City of Yuma Arizona Comprehensive Annual Financial Report For the Fiscal Year Ended June 30, 2014 City of Yuma Arizona Comprehensive Annual Financial Report CITY COUNCIL Douglas J. Nicholls, Mayor Cody T. Beeson, Deputy Mayor William Craft Gary Knight Leslie L. McClendon Edward C. Thomas Gary Wright ___________________________________________ City Administration Gregory K. Wilkinson City Administrator Ricky Rinehart Deputy City Administrator City Departments For the Fiscal Year Ended June 30, 2014 Prepared by: City Attorney Steven W. Moore City Clerk Lynda L. Bushong Community Development Laurie L. Lineberry Finance Department Donald (Pat) Wicks, CPA Director Wendy Wrenn, CPA Accounting Manager Sharon Willoughby Finance Donald (Pat) Wicks Fire Department Steven Irr, Chief Human Resources Jack Dodd Budget Manager Dana Alexander Terri Banuelos Linda Johnson Norma Sanchez Accountants Information Technology James L. Hamersley Municipal Court James F. Coil, Judge Parks and Recreation Deborah Wendt About the Cover: The City of Yuma celebrated its centennial year in 2014. One of the many events during the week-long celebration is shown on the lower cover with the dedication of a “Gateway to the Great Southwest” sign in downtown Yuma. The sign dedication event was conducted by the Honorable Janice K. Brewer, Governor of Arizona, and other dignitaries. The new sign is a modern version inspired by the original sign, also pictured, that once dominated the view down Main Street in Yuma’s early days. Police Department John J. Lekan, Chief Public Works Joel Olea Utilities Jay Simonton CITIZENS OF YUMA MAYOR and COUNCIL MUNICIPAL COURT City of YUMA CITY ADMINISTRATOR CITY ATTORNEY General Counsel Litigation Prosecution CITY ADMINISTRATION PARKS & RECREATION Administration Parks/Mall Maintenance Community Relations Recreation Heritage Area Parks Development City Clerk Civic Center Baseball Complex Risk Management Economic Development Arts and Culture HUMAN RESOURCES Human Resources Facilities Maintenance Golf Courses POLICE DEPARTMENT FINANCE COMMUNITY DEVELOPMENT Administration and Budget Field Services Administration Accounting Support Services Building Safety Customer Service Neighborhood Services FIRE DEPARTMENT Purchasing Community Planning Professional Services INFORMATION TECHNOLOGY SERVICES Business Application And Support Operations PUBLIC WORKS Community Risk Reduction Fleet Services Telecommunications And Support Special Operations Streets/Solid Waste Engineering UTILITIES Utility Treatment Utility Systems City of Yuma, Arizona COMPREHENSIVE ANNUAL FINANCIAL REPORT For the Year Ended June 30, 2014 TABLE OF CONTENTS INTRODUCTORY SECTION Letter of Transmittal from the Finance Director Certificate of Achievement for Excellence in Financial Reporting FINANCIAL SECTION Independent Auditors' Report Management's Discussion and Analysis (Required Supplementary Information) BASIC FINANCIAL STATEMENTS GOVERNMENT-WIDE FINANCIAL STATEMENTS Statement of Net Position Statement of Activities FUND FINANCIAL STATEMENTS Governmental Funds: Balance Sheet Reconciliation of the Balance Sheet-Governmental Funds to the Statement of Net Position Statement of Revenues, Expenditures and Changes in Fund Balances Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund BalancesGovernmental Funds to the Statement of Activities Proprietary Funds: Statement of Net Position Statement of Revenues, Expenses and Changes in Fund Net Position Statement of Cash Flows NOTES TO THE FINANCIAL STATEMENTS REQUIRED SUPPLEMENTARY INFORMATION Schedule of Funding Progress - Public Safety Personnel Retirement System Budgetary Comparison Schedules-General Fund and Major Special Revenue Funds: General Fund City Road Tax Fund NOTES TO REQUIRED SUPPLEMENTARY INFORMATION OTHER SUPPLEMENTARY INFORMATION Combining Balance Sheet-Nonmajor Governmental Funds Combining Statement of Revenues, Expenditures and Changes in Fund Balances-Nonmajor Governmental Funds Budgetary Comparison Schedules: Major Governmental Funds Not Included In Required Supplementary Information Debt Service Fund Nonmajor Governmental Funds Capital Projects Fund Local Transportation Assistance Special Revenue Fund Public Safety Tax Special Revenue Fund Highway User Revenue Fund Grants Fund Community Redevelopment Fund Two Percent Tax Special Revenue Fund Yuma Mall Maintenance Special Revenue Fund i Page v ix 3 5 20 21 24 25 26 27 28 29 30 31 54 55 58 59 64 66 68 69 70 71 72 73 74 75 76 City of Yuma, Arizona COMPREHENSIVE ANNUAL FINANCIAL REPORT For the Year Ended June 30, 2014 TABLE OF CONTENTS (Concluded) FINANCIAL SECTION (Concluded) Nonmajor Proprietary Funds: Enterprise Funds: Combining Statement of Net Position Combining Statement of Revenues, Expenses and Changes in Fund Net Position Combining Statement of Cash Flows Budgetary Comparison Schedules: Water Enterprise Fund Wastewater Enterprise Fund Solid Waste Enterprise Fund Radio Communication Enterprise Fund Desert Hills Golf Course Enterprise Fund Internal Service Funds: Combining Statement of Net Position Combining Statement of Revenues, Expenses and Changes in Fund Net Position Combining Statement of Cash Flows Budgetary Comparison Schedule - Equipment Replacement Internal Service Fund Budgetary Comparison Schedule - Equipment Maintenance Internal Service Fund Budgetary Comparison Schedule - Insurance Reserve Internal Service Fund Page 78 79 80 81 82 83 84 85 88 89 90 91 92 93 STATISTICAL SECTION Net Position by Component - Last Ten Fiscal Years Changes in Net Position - Last Ten Fiscal Years Fund Balances of Governmental Funds - Last Ten Fiscal Years Changes in Fund Balances of Governmental Funds - Last Ten Fiscal Years Governmental Funds Tax Revenues by Source - Last Ten Fiscal Years Governmental Funds Intergovernmental Shared Revenues - Last Ten Fiscal Years Intergovernmental Revenues - Grants and Other - Last Ten Fiscal Years Taxable Sales by Category - Last Ten Fiscal Years Direct and Overlapping Sales Tax Rates - Last Ten Fiscal Years Ratio of Outstanding Debt by Type - Last Ten Fiscal Years Ratio of General Bonded Debt to Assessed Value and General Bonded Debt per Capita - Last Ten Fiscal Years Computation of Direct and Overlapping Debt Legal Debt Margin Information Schedule of Municipal Property Corporation Debt Service Requirements to Maturity and Coverage Pledged Tax Collections - Last Ten Fiscal Years Demographic and Economic Statistics - Last Ten Calendar Years Principal Employers - Current Year and Nine Fiscal Years Ago Full-Time Equivalent City Government Employees by Function - Last Ten Fiscal Years Operating Indicators by Function - Last Ten Fiscal Years Capital Asset Statistics by Function - Last Ten Fiscal Years ii 98 99 101 102 103 104 105 106 107 108 109 110 111 112 113 114 115 116 117 118 INTRODUCTORY SECTION iii iv FINANCE DEPARTMENT One City Plaza Yuma, Arizona 85364-1436 (928) 373-5087 Fax: (928) 373-5084 City of YUMA October 16, 2014 To the Citizens, Honorable Mayor and City Council, and City Administrator The Finance Department is pleased to present the Comprehensive Annual Financial Report (CAFR) of the City of Yuma, Arizona for the fiscal year ended June 30, 2014. The report includes the independent auditors’ report as required by City Charter Article XIII, Section 12, and by Arizona Revised Statutes, Section 9-481. The report is prepared in conformity with generally accepted accounting principles and standards set forth by the Governmental Accounting Standards Board (GASB). Responsibility for both the accuracy of the data and the completeness and fairness of the presentation, including disclosures, rests with the City. Management of the City is responsible for establishing and maintaining internal controls to ensure that the assets of the City are protected from loss, theft or misuse and to ensure that adequate accounting data is compiled to allow for the preparation of financial statements in conformity with generally accepted accounting principles as they apply to governmental units. Internal control is designed to provide reasonable, but not absolute, assurance that these objectives are met. The concept of reasonable assurance recognizes that: 1) the cost of a control should not exceed the benefits likely to be derived; and, 2) the calculation of costs and benefits requires estimates and judgments by management. To the best of our knowledge and belief, the enclosed data is accurate, in all material respects, and is reported in a manner designed to present fairly the financial position and results of operations as measured by the financial activity of its various funds. All disclosures necessary to enable the reader to gain an understanding of the City’s financial activities have been included. Heinfeld, Meech & Co., P.C., a public accounting firm fully licensed and qualified to perform audits of local governments within the State of Arizona, have audited the City’s financial statements. The goal of the independent audit was to provide reasonable assurance that the financial statements of the City of Yuma, Arizona for the fiscal year ended June 30, 2014, are free of material misstatement. The independent audit involved examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements; assessing the accounting principles used and significant estimates made by management; and evaluating the overall financial statement presentation. The independent auditors concluded, based upon the audit, that the City of Yuma’s financial statements for the fiscal year ended June 30, 2014, are fairly presented in conformity with accounting principles generally accepted in the United States. The independent auditors’ report is presented as the first component of the financial section of this report. The independent audit of the financial statements of the City was part of a broader, federally mandated “Single Audit” designed to meet the special needs of Federal grantor agencies. The standards governing Single Audit engagements require the independent auditor to report not only on the fair presentation of the financial statements, but also on the audited government’s internal controls and compliance with legal requirements, with special emphasis on internal controls and legal requirements involving the administration of Federal awards. These reports are available in the City’s separately issued Single Audit Reporting Package. v This report has been prepared using the financial reporting requirements as outlined in GASB Statement No. 34, Basic Financial Statements – and Management’s Discussion and Analysis – for State and Local Governments. This standard requires that management provide a narrative introduction, overview, and analysis to accompany the basic financial statements in the form of Management’s Discussion and Analysis (MD&A). This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it. The MD&A can be found immediately following the independent auditors’ report. PROFILE OF THE CITY OF YUMA The City of Yuma was incorporated in 1914 and adopted its first charter in June of that year. Yuma is the economic hub and county seat of Yuma County. The City is located along the Colorado River in southwestern Arizona and is equidistant from the major population centers of Phoenix, Arizona and San Diego, California. The City operates under a council-manager form of government. The City Council consists of six members elected at large for staggered four-year terms. The elected Mayor is the seventh voting member of council, who, along with the remaining council members is elected on a non-partisan basis. The City Council is responsible for passing ordinances, adopting the budget, appointing members of commissions and hiring the City Administrator. The City Administrator carries out the policies and ordinances of the City Council, oversees the day-to-day operations of the City and appoints the various department heads. The City provides a full range of municipal services. These include public safety (police, fire and municipal court), street construction and maintenance, water and wastewater utility services, sanitation and residential refuse collection, parks, recreation and culture, planning and zoning, and general administrative and support services. This CAFR includes the financial activity of the primary government, which includes several enterprise activities, as well as its blended component units. Component units are legally separate units for which the primary government is financially accountable. Blended component units, while legally separate, are part of the City’s operations and are combined within the report. The Yuma Municipal Property Corporation and the City of Yuma Employee Benefits Trust have been included in the reporting entity. Conversely, the report does not include the City of Yuma Housing Authority as the City is not financially accountable for the authority, nor does the City directly or indirectly rely upon or benefit from the financial activity of the authority. ECONOMIC CONDITION AND OUTLOOK Industrial Expansion. Yuma’s economy is based primarily in agriculture, tourism and government, although further diversification continues. Agriculture remains the Yuma area’s dominant industry, producing more than $1 1 billion in revenues annually . Several major agricultural companies maintain operations here. Their chief consumer products of packaged produce and salad mixes continue to be popular products for today’s convenience-minded customers. The Yuma area’s stable allocation of Colorado River water will assure that agriculture remains the foundation of Yuma’s economy. The United States Marine Corps Air Station (MCAS) and United States Army Yuma Proving Ground (YPG) help provide economic stability. These two installations continue to be cornerstones in the military’s flight training and equipment testing programs. Both should survive any continued base closure efforts by the federal government. st In fact, both installations are enjoying new construction and expansion to meet their needs into the 21 century. MCAS is the home of one of the first squadrons of the new Joint Strike Fighter, the new generation aircraft being adopted by all military services. Although manufacturing currently accounts for less than 10% of countywide employment, the City’s partnership with the Greater Yuma Economic Development Corporation continues to attract attention to the area. Several companies have located or expanded operations in Yuma in recent years. 1 Source: Greater Yuma Economic Development Corporation vi Economic Growth. Yuma’s most reliable indicator of the condition of its economy is sales tax. The graph below reflects the last ten years of data. General sales tax saw an increase of 1.4% for fiscal year 2014. Tax data show that Retail Trade, annually the largest segment of the sales tax measure, continues to improve. For fiscal year 2014, Retail Trade showed an increase of 3.1% over 2013. Construction sales tax declined some (8.2)% for the year to offset some of the gains in retail; however, the data for the last six months of the fiscal year show a promising 4.4% increase. Projects at MCAS will continue into 2014 to be joined by major construction at Yuma Regional Medical Center. Overall, sales taxes are anticipated conservatively to grow 3% for fiscal year 2015. 