HomeMy WebLinkAbout2006 - 2007CO N~ A
1
1
1
1
1
1
1
' For the Fiscal Year October 1, 2006 through September 30, 2007
1
The City of Sebastian Elementary School opened in 1927
The City of Sebastian Elementary School opened in 1927. It
served as an elementary school until 1982, when the City of
Sebastian administration offces offccially moved in. In August
2001, the building was listed as a National Historic Place. In
August 2002, the City entered into a grant agreement with the
Division of Historical Resources which provided $250,000 to
help pay for building renovations.
In September of 2007, renovations were completed and included
installing an elevator, making restrooms accessible for the
disabled, repairing the roof, re-carpeting and re-finishing all
floors, and re painting the entire inside of the building. The
total cost of this project was $957,000.
This historic building is now home to Indian River Community
College, the Sebastian Area Historical Museum and the Abilities
Resource Center.
1
II
~ CITY OF
~ SEBASTIAN, FLORIDA
1
1
1
1
1
~~
Comprehensive Annual Financial Report
' For the Year Ended September 30, 2007
CITY COUNCIL
' Andrea B. Coy ....................................Mayor
Sal Neglia ............................................. Vice-Mayor
' Al Paternoster .....................................Councilmember
Dale I. Simchick ................................. Councilmember
' Eugene Wolff .......................................Councilmember
0
t
Prepared By: Finance Department
HOME OF PELICAN ISLAND
i
CITY OF
~~,«.
~~ 1. J/ ~ 1
'""~-'~Y
HOME OF PELICAN ISLAND
THIS PAGE INTENTIONALLY LEFT BLANK '
1
1
1
1
1
1
1
INTRODUCTORY SECTION
This section contains the following subsections:
- Table of Contents
- Letter of Transmittal
- Certificate of Achievement for Excellence in Financial
Reporting for the Fiscal Year Ended September 30,
2005
- Organizational Chart
- List of Officials
1
CITY OF SEBASTIAN, FLORIDA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
SEPTEMBER 30, 2007
TABLE OF CONTENTS
INTRODUCTORY SECTION Page
Table of Contents ................................................_........................................................................................ ii
Letter of Transmittal ...................................................................................................................................... v
Certificate of Achievement for Excellence in Financial Reporting............_ ...................................._........... ix
Organizational Chart ...................................................................................................................................... x
List of Officials .............................................................................................................................................. xi
FINANCIAL SECTION
hidependen[ Auditors' Report ................................................................................................................... .... 3
Management's Discussion and Analysis .............................................................................................._.... .... S
Basic Financial Statements
Government-wide Financial Statements:
Statement of Net Assets ...................................................................................................................... .... 15
Statement of Activities ....................................................................................................................... .... l6
Fund Financial Statements:
Balance Sheet-Governmental Funds ..................................................._........................................... ._. L8
Statement of Revemtes, Expenditures, and Changes in Fund Balances -
Governmental Funds ....................................................................................................................... .... 20
Reconciliation of the Statement of Revenues, Expendihves, and Changes in Fund Balances
of Governmental Funds to the Statement of Activities ................................................................... .... 22
Statement of Net Assets -Proprietary Funds ..................................................................................... .... 23
Statement of Revenues, Expenses, and Changes in Fund Ne[ Assets -Proprietary Funds ................ .... Z4
Statement of Cash Flows -Proprietary Funds ._ ..........................................._................................... .... 25
Statement of Fiduciary Net Assets -Fiduciary Funds ........................................................................ .... 27
Statement of Changes in Fiduciary Net Assets -Fiduciary Fund _ .................................................... .... 28
Notes to Financial Statements ............................................................................................................... .... 29
Required Supplementary Information:
Schedule of Revenues, Expenditures, and Changes in Fund Balances -Budget and
Achtal -General Fund ........................................................................................................................ .... 52
Schedule of Revenues, Expendihves, and Changes in Fund Balances -Budget and
Actual -Discretionary Sales Tax Special Revenue Fund ..............................................._............_.... .... 53
Schedule of Revenues, Expenditures, and Changes in Fund Balances -Budget and
Actual - Riverfront Redevelopment Agency Special Revenue Fund ................................................. .... 54
Notes to the Required Supplementary Information -Budget Comparisons .......................................... .... 55
Police Officers' Pension Plan -Schedule of Contributions from the Employer and other
Contributing Entities ..............................................................._......................................__.........._.... .._ 56
Combining and Individual Fund Statements and Schedules
Combining Balance Sheet -Nonmajor Governmental Funds ........................... _..._................................. ._. 60
Combining Statement of Revenues, Expendihves, and Changes in Fund Balances -Nonmajor
Governmental Funds .............................................................................................................................. __ 64
Schedule of Revenues, Expendihires, and Changes in Fund Balances -Budge[ and
Actual -Local Option Gas Tax Special Revenue Fund ......................................................................... .... 68
Schedule of Revenues, Expenditures, uid Changes in Fund Balances -Budget and
Ach~al -Recreation Impact Fee Special Revenue Fund ........................................................................ .... 69
Schedule of Revenues, Expendihves, and Changes in Fund Balances -Budget and
Actual - Stormwater Utility Special Revenue Fund ........................................................._............._.... .... 70
Schedule of Revenues, Expendihves, and Changes in Fund Balances -Budget and
Actual -Law Enforcement Forfeihu'e Special Revenue Fund ........................................._.................... .... 7l
Schedule of Revenues, Expenditures, and Changes in Fund Balances -Budget and
.Actual - G.R.E.A.T. Program Special Revenue Fund ......................................................._._.___.._.... _.. 7l
LI
1
t
LJ
1
1
'
h
l P;tee
Sc
edu
e of Revenues, Expenditures, and Changes in Fund Balances -Budget and
Achtal - Stormwater Utility Revenue Bonds 2003 Debt Service Fund .................................................. ... 72
Schedule of Revenues, Expenditures, and Changes in Fund Balances -Budge[ and
' Actual -Discretionary Sales Surtax Revenue Bonds 2003 Deb[ Service Fund ...................................._ ... 73
Statement of Changes in Assets and Liabilities -Agency Fund ........................................._._................... ... 74
Capital Assets Used in the Operation of Governmental Funds -Comparative
' Schedule by Source ......................................................................:.......................................................... ... 75
Capital Assets Used in the Operation of Governmental Funds -Schedule
by Function and Activity ........................................................................................................................ ... 76
Capital Assets Used in the Operation of Governmental Funds -Schedule of Changes
' by Function and Activity ........................................................................................................................ ... 77
STATISTICAL SECTION (Unaudited)
t Financial Trends
Net assets by Component -Last Seven Fiscal Years ............................................................................ ... 80
Changes in Net Assets -Last Seven Fiscal Years ....................................................................__...._._ ... 82
' Fund Balances, Governmental Funds -Last Ten Fiscal Years .............................................................. ... 86
Changes in Fund Balances, Governmental Funds -Last Ten Fiscal Years ........................................... ... 88
Program Revenues by Function,~Program -Last Seven Fiscal Years ..............................................._... ... 90
Revenue Capacity
' Tax Revenues by Source, Governmental Funds -Last Ten Fiscal Years ............................................. ... 92
Property Tax Rates, Direct and Overlapping Governments -Last Ten Fiscal Years ............................ ... 93
Assessed Valuation and Estimated True Values of Taxable Property -Last Ten Fiscal Years ............ ... 94
' Principal Taxpayers -Year 2007 and Year 1998 ................................................................................... .. 96
Property Tax Levies and Collections -Last Ten Fiscal Years ............................................................... .. 97
Debt Capacity
Ratios of Outstanding Debt by Type -Last Ten Fiscal Years ................................................................ .. 98
' Computation of Legal Debt Margin -September 30, 2007 .........................................._.................._._. .. 99
Direct and Overlapping Governmental Activities Debt, General Obligation Bonds -
September 30, 2007 ............................................................................................................................ .. 99
' Ratios of General Bonded Debt Outstanding and Legal Debt Margin -Last Nine Fiscal Years ........... .. l00
Pledged Revenue Coverage -Last Ten Fiscal Years ..........................................._................................. .. l02
Economic and Demographic Information
Demographic and Economic Statistics -Last Ten Years ............................................_........................ ... 104
' Principal Employers -Year 2007 and Eight Years Ago ........................................................................ ... 106
Operating Information
Full-time Equivalent City Government Employees by Fwiction/Program -Las[ Ten Fiscal Years ..... ... 107
' Operating Indicators by Function/Program -Last Nine Fiscal Years ................................................... ... 108
Capital Asset Statistics by Function/Program -Last Nine Fiscal Years ... I09
' SINGLE AUDIT SECTION
Independent Auditors' Report on Internal Control Over Financial Reporting and on Compliance
and Other Matters Based on an Audit of Financial Statements Performed in Accordance with
Governmental Auditing Standards ................................................_........................................................ ._ l l3
' Independent Auditors' Report on Compliance and [ntemal Control Over Compliance to Each
Major S[a[e Project .................................................................................................................................. ... 1 t5
Schedule of Findings and Questioned Costs -State Projects ................................._................................._ ... 117
t Schedule of Expenditures of State Financial Assistance ..........................._............................................... ... 118
Notes to Schedule of Expenditures of State Financial Assistance .............................................................. ... 119
Independent Auditors' Management Letter ................................................................................................ ... 121
' Response to Independent Auditors' Management Le[[er ...................................._...................................... ... 123
' 111
GTY Of
~,
srq.~~;f<<;
-- - ~ ~.~~
- ---
- X ,..r
' ..... .:
HOME OF PELICAN ISLAND
THIS PAGE INTENTIONALLY LEFT BLANK
IV
t
1
G1Y OF
1 S~~T~V
' HOME OF PELICAN ISLAND
1225 MAIN STREET • SEBASTIAN, FLORIDA 32958
TELEPHONE: (772) 589-5330 • FAX (772) 589-5570
t
' February 28, 2008
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, 2007, as prepared by the City's Finance department. State law requires
' that every general-purpose local government publish within six months of the close of each fiscal year a
complete set of audited financial statements. This report is published to fulfill that requirement for the
fiscal year ended September 30, 2007.
' Management assumes full responsibility for the completeness and reliability of the information
contained in this report, based on a comprehensive framework of intemal control that is established for
this purpose. Because the cost of internal control should not exceed anticipated benefits, the objective is
' to provide reasonable, rather than absolute, assurance that the financial statements are free of any
material misstatements.
' Chapter 218.39, Florida Statutes requires that the financial statements of the City of Sebastian be audited
by a certified public accountant selected by the City Council. The City's independent Certified Public
Accountants, Harris, Cotherman, Jones, Price & Associates, has issued an unqualified ("clean') opinion
' on the City of Sebastian's financial statements for the year ended September 30, 2007. The independent
auditors' report is located on page 3 and 4.
' Management's discussion and analysis (MD&A) immediately follows the independent auditors' report
and provides a narrative introduction, overview, and analysis of the basic financial statements. The
MD&A complements this letter of transmittal and should be read in conjunction with it.
' Profile of the Govemment
The City of Sebastian, Florida is located in Indian River County approximately midway through the east
coast of the Florida Peninsula (between Melbourne and Vero Beach) in an area known as the Treasure
Coast. It is recognized as the Home of Pelican Island, the first designated wildlife refuge in the United
' States, a Millennium City, and a Tree City USA.
The City of Sebastian was first incorporated as the Town of Sebastian in 1924. In the late 1950s General
Development Corporation purchased the land from the Mackle family of Miami and began the
development of a planned community that is now the City of Sebastian. The City has a population of
22,426 living in an area of approximately 14.6 square miles. The City is empowered to levy a property
' tax on both real and personal property located within its boundaries. It also is empowered by state
statute to extend its corporate limits by annexation, which it has done from time to time.
' v
The City is a Florida municipal corporation with alive-member City Council. Comicil members serve a
two-year teen. Annual elections are held on the second Tuesday in November and two members are
elected in even-numbered years and tluee members are elected in odd-numbered years. Elections are
non-partisan and at-large. Yfayor and Vice Mayor are elected from among the members of every newly
seated Council at a Special meeting following the election each year. The City has operated under a
Council-City Manager form of govercnnent since 1989.
The City provides a wide range of services including general government administration, police
protection, the construction and maintenance of local roads, public works, recreational and cultural
activities, a golf course, a general aviation airport, and a building department to enforce building codes.
This report includes all funds of the City. In evaluating the City as a reporting entity, we have included
all component units for which the City Council is financially accountable. The component units have
been blended with the financial statements presented for the Primary Govemment because the
component tulit's governing body is the same as the City Council or because the component unit
exclusively serves the City. The blended component units are the Riverfront Redevelopment Agency
acid the Sebastian Police Officer's Pension Tntst Fumd.
The Council is required to adopt a final budget no later than the close of the fiscal year. This annual
budget serves as the foundation for Che City's financial planning and control. The budget is prepared by
fund, function (e.g., transportation), and department (e.g., public works). Shifts in appropriations within
fund totals may be done administratively on the authority of the City Manager. Total fiord appropriation
changes and use of contingency appropriations must be approved by the City Council
T oral Economy
The region (which includes the City of Sebastian and the sun~ounding unincorporated area within the
same county) has a fluctuating labor farce depending on agricultural demand and a strong retirement
community. Although the labor force fluctuates, unemployment in the region has been between 4% and
7.9% over the past ten years. Retail sales and the service industries remain the largest sectors of
employment in the Sebastian area. The historical overall unemployment rate for the area over the past
ten years and the projected unemployment rate for the next ten years are greater than that of the State of
Florida. This high number indicates that the influx of residents to the area continues to outpace job
creation. According to the U.S. Census Bureau (2000), 86% of the population age 25 or older are high
school graduates and 23.1% hold a bachelor's degree or higher. The geographical area of the City of
Sebastian, just north of the Treasure Coast, houses a number of high-tech industries including NASA
and various aerospace indushy-related businesses. This attracts a workforce with a higher than average
education and technical skills to the vicinity. The area median age for 2000 was 49.2 per U.S Census
Bureau and median household income for 2004 was $39,393 per the Florida Research & Economic
Database.
Lone-teen Financial Plarmina
The voters of Indian River County in November 2003 extended the Infrastructure Sales Surtax in the
amount of $.O1 per $1.00 sale for an additional fifteen years and seven months begirming in January
2004. This Infrastructure Sales Surtax is estimated to provide the City in excess of $40 million dollars
over the life of the extension for the City's emergency vehicle and capital improvement needs.
In addition, the City has funded a number of other capital projects with impact fees and is actively
pursuing grant funding for some major transportation and environmental improvements. It has also
employed the use of a Community Redevelopment Agency that is funded by means of tax-increment
financing.
vi
1
t
t
1
1
1
Strong growth in the City tax base has provided the City funding for a high level of services to City
residents and visitors without increasing the property tax millage rate. Property tax revenues increased
9.53%, although the millage was reduced from 3.9325 to 3.019. Construction activity in fiscal year
2007 was not as strong as fiscal year 2006, with 116 permits being issued for constn~ction in fiscal year
2007 with a value of 532.3 million. The decline is pnmarily attributed to the slowdown of the housing
market.
1
1
i
1
Unreserved, undesignated fund balance in the general fiord (42.31% of total general fiord expenditure
budget) exceeds the policy guidelines set by the Council for budgetary and planning purposes (i.e.,
minimum of 25% of total general ftmd expenditure budget). The City is reluctant to spend down these
balances due to uncertainty about the future due to the slow down of building activity and because the
City has no assurance regarding how severe further State mandated reductions to City tax revenues will
be. The State already required a millage reduction and placed a cap on fuhrre increases in ad valorem
taxes. The City has concerns that some of the proposed measures under discussion may result in
revenue reductions that will severely diminish the City's ability to provide the services required by our
residents and visitoa. The budget for next year incorporates reductions in staffing and elimination of
any new capita] equipment in anticipation that expenses will have to be further reduced to deal with
these restricted measures.
Major Initiatives
Stonnwater -The main focus of stormwater effort expended for the past fiscal year has continued to be
on the City's Stormwater Management Program, including capital projects, maintenance, citizen
response and education, and forward planning. In fiscal year 2007, City began a program to upgrade the
current Swale system by installing '/4 rounds. The City also started outsourcing the Swale and ditch
maintenance work to enable City crews to focus on different stormwater maintenance practices.
Traffic & Transportation -The City continues working on a long-term street-resurfacing program for
the next 10 to 15 years. City adminish~ation will also continue to program funding for streetscape
projects to help maintain public safety and beautification efforts. L7 addition, capital improvement
programming for sidewalk installation throughout the City will continue for both the short and long teen
as funding and resources perniit.
Airport -The Sebastian Municipal Airport's infrastructure is being developed to attract economtc
development opportunities that will stimulate the business climate and create jobs in the cotxununity.
The current Master Plan serves as the guiding document for airport planning and a comprehensive
business plan was approved this past year that led to the City Council lifting the previously imposed
moratorium on all land leases. This was important because land leases are a primary sources of airport
revenues. Also important is the construction of a self-serve fueling facility that recently became
operational, which should help diversify the Airport's revenue sources.
The Airport's limited resources continue to be leveraged by aggressively seeking and obtaining grants
available from the Florida Department of Transportation (FDOT) and Federal Aviation Administration
(FAA) to provide the funding needed to develop the necessary infrastructure. Improvements to lighting
and signage have been made, as well as actions to clear vegetation and brush for the purpose of
enhancing security. Construction of a maintenance storage building and installation of security upgrades
were also completed. These and other ventures will help diversify airport revenues, providing for a
stronger enterprise fund that has the potential to increase taxable values.
vii
Public Safety -The Police Department conducted a very successful Citizen's Academy. This new
program was implemented to help citizens understand the functions of a law enforcement agency and
encourage assistance with community issues. It was very encouraging that this first class consisted of
22 students. Another initiative was t91e implementation of the E-911 System that allows the City to
receive all 911 calls directly, rather than being forwarded through the Sheriffs Office. This should
provide a quicker response to all emergencies.
The City continues to sponsor the School Resources Ofticer Program at the two elementary schools
located within the City. hi addition, the Sebastian Police Department K-9 Uivt and the Marine Patrol
that were recently initiated is being continued. The K-9 Unit became possible as a result of numerous
charitable efforts in the community. It is effective in assisting officers with narcotics detection, location
of missing persons and tracking criminal suspects more expeditiously. The Marine Patrol Program was
started with a 50% grant from the Florida Inland Navigational District. It inchides an educational
program as well as enforcement and is well received by most of the boating public.
Awards and Acknowledgements
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a
Certificate of Achievement for Excellence in Financial Reporting to the City of Sebastian for its
comprehensive annual financial report for the fiscal year ended September 3Q ?006. The Certificate of
Achievement is a prestigious national award-recognizing conformance with the highest standards for
preparation of state and local government financial reports. In order to be awarded a Certificate of
Achievement, a government must publish an easily readable and efficiently organized comprehensive
annual financial report. This report musC satisfy both li.S. generally accepted accounting principles and
applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. We believe that our current
comprehensive annual financial report continues to meet the Certificate of Achievement Program's
requirements and we are submitting it to the GFOA to determine its eligibility fox another certificate.
The preparation of this report would not be possible without the dedicated service of the Finance
department staff. Their efforts toward improving the accounting and financial reporting systems has led
to the improved quality of information reported to the City Council, State and Federal agencies and the
citizens of the City of Sebastian. We sincerely appreciate their contributions.
submitted,
Manager
~~~
Kenneth W. Killgore
Director of Finance
viii
1
1
1
1
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Sebastian
Florida
' For its Comprehensive Annual
Financial Report
' for the Fiscal Yeaz Ended
2006
S
t
b
30
er
ep
em
,
' A Certificate of Achievement for Excellence in Financial
Reporting is presented by the Govenuvent Finance Officers
Association of the United States and Canada to
government units and public employee retirement
systems whose comprehensive annual financial
reports (CAFRs) achieve the highest
standards in government accounting
' and financial reporting.
' E ~~~ U
~~
~
.
•
~ ~ President
' ~~ ~~~
G
Executive Director
1
' ix
CITY OF SEBASTIAN, FLORIDA
ORGANIZATIONAL CHART
CITY I
CLERK
POLICE
A UMINIS"I'R;\"1'IOn'
IooL aESOraicE
I20AD 1'A'r120L
COJUIEN]"fY
POLICIn'G
CODE.
ESFORCE\IEn"C
DE"fF.C"1'IVE
suProaT
sravlcEs
Dlsr.crcll
PaoressloN:~L
S"f:1n'DARUS
SPECIAL
OPEIb\'fI0\'S
CITIZENS OF
SEBASTIAN
CITY COUNCIL ~--~ noaaos,~
COMMISSIOSS
CITY C[TY
MANAGER ATTORNEY
FINS\\CE PUBLIC WORKS
nlnuACenle~T
ruroaslcrlon RoaD ~
sYSrEM1I n[AmTEnAncE
HUIDIAN RESOURCES P.Aaxs ~
RECREATION
ENGINEERING cENTaAL cAancE
S1'OI2nIR'ATE12 I CEMETERY
GROWTH M1~IANAGENIENT nmLmnc
nraINTENANCE
BUILDING DEPARTM1'IENT
GOLF COURSE
AIRPORT
X
1
1
II
1 ',
t
1
i
1
1
i
CITY OF SEBASTIAN, FLORIDA
CITY OFFICIALS
City Manager
City Clerl.
Ciry Attorney
AL MINNER
SALLY A. MAID, MMC
RICH STRINGER
DEPARTA'IENT HEADS:
Police Chief
Director of Finance
City Engineer
Public Worls Director
JAMES A. DAMS
KENNETH W.KILLGORE
DAVID W. FISHER, P.E.
JERRY CONVERSE
Growth Management Director
Building Director
Human Resources Director
Golf Course Director
Airport Director
xi
REBECCA GROHALL
WAYNE ESELTEVB
DEBRA KRUEGER
GREG GARDNER
JOSEPH GRIFFIN
t
CITY OF '
SE ., .. ~--~____
~~ , _~
~.
,.: _ ~:~
~~ _~
HOME OF PELICAN ISLAND ,
1
THIS PAGE INTENTIONALLY LEFT BLANK
i
i
1
1
1
X;. ~
1
1
1
1
1
1
1
1
1
FINANCIAL SECTION
This section contains the following subsections:
- Independent Auditor's Report
Management's Discussion and Analysis
Government-wide Financial Statements
- Fund Financial Statements
Notes to Financial Statements
Required Supplementary Information
- Combining and Individual Fund Statements
and Schedules
HOME OF PELICAN ISLAND
THIS PAGE INTENTIONALLY LEFT BLANK
1
1
1
t
1
1
' Harris, Cotherman,
Jones, Price 6i. Associates
Certified Public Accountants -Chartered
1070 North Highway AIA, Suite 250
' Uero Beach, FL 32963
Tel 772.234.8484
Fax 772.234.8488
' Independent Auditors' Report
' Honorable Mayor and Members of City Council
City of Sebastian
Sebastian, Florida
We have audited the accompanying financial statements of the governmental activities, the business-type
activities, each major fund, and the aggregate remaining fund information of the City of Sebastian,
Florida, as of and for the year ended September 30, 2007, which collectively comprise the City's basic
' financial statements as listed in the table of contents. These financial statements are the responsibility of
the City of Sebastian, Florida's, management. Our responsibility is to express opinions on these financial
statements based on our audit.
' We conducted our audit in accordance with auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing Standards,
' issued by the Comptroller General of the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and
' disclosures in the financial statements. An audit also includes assessing the accounting principles used
and the significant estimates made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities, the business-type activities, each major fund,
and the aggregate remaining fund information of the City of Sebastian, Florida, as of September 30, 2007,
' and the respective changes in financial position and cash flows, where applicable, thereof for the year
then ended in conformity with accounting principles generally accepted in the United States of America.
' In accordance with Governmental Auditing Standards, we have also issued our report dated February 21,
2008, on our consideration of the City of Sebastian, Florida's internal control over financial reporting and
on our tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements
' and other matters. The purpose of that report is to describe the scope of our testing of internal control
over financial reporting and compliance and the results of that testing, and not to provide an opinion on
the internal control over financial reporting or on compliance. That report is an integral part of an audit
' performed in accordance with Government Auditing Standards and should be considered in assessing the
results of our audit.
The management's discussion and analysis and the required supplementary information, as listed in the
t table of contents are not a required part of the basic financial statements but are supplementary
information required by accounting principles generally accepted in the United States of America. We
have applied certain limited procedures, which consisted principally of inquiries of management
t regarding the methods of measurement and presentation of the required supplementary information.
However, we did not audit the information and express no opinion on it.
' "Providing Vision and Ditecdon to otu Clients"
Member AICPA Member A1CPA Division For CPA Firms Member FICPA
Private Companies Practice Section
' 3
Harris, Cotherman, '
Jones, Price 6i Associates
Certified Puhlic Accountants - Chareered
Honorable Mayor and Members of City Council
City of Sebastian '
Page two
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively ,
comprise the City of Sebastian, Florida's basic financial statements. The introductory section, combining
and individual nonmajor fund financial statements and statistical tables aze presented for purposes of
additional analysis and are not a required part of the basic financial statements. The combining and ,
individual nonmajor fund financial statements have been subjected to the auditing procedures applied in
the audit of the basic financial statements and, in our opinion, are fairly stated in all material respects in
relation to the basic financial statements taken as a whole. The introductory section and statistical tables '
have not been subjected to the auditing procedures applied in the audit of the basic financial statements
and, accordingly, we express no opinion on them.
Th
e accompanying schedule of expenditures of state financial assistance is presented for purposes of
additional analysis as required by the Florida Single Audit Act; and Chapter 10.550 Rules of the Auditor
General, and is also not a required part of the basic financial statements of the City of Sebastian, Florida.
Such information has been subjected to the auditing procedures applied in the audit of the basic financial '
statements and, in our opinion, is fairly stated, in all material respects, in relation to the basic financial
statements taken as a whole.
}~aw~w, Co4i~um+u~, Qr)w, #3uu ~ Qaeaelsfrs,
C.&rJt~id i~tbJ,e At1.rw,rirtxls- Ch~tndreid '
Harris, Cotherman, Jones, Price & Associates, Chartered '
Certified Public Accountants
February 21, 2008 '
1
1
4
MANAGEMENT'S DISCUSSION AND ANALYSIS
The City of Sebastian's (the "City") discussion and analysis is designed to (a) assist the reader in focusing on
signiftcant financial issues, (b) provide an overview of the City's financial activity, (c) identify changes in the
City's financial position, (d) identify any material deviations from the financial plan, and (e) identify individual
fund issues or concerns.
' Since the Management's Discussion and Analysis (MD&A) is designed to focus on the current years activities,
resulting changes and currently known facts, please read it in conjunction with the Transmittal Letter (beginning
on page v) and the City's financial statements (beginning on page 15).
t
Financial Highlights
HIGHLIGHTS
1
• The assets of the City exceeded its liabilities at the close of Che fiscal year 2007 by $46,908,860 (net
assets). Of this amount, $6,553,884 (unrestricted net assets) may be used to meet [he government's on
going obligations to citizens and creditors.
• The city's total net assets increased by $1,710,985 resulting from an increase of $2,196,440 from
governmental activities and $485,455 decrease from business-type activities
• As of the close of current fiscal year, the City's governmental funds reported combined ending fund
balance of $20,01 1,838, a decrease of $1,906,693 in comparison with the prior year. Approximately 54%
of this amount, $10,745,347, is available for spending at the City's discretion (unreserved, undesignated
fund balance).
• At the end of the current fiscal year, unreserved, undesignated fund balance for the genera] fund was
$5,424,199, or a 17% increase from prior year general fund unreserved and undesignated fund balance.
The key factor in this increase was the elimination of the reserve for capital projects that was established
as a line of credit reserve for the Airport and was scheduled to expire at the end of fiscal year 2007.
USING THIS ANNUAL REPORT
The annual report consists of a series of financial statements. The Statement of Net .Assets and the Statement of
Activities (on pages l5, 16, and l7) provide information about the activities of the City as a whole and present a
longer-term view of the City's finances. Fund financial statements begin on page 18. For governmental
activities, these statements tell how these services were financed in the short term as well as what remains for
fuhtre spending. Fund financial statements also report the City's operations in more detail by providing
information about the City's most significant funds. The remaining statements provide financial information
about activities for which the City acts solely as a trustee or agent for the benefit of those outside of the
government.
Reporting the City as a Whole
Our analysis of the City as a whole begins on page I5. One oY the most important questions asked about the
City's finances rs, "Is the City as a whole better off or worse off as a result of the year's activities?" The
Statement of Net Assets and the Statement of Activities report information about the City as a whole and about its
activities in a way that helps answer this question. These statements include all assets and liabilities using the
accrual basis of accounting, which is similar to the accounting used in most private-sector companies. All of the
current year's revenues and expenses are taken into account regardless of when cash is received or paid.
' These two statements report the City's net assets and changes in them. You can thick of the City's net assets -
the difference between assets and liabilities - as one way Co measure the City's financial health, or financial
position. Over time, increases or decreases in the City's net assets, is one indicator of whether its financial
' S
health is improving or deteriorating. You will need to consider other nonfinancial factors, however, such as
changes in the City's property tax base and [he condition of the City's roads, to assess [he overall health of the
city.
In the StatemenC of Net Assets and the Statement of Activities, we divide the City into two kinds of activities:
Governmental activities -Most of the City's basic services are reported here, including the police, public
works, parks and recreation, and general administration. Taxes, franchise fees, and state shared revenue
finance most of these activities.
