabilities and fund balances
CITY OF SEBASTIAN, FLORIDA
ALL SPECIAL REVENUE FUNDS
COMBINING BALANCE SHEET
SEPTEMBER 30,1999
Community
Development Local Option Discretionary
Block Grant Gas Tax Sales Tax Totals
$ $ 11,192 $ 35,135 $ 46,327
916 32,530 33,446
40,540 103,720 144,260
$ — $ 52,648 $ 171,385 $ 224,033
$ $ 6,064 $ $ 6,064
6,064 6,064
46,584 171,385 217,969
46,584 171,385 217,969
$ -- $ 52,648 $ 171,385 $ 224,033
43
w
P0
LFA
CITY OF SEBASTIAN, FLORIDA
ALL SPECIAL REVENUE FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE
FOR THE YEAR ENDED SEPTEMBER 30,1999
Community
Development
Local Option
Discretionary
Block Grant
Gas Tax
Sales Tax
Totals
Revenues:
Intergovernmental
$ 191,226
$ 484,054
$ 1,553,672
$ 2,228,952
Interest and other revenues
—
5,913
43,533
49,446
Total revenues
191,226
489,967
1,597,205
2,278,398
Expenditures:
Current:
General government
—
131,483
131,483
Housing and community development:
Operating
4,830
—
—
4,830
Debt Service:
Principal
—
157,849
—
157,849
Interest
—
142,151
142,151
Capital outlay
191,226
--
—
191,226
Total expenditures
196,056
431,483
—
627,539
Excess (deficiency) of revenues over
(under) expenditures
(4,830)
58,484
1,597,205
1,650,859
Other financing sources (uses):
Operating transfers in
4,830
—
—
4,830
.�
Operating transfers out
—
(11,900)
(1,425,820)
(1,437,720)
Total other financing sources (uses)
4,830
(11,900)
(1,425,820)
(1,432,890)
Excess (deficiency) of revenues over
(under) expenditures and other
financing sources (uses)
—
46,584
171,385
217,969
Fund balances, October 1
—
—
—
--
..
Fund balances, September 30
S --
$ 46,584
$ 171,385
$ 217,969
44
I.Si
CITY OF SEBASTIAN, FLORIDA
COMMUNITY DEVELOPMENT BLOCK GRANT
SPECIAL REVENUE FUND
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET TO ACTUAL (BUDGETARY BASIS)
FOR THE YEAR ENDED SEPTEMBER 30, 1999
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 balances, October 1
Fund balance, September 30
Actual on Variance
Budgetary Favorable
Budget Basis (Unfavorable)
$ 222,196 $ 191,226 $ (30,970)
222,196 191,226 (30,970)
45
4,830
4,830
222,196
191,226 (30,970)
227,026
196,056 (30,970)
(4,830)
(4,830) —
4,830 4,830
4,830 4,830 —
m
CITY OF SEBASTIAN, FLORIDA
LOCAL OPTION GAS TAX
SPECIAL REVENUE FUND
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCES -
BUDGET TO ACTUAL (BUDGETARY BASIS)
FOR THE YEAR ENDED SEPTEM 3ER 30, 1999
Actual on
Variance
•
Budgetary
Favorable
Budget
Basis
(Unfavorable)
•
Revenue:
Intergovernmental
$ 446,940 $
484,054
$ 37,114
Interest income
—
5,913
5,913
Total revenues
446,940
489,967
43,027
Expenditures:
Current:
Operating
135,000
131,483
3,517
•
Debt service:
Principal
157,887
157,849
38
Interest
142,113
142,151
(38)
•
Total expenditures
435,000
431,483
3,517
Excess of revenues over expenditures
11,940
58,484
46,544
•
Other financing sources(uses):
Operating transfers out
(11,940)
(11,900)
40
Total other financing sources(uses)
(11,940)
(11,900)
40
Excess (deficiency) of revenues over
(under) expenditures and other
financing sources(uses)
—
46,584
46,584
•
Fund balances, October 1
—
—
--
Fund balance, September 30
$ — $
46,584
$ 46,584
•
EEC
•
Im
CITY OF SEBASTIAN, FLORIDA
DISCRETIONARY SALES SURTAX
SPECIAL REVENUE FUND
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES -
BUDGET TO ACTUAL (BUDGETARY BASIS)
FOR THE YEAR ENDED SEPTEMBER 30, 1999
Revenue:
Intergovernmental
Interest income
Total revenues
Expenditures
Current:
Operating
Debt service:
Principal
Interest
Total expenditures
Excess of revenues over expenditures
Other financing sources(uses):
Operating transfers out
Total other financing sources(uses)
Excess (deficiency) of revenues over
(under) expenditures and other
financing sources(uses)
Fund balances, October I
Fund balance, September 30
Actual on Variance
Budgetary Favorable
Budget Basis (Unfavorable)
$ 1,425,820 $ 1,553,672 $ 127,852
-- 43,533 43,533
1,425, 820 1,597,205 171,385
1,425,820 1,597,205 171,385
(1,425,820) (1,425,820) —
(1,425,820) (1,425,820) —
171,385 171,385
$ — $ 171,385 $ 171,385
47
I
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 Improvements
➢ Transportation Improvements
➢ Road Paving Program
C-1
/:f.X`1e11K
Cash and cash equivalents
Equity in pooled investments
Due from other governments
Total assets
CITY OF SEBASTIAN
ALL CAPITAL PROJECTS FUNDS
COMBINING BALANCE SHEET
SEPTEMBER 30,1999
Capital Road
General Improvement Transportation Paving
Capital Projects Projects Improvements Program
•
•
•
•
Totals
$ 12,609 $ 137,753 $ 106,723 $ -- $ 257,085
-- 964,599 111,347 3,104,068 4,180,014
-- 76,720 25,650 -- 102,370
$ 12,609 $ 1,179,072 $ 243,720 $ 3,104,068 $ 4,539,469 •
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable $
311 $
Retainage payable
Due to other funds
--
Deferred revenue
10,000
Total liabilities
10,311
Fund balances
8,937 $ -- $
31,959 2,850
30,514 --
71,410 2,850
25 $ 9,273
-- 34,809
2,979 2,979
-- 40,514
3,004 87,575
Reserved for encumbrances
11,685
401,584
4,952
6,000
424,221
Designated fund balances
--
--
--
3,095,064
3,095,064
Unreserved, undesignated
(9,387)
706,078
235,918
--
932,609
Total fund balances
2,298
1,107,662
240,870
3,101,064
4,451,894 •
Total liabilities and fund balances $
12,609 $
1,179,072
$ 243,720
$ 3,104,068
$ 4,539,469 •
•
49 •
C-2
CITY OF SEBASTIAN
ALL CAPITAL PROJECTS FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES
FOR THE YEAR ENDED SEPTEMBER 30,1999
Capital
Road
General Improvement
Transportation
Paving
Capital Projects Projects
Improvements
Program
Totals
Revenues:
Intergovernmental
$ - $ 234,452
$ 25,650
$ -
$ 260,102
Interest and other revenues
- -
7,632
155,195
162,827
..