25 General Sales Tax (millions) 20 15 10 5 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Fiscal Year Ending June 30, Tourism. Yuma has enjoyed an influx of seasonal residents for decades. Visitors from throughout the United States and Canada continue to call Yuma their winter home. This contributes to the strengthening of sales tax collections. LONG-TERM FINANCIAL PLANNING Yuma Crossing National Heritage Area. Plans to restore, preserve and interpret the Yuma Crossing National Heritage area began more than thirty years ago and work continued throughout 2014 with the opening of Centennial Beach. This much-needed expansion of beach area along the Colorado River not only enhances the beauty of the river’s edge but provides access to the river for recreation. The river, once the primary reason for Yuma’s existence, was ignored for years as community growth and new development moved away from the riverfront. Awareness of the river’s importance has re-emerged, culminating in the establishment of the Yuma Crossing National Heritage Area in 2000, the first such National Heritage Area west of the Mississippi River. During fiscal year 2014, city and Federal funding continues to manage and improve both the West and East Wetlands to restore natural vegetation and wildlife habitat, and improve recreational opportunities for area residents. The City will also continue its focus in developing historic and cultural activities in these areas as these are so important in meeting the Council’s goals in enriching the area’s cultural attributes. Progress in providing opportunities for local residents and in attracting employers to the area to diversify the economy is dependent on continuing these plans. Downtown redevelopment. Revitalization of the downtown area is a vital component of management of the Heritage Area. The new hotel and conference center are cornerstones of the public/private partnership that is developing the river area. The recent completion of the Judge John M. Roll U.S. Courthouse will add to the economic vitality of the area. vii FINANCIAL INFORMATION Budgetary Controls. The annual budget serves as the foundation for City financial planning and control. The City maintains budgetary controls with the objectives to ensure compliance with legal provisions embodied in the annual appropriated budget, approved by the City Council. Activities of the General Fund, Special Revenue Funds, Debt Service Funds, Capital Projects Fund, Enterprise Funds, and three of the City’s Internal Service Funds are included in the annual appropriated budget. As with the governmental funds, the City’s proprietary funds are presented on a current financial resources basis to account for capital and debt-related expenditures. The City maintains an encumbrance accounting system as one technique of accomplishing budgetary controls. Encumbered amounts lapse at year-end. However, encumbrances generally are re-appropriated as part of the following year’s budget. As demonstrated by the budgetary schedules included in the financial section of this report, the City continues to meet its responsibility for sound financial management. In addition to budgetary schedules, Note I-E in the Notes to the Financial Statements beginning on page 33 describes in detail the budget process used by the City. AWARDS 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 for its comprehensive annual financial report for the fiscal year ended June 30, 2013. This is the thirty second consecutive year the City has received this prestigious award. In order to be awarded a Certificate of Achievement, the City published an easily readable and efficiently organized comprehensive annual financial report. The report satisfied both generally accepted accounting principles and applicable legal requirements. A Certificate of Achievement is valid for a period of one year only. We believe that our current comprehensive annual financial report continues to meet the Certificate of Achievement Program’s requirements and we are submitting it to the GFOA to determine its eligibility for another award. I wish to express my sincere thanks to the employees of the Accounting Division for their dedicated service in preparing this report. Their work, along with those services provided by other members of the Finance Department, has made this report possible. The cooperation and assistance of the accounting firm of Heinfeld, Meech & Co., P.C., also contributed significantly to its production. Finally, I wish to thank the Mayor and Council, City Administrator, and the City Staff for their continued support. Respectfully submitted, Donald (Pat) Wicks, CPA Finance Director viii x FINANCIAL SECTION 1 2 3033 N. Central Ave., Suite 300 Phoenix, Arizona 85012 Tel (602) 277-9449 Fax (602) 277-9297 INDEPENDENT AUDITOR’S REPORT Honorable Mayor and Members of the City Council City of Yuma, Arizona Report on the Financial Statements We have audited the accompanying financial statements of the governmental activities, business-type activities, each major fund, and the aggregate remaining fund information of City of Yuma, Arizona (the City), as of and for the year ended June 30, 2014, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents. Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility 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 from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Opinions In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, business-type activities, each major fund and the aggregate remaining fund information of the City of Yuma, Arizona, as of June 30, 2014, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. Change in Accounting Principle As described in Note I-B, the City implemented the provisions of the Governmental Accounting Standards Board (GASB) Statement No. 65, Items Previously Reported as Assets and Liabilities, for the year ended June 30, 2014, which represents a change in accounting principle. Our opinion is not modified with respect to this matter. TUCSON • PHOENIX • FLAGSTAFF www.heinfeldmeech.com  Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis on pages 5 through 15 and pension and budgetary comparison information on pages 54 through 59 be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The introductory section, combining and individual fund financial statements and schedules, and statistical section are presented for purposes of additional analysis and are not a required part of the basic financial statements. The combining and individual fund financial statements and schedules are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining and individual fund financial statements and schedules information is fairly stated in all material respects in relation to the basic financial statements as a whole. The introductory and statistical sections have not been subjected to the auditing procedures applied in the audit of the basic financial statements and, accordingly, we do not express an opinion or provide any assurance on them. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated October 16, 2014, on our consideration of City of Yuma, Arizona’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 in considering City of Yuma, Arizona’s internal control over financial reporting and compliance. HEINFELD, MEECH & CO., P.C. CPAs and Business Consultants October 16, 2014  MANAGEMENT’S DISCUSSION AND ANALYSIS (Required Supplementary Information) As management of the City of Yuma, we offer readers of the City of Yuma's financial statements this narrative overview and analysis of the financial activities of the City of Yuma for the fiscal year ended June 30, 2014. We encourage readers to consider the information presented here in conjunction with additional information that we have furnished in our letter of transmittal in the introductory section of this report. FINANCIAL HIGHLIGHTS • On a government-wide basis, the City’s net position decreased by $13.5 million for the fiscal year, governmental activities decreased by $13.3 million while business-type activities of the City decreased $0.2 million. • The City’s government-wide net position totaled $475.7 million at June 30, 2014. Of this amount, $87.3 million is available (unrestricted) to finance ongoing programs, $40.4 million in governmental programs and $46.9 million in business activities. OVERVIEW OF THE FINANCIAL STATEMENTS This discussion and analysis are intended to serve as an introduction to the City of Yuma's basic financial statements. The City of Yuma's basic financial statements comprise three components: 1) government-wide financial statements; 2) fund financial statements; and 3) notes to the financial statements. This report also contains other supplementary information in addition to the basic financial statements. Government-wide financial statements. The government-wide financial statements are designed to provide readers with a broad overview of the City of Yuma's finances, in a manner similar to a private-sector business. The statement of net position presents information on all of the City's assets and deferred outflows of resources, and liabilities and deferred inflows of resources, with the difference between the assets and outflows minus the liabilities and inflows reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the City is improving or deteriorating. The statement of activities presents information showing how the government's net position changed during the most recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (uncollected taxes and earned but unused vacation leave are two examples). Both of the government-wide financial statements distinguish functions of the City of Yuma that are principally supported by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities). The governmental activities of the City include general government, public safety, streets, environmental health and protection, community design and development and parks, recreation and culture. The business-type activities of the City include water, wastewater, solid waste, radio communications and golf course operations. The government-wide financial statements can be found on pages 20-21 of this report. Fund financial statements. A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City of Yuma, like other local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the City can be divided into two categories: governmental funds and proprietary funds. 5 MANAGEMENT’S DISCUSSION AND ANALYSIS Governmental funds. Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government's near-term financing requirements. Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the government's near-term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities. The City maintains eleven individual governmental funds. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures, and changes in fund balances for the three funds considered to be major funds. Data from the other eight governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these nonmajor governmental funds is provided in the form of combining statements beginning on page 64. Major Governmental Funds: General City Road Tax Debt Service Nonmajor Governmental Funds continued: Local Transportation Assistance Public Safety Tax Highway User Revenue Grants Two Percent Tax Yuma Mall Maintenance Nonmajor Governmental Funds: Community Redevelopment Capital Projects The City adopts annual appropriated budgets for all of its governmental funds. Budgetary comparison statements have been provided to demonstrate compliance with these budgets. The basic governmental fund financial statements can be found starting on page 24 of this report. Proprietary funds. The City of Yuma maintains two different types of proprietary funds. Enterprise funds are used to report the same functions presented as business-type activities in the government-wide financial statements. The City of Yuma uses enterprise funds to account for its Water, Sewer, and Solid Waste Authority and for its Radio Communications and golf courses. Internal service funds are an accounting device used to accumulate and allocate costs internally among the City's various functions. The City of Yuma uses internal service funds to account for its equipment replacement and maintenance programs, liability insurance, and for its workers compensation and employee health insurance. Because these services predominantly benefit governmental rather than business-type functions, they have been included within governmental activities in the government-wide financial statements. Major Enterprise Funds: Water Fund Wastewater Fund Nonmajor Enterprise Funds: Solid Waste Radio Communications Desert Hills Golf Courses Nonmajor Internal Service Funds: Equipment Replacement Equipment Maintenance Insurance Reserve Employee Benefits Trust Workers Compensation Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The proprietary fund financial statements group major and nonmajor proprietary funds in a manner similar to governmental fund statements. Conversely, the internal service funds are combined into a single, aggregated presentation in the proprietary fund financial statements. Individual fund data for the internal service funds is provided in the form of combining statements, beginning on page 88. The City adopts annual appropriated budgets for all of its proprietary funds with the exception of two internal service funds: Employee Benefits Trust and Workers Compensation. Budgetary comparison statements for the remaining proprietary funds are included within the report to demonstrate compliance with these budgets. 6 MANAGEMENT’S DISCUSSION AND ANALYSIS The basic proprietary fund financial statements can be found on pages 28-30 of this report. Notes to the financial statements. The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. The notes to the financial statements can be found beginning on page 31 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 of Yuma's progress in funding its obligation to provide pension benefits to its employees. Required supplementary information can be found starting on page 54 of this report. The combining statements referred to earlier in connection with nonmajor governmental, proprietary and internal service funds are presented immediately following the required supplementary information on pensions and budgets. Combining and individual fund statements and schedules can be found starting on page 64. GOVERNMENT-WIDE FINANCIAL ANALYSIS Statement of Net Position. As noted earlier, net position may serve over time as a useful indicator of a government's financial position. In the case of the City of Yuma, assets exceeded liabilities by $475.7 million at the close of the fiscal year. Governmental Activities Business-type Activities June 30, Net Position: 2013 (millions) Current and other assets Capital assets Total assets Long-term liabilities outstanding Other liabilities Total liabilities Net position: Net Investment in capital assets Restricted Unrestricted Total net position 2014 $ 86.0 300.8 386.8 114.6 11.8 126.4 2013 2014 As restated $ 92.1 316.0 408.1 122.9 11.5 134.4 Total $ 76.3 310.1 386.4 165.6 5.5 171.1 As restated $ 2013 2014 73.2 321.9 395.1 173.9 5.7 179.6 $ 162.3 610.9 773.2 280.2 17.3 297.5 As restated $ 165.3 637.9 803.2 296.8 17.2 314.0 198.0 208.4 159.4 163.2 357.4 371.6 22.0 40.4 22.4 42.9 9.0 46.9 9.0 43.3 31.0 87.3 31.4 86.2 273.7 $ 215.3 215.5 $ 475.7 $ 260.4 $ $ $ 489.2 The largest portion of the City of Yuma's net position reflects its investment in capital assets (e.g., land, buildings, machinery), less any related outstanding debt used to acquire those assets. The City uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the City's investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to pay these liabilities. The remaining balance of unrestricted net position may be used to meet the government’s ongoing obligations to citizens and creditors. At the end of the current fiscal year, the City is able to report positive balances in all three categories of net position, including the City as a whole, as well as for its separate governmental and business-type activities. The same held true for the previous fiscal year. Net position dropped to $475.7 million, down $13.5 million from the prior year. Governmental activities decreased $13.3 million while business-type activities decreased $0.2 million. Capital asset acquisitions were lower than the depreciation expense this year attributing to the decrease in Capital assets in both governmental and business-type activities. Unrestricted net position are those assets available to finance programs in the upcoming fiscal year and would increase when the portion of taxes and other revenues exceed operating expenses but are not invested in capital assets. 7 MANAGEMENT’S DISCUSSION AND ANALYSIS Statement of Activities. Already noted was the statement of activities’ purpose in presenting information in how the government's net position changed during the most recent fiscal year. A chart of changes in net position follows. Governmental activities Changes in Net Position Fiscal Year Ended June 30, Business-type activities 2013 (millions) Revenues Program revenues: Charges for services Operating grants and contributions Capital grants and contributions General revenues: Property taxes Sales taxes Franchise taxes Intergovernmental, unrestricted Unrestricted investment earnings 2014 $ Total revenues Expenses: General government Public safety Streets Parks, recreation and culture Environmental health and protection Community design and development Interest on long-term debt Water Wastewater Solid Waste Radio Communications Golf courses Total expenses Transfers Change in net position $ as restated 11.8 $ Total 2013 2014 12.4 $ 44.4 3.3 0.6 4.0 0.6 9.4 38.0 3.0 26.6 0.5 2013 as restated as restated 43.6 $ 56.2 7.0 7.8 3.3 7.6 4.0 8.4 9.5 37.6 3.0 26.0 0.8 0.2 - 9.4 38.0 3.0 26.6 0.7 9.5 37.6 3.0 26.0 0.8 93.2 93.9 51.6 51.4 144.8 145.3 10.3 46.6 25.3 13.6 0.1 5.1 4.8 105.8 (0.7) 10.3 43.0 15.0 12.8 0.2 5.1 5.8 92.2 (0.1) 24.7 17.1 3.1 4.1 3.5 52.5 0.7 23.4 16.3 3.2 4.7 2.5 50.1 0.1 10.3 46.6 25.3 13.6 0.1 5.1 4.8 24.7 17.1 3.1 4.1 3.5 158.3 - 10.3 43.0 15.0 12.8 0.2 5.1 5.8 23.4 16.3 3.2 4.7 2.5 142.3 - 1.4 $ (13.5) (13.3) $ 1.6 $ (0.2) $ 2014 $ $ $ 56.0 3.1 For the fiscal year, net position decreased $13.5 million, with $13.3 million of the decrease coming from governmental activities. The decrease in assets in governmental activities is related primarily to adjustments to capital assets for impairments from cancelling capital projects during the year. These asset impairments are reflected as Streets program expenses for the year, partially accounting for the increase in Streets expenses to $25.3 million. The reader should remember that the basis of accounting used in the government-wide statement of activities excludes capital expenditures while its revenues include general taxes whose primary purpose is for the construction of those very assets or their related debt service (i.e., public safety or road sales taxes). 