Business-type activities -The City charges a fee to customers to help it cover all or most of the cost of
certain services it provides. The City's Golf Course, Aitport, and Building operations are reported here.
Fund Financial Statements
Our analysis of the City's major fiords begins on page 18. The fiord financial statements provide detailed
inforn~ation about the most significant funds -not the City as a whole. Some fiords are required to be established
by State law and by bond covenants. However, the City Council establishes many other funds to help it control
and manage money for particular purposes or to show that it is meeting legal responsibilities for using certain
[axes, grants, and other money (like the local option gas tax and infrastructure sales surtax (a.k.a. Discretionary
Sales Tax)).
Governmental Funds
Most of the City's basic services are reported in governmental fiords, which Focus on how money flows into and
out of those funds and the balances left at year-end that are available for spending. These funds are reported using
an accounting method called modified accrual accounting, which measures cash and all other financial assets that
can readily be converted to cash. The governmental fiord statements provide a detailed short-term view of the
City's general government operations and the basic services it provides. Governmental fund information helps
you determine whether there are more or fewer financial resources [hat can be spent in the near fithtre to finance
the City's programs. We describe the relationship (or differences) between governmental activities (reported in
the Statement of Net Assets and the Statement of Activities) and governmental fitnds in reconciliations at the
bottom of the fund financial statements.
The City maintains seventeen individual governmental funds. Information is presented separately in the
governmental fund balance sheet and in the governmental fiord statement of revenues, expenditures, and changes
in fund balances for the general fiord, discretionary sales tax special revenue fund, riverfront redevelopment
special revenue fund, and stormwater utility improvements capital project fund, all of which are considered to be
major funds. Data from the other thirteen governmental funds are combined into a single, aggregated presentation.
Individual fund data for each nonmajor governmental fund is provided in the form of combining statements
begins on page ».
Annual budgets are adopted for all governmental funds except the capital project funds, which are approved on a
`'life of the project basis", and the permanent fund, which is not budgeted. The budgetary comparison statements
have been provided for all governmental funds except capital project fiords to demonstrate compliance with the
budge[.
The basic governmental fund financial statements can be found on pages 18-22 of this report.
1
t
t
1
Proprietary Funds
When the City charges customers for the services it provides -whether to outside customers or to other units of
the City -these services are generally reported in proprietary funds. Proprietary funds are reported in the same
way that all activities are reported in the Statement of Net Assets and the Statement of Activities. In fact, the
City's enterprise funds (a component of proprietary funds) are the same as the business-type activities we report
in the govermuent-wide statements but provide more detail and additional information, suc(t as cash flows, for
proprietary fiords.
The basic proprietary fund financial statements can be found on page 23-26 of this report.
Fiduciary Funds
The City is the trustee, or fiduciary, for the Police Officers' Pension Plan. The City's fiduciary activities are
reported in separate Statements of Fiduciary Net Assets and Changes in Fiduciary Net Assets on page 27 and 28.
We exclude these activities from the City's other financial statemenU because the City cannot use these assets to
finance its operations. The City is responsible for ensuring that the assets reported in these fiords are used for
their intended purposes-
The City holds deposits for various individuals and businesses For contract perfomlance that are then rettu-ned
when the contract has been completed. These deposits are accounted for in an Agency fiord, where assets equal
liabilities.
Notes to the Financial Statements
The notes provide additional infornation that is essential to a full understanding of the data provided in the
government-wide and fund financial statements. The notes to the financial statements can be found on pages 29-
48 of this report.
Other Information
In addition to the basic financial statements and accompanying notes, this report also presents certain required
supplementary information concerning the City's major fiords budget and actual comparison and progress in
fimding its obligation to provide pension benefits to its employees. Required supplementary inforn~ation can be
found on pages 49-54 of this report.
Financial Analysis of the City as a Whole
THE CITY AS A WHOLE
The City's combined net assets increased $1.7 million from $45.2 million to $46.9 million or 4%. Looking at the
net assets and net revenues of the governmental and business-type activities, an increase in net assets of
governmental-type activities was offset by a decrease in net assets of the business-type activities. Our analysis
focuses on net assets (Table 1) and changes in net assets (Table 2) of the City's governmental and business-type
activities.
7
Statement of Net Assets
GOVERNMENT-WIDE STATEMENTS
The Following table reflects the condensed Statements of Net Assets:
Table 1
Statements of Net Assets
as of September 30, 2007 and 2006
(in thousands)
Governmental Activities Business-tvpe Activities Total Primary Government
2007 2006 2007 2006 2007 2006
Current and other assets $ 22,173 $ 23,313 $ 2,371 $ 2,867 $ 24,544 $ 26,180
Capital assets 32,942 29,644 IQ,013 9,909 42,955 39,553
Total assets $ 55,115 $ 52,957 $ ]2,384 $ 12,776 $ 67,499 $ 65,733
Noe-current liabilities
Other liabilities
Total liabilities
Net assets:
Invested in cap i[al assets,
net of related debt
2estricted
Unrestricted
Total net assets
$ 17,1 L0 $ 17,083 $ 1,323 $ 1,259 $ 18,433 $ 18,342
1,866 L,932 291 26] 2,157 2,193
$ 18,976 $ 19,015 $ 1,614 $ 1,520 $ 20,590 $ 20,535
$ 21,469 $ 17,580 $ 8,896 $ 8,799 $ 30,365 $ 26,379 '
9,420 5,068 570 560 9,990 5,628
5,250 11,294 1,304 1,897 6,554 13, L9t
S 36,139 $ 33,942 $ 10,770 $ 11,256 $ 46,909 $ 45,L98
For more detail information see the Statement of Net Assets on page l5.
Total net assets of the governmental activities increased from $33.942 million to $36.139 million. Total net assets
for business-type activities decreased from $11.256 million to $10.770 million.
The increase in governmental activities capital assets is due to projects that were completed during the period. The
increase iu governmental activities non-current liabilities is due to the recognition of the unfunded OPEB
obligation. The decrease in unrestricted net assets is mainly due to the corresponding increase itt restricted net
assets caused from investment in capital assets.
The overall decrease in net assets far business-type activities is due to the use of unrestricted assets during the
period. The increase in net assets -invested in capital assets of the City's business-type activities is primarily due
to the increase in capital assets fimded by the Federal Aviation Administration and the Florida Department of
Transportation for the City's municipal airport.
8
11
The following table shows the revenue and expenses of the total primary government.
Table 2
Changes in Net Assets
For the Fiscal Years Ended September 30, 2007 and 2006
(in thousands)
aevEnuEs
Program revenues:
Charges for services
Operating grants and contributions
Capital grants and conh~ibutions
General revenues:
Property taxes
Other taxes
Intergovernmental
Other
Total revenues
Governmental Business-type Total Primary
Activities Activities Government
2007 2006 2007 2006 2007 2006
$ 1,493 $ 1,634 $ 2,406 S 3,177 $
193 408 - 7
1,014 1,301 500 1,057
5,090 4,645 - - 1,090 4,645
4,777 4,908 - - 4,777 4,908
2,084 2,242 - - 2,084 2,242
2,446 2,338 L37 125 2,583 2,463
17,097 17,476 3,043 4,366 20,140 21,842
EXPENSES
I General government
Public safety
Physical environment
Transportation
' Economic environment
Culntre and recreation
Golf Course
' Airport
Building
Interest and fiscal charges
Total expenses
' Change m net assets before transfers
Transfers
' Increase in nei assets
Net assets -October 1, 2006
Net assets -September 3Q, 2007
1
3,084 3,130 - - 3,084 3,130
5,377 4,791 - - 5,377 4,191
L,695 2,194 - - 1,695 2,194
2,276 2,173 - - 2,276 2,173
606 99 - - 606 99
1,237 1,208 - - 1,237 1,208
- - 1,534 1,553 1,534 1,558
- - 1,047 802 1,047 802
- - 905 937 905 937
668 706 - - 668 706
14,943 13,701 3,486 3,297 18,429 16,998
2,154 3,775 (443) 1,069 1,71] 4,844
43 (1,414) (43) 1,414 - -
2,197 2,361 (486) 2,483 1,711 4,844
33,942 31,58E L1,256 8,773 45,198 40,354
S 36,139 $ 33,942 $ 1Q770 $ L1,256 $ 46,909 $ 45,198
3,899 $ 4,811
193 415
1,514 2,358
Overall the total revenues decreased $1.702 million from the previous year. The total cost of all programs
increased by 8.4% ($1.431 million). Our analysis below separately considers the operations of governmental and
business-type activities.
Governmental Activities
Governmental activities revenues exceed expenses by $2.154 million. Total revenues decreased approximately
S0.379 million from the previous year. The decline was primarily in categories affected by tfre slowdown in
economic activity. Less was received in Recreation Impact fees and a downturn was noted iu sales taxes and state
shared revenues. Total expenses increased $1,242 million from the previous year. The largest increase in
spending was in the category of public safety.
t 9
The following is a graphic illustration of the comparison for governmental activities revenue and expenses.
Governmental Activities Comparison
for Fiscal Year 2007 and Fiscal Year 2006
G,000
5,000
a,ooo ~ -
a,ooo ~
Q ~ z,ooo rn ,
:J ~,ooo LLJ , m , ~. ~T T~ ~T ~T~-~-~TmTm-,
Se<~~GCS 4~`~~`vC,~~cc`y ,a~,o ,v~b°c°vave e°~~°meos'LS,v~evcm°°c°``°a°~m~°s¢a,,U° debt
y\°~ etv"c&,vQt'va :°Qe~ ~~t` °`e<~ ~°t ~ °~eC °V" ~~si° ,acsQ °wi° iec< ve<:°
Gba`pz OP G 4 ~we:6 ~u eaA6 b`1' av° °~°~~ <°an ~o~O~C;
C Fp o G° ~ ekes
`~c
RevenuelEspe nse types
^zo0~ ^zaov
Business-type Activities
Revenues of the City's business-type activities (see Table 2) decreased $1323 million primarily because of the
reduction in building permit fees as a result of the slowdown in activity. Expenses rose SJ% for all the City's
business-Cype activities, while expenses for the Building Enterprise fund were held to a 33% increase. A
substatntial payment to settle a legal dispute for the Airport and a~~ increase in depreciation expense caused a
significant increase to Airport expense as compared to fiscal year 2006. The City's Municipal Airport enjoys a
continued interest by the Florida Department of Transportation-Aviation Section and Federal Aviation
Administration to upgrade the airport facilities as evidenced by repeated support via grant finding.
Following is a graphic comparison of the City's business-type activities.
Business-Type Activities Comparison
for Fiscal Year 2007 and Fiscal Ye al 2006
3,500
3,000
.. ~ 2,500
- ~ 2,000
;~ LR 1,500
C
., ~,nao
500
~~es ~~ts its yore uos..s osd pi's
set ~6 ,a~6 Oe~ etP ey.Pe a~~
G~aNes~°< oPeNvn GaP~v OJve~ °`t C°~~~ a~:Qn`t 6"s`J`~~e
G
lie ven ue/Gx pense lypes
L0200> ^200G
l~
1
1
f J
i
L~
1
l 1
' FINANCIAL ANALYSIS OF THE CITY'S FUNDS
As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance-related legal
' requirements.
Governmental Funds
' The focus of the City's governmental funds is to provide information on near-terns inflows, outflows, and
balances of spendable resources. Such information is useful in assessing the City's financing requirements. [n
' particular, unreserved fund balance may serve as a useful measure of a government's net resources available for
spending at the end of the fiscal year.
' As the City completed the fiscal year, its governmental funds (as presented in the balance sheet on pages 18-19)
reported a combined fiord balance of $20.0 million, which is a decrease of $1.9 million over the prior year of
$21.9 million. Approximately 53.7% of this total amount ($10.7 million) constitutes unreserved, undesignated
' fund balance, which is available far spending at the City's discretion. The remainder of fund balance is reserved
or designated to indicate that it is not available for new spending because i[ has already been commuted 1) to pay
debt service ($231,894), 2) to fund capital projects ($6,665,211), 3) to generate income to pay for the perpehial
care of [he municipal cemetery ($694,506), or 4) for a variety of other restricted or designated purposes
($1,674,880).
The general fund is the chief operating fund of the City. At the end of the fiscal year, unreserved, undesignated
fund balance of the general fund was $5,424,199, while total fund balance was $6,390,787. As a measure of the
general fund's liquidity, it may be useful to compare both unreserved fund balance and total fiord balance to total
fund expenditures. Unreserved, undesignated fiord balance represents 45 percent of total genera] fiord
' expenditures, while total fund balance represents 53 percent of that same amount.
The fund balance of the City's general fund decreased by $88,285 during the current fiscal year. Key factors in
' this reduction are as follows:
• Intergovernmental revenues decreased by $396,559, as a result of a slowdown in safes activity.
' • Public safety expenditures increased by $867,184, as a result of additional payroll costs.
The discretionary sales tax revenue special revenue fund has a total fund balance of 52,411,939, all of which is
' unreserved and undesignated. The increase of the total fund balance from prior year ($607,607) is mainly due to
an increase in funds being accumulated for use toward projects scheduled in future years.
The riverfront redevelopment special revenue fund has an um'eserved and undesignated fund balance of
' $249,716, while total fund balance was $355,965. The decrease of the total fund balance from prior year
($314,452) is mainly due to capital outlays made during the year.
The transportation improvements capital project fund has a total fund balance of $1,940,466, all of which is
encumbered or reserved for transportation related construction such as roads, intersections and sidewalks.
The stormwater utility improvements capital project fund has a total fiord balance of 54,619,885, all of which
is reserved for stormwater capital projects. The decrease of the Coral fiord balance from the prior year ($418,629)
is due to capital outlays made during the year.
1
' 11
Proprietary Funds
The City's proprietary funds provide the saute type of information found in the government-wide financial
statements, but in more detail.
The total net assets of the golf course fund at the end of the fiscal year amounted to S479,090, while the
tnrestricted net assets amounted to .$237,844. Compared to the prior year iu the same category, the net assets has
an increase of $167,271 from the prior year while the unrestricted net assets has an increase of $231,983 from [he
prior year. This is mainly due to the improvement in operating income compared to the prior year. Detailed golf
coarse net assets information is presented on page 23.
The total net assets of the airport fund at the eud of the ftscal year amounted to $9,239,371, while the
unrestricted net assets amowtted to $57,953. Canpared to the prior year in the same category, net assets have
decreased by $226,397 while the unrestricted net assets have decreased $397,361. The decrease in unrestricted net
assets is mainly due to the construction of airport capital projects and a substantial payment made in settlement of
a legal dispute.
The total net assets of the building fund aC the end of the ftscal year amounted to $1,051,816, while Che
unrestricted net assets amounted to $1,008,089. The building fund experienced a large operating loss, as a result
of the slowdown in activity and drop in building permit fees.
Other factor concerning the finances of these three funds have already been addressed in the discussion of the
City's business-type activities.
General Fund Budgetary Highlights
Over the course of the fiscal year, the City Council revised the City budget four times. These budget amendments
fall into four categories. The first category includes amendments and supplemental appropriations that were
approved shortly after the beginning of the year and reflect fund balances carried over from the prior fiscal year to
fiord outstanding encumbrances. The second category includes adjustments for unanticipated revenues. The third
category includes the changes that the Council made during the year to take into account the City's offering of an
employee early retirement program and to cover additional costs for ditch and Swale mowing. The fourth
category includes supplemental appropriations for required police pension contributions. During the fiscal year,
the City amended the general fund budget in the amount of $606,758 for all these items. The main components of
the increase are as follows:
• $58,020 supplemental appropriation to general fund departments for encumbered amounts carried forward
from the prior fiscal year.
• $31,813 supplemental appropriation for FEMA reimbursement for hurricane damage.
• $26,770 supplemental appropriation for proceeds generated from surplus equipment sales.
• $211,707 supplemental appropriation for the costs associated witlt offering an early retirement program.
• $206,226 supplemental appropriations to the police department for the required pension contribution.
• $72,222 supplemental appropriations for unanticipated administrative fee revenues, private contributions
and additional cost associated with the ditch and Swale mowing contract.
During the fiscal year, total general fund actual revenues were less than final amended budgetary estimates and
total general fiord achial expenditures were less than the final amended budgetary estimates. The shortfall iu
anticipated revenues was mainly due [o a decline in intergovernmental revenues, specifically the City's share of
sales tax proceeds. Positive variances on expendittres resulted in a much lower draw on existing fund balances
than had been anticipated.
12
1
1
t
1
' CAPITAL ASSET AND DEBT ADMINISTRATION
Capital Assets
' At the end of fiscal year 2007 the City had $62,233,905 invested in a broad range of capital assets, including land,
police and public works equipment, buildings, park facilities, roads, bridges, and stormwater drainage structures.
This amount represents a neC increase (including additions and deductions) of $4,93,713, or 8.6%, over last year.
The following table illustrates the changes in capita] assets. See page 38 and page 39 in the notes to the financial
statements for detailed changes in capital assets.
1
1
Governmental
Activities
Land
Buildings
Improvements
Equipment
Infrastructure
Construction-in
Progress
Totals
2007 2006
$ 5,696,946 $ 5,3D1,947
10,996,497 9,958,190
4,970,638 4,614,326
fi,82Q,O51 6,436,238
18,677,191 17,375,199
Table 3
Business-type
Activities To[aIs
2007 2006 2007 2006
$ 9,060 $ 9,060 $ 5,706,OD6 $ 5,311,007
3,232,472 1,832,148 14,228,969 1 1,790,338
7,216,078 L,18I,052 6,L86,716 5,795,378
804,465 638,926 7,624,516 7,075,164
5,817,369 6,012,963 24,494,560 23,388,162
2,692,704 1,167,207 1,300,434 2,770,936 3,993,138 3,938,143
$ 49,854,027 $ 44,853,107 $ 12,379,878 $ 12,445,085 $ 62,233,905 $ 57,298,192
Governmental activities had the following major increases during the fiscal year:
• An increase in land due to the acquisition of property.
• An increase in buildings mainly due to renovation of the historic elementary school building (formerly
used as the City Hall).
• An increase in improvements mainly due to the capitalization of work completed at the City's parks and
playgrounds.
• An increase in equipment mainly due to capitalization of new police vehicles.
• An increase in infrastruchue mainly due to the work on roadways and stomlwater drainage system.
• An increase in construction in progress due to the capitalization of the Main Sheet Twin Ditches project.
Business-type activities had the following major increases during the fiscal year:
• An increase in buildings mainly due to the completion of the municipal airport administration building.
• A decrease in infrastructttre mainly due to adjustments required to the carrying value of the greens at the
Golf Course.
• A decrease in construction in progress primarily due to the canpletion of airport mmvay and taxiway
improvements.
Debt
On September 30, 2007, the City had $16,791,805 in bonds, notes and capital leases outstanding versus
$ l 8,068,698 on September 30, 2006 - a decrease of 7.1 % - as shown in the table on the following page:
The decrease in debt is solely attributable to the retirement of debts. The Infrastructure Sales Surtax Revenue
Bonds, Series 2003 and Series 2003A and the Stormwater Utility Revenue Bonds, Series 2003 are insured by
AAA rated insurance agencies, the bonds are all rated AAA, which is the highest rating given by rating agencies.
The City's Recreational Facilities Improvement and Refunding Revenue Bonds, Series 2001 canies an AAA
rating from Standard & Poor's, a rating it has held since 1992. All of the City's other debt, primarily notes and a
capital lease, are not rated. Other obligations of the City include accrued vacation pay and sick leave.
Additional information on the City's long-tens deb[ can be found on pages 42 through 44 in the notes to the
financial statements.
13
1
Governmental
Activities
In CrastrucLLire sales surtax revenue
bonds, Series 2003
Infras[ruchire sales surtax revenue
bonds, Series 2003.4
Stonnwater utility revenue bonds,
Series 2003
Notes payable (backed by local
option gas tax)
Capital lease obligation (backed
by Ci[y)
Recreational facilities
improvements and reftmding
revenue bonds, series 2007
Totals
2007 2006
$ 7,405,000 $ 7,955,000
1,740,000 1,870,000
4,815,000 5,055,000
1,566,840 1,790,544
147,539 288,252
Table 4
Business-type
Activities
2007 2006
$ - $
Totals
2007 2006
$ 7,405,000 $ 7,955,000
1,740,000 1,870,00D
4,81S,00D S,OS5,000
1,566,840 1,790,544
147,539 288,252
- - 1,117,426 1,109,902 ],117,426 1,109,902
$ 15,674,379 $ 16,958,796 5 1,117,426 S 1,109,902 $ 16,791,805 $ 18,068,698
ECON0IVIIC FACTORS AND NEXT YEAR'S BUDGETS AND RATES
The City's elected and appointed officials considered many factors when setting the fiscal year 2008 budget, tax
ratcs, and fees that will be charged for the business-type activities. One of those factors is the economy.
Sebastian's local economy consists largely of retail and service industries. Less than one percent is devoted to
industrial activities. Construction of new homes is the largest single business in the area. Some of the largest
retail stores include Publix Supetmarket and Wal-Mart Stores, Inc.° The Indian River County unemployment rate
in 2007 was 6.0% up from 4.1% in the previous year and down from a high of 8.1% in 1997. This indicates that
business growth in the area remains strong. Still, employment in the county fluctuates seasonally due to farm
workers. In ftscal year 2007, the city experienced a reduction in property value (2.8% decrease) and a large
decrease in construction permits (from 506 to 116). The decrease in construction pelmits reflects the national
trend and is consistent with [he national housing market.
These indicators were taken into account when adopting the General Fund budget for fiscal year 2008. Amounts
available for appropriation in the General Fund budget are $11,980,334, a decrease of 2.8% from the original
fiscal year 2007 budget of $12,322,178 and a decrease of 7.3% from the final Fiscal year 2007 budget. The 2.8%
increase is mainly due to uncertainty about the slowdown of building activity and concerns about measures that
may be enacted by the State to limit revenues and spending by local govenmients. The City has determined that it
should proceed cautiously and be in a better position to address those mandates.
The Golf Course has experienced an increase in golf revenues in fiscal year 2007 mainly due to a full recovery
from the hurricanes that impacted the City in fiscal year 2005. The increase of revenues has help the City to meet
the Recreational Facilities Improvement and Refunding Revemte Bonds, Series 2001 bond coverage requirement,
which is the net revenues equal to at least 125% of the annual debt service payment. City staff continues to
monitor [lie revenue stream and intends to adjust rates whenever necessary to meet the bond coverage
requirement.
REQUEST FOR INFORMATION
This financial report is designed to provide our citizens, taxpayers, customers, investors and creditors with a
general overview of the City's finances and to show the City's accountability for the money it receives. If you
have questions about this report or need additional information, contact the Finance Department at City of
Sebastian, 1225 Main Street, Sebastian, Florida 32958.
14
1
1
1
1
i
1
i
City of Sebastian, Florida
Statement of Net Assets
September 30, 2007
ASSETS
Cash and cash equivalents
Investments
Receivables
Special assessment receivable
Internal balances
Prepaid items
Inventory
Restricted assets:
Temporarily restricted:
Cash and cash equivalents
Investments
Permanently restricted:
Investments
Overfunded pension costs
Deferred charges
Capital assets not being depreciated:
Land
Construction in progress
Capital assets (net of accumulated depreciation):
Buildings
Improvements other than buildings
Machinery and equipment
Infrastructure
Total assets
LIABILITIES
Accounts payable and other current
liabilities
Accrued interest payable
Deferred revenues
Unearned revenues
Rent concession liability
Non-current liabilities:
Due within one year
Due in more than one year
Total liabilities
NET ASSETS
Invested in capital assets, net of related debt
Restricted for:
Capital projects
Debt service
Road projects
Community redevelopment
Perpetual care:
Expendable
Nonexpendable
Other purposes
Unrestricted
Total net assets
Governmental Business-type
Activities Activities Total
$ 192,033 $ 75,032 $ 267,065
11,204,105 1,592,858 12,796,963
938,834 233,733 1,172,167
3,849 - 3,849
200,000 (200,000) -
116,974 19,771 136,745
51,635 37;278 88,913
202,822 - 202,822
8,086,667 570,890 8,657,557
603,242 - 603,242
121,912 - 12L,912
450,841 41,691 492,532
5,696,946 9,060 5,706,006
2,692,704 1,300,434 3,993,138
9,084,860 2,833,569 11,918,429
3,569,938 948,37] 4,518,309
1,787,622 296,453 2,084,075
10,109,843 4,625,040 14,734,883
55,114,827 12,384,!80 67,499,007
1,522,532 185,424 1,707,956
257,080 - 257,080
67,254 79,581 146,835
- 13,000 13,000
1,437,238 293,060 1,730,298
L5,692,140 1,042,83 8 16,734,978
18,976,244 1,613,903 20,590,147
21,469,456 8,895,501 30,364,957
5,998,366 - 5,998,366
231,894 314,490 546,384
2,113,300 - 2,113,300
355,965 - 355,965
91,264 - 91,264
603,242 - 603,242
25,098 256,400 281,498
5,249,998 1,303,886 6,553,884
$ 36,138,583 $ 10,770,277 $ 46,908,860
The accompanying notes to financial statements are an integral part of this financial statement.
15
FunctionlProeram
Governmental activities:
General government
Public safety
Physical environment
Transportation
Economic environment
Cultural/recreation
Interest and fiscal charges
Total governmental activities
Business-type activities:
Golf Course
Airport
Building
Total business-type activities
Total govemment
City of Sebastian, Florida
Statement of Activities
For the year ended September 30, 2007
Charges Tor
Expenses Services
Program Rerennes
Operating Capital
Grants and Grants and
Coutributions Contributions
$ 3,083,609 $ 422,897 $ 27,370 $ -
. 1,377,107 92,853 !47,288 9,615
1,695,066 691,021 - -
2,276,497 - !8,018 703,085
605,510 - - -
1,237,398 85,945 - 30 L,781
667,950 - - -
14,943,137 1,492,716 192,676 1,014,481
1,533,900 1,652,288 - -
1,046,994 344,813 - 500,428
905,452 408,875 - -
3,486,346 2,405,976 - 500,428
$ 18,429,483 $ 3,898,692 S 192,676 $ 1,514,909
General Revenues:
Property taxes, levied for general purposes
Sales and use taxes
Franchise fees
Stale shared revenues not restricted to specific programs
[merest earnings
Miscellaneous
Tota] general revenues
Transfers
Total general revenues and transfers
Change in net assets
Net assets -beginning
Net assets -ending
1
The accompanying notes to financial statements aze an integral part of this financial statement.
16 !
' Net (Expense) Revenue and
Changes in Net Assets
' Governmental Business-type
Activities Activities Total
$ (2,633,342) $
(5,127,35 ( )
(804,045)
(1,555,394)
(605,510)
(849,672)
(667,950)
' (12,243,264)
$ (2,633,342)
(5,127,35 L)
(804,045)
(1,555,394)
(605,510)
(849,672)
(667,950)
(12,243,264)
' = 118,388 118,388
(zo1,753) (zo1,753)
- (496,577) (496,577)
(s79,942> (s79,942)
(12,243,264) (579,942) (12,823,206)
5,089,841
' 4,776,691
1,106,698
2,083,523
1,147,931
192,300
14,396,984
- 5,089,84]
- 4,776,691
- 1,106,698
- 2,083,523
137,207 1,285,138
- 192,300
137,207 14,534,191
42,720 (42,720)
14,439,704 94,487 14,534,191
2,196,440 (485,455) 1,710,985
5 33,942,143
36,138,583 $ 11,255,732
10,77Q,277 $ 45,197,875
46,908,860
17
City of Sebastian, Florida
Balance Sheet
Governmental Inds ,
September 30, 2007
Stormwater
Discretionary Riverfront
Transportation
Utility '
General Sales Tas Redevelopment Improvements Improvements
ASSETS
Cash nerd cash equivalents
$
81,215
$ 50,774 $ 20,009
S
35,770
$ 55,589
Investments 6,164,337 2,142,745 336,726 2,326,336 4,768,989
Accounts receivables 227,950 - - - -
Special assessments receivable 3,849 - - - - '
Due from other govennnents 270,501 211,167 - - 2,79'1
Interest receivable 31,212 7,293 2,331 5,514 277
Inventory 51,635 - - - -
Prepaid items 116,974 - - - -
Advance to other funds 200,000 - - - -
Totalassets $ 7,147,673 $ 2,411,984 $ 359,066 $ 2,367,620 $ 4,827,652
LIABILITIES AND FUND BALANC ES
Liabili[ies~.
Accounts payable $ 601,223 S 45 ~ 3,101 $ 427,154 $ 113,803
Retahtage payable - - - - 88,965
Due to other governments 84,560 - - - -
Deferred revenues
Unearned revenues 3,849
65,054 - -
- - -
- -
-
Other deposits held in escrow 2,200 - - - -
Tutalliabilities 756,886 45 3,101 427,154 207,767
Fund balances. '
Reserved for:
Encumbrance 62,445 - 106,249 2ll,131 316,705
Advance to other t-unds 200,000 - - - -
Deb[ service
-
- -
-
- '
Capital projects - - - 1,729,335 4,303,180
PropeRy and casualty 100,000 - - - -
Centetery caz~e - - - - -
Law enforcemeut - - - - -
Entergency services 350,000 - - - -
Equipment replacement 235,088 - - - - '
Um~eserved:
Designated for employee events 6,251 - - - -
Designated for law enforcement 12,804 - - - -
Undesignated, repotted in'. '
General fiord 5,424,199 - - - -
Special revenue fiords - 2,411,939 249,716 - -
Totalfund balances 6,390,787 2,411,939 355,965 1,940,966 4,619,885
Total liabilities and hind balances $ 7,147,673 $ 2,411,984 $ 359,066 $ 2,367,630 5 4,827,652
Atnouuts reported for govemrnenta] activities in the statement of net assets are different because: ,
Capital assets rued in govemtnental activities are not financial resources, therefore, are not reported in the fiords.