Total revenues
- 234,452
33,282
155,195
422,929
Expenditures:
Current:
General Government
- 13,660
-
-
13,660
Capital outlay:
General Government
22,664 45,000
-
--
67,664
Public Works
6,176 1,444,875
47,520
52,750
1,551,321
Parks
- 36,886
-
-
36,886
Police
- 11,807
-
-
11,807
Total expenditures
28,840 1,552,228
47,520
52,750
1,681,338
Excess(deficiency) of revenue over
(under) expenditures
(28,840) (1,317,776)
(14,238)
102,445
(1,258,409)
Other financing sources
Operating transfers in
31,138 1,396,105
155,266
--
1,582,509
Total other financing sources
31,138 1,396,105
155,266
--
1,582,509
,r
Excess of revenue over
expenditures and other
financing sources
2,298 78,329
141,028
102,445
324,100
Fund balances, October 1
-- -
--
--
Residual equity transfers in
-- 1,029,333
99,842
2,998,619
4,127,794
Fund balances, September30
$ 2,298 $ 1,107,662
$ 240,870
$ 3,101,064
$ 4,451,894
50
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-1
..
CITY OF SEBASTIAN, FLORIDA
ALL ENTERPRISE FUNDS
COMBINING BALANCE SHEET
SEPTEMBER 30,1999
ASSETS
Current assets:
Cash and cash equivalents
Equity in pooled investments
Accounts 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
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 revenue
Current portion of long-term bonds payable
Total current liabilities
Noncurrent liabilities:
Revenue bonds payable, net of
Unamortized discount of $21,469
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
$ 102,853
$ 82,997
$ 185,850
695,295
212,762
908,057
4,120
1,273
5,393
7,189
--
7,189
33,912
--
33,912
843,369
297,032
1,140,401
399,572
--
399,572
399,572
--
399,572
--
9,060
9,060
347,183
--
347,183
1,480,625
814,907
2,295,532
462,467
41,521
503,988
(1,696,261)
(140,922)
(1,837,183)
594,014
724,566
1,318,580
53,131 53,131
53,131 -- 53,131
$ 1,890,086 $ 1,021,598 $ 2,911,684
M
M
M
00
M
$ 22,217 $ 1,976 $ 24,193
70,442 -- 70,442 om
110,000 -- 110,000
202,659 1,976 204,635
1,418,531 -- 1,478,531
1,681,190 1,976 1,683,166
-- 530,895 530,895
69,863 -- 69,863
105,200 105,200
209,490 -- 209,490
(175,657) 488,727 313,070
208,896 488,727 697,623
$ 1,890,086 $ 1,021,598 $ 2,911,684
53 "'
D-2
CITY OF SEBASTIAN, FLORIDA
ALL ENTERPRISE FUNDS
COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN RETAINED EARNINGS
FOR THE YEAR ENDED SEPTEM 3ER 30, 1999
ci
Golf Course
Airport
Fund
Fund
Totals
REVENUES:
Golf course fees
$ 1,303,653
$ -
$ 1,303,653
Rents
29,103
118,226
147,329
Other revenue
22,243
4,039
26,282
am
Total revenue
1,354,999
122,265
1,477,264
Operating expenses:
Salaries, wages and employee benefits
182,803
21,613
264,416
Contractual services, materials and supplies
799,969
18,413
818,382
Depreciation
101,792
40,364
142,156
Amortization
5,077
-
5,077
Total operating expenses
1,089,641
80,390
1,170,031
r.