8 MANAGEMENT’S DISCUSSION AND ANALYSIS Governmental Activities Revenues Governmental activities revenues totaled $93.2 million for fiscal year 2014, down from 2013, mostly in operational grants and contributions. Local sales taxes remain the largest revenue source for the City and are comprised of the 1% general sales tax along with a .5% road tax and a .2% public safety tax. State-shared revenues are the City’s second largest revenue source. State-shared revenues include state sales tax, urban revenue sharing (income tax), auto in-lieu tax and highway user funds (gas tax). Sales taxes and state shared revenues account for 69.3% of governmental revenues for the year. Capital grants and contributions, the third segment of governmental activities revenues, include donations and capital asset contributions. Charges for services count building permits and inspections, fines, recreation fees, police services and civic center rental fees among its largest sources. The charges for services category amounts to 12.6% of governmental revenues. Property taxes represent 10.1% of governmental revenues. The large majority of property taxes are levied for general purposes with a small levy for downtown mall maintenance. No property taxes are levied for debt service. Various grants and contributions and franchise taxes account for most of the remaining governmental revenues. Some of the more significant changes in governmental activities revenues are noted: • • • • Sales taxes increased 1.4% from 2013 as the economy continues to improve. Intergovernmental revenues increased $634 thousand or 2.4%. State-shared income taxes were anticipated to increase 6.4% but due to a census recalculation from 2010 only increased 1.6% from 2013, while state-shared gas tax increased 7.3%. State-shared sales taxes decreased by 1.2% due to the census recalculation. Charges for services decreased by $591 thousand (4.8%) primarily from the Ambulance Service as FY2013 had three additional months of activity for the start up in FY2012. Property taxes decreased 1.6% to $9.4 million as the City Council opted not to increase the property tax rate to completely offset a decline in assessed valuation. RevenuesGovernmental Activities Sales taxes 40% Franchise taxes 3% Intergovernmental, unrestricted 28% Property taxes 10% Capital grants and contributions 2% Operating grants and contributions 3% Unrestricted investment earnings <1% Charges for services 13% Expenses Governmental expenses totaled $105.8 million for the fiscal year. Of the expenses, 44% or $46.6 million is related to public safety for police, fire and municipal court services. Parks, recreation and culture expenses amounted to $13.6 million, or 12.9% and Streets was $25.3 million, 23.9%, while environmental health and community design and development expenses amounted to 0.08% and 4.8% respectively. General government expenses came to $10.3 million, or 9.7%. Interest on long-term debt was $4.8 million, or 4.5% of governmental expenses. Overall, governmental activities expenses increased $13.6 million over 2013, led by an increase in Streets expenditures of $10.3 million, mainly due to adjustments to capital assets for impairments from cancelling capital projects. 9 MANAGEMENT’S DISCUSSION AND ANALYSIS Expenses and Program Revenues-Governmental Activities 50.0 45.0 40.0 35.0 Millions Expenses Program Revenues 30.0 25.0 20.0 15.0 10.0 5.0 General government Public safety Streets Parks, recreation Environmental and culture health and protection Community design and development Interest on longterm debt The chart above compares governmental activities with their respective program revenues, if any. Because the ultimate beneficiary of services of these types is often difficult to ascertain or the services apply to a broad spectrum of users (such as in fire protection), user fees are not created and general revenues provide the funding support for most of these services. Moreover, where ultimate users of the services are determinable, program revenues may generate only a portion of the funding, such as in recreation programs. Business-type activities Revenues General revenues do not support the City’s business-type activities; thus, the largest source of revenues comes from charges for services. Of the $44.4 million in charges for services, 83.9% comes from the City’s two utility operations, water and wastewater. The remaining charges are from solid waste, radio communications and the City’s two golf courses, Desert Hills and Desert Hills Par 3. The $7.0 million in contributions are payments for capacity charges, development fees, and constructed additions to the City’s water and wastewater infrastructure by subdivision and other developers as well as grant funds for the radio communications fund. Finally, investment earnings make up less than 0.43% of revenues for the City’s business activities. Revenues-Business-type Activities Charges for services 85% Capital grants and contributions 15% 10 MANAGEMENT’S DISCUSSION AND ANALYSIS Expenses Water and wastewater services account for 79.6% of the City’s business-type activities with solid waste, radio communication and golf courses making up the remaining 20.4%. Water expenses amounted to $24.7 million while wastewater expenses totaled $17.1 million. Solid Waste, Radio Communications, and Desert Hills Golf Courses recorded expenses of $3.1 million, $4.1 million and $3.5 million, respectively, for a total of $10.7 million. Because the City’s business-type activities are supported by user charges, the chart above shows more reliance on program revenues. Moreover, for both water and wastewater, program revenues include capacity charges for new service and developer additions to the utility infrastructure. FINANCIAL ANALYSIS OF THE CITY’S FUNDS Governmental funds. The combined fund balances of governmental funds for the fiscal year ended June 30, 2014, is $44.1 million, a decrease from 2013 of $5.4 million. A review of some of the more significant funds follows. General Fund The fund balance of the General Fund decreased by $1.9 million for the fiscal year. Revenues decreased by $790 thousand. Sales taxes, the city’s largest source of General Fund revenues, increased $268 thousand (1.4%) to $19.5 million as the local economy continues to improve after the recession. State-shared income taxes were anticipated to increase 6.4% but due to a census recalculation from 2010 only increased 1.6%, up $150 thousand to $9.65 million, while state-shared vehicle registration tax (auto lieu tax) increased 5.5% to $3.1 million. Stateshared sales taxes decreased $92 thousand or 1.2% also due to a census recalculation from 2010. Total expenditures increased $1.9 million, or 3.3%, to $59.1 million. Most of the increase occurred in Public Safety expenditures, in part due to the City needing to use current staff operating ambulance services in an overtime status. Police overtime also exceeded anticipated overtime need. City Road Tax Fund This fund accounts for the one-half cent sales tax for use on the City’s roadways in conjunction with HURF. The fund balance grew by $1.6 million for the year. In the same manner as general sales tax in the General Fund, sales taxes increased in 2014 to $9.75 million. Operational expenditures increased from 2013, as the fund had an increase in personnel expenditures due to engineering moving into the fund. 11 MANAGEMENT’S DISCUSSION AND ANALYSIS Debt Service Debt Service Fund expenditures remained at $13.5 million per debt retirement schedules. Fund balance decreased due to service reserves accumulated in accordance with the development agreement for the Yuma Palms regional center no longer needed. Highway User Revenue Fund (HURF) This fund, which accounts for the expenditure of state-shared gasoline taxes, showed an increase in fund balance of $0.5 million for the year. The City’s portion of those taxes increased by 7% for the fiscal year to $6.3 million. All maintenance expenditures for streets and retention basins are made in the HURF Fund. Expenditures decreased from 2013 by $0.2 million to $5.8 million. Grants Fund The City continues to receive much needed assistance from both the state and federal levels. During 2014, revenues decreased to $2.4 million, due to grants completing early in the fiscal year. Again this year, Homeland Security was the primary source of grants, funding the Operation Stone Garden. In addition, the City of Yuma received funding from the Environmental Protection Agency for conducting community wide assessments at potential Brownfields sites contaminated with Petroleum or Hazardous Substances. Community Redevelopment Fund The City continued to utilize, in part, its Community Development Block Grant funding for eligible street infrastructure improvements and for affordable housing rehabilitation, and its U.S. Department of Housing and Urban Development Home Grant Programs to help with housing rehabilitation in the Yuma High revitalization area. Community Development Block Grant revenues increased to $1.4 million for 2014. Capital Projects Fund The Capital Projects Fund’s fund balance dropped to $12.7 million this year as the city continued to expend the proceeds of the 2007 bond sale. Capital expenditures decreased in 2014 to $4.8 million. Proprietary funds. The City’s enterprise funds posted an overall decrease in net position of $0.2 million for the fiscal year ended June 30, 2014. Results were mixed between the various funds with the Wastewater, and Solid Waste Funds posting increases in net position while the Water, Radio Communications and Desert Hills Golf Course Funds showed the reverse. Water Enterprise Fund Operating revenues for the Water Fund increased by $0.7 million or 3.2% for the year ending June 30, 2014. Operating expenses increased by 8.7% with attendant improvements coming on line. With these changes, operating income fell 25.8% to $2.5 million. Capital contributions, increasing to $2.3 million, kept the fund’s net position to only a decrease of $36,955. Wastewater Enterprise Fund The Wastewater Fund operating revenues increased 1.1% from fiscal 2013. Rate-based charges increased 1.1% to $13.1 million. Operating expenses increased by 6.9% with income from operations decreasing to $0.3 million. Capital contributions decreased by some $1.5 million mostly due to the decrease of capacity charges for the Avenue B to C Colonia improvement district. Capital contributions led to the fund’s net position increase of $631,888. 12 MANAGEMENT’S DISCUSSION AND ANALYSIS Radio Communications With the reclassification of the Radio Communications fund to an enterprise fund, federal grants for the Yuma Regional Communications System were classified in the fund. This includes intergovernmental revenues and expenses of $1.9 million. Operating revenues increased 4.1% to $3.5 million due to an increase in intergovernmental revenues and a decrease in other agencies communication product purchases through the YRCS. Operating expenses decreased 11% to $4.2 million, with the fund’s net position decreasing to $3 million. GENERAL FUND BUDGETARY HIGHLIGHTS A detailed budgetary comparison schedule for the fiscal year ended June 30, 2014, can be found starting on page 55. A summary of that schedule follows: Budget Variance Original Final Actual with Final Revenues and Transfers In Taxes $ 32,929,200 $ 32,929,200 $ 32,109,065 $ (820,135) Intergovernmental 21,097,788 21,097,788 20,299,664 (798,124) Other 7,086,280 7,086,280 7,992,636 906,356 557,323 557,323 1,043,982 486,659 Transfers In 61,670,591 61,670,591 61,445,347 (225,244) Total Expenditures and Transfers Out Expenditures 58,787,897 58,962,897 59,092,324 (129,427) 4,377,807 4,377,807 4,258,146 119,661 Transfers Out 63,165,704 63,340,704 63,350,470 (9,766) Total Change in Fund Balance $ (1,495,113) $ (1,670,113) $ (1,905,123) $ (235,010) General Fund revenues and transfers ended the year $0.2 million under expectations. The census recalculation for 2010 accounted for $0.7 million of this in state sales tax and state shared revenues, while building permits and fees decreased this by $0.8 million. City Court Fines accounted for $0.3 million of the shortfall. The important revenue source of city sales tax increased by 1.4%. Expenditures for the fund came in at $129,427 over budget due to overtime needed in excess of projections by the Ambulance Transport division. General Government, Parks and Recreation, and Community Development showed savings of $0.3 million, $0.5 million, and $0.2 million respectfully. Savings in budget occurred in most departments with the City’s drive to reduce expenditures throughout the year. The City continued to target all areas of expenditure reduction. Due to provisional positions added during the year, the General Fund’s anticipated reduction of fund balance increased from a reduction of $1.7 million to a reduction of $1.9 million. CAPITAL ASSETS At June 30, 2014, the City of Yuma’s investment in capital assets in both governmental and business-type activities amounted to $610.9 million, net of depreciation. This includes land, buildings, equipment, and infrastructure (roadways and bridges). Capital assets for governmental activities decreased by 4.8% while business-type capital assets decreased by 3.7%. These changes included the following: • • • • The Avenue 3E Bridge widening project, a major link to Marine Corps Air Station-Yuma and to local agriculture cooling plants from Interstate 8, was completed. th The 8 Avenue Road road construction project was completed. A number of major water and sewer lines were completed. th nd Removing original infrastructure assets that were replaced in prior year – includes 24 street and 32 street improvements. 13 MANAGEMENT’S DISCUSSION AND ANALYSIS Change in Capital Assets (In Millions) Governmental Activities July 1, Net Additions/ June 30, 2013 Deletions 2014 Land Buildings Improvements Infrastructure Equipment Construction in Progress Accumulated Depreciation Total Business-type Activities July 1, Net Additions/ June 30, 2013 Deletions 2014 Total $ 58.8 90.9 45.0 257.9 50.6 18.9 (206.1) $ 1.2 2.3 (6.1) 2.5 (12.2) (3.0) $ 58.8 92.1 47.3 251.8 53.1 6.7 (209.1) $ 10.6 164.7 268.1 12.2 1.7 (135.3) $ 0.6 0.7 2.7 (15.8) $ 10.6 164.7 268.7 12.9 4.4 (151.1) $ 69.4 256.8 316.0 251.8 66.0 11.1 (360.2) $ 316.0 $ (15.3) $ 300.7 $ 322.0 $ (11.8) $ 310.2 $ 610.9 Additional information on capital assets can be found in Note II-E starting on page 41. DEBT ADMINISTRATION At June 30, 2014, after scheduled debt payments, governmental activity debt decreased to $114.6 million while business activity debt decreased to $165.6 million. The state limits the amount a municipality may issue in general obligation debt to 20% of the City’s secondary assessed valuation for combined water, wastewater, artificial light, parks, open space preserves, playgrounds and recreational facilities. Debt related to other projects is limited to 6% of the valuation. The current debt limitation for the former type is $126.5 million. This City currently has no outstanding general obligation debt nor is there any debt outstanding for the other type of issuance. The City’s improvement district bonds were rated by Fitch Ratings as “A+”. All other bonds are rated “AA-”. The underlying ratings of Moody’s Investor Services and Standard and Poor’s are “Aa3” and “AA-“, respectively. With the exception of the improvement district bond, all City bond issues are insured, and while the city enjoys higher ratings, the guarantors can no longer provide “AAA” rating as a result of ratings downgrades of the insurance companies. A summary of the City’s long-term debt follows. Additional information on the City’s long-term debt can be found in Note II-G on pages 44-48. Summary of Long-Term Debt (Millions) Governmental activities Business-type activities 2013 2014 Yuma Municipal Property Corporation Bonds Net Unamortized Premium/Issuance Costs Improvement Districts Contracts Payable Compensated Absences Total Long-Term Debt $ $ 105.0 as restated* 2013 2014 112.2 $ 106.8 1.4 2.2 - 1.5 3.5 - 6.0 114.6 $ $ Total as restated* 2014 as restated* 110.3 $ 211.7 3.0 54.8 3.2 59.4 4.3 2.2 54.8 4.6 3.5 59.4 5.8 1.0 1.0 7.0 6.7 122.9 $ 165.6 173.9 $ 280.2 14 $ 2013 $ $ $ 222.5 296.8 MANAGEMENT’S DISCUSSION AND ANALYSIS ECONOMIC FACTORS Yuma County’s growth is sluggish but improving. The county grew by an estimated 4,040 residents to 200,870 with the City of Yuma representing 47.5% of the county’s population. Since 2000, the City has grown by 28% to an estimated 90,660 for Census 2010. (City-reported errors provided to the Census Bureau were finally recorded during fiscal year 2013 and 2014). The City’s economy is based on a triad of agriculture, tourism and military/government spending. Agribusiness continues to lead the economy, contributing well over $3 billion annually. The area’s 85,000-plus winter visitors add over $500 million to the mix, while two prominent military installations infuse some $300 million to the economy. Property taxes are limited constitutionally in Arizona, so other local revenues make up the most significant reflectors of the condition of the economy. Sales tax, the City’s primary source of general revenues, posted a 1.4% increase this year, compared to its historic growth rate of 7%. This still compares more than favorably to the large metropolitan areas of the state. For fiscal year 2015, General Fund revenues were projected with a 4.3% increase. With sales tax statistics improving, the economy continues to strengthen. economic events occurred: • • • During 2014, the following major The new F-35 Joint Strike Fighter began arriving in December 2012 and the new squadrons continue to grow. Additional construction projects necessitated by the new squadron continued into 2014. Yuma Regional Medical Center (YRMC) continues to expand its footprint and its services as new construction projects were completed. A new cancer center was completed in June followed by the opening of a new 3 level parking garage. In addition to the new cancer center, the hospital will be replacing its overburdened emergency room with a new, much-expanded facility. According to the Yuma Sun, “At $5.3 billion, - which is bigger than 40 countries – Yuma’s metropolitan area would rank 152 out of 195 countries.” Not all economic statistics reflect positive results; however, in that Yuma County continues to suffer what appear to be higher unemployment figures than most of the state, according to the Arizona Department of Economic Security (DES). Seasonal farm employment continues to skew this statistic. The City combats this problem as the largest contributor to the Greater Yuma Economic Development Corporation whose two-fold mission is to encourage new employers to the area and to assist local employers in their expansion efforts. CONTACTING THE CITY’S FINANCIAL MANAGEMENT This financial report is designed to familiarize our citizens, taxpayers and customers with the City’s finances and to demonstrate the City’s fiscal accountability for its operations. Questions concerning this report, or requests for additional financial information, should be directed to Mr. Donald (Pat) Wicks, Finance Director, One City Plaza, Yuma, AZ 85364, telephone (928) 373-5087. The reader may also visit the City’s website at www.yumaaz.gov for an electronic version of this report. 