Negative net pension obligation resulting from overfunding of the police officers' pension plan.
Accrued other post employment and termination benefits az~e not futauciai uses, therefore, are not reported in the fiords.
Long-term liabilities are not due and payable in the current period and, therefore, are not reported in the funds.
Accmed long term debt interest expenses are not financial uses, therefore, are not reported in the funds.
Same interest receivables are not fmancial resources in the cunent period aztd, therefore, are not reported in [he foods.
Special assessment receivables are not fmancial resources in the current period, therefore, are reported as deferred revenues.
Net assets of govermnental activities
The accompanying uotes to fmancial statements are an integral part of this financial statement '
18
i
i
Oilier Total
Governmental Governmental
Funds Funds
$ 151,493 $ 394,355
4,154,881 19,894,014
- 227,950
- 3,349
73,229 557,694
20,670 67,303
- 51,635
- 116,974
- 300,000
$ 4,400,278 $ 21,514,273
$ 68,790 $ 1,219,115
38,692 127,657
- 84,560
- 3,349
- 65,D54
- 2,200
107,482 1,502,435
49,109 745,639
- 300,000
231,394 23 L,394
632,696 6,665,211
- 100,000
694,506 694,506
25,093 25,098
- 350,000
- 235,088
- 6,251
- 12,804
- 5,424,199
2,659,493 5,321,148
4,292,796 30,011,838
$ 4,400,278
32,941,913
121,913
(288,856)
(16,430,881)
(257,080)
85,888
3,849
$ 36,138,583
19
City of Sebastian, Florida
Statelnent of Revenues, Expenditures, and Changes in Fund Balances
Governmental Funds
For the Year Ended September 30, 2007
Stormwater
Discrefionary Riverfront Transportation Utility
General Sules Tax Redevelopment Improvements Improvements
REVENUES:
faxes:
Property 5 4,537,100 $ - $ 552,741 ,$ - $ -
Public utility 2,216,381 - - - -
Sales - 2,560,310 - - -
~lotorfuel - - - - -
Franchise fees 1,106,698 - - - -
Licenses and permits 186,875 - - - -
Inte~govenumental 2,221,215 - - - -
impact fees - - - - -
Charges for serviced 387,058 - - - -
Fines 64,464 - - - -
Investmenteantings 340,759 120,198 33,209 25,484 196,923
Conhibutious and donations 32,876 - - 15,000 -
Otlterrevenue 170,174 - 100 - -
Total revennas 11,263,600 3,680,508 536,OS0 40,484 196,923
EXPENDITURES
t.'11rTentl
General govenunent 2,999,652 - - - -
Public saferd 4,677,832 - - - -
Physical enviromnen[ 1,301,640 - - - -
Transpottation 1,538,322 - - - -
Econaenic enviramnen[ - - 80,279 - -
Culhne uid recreation 975,087 - - - -
Debt Service:
Principal - - - - -
[nterest and fiscal charges - - - - -
Capital outlay 587,264 - 609,822 1,056,893 1,722,711
Total expendihn'es 12,079,797 - 690,101 1,056,393 1,722,711
Excess (dolieiency) of revenues
over (under) expendihves (816,197) 2,680,508 Q04,OS 1) (1,016,409) (1,5?5,788)
OTHER FIN9NCING
SOURCES (USES)
Transfers in 727,860 517,314 - 1,024,849 1,107,159
Transfms ouC - (2,590,215) (215,401) - -
Total other financing sources (uses) 727,860 (2,072,901) (215,401) 1,024,849 1,107,159
Net changes ui fund balances (88,337) 607,607 (319,452) 8,440 (418,629)
Fund balances-beginning 6,479,072 1,804,332 675,417 1,932,026 5,038,514
Residue] fiwd equity transfer 52 - - - -
Pund halancea -ending $ 6,390,787 $ 2,411,939 $ 355,965 $ 1,940,466 5 4,619,885
The accompanying notes to financial statements are an integral part of this finaztcial statement.
20
1
i
i
L
i
t
Other Total
Governmental Governmental
Funds Funds
$ - $ 5,089,841
- 2,216,381
2,560,310
688,085 688,085
= 1,106,693
186,375
242,413 2,463,628
56,875 56,875
884,044 1,271,102
6,350 71,314
345,470 1,062,043
26,253 74,129
226 170,500
2,250,216 17,017,781
1
- 2,999,652
22,615 4,700,447
79 1,301,719
195,375 1,733,697
80,279
' = 975,087
1,284,418 1,284,418
643,305 643,305
1,271,900 5,248,590
3,417,692 18,967,194
1
(1,167,476) (1,949,413)
1,823,834
(2,352,680) 5,201,016
(5,158,296)
(528,846) 43,720
(1,696,327_) (1,90 fi,693)
5,989,170 21,918,531
(52)
$ 4,292,796 $ 20,011,838
21
City of Sebastian, Florida
Reconciliation of the Statement of Revenues, Expenditures,
and Changes in Fund Balances of Governmental Funds
To the Statement ot• Activities
For the Year Ended September 30, 2007
Net change in fund balances - mtal govermnental funds $ (1,906,693)
Amount reported for govemmental activities in the statement of activities are
different because:
Some interest revenues reported nt the statement of activities do not constitute
curzent financial resources, therefore, are not reported as revenues in governmental
funds. 85,388
Govemmental funds report capital outlay as expenditures. However, in the
statement of activities, the cost of those assets is allocated over their esthnated
useful lives as depreciation expense. 3,303,886
Govemmental funds only report the disposal of assets to the extent proceeds are
received from the sale. In the statement of activities, a gain ox loss is reported for
each disposal. (6,108)
Overfrmded pension contributions are reported as expenditures in the fund financial
statements and recorded as a net pension asset on the statement of net assets. (26,695)
Repayment of bond principal, note principal, and capital lease principal are
expenditures in the governmental funds, but the payment reduces long-term
liabilities in the statement ofnet assets. 1,384,417
Some expenses reported in the statement of activities do not require the use of
curzent financial resources, therefore, are not reported as expenditures in the
governmental funds. (538,255)
Change in net assets of govenunen[al activities $ 2,196,440
The accompanying notes to financial statements are an integral part of this financial statement.
22
1
1
J
LJ
1
1
1
t
1
L1
1
City of Sebastian, Florida
Statement of Net Assets
Proprietary Funds
September 30, 2007
Funds
Golf Course Airport Building Totals
ASSETS
Curren[assefs:
Cash and cash equivalents $ 2!,861 $ 4L,526 $ 11,645 $ 71,032
Investments 342,190 128,296 1,L22,372 L,592,558
Restricted cash, cash equivalents and
inveshnents:
Revenue bond covenant accowats 570,890 - - 570,890
Accounts receivable - 15,896 - 15,896
Due from other governmeuts - 210,334 - 210,334
Interest receivable 63 127 7,3 L3 7,503
Inventory 10,174 27,104 - 37,278
Prepaid items 6,808 7,911 5,052 ]9,771
Total current assets 951,986 431,194 1,146,382 2,529,562
Noncurzent assets:
Deferred charges 41,691 - - 41,691
Capital assets:
Land - 9,060 - 9,060
Buildings 331,228 2,901,244 - 3,232,472
Improvements other than buildings 206,265 1,009,8]3 - 1,216,078
Machinery and equipment 338,137 405,802 60,526 804,465
Infrastmcture 1,L00,951 4,716,418 - 5,817,369
Construction in process - 1,300,434 - 1,300,434
Less accumulated depreciation (1,188,799) (L,L61,353) (16,799) (2,366,951)
Total noncurrent assets 829,473 9,181,418 43,727 IQ,054,6I8
Total assets 1,781,459 9,6 L2,612 1,190,109 12,584,180
LIABILITIES
Current liabilities
9cwunts payable 45,705 116,151 29,128 190,984
Advance from other hind - 200,000 - 200,000 .
Due to other governments 7,279 321 - 7,600
Unearned revenues 56,140 10,563 12,d78 79,581
Compensated absences 1,695 1,801 6,404 9,900
Matured bands payable 270,000 - 270,000
Total curzent liabilities 380,819 328,836 43,410 758,065
Nan-cunen[ liabilities:
Accmed termination benefits - - 24,503 24,503
Compensated absences 55,035 28,352 54,157 137,544
Unfunded OPEB obligation 6,089 16,053 11,223 33,365
Rent concession liability 13,000 - - 13,000
Bonds payable (net of unamortized premium
and deferred amount on refunding) 847,426 - - 847,426
Total non-current liabilities 921,550 44,405 89,883 1,055,838
Total liabilities 1,302,369 373,241 138,293 1,813,903
NET ASSETS
[uvested in capital ass ets, net of related deb[ (329,644) 9,181,418 43,727 8,895,501
' Restricted for:
Debt service 314,490 314,490
Other purposes 256,400 - - 256,400
Unrestricted 237,844 57,953 1,008,089 1,303,886
' Total net assets $ 479,090 $ 9,239,371 $ 1,051,816 $ 10,770,277
The accompanying notes to financial statements are an integral part of this financial statement.
23
City of Sebastian, Florida
Statement of Revenues, Expenses and Changes in Fund Net Assets
Proprietary Funds
For the Year Ended September 30, 2007
Operating revenues:
Charges for fees and rents:
Building permit Fees
Goff course fees pledged as
security for revenue bonds
Rents
Other revenue
Total operating revenues
Operating expenses:
Salaries, wages and employee benefits
Contractual services, materials and supplies
Depreciation
Total operating expenses
Operating income (loss)
Nonoperating revenues (expenses):
Interest income
Interest income pledged as security
for revenue bonds
Interest expense
Band amortization expense
Total nonoperating revenues (expenses)
Income/(loss) before capital contributions
and transfers
Transfer out
Capital contributions
Change in net assets
Total net assets -beginning
Total net assets -ending
The accompanying notes to financial statements are an integral part of this financial statement.
Enterprise Funds
Golf Course Airport Building Totals
$ - $ - $ 408,875 $ 408,875
1,610,017 - - 1,610,017
30,382 271,894 - 302,276
11,889 72,919 - 84,808
1,652,288 344,8 L3 408,875 2,405,976
344,007 233,117 65b,463 1,233,587
1,036,375 453,757 237,461 1,727,593
85,607 360,120 II,528 457,255
1,465,989 1,046,994 905,452 3,418,435
186,299 (702,181) (496,577) (1,012,459)
- 18,076 7Q,248 88,324
48,883 - - 48,883
(54,014) - - (54,014)
(13,897) - - (13,897)
(19,028) 18,076 70,248 69,296
167,271 (684,105) (426,329) (943,163)
- (42,720) - (42,720)
- 500,428 - 500,428
167,271 (226,397) (426,329) (485,455)
t
311,819 9,465,768 1,478,145 11,255,732
$ 479,090 $ 9,239,371 $ 1,051,816 $ IQ,770,277 '
24 ,
1
1
City of Sebastian, Florida
Statement of Cash Flows
Proprietary Funds
For the Year Ended September 30, 2007
CASH FLOWS FRDM OPERATING
ACTNITIES:
Cash received from customers and users
Cash payments to suppliers
Cash payments for employee services
Net cash provided (used) by operating
activities
CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES:
Transfer to other fund
Net cash provided (used) by noncapital
financing activities
CASH FLOWS FROM CAPITAL AND
' RELATED FINANCING ACTNITIES:
Acquisition and construction of capital assets
Receipt fi'om capital grants
Receipt from advance from other fund
' Bond issuance casts
Interest paid on revenue bonds
Capital contributed to other
' Ne[ cash provided (used) by capital and
related financing activities
t
CASH FLOWS FROM INVESTING
ACTNITIES:
Interest on investments
Net cash provided by investing activities
Ne[ decrease in cash and cash equivalents
Cash and cash equivalents, October 1
Cash and cash equivalents, September 30
Enterprise Funds
Golf Course Airport Building Totals
$ 1,654,551 S 374,877 S 407,738 $ 2,437,166
(I,06Q,030) (424,]41) (246,511) (1,73Q682)
(332,792) (215,461) (615,708) (1,163,961)
z61,729 (z6a,7zs) (a~a,a8q (as7,a77)
(42,720)
- (42 720)
(!8,110) (513,798)
- 331,831
- 200,000
7,524
(30,769)
(70,884)
(42,720)
(42 720)
(12,474) (544,382)
- 331,831
- 200,000
- 7,524
- (30,769)
- (70,884)
(41,355) (52,851) (12,474) (106,680)
52,073 18,046 71,855 141,974
52,073 18,046 71,855 141,974
272,447 (342,250) (395,100) (464,903)
662,494 512,072 1,529,117 2,703,683
$ 934,941 $ 169,822 $ 1,134,017 $ 2,238,780
The accompanying notes to financial statements are an integral part of this financial statement.
25
City of SebastiaB, Florida
Statement of Cash Flows
Proprietary Funds
For the Year Ended September 30, 2007
(Continued)
Reconciliation of operating income (loss) to
net cash provided (used) by operating activities:
Operating income (loss)
Adjustments to reconcile operating income to net
cash provided (used) by operating activities:
Depreciation expense
(Increase) Decrease in assets:
AccounCS receivable
Prepaid expenses
Inventories
Increase (Decrease) in liabilities:
Accounts payable
-ue to other governments
Rent concession liability
Accrued termination benefits
Accrued compensated absences
Accrued OPEB liability
Unearned revenues
Total adjustments
Net cash provided (used) by operating activities
Cash and cash equivalents reconciliation:
Current assets:
Cash and cash equivalents
Investments
Restricted asset:
Investments
Cash and cash equivalents at September 30
Enterprise Funds
Golf Course Airport Building Totals
$ 186,299 $ (631,297) $ (496,577) $ (941,575)
85,607 360,120 11,528 457,255
- 23,276 - 23,276
(s,z33) (7,911) (S,os2) pa,196)
3,5]a (27,10a) - (z3,59o>
(8,132) (6,322) (3,998) (18,412).
(804) 69 - (731)
(13,000) - - (13,000)
- - 37,663 37,663
5,126 1,603 (8,131) (1,402)
6,089 16,053 11,223 33,365
2,263 6,788 (1,137) 7,914
75,430 366,572 42,096 484,098
$ 261,729 $ (264,725) $ (454,481) $ (457,477)
$ 21,861 $ 4L,S26 $ 11,645 $ 75,032
342,190 128,296 1,122,372 1,592,858
570,890 - - 570,890
$ 934,941 $ 169,822 $ 1,134,017 $ 2,238,780
The accompanying notes to financial statements are an integral part of this financial statement.
26
i
1
lJ
1
1
1
1
1
1
ASSETS
Cash and cash equivalents
Receivables:
Interest and dividends
Total receivables
Investments, at fair value:
United States treasuries
United States agency notes
Domestic corporate bonds
Domestic corporate equities
Total investments
Total assets
LL4BII,ITIES
Refunds payable
Total liabilities
NET ASSETS
Held in trust for pension benefits
City of Sebastian, Florida
Statement of Fiduciary Net Assets
Fiduciary Funds
September 30, 2007
Pension
Trust
Police
Officers'
Pension
S 828,845
26,042
854,887
837,043
492,004
536,640
2,916,202
4,781,889
5,636,776
Agency
Pertbrmance
Deposits
$ 170,730
170,730
170,730
170,730
170,730
S 5,636,776 ~ -
The accompanying notes to fmanciat statements aze an integral part of IUis financial statetnent.
27
City of Sebastian, Florida
Statement of Changes in Fiduciary Net Assets
Fiduciary Fund -Pension Trust
For the Year Ended September 30, 2007
Police
Officers'
Pension
ADDITIONS
Contributions:
Employer $ 294,534
Plan memb ers 103, 227
State 117,621
Total contributions ~ 15,382
Investment earnings:
Net increase in fair value of inveshnents 413,377
Interest and dividends 170,261
Total investment earnings 583,638
Less investment expenses (30,379)
Net investment earnings 553,259
Total additions 1,068,641
DEDUCTIONS
Benefits 110,677
Refunded contributions 20,146
Administrative expenses 12,336
Total deductions 143,159
Change in net assets 925,482
Net assets - beginning of year 4,711,294
Net assets -end of year $ 5,636,776
The accompanying notes to financial stateanen[s are an integral part of this financial statement.
28
i
1
City of Sebastian, Florida
Notes to the Financial Statements
September 30, 2007
' I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
' The City of Sebastian (the "City"), a Florida Municipal Corporation, was incorporated in 1924 under Sections 1826-1832 of ttte Revised
Florida Statutes. The City has a population of 22,426 living in an area of approximately 14.6 square miles. The governing body is a five
member elected City Comicil 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 li.S. generally accepted accounting principles as applied to
governmental units. The more significant of the City's accounting policies are described below:
' A. Reporting Entitti
In evaluanng the City as a reporting entity, management has included all component units in accordance with Governmental
Accounting Standards Board (GASB) Statemem No. 14, "Defining the Financial Reporting Entity" and Statement No. 39 - an
' amendment of GASB No. 14. The Financial Reporting Entity consists of the City of SeUastian (the primary government) and its
blended component units. Blended component units are legally separate organizations for which the City Council is £nancially
accountable. The component units discussed below are included in the City's reporting entity.
' Blended Component Units
The following component units are blended with the primary government for financial statement purposes because the component
1 unit's governing body is substantially the same as [he City Council or because the component unit exclusively serves the City. The
financial statements of these component units maybe obtained from the Finance Depatttnent of the City oC Sebastran.
Cormnunity Redevelopment Agency (CRA) -The governing body of the CRA is the Sebastian City Council. The CRA is accounted
' for in a special revenue fund entitled "Riverfront Redevelopment". F.S. Section 163.387(8) requires an independent audit of the ftmd
each fiscal year and a report of such audit. The City has presented the CRA as a major fund of the City to satisfy this requnement
simply due to the scope of the audit for a major fund is broader than anon-major fund.
City of Sebastian Police Officers' Pension Plan -The City Council only appoints two of the five members of the governing board,
but it is financially responsible for funding the police officers' pension benefits. The City of Sebastian Police Officers' Pension Trust
Fund only exists [o provide pension benefits to City of Sebastian police officers. It is accounted for as a Pension Trust fund entitled
"Police Officers' Pension".
B. Government-wide and fund financial statements
The government-wide financial statements (i.e., the statement of net assets and the statement of changes in net assets) report
' information on all of the nonfiduciary activities of the primary government and its blended component units. For the most part, the
effect of interftmd activity has been removed from these statements. Coverronerrtol activities, which normally are supported by taxes
and intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent on fees and
charges for support.
' Separate fund financial statements are provided for governmental funds, proprietary funds, and &duciary funds, even though the latter
are excluded from the government-wide f nancial statements. Major individual governmental fiords and major individual enterprise
' funds are reported as separate columns in the fund financial statements.
GASB Statement No. 34 Basic Financial Statements and Management Discussion and Analysis for State and Local Governments sets
forth minimum criteria (percentage of the assets, liabilities, revenues or expenditures/expenses of either fund category or the
' governmental and enterprise funds combined) For [he determination of major funds. The nonmajor funds arc combined in a colmnn
in the fund financial statements and detailed in [he combining section.
C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation
1. Economic Resources Measurement Focus and Accrual Basis of Accounting
The government-wide financial statements are reported using the economic resources measurenxent,~ocus and the acenm! basis
' of accounting as are the proprietary fund and fiduciary fund financial statements. This means that revenues are recorded when
earned and expenses are recorded when a liability is incurred, regardless of the tuning of the related cash flows. Property taxes
are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as
' all eligibility requirements imposed by [he provider have been me[.
29
[n applying the "susceptible [o accrual" concept to intergovernmental revenues pursuant [o GASB Statement No. 33, Accounting
and Financial Reporting for Nonexchanee Transactions as amended by GASB Statement No. 36, Recipient Reporting of Certain
Shared Nonexchanee Revenues (the City may ac[ as either provider or recipient), the provider should recognize liabilities and
expenses and the recipient should recognize receivables and revenue when the applicable eligibility requirements including time
requirements, are met. Resources transmitted before the eligibility requirements are met should, under most circumstances, be
reported as advances by the provider and deferred revenue by the recipient.
Private-sector standards of accounting and financial reporting issued prior to December 1, 1989, generally are followed in both
the govemment-wide and proprietary fund financial statements to the extent that those standards do not cont7ict with or
contradict guidance of the Governmental Accounting Standards Board. Governments also have the optiaz of following
subsequent private-sector guidance for their business-type activities and enterprise funds, subject to this same limitation. The
govemment has elected not to follow subsequent private-sector guidance.
As a general rule the effect of interfund activity has been eliminated from the govemment-wide financial statements.
The statement of activities demonstrates the degree to which the direct expenses of a given function or segment are offset by
program revenues. Direct expenses are those that are clearly identifiable with a speci£c function or segment. Progrmn
revenues include 1) charges to customers or applicants who purchase, use, or directly benefit from goads, services, or privileges
provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operational or capital
requirements of a particular function or segment Taxes and other items not properly included among program revenues are
reported instead as general revenues.
Proprietary funds distinguish operating revenues and expenses from nonoperoting items. Operating revenues and expenses
generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal
ongoing operations. The principal operating revenues of the golf course fund and the building fund are charges to customers for
services and for the airport fund ]ease revenue. Operating expenses for enterprise funds include cost of sales and services,
administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported
as nonoperating revenues and expenses.
The agency fund reports only assets and liabilities; therefore, it does not have a measurement focus. However, it uses [he accrual
basis of accounting [o recognize receivables and payables-
2. Modified Accrual
Governmental fund financial statements are reported using the eurreru financial resources measurement focus and the mod fed
accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. "Available" means
collectible within the current period or soon enough [hereafter [o be used to pay liabilities of the current period. For this
purpose, the City considers revenues to be available if they are collected within sixty (60) days of the end of the current fiscal
period except grant revenues. The City considers grant revenues to be available if they are collected within one year of the end
of the current fiscal period. All material revenues, except for 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 I, 2007. Expenditures are generally
recognized under the modified accrual basis of accounting when the related fund liability is incurred, if measurable. An
exception to this general rule is principal and interest on general long-term obligations, which are recognized when due.
1
1
1
t
Property taxes, public utility taxes, franchise fees, sales and fuel taxes, licenses, and interest associated with the current fiscal
period are all considered [o be susceptible to accrual and so have been recognized as revenues in the current fiscal period. Only '
the portion of special assessments receivable due within the current fiscal period is considered to be susceptible to accrual as
revenue of the current period. All other revenue items are considered to be measurable and available only when cash is received
by the City.
The govemment reports the following major governmental funds:
The genera! fund is the government's primary operating fund. It accounts for all financial resources of the
general government, except [hose required to be accounted for in another fund.
The discretionary sales tax fund accounts for the financial resources used for infrastructure improvements
and equipment purchases.
The riverfront redevelopment fwd accounts for tax increment revenues [hat are legally restricted for the
redevelopment of the City's riverfront area.
The transportation improvements fund accounts for transportation related construction such as, roads,
intersections, and sidewalks and is funded with governmental resources, impact fees, local option gas tax, and
state grants.
30
LJ
1
1
1
1
~~
The stormwater utility improvements fund accounts for the resources associated with debt and stormwater
assessment fees for the purpose of constructing stormwater related improvements.
The government reports the following major proprietary funds:
The goljcourse fund accounts for the activities of the municipal golf cow~se.
The airport fund accounts for the activities of the municipality's general aviation airport.
The building fund accounts for the activities associated with the building permit and inspection program.
Additionally, the government reports the following fund types:
The pension trust fund accounts for the activities of the Police Officer's Retirement System, which
accumulates resources for pension benefit payments to qualiFed police officers.
The performance deposits jmd accounts for deposits placed by bidders and developers to guarantee
performance pursuant to bid or contract. These funds are held by the City as agent for individuals and
businesses.
D. Assets, Liabilities and Fund Euuity
I. Cash and cash equivalents
Cash and cash equivalents represents all investments that are short term, highly liquid, and readily convertible to a specified
cash value. These investments generally have original maturities of three months or less. Cash equivalents consist of cash in
banks and on hand.
2. Investments
Investments consist of U.S. Treasury Securities, U.S. Government Agency Securities, common stock, guaranteed investment
contracts and the Local Government Surplus Funds Trust Fund 6ivesnnent pool (Pool). The Local Govenunen[ Sutylus Funds
Trust Fund is administered by the Florida State Board of Administration, which is not a registrant with [he Securities and
Exchange Commission. However, the Board has adopted operating procedures consistent with the requirements far a 2a-7 fund.
In accordance with the regulations of 2a-7 tike pools, the City's share of investments held at the State Board of Adminisnation
are reported at amortized cost, which approximates fair value. This pool is regulated by the State and [he fair value of the
position in the pool is the same as the value of the pool share. Investment eaznings of the Pool are allocated to [he participating
funds at [he end of each month based upon the ratio of each participant's investment to the total pooled investments. Except for
the Pool, investments, including the Police Officers' Pension Fund, are reported at their fair value based on the quoted market
price or the best available information.
3. Interfund Receivables and Payables
' During the course of operations, transactions occur between individual funds that may result in amounts owed between funds.
Short-term interfund loans are reported as "due to and from other funds". Due to and from other funds are eliminated in the
Statement of Net Assets. There were no interfund loans between the Governmental funds and Proprietary funds as of September
30, 2007.
Advances between funds, as reported in the fund financial statements, are offset by a fund balance reserve account in applicable
governmental funds to indicate that they are not available for appropriation and are not expendable available financial resources.
As of September 30, 2007, the general fund has $200,000 advance to the airport fund.
4. Receivables
1 Receivables consist of trade receivables, due from other governments and interest receivable (see Note IV C on page 38 For
detail) and are recorded at the net realizable value. The City, as of September 30, 2007, has no allowance for doubtful accounts,
since all receivables are considered collectible.
' S. Inventory and Prepaid Items
Inventory is valued a[ cost using the average cost method. Inventory in the General fund consists of materials and supplies held
for consumption. The cost is recorded as an expenditure/expense at the time the individual inventory items are consumed.
' Inventory in the Golf Course fund consists of supplies held for resale.
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both
government-wide and fund financial statements.
31
6. Restricted Assets
Certain net assets of the City are classified as restricted assets on the statement of net assets because [heir use is limited either by '
law through constitutional provision or enabling legislation; or by restrictions imposed externally by creditors, grantors,
contributors, or laws or regulations of other governments. [n a fund with both restricted and unrestricted assets, qualified
expenses are considered [o be paid first from restricted net assets and then from unrestricted net assets. '
7. Capital Assets
Capital assets, which include land, buildings, improvements, equipment, and infrastructure assets (e.g., roads, bridges, ,
sidew-allcs, and similar items), are reported in the applicable governmental or business-type activities columns in the
govermment-wide financial statements. The City defines capital assets as assets with an initial, individual cost of more than
5750 and an estimated useful life in excess of one year. Such assets are recorded at historical cost, if purchased, and at fair
market value at date of gift, if donated. Major additions are capitalized while maintenance and repairs that do not improve or '
extend the life of the respective assets are expensed.
All infrastructure assets acquired prior [o the implementation of GASB Statement 34 were capitalized as projects and were
completed or assets were acquired. Therefore, the initial capitalization of general infrastructure assets was no[ necessary. '
Capital asset depreciation is recognized using the straight-line method over the estimated useful lives as follows:
Classification Ranee of Lives
Buildings and improvements 10-40 years '
Public domain infrastructure 40-50 years
System infrastructure 15-30 years
Improvements other than buildings 10-40 years
Machinery, equipment and other 5-IS years ,
Airport runways 20 years
8. Compensated Absences '
[t is the City's policy to pemrit employees to accumulate earned but unused vacation and sick leave benefits and are accounted
for using the termination payment method. All vacation and sick leave amounts are accrued in the govemment-wide and
proprietary ftnancial statements. A liability for these amounts is reported in governmental funds only if they have matured, for '
example, as a result of employee resignations and retirements.
9. Lone-Term Liabilities
In the govemment-wide financial statements, and proprietazy fund types in the fund financial statements, long-term debt and
other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities, or
proprietary fund type statement of net assets. Bond premiums and discounts, as well as issuance costs, are deferred and
amortized over the life of the bonds using the straight-line method. Bands payable are recorded net of the applicable bond '
premium or discount. Bond issuance costs are reported as deferred chazges and amortized over the life of [he related debt. In
the fund financial statements, governmental fund types recognize bond premium and discounts, as well as debt issuance costs,
during the cupent period. The face amount of debt issued is reported as other financing sources. Premiums received on debt
issuances are reported as other &nancing sources while discounts on deb[ issuances are reported as other financing uses. '
Issuance casts, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures.
10. Fund Equity
In the fund fnancial statements, governmental funds report reservations of fund balance for amounts that are not available for
appropriation or are legally restricted by outside parties for use for a specific purpose. The nature and purpose of these reserves
are explained as follows: '
Reserved for encumbrance -represents encumbrances outstanding at year end that the City intends to
honor as commitmen[s_
Reserved for debt service -represents, in accordance with legal restrictions, amounts for payment of
principal and interest maturing in later yeazs.
Reserved for capital projects -represents amounts restricted for capital projects.
Reserved for property and casually -represents amounts restricted for property and casualty claims.
Reserved for cemetery care -represents amounts restricted for use in cemetery maintenance. '
ReserveAfor law enfaroemen! -represents, in accordance with State Statutes, funds required to be spent
on drug education and awareness activities.