Operating income
265,358
41,875
307,233
.n
Nonoperating revenues:
Interest income
59,977
12,187
72,164
Interest expense
(102,650)
-
(102,650)
Gain on sale of fixed assets
-
1,000
1,000
Total nonoperating revenues
(42,673)
13,187
(29,486)
Net income
222,685
55,062
277,747
Retained Accumulated earnings deficit), October I g ( )
(13,789)
433,665
419,876
Retained earnings, September30
$ 208,896
$ 488,727
$ 697,623
54
M
D-3
r
CITY OF SEBASTIAN, FLORIDA
ALL ENTERPRISE FUNDS
COMBINING STATEMENT OF CASH FLOWS r
FOR THE YEAR ENDED SEPTEMBER 30,1999
Golf Course
Airport
Fund
Fund
Totals
_
INCREASE(DECREASE) IN CASH AND CASH EQUIVALENTS
Cash flows from operating activities:
r
Cash received from customers
$ 1,299,708
$
116,953
$ 1,416,661
Cash payments to suppliers for goods and services
(799,380)
(17,880)
(817,260)
Cash payments for employee services
(181,485)
(21,124)
(202,609)
Other operating revenue
51,346
4,039
55,385
Net cash provided by operating activities
370,189
81,988
452,177
r
Cash flows from capital and related financing activities:
Acquisition and construction of capital assets
(40,078)
(49,780)
(89,858)
r
Receipts from capital grants
-
23,627
23,627
Principal paid on revenue bond maturities
(105,000)
-
(105.000)
Interest paid on revenue bonds
(102,650)
-
(102,650)
Proceeds from sale of capital assets
-
1,000
1,000
_
Net cash used in capital and related financing activities
(247,728)
(25,153)
(272,881)
r
Cash flows from investing activities:
Purchase of investment securities
(289,054)
(57,248)
(346,302)
Interest on investments
59,977
12,187
72,164
Net cash used in investing activities
(229,077)
(45,061)
(274,138)
Net increase(decrease) in cash and cash equivalents
(106,616)
11,774
(94,842)
Cash and cash equivalents at October 1
209,469
71,223
280,692
r
Cash and cash equivalents at September 30
$ 102,853
$
82,997
$ 185,850
RECONCILIATION OF OPERATING INCOME TO
r
NET CASH PROVIDED BY OPERATING ACTIVITIES
Operating income
$ 265,358
$
41,875
$ 307,233
r
Adjustments not affecting cash:
Depreciation expense
101,792
40,364
142,156
Amortization
5,077
-
5,077
r
Changes in assets and liabilities:
(Increase) in accounts receivable
(4,120)
(1,273)
(5,393)
Decrease in prepaid expenses
18,845
605
19,450
r
(Decrease) in accounts payable
(18,256)
(72)
(18,328)
Increase(decrease) in compensated absences
689
(168)
521
Increase in accrued wages
629
657
1,286
Increase in deferred revenue
175
-
175
Net cash provided by operating activities
$ 370,189
$
81,988
$ 452,177
55
r
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
Agency Funds
➢ Performance Deposits
56
E-1
1 of 2
ASSETS
Cash and cash equivalents
Equity in pooled investments
Investments
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 cemetary care
Undesignated
Total fund balances
Total liabilities and fund balances
CITY OF SEBASTIAN, FLORIDA
ALL FIDUCIARY FUNDS
COMBINING BALANCE SHEET
SEPTEMBER 30,1999
Police
Pension
Trust Fund
Expendable
Law
Police
Law
Enforcement
Officers'
Cemetary
Enforcement
Education
Pension
Trust
Trust
Trust
$
$ 2,043
$ 1,706
$ 2,233
151,085
--
--
1,828,736
--
--
--
$ 1,828,736
$ 153,128
$ 1,706
$ 2,233
-- 1,706 2,233
1,828,736 -- -- --
-- 153,128
1,828,736 153,128 1,706 2,233 _
$ 1,828,736 $ 153,128 $ 1,706 $ 2,233
57
r
r
r
Trust
Funds
Agency Funds
r Public Safety
General
Employees
Employees
Benefits
Benefits
Performance
Trust
Trust
Deposits
Totals
$ 398
$ 645
$ 350
$ 7,375
1,018
2,633
—
154,736
--
—
—
1,828,736
S 1,416
$ 3,278
$ 350
$ 1,990,847
$ 8 $ 200 $ -
- 129 350
8 329 350
$ 208
479
687
3,939
r — — — 1,828,736
— — — 153,128
1,408 2,949 — 4,357
r
1,408 2,949 — 1,990,160
$ 1,416 $ 3,278 $ 350 $ 1,990,847
Ff 1
E-1
2of2
E-2
CITY OF SEBASTIAN, FLORIDA
ALL EXPENDABLE TRUST FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
FOR THE YEAR ENDED SEPTEMBER 30,1999
Revenues:
Intergovernmental
Contributions
Interest income
Otherrevenues
Total revenues
Expenditures:
Current:
General government
Capital outlay
Total expenditures
Excess (deficiency of
revenues over (under)
expenditures
Other financing uses:
Operating transfers out
Total other financing uses
Excess (deficiency) of revenues
over(under)expenditures
and other financing uses
Fund balances, October 1
Fund balances, September 30
Law
Law
Enforcement
Public Safety
General
Cemetary
Enforcement
Education
Employees
Employee
Trust
Trust
Trust
Trust
Trust
Totals
$ -
$ 42,525
$
$ -
$ -
$ 42,525
-
-
650
-
650
7,297
1,387
60
112
117
8,973
18,100
1,761
2,673
300
2,863
25,697
25,397
45,673
2,733
1,062
2,980
77,845
2,075 808 -
2,162 2,236 7,281
- 56,716 -
- - 56,716
2,075 57,524 -
2,162 2,236 63,997
23,322 (11,851) 2,733
(1,100) 744 13,848
(6,500)
(1,685)
(500) -
- (8,685)
(6,500)
(1,685)
(500) -
- (8,685)
16,822 (13,536) 2,233 (1,100) 744 5,163
136,306 15,242 - 2,508 2,205 156,261
$ 153,128 $ 1,706 $ 2,233 $ 1,408 $ 2,949 $ 161,424
59
CITY OF SEBASTIAN, FLORIDA
PERFORMANCE DEPOSITS FUND
STATEMENT OF CHANGES IN ASSETS AND LIABII,rrIES
SEPTEMBER 30,1999
Performance Deposits Fund
Balance Balance
Beginning End of
of Year Additions Deductions Year
ASSETS
E-3
Equity in pooled investments $ — $ 2,700 $ 2,350 $ 350
Total assets $ — $ 2,700 $ 2,350 $ 350
LIABILITIES
Accounts payable $ — $ 2,304 $ 2,304 $
Refundable deposits — 2,700 2,350 350
Total liabilities $ $ 5,004 $ 4,654 $ 350
THIS PAGE INTENTIONALLY LEFT BLANK
61
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.