15 16 BASIC FINANCIAL STATEMENTS 17 18 GOVERNMENT-WIDE FINANCIAL STATEMENTS 19 City of Yuma, Arizona Statement of Net Position June 30, 2014 Assets Cash and Investments Receivables, Net Internal Balances Inventory, at cost Prepaid Items Capital Assets: Non-depreciable Depreciable, Net Total Assets Governmental Activities $ 70,981,488 12,633,534 881,366 668,315 838,060 Business-type Activities $ 68,939,924 7,907,934 (881,366) 292,831 41,105 Total $ 139,921,412 20,541,468 961,146 879,165 65,450,479 235,302,789 386,756,031 14,994,343 295,171,261 386,466,032 80,444,822 530,474,050 773,222,063 2,917,456 2,692,277 2,421,390 3,726,274 1,635,412 210,695 3,580,095 105,205 4,552,868 2,902,972 6,001,485 3,831,479 2,336,097 7,765,000 314,440 8,544,841 2,650,537 16,309,841 3,654,947 100,835,784 126,349,225 674,760 156,056,761 171,122,209 4,329,707 256,892,545 297,471,434 197,996,567 159,458,271 357,454,838 96,208 2,249,696 580,534 12,458,365 1,736,591 4,870,656 40,418,189 $ 260,406,806 9,009,138 46,876,414 $ 215,343,823 96,208 11,258,834 580,534 12,458,365 1,736,591 4,870,656 87,294,603 $ 475,750,629 Liabilities Accounts Payable and Deposits Accrued Liabilities Accrued Interest Payable Unearned Revenue Noncurrent Liabilities: Due within one year Current portion of Accrued Compensated Absences Current portion of Debt Due in more than one year Accrued Compensated Absences Debt Total Liabilities Net Position Net Investment in capital assets Restricted for: General government projects Debt Service Community Development Streets Public safety equipment and facilities Parks, recreation and cultural facilties Unrestricted Total Net Position The accompanying notes are an integral part of these financial statements. 20 City of Yuma, Arizona Statement of Activities For the Year Ended June 30, 2014 Functions/Programs Government Activities: General Government Public Safety Streets Parks, Recreation and Culture Environmental Health and Protection Community Design and Development Interest on Long-Term Debt Total Governmental Activities Business-type Activities: Water Wastewater Solid Waste Radio Communications Golf Courses Total Business-type Activities Total Charges for Services Expenses $ 10,335,500 46,584,692 25,264,719 13,605,827 89,483 5,166,707 4,780,812 $ 2,010,766 5,035,470 - Program Revenues Operating Capital Grants and Grants and Contributions Contributions $ 1,644,441 - $ 489,105 Net (Expense) Revenue and Changes in Net Assets Governmental Activities Business-type Activities $ $ (8,324,734) (39,904,781) (24,775,614) (8,324,734) (39,904,781) (24,775,614) 84,431 - - 257,356 64,489 232,362 - 232,362 1,318,614 23,675 (16,177) - (16,177) - (4,780,812) - (4,780,812) 577,269 (90,175,732) - (90,175,732) - 105,827,740 11,769,897 24,762,052 17,072,747 3,085,159 4,153,369 3,473,939 22,377,397 14,849,072 3,345,573 1,566,197 2,244,576 52,547,266 44,382,815 $ 158,375,006 $ 56,152,712 3,304,842 - 2,314,013 2,746,813 1,983,116 - - $ 7,043,942 3,304,842 General Revenues: Property taxes Sales taxes Franchise taxes Intergovernmental, unrestricted Unrestricted investment earnings Total general revenues Transfers Total general revenues and transfers Change in net position Net position-beginning, as restated Net position-ending The accompanying notes are an integral part of these financial statements. 21 $ 7,621,211 - - $ 915,420 3,808,241 (12,605,976) - Total (70,642) 523,138 260,414 (604,056) (1,229,363) (12,605,976) (70,642) 523,138 260,414 (604,056) (1,229,363) (1,120,509) (1,120,509) (90,175,732) (1,120,509) (91,296,241) 9,450,907 37,993,832 3,009,904 26,551,809 545,669 77,552,121 (730,234) 76,821,887 (13,353,845) 273,760,651 $ 260,406,806 222,384 222,384 730,234 952,618 (167,891) 215,511,714 $ 215,343,823 9,450,907 37,993,832 3,009,904 26,551,809 768,053 77,774,505 77,774,505 (13,521,736) 489,272,365 $ 475,750,629 22 FUND FINANCIAL STATEMENTS 23 City of Yuma, Arizona Balance Sheet Governmental Funds June 30, 2014 Assets City Road Tax General Cash and Investments $ 14,092,546 Cash with Fiscal Agents Receivables, Net of Allowances for Uncollectibles: Accounts Receivable 3,022,561 Intergovernmental 2,485,477 Special Assessments 20,169 Delinquent Property Taxes 360,361 Accrued Interest 8,057 Due from Other Funds 2,464,914 Inventory, at cost 37,819 Prepaid Items 140,072 $ 22,631,976 Total Assets and Other Debits $ $ Debt Service Other Nonmajor Governmental Funds Total 7,492,224 - $ 49,252 9,853,629 $ 21,121,761 - $ 42,755,783 9,853,629 33,580 594,458 3,236 2,379 8,125,877 8,183 2,245,000 22 $ 12,156,086 1,265,699 2,512,483 13,527 5,553 13,534 188 $ 24,932,745 4,330,023 5,592,418 2,265,169 373,888 16,868 2,464,914 51,353 142,639 $ 67,846,684 $ $ $ Liabilities Accounts Payable $ Accrued Payroll, Taxes and Benefits Payable Long-Term Debt - Current Portion Due to Other Funds Accrued Interest Payable Deposits Unearned Revenues Total Liabilities 814,905 1,035,548 423,081 13,863 2,287,397 Deferred Inflows of Resources Unavailable Revenues 2,434,816 Fund Balances: Nonspendable: Inventory Prepaid Items Restricted for: General government projects Debt Service Streets Public safety equipment and facilities Parks, recreation and cultural facilities Committed to: General government projects Streets Public safety equipment and facilities Parks, recreation and cultural facilities Sanitation facilities Public works projects Unassigned: Total Fund Balances Total Liabilities, Deferred Inflows of Resources and Fund Balance $ - 37,819 140,072 $ 51,353 142,639 4,696 - 96,208 4,650,540 1,736,591 4,870,656 96,208 4,696 12,458,365 1,736,591 4,870,656 7,810,204 4,696 2,845 3,279,444 1,232,387 1,868,923 378,910 255,964 18,386,190 2,845 3,279,444 1,232,387 1,868,923 378,910 255,964 17,731,872 44,110,853 8,125,877 $ 12,156,086 $ 24,932,745 $ 67,846,684 The accompanying notes are an integral part of these financial statements. 24 2,075,717 1,172,658 7,485,000 722,653 2,421,390 458,263 3,726,274 18,061,955 13,534 188 - 2,245,000 1,007,999 100,533 722,653 8,949 3,712,361 5,552,495 5,673,876 7,807,825 - 17,731,872 17,909,763 7,485,000 2,421,390 9,906,390 994,060 2,379 - $ 22,631,976 252,813 36,577 26,233 50 315,673 - City of Yuma, Arizona Reconciliation of the Balance Sheet-Governmental Funds to the Statement of Net Position June 30, 2014 Amounts reported for governmental activities in the statement of net position are different because: Total Fund Balances per the Balance Sheet-Governmental Funds: $ Capital assets used in governmental activities are not financial resources and, therefore, are not reported in the funds. Revenues deferred to later years recognized in year levied in governmental activities. Special Assessment/Loan Principal Property Tax Ambulance Billings 293,038,773 5,673,876 3,225,533 373,888 2,074,455 Long-term liabilities are not due and payable in the current period and therefore are not reported in the funds: Compensated absences MPC bonds payable Improvement District #68 Net unamortized deferred charges or premiums (5,901,379) (97,495,000) (2,245,000) are not recorded in the governmental funds (1,375,784) Net position of internal service funds that are used by management to charge the cost of equipment replacement and employee-related insurance to individual funds are included in governmental activities in the statement of net position Net position - Governmental Activities per the Statement of Net Position The accompanying notes are an integral part of these financial statements. 25 44,110,853 24,600,467 $ 260,406,806 City of Yuma, Arizona Statement of Revenues, Expenditures and Changes in Fund Balances Governmental Funds For the Year Ended June 30, 2014 City Road Tax General Revenues: Taxes Licenses and Permits Intergovernmental Charges for Services Fines and Forfeitures Special Assessments Use of Money and Property Contributions and Donations Miscellaneous Total Revenues Expenditures: Current: General Government Public Safety Streets Parks, Recreation and Culture Environmental Health and Protection Community Design and Development Capital Outlay Capital Projects: General Government Public Safety Streets Parks, Recreation and Culture Environmental Health and Safety Debt Service Principal Interest and Fiscal Agent Fees Total Expenditures Revenues Over/(Under) Expenditures Other Financing Sources/(Uses): Transfers In Transfers Out Total Other Financing Sources/(Uses) Net Change in Fund Balances Fund Balances - Beginning Fund Balances - Ending $ 32,109,065 1,880,101 20,299,664 4,302,462 1,209,502 325,628 274,943 $ 9,756,994 3,821 403,748 7,596 Debt Service Other Nonmajor Governmental Funds $ $ 8,558,852 9,954,208 2,780,193 109,742 88,347 173,395 $ 50,424,911 1,880,101 30,253,872 7,086,476 1,209,502 1,183,000 970,728 88,347 455,934 21,664,737 93,552,871 - 277,238 2,942,939 5,354,549 3,891,345 8,963,776 42,937,900 7,592,079 11,199,906 - - 72,459 72,459 65,891 - 1,599,911 750,573 5,095,847 1,009,661 - 598,479 65,113 160,052 - 866,260 1,679,268 1,906,470 2,243,660 172,911 866,260 1,679,268 2,504,949 2,308,773 332,963 - - 8,700,000 4,877,431 7,700 8,700,000 4,885,131 21,765,283 98,148,972 60,401,365 10,172,159 8,686,538 39,408,092 7,308,561 586,869 2,237,530 - 3,495,936 193,197 1,183,000 131,610 - Total Governmental Funds 1,314,610 59,092,324 3,713,934 13,577,431 1,309,041 6,458,225 (12,262,821) (100,546) (4,596,101) 1,043,982 (4,258,146) (3,214,164) (4,817,663) (4,817,663) 12,265,300 (540,898) 11,724,402 164,578 (4,587,387) (4,422,809) 13,473,860 (14,204,094) (730,234) (1,905,123) 1,640,562 (538,419) (4,523,355) (5,326,335) 19,814,886 6,169,642 543,115 22,909,545 49,437,188 4,696 $ 18,386,190 $ 44,110,853 $ 17,909,763 $ 7,810,204 The accompanying notes are an integral part of these financial statements. 26 $ City of Yuma, Arizona Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances-Governmental Funds to the Statement of Activities For the Year Ended June 30, 2014 Amounts reported for governmental activities in the statement of activities are different because: Net change in fund balances-governmental funds $ Portions of revenues recorded on the statement of activities do not provide current financial resources and are not recorded as revenues in the funds: Property taxes revenue Public safety ambulance revenue Loan Payments are recorded as revenues in the funds. In the statement of activities, however, these amounts are recorded as a reduction in receivables: Community Redevelopment Loan Payments Special Assessment Principal Payments Governmental funds report capital outlays as expenditures. In the statement of activities, however, the cost of those assets is allocated over their useful lives as depreciation Depreciation recorded in statement of activities Capital outlay expenditures reported as additions to assets: Capital outlay expenditures-governmental funds Infrastructure maintenance expenditures recorded as capital outlay but not capitalized as asset additions Governmental funds report debt principal service payments as expenditures. The reduction in liability is recorded on the statement of net position in the government-wide statements Increase in compensated absences expense not recorded in governmental funds The net effect of miscellaneous transactions involving capital assets (trades of land for rights-of-way) is to decrease net position. (5,326,335) (5,513) 634,994 (30,991) (1,183,000) (13,589,571) 8,701,874 (538,705) 8,700,000 (216,031) (10,656,059) Investment earnings of the internal service funds are general revenues on the statement of activities 84,910 Interest payments accrued in government-wide statements are not recorded in governmental activities until paid 104,319 Net revenues of internal service funds in excess of expenses reduce governmental activities expenses on the statement of activities Contributions of infrastructure assets are not recorded as revenues in the governmental funds Change in net position of governmental activities (149,351) 115,614 $ (13,353,845) The accompanying notes are an integral part of these financial statements. 27 City of Yuma, Arizona Statement of Net Position Proprietary Funds June 30, 2014 Assets Current Assets: Cash and Investments Receivables, Net of Allowance for Uncollectibles: Accounts Receivable Intergovernmental Accrued Interest Inventory, at cost Prepaid Expenses Total Unrestricted Current Assets Restricted Assets: Cash and Investments: Cash with Fiscal Agents Advancement for Future Expansion Customer Deposits Total Restricted Current Assets Total Current Assets Noncurrent Assets: Capital Assets: Land Buildings Improvements Other than Buildings Equipment Construction In Progress Less Accumulated Depreciation Total Capital Assets Total Noncurrent Assets Total Assets Liabilities Current Liabilities Payable from Current Assets: Accounts Payable Accrued Payroll and Related Taxes Current Portion-Long-Term Contracts-Principal Current Portion-Bonds Payable Current Portion-Accrued Compensated Absences Estimated Claims and Judgements Due to Other Funds Accrued Interest Payable Unearned Revenue Total Current Liabilities Payable from Current Assets Current Liabilities Payable from Restricted Assets: Accounts Payable Deposits Unearned Revenue Current Portion-Long-Term Contracts-Principal Current Portion-Long-Term Contracts-Interest Total Current Liabilities Payable from Restricted Assets Total Current Liabilities Noncurrent Liabilities: Long-Term Contracts Payable Bonds Payable Unamortized Premium/Insurance Costs Accrued Compensated Absences Total Noncurrent Liabilities Total Liabilities Net Position Net investment in capital assets Restricted for: Debt Service Unrestricted Total Net Position Water Fund Business-Type Activities-Enterprise Funds Wastewater Other Fund Funds $ 15,526,645 $ 16,607,841 $ 1,564,194 $ Totals 33,698,680 Governmental Activities Internal Service Funds $ 18,372,076 3,889,471 208,315 6,228 130,838 2,248 19,763,745 2,273,703 213,208 11,130 8,323 19,114,205 532,791 772,686 402 161,993 30,534 3,062,600 6,695,965 1,194,209 17,760 292,831 41,105 41,940,550 48,724 2 6,442 616,962 695,421 19,739,627 11,845,914 5,180,174 452,767 17,478,855 37,242,600 3,538,390 14,223,999 17,762,389 36,876,594 3,062,600 15,384,304 19,404,173 452,767 35,241,244 77,181,794 19,739,627 1,867,721 106,000,530 151,787,750 2,717,684 3,482,385 (84,031,728) 181,824,342 181,824,342 219,066,942 8,726,156 55,545,009 113,586,282 1,904,085 918,081 (56,408,326) 124,271,287 124,271,287 161,147,881 3,102,865 3,341,093 8,296,633 (10,670,616) 4,069,975 4,069,975 7,132,575 10,593,877 164,648,404 268,715,125 12,918,402 4,400,466 (151,110,670) 310,165,604 310,165,604 387,347,398 219,610 19,251 222,733 27,590,505 (20,337,604) 7,714,495 7,714,495 27,454,122 378,581 93,386 48,991 2,887,500 142,283 2,025,413 5,576,154 363,173 70,193 222,894 862,500 98,082 640,467 2,257,309 342,317 47,116 74,075 85,252 548,760 1,084,071 210,695 271,885 3,750,000 314,440 2,665,880 85,252 8,382,223 383,476 18,623 27,380 1,500,996 1,742,261 3,672,736 79,095 471,367 2,296,395 534,963 3,381,820 8,957,974 879 19,953 2,226,561 379,252 2,626,645 4,883,954 548,760 79,974 471,367 19,953 4,522,956 914,215 6,008,465 14,390,688 3,672,736 27,262,791 79,313,850 2,338,130 312,806 109,227,577 118,185,551 22,752,439 23,691,150 698,401 208,548 47,350,538 52,234,492 153,406 153,406 702,166 50,015,230 103,005,000 3,036,531 674,760 156,731,521 171,122,209 62,285 62,285 3,735,021 78,923,799 76,464,497 4,069,975 159,458,271 7,714,495 6,937,036 15,020,556 2,072,102 30,376,790 2,360,434 9,009,138 47,757,780 16,004,606 $ 100,881,391 $ 108,913,389 6,430,409 216,225,189 Adjustment to reflect consolidation of internal service fund activities related to enterprise funds Net position of business-type activities The accompanying notes are an integral part of these financial statements. $ (881,366) $ 215,343,823 28 $ 23,719,101 City of Yuma, Arizona Statement of Revenues, Expenses and Changes in Fund Net Position Proprietary Funds For the Year Ended June 30, 2014 Water Fund Operating Revenues: Metered Water Sales Commercial Raw Water Wastewater Charges Meters, Connections and Services Intergovernmental Charges for Services Green Fees and Concessions Equipment Rental Miscellaneous Charges Total Operating Revenues Operating Expenses: Operations and Maintenance Depreciation Total Operating Expenses Operating Income/(Loss) Non-Operating Revenues/(Expenses): Interest Gain/(Loss) on Disposal of Assets Interest and Fiscal Agent Fees Miscellaneous Revenues Total Non-Operating Revenues/(Expenses) Income/(Loss) before Contributions and Transfers Capital Contributions Transfers In Transfers Out Change in Net Position Net Position - Beginning, as restated Net Position - Ending $ Business-Type Activities-Enterprise Funds Wastewater Other Fund Funds 21,662,698 145,964 - $ 14,784,909 $ - Governmental Activities Internal Service Funds Totals $ 21,662,698 145,964 14,784,909 $ - 367,297 97,529 1,417 22,274,905 28,013 14,812,922 1,983,116 4,889,653 1,943,036 286,537 9,102,342 395,310 2,080,645 4,889,653 1,943,036 286,537 1,417 46,190,169 5,165,862 1,845,650 1,179,916 8,191,428 11,052,893 8,682,968 19,735,861 8,959,681 6,106,782 15,066,463 9,379,505 1,185,222 10,564,727 29,392,079 15,974,972 45,367,051 6,888,406 1,644,819 8,533,225 2,539,044 (253,541) (1,462,385) 76,153 (10,330) (4,995,861) 102,492 139,164 (3,790) (2,000,981) 36,150 7,066 (1,266) 37,120 222,383 (15,386) (6,996,842) 175,762 84,910 24,459 - (4,827,546) (1,829,457) 42,920 (6,614,083) 109,369 (2,288,502) (2,082,998) (1,419,465) (5,790,965) (232,428) 2,314,013 (62,466) 2,746,813 (31,927) 845,643 (21,016) 5,060,826 845,643 (115,409) - 631,888 (594,838) (36,955) 100,918,346 108,281,501 7,025,247 $ 100,881,391 $ 108,913,389 $ 6,430,409 Adjustment for consolidation of internal service fund activities related to enterprise funds Change in net position of business-type activities The accompanying notes are an integral part of these financial statements. 