Reserved for emergency services -represents amount restricted for natural disasters.
Reserver! far equipment replacement -represents amounts restricted for the replacement of capital assets. '
32 '
Designations of unreserved fund balances are not required by law or accounting principles, but are further classifications of fiord
' equity to identify funds that are not earmarked for specific purposes.
II. RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS
' A. Explanation of Differences Between the Governmental Fund Balance Sheet and the Government-wide Statement
of Net Assets
' The governmental fund balance sheet includes reconciliation between fund balance-total governmental junds and net assets-
governmental activities as reported in the government-wide statement of net assets.
"Total fund balances" of the City's governmental funds ($20,01 ],838) differs from '4te[ assets" of governmental activities
' ($36,!38,583) reported in the statement of net assets. This difference primarily results from the long-term economic focus of the
statement of net assets versus the current financial resources focus of the govemmental fund balance sheet. The effect of the
differences is illustrated below.
1
1
f~
1
Caoital related items
When capital assets (property, plant, equipment) that are [o be used in the governmental activities are purchased or constructed, the
cost of those assets are reported as expenditures in governmental funds. However, the statement of net assets included those capital
assets among [he assets of the City as a whole.
Cost of capital assets
Accumulated depreciation
Total
$ 49,854,027
(t6.91z.uat
$ 3294] 913
Net pension obligation
V/hedne[ pension obligation is a negative amount, the amount is presented as an asset on the statement of net assets.
Negative net pension obligation
Other oost emplovment and termination benefits
Accrued other post employment and termination benefits are not financial uses, therefore, are not reported in [he fund.
Other post employment benefits
Termination benefits
Total
$ (248,477)
(40,379)
$ (288.8561
Lone-term debt transactions
Long-term liabilities applicable to the City's governmental activities are not due and payable in the current period and accordingly
are not reported as fund liabilities (both current and long-term) are reported in the statement of net assets. Balances at September 30,
2007 were:
Bonds payable:
lnfras[ructure sales surtax revenue bonds,
Series 2003 $(7,405,000)
Less: Deferred charge for issuance costs 204,677
Infrastructure sales surtax revenue bonds,
Series 2003A (1,740,000)
' Less: Deferred charge for issuance costs 80,069
Stormwater utility revenue bonds,
Series 2003 (4,815,000)
Less: Deferred charge for issuance costs 160,101
Less: Deferred charge for bond discounts 12,082
Notes payable (1,566,840)
Less: Deferred charge for issuance costs 4,485
Capital lease payable (]47,539)
' Less: Deferred charge for issuance casts 1.509
Contamination liability
' Compensated absences
Total
$(7,200,323)
(1,659,931)
(4,642,817)
(1,562,355)
(146,030)
(91,200)
f 1.178.2251
$(16480.8811
33
Accrued interest
Accrued liabilities in the statement of net assets differs from the amount reported in governmental funds due [o accrued interest on
bands payable, notes payable, and capital lease. '
Bonds $ (246,756)
Notes (6,521)
Capital lease (3.8031
Total $ (257.0801
Accrued receivable
Some interest receivable s are not financial resources in the current period, therefore, are not reported in the funds.
Interest receivables $ 85 888
Deferred revenues '
Deferred revenues m [he statement of net assets differ from the amount reported in the governmental funds due to special assessment
receivables. Governmental fund financial statements report unearned revenues or revenues which are measurable but not available as
deferred revenues. However, deferred revenues in governments( funds aze susceptible to full accrual on government-wide financial '
statements.
Deferred revenues reduced $ 3 849
B. Explanation of Differences Between the Governmental Fund Statement of Revenues, Expenditures, and Chances '
in Fund Balances and the Government-wide Statement of Activities
The "net change in fund balances" for governmental funds (a decrease of $(,906,693) differs from the "change in net assets" for
governmental activities (an increase of $2,196,440) reported in the statement of activities. The differences arise primarily from the ,
long-term economic focus of the statement of activities versus the current £nancial resources focus of the governmental funds. The
effect of the differences is illustrated below.
Interest receivables
Some interest revenues reported in [he statement of activities do not constitute current financial resources, therefore, are not reported
as revenues in governmental funds.
Interest receivables $ 85.888 '
Capital related items
When capital assets that are to be used in governmental activities are purchased or constructed, the resources expended for those
assets are reported as expenditures in governmental funds. However, in the statement of activities, the costs of those assets is '
allocated over their estimated useful lives and reported as depreciation expense. As a result, fund balances decrease by the amount of
financial resources expended, whereas net assets decrease by the amount of depreciation expense charged for the year.
Capital outlay $ 5,404,581 '
Depreciation expense (2.100,6951
Difference 3
In the statement of activities, the gain and loss on the sale and disposal of capital assets are reported. However, in the governmental '
funds, only the proceeds from the sale increase financial resources.
Loss on disposal of fixed assets S f6 1081 ,
Pension obligation
When net pension obligation is a negative amount, the amount represents over funding and reduces the expenses in the statement of
activities.
Decrease in negative net pension obligation S (26.6951 '
Lone-term debt transactions
Repayments of bond principal, notes payable principal, and capital lease principal are reported as expenditures in the governmental ,
funds and, thus, have the effect of reducing fund balance because current financial resources have been used. However, the principal
payments reduce the liabilities in the statement of net assets and do not result in an expense in the statement of activities.
Bond principal payment made $ 920,000 ,
Notes payable principal payment made 2?3,704
Capital lease principal payment made 140 713
Total L~ '
34 '
Some expenses reported in the statement of activities do not require the use of current financial resources, therefore, are not reported
' as expenditures in governmental funds.
Vet change m compensated absences $ (133,555)
Net accrued bond interest expense 12,044
' Net accrued notes interest expense 3,650
Net acemed capital tease interest expense 91 D
Amortization of issuance costs (41,248)
Other post employment benefits (248,477)
' Termination benefits (40,379)
Contamination liabilities (9I 2001
Net adjustment $ (538 2551
' III. STEWARDSHIP, CONH'LIAN'CE, AND ACCOUNTABILITY
Budeetarv Intorma6on
' Budgets are prepared annually on a modified accrual basis with encumbrance accounting for all governmental funds except the capital
project funds, which are approved on a "life of the project basis", and the permanent fund, which is not budgeted. All annual
appropriatwns lapse at year end.
On or before the third Friday in May of each year, all agencies of the government submit requests for appropriations to the government's
City Manager so that a budget may be prepared. Before July 31, the proposed budget is presented to the government's council For review.
The council holds budget workshops and public hearings and a final budge[ must be prepared and adopted no Later than September 30.
Encumbrance accounting, under which purchase orders, contracts, and other conunitments for the expenditure of monies are recorded in
' order to reserve that portion of the applicab]e appropriation, is employed as an extension of formal budgetary integration in the General,
Special Revenue, Debt Servrce, and Capital Projects funds. Encumbrances outstanding at year end are carried forward and reappropnated
to the next year's budget.
' Achtal results of operations presented in accordance with U.S. generally accepted accounting principles (GAAP basis) and the City's
accounting policies do not recognize encumbrances as expenditures until the period N which the actual goods or services are received and
a liability is incurred. It is necessary [o include budgetary encumbrances to reflect actual revenues and expenditures on a oasts consistent
with the City's legally adopted budget. (See page 52 through page 55)
' IV. DETAIL NOTES ON ALL FUNDS
A. Deposits
At September 3Q, 2007, the carrying amount of the City of Sebastian's deposits with banks was $468,038 and the bank balance was
$729,287. All the deposits were covered by the FDIC or collateralized in accordance with the "Florida Security for Public Deposits
Act". [lnder die Act, every qualified public depository shall deposit with the Treasurer eligible colfateral 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. [f the
' public deposits exceed the total amount of the regulatory capital accounts of a bank or the regulatory net worth of a savings
assoctahon, the required colfateral shall have a market value equal to 125°/ of [he deposits.
B. Investments
On April 23, 2003, Sebastian City Council formally adopted an investment policy pursuant [o Section 218.415, Florida Statutes that
established permitted investments, asset allocation limas and issuer limits, credit ratings requirements and manuity limits to protect
City's cash and investment assets. The City maintains a conunon cash and investment pool for the use of all funds. Pension Trust
' Funds are held with third party trustees and are governed by rules established by Florida Statute Chapter 135.
1
1
As of September 30, 2007, the City had the following investments and effective duration presented in terms of years
35
i
Investment Maturi ty (Year)
Investment Twe Fair Value Less Than I From I-3 From 4-6 Over 7
Government-wide '
C.S Agencies $ 7,499,844 $ 4,499,844 S 3,000,000 $ - $ -
Guazanteeditrvestmentcontract 4,131,347 4,131,347 - - _
Certif cote of deposit
1,500,000
500,000
1,000,000
- ,
Loca1 government surplus fund trust
fund investment pool 9,096,573 9,096,573 - - -
22,227,764 18,227,764 4,000,000 - -
Fiduciary Funds
United States Treasuries 837,043 - 431,072 58,351 347,620
United States Agencies 492,004 - - - 492,004 ,
Domestic corporate bonds 536,640 - 189,860 92,396 254,384
Domestic corporate equities 2,916,202 2,9(6,202 - - -
4,781,889 2,916,202 62Q,932 150,747 1,094,008
Total fair value $ 27,009,653 $ 21,143,966 $ 4,620,932 $ 150,747 $ 1,094,008
Investment holdings consist of $7,499,844 in United States Government Agencies which are reported at fair value in accordance with '
GASB Statement No.3l "Accounting and Financial Reporting for Certain Investments and for External Investment Pools". These
investments are held in trust by the City's bank depository in the City's name.
Section 218.415, Florida Statutes, limits the types of investments [hat the City can invest in unless specially autlmrized in the City's ,
investment policy. The City has a formal investment policy that allows for the following investments: Florida Local Govemment
Surplus Funds Trust Fund, United States Govemment Securities, United States Govemment Agencies, Federal Instrumentalities,
Interest Bearing Time Deposit or Saving Accounts, Repurchase Agreements, Commercial Paper, High Grade Corporate Notes,
Bankers' Acceptances, State and/or Local Government Taxable and/or Tax-Exempt Debt, Registered Investment Companies (Money
Market Mutual Funds), and Intergovernmental Investment Pool.
Florida Statutes Chapter 185 regulates the types of investment that may be held by the Police Pension Trust Fund. The investment ,
guidelines have been augmented by City ordinance that have adopted specific investment policies. Compliance with the policies and
guidelines has been evaluated by the pension board.
Interest receivable on the govet'nrnent-wide and fiduciary inveshnent portfolios amounted to $160,693 and $26,042, respec[ivelg as '
of September 30, 2007.
Interest Rate Risk
' '
The City
s investment policy limits interest rate risk by attempting to match investment maturities with known cash needs and
anticipated cash flow requirements. Investment maturities shall not exceed thirty-six (36) months. Investments of construction funds
shall have a term appropriate to the need for funds and in accordance with debt covenants.
Included in the government-wide investment portfolio, the City has $7,499,844 in United States Government Agencies that have
embedded options consisting of the option at the discretion of the issuer to call their obligation or pay a stated increase in the interest
rate. These securities have different call dates, and mature in 2007, 2008, 2009, and 2010. '
Credit Risk
The City investment policy pernuts for investments in the following investments, which are limited to credit quality ratings from
nationally recognized agencies as follows: ,
Mutual funds shall be rated "m" or "AAm-G" or better by Standard & Poor's, or the equivalent by another rating agency. State and/or
local government taxable and'ortox-exempt debt, general obligation and/or revenue bonds, rated at least "Aa" by Moody's and "AA"
by Standard & Poor's for long-term debt, or rated at least "MIG-2" by Moody's and `SP-2" by Standard & Poor's for short-[errrt '
debt. Bankers' acceptances issued by a domestic bank or a federally chartered dotnes[ic office of a foreign bank, which are eligible
for purchase by the Federal Reserve System, at the time of purchase, the short-term paper is rated, at a minimum, "P-I" by Moody's
Investors Services and "A-1" Standard & Poor's. Commercial paper of any United States company that is rated, at [he time of
purchase, "Prime-I" by Moody's and "A-I" by Standard & Poor's (prime commercial paper). Corporate notes issued by corporations
organized and operafing within the United States or by depository institutions Licensed by the United States that have a Tong term debt
rating, at the time of purchase, at a minimun "Aa" by Moody's and a minimum long term debt rating of "AA" by Standard & Poor's.
As of September 30, 2007, the City's investment securities were all individually rated AAA by Standard & Poor's and Aaa by '
Moody's Investor Services.
36
The City's $9,096,573 investment deposit in the Local Government SurpWs Funds Trust Fund investment pool was unrated as of
September 3Q, 2007.
The City's $4,13!,}47 guaranteed investment contract represents the investment of construction funds, which has a term appropriate
[o the need for funds and in accordance with debt covenants. The investment contract is with Royal Bank of Canada, which is
Aal/AA-rated Company. The investment was unrated as of September 30, 2007.
Investment in the City's pension [rust funds are limited by State Statutes Chapter 185 and by an im~estment policy adopted by the
fund's Board of Trustees. The allowable investment instruments include United States Govemment Obligations, Certificates of
Deposit, and Repurchase Agreements with major money center banks, Commercial Paper rated A-I by Standard & Poor's or P-I by
Moody's or better, with the exception of the custodian's savings account. In addition, common stocks and equity securities having
prospects of attractive returns from a combination of appreciation are also allowed.
Custodial Credit Risk
The City's investment policy pursuant to Section 218.415(18), Florida Statutes requires securities, with the exception of certificates
of deposits, shall be held with a third party custodian; and all securities purchased by, and all collateral obtained by the City should
be properly designated as an asset of the City. The securities must be held in an account separate and apart from the assets of the
financial institution. A third party custodian is defined as any bank depository chartered by the Federal Govemment, the Stale of
Florida, or any other state or territory of the United States which has a branch or principal place of business in the State of Florida as
defined in Section 658.12, Florida Statutes, or by a national association organized and existing under [he laws of the United States,
which is authorized to accept and execute trusts and which is doing business in the State of Florida. Certificates of deposits
maintained by book-entry at the issuing bank shall clearly identify the City as the owner.
As of September 30, 2007, the City's investment portfolio was held with athird-party custodian as required by the City's investment
policy.
Concentration of Credit Risk
The City's investment policy has established asset allocation and issuer limits on the following investments, which are designed to
reduce concentration of credit risk of the City's investment portfolio.
A maximum of 100% of available funds may be invested in the SBA and in the United States Govemment Securities, 50% of
available funds may be invested in United States Govemment agencies with a 25% limit on individual issuers, 80% of available
funds may be invested in Federal Instrumentalities with a 40% limit on individual issuers, 25% of available funds may be invested in
non-negoCiable interest bearing time certificates of deposits with a 15°/ limits on individual issuers, 50°/ of available funds may be
invested in repurchase agreements excluding one (1) business day agreements and overnight sweep agreements with a 25°/ limit on
any one institution, 25% of available funds may be directly invested in prime commercial paper with a 10°/ lino[ on individual
issuers, 15% of available funds may be directly invested in corporate notes with a 5% limit on individual issuers, 25% of available
funds may be directly invested in Bankers' Acceptances with a 10% limit on individual issuers, 20% of available funds may be
invested in taxable and tax-exempt debts, 50% of available funds maybe invested in money market mutual fund with a 25% limit on
individual issuers, 10% of available funds may be invested in intergovernmental investment pools.
The City's pension trust funds investment policy adopted by the fund's Board of Trustees has established asset allocation and issuer
limits on the following investments, which are designed [o focus on performance.
A maximum of 100% of available funds may be invested in fixed income securities and a maximum of 50% of available funds may
be invested in equity securities.
As of September 30, 2007, the City had the following issuer concentration based on fair value:
Issuer
Local government surplus funds trust
fund ("SBA")
United States Treasuries
United States Agencies
Guaranteed investment contract
Certificate of deposit
Domestic corporate bands
Domestic corporate equities
Total
Government-wide Fiduciarv Funds
Percentage of Percentage of
Amount Portfolio Amount Portfolio
$ 9,096,573 40.92% $ -
- 0.00% 837,043
7,499,844 33.74% 492,004
4,13 L,347 18.59% -
I,500,000 6.75% -
- 0.00% 536,640
- 0.00% 2,916,202
$ 22,227,764 100.00% S 4,781,889
0.00%
17.50°
10.30°
0.00°
0.00°
1 1.22%
60.98°
100.00%
37
u
C. Receivable and Payable Balances
Receivables
Receivables at September 30, 2007 were as follows:
Governmental activities:
General
Discretionary sales tax
Riverfront redevelopment
Stonmvater utility improvements
Transportation improvements
Other governmental
Total -governmental activities
Business-type activities
Golf course
Airport
Building
Total -business-type activities
All receivables are anticipated to be collected.
Payables
Due From
Other
Interest Accounts Governments Total
$ 117,100 $ 227,950 $ 270,501 $ 615,881
7,298 - 211,167 218,465
2,331 - - 2,331
5,514 - 2,797 8,311
277 - - 277
20,670 - 73,229 93,899
$ 153,190 $ 227,950 $ 557,694 S 938,834
$ 63 $ - S - $ 63
127 11,896 210,334 226,357
7,313 - - 7,313
$ 7,503 $ 15,896 S 210,334 $ 233,733
Payables at September 30, 2007 were as follows:
Governmental activities:
General
Discretionary sales tax
Riverfront redevelopment
Transportation Improvements
Stonnwa[er utility improvements
Other governmental
Total -governmental activities
Business-type activities:
Golf course
Airport
Building
Total -business-type activities
Salaries Due to
and Other
Vendors Retainage Benefits Government Total
S 314,938 $ - $ 397,065 $ 84,560 $ 796,563
45 - - - 4S
3,101 - - - 3,101
427,154 - - - 427,154
118,802 88,965 - - 207,767
68,790 38,692 - - 107,482
$ 932,830 $ 127,657 $ 397,065 $ 84,560 S 1,542,112
$ 34,366 $ - $ 11,339 S 7,279 $ 52,984
92,084 17,286 6,781 321 IL6,472
17,374 - 1L,754 - 29,128
$ 143,824 $ 17,286 $ 29,874 $ 7,600 $ 198,584
Governmental funds report deferred revenue in co[mection with receivables for revenues that are not considered to be available to
liquidate liabilities of the current period. Governmental fiords also defer revenue recognition in connection with resources that have
been received, but not yet earned. At September 30, 2007, the various components of deferred revenues and unearned revenue
reported in the governmental fonds were as follows:
Deferred Unearned
Revenues Revemies
Special assessments not yet due (General fund) $ 3,849 $ -
Occupational licenses received in advance (General Fund) - 65,054
Total deferrediunearned revenue for governmental funds $ 3,849 $ 65,054
t
38
i
i
D. Capital Assets
Capital asset activity for the year ended September 3Q 2007 was as follows:
Beginning Ending
Balance Increases Decreases Balance
Governmental activities:
Capital assets, not being depreciated:
Land $ 5,301,947 $ 394,999 $ - $ 5,696,946
Construction in progress 1,167,207 3,803,663 (2,278,166) 2,692,704
Total capital assets, not being depreciated 6,469,!54 4,198,662 (2,278,166) 8,389,650
Capital assets, being depreciated:
Buildings 9,958,190 1,038,307 - 10,996,497
Improvements other than buildings 4,614,326 361,968 (5,6%) 4,970,638
Machinery and equipment 6,436,238 709,863 (326,050) 6,820,051
Infrastructure 17,375,199 1,373,947 (7L,955) 18,677,191
Total capital assets being depreciated 38,383,953 3,484,085 (403,661) 41,464,377
Less accumulated depreciation for:
Buildings (!,585,266) (326,371) - (1,911,637)
Improvements other than buildings (1,166,996) (238,417) 4,713 (1,400,700)
Machinery and equipment (4,502,294) (851,020) 320,885 (5,032,429)
Infrastructure (7,954,416) (684,887) 71,955 (8,567,348)
Total accumulated depreciation (15,208,972) (2,100,695) 397,553 (16,912,114)
Total capital assets, being depreciated, net 23,174,981 ],383,390 (6,108) 24,552,263
Governmental activities capital assets, net $ 29,644,135 $ 5,582,052 $ (2,284,274) $ 32,941,913
Bcginning Ending
Balance Increases Decreases Balance
Business-type activities:
Capital assets, not being depreciated:
Land $. 9,060 $ - $ - $ 9,060
Construction in progress 2,770,936 610,631 (2,081,133) 1,300,434
Total capital assets, nor being depreciated 2,779,996 610,631 (2,081,133) 1,309,494
Capital assets, being depreciated:
Buildings 1,832,148 1,400,324 - 3,232,472
Improvements other than buildings 1,181,052 96,571 (61,545) 1,216,078
Machinery and equipment 638,926 223,535 (57,996) 804,465
Infrastructure 6,012,963 320,403 (515,997) 5,817,369
Total capital assets being depreciated 9,665,089 2,040,833 (635,538) 11,070,384
Less accumulated depreciation for:
Buildings (356,730) (42,173) - (398,903)
Improvements other than buildings (235,270) (85,319) 52,882 (267,707)
Machinery and equipment (513,542) (52,466) 57,996 (508,012)
Infrastmcture (1,431,029) (277,297) Sli,997 (1,192,329)
Total accumulated depreciation (2,536,571) (457,255) 626,875 (2,366,951)
Total capital assets, being depreciated, net 7,128,5 l8 1,583,578 (8,663) 8,703,433
Business-type activities capital assets, net $ 9,908,5 I4 $ 2,194,209 $ (2,089,796) 5 10,012,927
39
Depreciation expense was charged to functions/programs of the government as follows:
Governmental activities:
General government
Public safety
Transportation
Physical environment
Crd [oral and recreation
Total depreciation expense-governmental activities
Business-type activities:
Golf Course
Airport
Building
Total depreciation expense-business-type activities
Construction Commitments
$ 362,013
450,720
407,511
536,203
344,248
$ 2,100,695
$ 81,607
36Q120
11,528
$ 457,255
The City has various construction commitments outstanding a[ September 30, 2007. The major eonsn-uetion convninnents include the
following:
Project
Main Street Twin Ditches Improvements
Nutrient Separating Baffle Box
Municipal Airport Maintenance Building
Total
E. Advances
Remaining
Spent-to date Cotnmihnent
$ 1,059,761 $ 96,444
L5,367 137,588
338,702 130,320
5 1,413,830 $ 364,352
Advance balances at September 3Q 2007 consisted of the following amount
Advance from General Fund to:
Major
Funding Source
Debt Proceeds - Stormwater Revenue Bonds,
Series 2003
Stormwater Utility Fund
FAA Grant
Airport Fund 3 200,000
Total 5 200,000
The balance of $200,000 advance to the airport fund from the general fund represents a cash loan that is expected to be repaid within
the next twelve months.
F. Interfund Transfers
Transfers are used to I) move revenuesfrom the fund that stahrte or budget requires to collect them to the fund that statute or budget
requires to expend them, and 2) utilize discretionary sales tax revenues for infrastructure improvements and equipment purchases
which must be accounted for in other funds. Following is a schedule of Interfund Transfers:
Transfer Out:
-Cransfers [m
General Fund
Discretionary Sales Tax Fund
Transportation Improvements
Stormwater Utility Improvements
Nonmajor Governmental Funds
Total Transfers Out
Discretionary Nonmajor
Sales Tax Governmental Airport
Fund Funds Fund Total
$ ?19,738 $ 505,122 $ - 5 727,860
- 474,594 42,720 517,314
407,501 617,348 - L,024,849
653,415 453,744 - 1,107,159
1,309,561 514,273 - 1,823,834
$ 2,590,215 $ 2,SGS,081 $ 42,720 $ 5,201,016
r
l 1
i
i
40
1
1
1
t
1
1
1
G. Leases
1. Ouerating Leases-Lessee
The City is obligated under certain leases far land and golf carts accounted for as operating leases. Operating teases do not give rise
to property rights or lease obligations. Total costs for such leases were $224,035 for the fiscal year ended September 30, 2007. 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, 2007:
Golf Course
Gotf
Year Ending September 30, to: Airport Carts
2008 $ 171,000 $ 71,820
2009 (75,000 71,820
2010 175,000 132,075
2011 250,000 -
2012 250,000 -
2013-2015 750,000 -
Totals $ 1,775,000 $ 275,711
2. Capital Leases-Lessee
The City has entered into a lease agreement as lessee for financing [he acquisition of heavy construction equipment for its public
works department. This lease agreement qualifies as a capital lease for accounting purposes and, therefore, has been recorded at the
present value of its future minimum lease payments as of [he inception date.
The property being leased is included in the statement of net assets governmental activities column and has a cost of $859,859 and a
carrying value of $187,619. Far fiscal year 2007, total depreciation expense for the ]eased equipment is $132,246. The assets
acquired through the capital ]ease are as follows:
Activities
Asset:
Machinery and equipment $ 859,859
Less: Accumulated depreciation (672,240)
Total $ 187,619
The future minimum lease obligations and the net present value of these minimum lease payments as of September 30, 2007 were as
follows:
Governmemal
Year Ending September 30, Activities
2008 154,694
Total minimum lease payments 154,694
Less: amount representing interest (7,155)
Present value of minimum lease payments $ 147,539
3. Operating Leases-Lessor
The City is the lessor of two communication tower leases with lease terms of up to fifty-five years. The towers has a cost of $39,285
and a carrying value of $10,540. For fiscal year 2007, total depreciation expense for the leased towers is 51,964. Following is a
schedule by year of minimum future rental income on noncancelable operating leases:
41
Governmental
Year Ending September 30 Activities
2008 $ 58,674
2009 59,798
2010 60,967
2011 62,182
2012 66,326
2013-2017 351,890
2018-2022 389,087
2023-2027 354,943
2028-2032 414,315
2033-2037 486,551
2038-2042 574,436
2048-2052 811,454
2053-2055 560,802
Total minimum future rentals $ 4,255,424
The airport is the lessor of various properties (land with a cost basis of $9,060) with lease terms varying from twenty to thirty years. '
Following is a schedule by year of minimum future rental income on noncancelable operating leases:
Business-type
Year Ending September 30, Activities
2008 282,132
2D09 284,847
2010 287,636
2011 365,594
2012 368,895
2013-2017 1,368,267
2018-2022 606,577
2023-2027 695,795
2028-2032 731,177
2033-2037 371,876
Total minimum future rentals- $ 5,362,795
H. Lone-term Obligations
1. Revenue Bonds/Notes
Revenue bonds/notes are secured by and payable from the revenues of the respective funds that issued them.
a. The City entered into a fifteen (l5) 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.
b. The City issued a ten (l0) year, $2,435,000 Recreational Facilities Improvement and Refunding Revenue Bonds, Series
2001 in March 2001. The City has pledged Golf Course revenues along with a covenant to budget and appropriate for
repayment of principal and interest.
c. The Ciry issued a fifteen (I S) year, $9,500,000 Infrastructure Sales Surax Revenue Bonds, Series 2003 in Apri] 2003. The
City has pledged Infrastructure Sales Surtax revenues for repayment of principal and interest.
d. The City issued a fifteen (IS) year, $2,125,000 Infrastructure Sales Surtax Revenue Bonds, Series 20039 in December
2003. The City has pledged Infrastructure Sales Surtax revenues for repayment of principal and interest.
e. The City issued a nineteen (l9) year, $5,630,000 Stormwater Utility Revenue Bonds, Series 2003 in November 2003. The
City has pledged Stormwater Fee Revenues along with a covenant to budget and appropriate for repayment of principal and
interest.
42
1
1
t
1
2. Bond Coverage
a. The City !ras covenanted in the Recreational Facilities Improvement and Refunding Revenue Bonds, Series 2001 Bond
Resolution to fix, establish and maintain such rates, fees, rentals and other charges and collect such fees, rates, rentals, and
other charges for the product, services, faci]ities and use of its facilities, and revise the same from time to time, whenever
' necessary, as swill always provide in each fiscal year net revenues equal to at leas[ one hundred twenty-five percent (125%j
of the annual deb[ service becouaing due in such fiscal year.
' The following table indicates the degree of compliance with the bond resolution covenants in the Golf Course Fund ar
September 3Q, 2007.
Gross revemes available Cor compliance (charges $ 1,701,171
Cor services, interest, and rent revenues)
Opearnng acrd maintenance
expenses (excluding depremanon expense, amortization,
and airport lease payment) 1,218,33?
' Amount of revenue over
direct operatingcxpenses $ 482,749
Debt service requirement $ 306,590
' Percen[coverzge for [he year
ended September 30, 2007 157
' City management continues to monitor the Golf Course operation and intends to adjust rates whenever necessary to meet
the bond coverage regmrement.
' b. The City has covenanted in fire stormwater Utility Revenue Bonds, Series 2003 Bond Resolution to Ex, establish, maintain
and collect stormwater fees, and revue the same 6~om tmze to time whenever necessary, so as to always provide in each
Esca] year stormwater fee revenues and investment eanungs equal to at least one hundred thirty-five percent (13S%) of the
annual debt service becoming due in each Hscal year.
The following table indicates the degree of compliance with the bond resolution covenants in the stormwater utility fund at
September 30, 2007.
Gross revenues available tt-or compliance S 932,183
Debt service requrement S 437,273
' Percent coverage for the year
ended September 3Q, ?007 213'/°
3. Changes in Lone-term Liabilities
The following is a swnmary of changes in Loner Term Liabilities of the City for the year ended September 30, 2007:
43
Beginning Ending Due within
Balance Additions Reductions Balance One Year
Governmental activities:
Bonds payable'.