62
F-1
CITY OF SEBASTIAN, FLORIDA
SCHEDULE OF GENERAL FIXED ASSETS - BY SOURCES
SEPTEMBER 30, 1999
GENERAL FIXED ASSETS
Land $ 3,067,536
Buildings and structures 2,317,483
Improvement other than buildings 10,877,451
Machinery and equipment 3,295,342
Construction in progress 570,049
Total general fixed assets $ 20,127,861
INVESTMENT IN GENERAL FDCED ASSETS FROM
Federal grants
$ 697,073
State grants
8,760
County grants
105,140
General fund
11,502,120
Law enforcement trust fund
43,203
Cemetery trust fund
119,638
Donations
6,214,680
Sales taxes
1,393,156
Contribution from Proprietary funds
44,091
Total investment in general fixed assets $ 20,127,861
63
F-2
CITY OF SEBASTIAN, FLORIDA
SCHEDULE OF GENERAL FUMD ASSETS BY FUNCTION AND ACTIVITY
SEPTEMBER 30,1999
Improvements
Machinery
Other than
and
Function and Activity
Land
Buildings Buildings
Equipment
Totals
General government:
Legislative
$ -
$ - $ -
S 7,808
$ 7,808
City manager
-
- -
31,519
31,519
a.
City clerk
- -
91,434
91,434
City Attorney
-
- -
4,585
4,585
Finance
-
- -
173,667
173,667
Human Resources
-
- -
8,558
8,558
Growth Management
-
84,426 -
140,391
224,817
Building Department
-
79,902
79,902
Total general government
-
84,426 -
537,864
622,290
Police
9,560
809,441 -
930,411
1,749,412
Total police protection
9,560
809,441 -
930,411
1,749,412
Public works:
Administration/Eng
84,426
121,732
206,158
Building Maintenance
33,971
20,236
56,597
110,804
Central Garage
71,663 -
72,437
144,100
Parks and Recreation
583,992
587,941 95,586
414,320
1,681,839
Roads and Drainage
-
16,484 10,781,865
)1,075,732
11,874,081
Cemetery
272,090
54,966 -
86,249
413,305
Total public works
890,053
835,716 10,877,451
1,827,067
14,430,287
Non -Departmental
2,167,923
587,900 -
-
2,755,823
Total Non -Departmental
2,167,923
587,900 -
2,755,823
Total general fixed assets
allocated to functions
$ 3,067,536
$ 2,317,483 $ 10,877,451
$ 3,295,342
19,557,812
Construction in progress
570,049
Total general fixed assets
$ 20,127,861
64
F-3
CITY OF SEBASTIAN, FLORIDA
SCHEDULE OF CHANGES IN GENERAL FIXED ASSETS
BY FUNCTION AND ACTIVITY
SEPTEMBER 30,1999
General Fixed
General Fixed
Assets
Assets
Function and Activity
10/01/98
Additions
Deletions
09/30/99
General government:
Legislative
$ -
$ 7,808 $
-
$ 7,808
City manager
30,075
2,444
1,000
31,519
City clerk
114,433
1,920
24,919
91,434
City attorney
3,985
600
-
4,585
Finance
91,745
81,922
-
173,667
Human Resources
6,049
2,509
-
8,558
Growth Management
235,646
2,195
13,024
224,817
Building Department
46,018
33,884
-
79,902
Total general government
527,951
133,282
38,943
622,290
Police administration
1,561,995
214,773
27,356
1,749,412
Total police protection
1,561,995
214,773
27,356
1,749,412
Public works:
Administration/Engineering 222,939
1,219
18,000
206,158
Building Maintenance
65,327
47,546
2,069
110,804
Central Garage
147,349
2,828
6,077
144,100
Parks and Recreation
1,676,673
7,665
2,499
1,681,839
Roads and Drainage
10,546,491
1,350,128
22,538
11,874,081
Cemetery
416,149
-
2,844
413,305
Total public works
13,074,928
1,409,386
54,027
14,430,287
Non -Departmental
2,757,823
-
2,000
2,755,823
Total Non -Departmental
2,757,823
-
2,000
2,755,823
Total general fixed assets
allocated to functions
17,922,697
1,757,441
122,326
19,557,812
Construction in progress
-
570,049
-
570,049
Total general fixed assets
$ 17,922,697
$ 2,327,490 $
122,326
$ 20,127,861
Total additions and deletions on this schedule include transfers between functions and activities.
65
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.
66
THIS PAGE INTENTIONALLY LEFT BLANK
67
CITY OF SEBASTIAN, FLORIDA
GENERAL LONG-TERM DEBT ACCOUNT GROUP
SCHEDULE OF GENERAL LONG-TERM OBLIGATIONS
SEPTEMBER 30,1999
Public Paving
Improvement Note Compensated
Bonds Payable Absences
AMOUNTS AVAILABLE AND TO BE PROVIDED
FOR THE RETIREMENT OF GENERAL LONG-
TERM OBLIGATIONS
Amount available for debt service
Amount to be provided for retirement of general
long-term obligations
Totals
GENERAL LONG-TERM OBLIGATIONS
PAYABLE
Compensated absences
Roadway improvement note -payable
Revenue bond payable
Totals
G-1
Totals
$ 23,564 $ — $ — $ 23,564
262,957
3,111,041
301,063
3,675,061
$ 286,521
$ 3,111,041 $
301,063
$ 3,698,625
$ — $ — $ 301,063 $ 301,063
3,111,041 — 3,111,041
286,521 — — 286,521
$ 286,521 $ 3,111,041 $ 301,063 $ 3,698,625
THIS PAGE INTENTIONALLY LEFT BLANK
69
STATISTICAL SECTION
The Statistical Schedules differ
statement presentations because
data for more than one fiscal year
accounting data such as social
financial trends of the City.
from the other financial
they generally disclose
They also present non -
and economic data and
70
TABLE
1 of
CITY OF SEBASTIAN, FLORIDA
GENERAL GOVERNMENTAL EXPENDITURES
& OTHER FINANCING USES BY FUNCTION
LAST TEN FISCAL YEARS
a
Fiscal
General
Public
Public
Debt
Year
Government
Safety
Works
Service
1990
$ 906,482
$ 1,372,268
$ 1,022,774
$ 19,999 '
1991
1,012,129
1,505,871
1,171,374
1.3,657
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
1,944,089
1,706,546
1,543,487
214,175
1998
1,439,181
1,842,266
2,006,966
211,956
1999
1,684,151
2,122,823
1,908,915
386,183
(1)
Includes general, special revenue, and debt service funds.