29 823,118 (341,797) 95 (232,428) 23,951,529 $ $ (167,987) (167,892) 23,719,101 City of Yuma, Arizona Statement of Cash Flows Proprietary Funds For the Year Ended June 30, 2014 Governmental Activities Business-Type Activities-Enterprise Funds Cash Flow from Operating Activities: Cash Received from Customers Cash Paid to Employees Cash Paid to Suppliers Cash Paid for Operating Expenses Other Operating Activity Revenue Net Cash Provided by Operating Activities Water Fund Wastewater Fund Other Funds Totals $ 23,390,388 (4,653,208) (6,086,612) 102,492 $ 15,550,769 (3,388,236) (5,360,896) 36,150 $ 9,599,460 (2,409,205) (7,047,075) 37,119 $ 48,540,617 (10,450,649) (18,494,583) 175,761 12,753,060 Cash Flows from Noncapital Financing Activities: Cash Received from Other Funds Cash Paid to Other Funds Net Cash Provided by/(Used for) Noncapital Financing Activities Cash Flow from Capital and Related Financing Acitivities: Contributions of Capital Acquisition and Construction of Assets Proceeds from Sale of Capital Assets Principal Payments on Bonds WIFA - Contracted Loan Interest and Fiscal Agent Fee Payments Net Cash (Used for) Capital and Related Financing Activities 6,837,787 180,299 Internal Service Funds $ 8,194,476 (1,060,829) (2,448,340) (2,336,144) - 19,771,146 2,349,163 (62,466) (31,927) 845,642 (21,016) 845,642 (115,409) (62,466) (31,927) 824,626 730,233 2,314,013 (3,652,524) (2,677,835) (2,345,386) (5,222,273) 2,746,813 (161,767) (824,550) (2,370,953) (2,095,524) (763,250) - 5,060,826 (4,577,541) (3,502,385) (4,716,339) (7,317,797) (2,429,188) 94,111 - (11,584,005) (2,705,981) (763,250) (15,053,236) (2,335,077) Cash Flows from Investing Activities: Receipt of Interest Net Cash Provided by Investing Activities 775,048 (1,113,364) (338,316) 76,245 76,245 141,544 141,544 7,765 7,765 225,554 225,554 1,182,834 4,241,423 249,440 5,673,697 31,822,666 30,128,807 1,314,754 63,266,227 18,608,337 Cash and Cash Equivalents, June 30 $ 33,005,500 $ 34,370,230 $ 1,564,194 $ 68,939,924 $ 18,372,076 Reconciliation of Operating Income/(Loss) to Net Cash Provided by Operating Activities: Operating Income/(Loss) $ 2,539,044 $ (253,541) $ (1,462,385) $ $ 6,106,782 726,615 (6,311) 192,254 1,185,222 488,291 4,593 (7,297) (110,424) Net Increase/(Decrease) in Cash and Cash Equivalents Cash and Cash Equivalents, July 1 Adjustments to Reconcile Operating Income/(Loss) Depreciation and Amortization Expense (Increase)/Decrease in Accounts Receivable (Increase)/Decrease in Inventories (Increase) in Deposits (Increase)/Decrease in Prepaid Items Increase/(Decrease) in Accounts Payable Increase/(Decrease) in Accrued Payroll and Related Taxes Increase/(Decrease) in Due from Other Gov't Units (Decrease) in Claims Incurred but Not Reported Increase/(Decrease) in Customer Dep/Unearned Rev Other Operating Activity Revenue Total Adjustments Net Cash Provided by Operating Activities Noncash Transactions Affecting Financial Position Purchase of Assets with Vendor Provided Financing Total Noncash Transactions Affecting Financial Position 8,682,968 1,076,203 86,676 2,400 7,056 172,237 823,118 87,969 87,969 (236,261) 15,974,972 2,291,109 91,269 2,400 (6,552) 254,067 (341,797) 1,644,819 489,100 127,164 (57,700) 25,741 48,644 35,340 102,492 10,214,016 $ 12,753,060 24,866 10,972 36,150 7,091,328 $ 6,837,787 36,353 745 8,082 37,119 1,642,684 $ 180,299 109,863 745 54,394 175,761 18,948,028 $ 19,771,146 (4,241) 466,077 2,690,960 $ 2,349,163 $ 75,842 $ - $ - $ 75,842 $ - $ 75,842 $ - $ - $ 75,842 $ - The accompanying notes are an integral part of these financial statements. 30 City of Yuma, Arizona NOTES TO THE FINANCIAL STATEMENTS For the Year Ended June 30, 2014 I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The City of Yuma (City) was incorporated April 14, 1914 under Arizona Revised Statute (A.R.S.) Title 9, Chapter 9, Section 101, and adopted its first charter on June 11, 1914. The City presently operates under a charter that was last amended on January 2, 2002. The Charter provides for a Council-Manager form of government and provides such services as are authorized by the Charter. Among these services are general government services, public safety (police and fire), parks, recreation, culture, streets, environmental health and protection, and community design and development. The accounting policies of the City conform to generally accepted accounting principles (GAAP) as applicable to governmental units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. With respect to proprietary activities, the City has adopted GASB Statement No. 62, Codification of Accounting and Financial Reporting Guidance Contained in Pre-November 30, 1989 FASB [Financial Accounting Standards Board] and AICPA Pronouncements. This statement incorporates into the GASB’s authoritative literature certain accounting and financial reporting guidance that was included in pronouncements issued by the FASB, by the Accounting Principles Board and by the American Institute of Certified Public Accountants (AICPA) on or before November 30, 1989. The following is a summary of the more significant policies. A. Reporting Entity The City is a municipal entity governed by an elected mayor and council. As required by generally accepted accounting principles, these financial statements present the City and its component units, entities for which the City is considered to be financially accountable. Blended component units, although legally separate entities, are, in substance, part of the City’s operations, and so data from these units are combined with data of the City, the primary government. The component units presented have a June 30 year-end. Blended Component Units Yuma Municipal Property Corporation. The Yuma Municipal Property Corporation's board members are appointed by the City Council. The Corporation was formed to finance the acquisition of certain improvements such as the Yuma Civic and Convention Center, Baseball Complex and Desert Hills Golf Course. The Corporation was also used to finance the acquisition of three public safety buildings (the police headquarters, a fire station and the Municipal Court facility) and Public Works facilities, along with a clubhouse for the municipal golf course and the new Municipal Complex. The Corporation conducts no business other than with the City and that business is solely the retirement of debt related to the aforementioned acquisitions. Complete financial statements may be obtained at the City of Yuma, City Clerk’s Office, One City Plaza, Yuma, AZ 85364. City of Yuma Employee Benefits Trust. The City of Yuma Employee Benefits Trust is responsible for providing health insurance for the City employees. The City Council appoints the Trust’s Board of Directors. The Trust provides services entirely to the City and therefore has been included as an Internal Service Fund as of June 30, 1997 in accordance with the criteria established in GASB Statement No. 14, The Financial Reporting Entity. Complete financial statements may be obtained at the City of Yuma Employee Benefit Trust’s administrative offices, One City Plaza, Yuma, AZ 85364. B. Accounting Pronouncements During the year ended June 30, 2014, the City implemented the provisions of GASB Statement No. 65, Items Previously Reported as Assets and Liabilities. GASB Statement No. 65 establishes accounting and financial reporting standards that reclassify, as deferred outflows of resources or deferred inflows of resources, certain items that were previously reported as assets and liabilities and recognizes, as outflows of resources or inflows of resources, certain items that were previously reported as assets and liabilities. GASB Statement No. 65 also clarifies that debt issuance costs, except any portion related to prepaid insurance costs, should be recognized as an expense in the period incurred. The City of Yuma has reclassified debt issuance costs and restated the prior year. See note II-L for the restatement of Net Position. 31 City of Yuma, Arizona NOTES TO THE FINANCIAL STATEMENTS For the Year Ended June 30, 2014 C. Accounting Pronouncements Issued But Not Yet Adopted GASB Statement No. 68, Accounting and Financial Reporting for Pensions, issued June 2012, will be effective for the City of Yuma beginning with its fiscal year ending June 30, 2015. This statement replaces the requirements of GASB Statement No. 27, Accounting for Pensions by State and Local Governmental Employers, and GASB Statement No. 50, Pension Disclosures, as they relate to governments that provide pensions through pension plans administered as trusts or similar arrangements that meet certain criteria. This statement requires governments providing defined benefit pensions to recognize their long-term obligation for pension benefits as a liability for the first time, and to more comprehensively and comparably measure the annual costs of pension benefits. This statement is intended to enhance accountability and transparency through revised and new note disclosures and required supplementary information. The City’s management has not yet determined the effect this statement will have on the financial statements. D. Government-wide and fund financial statements The government-wide financial statements report financial information on all the activities of the City of Yuma and its component units. These financial statements include the Statement of Net Position and the Statement of Activities, a statement showing changes in net position. Most interfund activities have been removed from these statements to avoid duplicating the information, with some exceptions such as proprietary fund sales to governmental funds (i.e., water bills paid by a governmental fund). Eliminating these transactions would distort both the measurement of income generated in serving proprietary customers as well as the direct cost of governmental functions serving the citizenry. In these government-wide statements, governmental activities, normally supported by taxes and intergovernmental revenues, are separated from business-type activities that rely on fees and charges for services. The statement of activities presents direct expenses of a given function or segment and the degree to which these expenses are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include 1) charges to customers who use or directly benefit from the services of the function; and 2) grants and contributions that are restricted to the operational or capital needs of a particular function. Taxes and other revenues that are identifiable with a particular function or segment are reported as general revenues. In addition to government-wide presentations, fund financial statements are provided for all governmental and proprietary funds. The financial statements are segregated by their respective significance to City operations with individual major governmental and proprietary funds separated from nonmajor funds (aggregate nonmajor financial activity is reported as a column on the major funds presentation for both governmental and proprietary funds). The City uses GASB Statement No. 34 to determine which funds are to be presented as major funds. In addition to those minimum requirements, the City will, from time to time, include within its major funds presentations of other funds, that because of their significance, preclude aggregate reporting outside the basic financial statements. The City of Yuma reports the following funds: GOVERNMENTAL FUNDS General Fund – The General Fund is the general operating fund of the City. It is used to account for all financial resources except those for which another fund is required or used. City Road Tax Fund – This fund accounts for the collection and expenditure of a local one-half percent transaction privilege tax approved by voters in 1994 for maintenance and construction of roadways. Debt Service Fund – This fund accounts for and reports financial resources for the payment of long-term debt principal, interest, and related costs of the City of Yuma Municipal Property Corporation, a blended component unit, and Special Assessment Improvement Districts. Pledged excise tax and other revenues are transferred to this fund along with property owner’s revenue for payments of long-term bonded debt. 32 City of Yuma, Arizona NOTES TO THE FINANCIAL STATEMENTS For the Year Ended June 30, 2014 Other Nonmajor Governmental Funds – Other nonmajor governmental funds of the City of Yuma are aggregated and are presented in a combining statement in the Other Supplementary Information section. These include the Highway Users Revenue, Grants, Community Redevelopment, Local Transportation Assistance, Public Safety Tax, Two Percent Tax, and Yuma Mall Maintenance Special Revenue Funds along with the Capital Projects Funds. PROPRIETARY FUNDS Water Fund – The operations of the City’s drinking water treatment and distribution system are accounted for in this enterprise fund. Wastewater Fund – This enterprise fund accounts for the City’s wastewater collection and treatment system. Other Nonmajor Enterprise Funds – Other nonmajor enterprise funds of the City of Yuma are aggregated along with the major enterprise funds and are also presented in a combining statement in the Other Supplementary Information section. These funds include the Solid Waste, Radio Communications, and Desert Hills Golf Course Funds. Internal Service Funds – Internal Service Funds are used to account for the financing of goods or services provided by one department or agency to other departments or agencies of the City on a cost-reimbursement basis. They are also presented in the aggregate with major enterprise funds and are included in a combining internal service fund presentation in the Other Supplementary Information section. Because they service primarily governmental funds, they are not included within the business-type activities of the Statement of Net Position. Rather, they are combined with the governmental activities on that statement. Moreover, because of their essentially duplicative nature in accounting for their operations (revenues of the internal service funds are expenses of the operating funds), the operations of the internal service funds have been eliminated from the operations of the Statement of Activities. Internal service funds include the Equipment Replacement, Equipment Maintenance, Insurance Reserve, Workers Compensation and Employee Benefits Trust Funds. E. Measurement focus and basis of accounting The government-wide financial statements, as well as the proprietary fund financial statements, use the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when the liability is incurred. Property taxes are recognized as revenue in the year levied. Grants are recognized as revenue when all eligibility requirements are met and the underlying expenses have been recorded. Governmental fund financial statements are presented using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period (within 60 days). Grant revenues are recognized when all eligibility requirements are met, not necessarily when received. Grant monies that have been received but are as yet unearned are carried forward as unearned revenue. However, earned but not yet received grant monies are recognized as revenue and carried forward as receivables. This practice is defined and supported by GASB Statement 33, as it pertains to “government-mandated nonexchange transactions,” paragraphs 19-25. Expenditures are recorded when the liability is incurred with the exception of debt service. Debt service expenditures are recorded when the payment is due or when amounts have been accumulated in the debt service fund for payments to be made early in the following year. Property taxes, along with franchise taxes, licenses and sales taxes are susceptible to accrual and have been recognized as revenues of the current period. Delinquent property taxes and property taxes for which there is an enforceable legal claim as of the fiscal year, but which were levied to finance operations of the subsequent fiscal year, have been recorded as unavailable revenue. Grants and similar awards received before the eligibility requirements are met are recorded as unearned revenue. Receivables that will not be collected within the available period have also been reported as unavailable revenue on the governmental fund financial statements. All other revenue items are considered measurable and available only when cash is received. 