L~fras[ructure Sales Surtax Revenue
Bonds, Series 2003 $ 7,955,000 $ - 3 550,000 S 7,405,000 $ 565,000
Infrastructure Sales Surtax Revenue
Bonds, Series 20039 1,870,000 - 130,000 1,740,000 135,000
Stnrmwater Utility Revenue Bonds,
Series 2003 5,055,000 - 240,000 4,815,000 245,000
Less deferred amount:
Issuance discount- S[ortnwater Utility Revenue
Bonds, Selies 2003 (12,915) - (833) Q2,082) -
To[al bonds payable 14,867,085 - 919,167 13,947,918 945,000
Notes payable 1,790,544 - 223,704 1,566,840 233,601
Capital leases 288,252 - 140,713 147,539 147,539
Compensated absences 1,044,670 705,416 57L,861 1,178,225 91,518
Unfunded OPEB obligation - 248,477 - 248,477 -
Terminationbenefus - 40,379 - 40,379 19,580
Govenunen[al activity
long term Iiabilites $ 17,990,551 $ 994,272 S 1,855,445 S 17,129,378 $ 1,437,238
Beginning Ending Due within
Balance Additions Reductions Balance One Year
Business-type activities:
Bonds payable .
Recreational Facilities Improvement and
Refunding Revenue Rands, Selies 2001 S 1,140,000 $ - S - S 1,14Q000 $ 270,000
Less defen'ed amount:
Issuance premium 3,190 - 798 2,392 -
Loss on refunding (33,288) - (8,322) (24,966) -
To[albondspayable 1,109,902 - (7,524) 1,117,426 270,000
Compensated absences 148,846 79,462 80,864 147,444 9,900
Unfunded OPEB obligation - 33,365 - 33,3fi5 -
Tertninationbene8ts - 37,663 - 37,663 L3,160
Business-type activity
long-term liabilites $ 1,258,748 $ 150,490 $ 73,340 $ 1,335,898 $ 293,060
For the govemmenta] activities, compensated absences are generally liquidated by the general fund.
4, Debt Service Requirements to Maturity
The annual requirement to amortize all bonded debt outstanding at September 3Q, 2007, including interest requirements, is as
follows:
44
1
Govenmental Activities
Roadway Infrastructure Infrastructure Stormwater
Improvement SalesSurtax SalesBurtax lltility
tio[e Revenue Bonds, Revenue Boods, Revenue Bonds,
Fiscal Payable Series 2003 Series 2003A Series 2003
Year 4.40% Interest 2%to 4.125% Interest 2%to 4% buerest 2%to 4S% hVeres[
2008 233,598 66,402 565,000 269,819 135,000 63,800 245,000 191,873
2009 243,990 56,010 585,000 252,869 135,000 60,088 255,000 185,135
2010 254,843 45,157 600,000 233,856 145,000 56,037 260,000 177,485
2011 266,180 33,820 620,000 214,356 145,000 51,325 270,000 169,035
2012 278,019 21,981 645,000 193,276 150,000 46,250 280,000 L59,247
3013-2017 290,2 L0 9,790 3,585,000 593,784 845,000 141,013 L,575,000 621,955
2018-2022 - - 805,000 33,206 185,000 7,400 1,93Q,000 266,685
$ L,566,840 $ 233,160 $ 7,405,000 $ 1,791,166 $ 1,740,000 $ 425,9 L3 $ 4,815,000 $ 1,771,415
Business-type Activities
Golf Course
Refunding
Bonds,
Fiscal Series 200 t
Year 4% [0 4.2 % Lrterest
2008 270,000 41,090
2009 280,000 30,090
2010 290,000 18,545
2011 700,000 6,300
Less unamor[ized
Band premium 2,392 -
Loss on refunding (24,966) -
$ 1,117,426 $ 96,025
I. Restricted Assets:
' Certain cash and claims to cash, that are legally restricted, have been shown as restricted in the statement of net assets as follows:
t
Debt service
Capital projects
Renewal and replacement
Rent
Cemetery perpetual care
Law enforcement forfeiture fund
Community redevelopment agency
Total
Govennental
Activities
$ 231,894
8, l 11,666
a 1,ao0
175,000
694,506 -
25,098 -
355,965 -
S 9,419,129 $ 570,890
Business-type
The government-wide statement of net assets reports $9,990,019 of restricted net assets, of which all is restricted by enabling
legislation.
V. OTHER INFORMATION
A. Property Tax
The City is permitted by State law to levy taxes up [0 10 nulls on assessed valuation. The millage rate levied by the City for the
fiscal year ended September 30, 2007, was 3.0519 nulls. Total tax collections were approximately 95.36°/ of the total tax levy.
45
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 b'alorem taxes are liened on '
property values as of January 1. The fiscal year for which taxes are levied begins October 1. Taxes are due November 1 and become
delinquent on April L All taxes unpaid as of May 30 are subject to a tax certificate sale. Property tax revenues are recognized in the
fiscal year far which they aze levied and also become due and payable.
B. Grants from Other Governmental Units
Federal, State and local government grants represent an important source of supplementary funding used to finance inliastructure,
recreation, law enforcement, and environmental activities beneficial to the community. These grants are recorded in the Genera], '
Special Revenue, Capital Project, and Enterprise funds. A grant receivable is recorded when the City has a right to reimbursement
and expects [o receive the gran[ within a year under the related grant. The grants normally specify the purpose for which the funds
maybe used and are subject to audit by the grantor agency or its representative.
The following is the amount of grant revenue for fiscal year 2007.
Primary Govemment Amount
General government $ 14,919
Public safety 5,152
Transportation 18,018
Cultural/Recreation 224,395
Airport 500,428
Total reporting entity $ 762,912
C. Police Pension Plan -Defined Benefit Plan
Plan Description. The Police Officers' Pension Plan is a Florida Statute Chapter 185 single-employer defined benefit plan. Only
City police officers participate in the Police Pension Plan. The state provides a contribution to the Police Pension Plan through a
distribution of funds collected from insurance premium taxes. The Pension plan data provided in these Financial Statements are from
the actuarial report dated October 23, 2007. Although the Police Officers' Pension Plan provides separate reporting, which may be
obtained in the Finance department, i[ is also a component unit (reporting as a Pension Trust Fund) of the City's financial reporting
entity.
Employee membership data as of the actuarial report for period ending October I, 2006, dated October 23, 2007 is as follows:
Retirees and beneficiaries currently
Police Pension
Plan 2006
receiving benefits 4
Terminated employees entitled [o
refund of employee contribution
but not yet received 1
Fully, partially, and non-vested
active plan participants 37
Total 42
Benefit Provisions and Contribution Re9uirements. The Police Officers' Pension Plan provides retirement and disability benefits to
plan members and beneficiaries. This Plan is administered by a separate local Board of Trustees. Chapter 185, Florida Statutes, as ,
amended governs all benefit provisions of the Plan. Contribution requirements, in accordance with Chapter 185, Florida Statutes, are
established by Cit}' ordinance, as provided in Chapter 58, Article III of the Sebastian City Code. The City Council has the authority
to amend funding requirements.
Funding Policy The employer, employee, and Stale contribution requirements are applicable to the Plan and actuarially determined
on a bi-annual basis in accordance with Florida State Statute. Administration costs of the pension plan are financed by the Plan. The
employee contribution rate, expressed as a percentage of compensation, was 5.0% for the 2006-2007 fiscal year. The employer
contribution rate, expressed as a percentage of compensation, was 14.25% for the 2006-2007 fiscal year. The employer contribution
is $294,534 and the State contribution is $f 17,621, which represents state shared revenue that is levied on property and casualty
insurance premiums and collected by the State. The State contribution was recognized and recorded in the general fund and the
corresponding expenditure was recorded as public safety expenditure. The City is required to contribute the remaining amounts to
ensure that the Plan is actuarially sound.
Annual pension costs and related information was as follows:
46
1
Contribution rates as of 9/30/06
City
Plan members
Annual pension cost
Contributions made
Valuation date
Actuarial cost method
Amortization method
Remaining amortization period
Asset valuation method
1~.5%
5.0°/a
$ 243,301
$ 219,898
10/1!2004
Frozen Entry Age
Level Percentage of Pay, Closed
28 Years (as of 10/01/2004)
Market Value
Required trend information for [he Police Officers' Pension Plan was as follows:
Amount
Actuarially Deterrnined Contribution
2004 $ 173,025
2005 $ 212,636
2006 S 243,301
' Percentaee of APC contributed
2004 LO1.00%
2005 l 13.00°ib
2006 90.00%
Since the employer contribution exceeded the annual pension costs, there is no net pension obligation for the plan.
The annual required contribution for the Police Officers' Pension Plan was detenxtined as par[ of the October 1, 2007, actuarial
' valuation using the aggregate actuarial cost method. This method does not identify or separately amortize unfunded actuarial accrued
liabilities. The actuazial assumptions included (a) an 8.0% rate of return (net of administrative costs) and (b) projected salary
increases of 6% per year, including inflation at 3%. There is no unfunded actuarial accrued liability as of September 30, 2007.
' Reserves All of the net assets of the Police Pension Plan are legally reserved for plan participant benefits.
Basis of Accounting. Financial statements are prepazed using the accrual basis of accounting. Plan member contributions are
recognized in the period in which the contributions are due. Employer contributions are recognized when due, and the employer has
' made formal commitment to provide the contributions. Benefits and refunds are recognized when due and payable in accordance
with the terms of [he Plan.
Method Used to Value fn vestments and Concentration ojlrrvestmenis. Investments are reported at fair value. Short-term investments
' are reported a[ 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 bass of future principal and interest payments, and are
discounted at prevailing interest rates for similar instruments. Investments that do not have an established market are reported at
estimated fair value. Investments in securities of a single organization (excluding mutual funds and those issued or guaranteed by the
1 U S government) held by the pension plan did not exceed five percent of the total plan assets.
Development of Net Pension Obligation (NPO)
This municipal Defined Benefit Plan has been subject to the minimum funding standards since the adoption of [he "Florida Protection
of Public Employee Retirement Benefit AcP' (Part VII of Chapter l t2, 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 hP0 on October 1, 1997, is $0.
The funding status as required by GASB Statements No. 25 and 27 is presented in the required supplemental information section on
page 46.
' The development of the Net Pension Obligation as of September 30, 2007 is as follows:
47
Actuarially Determined Contribution (A)
bueres[ on NPO
Adjustment to (A)
Annual Pension Cos[
ContriUu[ions made
9/30/2004 9/30/2005 9130/2006
173,025 3 212,636 $ 243,301
(9,760) (9,794) plsa9)
L1,100 lt,t38 15,181
]'74,365 213,980 246,593
174,780 240,167 2]9,698
Increase in NPO
NPO beginning of year
NPO end of year
(415) (26,187) 26,695
(12z,oa5) pzz,a2o) (14s,6D7)
~ (lzz,azo) ~ (14a,6o7) $ (121,912)
D. CWA / ITU Negotiated Pension Plan -Defined Benefit Plan
Plan Description: The CWA/ITU Negotiated Pension Plan (NPP), which began in 1967, is amulti-employer, defined benefit plan.
The Ptan is available to any Communication Workers of America (CWA) bargaining unit member, and benefits are portable from one
contributing employer to another.
Benefits
Normal Pension: Minimum age 65: S years of Service Credit required if any portion of service credit was earned after January 1,
1989. ID yeazs of Service Credit required if employees' coverage ended before Jatmary 1, 1989. Once the Service Credit amount is
accrued, the employee is vested and cannot lose the right to a pension.
Early Pension: Minimum age 60: 20 years of Service Credit required if employed after Januazy 1, 1989. 2S years of Service Credit
required if employment ended before January I, 1993. Pension amounts are permanently reduced based on age on the effective date,
because the pay~nen[s are expected to be made for a longer period of time.
Disability Pension, No minimum age and the pension amount is not reduced for age; there must be a Social Security Disability
Award, ]0 years o£ actual Service Credit and a contribution for covered employment must have been made within five calendar years
preceding the entitlement date to Social Security Disability Pension. An application must be filed with the Plan within G months of
the Social Security Notice of Award date to receive pension retroactive to the Social Security entitlement date.
1
Lump Sum Disability Benefit If the employee is in receipt of a Social Security Disability Award and is vested, but not invnediately
eligible to receive any pension described above, the employee may be eligible for a lump sum equal to total contributions credited on ,
the employees behalf (or 36 times the Normal Pension amount, if greater). If the employee is immediately eligible for a pension but
not yet receiving one, the employee can still qualify for a lump sum if the employee submits two physicians' written statements [hat
[he disability will lead to death within one year of the date of application.
Death Benefit: If the employee dies before becoming a pensioner and has at lease $250 contributed on the employees' behalf, a lump '
sum death benefit equal to total contributions credited on [he employees' behalf or 36 times the Normal Pension amount, if greater,
will be paid to employees' beneficiary. If the employee is married at the time of death, the spouse will have the choice of a lump sum
or a monthly survivor benefit. '
Withdrawal Benefit: If the employee did not earn enough Service Credit to qualify for a Normal Pension, the employee may be
eligible for a lump sum withdrawal benefit, based on total contributions, after the employee has incurred a break in service.
Benefit Provisions and Contribution Re9uirements: The NPP provides retirement and disability benefits to plan members and '
beneficiaries. The plan is administered at the Plan Office in Colorado Springs, Colorado. Contribution requirements are established
by the CWA contract, effective date October 1, 2006, which is negotiated every 3 years, and approved by City Council.
Funding Policy: Administration costs of the pension plan are financed by the plan. The employer contribution rate, expressed as a
percentage of compensation, was 9.00% for the 2006-2007 fiscal year. Employees do not contribute to this plan. Contributions to the
CWA Pension Plan for the fiscal years ended September 30, 2005, 2006 and 2007 were $216,464, $229,159, and 254,909
respectively, which are equal to 100% of the required contribution for each year. '
E. 401 Plan -Defined Contribution Plan
Plan Descriptior: The [CMA Retirement Corporation's 401 Retirement Plan is a Defined Contribution Plan "qualified" under '
Section 401(a) of the Internal Revenue Code. Each participant has a plan account to which contributions are made. Plan benefits are
based on the total amount of money in the employees' account at retirement or other eligible event. The Plan is available to atl
48 '
L~
management staff of [he City of Sebastian, and may be rolled over to another "qualified" employer plan that accepts rollovers, or
Traditional IRA's.
Benefits
Periodic Payments: Retirement benefits can be paid monthly, quarterly, semi-annual (at six-month intervals only) or amoral
payments until assets are fldty paid out.
Rollover: Retirement benefits can be rolled over to another employer plan (including a 457 deferred compensation plan) that accepts
rollovers, or to a Traditional IRA.
Lump Sum: Retirement benefits can paid either partially or by total distribufion of the employees' account balance.
Anmiities: Retirement benefits can be utilized to purchase an annuity.
Bereft H~ovisions and Conu~(bertion Reryuirenaents: The 401 provides retirement benefits to plan members and beneficiaries. The
plan is administered by the [CMA Retirement Corporation. Contribution requirements are established by the City of Sebastian,
Management Benefit Package, revised October I, 2003, and approved by the City Manager.
Funding Policy: Administration costs of the pension plan are financed by the Plan. The employer contribution rate, expressed as a
percentage of compensation, was 9.00% for the 2006-2007 fiscal year. Employees do not contribute to :his Plan. Contributions to
[he 401 Refined Contribution Plan for the fiscal years ended September 3Q, 2005, 2006, and 2007 were S146,840, $142,002, and
$136,222 respectively, which are equal to 100°/ of the required contribution for each year.
F. Other Post Emplovment Benefits (OPEBI
Pursuant to Section t 12.0801, Florida Statutes, the City is required to permit participation in the health insurance program by retirees
and their eligible dependents at a cost to the retiree that is no greater than the cost at which coverage is available for active
employees. The City, by policy, has elected to provide qualified retirees with partial subsidy.
Employees are eligible to receive benefits from the Retiree Medical Plan upon retirement, if they are enrolled in the active medical
plan immediately prior to retiring and at leas[ 20 years of service in a full time capacity. The City pays 50% of the costs of single
coverage group health insurance for up [0 2 years after retirement. No retirees are currently receiving medi;,al benefits.
Based on GASB Statement 43 and 4i, which set forth the guidelines and a ftiCUre implementation timetable (for the Ciry in fiscal year
2008/2009) for treatment of Other Post Employment Benefits. The City had an actuary calculate ftrture funding requirements in 2007.
The purpose was to enhance the City's understanding of the OPEB obligation and to revisit potential policy implications associated
therewith. 'Che actuary's 2007 estimate, using the Projected Unit Credit Method, produced an unfunded obligation of $281,842 and an
amwal required contribution of 540,089. The City has elected to fund [he OPEB obligation on apay-as-you-go basis. The entire
unfunded obhgation is recognized in the government-wide financial statements. The enterprise fund portion ($33,365) is also
recognized in the enterprise fund financial statements.
G. Termination Benefits
The City offered its employees an one time only early retirement incentive program in 2006-2007 fiscal year. The eligibi Gty
requirements are that the employee is either an exempt management employee or an hourly employee including police officers with
at least l5 years of service in a full time capacity and within three years reaching the age of 65 (the age eligible for Medicare benefit).
The benefits include a one time lump sum payment based on the year of service and single coverage group health insurance for up to
3 years after retirement. The lump sum payment is calculated by multiplying $1,000 for each full yeaz of service. The group health
insurance will terminate when the retiree reaches the age of 65 and eligible for Medicare benefits. As of September 30, 2007, the mtal
aeemed tenarination benefits for the government-wide financial statements are $45,302. The enterprise fund portion ($24,503) is also
recognized in the enterprise fund nnancial statements.
H. insurance
' The City is exposed to various risks of loss related to torts; theft of or damage to and destruction of asset=; errors and omissian.a; and
natural disasters. The City purchases conmtercial insurance with various deductibles for different types of losses. The cost of this
insurance is accounted for in the general fund, golf course fund, auport fund, and building fiord. Settled claims have not exceeded
this commercial coverage in Che past three fiscal years.
' L Lineation
Various suits and claims are currently pending against the City. It is impossible for the City m accurately quantify the exposure
' involved given the jury's latitude in assessing compensatory and punitive damages, and the court's latitude in awarding attorney's
fees. The City intends to vigorousty defend against these lawsuits and believes i[ has a good chance of prevailing on their meats.
' 49
The City is contingently liable with respect to lawsuits and other claims incidental [o Che ordinary course of its operations. [n the
opinion of management and based on the advice of legal counsel,. the ultimate disposition of lawsuits will not have a material adverse
effect on the financial position of the City. '
J. Grants
Amounts received or receivable from grantor agencies are subject to audit and adjustment by grantor agencies If any expenditures ,
were disallowed as a result of these audits, the claims for reimbursement to the grantor agency would become a liability of the Ciry.
In the opinion of management, any such adjustments would not be significant.
K
S
b
E
t '
.
u
sequent
ven
As discussed in Note IV. B, at September 3Q 2007, the city had $9,096,573 invested in [he State Board of Administration's Local
Government Surplus Funds Trust Fund Investment Pool (Pool). On November 29, 2007, the State Board of Administration '
implemented a temporary freeze on the assets held in the Pool due to an unprecedented amount of withdrawals from the
Fund coupled with the absence of market liquidity for certain securities within the Pool. The significant amount of withdrawals
followed reports that the Pool held asset-backed convnercial paper that was subject to sub prime mortgage risk. On December 4,
2007, based on recommendations from an outside financial advisor, the State Board of Adtninis[ration restructured the Pool into two '
separate pools. Pool A consisted of all money market appropriate assets, which was approximately $12 billion or 86°/ of Pool
assets. Pool B consisted of assets that either defaulted on a payment, paid more slowly than expected, and/or had any significant
credit and liquidity risk, which was approximately $2 billion or 14°io of Pool assets. At the time of the restructuring, all current pool '
participants had their existing balances proportionately allocated into Pool A and Pool B.
Currently, Pool A participants may withdraw 37% of their balance or $4 nvllion, whichever is greater, without penalty. Withdrawals
from Pool A in excess of the above limit are subject to a 2% redemption fee. New investments in Pool A are not subject to the t
redemption fee or withdrawal restrictions. Future withdrawal provisions from Pool A will be subject to further evaluation based on
the maturities of existing investments and the liquidity requirements of the Poo]. On December 21, 2007, Standard and Poor's
Ratings Services assigned its "AAAM" principal stability fund rating to Pool A.
Currently, Pool B participants are prohibited from withdrawing any amount from the Poo] and a formal withdrawal policy has not yet ,
been developed. Market valuations of [he assets held in Pool B are not readily available. In addition, full realization of the principle
value of Pool B as<.ets is not readily determinable.
As of December 31, ?007, the city has 53,590,5 L3 and $995,804 invested in Pool A and B, respectively. Additional information
regarding the Local Governmem Surplus Funds Tms[ Fund maybe obtained from the Stale Board of Administration.
1
$~
Supplemental Information
City of Sebastian, Florida
Schedule of Revenues, Expenditures, and Changes in Fund Balances -Budget and Actual
General Fund
For the Year Ended September 30, 2007
Amounts
Original Final
REVENUES:
Taxes:
Property $ 4,539,000 $ 4,539,000
Public utility 2,1&2,027 2,182,027
Franchise fees 960,475 960,475
Licenses and permits 231,200 231,200
Intergovernmental 2,380,000 2,512,541
Charges for services 441,342 464,334
Fines 55,90D 55,900
Investment earnings 273,762 273,762
Contributions and donations 20,500 34,620
Other revenue 103,300 130,070
Total revenues 11,187,506 l 1,383,929
EXPENDITURES:
Current:
General government 3,161,61 I 3,246,326
Public safety 4,699,494 5,071,128
Physical environment 1,572,140 1,674,728
Transportation 1,627,449 1,769,236
Culture and recreation 1,057,256 1,059,202
Total expenditures [2,117,950 ~ 12,821,020
Excess (deficiency) of revenues
over (under) expenditures (930,444) (1,437,091)
OTHER FINANCING
SOURCES
Transfers in 736,192 781,422
Total other financing sources 736,192 781,422
Net changes in fund balances (194,252) (655,669)
Fund balances -beginning 6,479,072 6,479,072
Residual fund equity transfer - -
Fund balances -ending $ 6,284,820 $ 5,823,40]
Explanation of differences:
Encumbrances for equipment and supplies orde red but not received are reported in the year
the orders are placed for budgetary purposes, bu t are reported in the yea r the equipment and
supplies are received for GAAP purposes.
Current year encumbrances
Prior year encumbrances
Amount reported as ending fund balance in the statement of revenues, e xpenditures and
changes in fund balance for the General Fund.
Actual Variance with
Amounts on Final Budget -
a Budgetary Positive
Basis (Negative)
$ 4,537,1D0 $ (1,900)
2,216,38E 34,354
1,106,698 L46,223
186,875 (44,325]
2,221,215 (291,326)
387,058 (77,276)
64,404 8,564
34Q7>9 66,997
32,876 (1,744)
170,174 40,104
3,055,114 191,212
4,963,851 107,677
1,492,845 181,883
1,551,364 217,872
1,021,048 38,154
¢,084,222 736,798
(820,622) 616,469
727,860 (53,562)
727,860 (53,562)
(92,762) 562,907
6,479,072 -
52 52
6,38G,362 S 562,959
62,445
(58,020)
S 6,390,787
The accompanying notes to required supplementary information are an integral part of this schedule.
52
1
1
1
1
City of Sebastian, Florida
Schedule of Revenue, Expenditures, and Changes in Fund Balances -Budget and Actual
Discretionary Sales Tax Special Revenue Fund
For the Year Ended September 30, 2007
REVENUES:
Taxes:
Sales
Investment earnings
Total revenues
OTHER FINANCING SOURCES (USES)
Transfers in
Transfers out
Tota( other financing sources (uses)
Ne[ changes in fiord balances
Fund balances -beginning
Fund balances -ending
Actual Variance wifh
Budget Amounts Amounts on Final Budget -
a Budgetary Positive
Original Final Basis (Negative)
$ 3,127,000 $ 3,127,000 $ 2,560,310 $ (566,690)
113,300 113,300 120,198 6,898
3,240,300 3,240,300 2,680,508 (559,792)
- 474,594 474,594 -
(3,240,300) (2,600,559) (2,547,495) 53,064
(3,240,300) (2,125,965) (2,072,901) 53,064
- 1,114,335 607,607 (506,728)
1,804,332 1,804,332 1,804,332 -
$ 1,804,332 $ 2,918,667 S 2,411,939 $ (506,728)
The accompanying notes to required supplementary information are an integral part of this schedule.
53
City of Sebastian, Florida
Schedule of Revenue, Expenditures, and Changes in Fund Balances -Budget and Actual
Riverfront Redevelopment Agency Special Revenue Fund
For the Year Ended September 30, 2007
REVENUES:
Taxes:
Property
Investment earnings
Other revenue
Total revenues
EXPENDITURES:
Current
Economic environment
Capital outlay
Total expenditures
Excess of revenues over
over expenditures
OTHER FINANCING USES
Transfers out
Total other financing (uses)
Net changes in fund balances
Fund balances -beginning
Fund balances -ending
Actual Variance with
Budget Amounts Amounts on Final Budget -
a Budgetary Positive
Original Final Basis (Negafive)
$ 593,329 $ 593,329 S 552,741 $ (40,588)
24,000 24,000 33,209 9,209
- - 100 loo
617,329 617,329 586,050 (31,279)
132,844 159,086 80,279 78,807
95,256 716,072 620,815 95,257
228,100 875,158 701,094 174,064
389,229 (257,829) (115,044) 142,785
- (275,40 L) (215,401) -
- (2li,40L) (215,401) -
389,229 (473,230) (330,445) 142,785
1
1
1
675,417 675,417 675,417 -
$ 1,064,646 $ 202,187 344,972 $ 142,785 '
Explanation of differences:
Encumbrances for professional services contracted but not completed is reported in the
year the service is contracted far budgetary purposes, but are reported in the year the
services are received for GAAP purposes.
Current year encumbrances
Prior year encumbrances
Amount reported as ending fund balance in the statement of revenues, expenditures and
changes in fund balance for the Riverfront Redevelopment Agency Fund.
106,249
(95,216)
S 355,965
1
The accompanying notes to required supplementary information are an integral part of this schedule.
54 '
City of Sebastian, Florida
Notes to the Required Supplementary Information -Budget Comparisons
September 30, 2007
' A. Budeetarv Basis
Annual budgets are adopted for all governmental funds except the capital project fiords, which are approved on a "life of
the project basis", and the permanent fiord, which is no[ budgeted. Since al] accounting principles applied for purposes
of developing data on a budgetary basis differ significantly from those used to present financial statements in conformity
with U.S. generally accepted accounting principles, reconciliations of the resultant [inung differences have been
provided on page 51 tluough page 53. All annual appropriations lapse at year-end.
B. Budgetarv Information
' The appropriated budget is prepared by fund, function, and department. The govetnment's department heads, with the
City manager's approval, may make transfers of appropriations within a department or division. Transfers of
appropriations between departments and/or divisions require approval of the City council. The legal level of budgetary
control (i. e., the level at which expenditures may not legally exceed appropriations) is the fund level. The council made
' four supplementary budgetary appropriations tluoughout the year. The 1" quarter budget amendment highlighted a net
increase of $58,020 for the general fund, which represents fund balance carried over from prior fiscal year to fund
outstanding encumbrances. The 2°a quarter budget amendment highlighted a net increase of 531,813 for the general
fund, which represents FEMA reimbursement received in the 2°a quarter for hurricane damage. The 3`a quarter budget
amendment highlighted a net increase of $26,770 for the general fiord, which represents the proceeds generated from
surplus equipment sales. The 4~' quarter budget amendment highlighted a net increase of $490,155 for the general fiord.
The main reason for this increase is 1) to recognize a pass through police pension contribution from the State, 2) to fund
' the additional police pension contribution required by the State, and 3) to fund the costs associated with the employee
early retirement program.
' C. Budgeted Expenditures Exceeded Revenues
Budgeted expendimres exceeded revenues in the general fund, riverfront redevelopment agency special revenue fund,
stormwater utility special revenue fund, and the law enforcement forfeiture special revenue fund. However, this is
' pursuant to the legally adopted budget to expend available fund equity (cash carry forward) and does not constitute a
deficit.
1
1
55
City of Sebastian, Florida
REQUIRED SUPPLEMENTARY INFORMATION
Police Officers' Pension Plan
Govemmental Accounting Standards Board Statements No. 25 and 27, Financial Reoortin~ for Defined Benefit
Pension Plans and Note Disclosures for Defined Contribution Plans and Accountine for Pensions by State and Local
Govemmental 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:
SCHEDULE OF CONTRIBUTIONS FROM THE EMPLOYER
AND OTHER CONTRIBUTING ENTITIES
LAST SIX FISCAL YEARS
Annual
Fiscal Required City State Percentage
Year Contributions Contribution Contribution Contributed
2006 $ 360,922 $ 219,898 $ 117,621 93.52%
2005 330,257 240,166 117,621 108.34%
2004 279,741 174,780 106,716 100.63%
2003 233,435 153,111 92,714 (05.31%
2002 61,342 8,620 82,877 149.16%
2001 80,740 29,134 68,646 121.10%
56
i
1
1
S
t
1
~ Nonmajor Governmental Funds
r
57
Special Revenue Funds
Special revenue funds are used to account for specific revenues that are legally restricted to expenditures for
particular purposes.