(2)
Operating Transfers Out - Capital Projects Funds established to
receive transfers out.
71
TABLE I
2 uf'_
Capital
Operating
Outlay
Transfers Out Total".
S 659,270
S S 3,980,793
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
1,915.620
1,861,364 (2) 9,879,056
72
TABLE 2
1 of'_
Fiscal
Year
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
CITY OF SEBASTIAN, FLORIDA
GENERAL GOVERNMENT ALL REVENUES & OTHER FINANCING SOURCES
LAST TEN FISCAL YEARS
Licenses
and
Inter-
Charges for
Taxes
Permits
Governmental
Services
S 2,121,812
S 372,032
S 579,760
5 37,230
3,195,204
265,769
756,113
19,926
3,648,151
257,032
710,286
8,717
3,901,663
287,660
782,896
92,611
4,230,835
347,786
934,210
166,095
4,486,685
278,618
961,887
82,653
4,931,996
321,149
1,166,881
74,657
5,250,861
345,463
1,332,676
84,051
5,612,313
388,936
1,366,428
51,196
3,800,242 i3i
448.928
3.600,474 (3)
33,097
(1) Includes general, special revenue and debt service funds.
(2) No Special .Assessments for these tears.
(3) Local Option Gas Tax and Discretionary Sales Tax previously classified as taxes. The Citv does
not collect these taxes. but receives them from the State. Therefore. not included in Taxes.
(4) Capital Projects and additional Special Revenue Funds established in Fiscal Year 1999
resulting in Operatin Transfers In.
73
Interest and
Special
Fines
Other Revenues
Assessments
$ 67,660
$ 421,451
$ (2)
50,250
348,619
(2)
54,304
232,409
(2)
59,640
347,715
(2)
57,257
205,169
(2)
67,774
441,312
174,060
82,477
417,495
135,336
59,198
461,249
68,474
71,194
510,007
30,522
89,697
314,910
44,964
74
Operating
Transfers In
278,855 (4)
TABLE 2
2 of 2
Total(')
$ 3,599,945
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
TABLE3
1 of
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 Lev�tl
1990
$ (2)
$ 1,658,583
(2)
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%
Source: Indian River County Property Appraiser and Tax Collector
(1) Does not include penalties and interest on delinquent taxes.
(2) Information is not available.
75
m
do
m
am
•
m
m
m
TABLE 3
2 of 2
Percent of
Delinquent
Total Tax
Tax
Total Tax
Collections
Collections(t)
Collections(i)
to Tax Levy
$ (2)
$ 1,658,581
(2)
(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 %
76
TABLE 4
1 of 2 ,.
CITY OF SEBASTIAN, FLORIDA _
ASSESSED AND ESTIMATED ACTUAL VALUE OF PROPERTY"'
LAST TEN FISCAL YEARS
Real Property
Personal Property
_
Fiscal
Assessed
Estimated
Assessed
Estimated
Year
Value
Actual Value
Value
Actual Value
1990
(2)
(2)
(2)
(2)
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
30,303,892
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
Source:
Indian River County Property Appraiser
(1) Total assessed value based on approximately 80 percent of estimated actual value
(2) Amounts not available
77
TABLE 4
2 of 2
Ratio of Total
Exemptions
Total
Assessed Value
Real
Assessed
Estimated
To Total Estimated
Property
Value
Actual Value
Actual Value
(2)
(2)
(2)
(2)
$ 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%
iv
TABLE 5
CITY OF SEBASTIAN, FLORIDA
PRINCIPAL TAXPAYERS
SEPTEMBER 30,1998
Taxpayer Type of Business
Bellsouth Communications Utility/Telephone
Wal-Mart Stores Inc.
Retail
Florida Power & Light
Utility/Electric
Lynch, Robert N. (Bishop)
Citrus
Park Place MBP Ltd
Sales/Rental
Grace's Landing Ltd
Rentals
Falcon Cable Media
Cable/Utility
Winn Dixie Stores Inc.
Retail
Sebastian Center Ltd
Rentals
Ringhaver Equipment
Equipment Dealer
(1) Latest information available.
1998 (" Percentage of
Assessed
Total Assessed
Valuation
Valuation
$ 7,930,440
1.18%
7,843,080
1.17%
6,448,890
0.96%
3,665,790
0.55%
2,737,650
0.41%
2,111,580
0.31%
1,618,367
0.24%
1,586,073
0.24%
1,316,420
0.20%
780,155
0.12%
79
TABLE 6
CITY OF SEBASTIAN, FLORIDA
PROPERTY TAX RATES
.. DIRECT AND OVERLAPPING GOVERNMENTS
LAST TEN FISCAL YEARS
City of Sebastian
Indian River County School Board
Debt
Total
Total
Debt
Total
Fiscal
Operating
Service
City
County«"
Operating
Service
School
Year
Millage
Millage
Millage
Millage
Millage
Millage
Millage
Other( )
1990
6.4400
-
6.4400
7.14860
(3)
(3)
8.07040
2.00877
1991
6.5000
-
6.5000
6.77230
(3)
(3)
8.32080
2.16825
r�
1992
6.6230
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)
M
(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
M
an
80
am
TABLE 7
CITY OF SEBASTIAN, FLORIDA
SPECIAL ASSESSMENTS BILLINGS AND COLLECTIONS
LAST TEN FISCAL YEARS
Special
Special
Fiscal
Assessments
Assessments
Year
Billings
Collected')
1990
(3)
(3)
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 tz)
64,823
(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.
Ell
CITY OF SEBASTIAN, FLORIDA
COMPUTATION OF LEGAL DEBT MARGIN
SEPTEMBER 30,1999
Assessed valuations:
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
$ 3,397,562
(286,521)
TABLE 8
$ 438,523,516
187,751,454
$ 626,274,970
$ 62,627,497
3,111,041
$ 59,516,456
TABLE 9
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.
TABLE 10
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.