33 City of Yuma, Arizona NOTES TO THE FINANCIAL STATEMENTS For the Year Ended June 30, 2014 Proprietary funds classify revenues and expenses as operating or nonoperating items. Operating revenues and expenses relate to the fund’s ongoing operations in providing goods and services. Operating revenues for the City’s proprietary funds are customer charges for sales and services. Operating expenses include the cost of sales or services, administrative expenses and depreciation. All other revenues and expenses are classified as nonoperating revenues and expenses. F. Budget Information 1) The City follows these procedures in establishing the budgetary data reflected in the financial statements: i. On or before the first Monday in June, the City Administrator submits to the City Council a proposed operating budget for the fiscal year commencing the following July 1. The operating budget includes proposed expenditures and the means of financing them. ii. Two public hearings are held prior to the budget's final adoption in order to obtain taxpayer comments. iii. On or before the third Monday in August, the budget is legally enacted through passage of an ordinance. iv. At any time during the fiscal year, the City Administrator may transfer part or all of any unencumbered appropriation balance among programs within a fund. Upon written request by the City Administrator, the Council may, by ordinance, transfer part or all of any unencumbered appropriation balance from one fund to another. v. Formal budgetary integration is employed as a management control device during the fiscal year for all funds with legally adopted budgets (only the Workers Compensation and Employee Benefits Trust Internal Service Funds are not budgeted). Appropriations not expended at fiscal year end lapse. vi. Budgetary amounts include those as originally adopted, and as amended by Council or City Administrator through the end of the fiscal year. Arizona State Statute does not allow supplemental budgets. vii. Expenditures incurred during the fiscal year may not legally exceed the publicly published budget. The maximum legal expenditure permitted for the fiscal year is the total adopted budget. 2) Budgetary Reporting and Budgetary Basis of Accounting: The City has opted to display budgetary information schedules in a manner similar to its adopted budget; therefore, the information is displayed outside its basic financial statements. Budgetary comparisons are presented for the General Fund and the major Special Revenue Funds in the Required Supplementary Information section. Budgetary comparisons for the Debt Service Fund, the Capital Projects Fund, the nonmajor governmental funds and the proprietary funds are presented in the Other Supplementary Information sections. For proprietary funds, the budgetary comparison includes reconciliation to the accrual-based operating statements. G. Assets, Liabilities and Fund Equity Disclosures 1) Transactions between Funds: Interfund transactions consisting of identified services performed for other funds or costs billed to other funds are treated as expenditures in the fund receiving the services and as a reimbursement reducing expenditures in the fund performing the services. Exceptions to this include: (1) sales of water and wastewater treatment are treated as revenue by the Enterprise Fund, radio and software annual maintenance fees are treated as revenue by the Enterprise Fund and expenses in the governmental funds, and in-lieu property taxes are recorded as revenues in the General Fund and expenses in the Enterprise Funds; (2) transfers are made in certain other funds to shift resources from a fund legally required to receive revenue to a fund authorized to expend the revenue; and (3) charges for services of the Internal Service Funds are recorded as expenditures in the funds receiving the service. For purposes of government-wide presentation, these latter transactions are eliminated. 34 City of Yuma, Arizona NOTES TO THE FINANCIAL STATEMENTS For the Year Ended June 30, 2014 2) Cash and Investments: Cash balances of the City’s funds are pooled and invested by the City. The policy of the City is to invest public funds in a manner which provides the maximum security of principal invested, conforms to all applicable State statutes and City ordinances, delivers the highest yield, and meets the City’s daily cash flows. Income earned or loss arising from the investment of the pooled cash is allocated on a monthly basis to the individual funds based upon average daily balance. The City considers short-term investments (including restricted assets) in the State of Arizona Local Government Investment Pool (LGIP), mutual fund-money market, U.S. Treasury bills and notes with original maturities of three months or less at acquisition date to be cash equivalents. In accordance with GASB Statement No. 31, Accounting and Financial Reporting for Certain Investments and for External Investment Pools, the City reports its investments at fair value based on quoted market information obtained from fiscal agents or other sources. 3) Inventories and Prepaid Items: Inventories consist primarily of expendable supplies held for consumption. Prepaid items represent services for which payment is made in advance. Both inventories and prepaid items are accounted for using the consumption method; therefore, expenditures are recorded at the time inventories are used or the services incurred. Inventories are maintained on a perpetual inventory basis, verified through annual physical counts, and valued using the weighted average method. Nonspendable governmental fund balance for both inventories and prepaid items indicate that a portion of fund balance is not available for future expenditures. 4) Grants Revenue: The City follows the policy that, grants and similar items are recognized as revenue or contributed revenue as soon as all eligibility requirements imposed by the provider have been met. 5) Unbilled Accounts Receivable: The City records as receivables and as revenues the amount of water sales, sewer service charges and commercial refuse collection charges accrued but unbilled at fiscal year end. At June 30, 2014, the estimated amounts of unbilled revenues for the Water, Wastewater and Solid Waste Enterprise Funds are $2,305,228, $1,317,057, and $295,748, respectively. 6) Capital Assets: Capital assets are reported in the applicable governmental or business-type activities columns in the government-wide financial statements. Capital assets include property, plant, equipment and infrastructure (e.g., roads, bridges and similar items) and are defined as assets with an individual cost of more than $5,000 and a useful life exceeding one year. These assets are valued at cost or estimated historical cost if original cost is not available. Gifts or contributions are stated at fair market value at the date received. Depreciation and amortization have been provided over the estimated useful lives using the group life method on a straightline basis and the following useful lives: Buildings Improvements 33 to 100 years 20 to 50 years Infrastructure Equipment 35 years 2 to 50 years For proprietary fund assets constructed with bond proceeds, interest costs have been capitalized, net of interest revenue. Gains or losses are recognized when assets are retired from service or are otherwise disposed. 7) Contributions: Contributions, as shown in the Enterprise Funds, represent sub-dividers' costs of installing water and sewer mains, water service connections installed at the customers' expense, transfers of equipment from other City funds, and contributions from customers to defray future expansion costs. 35 City of Yuma, Arizona NOTES TO THE FINANCIAL STATEMENTS For the Year Ended June 30, 2014 8) Long-term obligations: In the government-wide financial statements, and proprietary fund types in the fund financial statements, longterm 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 position. Bond premiums and discounts, as well as insurance premiums, are amortized over the life of the bonds using the straight-line method. Bonds payable are reported net of the applicable bond premium or bond discount. Bond insurance premium costs are reported as unamortized discounts and amortized over the life of the debt. In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond issuance costs, during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures. 9) Fund Balance Policies: In the fund financial statements, fund balance is reported in classifications that comprise a hierarchy based on the extent to which the City is bound to honor constraints on the specific purposes for which amounts in those funds can be spent. The classifications of fund balance are Nonspendable, Restricted, Committed, Assigned, and Unassigned. Nonspendable and Restricted fund balances represent the restricted classifications and Committed, Assigned, and Unassigned represent the unrestricted classifications. Nonspendable fund balance includes amounts that cannot be spent because either 1) it is not in a spendable form, such as inventory or prepaid items or 2) it is legally or contractually required to be maintained intact. Restricted fund balance is comprised of externally (outside the City) enforceable limitations imposed by creditors, grantors, contributors, laws and regulations of other governments, or laws through constitutional provisions or enabling legislation (changes in City Charter). Committed fund balance includes self-imposed limitations adopted at the highest level of decision making authority, namely, City Council. City Council approval, through adoption of an ordinance, is required to commit resources or to rescind the commitment. Assigned fund balance represents limitations imposed by management. Assigned fund balance items are submitted by the Finance Director for approval/nonapproval by the City Administrator. Unassigned fund balance represents the residual net resources in excess of the other classifications. The General Fund is the only fund that can report a positive unassigned fund balance and any governmental fund can report a negative unassigned fund balance. When both restricted and unrestricted resources are available for specific expenditures, unrestricted resources are considered spent before restricted resources. Within unrestricted resources, committed and assigned are considered spent (if available) before unassigned amounts. H. Revenues, Expenditures, Expenses and Other Disclosures 1) Property Tax Revenue Recognition: Yuma County is responsible for billing and collecting property taxes. Collections by the County in one month are remitted to the City in the next month. For government-wide presentation, revenues equal the taxes levied for the fiscal year. No allowance for uncollectible taxes has been recorded as the City’s experience shows that after five years the amount uncollected represents less than one-half percent of the original levy. For governmental fund statement purposes, revenues are recorded as received, with the exception of taxes collected within 60 days by the County Treasurer and reported as current year revenues (County Treasurer collections for June of the current fiscal year). Delinquent property taxes (collections of noncurrent years) are recorded similarly. The balance of delinquent taxes is recorded in the property tax receivable account with a corresponding entry to the unavailable revenue account. 36 City of Yuma, Arizona NOTES TO THE FINANCIAL STATEMENTS For the Year Ended June 30, 2014 2) Compensated Absences: The City's administrative regulations provide permanent City employees with general and major illness leave in varying amounts based on years of service. In addition, employees may accrue hours worked on holidays for absences or payment in the future. General leave vests with the employee as it is earned. General and holiday leave with related benefits for the governmental funds, $5,048,519, and for the internal service funds, $69,088, are recorded in the governmental activities column of the government-wide financial statements. The amounts of general and holiday leave pay and related benefits attributable to the Water, Wastewater, Solid Waste, Radio Communications, and Desert Hills Enterprise Funds are $368,203, $247,181, $75,980, $37,418 and $74,038, respectively, and are recorded in those funds and in the business-type activities of the government-wide statements and accrued as earned. Major illness leave benefits provided for ordinary sick pay are not vested with the employee. Unused benefits are payable only upon the death or retirement of the employee. At June 30, 2014, the amount accumulated in sick pay and related benefits is $7,827,505, including $103,459 attributable to Internal Service Funds and $1,331,609 to Enterprise Funds. Under GASB Statement No. 16, Accounting for Compensated Absences, the City uses the “termination payment” method to determine its provision for major illness leave liability. The portion of the major illness leave liability related to governmental fund types, $852,859, is reported within the governmental activities column of the government-wide financial statements, as current amounts of that liability have been determined to be immaterial and are not recorded within the respective governmental funds. The provision for probable future major illness leave and related benefits attributable to the Equipment Maintenance and Insurance Reserve Internal Service Funds is $18,781 and $1,797, respectively, and Water, Wastewater, Solid Waste, Radio Communications, and Desert Hills Golf Course Enterprise Funds of $86,886, $59,449, $16,005, $5,704 and $18,336, respectively, are recorded in those funds and are accrued as earned. I. Investment Income Investment income is composed of interest and net changes in the fair value of applicable investments. J. Use of Estimates The preparation of financial statements, in conformity with accounting principles generally accepted in the United States of America, requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. II. DETAIL NOTES ON ALL FUNDS A. Cash and Investments The City maintains a cash and investments pool that is available to all funds. Each fund’s portion of the cash and investment pool is shown in the accompanying balance sheet as “Cash and Investments”, including the portion listed under “Restricted Assets”. The City also records cash and investments, held by fiscal agents, which are restricted by bond indenture requirements for the payment of principal and interest at the end of the fiscal year. Deposits At June 30, 2014, the City’s deposits had a carrying value of $8,401,779 and a bank balance of $9,404,271. The difference represents outstanding checks and other reconciling items. The main City checking account is fully collateralized and is disclosed with investments. All pledged bank collateral for demand deposits are held by an independent institution outside the bank’s holding company. Custodial Credit Risk The custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, the City’s deposits may not be covered. The City requires all demand deposits be covered by federal depository 37 City of Yuma, Arizona NOTES TO THE FINANCIAL STATEMENTS For the Year Ended June 30, 2014 insurance or by pledged collateral held by the financial institution’s trust department in the name of the City at 102% of market value. At June 30, 2014, there are no deposits exposed to custodial credit risk. Cash on hand at June 30, 2014, included petty cash and change funds balances of $28,251 which are included as money market funds below. Investments The City adheres to State Law and its adopted Investment Policy to invest public funds in a manner which will provide the maximum security of principal invested while providing the highest yield which will also meet the daily cash flow needs of the City. Per GASB Statement No. 31, Accounting and Financial Reporting for Certain Investments and for External Investment Pools, the City reports certain money market investments with a remaining maturity of one year or less at time of purchase at amortized cost instead of fair value. The difference between the fair value and amortized value for June 30, 2014, is $25. The City’s investment balances at June 30, 2014, were as follows: Investment Type US Treasury Notes/Bills Commercial Paper US Agencies: Federal Farm Credit Bank Federal Home Loan Bank Federal Home Loan Mtg. Corp. Federal National Mtg. Assoc. Money Market Funds Wells Fargo-Bus Market Fund State Investment Pool 5 Total Value Fair Value Investment Maturities in Years 5,001,406 11,047,241 < 1 Year $ 3,001,016 11,047,241 1-2 Years $ 2,000,390 - $ 2,003,630 14,008,818 14,004,932 12,997,472 39,431,822 15,122,353 17,873,734 $ 131,491,409 6,006,674 4,004,030 5,008,240 39,431,822 15,122,353 17,873,734 $ 101,495,110 2,003,630 2,000,676 4,003,298 1,999,062 $ 12,007,056 4,000,690 5,997,604 3,995,538 $ 13,993,832 $ 2-3 Years - $ $ 3-5 Years 2,000,778 1,994,632 3,995,410 Credit Risk Credit risk is the risk that an issuer or other counterparty to an investment will not fulfill its obligations. The City’s investment policy reduces exposure to investment credit risk by limiting authorized securities to the following: 1. Obligations of the United States Government, its agencies and instrumentalities, excluding mortgagebacked securities; 2. Fully insured or collateralized certificates of deposit and other evidence of deposit at banks and savings and loan associations; 3. Bankers acceptances issued by the ten largest domestic banks; 4. Commercial paper rated A-1/P-1; 5. Repurchase agreements whose underlying collateral consists of the foregoing, provided a signed PSA Master Repurchase Agreement is on file with the counter party bank or broker/dealer; 6. Money Market Funds whose portfolio consists of the foregoing; 7. The State of Arizona Local Government Investment Pool. At June 30, 2014, all investments, with the exception of the State Investment Pool, are rated AAA or A-1 by Standard and Poor’s and Aaa or P-1 by Moody’s. The State Investment Pool 5 was rated AAA/s1+ by Standard and Poor’s at year end. Concentration of Credit Risk Concentration of credit risk is the risk of loss attributed to the magnitude of a government’s investments in a single issuer. The City reduces this risk by diversifying its investment portfolio. Diversification strategies are established and monitored on a monthly basis. The allowed diversification standard and actual percentage at year end by security type and issuer are as follows: 38 City of Yuma, Arizona NOTES TO THE FINANCIAL STATEMENTS For the Year Ended June 30, 2014 Maximum % U. S. Treasuries and securities having principal and interest guaranteed by the U.S. Government .......................................................................................... 