Local Option Gas Tax Fund -This fund is used to account for the government's share of motor fuel tax revenues
that are legally restricted to transportation related expenditures within the government's boundaries.
Recreation Impact Fee Fund -This fund is used to account for recreation impact fees that are restricted for use in
the expansion or construction of recreational facilities.
Stormwater Utility Fee Fund -This fund is used to account for fees collected on a per unit basis that are restricted
for the purposes of managing the City's Stormwater system.
Law Enforcement Forfeiture Fund -This fund is used to account for the receipt of forfeited cash and equipment
associated with police activities and is restricted to police related equipment purchases and community education
initiatives.
G.R.E.A.T. Program Fund -This fund is used to account for a federal law enforcement grant to be used for gang
resistance, education and training for school children from grade school through middle school.
Debt Service Fund
Debt service funds are used to account for the accumulation of pledged funds that are legally restricted to pay
debts.
Stormwater Utility Revenue Bonds Debt Service Fund -This fund is used to account for the accumulation of
stormwater utility fees pledged to pay the principal, interest, and fiscal charges on the Stomrwater Utility Revenue
Bonds.
Discretionary Sales Surtax Revenue Bonds Debt Service Fund -This fund is used to account for the accumulation
of discretionary sales tax monies pledged to pay the principal, interest, and fiscal charges on the Discretionary
Sales Surtax Revenue bonds.
Capital Projects Funds
Capital projects funds are used to account for the acquisition and construction of major capital facilities other than
those financed by proprietary funds.
Genera] Capital Projects Fund -This fund is used to
improvements and general capital construction projects.
used to finance the improvements in this fund.
~~
t
account for the construction of non-stormwater related
Governmental resources and State grant revenues are
Capita] Improvements Fund -This fund is used to account for the accumulated resources associated with
infrastructure improvements such as parks and building.
Public Facilities Improvements Fund -This fund accounts for the resources associated with debt for the purpose
of constructing and equipping a new city hall complex and renovation and expansion of the police station.
58
' Permanent Fuud
' Permanent funds aze used to report resources that are legally restricted to the extent that only earnings, not
principal, may be used for purposes that support the reporting government's programs.
Cemetery Permanent Fund -This Fund is used to account for principal trust amounts received, sale of cemetery
lots and related interest income. One-half of the cemetery lot sales and the interest portion of the trust can be used
to maintain the community cemetery.
i
1
i
r
i
1
' S9
City of Sebastian, Florida
Combining Balance Sheet
Nonmajor Governmental Funds
September 30, 2007
Special Revenue Funds
Local Law
Option Recreatio^ Stormwater Enforcement G.R.E.A.T.
Gas Taz Impact Fee Utility Forfeiture Program
ASSETS
Cash and cash equivalents $ 12,477 $ 3,609 $ 22,043 S 1,017 $ 889
Investments 97,586 1,317,514 1,122,011 23,186 -
Due from other governments 62,347 - 10,882 - -
Interest receivable 1,468 4,006 6,666 3 3
Total assets $ 173,878 $ 1,325,129 $ 1,16(,602 $ 24,206 $ 892
LIAB[LITIES AND FUND BALANCES
Liabilities:
Accounts payable $ 1,044 $ 40 $ 32 $ - $ -
Retainage payable - - - - -
Total liabilities 1,044 40 32 - -
Fund balances:
Reserved for:
Encumbrance - - - - -
Debt service - - - - -
Capital projects - - - - -
Cemetery care - - - - -
Law enforcement - - - 24,206 892
Unreserved 172,834 1,325,089 I,t61,570 - -
Total fund balances 172,834 1,325,089 1,161,570 24,206 892
Total liabilities and fund balances $ 173,878 $ 1,325,129 $ 1,161,602 $ 24,206 $ 892
60
1
1
'
Debt Service Funds
Starmwater Discretionary
' Utli[y Sales Surtax
Revenue Revenue
Total Bonds 2003 Bonds 2003 Total
' S 40,035 $ 677 $ 590 $ 1,267
2,560,297 19,862 210,761 230,623
73,229 - - -
12,146 2 2 4
S 2,685,707 $ 20,541 $ 211,353 $ 231,894
'
' $ 1
116 $ - $ - 5 -
,
1,116 - -
1
2Q54t 2IL,353 231,894
25,098
'
2,659,493 _ _ _
2,684,591 20,541 211,353 231,894
$ 2,685,707 $ 2Q541 $ 211,353 $ 231,894
1
' 61
City of Sebastian, Florida
Combining Balance Sheet
Nonmajor Governmental Funds
September 30, 2007
(Continued)
Capital Projects Funds Permanent
Fund
General Public
Capital Capital Facilities
Projects Improvements Improvements Tatal Cemetery
ASSETS
Cash and cash equivalents $ 1,910 $ 37,380 $ 67,210 $ 106,500 $ 3,696
Investments 6,900 666,957 - 673,857 690,104
Due from other governments - - - - -
[nterest receivable 168 7,601 - 7,769 75 t
Total assets $ 8,978 $ 711,938 $ 67,210 $ 788,126 $ 694,551
LIABILITIES AND FUND BALAYCES
Liabilities:
Accounts payable $ 6,157 $ 54,888 $ 6,584 $ 67,629 $ 45
Retainage payable - - 38,692 38,692 -
Total liabilities 6,157 54,888 45,276 106,321 45
Fund balances:
2eserved far:
Encumbrance - 27,175 21,934 49,109 -
Debt service - - - - -
Capital projects 2,821 629,875 632,696 -
Cemetery care - - - - 694,506
Law enforcement - - - - -
Unreserved - - - - -
Total fund balances 2,821 657,050 21,934 681,805 694,506
Total liabilities and fund balances $ 8,978 $ 711,938 $ 67,210 $ 788,126 $ 694,551
62
1
1
1
To[al
' Other
Governmental
Funds
' $ 151,498
4,154,881
' 73,229
20,670
t $- 4,400,278
' $ 68,790
38,692
' (07,482
t
49, l09
23!,894
632,696
694,506
t 25,098
2,659,493
4,292,796
S 4,400,278
1
63
City of Sebastian, Florida
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended September 30, 2007
Revenue Funds
Community Local Law
Development Option Recreation Stormwater Enforcement
Block Grant Gas Tax Impact Fee Utility Forfeiture
REVENUES:
Taxes:
Motor fuel $ - $ 688,085 $ - $ - $ -
Intergovernmental - 18,018 - - -
Impact fzes - - 56,875 - -
Charges for services - - - 834,039 -
Fines - - - - 6,550
Investment earnings - 92,220 67,999 98,143 ],665
Contributions and donations - - - - 621
Other revenue - - - I 225
Total revenues - 798,323 124,874 932,183 9,361
EXPENDITURES
Cun ent
Public safety - - - - 17,494
Physical environment - - - 79 -
Transporta[ion - 195,375 - - -
Deb[ Service:
Principal - 223,704 - - -
Interes[ and fiscal charges - 76,296 - - -
Capital outlay - - - - -
Total expenditures - 495,375 - 79 17,494
Excess (deficiency) of revenues
over (under)expenditures - 302,948 124,874 932,104 (8,133)
OTHER FINANCING
SOURCES (USES)
Transfers in - - - - -
Transfersout - (262,571) (77,000) (1,357,593) -
Total other financing sources (uses) - (262,571) (77,000) (1,357,593) -
Net changes in fund balances - 40,377 47,874 (425,489) (8,133)
Fund balances -beginning S2 132,457 1,277,215 1,587,059 32,339
Residual fund equity transfer (52) - - - -
Fund balances -ending $ - $ 172,834 $ 1,325,089 $ 1,161,570 $ 24,206
64
1
Debt service Funds
' Stormwater
Utility Discretionary
Sales Surtax
G.R.E.A.T. Revenue Revenuc
Program Total Bonds 2003 Bands 2003 Total
$ - $ 688,Od5 $ - $ - $ -
= 18,018
56,875 - - -
- 834,039 - - -
' -
109 6,850
260,136 -
1,096 -
7,432 -
8,528
5,121 5,742 - - -
- 226 - - -
1
5,230 1,869,971 1,096 7,432 8,528
1
5,121 22,61$ - - -
79
-
195,375 - - -
- 223,704 240,000 680,000 920,000
' 76,29b 198,148 354,88E 513,029
S,l2l 518,069 438,148 1,034,881 1,473,029
109 1,351,902 (437,052) (1,027,449) (1,464,501)
' 1
470
479
- - 437,273 1,033,206 ,
,
- (1,697,164) - - -
- (1,697,164) 437,273 1,033,206 1,470,479
109 (345,262) 221 5,757 5,978
783 3,029,905 20,320 205,196 225,91G
- (12) - - -
$ 892 $ 2,684,591 $ 20,541 $ 211,353 $ 231,894
' 65
City of Sebastian, Florida
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended September 30, 2007
(Continued) '
Capital Proj ects Funds Permanent
General
Public Fund '
Capital Capital Facilities
Projects Improvements Improvements Total Cemetery
REVENUES:
Taxes: '
Motor fuel $ - $ - $ - S - $ -
Intergovemmenta] - - 224,395 224,395 -
Impact fees - - - - -
Charges for services - - - - 10,001
Fines
Imestmen[earnings - -
1,666 31,753 -
13,500 -
46,919 -
29,887 ,
Contributions and donations - 20,511 - 20,511 -
Other revenue - - - - -
291
826 892
79
Total revenues 1,666 52,264 237,891 , ,
EXPENDITURES: ,
Current
Public safety - - - - -
Physical environment - - - - -
Transportation - - - - -
Debt Service:
Principal 140,714 - - 14Q,714 -
Interest and fiscal charges 13,980 - - 13,980 -
Capital outlay 132,285 305,408 834,207 1,271,900 -
Total expenditures 286,979 305,408 834,207 1,426,594 - '
Excess (deficiency) of revenues
over (under) expenditures (285,313) (253,144) (596,312) (1,134,769) 79,892
OTHER FINANCING
SOURCES (USES)
Transfers in 276,951 76,404 - 353,315 -
Trnnsfersout (289,972) (323,998) - (613,970) (41,146)
Total other financing sources (uses) (13,021) (247,194) - (260,611) (41,546)
Net changes in fund balances
(298,334)
(100,738)
(196,312) (L,391,384) '
38,346
Fund balances- beginning 301,111 1,157,788 618,246 2,077,189 656,160
Kesidual fund equity transfer - - - - -
Fund balances -ending $ 2,821 $ 657,010 $ 21,934 $ 681,801 $ 694,506
66 ,
1
Total
Other
Governmental
Funds
8 688,085
242,413
56, 875
884,044
6,850
345,470
26,213
226
'
2,250,216
22,615
' 79
195,375
' 1,284,418
643,305
1,271,900
3,417,692
(1,167,476)
' 4
1,823,83
(2,352,680)
(528,846)
' (1,696,322)
5,989,170
(52)
$ 4,292,796
1
' 67
City of Sebastian, Florida
Schedule of Revenues, Expenditures, and Changes in Fund Balances -Budget and Actual
Local Option Gas Tax Special Revenue Fund
For the Year Ended September 30, 2007
REVENUES:
Motor fuel teees
Intergovernmental
Investment earnings
Total revenues
EXPENDITURES:
Curtest:
Transportation
Debt service.
Pruicipal
Intet'est and fiscal chat'ges
Total expendihues
Excess of revenues over expenditures
OTHER FINANCING (USES)
Transfers out
Total other financing (uses)
Net changes in fund balances
Actual Variance with
Amounts on Final Budget -
Final a Budgetary Positive
Budget Basis (Negative)
$ 720,000 $ 688,085 $ (31,915)
- 78,018 13,018
45,D00 92,220 47,220
765,000 798,323 33,323
202,429 195,375 7,054
223,646 223,704 (58)
76,354 76,296 58
502,429 49,375 7,054
262,571 302,948
(z6zs71) (26zsn)
(z6zs71) (z6zs71)
- 40,377
40,377
40,377
Fond balances -beginning 132,457 132,457 -
Fund balances - enduig $ 132,457 $ 17?,834 $ 40,377
68
1
1
1
City of Sebastian, Florida
Schedule of Revenues, Expenditures, and Changes in Fund Balances -Budget and Actual
Recreation Impact Fee Special Revenue Fund
For the Year Ended September 30, 2007
REVENUES:
Impact fees
Investment earnings
Total revenues
OTHER FINANCING (USES)
Transfers out
Total other financing (uses)
Net changes in fund balances
Fund balances -beginning
Fund balances -ending
Actual Variance with
Amounts on Final Budget -
Final a Budgetary Positive
Budget Basis (Negative)
$ 360,000 $ 56,875 $ (303,125)
45,000 67,999 22,999
405,000 124,874 (280,126)
(77,000) (77,000) -
(77,000) (77,000) -
328,000 47,874 (280,126)
1,277,215 1,277,215 -
$ 1,605,215 $ 1,325,089 $ (28Q,126)
69
City of Sebastian, Florida
Schedule of Revenues, Expenditures, and Changes in Fund Balances -Budget and Actual
Stormwater Utility Special Revenue Fund
For the Year Ended September 30, 2007
Actual Variance with
Amounts on Final Budget -
Final a Budgetary Positive
Budget Basis (Negative)
REVENUES:
Charges for services $ 820,000 $ 834,039 $ 14,039
Investment earnings 86,200 98,143 11,943
Miscellaneous - l I
Total revenues 906,200 932,183 25,983
EXPENDITURES:
Current
Physical environment
Total expenditures
Excess of revenues over expenditures
OTHER FINANCING (USES)
Transfers out
Total other financing (uses)
Net changes in fund balances
Fund balances -beginning
Fund balances -ending
3,500 79 3,421
3,500 79 3,421
902,700 932,104 29,404
(1,317,593) (1,357,593)
(1,317,193) (1,317,193)
(454,893) (421,489)
29,404
1,187,019 1,187,019 -
$ 1,132,166 $ 1,161,170 $ 29,404
7~
t
1
1
1
t
i
City of Sebastian, Florida
Schedule of Revenues, Expenditures, and Changes in Fund Balances -Budget and Actual
Law Enforcement Forfeiture Special Revenue Fund
For the Year Ended September 30, 2007
REVENUES:
Fines
Investment earnings
Contributions
Other revenues
Total revenues
EXPENDITURES:
Current:
Public safety
Tota] expenditures
Excess of revenues over expenditures
Ftrnd balances -beginning
Fund balances - euding
Actual Variance with
Amounts on Final Budget -
Final a Budgetary Positive
Budget Basis (Negative)
$ s,ooo $ 6,SSO $ (I,ISO)
1,000 1,665 665
2,500 621 (1,879)
- 225 22S
11,500 9,361 (2,L39)
22,500 17,494 5,006
22,500 17,494 5,006
(11,000) (8,133) 2,367
32,339 32,339 -
$ ?1,339 $ 24,206 $ 2,867
City of Sebastian, Florida
Schedule of Revenues, Expenditures, and Changes in Fund Balances -Budget and Actual
G.R.E.A.T. Program Special Revenue Fund
For the Year Ended September 30, 2007
REVENUES:
Intergovernmental
Investment earnings
Contributions
Total revenues
Current:
Public safety
Total expendihues
Excess of revenues over expendihues
Fund balances - beginnuig
Fund balances -ending
Actual Variance with
Amounts on Final Budget -
Final a Budgetary Positive
Budget Basis (Negative)
$ 10,000 $ - S (10,000)
- 109 109
4,155 5,121 966
14,155 5,230 (8,925)
14,155 5,121 9,034
14,155 5,121 9,034
- 109 109
783 783 -
$ 783 $ 892 $ 109
71
City of Sebastian, Florida
Schedule of Revenues, Expenditures, and Changes in Fund Balances -Budget and Actual
Stormwater Utility Revenue Bonds 2003 Debt Service Fund
For the Year Ended September 30, 2007
REVENGES:
Investment earnings
To[al revenues
Final
Budget
$ 875 $
875
Actual
Amounts on
a Budgetary
Basis
$ 221
221
EXPENDITURES:
Debt service:
Principal
Interest and fiscal charges
Total expenditures
Deficiency of revenues under expenditures
OTHER FINANCING SOURCES
Transfers in
Total other financing sources
Net changes in fund balances
Fund balances -beginning
Fund balances -ending
Variance with
Final Budget -
Positive
(Negative)
240,000 240,000
198,148 198,148
438,148 433,148
(437,273) (437,052)
437,273 437,273 _
437,273 437,273
- 221
20,320 20,320
$ 20,32D $ 20,541 $
~2
221
221
221
City of Sebastian, Florida
Schedule of Revenues, Expenditures, and Changes in Fund Balances -Budget and Actual
Discretionary Sales Surtax Revenue Bonds 2003 Debt Service Fund
For the Year Ended September 30, 2007
' REVENUES:
Investment earnings
Totat revenues
EXPENDITURES:
Current
Physical environment
Debt service:
Principal
Interest and fiscal charges
Tota] expenditures
Deficiency of revenues under expenditures
OTHER FINANCING SOURCES
Transfers in
Total other Enancing sources
Vet changes in fund balances
Fund balances -beginning
Fund balances -ending
Actual Variance with
Amounts on Final Budget -
Final a Budgetary Positive
Budget Basis (Negative)
S 1,975 $ 7,432 $ 5,457
1,975 7,432 5,457
300 - 300
680,000 680,000 -
354,882 354,881 I
I ,035,182 1,034, 881 301
(1,033,207) (1,027,449) 1,758
1,033,207 1,033,206 (1)
1,033,207 1,033,206 (1)
- 5,757 5,757
205,596 205,596 -
$ 205,596 $ 211,353 $ 5,757
73
City of Sebastian, Florida
Statement of Changes in Assets and Liabilities
Agency Fuud
For the Year Ended September 30, 2007
ASSETS
Cash and cash equivalents
Total assets
LIABILITIES
Performance deposits held in escrow
Total liabilities
Balance Balance
October 1, September 30,
2006 Additions Deletions 2007
$ 165,090 $ 29,615 $ 23,975 $ 170,730
$ 165,090 $ 29,615 $ 23,975 $ 170,730
165,090 29,615 23,975 170,730
$ 165,090 $ 29,615 $ 23,976 S 170,730
74
1
i
1
t
i
i
D
i
1
City of Sebastian, Florida
Capital Assets Used in the Operation of Governmental Funds
Comparative Schedule By Source
September 30, 2007
Governmental Funds capital assets: FY 2006 FY 2007
Land $ 5,301,947 $ 5,696,946
Buildings and structures 9,958,190 10,996,496
Improvement other than buildings 4,614,326 4,970,638
Machinery and equipment 6,436,238 6,820,051
Infrastructure 17,375,199 18,677,191
Capital projects 1,167,207 2,692,704
Total capital assets $ 44,853,107 $ 49,854,026
Investment in Governmental Funds capital assets by sources:
Federal grants $ 1,888,342 $ 2,138,342
State grants 1,278,258 858,210
County grants 715,009 713,359
General fund 10,588,964 11,650,738
Law enforcement trust fund 42,953 42,953
Recreational impact fee 400,532 552,890
Stormwater utility fee 16,255 16,255
Riverfront Redevelopment - 754,056
Cemetery trust fund 181,463 180,963
Donations 2,324,027 2,858,177
Sales taxes 7,779,639 8,249,499
Motor fuel taxes 4,378,033 5,053,455
Revenue bond debt 14,092,425 14,092,425
Capital projects 1,167,207 2,692,704
Total investment in capital assets
$ 44,853,107 $ 49,854,026
75
City of Sebastian, Florida
Capital Assets Used in the Operation of Governmental Funds
Schedule by Function and Activity
September 30, 2007
Function and Activity
Land Buildings Improvements
Other than
Buildings Machinery
and
Equipment
Infrastmchrze Totals
'
General government:
Legislative $ - $ - $ 1,100 $ 2,886 $ - $ 3,986
City manager - - - 2,826 - 2,826
City clerk - - - 143,134 - 143,134
City attorney - - - 599 - 599
Finance - - - 55,623 - 55,623
MIS - 5,841 9,800 78,466 - 94,107
Haman resotuces - 2,050 - 3,704 - 5,764
Building maintenance
- 130,220
4,926
69,775
- 204,921 '
Growth management - 85,555 - 48,317 - 133,872
Non-departmental 3,634,769 6,008,200 26D,202 425,140 212,700 10,541,011
Subtotal
3,634,769 6,231,866
276,028
830,470
212,700 11,185,833 ,
Public safety
Special operations - - - 178,366 - 178,366
Administration 9,560 3,347,151 81,014 273,962 - 3,711,687
School resource - - - 71,469 - 71,469
Road patrol - - - 1,464,867 - 1,464,867 ,
Commtmitypolicing - - - 144,836 - 144,836
Code enforcement - - - 30,444 - 30,444
Professional Stnd. - - - 21,288 - 21,288 '
Investigations - - - 164,711 - 164,711
Support services - - - 73,426 - 73,426
Commanica[ions - - 11,272 211,793 - 223,065
Building department - - - 71,228 - 71,228
Subtotal 9,560 3,347,151 92,286 2,706,390 - 6,151,387
Transportation: t
Engineering 78 146,361 155,293 166,676 271,810 740,218
Central gazage - 111,654 82,419 142,768 - 336,841
Roads and drainage 47,047 102,784 614,253 956,087 10,219,267 11,939,438
Subtotal 47,125 360,799 851,965 1,265,531 10,491,077 13,016,497
Physical Environment '
Stormwater - - - 1,368,132 6,567,262 7,935,394
Cemetery 272,190 47,519 78,354 38,200 22,717 458,980
Subtotal 272,190 47,519 78,354 1,406,332 6,589,979 8,394,374 '
CnlhuelRecreation
Parks and recreation 1,733,302 1,009,161 3,672,005 611,328 1,383,435 8,409,231
Subtotal 1,733,302 1,D09,161 3,672,005 611,328 1,383,435 8,409,231
Total $ 5,696,946 S 10,996,496 $ 4,970,638 $ 6,820,051 $ 18,677,191 $ 47,161,322 '
Construction in progress 2,692,704
Total $ 49,854,026
76 '
'
nction and Activity City of Sebastian, Florida
Capital Assets Used in the Operation of Governmental Funds
Schedule of Changes By Function and Activity
September 30, 2007
Governmental
Funds
Capital Assets Transfers Transfers
October I, 2006 Additions Deletions In Out
overnmental
Funds
Capital ASSets
September 30, 2007
General government:
Legislative $ 3,986 $ - $ - $ - $ - S 3,986
City manager 4,341 - - - 1,515 2,826
City clerk 166,998 21,436 2,428 143,134
City attorney 2,114 - - - 1,515 c99
Finance
MIS 56,063
119,662 1,357
19,351 558
30,683 -
1,000 1,239
15,223 55,623
94,107
Human resources 4,942 2,050 1,238 5,754
Building maintenance 213,388 t 1,678 14,238 20,393 26,300 204,921
Growth management 108,983 32,810 2,648 - 5,273 133,872
'.Van-departmental 9,251,950 1,288,237 46,503 47,327 10,541,01 L
Subtotal 9,932,427 1,355,483 116,066 68,720 54,73( 11,185,833
Public Saftey:
Special operations 33,674 68,072 14,115 9Q735 178,366
Administration 3,720,806 9,995 3,304 - 15,810 3,711,687
School resource 45,383 2,612 - 48,826 25,352 71,469
Road patrol 1,371,890 215,866 1,530 70,515 191,874 1,464,867
Community policing 123,243 - - 52,314 30,721 144,836
Code enforcement 36,583 2,553 8,692 30,444
Professional Stnd. 20,651 = = 15,810 15,173 21,288
Investigations 179,131 25,168 25,625 13,963 164,711
Support services 6Q757 1,407 - 12,433 1,171 73,426
Communications 81,829 142,776 - - 1,540 223,065
' Building department 90,752 13,751 5,773 71,228
Subtotal 5,764,699 461,896 58,325 293,186 310,069 6,155,387
Transportation:
840
12
20
142
740
218
Engineering 748,739 1,219 , , ,
Central gazage 329,298 8,093 550 - - 336,84!
Roads and drainage 11,784,473 238,128 73,113 41,676 51,726 L1,939,438
Subtotal 12,862,510 246,221 74,882 54,516 71,868 13,016,497
Physical Environment:
' Stormwater 6,797,766 1,254,007 123,541 54,657 47,495 7,935,394
Building maintenance
Cemetery 459,480 - 500 - - 458,980
Subtotal 7,257,246 1,254,007 124,041 54,657 47,495 8,394,374
Culture & Recreation:
Parks and recreation 7,869,018 557,477 30,348 35,098 22,014 8,409,231
' Subtotal 7,869,018 557,477 30,348 35,098 22,014 8,409,231
Total 43,685,900 3,879,084 403,662 506,177 506,177 47,161,322
' Construction in progress 1,167,207 3,803,663 2,278,166 - - 2,692,704
.Total $ 44,853,107 $ 7,682,747 _$ 2,681,828 $ 506,177 $ 506,177 $ 49,854,026
' 77
r
QfY OF
THIS PAGE INTENTIONALLY LEFT BLANK
78
t
HOME OF PELICAN ISLAND
-,
Statistical Section
1
1
t
1
This part of the City of Sebastian, Florida's comprehensive arulual financial report
presents detailed information as a context for understanding what the information in the
financial statements, note disclosures, and required supplementary infomation says
about the city's overall financial health.
Contents Pa e s
Financial Trends 80-91
These schedules contain trend information to help the reader understand how
the city's financial performance and well-being have changed over time.
Revenue Capacity 92-97
These schedules contain information to help the reader assess the city's most
significant local revenue source, the property tax, and the municipal sales tax.
Debt Capacity 98-103
These schedules present information to help the reader assess the affordability
of the city's current levels of outstanding debt and the city's ability to issue
additional debC in the future.
Economic and Demographic Information 104-] 06
These schedules offer economic and demographic indicators to help the reader
tmderstand the enviromnent within which the city's financial activities take
place.
Operating Information
These schedules contain service and infrastructure data to help the reader
tmderstand how the information in the city's financial report relates to the
services the city provides and the activities it performs.
Sources: Unless otherwise noted, the information in these schedules is derived from the
comprehensive annual financial reports for the relevant year. The city implemented
GASB Statement 34 in 2001; schedules presenting government-wide information include
information beginning in that year.
79
107-109
City of Sebastian, Florida
Net Assets by Component
Last Seven Fiscal Years
(accrttal basis of accounting)
2007 2006 2005
Governmental Activities
Invested in Capital Assets, Net of Related Debt $ 21,469,456 $ 17,579,683 $ 17,103,399
Restricted 9,419,129 5,068,583 5,395,879
Unrestricted 5,249,998 11,293,877 (2) 9,081,345 (I)
TotalGovenvrrentctlAclivitiesNetAssets $ 36,138,583 $ 33,942,143 $ 31,580,623
Business-Type Activities
Invested in Capital Assets, Net of Related Debt S 8,895,501 $ 8,798,612 $ 7,459,945
Restricted 570,890 560,581 574,L05
Unrestricted 1,303,886 1,896,539 738,519
TotalBusiness-Type Activities Net Assets $ 10,770,277 $ 11,255,732 $ 8,772,569
Prflnary government
Invested in Capital Assets, Net of Related Debt $ 30,364,957 $ 26,378,295 $ 24,563,344
Restricted 9,990,019 5,629,164 5,969,984
Unrestricted 6,553,884 13,190,416 9,819,864
TotaiPrimmyGoverrtmentNetAssets $ 46,908,860 ~$ 45,197,875 $ 40,353,192
(1) The large increases in unrestricted net assets from 2003 to 2004 and from 2004 to 2005 are mainly due to
increase in State revenue sharing. sales and use taxes, and tax revenues.
(2) The lame increase in unrestricted net assets from 2005 to 2006 is mainly due to increase in tax revenues,
franchise fees, and interest earnings.
80
1
1
t
1
1
1
i
1
1
1
2004 2003 2002 2001
$ L6,412,401 $ 16,339,222 $ 14,242,832 $ 12,778,007
4,059,674 3,235,266 3,289,670 2,27Q654
7,171,123 (1) 5,461,224 5,865,388 5,417,630
$ 27,643,198 $ 25,035,712 $ 23,397,890 $ 20,466,291
$ 4,264,961 $ 1,545,867 $ 363,827 $ 15Q,722
506,006 505,435 458,014 640,973
1,712,657 1,471,457 1,120,224 985,863
$ 6,483,624 $ 3,522,759 $ 1,942,065 $ 1,777,558
$ 20,677,362 $ 17,885,089 $ 14,606,659 $ 12,928,729
4,565,680 3,740,701 3,747,684 2,911,627
8,883,780 6,932,681 6,985,612 6,403,493
$ 34,126,822 $ 28,558,471 $ 25,339,955 $ 22,243,849
81
City of Sebastian, Florida
Changes in Net Assets
Last Seven Fiscal Years
(accrual basis ofaccout2tingJ
2007 2006 2005
Program Revenues
Govemmental Activities:
Charges for Services:
General Govenunent
Public Safety
Physical Enviromment
Economic Environment
CulturaURecreation
Operating Grants and Contributions
Capital Grants and Contributions
Total Governmental Activities Program Revenues
Business-Type Activities:
Chazges for Services:
Golf Course
Airport
Building
Operating Grants and Contributions
Capital Grants and Contributions
Total Bxsiness-Type Activities Program Revenues
Total Primary Government Program Revenues
Expenses
Governmental Activities:
79 General Government
Public Safety
Physical Environment
Transportation
Economic Envirorunent
CulturaL'Recreation
Interest and Fiscal Chazges
To tnl Governmental Activities Expenses
Business-Type Activities:
Golf Course
Airport
Building
Total Business-Type Activities Expenses
Total Primary Government Expenses
1
$ 422,897 $ 533,482 $ 370,609
92,853 140,545 1,356,385
891,021 887,819 828,907
85,945 72,472 56,199
192,676 407,898 2,802,511
1,014,481 1,301,438 1,781,954
$ 2,699,873 $ 3,343,654 $ 7,196,565
1
1
$ 1,652,288
344,813
408,875
500,428
$ 2,906,404
$ 5,606,277
$ 3,083,609
5,377,107
1,695,066
2,276,497
605,510
1,237,398
667,950
5 14,943,137
$ 1,580,407
375,768
1,220,823
6,998
1,056,562
$ 4,24Q,558
$ 7,584,212
S 3,129,723
4,191,295
2,193,589
2,173,07 t
98,661
1,208,288
706,303
$ 13,700,930
$ 1,381,817
434,818
(1)
13,582
2,289,986
$ 4,120,203
$ 11,316,768
$ 3,262,276
4,816,614
1,283,889
4,034,900
32,128
1,260,395
740,372
$ 15,430,574
1
L1
.J
$ 1,533,900
1,046,994
905,452
$ 3,486,346
$ 18,429,483
$ 1,558,338
801,967
91(,791
S J,GY /,VYb
$ 16,998,028
S L,464,532
S 19,235 '
(1)
~ 1 OR17(,7
¢ 17 d1d 1dl
Q) The building operation was reclassified from being part of the general fund operation to an enterprise fund
operation at the begimring of fiscal year 2006.