83
..
•
m
CITY OF SEBASTIAN, FLORIDA
COMPUTATION OF DIRECT AND OVERLAPPING BONDED DEBT
GENERAL OBLIGATION BONDS
SEPTEMBER 30,1999
The City of Sebastian has no overlapping bonded debt or general bonded debt.
84
101-34091
TABLE 12
CITY OF SEBASTIAN, FLORIDA
REVENUE BOND COVERAGE
GOLF COURSE BOND
LAST TEN FISCAL YEARS.
Fiscal
Gross
Debt Service Requirements
Year
Revenues(l)
Principal
Interest
Total
Coverage
1990
$ 1,201,660
$ 30,000
$ 177,528
$ 207,528
c2)
5.79
1991
1,187,071
35,000
174,850
209,850
(Z)
5.66
1992
1,186,570
—
84,437
84,437
(3)
14.05
(4)
1993
1,133,014
80,000
126,655
206,655
5.48
(4)
1994
1,178,975
80,000
123,855
203,855
(3)
5.78
(4)
1995
1,139,795
85,000
120,655
205,655
(3)
5.54,
(4)
1996
1,213,952
90,000
116,830
206,830
(3)
5.87
(4)
1997
1,356,609
95,000
112,600
207,600
(3)
6.53
(4)
1998
1,351,368
100,000
107,850
207,850
(3)
6.50
(4)
1999
1,414,976
105,000
102,650
207,650
(3)
6.81
(4)
Note:
(1) Total of operating revenues and non -operating revenues.
(2) Golf Course Bond, Series 1985.
(3) Golf Course Bond, Series 1985 refunded in 1992 with Series 1992
(4) Required coverage is 1.0.
!
!
!
!
!
!
!
!
85 !
TABLE 13
CITY OF SEBASTIAN, FLORIDA
DEMOGRAPHIC STATISTICS
LAST TEN FISCAL YEARS
Fiscal
School
Unemployment
Year
Population(1)
Enrolhnent(Z)
Rate(3)
1990
10,248
1,187
10.0%
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
9.4%
1996
13,967
1,313
9.5%
1997
14,470
1,324
8.4%
1998
15,115
1,410
8.1%
1999
15,707
(4)
(4)
Date Sources
(1) Bureau of Economics & Business Research University of Florida
(2) School District
(3) State Department of Labor
(4) Information has not yet been published for this area.
m
TABLE 14
1 of 2
CITY OF SEBASTIAN, FLORIDA
PROPERTY VALUE, CONSTRUCTION AND BANK DEPOSITS
LAST TEN FISCAL YEARS
..
Property Value (1)
Fiscal
Year
Commercial
Residential Exempptions
Total
1990
$ 1,941,713
$ 28,607,380 $ 261,761
$30,810,854
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
(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.
87
Commercial
Residential
Construction (2)
Construction (2)
Number of
Number
of
Units
Value*
Units
Value*
7
$ 48,944
125
$ 256,523
3
31,533
280
180,660
6
34,048
240
168,737
— 4
27,517
267
179,122
0
46,305
351
233,502
10
23,192
238
179,816
9
30,621
240
183,177
11
42,111
335
216,196
0
42,628
276
223,511
- 11
46,236
282
248,702
TABLE 14
2 of 2
Bank
Deposits131*
$ 162,256
184,941
256,184
252,032
308,643
318,583
331,765
293,368
312,097
(4)
4.1
TABLE 15
CITY OF SEBASTIAN, FLORIDA
MISCELLANEOUS STATISTICS
SEPTEMBER 30,1999
Date of Incorporation 1924
Form of Government Council/Manager
Number of employees (excluding police and fire): 108
Classified 143
Exempt 26
Area in Square Miles 13.5
Name of Government facilities and services
Miles of streets
140 Miles
Number of street lights
1,156
Culture and Recreation:
Community centers
2
Parks
9
Park acreage
194.38
Golf courses
1
Swimming Pools
0
Tennis courts
6
Police Protection:
Number of stations
1
Number of police personnel and officers
61
Number of patrol units
31
Number of law violations:
Physical arrests
481
Traffic violations
2,413
Parking violations
53
Facilities and services not included in the reporting entity
Fire Protection:
Number of stations
2
Number of fire personnel and officers
9
Number of calls answered
1,443
Number of inspections conducted
43
Sewage System:
Number of service connections
1,250
Water System
Number of service connections
2,630
Number of fire hydrants
443
Education:
Number of elementary schools 2
Number of elementary school instructors 77
Number of secondary schools 2
Number of secondary school instructors 133
89
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.
.o]
M
HOYMAN, DOBSON & COMPANY, P.A.
CERTIFIED PUBLIC ACCOUN IAN I ti
215 Boytree Drive, Suite 1, Melbourne, Florida 32940,321-255-0088, Fax 321-259-8648, w .hayman.com
Charles W. Hayman, Jr
Barbara J. Oswalt
Thomas L. Kirk
Karen E. Kirkland
Deborah A. Bradley
DIRECTOR EMERITUS
Roger Dobson
Eugene K. Bjerning
ft
Cl
Report on Compliance and on Internal Control over
Financial Reporting Based on an Audit of Financial Statements
Performed in Accordance with Government Auditinn 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, 1999, and have issued our report thereon dated December 3,
1999. 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
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 the management of the
City in a separate letter on pages 102-104 dated December 3, 1999.
—92 —
• 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 Town Commission
City of Sebastian, Florida
Page Two
Internal Control Over Financial Renortinq
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. However, we noted other matters involving the internal control over financial
reporting that we have reported to management of the City of Sebastian, Florida in a separate letter
on page 102-104 dated December 3, 1999.
This report is intended for the information of the City Council, management, Federal and State
grantor 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.
male,PHoyman, Dobson & Copany, A.
December 3, 1999
— 93 —
W
..
HOYMAN, DOBSON &COMPANY, P.A.