100% U. S. Government agencies, instrumentalities and government sponsored enterprises ....................................................................... No more than 80% Fully insured or collateralized CD’s ........................................................ No more than 30% Banker’s Acceptances ............................................................................ No more than 25% A-1/P-1 Commercial Paper ..................................................................... No more than 35% Maximum per issuer........................................................................... 10% of total C. P Repurchase Agreements .............................................................................................. 100% Money Market Funds .................................................................................................... 100% State Investment Pool .................................................................................................. 100% Actual % 3.80% 32.71% 0% 0% 8.40% 0% 0% 41.49% 13.60% Interest Rate Risk Interest Rate risk is the risk that changes in interest rates will adversely affect the fair value of an investment. In accordance with State law and its investment policy, the City sets a maximum maturity on any investment of five years. Unless matched to a specific requirement, no more than 25% of the portfolio may have maturities greater than three years. There are no investments with maturities greater than five years, and there are no holdings with a stated maturity beyond five years. The portfolio at June 30, 2014, had a weighted average maturity of 425 days. The policy does not set a maximum for this measurement. Custodial Credit Risk The custodial credit risk for investments is the risk that in the event of the failure of the counterparty to a transaction, the City will not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. The City reduces exposure to custodial credit risk in its safekeeping and collateralization policies. All security transactions are conducted on a delivery versus payment basis and are held by a third party custodian, in the City of Yuma’s name. The custodian is required to issue a safekeeping receipt listing the specific instrument, rate, and maturity. Although there were no certificate of deposit or repurchase agreements at June 30, the collateralization level of at least 102% of market value is required for these securities. B. Property Tax The City's property tax is levied by the Yuma County Treasurer on or before the third Monday in August based upon the previous January 1 full cash value as determined by the Yuma County Assessor. Under Arizona law, two assessed valuations are used. One is for primary taxes (used to fund operating expenditures) and the other is for secondary taxes (used to meet general obligation debt service requirements). The primary tax levy is limited to a two percent increase over the previous year with adjustments for growth and annexation. Secondary taxes are tied to the annual debt service requirements of voter-approved general obligation bonds. Taxes are due in two equal installments on October 1 and March 1 following the levy date and are delinquent on the first day of November and May, respectively. Liens are filed when taxes are delinquent for two years. Assessed values, levies and collections for fiscal year 2012-13 (Tax Year 2012) and fiscal year 2013-14 (Tax Year 2013), follow: Tax Year 2012 Primary Assessed Valuation Primary Tax Rate Primary Tax Levy Secondary Assessed Valuation Secondary Tax Rate/Levy Current Tax Collections Delinquent Tax Collections Delinquent Taxes Outstanding as of June 30 39 $ $ $ $ $ $ 602,696,459 1.5787 9,514,752 625,801,724 None 9,143,721 351,550 375,542 Tax Year 2013 $ $ $ $ $ $ 547,206,239 1.9962 10,923,330 632,734,838 None 9,107,069 232,787 360,361 City of Yuma, Arizona NOTES TO THE FINANCIAL STATEMENTS For the Year Ended June 30, 2014 C. Accounts Receivable Receivable balances are stated net of an allowance for doubtful accounts. Within the Solid Waste Enterprise Fund, an allowance account is established to record the estimated uncollectible refuse collection billings. Within the Water and Wastewater Enterprise Funds, allowance accounts have been established to record estimated uncollectible water and wastewater billings. No allowance account has been made for other types of receivables. The balances of these accounts are as follows: Intergovernmental Accounts General City Road Tax Debt Service Water Wastewater Other Funds-Governmental Other Funds-Enterprise Internal Service Total Delinquent Property Taxes Special Assessment Accrued Interest 3,022,561 33,580 8,183 3,889,471 2,273,703 1,265,699 532,791 48,724 $ 2,485,477 594,458 208,315 213,208 2,512,483 772,686 2 $ 20,169 2,245,000 - $ 360,361 13,527 - $ $ 11,074,712 $ 6,786,629 $ 2,265,169 $ 373,888 $ 41,070 $ 8,057 3,236 22 6,228 11,130 5,553 402 6,442 Total $ 5,896,625 631,274 2,253,205 4,104,014 2,498,041 3,797,262 1,305,879 55,168 $ 20,541,468 Allowance Amount 2013 2014 Enterprise Funds: Solid Waste Water Wastewater $ 8,642 117,379 71,010 $ 16,153 197,833 120,823 D. Due from Other Governments (Intergovernmental Receivables) Amounts due from other government units at June 30, 2014, are as follows: Agencies Federal Governmental Funds Major Funds General City Road Tax Non-major Funds Highway User Revenue Public Safety Tax Mall Maintenance Grants Community Redevelopment Capital Projects Enterprise Funds: Major Funds Water Wastewater Non-major Funds Solid Waste Radio Communications Desert Hills Golf Course Internal Service Funds Equipment Maintenance Total $ State County Local Total $ 1,988,765 594,458 $ 218,306 - $ 278,406 - $ 2,485,477 594,458 579,655 418,359 - 575,014 237,702 15,280 308,846 16,991 7,966 - 352,670 592,005 237,702 7,966 594,935 418,359 661,516 207,623 126,321 692 52,731 - 34,156 208,315 213,208 740,386 - 1,148 15 438 400 - 30,299 - 1,148 771,100 438 - $ 2,072,344 2 $ 3,775,091 40 $ 243,663 $ 695,531 2 $ 6,786,629 City of Yuma, Arizona NOTES TO THE FINANCIAL STATEMENTS For the Year Ended June 30, 2014 E. Capital Assets Capital asset activity for governmental activities for the year ended June 30, 2014, follows: Balance June 30, 2013 Increases Decreases Capital Assets Not Being Depreciated: Land Construction in Progress Total Capital Assets Not Being Depreciated Other Capital Assets: Buildings Improvements Infrastructure Equipment Total Other Capital Assets Less Accumulated Depreciation for: Buildings Improvements Infrastructure Equipment Total Accumulated Depreciation Other Capital Assets, Net Total Capital Assets, Governmental Activities $ 58,765,206 18,942,714 $ 2,827 3,018,786 $ 15,279,054 Balance June 30, 2014 $ 58,768,033 6,682,446 77,707,920 3,021,613 15,279,054 65,450,479 90,921,878 45,020,687 257,932,660 50,536,566 1,214,042 2,308,773 7,171,252 6,720,054 27,152 13,305,216 4,094,575 444,411,791 17,414,121 17,426,943 92,108,768 47,329,460 251,798,696 53,162,045 444,398,969 31,506,685 31,539,516 103,987,614 39,103,528 206,137,343 2,968,372 2,772,238 6,420,573 3,073,208 15,234,391 9,108,107 3,167,447 12,275,554 34,475,057 34,311,754 101,300,080 39,009,289 209,096,180 238,274,448 2,179,730 5,151,389 235,302,789 5,201,343 $ 20,430,443 $ 300,753,268 $ 315,982,368 $ Government activities capital assets net of accumulated depreciation at June 30, 2014, include: General Capital Assets, Net Internal Service Fund Capital Assets, Net Total $ 293,038,773 7,714,495 $ 300,753,268 Depreciation was charged to governmental functions as follows: General Government Public Safety Parks, Recreation, and Culture Environmental Health and Protection Community Design and Development Streets Assets held by Internal Service Funds are charged based on usage of assets $ 1,424,641 3,266,037 2,373,493 28,304 54,779 6,535,964 1,551,173 Total $ 41 15,234,391 City of Yuma, Arizona NOTES TO THE FINANCIAL STATEMENTS For the Year Ended June 30, 2014 Business-type activities: Balance June 30, 2013 Capital Assets Not Being Depreciated: Land Construction in Progress Total Capital Assets Not Being Depreciated $ 10,593,877 1,721,752 12,315,629 Increases $ 2,678,714 2,678,714 Decreases $ - Balance June 30, 2014 $ 10,593,877 4,400,466 14,994,343 Other Capital Assets: Buildings Improvements Equipment 164,648,404 268,154,479 12,202,282 560,647 933,210 217,091 164,648,404 268,715,126 12,918,401 Total Other Capital Assets 445,005,165 1,493,857 217,091 446,281,931 Less Accumulated Depreciation for: Buildings Improvements Equipment Total Accumulated Depreciation 11,525,841 114,783,538 9,028,023 3,301,159 11,483,580 1,190,234 201,705 14,827,000 126,267,118 10,016,552 135,337,402 15,974,973 201,705 151,110,670 Other Capital Assets, Net 309,667,763 (14,481,116) 15,386 295,171,261 $ 321,983,392 $ (11,802,402) 15,386 $ 310,165,604 Total Capital Assets, Business-type activities $ Depreciation was charged to programs as follows: Water Wastewater Solid Waste Radio Communications Golf courses Total $ 8,682,969 6,106,782 32,016 975,973 177,233 $ 15,974,973 Construction in progress is comprised mainly of water projects (waterline replacements and water transmission lines) and wastewater projects (wastewater treatment plant upgrades and improvements, and collection facilities). Impaired Capital Assets A number of capital improvement projects under design or limited construction were cancelled during the year. Accordingly, the assets previously recorded as Construction in Progress were written down and recorded as Streets program expenses through the Statement of Activities – Governmental Activities. For the fiscal year, these asset adjustments amounted to $7,614,364. F. Retirement Plans The City has adopted GASB Statement No. 27, Accounting for Pensions by State and Local Governmental Employers as amended by GASB Statement No. 50, Pension Disclosures, which requires the following disclosures. Plan Descriptions - The City contributes to the three plans described below. Benefits are established by state statute and generally provide retirement, death, long-term disability, survivor and health insurance premium benefits. The Arizona State Retirement System (ASRS) administers a cost-sharing multiple-employer defined benefit pension plan that covers general employees of the City. The ASRS is governed by the Arizona State Retirement System Board according to the provisions of A.R.S. Title 38, Chapter 5, Article 2. 42 City of Yuma, Arizona NOTES TO THE FINANCIAL STATEMENTS For the Year Ended June 30, 2014 The Public Safety Personnel Retirement System (PSPRS) is an agent multiple-employer defined benefit pension plan that covers public safety personnel who are regularly assigned hazardous duty as employees of the State of Arizona or one of its political subdivisions. The PSPRS, acting as a common investment and administrative agent, is governed by a five-member board, known as The Fund Manager, and 167 local boards, according to the provisions of A.R.S. Title 38, Chapter 5, Article 4. The Elected Officials Retirement Plan (EORP) is a cost-sharing multiple-employer defined benefit pension plan that covers elected officials and judges of certain state and local governments. The EORP is governed by The Fund Manager of PSPRS according to the provisions of A.R.S. Title 38, Chapter 5, Article 3. Each plan issues a publicly available financial report that includes its financial statements and required supplementary information. A report may be obtained by writing or calling the applicable plan. ASRS PSPRS and EORP 3300 North Central Avenue 3010 E Camelback Rd., Ste 200 P.O. Box 33910 Phoenix, AZ 85016 Phoenix, AZ 85067-3910 (602) 240-2200 or (800) 621-3778 (602) 255-5575 Funding Policy - The Arizona State Legislature establishes and may amend active plan members’ and the City’s contribution rate. Cost-sharing plans - For the year ended June 30, 2014, active ASRS members and the City were required by statute to contribute at the actuarially determined rate of 11.54 percent (11.3 percent retirement and 0.24 percent long-term disability for members and 10.65 percent retirement, 0.65 percent health and 0.24 percent long-term disability for the City) of the members’ annual covered payroll. The City’s contributions to ASRS for the years ended June 30, 2014, 2013, and 2012, were $3,125,940, $2,982,796, and $2,929,058, respectively, which were equal to the required contributions for the year. In addition, active EORP members and the City were required by statute to contribute 13 percent and 23.5 percent, respectively, of the members’ annual covered payroll. The City’s contributions to EORP for the years ended June 30, 2014, 2013, and 2012, were $77,548, $89,132, and $80,694, respectively, which were equal to the required contributions for the year. Agent plans - For the year ended June 30, 2014, active PSPRS members were required by statute to contribute 10.35 percent of the members’ annual covered payroll, and the City was required to contribute at the actuarially determined rate of 30.92 percent for police and 37.21 percent for fire. Funded Status and Funding Progress – Funding progress of the two agent plans as of June 30, 2013, the most recent valuation, appears below. POLICE FIRE Annual Unfunde d Liability Actual Value of Actuarial Funding Liability Funde d Cove red as Perce ntage of Plan Ass ets Accrued Liability (Exce ss) Ratio Payroll Payroll $ 43,890,713 30,236,758 $ 74,136,630 60,655,630 $ 30,245,917 30,418,872 59.2% $ 10,013,175 49.8% 7,295,392 302.1% 417.0% The schedule of funding progress, presented as Required Supplementary Information following the notes to the financial statements, presents multiyear trend information about whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liability for benefits. Annual Pension Cost - The City’s pension cost for the two agent plans for the year ended June 30, 2013 (the date of the most recent actuarial report), follows: 43 City of Yuma, Arizona NOTES TO THE FINANCIAL STATEMENTS For the Year Ended June 30, 2014 Contribution Rates Annual Pension Cost Contributions Made Actuarial Valuation Date Actuarial Cost Method Actuarial Assumptions: Investment Rate of Return Projected Salary Increases Inflation Projection Cost-of-Living Adjustments Amortization Method Remaining Amortization Period Asset Valuation Method Police Fire 30.92% $2,557,576 $2,557,576 June 30, 2013 Individual entry age 37.21% $2,133,677 $2,133,677 June 30, 2013 Individual entry age 7.85% 4.5%-8.5% 4.5% None Level Percent-of-pay closed 23 years (underfunded) Smoothed market 7.85% 4.5%-8.5% 4.5% None Level Percent-of-pay closed 23 years (underfunded) Smoothed market Trend Information - Information for each of the agent plans as of the most recent actuarial valuations follows: POLICE FIRE 2011 2012 2013 2011 2012 2013 Annual Percent Pension Cost Contributed $ 2,115,546 2,237,780 2,557,576 1,787,905 1,881,117 2,133,677 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% Net Pension $ - G. Noncurrent Liabilities The following changes occurred in noncurrent liabilities during the fiscal year ended June 30, 2014: Governmental activities: Balance July 1, 2013 (as restated) Yuma Municipal Property Corporation $ 112,165,000 Improvement District #67 950,000 Improvement District #68 2,510,000 Unamortized Discount/Issuance Costs (170,232) Unamortized Premium 1,650,335 Compensated Absences 5,779,580 Total Governmental Activity Noncurrent Liabilities $ 122,884,683 Business-type activities: Yuma Municipal Property Corporation $ 110,340,000 Unamortized Discount/Issuance Costs (295,092) Unamortized Premium 3,500,318 Contracts Payable 59,443,795 Compensated Absences 937,661 Total Business-type Activity Noncurrent Liabilities $ 173,926,682 Retirements Balance June 30, 2014 Due Within One Year $ 7,185,000 950,000 265,000 (18,203) 122,522 319,751 $ 104,980,000 2,245,000 (152,029) 1,527,813 5,991,044 $ 7,485,000 280,000 2,336,097 $ 531,215 $ 8,824,070 $ 114,591,828 $10,101,097 $ $ 3,585,000 (15,531) 184,227 4,633,723 48,735 $ 106,755,000 (279,561) 3,316,091 54,810,072 989,200 $ 3,750,000 4,794,841 314,440 $ 8,436,154 $ 165,590,802 $ 8,859,281 Additions $ 531,215 100,274 $ 100,274 44 City of Yuma, Arizona NOTES TO THE FINANCIAL STATEMENTS For the Year Ended June 30, 2014 The City has adopted GASB Statement No. 48, Sales and Pledges of Receivables and Future Revenues and Intra-Entity Transfers of Assets and Future Revenues. The following disclosures are due in part to that statement. Contracts Payable Business-type activities – During fiscal year 2004, the City began construction of major additions to its utility infrastructure, including additional water and wastewater treatment plants. Financing for these additions comes from the Arizona Water Infrastructure Financing Authority (WIFA) in the form of 20-year loan contracts. The city pledged each system’s net revenues as collateral for the debt. Bonded Debt - Excluding Refunded Debt The following is a description of bonded indebtedness at June 30, 2014. In each instance, all bonds have been issued. For each issue, a number of covenants and restrictions are included in the bond indentures. The City is in compliance with these covenants and restrictions. Special Assessment Bonds – Special assessment bonds are issued by the City on behalf of improvement districts created by property owners for a specific purpose. Property owners in the designated districts agree to be assessed for the principal and interest costs of repaying the