82
L1
LJ
1
1
' zooa zoo3 zoo2 zool
$ 376,327 $ 247,774 $ 172,135 $ 183,502
1,66Q032 824,821 625,924 554,360
860,887 799,637 786,683 -
' -
48,590 -
46,736 24,869
73,013 18,763
35,050
1,144,628 920,829 968,229 902,001
' 1,363,969 640,894 872,490 681,941
$ 6,434,323 $ 3,480,691 $ 3,612,343 $ 2,276,697
1
$ 1,648,308 $ 1,377,246 $ 1,365,027 $ 1,088,104
201,890 (68,461 179,373 193,649
' (1) (1) (I) (1)
67,576 - 51,087 123,673
2,461,212 1,149,437 214,176 299,334
$ 4,368,986 $ 2,696,133 $ 1,809,662 $ 1,704,760
$ 9,803,309 $ 6,176,824 $ 6,322,006 $ 3,980,367
$ 2,414,866 $ 1,620,616 $ 2,010,288 $ 1,676,383
4,602,109 3,391,831 2,946,701 2,626,614
' 1,279,267
3,288,632 1,920,200
2,401,037 608,616
2,268,181 462,116
I,63Q098
86,041 166,024 223,207 241,692
823,974 747,910 881,260 768,802
' 722,007 312,367 168,749 160,964
$ 13,116,786 $ 1Q66Q986 $ 8,996,002 $ 7,466,669
'
$ 1,627,061 $ 1,363,369 $ 1,393,661 $ 1,341,001
360,949 316,941 283,726 313,877
(1) (1) (1) (1)
$ 1,878,000 $ ],679,300 $ 1,677,277 $ 1,664,878
' $ 14,994,786 $ 12,239,286 $ 10,673,279 $ 9,111,437
83
City of Sebastian, Florida
Changes in Net Assets (continued)
Last Seven Fiscal Years
(accratal basis of accounting)
Net (Expense)/Revenue
Govemmental Activities
Business-Type Activities
Tots[ Primary Government tVet Expense
General Revenues and Other Changes in Net Assets
Governmental Activities:
Property Taxes, Levied for Genera] Purposes
Sales and Use Taxes
Franchise Fees
State Shared Revenues
Interest Earnings
Miscellaneous
Transfers
Total Governmental Activities
Business-Type Activities:
Interest Earnings
Miscellaneous
Transfers
Total Business-Type Activities
Total Prinxary Government
Change in Net Assets
Govetnrnental Activities
Business-Type Activities
Total Primary Government Change in Net Assets
2007 2006 2005
$(12,243,264) $(10,357,276) $ (8,234,009)
(579,942) 943,460 2,136,436
$(12,823,206) $ (9,413,816) $ (6,097,573)
$ 5,089,841 $ 4,645,050 $ 4,017,555
4,776,691 4,907,906 4,718,691
1,106,698 1,253,749 886,390
2,083,523 2,242,292 2,138,020
1,147,931 827,224 398,518
192,300 256,780 118,760
42,720 (1,414,205) (2) (106,500)
$ 14,439,704 $ 12,718,796 $ 12,171,434
$ 137,207 $ 125,498 $ 45,709
0 - 300
(42,720) 1,414,205 106,500
$ 94,487 $ 1,539,703 $ 152,509
$ 14,534,191 $ 14,258,499 $ 12,323,943
$ 2,196,440 $ 2,361,520 $ 3,937,425
(485,455) 2,483,163 2,288,945
$ 1,710,985 $ 4,844,683 $ 6,226,370
(2) The large increase in transfers from 2005 to 2006 is mainly due to the one tune transfer of
building reserve to building fund due to the reclassification offund type for the building operation.
84
1
t
1
1
2004 2003 2002 2D01
$ (7,682,462) $ (7,079,294) $ (5,483,659) $ (5,180,962)
2,490,986 1,015,833 132,385 49,882
$ (5,191,476) $ (6,063,461) $ (5,351,274) $ (5,131,080)
$ 3,420,971 $ 2,944,456 $ 2,615,939 $ 2,557,333
4,035,545 3,705,922 2,844,825 3,013,293
770,600 756,194 766,901 753,024
1,721,956 1,523,524 2,068,753 1,336,046
398,158 241,358 118,840 236,307
388,562 79,662 - -
(445,844) (534,000) - -
$ 10,289,948 $ 8,717,116 $ 8,415,258 $ 7,896,003
$ 23,774 $ 21,789 $ 32,122 $ 99,521
261 9,072 - -
445,844 534,000 - -
$ 469,879 $ 564,861 $ 32,122 $ 99,521
$ 10,759,827 $ 9,281,977 $ 8,447,380 $ 7,995,524
$ 2,607,486 $ 1,637,822 $ 2,931,599 $ 2,715,041
2,960,865 1,580,694 164,507 L49,403
$ 5,568,351 $ 3,218,516 $ 3,096,106 $ 2,864,444
85
'
City of Sebastian, Florida
Fund Balances, Govennental Funds
Last Ten Fiscal Years '
(mod~ed accrual basis of accounting
2007 2006 2005 2004 2003 '
Genera] Fund
Reserved $ 947,533 $ 1,815,187 $ 2,848,726 $ 2,693,710 $ 1,402,398
Unreserved 5,443,254 4,663,885 3,254,741 2,421,182 2,479,452 '
Total General Fund $ 6,390,787 $ 6,479,072 $ 6,103,467 $ S,l 14,892 $ 3,881,850
All Other Governmental Funds
Reserved $ 8,299,903 $10,058,183 (() $ 828,819 5 4,208,170 $ 1,596,981
Unreserved, Reported in:
Special Revenue funds 5,321,148 5,381,276 4,735,396 3,355,229 2,2ll,585
Capital Projects funds - - (2) 8,406,953 6,795,37 L 9,993,933 (3)
Total All Odrer Governmental Funds $ 13,621,051 $ L5,439,459 $ 13,971,168 $14,358,770 $ 13,802,499
Total Governmental FuntLr $2QOL1,838 $21,918,531 $ 20,074,635 $19,473,662 $ L7,684,349
(I) The significant change in reserved fund balance from 2005 to 2006 is due to the reclassification ofunreserved
reported in capital projects funds [o reserved.
(2) The significant change in unreserved reported in capital projects funds from 2005 to 2006 is due to the reclassification
ofunreserved reported in capital projects funds [o reserved.
(3) The large increase in unreserved fund balance reported in capital projects funds from 2002 to 2003 is due to the issuance
of City's Infrastructure Sales Surtax Revenue Bonds, Series 2003.
86
1
t
I~
t
t
J
1
2002 2001 2000 1999 1998
$ 232,088 $ 121,256 $ 64,341 $ 43,113 $ 3,303,76!
3,690,659 3,406,083 2,786,252 2,699,955 3,468,381
S 3,922,747 $ 3,527,339 $ 2,850,593 $ 2,743,068 $ 6,772,142
$ 1,503,172 $ 1,306,269 $ 2,021,740 $ 605,270 $ L68,093
' 1,808,288 >48,174 456,461 217,969
2,384,557 2,609,201 1,562,299 4,027,673
$ 5,696,017 $ 4,463,644 $ 4,040,500 $ 4,850,912 $ 168,093
$ 9,618,764 $ 7,990,983 $ 6,891,093 $ 7,593,980 S 6,94Q,235
i
1
i
i
1
1
1
1
1
1
i 87
City of Sebastian, Florida
Changes in Fund Balances, Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accountiny~
Revenues
Property and Other Local Taxes
Franchise Fees
Charges for Services
Licenses and Permits
Fines
Intergovernmental
Impact Fees
Special Assessments
Investment Earnings
Miscellaneous
Total Revenues
Expenditures
Current:
General Government
Public Safety
Physical Environment
Transportation
Economic Environment
Cultural and Recreation
Debt service:
Pruicipal Retirement
## Interest and Fiscal Charges
Capital Outlay
Total Expenditures
Excess of Revenues Over (Under) Expenditures
Other Financing Sources (Uses)
Debt Proceeds
Transfers In
Transfers Out
Total Other Financing Sources (Uses)
Net Change in Fund Balances
Debt Service as a Percentage of Noncapital Expenditures
2007 2006 2005
$10,554,617 $ 10,269,451 $ 9,483,664
1,106,698 1,253,749 886,390
1,27],102 517,605 936,530
186,875 244,370 1,587,675
71,314 77,776 95,699
2,463,628 2,852,293 5,561,695
56,875 337,675 385,775
- 819,286 11,023
1,062,043 827,224 398,518
244,629 294,695 144,057
17,017,781 17,494,124 19,491,026
2,999,652 2,494,863 2,974,736
4,700,447 3,813,908 4,349,639
1,301,719 1,850,642 910,794
1,733,697 1,672,983 3,616,076
80,279 98,661 32,128
975,087 926,846 995,406
1,284,418 1,248,378 L,218,023
643,305 678,682 711,736
5,242,590 1,451,060 3,975,015
18,961,194 14,236,023 18,783,553
(1,943,413) 3,258,101 707,473
5,158,296 3,785,981 3,745,265
(5,115,576) (5,200,186) (3,851,765)
4z,7zo ~1,41a,2o5) (lo6,soo)
$ (1,900,693) $ 1,843,896 $ 600,973
14.1 °/a 15.1 % 13.0%
i
i
i
88 i
1
J
1
2004 2003 2002 2001 2000 1999 1998
$ 8,179,344 $ 7,325,932 $ 6,228,107 $ 6,223,280 $ 6,273,070 $ 5,837,968 $ 5,612,313
770,600 756,194 766,901 753,024 - - -
962,677 921,119 1,123,670 300,046 159,701 33,097 74,485
1,867,920 878,097 578,695 487,618 475,345 448,928 388,936
118,918 119,752 127,027 148,676 140,672 89,697 72,723
3,115,520 1,785,237 2,841,315 1,968,416 2,318,091 1,865,375 1,697,747
557,700 395,850 255,775 - - - -
28,424 22,560 31,756 28,528 128,154 44,964 30,522
398,158 241,358 206,567 417,707 689,395 512,407 290,406
378,268 91,078 126,823 196,311 246,774 650 -
16,377,529 ]2,537,177 12,286,636 10,523,606 10,431,202 8,833,086 8,167,132
2,231,532 1,977,033 2,230,870 1,647,858 1,946,702 1,837,031 2,074,479
3,950,228 3,427,711 2,588,526 2,482,393 2,129,662 2,122,823 1,847,503
1,125,727 1,247,452 508,616 452,116 345,844 412,990 82,699
2,863,397 1,610,761 1,427,992 1,084,401 1,228,234 1,007,426 1,160,404
'
86,041 166,024 327,911 273,927 617 4,830 8,492
747,131 629,835 732,729 612,038 555,584 488,499 348,546
1
1
t
1
t
985,974 361,024 344,553 222,954 212,860 225,243 182,434
887,564 158,043 174,864 152,093 151,536 160,940 29,522
9,021,558 3,859,709 2,322,794 3,402,365 4,713,604 1,91>,620 2,64Q,389
21,899,152 13,437,592 10,658,855 10,330,145 11,284,643 8,175,402 8,374,468
(5,521,623) (900,415) 1,627,781 193,461 (853,441) 657,684 (207,336)
7,756,780 9,500,000 - 900,000 - - 3,261,030
2,745,754 2,992,908 2,009,173 2,130,744 2,134,510 1,861,364 258
(3,191,598) (3,526,908) (2,009,173) (2,130,744) (2,134,510) (1,861,364) (258)
7,310,936 8,966,000 - 900,000 - - 3,261,030
$ 1,789,313 $ 8,065,585 $ 1,627,781 $ 1,093,461 $ (853,441) $ 657,684 $ 3,053,694
14.5% 5.4% 6.2% 5.4% 55°/a 6.2% 3.7%
' 89
City of Sebastian, Florida
Program Revenues by Function/Program
Last Seven Fiscal Years
(accrual basis ofaccountin~
2007 2006 2005 2004
Function/Program
Governmental Activities:
General Government
Pubic Safety
Physical Environment
Transportation
Economic Environment
Culmral/Recreation
Total Governmental Activities
Business-type activities:
Golf Course
Airport
Building
Total Business-Type Activities
Total Primary Government
$ 450,267 $ 579,591 $ 587,527 $ 392,471
249,756 306,702 1,537,557 1,850,7 t0
891,021 890,092 898,821 914,318
721,103 900,365 3,392,883 1,670,534
- 30,059 - -
387,726 636,845 779,777 606,290
$ 2,699,873 $ 3,343,654 $ 7,196,565 $ 5,434,323
$ 1,652,288 $ 1,587,405 $ 1,395,399 $ 1,715,884
845,241 1,432,330 2,724,804 2,653,102
408,875 1,220,823 (1) (1)
$ 2,906,404 $ 4,240,558 $ 4,12Q203 $ 4,368,986
$ 5,606,277 $ 7,584,212 $ 11,316,768 5 9,803,309
(1) The building operation was reclassified from being part of the general fund operation to an enterprise
fund operation at the beginning of fiscal year 2006.
90
1
I1
' 2003 2002 2001
'
$ 1,095,902 $ 172,135 $ 226,786
929,952 785,373 633,230
1,136,507 785,683 779,837
' 1,580,076 3,038,913 2,285,809
- 24,869 18,753
663,459 566,959 168,335
$ 5,405,896 $ 5,373,932 $ 4,112,750
S 1,377,245 $ 1,365,517 $ 1,088,104
1,317,888 444,145 616,656
' (1) (1) (1)
$ 2,695,133 $ ],809,662 $ 1,704,760
' $ 8,101,029 $ 7,183,594 $ 5,817,510
1
1
1
' 91
City of Sebastian, Florida
Tax Revenues by Source, Governmental Funds
Last Ten Fiscal Yeazs
(modified accrual basis of accounting)
Fiscal Year Property Taxes Public Utility Sales Tax
2007 (1) $ 5,089,841 $ 2,216,381 $ 2,560,310 $
2006(2) 4,645,050 2,183,164 2,724,742
2005 4,017,555 2,005,124 2,713,567
2004 3,420,971 1,854,632 2,180,913
2003 2,944,456 1,780,717 1,925,205
2002(3) 2,717,564 983,236 1,861,589
2001 2,608,989 1,151,685 1,861,608
2000(4) 2,323,566 1,044,595 1,704,749
1999(5) 2,734,068 413,045 1,553,672
1998 2,810,622 370,170 1,412,207
Motor Fuel Total
688,085 $ 10,554,617
716,495 10,269,451
747,418 9,483,664
722,828 8,179,344
675,554 7,325,932
665,718 6,228,107
600,998 6,223,280
549,800 5,622,710
484,054 5,184,839
440,843 5,033,842
(I) Fiscal Yeaz 2007 property tax revenue reflects a change in the property tax millage rate from 3.9325 to 3.0519.
(2) Fiscal Year 2006 property tax revenue reflects a change in the property tax millage rate from 4.5904 to 3.9325.
(3) Fiscal Year 2002 property tax revenue reflects a change in the property tax millage rate from 5.0000 to 4.5904.
(4) Fiscal Year 2000 property tax revenue reflects a change in the property tax millage rate from 6.5000 to 5.0000.
(5) Fiscal Yeaz 1999 property tax revenue reflects a change in the property tax millage rate from 6.9000 to 6.5000.
Millage Rate represents the dollar of tax per one thousand dollars of taxable valuation.
92
1
1
1
1
1
City of Sebastian, Florida
Property Tax Rates
Direct and Overlapping Governments
Last Ten Fiscal Years
Cit y of Sebastian Indian River County School Boazd
Debt Total Total Debt Total
Fiscal Operating Service City Countyll~ Operating Service School
Yeaz Millage Millage Millage Millage Millage Millage Millage OtherlZ~
1998 6.9000 - 6.9000 8.30490 9.00300 1.13700 10.14000 2.49690
1999 6.5000 -- 6.5000 8.33160 8.61400 1.00000 9.61400 1'1
2000 5.0000 -- 5.0000 8.24360 8.61400 1.00000 9.61400 1.52091
2001 5.0000 -- 5.0000 8.24860 8.67700 0.88000 9.55700 1.62899
2002 4.5904 -- 4.5904 8.08410 8.40200 0.68000 9.08200 1.14845
2003 4.5904 -- 4.5904 8.03020 8.10200 0.63000 8.73200 1.43875
2004 4.5904 -- 4.5904 7.93960 8.17900 0.53100 8.71000 1.69278
2005 4.5904 -- 4.5904 7.35050 8.01900 0.48000 8.49900 1.43029
2006 3.9325 -- 3.9325 5.69040 7.88000 0.36000 8.24000 1.60850
2007 3.0519 -- 3.0519 5.36610 7.16300 0.28000 7.44300 1.47940
(1) Millage includes General Fund, M.S.T.Us, Emergency Services District and Land Bonds.
(2) All Special Taxing Districts.
(3) Information not available.
Source: Indian River County Property Appraiser's Office
93
City of Sebastian, Florida
Assessed Valuation and Estimated True Values of Taxable Property (1)
Last Ten Fiscal Years
Real Property Personal Pro perty
Fiscal Assessed Estimated Assessed Estimated
Year Value Actual Value Value Actual Value
1998 587,811,960 734,764,950 31,210,876 31,210,876
1999 626,274,970 782,843,713 46,027,721 46,027,721
2000 656,619,860 820,774,825 42,216,162 41,533,985
2001 754,577,150 943,221,438 45,195,579 45,195,579
2002 829,224,615 1,036,530,769 45,355,170 45,355,170
2003 946,293,950 1,182,867,438 48,613,628 48,613,628
2004 1,157,275,164 1,446,593,955 51,330,277 51,330,277
2005 1,526,923,406 1,908,654,258 51,827,624 51,827,624
2006 2,124,615,672 2,655,769,590 55,913,696 55,913,696
2007 2,054,408,055 2,568,010,069 64,899,942 64,899,942
Source: Indian River County Property Appraiser
(1) Total assessed value based on approximately 80 percent of estimated actual value.
Exemptions
Real
Property
177,515,747
187,751,454
190,327,263
198,445,669
205,977,066
217,554,663
228,262,825
271,466,364
322,318,753
334,302,515
94
1
Total To[al
Assessed Estunated
Value Actual Value
' 619,022,836 765,975,826
672, 3 02 , 691 828, 8 71, 434
698,836,022 862,308,810
' 799,772,729 988,417,017
874,579, 785 1,081, 885,939
' 994,907,578
1,208,605,441 1,231,481,066
l ,497,924,232
1, 578,751, 030 1, 960,481, 882
2,180,529,368 2,711,683,286
' 2,119,307,997 2,632,910,011
' 95
City of Sebastian, Florida
Principal Taxpayers
Year 2007 and Yeaz 1998 '
'
2007 1998 ,
Real Percentage Real Percentage
Property of Total Property of Total
Assessed
Assessed
Assessed
Assessed '
Taxpayer Valuation Rank Valuation Valuation Rank Valuation
Fl
id
P
& Li
h
il ,
or
a
ower
g
t (Ut
ity /Electric) $ 19,621,470 1 1.27% $ 6,448,890 3 1.02%
Wal-Mart Stores Inc. (Retail) 15,159,607 2 0.98% 7,843,080 2 1.24%
KB Homes Treasure Coast LLC (Construction) 13,128,500 3 0.85% -- -- ,
Chance Holdings LLC (Development) 11,151,290 4 0.72% -- __
Sebastian Crossings LLC (ConsWction) 8,797,890 5 0.57% -- --
Adams Homes of Northwest FL (Construction)
8,724,593 6
0.56%
--
__ '
IPF /Sebastian LLC (Retail) 8,708,020 7 0.56% -- --
512 Commerce Center LLC 8,184,770 8 0.53% -- __
Pazk Place Community LLC (Rent /Retail) 7,814,264 9 0.50% 2,737,650 5 0.43%
Bellsouth Communications (Communication) 7,790,960 l0 0.50% 7,930,440 1 1.26%
Lynch, Robert N. (Bishop) -- -- 3,665,790 4 0.58%
Grace's Landing Ltd
--
--
2,111,580
6
0.34% ,
Falcon Cable Media -- -- 1,618,367 7 0.26%
Winn Dixie Stores Inc. -- -- 1,586,073 8 0.25% '
Sebastian Center Ltd -- -- 1,316,420 9 0.21%
RinghaverEquipment -- -- 780,155 10 0.12%
$ 109,081,364 7.04% $ 36,038,445 5.71% '
Total Assessed Valuation $1,547,382,611 $630,218,290
t
Source: Indian River County Property Appraiser's Office '
96 '
' City of Sebastian, Florida
Property Tax Levies And Collections
Last Ten Fiscal Years
Percent of Percent of
Total Current Current Tax Delinquent Total Total Tax
Tax Tax Collections Tax Tax Collections
' Year Levy Collections To Tax Levy Collections (1) Collections To Tax Levy
' 2007 $ 4,747,938 $ 4,537,100 96 % $ 9,429 $ 4,546,529 96
2006 4,426,281 4,300,217 97 39 4,30Q,256 97
' 2005 3,888,488 3,723,912 96 1,712 3,725,624 96
2004 3,216,940 3,130,521 97 34,247 3,164,768 98
2003 2
862
650 2
725
515 95 26
908 2
752
423 96
,
, ,
, , ,
,
' 2002 2,635,277 2,489,854 94 36,421 2,526,275 96
2001 2,542,544 2,455,930 97 51,690 2,507,620 99
2000 2,422,756 2,283,898 94 35,050 2,318,948 96
' 1999 2,869,796 2,726,857 95 2,912 2,729,769 95
1998 2,909,597 2,679,819 92 130,803 2,810,622 97
(1) Does not include penalties and interest on delinquent taxes.
' Source: Indian River County Property Appraiser and Tax Collector
' 97
City of Sebastian, Florida
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
Govemmental Activities
Business-type
Water Line Roadway
Assessment Improvement
Year Bonds Notes
2007 $ - $1,566,839
2006 - i'9Q,544
2005 - 2.OD4,718
2004 - 2;209,745
2003 77,615 2,406,028
2002 134,299 2,593,939
2001 187,901 2,773,847
2000 238,589 2,946,113
1999 286,521 3,111,041
1998 322,044 3,268,890 (2)
lntrastrucwre Heavy Stormwater Golf Course Total
Sales Tax Equipment Utility Revenue Revenue Primary Per
Bonds Lease Bonds Bonds Government Capita
$ 9,145,000 $ 147,538 $4,815,000 $ 870,000 516,544,377 738
9,825,000 288,251 5,055,000 1,140,000 18,098,795 835
10,490,000 422,455 5,290,000 1,395,000 19,179,718 957
I I, L40,000 550,452 5,525,000 1,885,000 20,759,745 L,072
9,500,000 672,526 - 2,1 15,000 14,098,643 765
- 788,957 - 2,335,000 5,063,233 295
- - - 2,435,000 (I) 5,396,748 334
- - - L,500,000 4,684,702 290
- - - 1,610,000 5,007,562 319
- - - 1,715,000 5,]05,934 35L
(1) Golf Course Revenue Bonds, Series 1996 was refunded in 2001.
(2)The City issued a $3,268,890 promissory note [o finance costs of roadway improvements in 1998.
98
Assessed Valuation
Assessed taxable real property value
Add back: exempt real property
Total assessed value of real property
City of Sebastian, Florida
Computation of Lega] Debt Margin
September 30, 2007
Legal debt mazgin:
Debt limitation - 5 percent of total assessed real property value (1)
Debt applicable to limitation
Total bonded debt
Less: revenue bonds
Total applicable to limitation
' Legal debt margin
i
$ 101,006,026
(1) City adopted fmancial policies state the City will limit its total outstanding general obligation debt to
five percent of the assessed valuation of real property.
City of Sebastian, Florida
Direct and Overlapping Governmental Activities Debt
General Obligation Bonds
September 30, 2007
The City of Sebastian has no overlapping general obligation bonded debt.
S 1,72Q,105,540
334,302,515
5 2,054,408,055
$ 102,720,403
$ 15,674,377
(13,960,000)
1,714,377
' 99
City of Sebastian, Florida
Ratios of General Banded Debt Outstanding and Legal Debt iVlargin
Last Nine Fiscal Year
Debt Limit (1)
Total net debt applicable to limit
Legal debt mazgin
To[al net debt applicable to the limit
as a percentage of debt limit
2007 2006 2005 2004
$ 102,720,403 $ 76,346,170 $ 76,346,170 $ 57,863,758
1,714,377 2,078,796 2,427,174 2,760,196
$ 101,006,026 5 74,267 374 $ 73,918,996 $ 55,103,562
L67% 2.72% 3.18% 4.77%
(1) Under the City's adopted financial policies, the City's outstanding general obligation debt should not exceed 5% of
the assessed valuation of real property. The percentage was dropped from l0% to 5% in fiscal year 2003.
100
t
1
1
2003 2002 2001 2000 1999
$ 47,314,698 $ 82,922,462 $ 75,457,715 $ 65,661,986 $ 62,627,497
3,078,556 3,382,896 3,673,847 2,946,113 3,111,041
$ 44,236,142 $ 79,539,566 $ 71,783,868 $ 62,715,873 $ 59,516,456
651% 4.08% 4.87%
101
4,49°/a 4.97%
City of Sebastian, Florida
Pledged-Revenue Coverage
Last Ten Fisca] Years
Recreational Facilities Improvement and Refundin G Revenue Bonds Series 2001
Less: Net
Fiscal Gross Operating Available Dcbt Scrvice
Year Revenuest~~ Expenses (z) Revenue Principal Interest Total Coverage
1998 $1,351,368 $ 874,334 $ 477,034 $ 100,000 $ 107,850 $ 207,850 t'~ 2.30 ta>
1999 1,414,976 891,914 523,062 105,000 102,650 207,650 ~'~ 2.52 t''
2000 1,450,487 947,145 503,342 110,000 96,980 206,980 t'1 2.43 (a>
2001 1,165,091 Cs> 1,043,741 Cs> 121,350 -- -- -- lel _ rn
2002 1,386,424 1,020,640 365,784 100,000 104,481 204,481 (e> 1.79 t'~
2003 1,400,154 968,052 432,102 220,000 89,890 309,890 (e> 1.39 t'~
2004 1,497,053 1,108,770 388,283 230,000 80,890 310,fi90 cel 1.25 "1
2005 1,395,436 1,023,002 372,434 240,000 71,490 311,490 «1 1.20 t't
2006 1,628,015 1,165,411 462,604 250,000 61,690 311,690 tel 1.48 t'~
2007 1,701,171 1,218,382 482,789 255,000 51,590 306,590 1.57
Note: Detail regarding the City's outstanding debt can be found in the notes to the financial statements.
(1) Total revenues including charges for services, rents, and interest.
(2) Total direct operating expenses excludes depreciation, amortization, annual Airport lease payment,
and one time hurricane repaire and upgrade.
(3) Golf Course Bond, Series 1985 refunded in 1992 with Series 1992.
(4) Required coverage is 1.0.
(5) Golf Course closed for four months for renovations.
Golf Course Bond, Series 1992 refunded with Recreational Facilities Improvement and Refunding Revenue
(6) Bonds, Series 2001.
(7) Required coverage is 1.25.
(8) Total revenues consist of stormwa[er utility fees and interest.
(9) Required coverage is 1.35.
LJ
1
102
1
t
Stormwater Utility Revenue Bonds, Series 2003
'
Gross Debt Service
Revenueste~ Principal Interest Total Coveraget9i
'
$ 779,724 $ 105,000 S 104,386 $ 209,386 3.72
' 792,886 235,000 206,673 441,673 1.80
908,576 235,000 201,973 436,973 2.08
932,183 240,000 197,273 437,273 2.13
t
1
1
LJ
103
City of Sebastian, Florida
Demographic and Economic Statistics
Last Ten Years
Total Per Capita
Personal Personal
Year Population Income (1) Income (1)
2007 22,426 (5) (5)
2006 21,666 (5) (5)
2005 20,048 (5) (5)
2004 19,365 $ 5,071,395,000 $ 40,677
2003 18,425 4,831,037,000 40,162
2002 17,167 4,680,414,000 39,683
2001 16,667 4,552,238,000 39,470
2000 16,181 4,207,683,000 37,110
1999 15,707 3,983,019,000 35,788
1998 15,115 3,770,896,000 34,608
Nledian
Household Median
Income (1) Awe (2)
(5) (5)
(5) (~)
(5) (5)
(5) (5)
$ 40,291 (5)
39,615 (5)
39,359 (5)
40,063 49.2
37,947 (5)
37,398 (S)
Sources:
(1) Florida Research & Economic Database. Information available for Indian River County only.