- CERTIFIED PUBLIC ACCUU NTANTS
J
215 Boytree Drive, Suite 1, Melbourne, Florido 32940, 321-255-0088, Fox 321-259-8648, w hoymon.com
Report on Compliance With Requirements Applicable
to Each Major Program and Internal Control Over
Compliance in Accordance With OMB Circular A-133
Honorable Mayor and Members of the City Council
City of Sebastian, Florida
Comnliance
Charles W. Hoymcn, Jr
Barbara] Oswalt
Thomas L Kirk
Karen E. Kirkland
Deborah A. Bradley
DIRECTOR EMERITUS
Roger W. Dobson
Eugene K. Blerning
We have audited the compliance of the City of Sebastian, Florida with the types of compliance
. requirements described in the U. S. Office of Manaeement and Budget (OMB) Circular A-133
Comnliance Sunnlement that are applicable to each of its major federal programs for the year
ended September 30, 1999. 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, 1999.
M
• American Institute of Certified Public Accountants • Florida Institute of Certified Public Accountants • SEC Practice Section of the A.I.C.P.A. • CPAmericc International
Honorable Mayor and Members of the City Council
City of Sebastian, Florida
Page Two
Internal Control Over Comaliance
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 for the information of management, 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 3, 1999
—95 —
THE CITY OF SEBASTIAN, FLORIDA
SCHEDULE OF FINDINGS AND QUESTIONED COSTS (CONTINUED)
FOR THE FISCAL YEAR ENDED SEPTEMBER 30,1999
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
r
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
14.219 Community Development Block Grant
66.460 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, 1999
Federal Agency/
State Pass -Through Grantor/
Program Title
U.S. DEPARTMENT OF ENVIRONMENTAL
PROTECTION
Direct Programs:
Pass through State of Florida,
Department of Environmental Protection:
Stornwater management
TOTAL U.S. DEPARTMENT OF
ENVIRONMENTAL PROTECTION
U.S. DEPARTMENT OF HOUSING
& URBAN DEVELOPMENT
Community Development Block Grant
Pass through State of Florida,
Department of Community Affairs
TOTAL U.S. DEPARTMENT OF HOUSING
& URBAN DEVELOPMENT
U.S. DEPARTMENT OF JUSTICE
Direct Programs:
Office of Justice Programs
COPS Fast Grant
Total Direct Programs
Pass through State of Florida,
Local Law Enforcement Block Grant
Local Law Enforcement Block Grant
Total U.S. Department of Justice
TOTAL U.S. DEPARTMENT OF JUSTICE
TOTAL FEDERAL FINANCIAL ASSISTANCE
Catalog of
Federal
Fed
Domestic
Grant Total
Assistance Grant Identification
Award Program
Grant Period Promin Number
Amount Expenditures
7/22/98 - 11/22/01 66.460 V M708 S 530,000 $ 122,798
11/30195.7/31/99 14.219 96DB-lE-1040-02-006
5/1196- 11/30/01 16.580 95CFW0682
6/1/97 - 5/31/99 16.592 97CMWX0541
10/1/97 - 9/30/99 16.592 99-CJ-A2-10-40-02-125
530,000 122,798
600,000 191,226
600,000 191,226
300,000 60,395
300,000 60,395
42,525 42,525
10,000 —
52,525 42,525
352,525 102,920
S 1,482,525 S 416,944
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.
97
HOYMAN, DOBSON & COMPANY, P.A.
CERTIFIED PUBLIC nc.-CUTJNIANIS
�w 215Baytree Drive, Suite 1, Melboume, Florida 32940,321-255-0088, Fax 321-259-8648, www.hoymon.com
all
M
Charles W. Hayman, Jr
Barbara J. Oswalt
Thomas L. Kirk
Karen E Kirkland
Deborah A. Bradley
DIRECTOR EMERITUS
Roger W. Dobson
Eugene K. Blaming
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 agreement(s) applicable to the State grants
and aids appropriations identified on the Schedule of State Financial Assistance for the year ended
September 30, 1999 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, 1999 is fairly stated, in all
material respects.
* rrwmjay40vc 5 eoruv*to,P, 4.
Hoyman, Dobson & Company, P.A.
December 3, 1999
an
No _
• American Institute of Certified Public Accountants • Florida Institute of Certified Public Accountants • SEC Practice Section of the A.I,C,P.A. • CPAmerica International
TIIIS PAGE )INTENTION
AI"LYLEFT$LA
NX
99
I
1
I
i
I
1
I
I
T
-
-
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, 1999.
-
2errence R. ore
City Manager
February 16, 2000
-
-
-
-
100
-
CITY OF SEBASTIAN, FLORIDA
SCHEDULE OF STATE OF FLORIDA FINANCIAL ASSISTANCE
YEAR ENDED SEPTEMBER 30, 1999
State Agency
and
Progam Title
DEPARTMENT OF COMMUNITY AFFAIRS
Community Development Block Grant
Bureau of Community Assistance
Local Law Enforcement Block Grant
Local Law Enforcement Block Grant
Total Bureau of Community Assistance
Total Department of Community Affairs
DEPARTMENT OF ENVIRONMENTAL
PROTECTION
Storrnwater Management Program
Florida Recreation Assistance Program
Total Department of Environmental Protection
DEPARTMENT OF TRANSPORTATION
Joint Participation Agreement with Florida
Department of Transportation Aviation
Administration:
Fuel Tank Replacement
Total Department of Transportation
TOTAL STATE FINANCIAL ASSISTANCE
Federal
Federal Through
State Contract/ CFDA State State
Grant Number Number Receipts Receipts
96DB-1E-1040-02-006 14.219 $ —
97CMWX0541 16.592 —
99-CJ-A2-1040-02-125 16.592 —
WM708 66.460 —
F99136 8,760 (1)
8,760
Total
Receipts
S 222,196 S 222,196
42,525 42,525
10,000 10,000
52,525 52,525
274,721 274,721
146,201 146,201
— 8,760
146,201 154,961
404755-1-94-01 23,627 (I) —
23,627 —
S 32,387 S 420,922 S
(1) State Grant and Aids Appropriations moneys. The total of State Grants and Aids Appropriations moneys is 532,387.