(2) G.S. Census Bureau
(3) Indian River County School Board
(4) Indian River County Property Appraiser
(5) Infotmation not available
(6) The school population appears to have declined dueto rezoning. The City of Sebastian has only one (1)
middle school, and the overflow students have been rezoned to the county.
104
1
1
1
1
t
1
1
1
1
1
1
Educational
Attainment:
Bachelor's Degree School Unemployment Tota] Assessed
or higher (2) Enrollment (3) Rate (L) Property Vahie (4)
(5) % 5,117 (6) 6 % $ 2,119,307,997
(5) 5,604 4.1 2,180,529,368
(5) 5,258 4.0 1,578,751,030
(5) 4,917 7.6 1,208,605,441
(5) 4,340 7.5 994,907,578
(5) 4,309 7.8 874,579,785
(5) 1,371 7.4 799,772,729
23.1 1,342 6.5 698,836,022
(5) 1,383 7.5 672,302,691
(5) 1,410 7.9 6!9,022,836
105
City of Sebastian, Florida
Principal Employers
Yeaz 2007 and Eight Yeazs Ago
2007
Percentage
Number of of Total County
Employer Employees Employment
Indian River Memorial Hospital
Publix Supermarket
The New Piper Aircraft
Sebastian River Medical Center
Hale Indian River Groves
Wal-Mart
John's Island
Indian River Estates
Sun Ag,Inc.
Disney's Vero Beach Resort
Total
1,300
1,104
1,045
530
450
449
446
442
350
315
5,131
2.24
1.90
1.80
0.91
0.78
0.77
0.77
0.76
0.60
0.54
Total County Employees
58,001
8.85
1999 (1)
Percentage
Number of of Total County
Employer Employees Employment
The New Piper Aircraft
Publix Supermarket
W al-Mart
Sun Ag.Inc.
Winn Dixie Supermarkets
Hale Indian River Groves
Gracewood Fruit Packing
Dodgertown Complex
John's Island
Graves Brothers
Total
1249
792
774
550
520
505
500
438
415
400
2.87
1.82
1.78
1.26
1.19
1.16
1.15
1.00
0.95
0.92
Total County Employees
6,143
43,592
14.09
(1) Principal employers for nine years ago (1998) is not available. The information is available from 1999.
Source: Indian River County Chamber oFCommerce
* Principal employers information available for Indian River County only.
1
CJ
1
1
106
' City of Sebastian, Florida
Full-Time Equivalent City Government Employees by FunctioniProgram
Last Ten Fiscal Years
'
2007 2006 2005 2004 2003 2002 2001 2000 1999 1998
Function/oroeram
' General Government:
City Council 2.5 2.5 2.5 2.5 2S 2.5 25 2.5 2.5 2.5
1 City Manager
City Clerk 2.0
4.0 2.0
4.5 5.0
4.0 4.0
4.0 4.0
4.0 4.0
5.0 4.0
5.0 3.0
5.0 3.0
5.0 3.0
5.0
City Attorney 2.0 2.0 2.0 1.0 1.0 1.0 1.0 1.0 0.0 0.0
Finance 5.0 6.0 5.0 5.0 5.0 6.0 6.0 5.0 5.0 5.0
Mgmt Information Svcs 3.0 3.0 2.0 2.0 2.0 0.0 0.0 0.0 0.0 0.0
' Human Resources 3.0 3.0 3.0 3.0 3.0 3.0 3.0 3.0 2.0 2.0
Building Maintenance 2.0 2.0 2.0 0.0 4.0 4.0 4.0 4.0 4.0 4.0
Growth Management 5.0 4.0 4.0 4.0 4.0 4.0 4.0 4.0 6.0 0.0
' Public Safety:
Police Department 57.0 58.0 (z) 59.0 56.5 545 53.0 52.5 50.0 47.0 45.0
Building Department t LD 11.0 9.0 8.0 7.0 7.0 6.0 6.0 6.0 0.0
Code Enforcement 3.0 3.0 (z) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
' Transportation:
Roads & Drainage l 1.5 12.5 12.5 14.5 l LS (l) 23.5 26.5 27.5 24.0 22.0
Central Garage 3.5 3.5 3.0 3.0 3.0 3.0 3.0 3.0 3.5 3.5
Airport 3.0 3.5 3.5 2.5 2.5 1.5 I.0 0.5 0.5 0.5
Physical Environment:
Engineering 9.0 8.0 8.0 8.0 7.5 8.0 6.5 6.5 6.0 6.0
StormwaterUtility 13.0 13.0 13.0 12.0 12.0 (p 1.0 0.0 0.0 0.0 0.0
Cultural/Recreation:
Pazks & Recreation 23.5 24S 23.5 17.5 16.5 14.0 14.0 10.0 109 10.0
Cemetery 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0
' Golf Course 12.5 12.5 12.5 13.5 135 14.5 12.5 12.5 l L5 115
Totals: 177.5 180.5 175.5 163.0 159.5 157.D 153.5 145.5 138.0 122.0
' (1) Eleven employees were moved from roads & drainage to storm water starting fiscal year 2003.
(2) Code enforcement division was transferr ed out from the Police Departme nt starting fiscal year 20 06.
Source: City of Sebastian, Florida 1998-20 08 Annu al Budgets
' Method: Using 1.0 for each full-time employee, and 0.50 for each part-time and seasonal employee
' 107
City of Sebastian, Florida
Operating Indicators by Function/Program
Last Nine Fiscal Years
Function/program 2007 2006 2005 2004 2003 2002 2001 2000 1999 '
General Government
Number of Annexation Approved 1 1 1 6 3 0 I
Acres of Annexed Property 3.87 3.3 25.55 484 80 0 80
Purchase Orders Issued 284 293 369 408 372 357 411
Public Safety
Police Department
Physical Arrest 697 744 786 653 557 5 LS 627
Traffic Violations 7,221 6,291 5,457 5,431 1,939 2,528 2,?81
Parking Violations 289 880 303 3,801 632 207 198
Building Department
Construction Permits Issued 116 506 774 577 544 363 315
Estiroated Value of Construction (in millions) $ 32.3 $ 88.3 $114.7 $1123 $ 82.7 $ 38.9 $ 29.0
Transportation
Road Maintenance (man hours)* 888 512 100 878 850 827 (I)
Asphalt for road maintenance (tons) 210 127 125 88 79 75 (I )
Concrete for road maintenance (yards) (2) 0 300 0 283 277 275 (1)
Physical Environment
Cemetery
Cemetery Intemmen[s 69 76 79 86 81 73 "18
Grave Deeds Sold 49 56 56 69 45 54 67
Stormwater
Mile of Swales Maintained 280 280 280 280 280 280 280
Mile of Ditches Maintained 50 50 50 50 50 50 50
Road Crossing Maintained 30 30 30 30 30 30 30
Catch Basins/Culverts 275 275 275 275 275 250 248
Recreation
l 0
6 0
406 397 '
738 481
3,562
2,413 '
305 53
317 210
Q) $ 9.8
(1)
(L) (1)
(1)
(1) (1)
85
77 52
34 ,
(1)
(1)
(~)
(1) (I)
(1)
0)
(1)
Recreation Center attendance 14,177 8,004 5,504 7,498 (I) (l) (l) (1) (1)
Number of Discount Cards 1,004 2,690 1,000 993 855 890 746 791 (1)
Number of Golf Course Memberships 108 119 85 l l6 l37 169 190 2l2 (1)
Average daily golf revenue $4,661 $4,209 $3,854 $4,207 $3,693 $3,588 $2,844 $8,348 $4,996
(1) Information not available
(2) All road maintenance utilized asphalt, no concrete curbing was installed.
Sources: City of Sebastian Police Departrnent, Growth Management, Public Works, Engineering
Department, Golf Course, and Building Department.
108
1
i
i
1
r
i
City of Sebastian, Florida
Capital Asset Statistics by Function/Program
Last Nine Fiscal Years
Function/program 2007 2000 2005 2004 2003 2002 2001 2000 1999
General Government
Square Footage Occupied 21,500 21,500 21,500 S,Sl6 5,516 5,516 5,516 S,Sl6 5,516
Departmental Vehicles 3 3 5 2 2 2 3 3 3
Public Safety
Police Stations 1 l l L 1 1 1 l 1
Squaze Footage of Police Department 25,600 25,600 25,600 8,700 8,700 8,700 8,700 8,700 8,700
Square Footage of Building Department 2,500 2,500 2,500 1,716 1,716 1,716 1,716 1,716 1,716
Police Vehicles 57 53 52 47 42 40 33 32 24
Buildiug Inspector Vehicles 5 6 5 4 4 5 4 3 2
Transportation
Streets (miles) 156 156 156 156 149.6 140.0 140.0 140.0 140.0
Number of5treetlights 1,309(1) 3,808 3,555 3,543 3,543 3,531 3,31 3,319 1,156
Airport 1 1 1 1 1 1 I 1 1
Public Service Vehicles 21 l9 14 24 18 22 19 16 l6
Physical Environment
Public Service Vehicles 10 12 l3 6 7 4 4 4 4
Recreation
Number of Parks 14 l4 l2 12 12 10 l0 l0 9
Recreation Centers 2 2 2 2 2 2 2 2 2
Pazk Acreage 229.37 229.37 223.37 223.37 223.37 207.85 196.47 196-47 194.38
Recreation Center Square Footage 4,859 4,859 4,859 4,859 4,859 4,859 4,859 4,859 4,859
Pazk Maintenance Vehicles 12 11 10 8 6 6 5 5 5
Golf Course t I 1 l I 1 l 1 1
Sources: City of Sebastian Finance Department and Growth Management Department
'Data from 1998 not available
(1) This number represents actual unmetered street lights in the Ciry. (Source: Florida Power & Light)
109
CITY OF
,~~;~;
---~
,,
-_ . _~~,
_ _ v ~.
HOME OF PELICAN ISLAND
THIS PAGE INTENTIONALLY LEFT BLANK
~~o
1
i
~rj
C'
i
1
1
1 SINGLE AUDIT SECTION
The Single Audit Section contains various independent auditor's
reports and schedules as required by the Florida Single Audit Act,
Chapter 215.97, Florida Statutes for state and local governments that
receive state assistance.
1
1
t
1
1
Independent Auditor's Report on Internal Control Over Financial
Reporting and on Compliance and Other Matters Based on an
Audit of Financial Statements Performed in Accordance with
Governmental Auditing Standards
Independent Auditor's Report on Compliance and Internal Control
over Compliance to Each Major State Project
Schedule of Findings and Questioned Costs -State Projects
Schedule of Expenditures of State Financial Assistance
' 111
CITY OF
1
~~,~. -~
__~' ~
q `/
HOME OF PELICAN !BLAND
0
THIS PAGE INTENTIONALLY LEFT BLANK
112
' Harris, Cotherman,
' Jones, Price 6z Associates
Certified Public Accoumm~rs -Chartered
5070 North Highway AIA, Suite 250
' Vero Beach, FL 32963
Tel 772.234.8484
Fax 772.234.8488
' Independent Auditors' Report on Internal Control Over Financial Reporting
and on Compliance and Other Matters Based on an Audit of Financial
Statements Performed in Accordance with GovernmentAuditing Standards
Honorable Mayor and Members of City Council
City of Sebastian
' Sebastian, Florida
We have audited the financial statements of the governmental activities, the business-type activities, each
' major fund, and the aggregate remaining fund information of the City of Sebastian, Florida (the City) as
of and for the year ended September 30, 2007, which collectively comprise the City's basic financial
statements, and have issued our report thereon dated February 21, 2008. We conducted our audit in
accordance with auditing standards generally accepted in the United States of America and the standards
' applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller
General of the United States.
' Internal Control Over Financial Reporting
In planning and performing our audit, we considered the City's internal control over financial reporting as
' a basis for designing our auditing procedures for the purpose of expressing our opinions on the financial
statements, but not for the purpose of expressing an opinion on the effectiveness of the City's internal
control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the
' City's internal control over financial reporting.
A control deficiency exists when the design or operation of a control does not allow management or
' employees, in the normal course of performing their assigned functions, to prevent or detect
misstatements on a timely basis. A significant deficiency is a control deficiency, or combination of
control deficiencies, that adversely affects the City's ability to initiate, authorize, record, process, or
report financial data reliably in accordance with generally accepted accounting principles such that there
is more than a remote likelihood that a misstatement of the City's financial statements that is more than
inconsequential will not be prevented or detected by the City's internal control.
' A material weakness is a significant deficiency, or combination of significant deficiencies, that results in
more than a remote likelihood that a material misstatement of the financial statements will not be
prevented or detected by the City's internal control.
' Our consideration of the internal control over financial reporting was for the limited purpose described in
the first paragraph of this section and would not necessarily identify all deficiencies in internal control
' that might be significant detciencies or material weaknesses. We did not identify any deficiencies in
internal control over financial reporting that we consider to be material weaknesses, as defined above.
' "Providing Vision and Direction to our Clients"
Member AICPA Member AICPA Division For CPA Firms Member FICPA
Private Compassies Practice Section
' 113
Harris, Cotherman, '
Jones, Price 6i Associates
Ce¢iFied Public Accoun[an[s -Chartered
1
Honorable Mayor and Members of City Council '
City of Sebastian
Page two
1
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City's financial statements are free of '
material misstatement, we performed tests of its compliance with certain provisions of laws, regulations,
contracts and grant agreements, noncompliance with which could have a direct and material effect on the '
determination of financial statement amounts. However, providing am opinion on compliance with those
provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The
results of our tests disclosed no instances of noncompliance or other matters that are required to be '
reported under Government Auditing Standards.
We noted certain matters that we reported to management of the City of Sebastian, Florida in a separate '
letter, Independent Auditors' Management Letter Comments, dated February 21, 2008.
This report is intended solely for the information and use of the City of Sebastian, Florida and '
management, state awarding agencies and pass-through entities, and the State of Florida Office of the
Auditor General and is not intended to be and should not be used by anyone other than these specified
parties. 1 '
~~+'3'r CdV~tttritAM,Q/IW~i~Rte/7Q+k6tl1R `~L1
C.¢t l~ub~ta Q~rwxfYsatis - Chan~e~d '
Harris, Cotherman, Jones, Price & Associates, Chartered '
Certified Public Accountants
February 21, 2008
1
114 '
1
® Harris, Cotherman,
' Jones, Price & Associates
Certified Public Amouneants -Chartered
5070 North Highway AIA, Suite 250
' Vero Beach, FL 32963
Tel 772.234.8484
Fax 772.234.8488
J
Independent Auditors' Report on Compliance with Requirements Applicable
to Each Major State Project and on Internal Control Over Compliance
io Accordance with the Department of Financial Services State
Projects Compliance Supplement
Honorable Mayor and Members of City Council
City of Sebastian
Sebastian, Florida
' Compliance
1
1
We have audited the compliance of the City of Sebastian, Florida with the types of compliance
requirements described in the Department of Financial Services State Projects Compliance Supplement,
that aze applicable to each of its major state projects for the yeaz ended September 30, 2007. The City of
Sebastian, Florida's major state projects are identified in the summary of auditors' results section of the
accompanying schedule of findings and questioned costs. Compliance with the requirements of laws,
regulations, contracts, and grants applicable to each of its major state projects is the responsibility of the
City of Sebastian, Florida's management. Our responsibility is to express an opinion on the City of
Sebastian, Florida's compliance based on our audit.
We conducted our audit of compliance in accordance with auditing standards generally accepted in the
United States of America; the standards applicable to financial audits contained in Government Auditing
Standards, issued by the Comptroller General of the United States, Chapter 69I-5, Schedule of
Expenditures of State Financial Assistance, Rules of the Department of Financial Services, and Chapter
10.550, Rules of the Auditor General. These standards, Chapter 69I-5 and Chapter 10.550, Rules of the
Auditor General, require that we plan and perform the audit to obtain reasonable assurance about whether
non-compliance with the types of compliance requirements refered to above that could have a direct and
material effect on a major state project occuned. 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
refered to above that are applicable to each of its major state projects for the year ended September 30,
zoo7.
Member AICPA
1
"Providing Vision and Diteclion to our Clients"
Member AICPA Division For CPA Frms
Private Companies Pactice Section
115
Member rCPA
Harris, Cotherman,
Jones, Price 6z Associates
Cer[iFied Publi< Accouncancs -Chartered
Honorable Mayor and Members of City Council
City of Sebastian
Page two
Internal Control Over Compliance
The management of the City of Sebastian, Florida is responsible for establishing and maintaining
effective internal control over compliance with the requirements of laws, regulations, contracts, and
grants applicable to state projects. In planning and performing our audit, we considered the City of
Sebastian, Florida's internal control over compliance with requirements that could have a direct and
material effect on a major state project in order to determine our auditing procedures for the purpose of
expressing our opinion on compliance but not for the purpose of expressing an opinion on the
effectiveness of internal conhol over compliance. Accordingly, we do not express our opinion on the
effectiveness of the City of Sebastian's internal control over compliance.
A control deficiency in an entity's internal control over compliance exists when the design or operation of
a control does not allow management or employees, in the normal course of performing their assigned
functions, to prevent or detect noncompliance with a type of compliance requirement of a state project on
a timely basis. A significant deficiency is a control deficiency, or combination of control deficiencies,
that adversely affects the entity's ability to administer a state project such that there is more than a remote
likelihood that noncompliance with a type of compliance requirement of a state project that is more than
inconsequential will not be prevented or detected by the entity's internal control.
A material weakness is a significant deficiency, or combination of significant deficiencies, that results in
more than a remote likelihood that material noncompliance with a type of compliance requirement of a
state project will not be prevented or detected by the entity's internal control.
Our consideration of internal control over compliance was for the limited purpose described in the first
paragraph of this section and would not necessarily identify all deficiencies in internal control that might
be significant deficiencies or material weaknesses. We did not identify any deficiencies in internal
control over compliance that we consider to be material weaknesses, as defined above.
This report is intended solely for the information and use of the City of Sebastian, Florida and
management, state awarding agencies and pass-through entities, and the State of Florida Office of the
Auditor General and is not intended to be and should not be used by anyone other than these specified
parties.
}{Ctetic,v, COV~cdtMIM,G~I'Au, '~1C1d./ ~ j,~ddealnlllsc!
C.tudc~cid ~b1+ttQ~nrrx+~tls-C'hwt~exfd
Harris, Cotherman, Jones, Price & Associates, Chartered
Certified Public Accountants
February 21, 2008
116
i
LJ
1
LJ
lJ
1
t
CITY OF SEBASTIAN, FLORIDA
' Schedule of Findings and Questioned Costs
State Projects
Fiscal Year Ended September 30, 2007
' SECTION I -SUMMARY OF AUDITORS' RESULTS
' Internal control over major State Projects:
Material weakness(es) identified? Yes X No
Reportable condition(s) identified not considered
to be material weaknesses? Yes X None reported
Type of auditors' report issued on compliance for
major projects:
Unqualified
Any audit findings disclosed that are required to be
reported in accordance with Chapter 10.550,
rules of the Auditor General?
Yes X No
Identification of major State ~iects
Name of State Project
Florida Department of Transportation:
Sccurity Improvements
Construct Fuel Farm
Hurricane Damage Repair
T-Hangar Construction
Lighting Maintenance
Business Plan
Install Airfield Signage and Lighting
Florida Department of State:
2002 Historic Preservation Special Category Grant
Dollar threshold used to distinguish between Type A
and Type B projects:
State CSFA No.
55.004
55.004
55.004
55.004
55.004
55.004
55.004
45.032
152 253
SECTION II -FINANCIAL STATEMENT FINDINGS
No matters were reported.
SECTION III -FINDINGS AND QUESTIONED COSTS -MAJOR STATE PROJECTS
No matters were reported.
SECTION IV -PRIOR YEAR FINDINGS AND QUESTIONED COSTS -MAJOR STATE
PROJECTS
No matters were reported.
117
City of Sebastian,~Florida
Schedule of Expenditures of State Financial Assistance
For the year ended September 30, 2007
Stale Agency
Pass-through Entity
State Project
Department of Transportation
Direct Projects:
Join[ Participation Agreement with Florida
Deparhnenl of Transporlafion Aviation
Administra[iorc
Security Lnpmvemenls
Constmct Fuel Famt
Business Plan
Install Airf eld Signago and Lighting
Hurricane Damage Repair
T-Hangar ConstrucP:on
Disn~ic[ Maintenance
Lighting Maintenance and Compensation Agreement
Total Department of Transportation
Depm~tment of State
DirtcC Project
Division of Historical Resotn-ees
2002 Special Category Grant
Total Deparhnent of State
Contract
CSFA Crant
No. No. Exucnditures
55.004 236232-I-94-OI 6,828
55.OD4 C12399-1-94-0I L86,387
55.004 236223-1-94x1 13,596
55.004 41v~4-1-94-a1 It,l~o
55,004 405122-t-72-10 78,887
55.004 4098631-94-01 432
55-023 405122-1-72-]0
45.032 SC356
TOTAL EXPENDITURES OF STATE FINANCIAL ASSISTANCE:
18,016
255,318
224,395
224,395
S 479,713
The accompanying notes are an integral pats of the audit.
118
1
City of Sebastian, Florida
' Notes to Schedule of Expenditures of State Financial Assistance
September 30, 2007
The accounting policies and presentation of the Single Audit Report of City of Sebastian, Florida, (the "City") have been
designed to conform to generally accepted accounting principles as applicable to governmental unites, including the reporting
and compliance requirements of the Audits of State, Local Governments, and Non-Profit Organizatimis and the Florida Single
' Audit Act.
A. Reporting Entity
' The repotting entity consists of City of Sebastian, the primary govenunent, and each of its component units. The City includes a
Schedule of Expendihtes of State Financial Assistance in [he Single Audi[ Section. Far FY 2006-07, none of the federal
awarded program expendihnes has met the Federal Single Audit tlueshold; therefore, the Schedule of Expendihnes of Federal
' Awards is not applicable hr the Single Audi[ Section.
B. Basis of Accounting
' Basis of accounting refers to when revenues and expenditures or expenses are recognized in the accounts and reported in the
financial statements. Basis of accounting relates to the tinting of measurements made, regardless of the measurement focus.
' The modified accrual basis of accounting is followed in the Schedule of Expendihtes of State Financial Assistance. Under the
modified accrual basis, revenues are recognized when [hey become measurable and available. Revenues are considered to be
available when they are collectible within the cun-ent period or soon enough thereafter to pay liabilities of the em-rent period. For
this purpose, the City considered revenues to be available if they are collected within one year after the end of flee current fiscal
period. Expendihnes generally are recorded when a liability is incuaed, as under accnial accounting.
t
I~~
119
CITY OF
THIS PAGE INTENTIONALLY LEFT BLANK
120
i
D
1
1
0
HOME OF PELICAN ISLAND
® Harris, Cotherman,
' Jones, Price 6>r Associates
Certified Public Accountants -Chartered
1070 North Highway A1A, Suite 250
' Vero Beach, FL 32963
Tel 772.234.8484 Inde endent Auditors'
Fax 772.234.8488 P _
Management Letter
t Honorable Mayor and Members of City Council
City of Sebastian
' Sebastian, Florida
We have audited the financial statements of the City of Sebastian, Florida, as of and for the fiscal year
ended September 30, 2007, and have issued our report thereon dated February 21, 2008.
' We conducted our audit in accordance with United States generally accepted auditing standards; the
standards applicable to financial audits contained in Government Auditing Standards, issued by the
' Comptroller General of the United States and the Florida Single Audit Act. We have issued our
Independent Auditors' Report on Compliance and Internal Control Over Financial Reporting,
Independent Auditors' Report on Compliance and Internal Control over Compliance Applicable to each
' Major State Project, and Schedule of Findings and Questioned Costs. Disclosures in those reports and
schedule, which are dated February 21, 2008, should be considered in conjunction with this management
letter.
t Additionally, our audit was conducted in accordance with the provisions of Chapter 10.550, Rules of the
Auditor General, which govern the conduct of local governmental entity audits performed in the State of
Florida and require that certain items be addressed in this letter.
The Rules of the Auditor General (Section 10.554(1)(1)1) require that we address in the management
' letter, if not already addressed in the auditors' reports on compliance and internal controls or schedule of
findings and questioned costs, whether or not recommendations made in the preceding annual financial
audit report have been followed. All findings and comments in the prior year have been resolved to our
satisfaction.
As required by the Rules of the Auditor General (Section 10.554(1)(1)2), the scope of our audit included a
review of the provisions of Section 218.415., Florida Statutes, regarding the investment of public funds.
In connection with our audit, we determined that the City of Sebastian, Florida complied with Section
218.415, Florida Statutes.
' The Rules of the Auditor General (Section 10.554(1)(1)3.) require that we address in the management
letter any findings and recommendations to improve financial management, accounting procedures, and
internal controls. In connection with our audit, we noted the following:
i
1
Currently the City does have a process for tracking projects that do not fall within the
standard purchase order system. However, we recommend the City develop a better
tracking process for these type projects. This process would include determining
percentage of completion periodically throughout the year. This will aid in ensuring
liability amounts are captured prior to year-end close out.
"Providing Vtsion and Direction ro our Clients"
Member AICPA Member AICPA Division For CPA Firms
Private Companies Pmc[ice Section
Member FICPA
121
Harris, Cotherman,
Jones, Price 6z Associates
Certified Pu61ic Accountanrs ~ Chartered
Honorable Mayor and Members of City Council
City of Sebastian
Page two
The Rules of the Auditor General (Section 10.554(1)(1)5.) require disclosure in the management letter of
the following matters if not already addressed in the auditors' reports on compliance and internal controls
or schedule of findings and questioned costs: (1) violations of laws, rules, regulations, and contractual
provisions that have occurred, or are likely to have occurred; (2) improper or illegal expenditures, (3)
control deficiencies that are not significant deficiencies, including, but not limited to: (a) improper or
inadequate accounting procedures (e.g., the omission of required disclosures from the financial
statements); (b) failures to properly record financial transactions; and (c) other inaccuracies, shortages,
defalcations, and instances of fraud discovered by, or that come to the attention of, the auditor.
The Rules of the Auditor General (Section 10.554(1)(1)6.) also require that the name or official title and
legal authority for the primary government and each component unit of the reporting entity be disclosed
in the management letter, unless disclosed in the notes to the financial statements. The legal authority for
the City of Sebastian, Florida is disclosed in the footnotes. The City of Sebastian, Florida's component
unit, the Police Officer's Pension Plan, was established under Section 58-46 through 58-54 Code of
Ordinances in October 1989.
As required by the Rules of the Auditor General (Section 10.554(1)(i)7.a), the scope of our audit included
a review of the provisions of Section 218.503(1), Florida Statutes, regarding financial emergencies. In
connection with our audit, we determined that the City of Sebastian, Florida has not met any of the
financial emergency conditions described in Section 218.503(1), Florida Statutes.
As required by the Rules of the Auditor General (Section ] 0.554(1)(1)7.6.), we determined that the annual
financial report for the City of Sebastian, Florida for the fiscal year ended September 30; 2007, filed with
the Department of Financial Services pursuant to Section 218.32(1)(a), Florida Statutes, is in agreement
with the annual financial audit report for the fiscal year ended September 30, 2007.
As required by the Rules of the Auditor General (Section 10.554(1)(i)7.c. and 10.556(7)), we applied
financial condition assessment procedures. It is management's responsibility to monitor the entity's
financial condition, and our Fmancial condition assessment was based in part on representations made by
management and the review of financial information provided by the same.
This report is intended solely for the information and use of the City of Sebastian, Florida and
management, federal and state awarding agencies and pass through entities, and the State of Florida
Office of the Auditor General and is not intended to be and should not be used by anyone other than these
specified parties.
}q~Clt#~tYr CD~Nctt»tAM,1j/hte, {~RtbJ~Q~deOitt~tl
t,.2t~r{t~! f~'itliLe I~CLnvx~agar~S- ~17AA+~tPJS>'
Harris/, Cotherman, Jones, Price & Associates, Chartered
Certified Public Accountants
February 21, 2008
Il
1
t
CII
122
1
i
i
1
1
1
1
i
1
1
CPIY Of
SE~st'~AN
HOME OF PELICAW ISLAND
1225 MAIN STREET • SEBASTIAN, FLORIDA 32958
TELEPHONE: (772) 589-5330 • FAX (772) 589-557D
Febniary 28, 2008
Harris, Cothennan, Jones, Price, & Associates
5070 North Highway, AlA, Suite 250
Vero Beach, Florida 32963
Gentlemen:
The following is my response to the management cmnment for the FY 2006-2007.
Process for Tracking Proiects:
The City has estaUlished a process to obtain a Urief status report on all currently budgeted projects from
the relevant project managers. This will assist flee Finance Department in ensuring that liability amounts
are captured for work that is performed in accordance with contractual documents, rather than by
purchase order commitments.
123
GTY OF
:. ,
~{ , -~_._... i
r .~
~~ ~t:
_~.._...
~}.~,
HOME OF PELICAN ISLAND
i
1
1
THIS PAGE INTENTIONALLY LEFT BLANK
i
1
1
124