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23,627
23,627
453,309
M
HOYMAN, DOBSON & COMPANY, P.A.
CERTIFIED PUBLIC ACCOUNTANTS
.Aw'.
215 Eloytree Drive, Suite 1, Melbourne, Florida 32940,321-255-0088, Fox 321-259-8648, w .hoymon.com
Independent Auditor's
Management Letter Comments
Honorable Mayor and Members of City Council
City of Sebastian
Sebastian, Florida
Charles W. Hayman, Jr
Barbara J. Oswalt
Thomas L. Kirk
Karen E. Kirkland
Deborah A. Bradley
DIRECTOR EMERITUS
Roger W. Dobson
Eugene K Bjerning
We have audited the general purpose financial statements of the City of Sebastian, Florida, as of
September 30, 1999 and for the year then ended, and have issued our report thereon dated
December 3, 1999. 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:
1. Police Pension
Fes: GASB Statement 27, which was implemented in fiscal year 1997, requires the
Pension Board to have a biennial actuarial valuation. The City met the requirement in the
current year by having an actuarial valuation by October 1, 1999 but the Pension Board still has
not approved a change to biennial valuation.
Recommendation: To ensure future compliance with GASB Statement 27, the Pension
Board will need to approve a biennial actuarial valuation.
2. Fixed Assets
We noted the following items related to fixed assets:
a) Determination of Obsolete or SUCDIUS Personal Proaerty
Finding: Section 2-93 of the Sebastian Code requires the City Manager to determine the
personal property owned by the City that is no longer needed or obsolete. In December 1998,
numerous items were sold by auction; however, there is no documentation to demonstrate that
the City Manager approved the items for disposal.
—102 —
• 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
2. Fixed Assets (continued)
Recommendation: We recommend that management keep documentation to demonstrate that
the City Manager determined and approved the items to be sold. A memo to the file from the
City Manager would be sufficient.
b) Disposal of General Fixed Assets
Findin : Section 2-93 of the Sebastian Code requires City Council approval prior to the sale
of personal property with a depreciated value in excess of $4,000. Depreciated value is
defined as the original cost of the asset less any associated depreciation, or simply, the net
book value of the asset. However, general fixed assets are not subject to depreciation. In
December 1998, five items auctioned had a depreciated value in excess of $4,000.00 but no
Council approval for the sale of these items is apparent in the Council's minutes.
Recommendation: We recommend management and Council clarify whether "depreciated
value" was intended to imply the net book value, fair market value, or some other value. Once
the intended meaning is determined, the code should be amended to reflect the chosen
meaning. We recommend that Council record in the minutes when their approval for items to
be sold or exchanged.
c) Fixed Asset Detail
Findin : The City's fixed asset record keeping could be improved to provide more
information and be more computerized.
Recommendation: The City should review the tracking methods used for fixed assets and
look into purchasing a fixed asset tracking software program.
3. EPA Grant Administration
Finding: We noted a lack of communication between Departments in the administration of
the EPA grant. As a result there were some immaterial instances of noncompliance with
some of the grant requirements.
Recommendation: We recommend the City consider having someone in the Finance
Department verify and document that all grant requirements are being met.
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Honorable Mayor and Members of the City Council
City of Sebastian, Florida
Page Three
Status of Prior Year Audit Findings:
The status of audit findings for the year ended September 30, 1999 are as follows:
Management Letter Status
1 Police Pension Repeated, Revised
2 Budgetary Compliance 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, 1999.
The City of Sebastian is not in a state of financial emergency as a consequence of conditions in
Section 218.503(1), Florida Statutes.
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)(0.
This report is intended solely for the use of the City Council, Management, Federal and State
grantor agencies, and the Office of the Auditor General and is not intended to be and should not be
*� used by anyone other than those specified parties.
P. A
Hoyman, Dobson & Company, P.
December 3, 1999
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105
.. QQCI 0�
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City of Sebastian
1225 MAIN STREET ❑ SEBASTIAN, FLORIDA 32958
.. TELEPHONE (561) 589-5330 ❑ FAX (561) 589-5570
February 16, 2000
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 1998-1999 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. F.S. 185.221 (2) requires an actuarial valuation at least every three years,
however, 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. A letter has been prepared
outlining the above and has been sent to the Police Pension Board for compliance.
2.a. Determination of Obsolete or Surolus Personal Propertv
Section 2-93 of the Code of Ordinances does not provide procedures for how the City
Manager is to authorize the disposal of personal property that is no longer needed or
is obsolete. Insofar as the Code is silent on the matter, the recommendation by the
Auditors will be put in place as a policy requiring written determination and
authorization to dispose of obsolete personal property.
2.b. Disposal of General Fixed Assets
In conjunction with 2(a) above, policies will be established to comply with the
ordinance regarding the disposal of assets. In addition, though general fixed assetare
generally not depreciated in the financial records of municipalities, it is common
_ practice upon disposal to treat those assets as if they were depreciated in the fund to
which they belong.
106
a
Also, to clarify the term `depreciated value' an amendment to the City code will be
brought forward to Council recommending `depreciated value' to mean asset cost
less depreciation to date of disposal as if depreciation had been taken.
2.c. Fixed Asset Detail
The fixed asset detail is maintained in a database format on an annual basis. The type
of information maintained and the supporting documentation, i.e. fixed asset cards,
disposal information, etc., does not provide, in accordance with good record keeping
practices, the necessary detail on a year to year basis to maintain good fixed asset
records. The Finance department is in the process of evaluating Governmental Fixed
Asset Accounting Software that will provide the record keeping capabilities
necessary to maintain the assets of the City in a consistent manner.
3. EPA Grant Administration
The Finance department has initiated a policy of filing all grant reports and preparing
the necessary invoices to draw down funds in support of grant associated projects.
By complying with this process, the Finance department will review the compliance
with grant provisions and insure that the grant requirements are being met.
Since ely,
Terrence R. oore
City Manager
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