bonds. As trustee for improvement districts, the City is responsible for collecting the assessments levied against the owners of the property within the improvement districts and for disbursing these amounts to retire the bonds issued to finance the improvements. Special assessment bonds are secured by liens against the property within each district. In the event of delinquency, the City may secure payment of the bonds through sale of the property. All activity related to these bonds is recorded in the City’s Debt Service Fund. Municipal Property Corporation Bonds – In 1970, the City created the Municipal Property Corporation to finance the acquisition or construction of various City projects. Bonds are issued by the corporation and are repaid through unrestricted revenues, primarily excise taxes, by the City. For each issue, the City has pledged its excise tax collections as follows: Excise Taxes – transaction privilege taxes, license fees and franchise fees, along with transaction privilege taxes, income taxes and excise taxes imposed by the State and distributed to the City (except public safety and special sales taxes); Public Safety Taxes – a special two-tenths of one percent (.2%) privilege license tax approved by qualified voters in 1994 for public safety and criminal justice facilities and communication equipment; and Special Sales Taxes – a special two percent (2%) privilege license tax approved by qualified voters in 1993 on the gross proceeds of sales or gross income from the business of bars, restaurants and hotels. For each bond series, the corresponding pledged tax was: Issue 2003 – Series A 2003 – Series B 2007 – Series B 2007 – Series D 2010 – Series B Pledged Tax Excise and Public Safety Taxes Excise Taxes Excise and Special Sales Taxes Excise and Special Sales Taxes Excise Taxes Project(s) funded Refunding 1995 issue Art Center/Fire Station construction Pool/water park/public safety facilities Streets projects Refunding 2001 issue In addition to, or in lieu of, excise taxes, the City may use other operational revenues to repay the debt, as budgeted in each fund. These include payments from the Water, Wastewater, Solid Waste and Desert Hills Golf Course Enterprise Funds, and Highway User Revenue Special Revenue Fund, as determined by the projects acquired or constructed by the debt proceeds. The Municipal Property Corporation issued a Utility Series in 2007. The water and wastewater system’s net revenues were pledged as collateral for this issue as additional parity obligations. Issue 2007 – Series Utilities Pledged Revenues Net Utility System Revenues 45 Project(s) funded Water treatment plant/water distribution City of Yuma, Arizona NOTES TO THE FINANCIAL STATEMENTS For the Year Ended June 30, 2014 For the year ended June 30, 2014, the pledged revenues described above amounted to $68,395,039 for governmental activities and $42,502,612 for business-type activities. The bonded debt collateralized by such revenues is presented below. Total future pledged revenues are not determinable for comparison to total collateralized debt; however, for the year ended June 30, 2014, debt service for governmental activities totaled $13,577,431 and for business-type activities $15,710,379, or 20% and 37% of pledged revenues, respectively. Summary of Bonded Debt Net Interest Rate Yuma Municipal Property Corporation Bonds: 2003 - Series A Refunding 2003 - Series B Refunding 2003 - Series B Addition 2007 - Series B 2007 - Series D 2007 - Series Utilities 2010 - Series B Refunding 4.21% 3.67% 4.18% 4.50% 4.50% 4.50% 4.23% Issue Date Maturity Date 2/18/2003 2/18/2003 2/18/2003 11/20/2007 11/20/2007 11/20/2007 6/29/2010 2015 2015 2022 2027 2027 2032 2025 Total MPC Bonds Total Bonds Authorized and Is sued Authorized and Issued Outstanding 14,640,000 2,905,000 9,000,000 30,785,000 61,100,000 127,925,000 29,530,000 3,050,000 575,000 5,065,000 23,705,000 47,070,000 106,755,000 25,515,000 Unamortized Premium/ (discount) (7,051) (144,978) 1,170,455 3,036,530 357,358 275,885,000 211,735,000 4,412,314 $ 275,885,000 $ 211,735,000 $ 4,412,314 Legal Debt Margin Under Arizona's Constitution, outstanding general obligation bonded debt for combined water, sewer, artificial light, parks, open space preserves, playgrounds and recreational facilities may not exceed 20% of a City's net secondary assessed valuation. Outstanding general obligation debt for all other purposes may not exceed 6% of a City's net secondary assessed valuation. The legal borrowing capacity of the City of Yuma at June 30, 2014, follows: Secondary Assessed Valuation Legal Limit Outstanding G.O. Debt Water, Etc. (20%) All Other (6%) $632,734,838 $ 126,546,968 $ 37,964,090 - Available Debt Margin $ 126,546,968 46 $ 37,964,090 City of Yuma, Arizona NOTES TO THE FINANCIAL STATEMENTS For the Year Ended June 30, 2014 Annual Debt Service Requirements to Maturity July 1 2014 2015 2016 2017 2018 2019 2020 2021 2022 $ Total 694,973 697,347 697,847 692,098 694,628 695,828 695,672 693,833 695,258 6,257,484 MPC Bonds 2003 Refunding 1995A 1,490,000 119,765 1,609,765 1,560,000 62,400 1,622,400 3,050,000 $ 182,165 $ 3,232,165 $ MPC Bonds 2003 Refunding 1995B 280,000 25,250 305,250 295,000 14,750 309,750 575,000 $ 40,000 $ 615,000 MPC Bonds 2007 Series Utility 3,750,000 5,239,138 8,989,138 3,920,000 5,089,138 9,009,138 4,095,000 4,893,138 8,988,138 4,270,000 4,688,388 8,958,388 4,440,000 4,453,538 8,893,538 4,620,000 4,231,538 8,851,538 4,810,000 4,000,538 8,810,538 5,015,000 3,802,125 8,817,125 5,225,000 3,551,375 8,776,375 5,450,000 3,290,125 8,740,125 5,685,000 3,017,625 8,702,625 5,930,000 2,733,375 8,663,375 6,190,000 2,436,875 8,626,875 6,460,000 2,127,375 8,587,375 6,745,000 1,844,750 8,589,750 7,050,000 1,507,500 8,557,500 7,365,000 1,155,000 8,520,000 7,695,000 786,750 8,481,750 402,000 8,442,000 8,040,000 $ 106,755,000 $ 59,250,291 $ 166,005,291 $ MPC Bonds 2007 Series B 1,280,000 1,015,770 2,295,770 1,335,000 964,570 2,299,570 1,390,000 911,170 2,301,170 1,445,000 855,570 2,300,570 1,505,000 797,770 2,302,770 1,565,000 737,570 2,302,570 1,630,000 674,970 2,304,970 1,700,000 606,510 2,306,510 1,770,000 534,260 2,304,260 1,850,000 458,150 2,308,150 1,930,000 365,650 2,295,650 2,010,000 281,212 2,291,212 2,100,000 193,275 2,293,275 2,195,000 98,775 2,293,775 23,705,000 $ 8,495,222 $ 32,200,222 2014 2015 $ 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 BONDS AND IMPROVEMENT DISTRICTS Improvement District No. 68 Bonds MPC Bonds 2003 Series Principal Interest Total Principal Interest 280,000 105,515 385,515 470,000 224,973 290,000 92,355 382,355 490,000 207,347 305,000 78,725 383,725 515,000 182,847 320,000 64,390 384,390 535,000 157,098 335,000 49,350 384,350 560,000 134,628 350,000 33,605 383,605 585,000 110,828 365,000 17,155 382,155 610,000 85,672 635,000 58,833 665,000 30,258 2,245,000 $ 441,095 $ 2,686,095 $ 5,065,000 $ 1,192,484 $ 47 City of Yuma, Arizona NOTES TO THE FINANCIAL STATEMENTS For the Year Ended June 30, 2014 $ BONDS AND IMPROVEMENT DISTRICTS MPC Bonds 2007 Series D MPC Bonds 2010 Refunding 2001 Principal Interest Total Principal Interest Total 2,540,000 2,251,425 4,791,425 1,425,000 1,100,082 2,525,082 2,655,000 2,149,825 4,804,825 1,465,000 1,057,331 2,522,331 2,760,000 2,043,625 4,803,625 1,840,000 1,013,381 2,853,381 2,870,000 1,905,625 4,775,625 1,910,000 939,781 2,849,781 2,985,000 1,762,125 4,747,125 2,010,000 844,282 2,854,282 3,110,000 1,612,875 4,722,875 2,110,000 743,781 2,853,781 3,240,000 1,457,375 4,697,375 2,210,000 638,281 2,848,281 3,375,000 1,323,725 4,698,725 2,305,000 549,881 2,854,881 3,520,000 1,154,975 4,674,975 2,400,000 454,800 2,854,800 3,670,000 978,975 4,648,975 2,500,000 352,800 2,852,800 3,825,000 795,475 4,620,475 2,610,000 240,300 2,850,300 3,995,000 604,225 4,599,225 2,730,000 122,850 2,852,850 4,170,000 404,475 4,574,475 195,975 4,550,975 4,355,000 65,710,700 $ 25,515,000 $ 8,057,550 $ 33,572,550 47,070,000 $ 18,640,700 $ $ WIFA Loan #920069-03 Principal Interest 535,184 182,316 552,904 164,596 571,210 146,290 590,123 127,377 609,662 107,838 629,848 87,652 650,702 66,798 672,247 45,253 22,995 694,505 5,506,385 $ 951,116 $ $ WIFA Loan #920088-04 1,810,202 904,299 1,878,121 836,380 1,948,588 765,913 2,021,699 692,802 2,097,554 616,948 2,176,254 538,248 2,257,907 456,595 2,342,623 371,878 2,430,519 283,983 2,521,712 192,790 2,616,614 98,174 24,101,793 $ 5,758,012 $ July 1 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 CONTRACTS PAYABLE July 1 2014 2015 2016 2017 2018 2019 2020 2021 2022 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 WIFA Loan #910043-03 Total Principal Interest Total 717,500 2,449,455 834,435 3,283,890 717,500 2,530,557 753,333 3,283,890 717,500 2,614,343 669,547 3,283,890 717,500 2,700,904 582,986 3,283,890 717,500 2,790,331 493,559 3,283,890 717,500 2,882,719 401,171 3,283,890 717,500 2,978,166 305,724 3,283,890 717,500 3,076,773 207,117 3,283,890 717,500 3,178,645 105,245 3,283,890 6,457,501 $ 25,201,894 $ 4,353,115 $ 29,555,009 2,714,502 2,714,502 2,714,502 2,714,502 2,714,502 2,714,502 2,714,502 2,714,502 2,714,502 2,714,502 2,714,788 29,859,805 48 City of Yuma, Arizona NOTES TO THE FINANCIAL STATEMENTS For the Year Ended June 30, 2014 H. Interfund Transfers Transfers Out General Fund City Road Tax Debt Service Debt Service General Fund 4,817,663 540,898 Two Percent Tax $ Debt Service General Fund 503,084 540,898 3,902,925 HURF Public Safety Tax Water Wastewater Solid Waste City Road Tax Capital Projects 101,592 2,957,711 62,466 31,927 21,016 4,817,663 370,000 Total Governmental Activities Nonmajor funds: General Fund Mall Maintenance 2,957,711 503,084 Comm Redevelopment Two Percent Tax 55,000 600,000 101,592 370,000 14,204,094 Total Governmental Activities Debt Service Debt Service Debt Service Total Enterprise Funds Enterprise funds: 21,016 Radio Comm General Fund 62,466 Desert Hills Golf Course Two Percent Tax 31,927 115,409 Total Enterprise Funds Public Safety Tax Debt Service Two Percent General Fund Community Redevelopment Desert Hills Golf Course HURF Debt Service Capital Improvement Debt Service Solid Waste Water Wastewater Transfers In Governmental funds - major funds: Radio Comm $ 245,643 General Fund Mall Maintenance 109,578 Debt Service 3,902,925 Debt Service Total Transfers Out $ 14,319,503 109,578 55,000 13,473,860 245,643 600,000 845,643 Total Transfers In $ 14,319,503 The majority of the transfers listed above are for debt service requirements and are recognizable by the fund from which the transfer is made. This includes Enterprise Fund transfers to debt service as the majority of the related bond debt service is governmental in nature and is recorded in the Debt Service Fund rather than within the Enterprise Funds. As for the remaining transfers, they include operating subsidies from the Two Percent Tax Fund to the General Fund ($503,084 per a riverfront development agreement), to the Community Redevelopment Fund ($55,000 for land exchange) and to the Desert Hills Golf Course Fund ($600,000 for capital improvements). Interfund activity is eliminated within the governmental activities column of the Statement of Activities. Only transfers between governmental and business-type activities appear on that statement. The net transfers of $730,234 are for debt service ($115,409), Radio Maintenance $245,643 and a CIP project funded by Two Percent Tax $600,000. 49 City of Yuma, Arizona NOTES TO THE FINANCIAL STATEMENTS For the Year Ended June 30, 2014 I. Interfund Receivables and Payables Interfund balances at June 30, 2014, follow: Interfund Receivable Major Funds Interfund Payable Nonmajor Governmental Funds: Public Safety Tax Fund Community Redevelopment Fund Grants Fund Yuma Mall Maintenance Fund Internal Service Funds: Equipment Maintenance Workers Compensation Total Receivable General $ 109,156 235,815 374,376 3,306 967,213 775,048 $ 2,464,914 Because they serve primarily governmental funds, the interfund activity noted above in the Internal Service Equipment Maintenance and Workers Compensation Funds are combined within the governmental activities for government-wide reporting. As such, the interfund activity is eliminated in the governmental activities column of the Statement of Net Position. The internal balances amount appearing on that statement, $881,366, represents net balances allocated to business-type activities for consolidation of internal service funds net profits. J. Risk Management The City is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors and omissions; job-related illnesses and injuries to employees; and natural disasters. The City purchases commercial insurance for Property Insurance, Public Employee Fidelity Bonds, Crime Insurance, Excess Workers Compensation, and Miscellaneous Insurance (i.e. surety bonds, special event insurance as needed, and fine arts coverage.) The City retains all the risk not covered by commercial carriers and has effectively managed risk through various employee education and prevention programs. Settled claims resulting from these risks have not exceeded commercial insurance coverage in any of the past three fiscal years. The City provides health benefits to its employees and their dependents through the Yuma Area Benefit Consortium (trust). The trust is comprised of four participating entities and provides benefits through a selffunding trust agreement with its members. The consortium purchases insurance for claims in excess of $100,000 per individual per plan year. A third-party administrator provides claim processing and record keeping services. The City is responsible for paying premiums while employees must contribute for costs of dependent coverage. The trust sets rates through projection of claims cost and administrative expenses, along with a determination of sufficient fund balance to maintain rate stability and trust integrity. Should the Consortium become insolvent or otherwise unable to discharge its liabilities, the participating entities shall be assessed a pro rata share. This assessment may not exceed the amount of each participating entity’s annual contribution. Benefit payments to beneficiaries are limited to the amount in the trust. Should the assessment not yield sufficient funds to pay outstanding claims, the trust’s obligation to pay claims is limited to the amount in the trust after assessment and the trustees and the participating entities have no further obligation of any type. The City uses two Internal Service Funds, Insurance Reserve Fund and Workers Compensation Fund, to account for the financing of its risk of loss relating to claims. Charges assessed to the funds are based on historical claims, exposure to risk, and funding necessary reserves. Annually, the City estimates the liabilities for unpaid claims using a historical cost information method. Claims and expenses are recognized when it is probable that a loss has been incurred, and the amount of the loss can be reasonably estimated. Claims accounted for include, reported and paid claims, reported but unpaid claims, and incurred but not reported (IBNR) claims. The funds’ claims liabilities are presented below. 50 City of Yuma, Arizona NOTES TO THE FINANCIAL STATEMENTS For the Year Ended June 30, 2014 Insurance Reserve Fund Fiscal Year 2013-14 2012-13 2011-12 Beginning of Year Liability $ 65,546 72,477 60,112 Claims and Changes In Estimates $ 348,487 249,826 528,959 Workers Compensation Fund End of Year Liability Claim Payments $ 342,232 256,757 516,594 $ Beginning of Year Liability 71,801 $ 969,373 65,546 1,248,076 72,477 998,021 Claims and Changes In Estimates Claim Payments End of Year Liability $ 1,508,300 91,717 1,484,491 $ 1,048,478 370,420 1,234,436 $ 1,429,195 969,373 1,248,076 K. Construction Commitments The City has active construction projects as of June 30, 2014. At year-end the government’s commitments with contractors for specific projects are as follows: Construction Commitments Parks & Recreation Water System Original Contract $ 2,689,118 177,829 Spent to Date $ 2,325,608 76,765 Remaining Commitment $ 363,510 101,064 $ $ $ 2,866,947 2,402,373 464,574 L. Issuance Cost & Loan Revenue Restatement – Water, Wastewater, Government-Wide Per GASB Statement No. 65, debt issuance costs, other than prepaid insurance costs, should be recognized as an expense in the period incurred. The City of Yuma has been amortizing the issuance costs on the 2003, 2007 and 2010 debt issues. The 2003B, 2007B, 2007D, and 2010B debt issues are reported in the government-wide Statement of Net Position as a portion of Debt. The 2007Utility debt issue is reported on the Statement of Net Position Proprietary Funds with Unamortized Premium/Insurance Costs. In addition, the City of Yuma has Special Assessment and CDBG Loan amounts offset in the Governmental Funds by Deferred Inflows of Resources at the time of the original transaction. Using the economic resources measurement focus and accrual basis of accounting, these amounts should have been recorded as additions to net assets on the Statement of Net Position – Governmental Activities. For the fiscal year ended June 30, 2014, prior year balances have been restated as follows: Statement of Activities Governmental Activities Net position, June 30, 2013, as previously reported Restating Issuance Costs per GASB 65 Restating Special Assessment Revenues Restating CDBG Loan Revenues Net position, July 1, 2013, as restated $ 269,894,895 (573,768) 3,428,000 1,011,524 273,760,651 $ Statement of Activities Business-type Activities Net position, June 30, 2013, as previously reported Restating Issuance Costs per GASB 65 Net position, July 1, 2013, as restated $ Water Fund Wastewater Fund 215,721,579 $ 101,079,942 $108,329,769 (161,596) (48,268) (209,865) 215,511,714 $ 100,918,346 $108,281,501 $ 51 City of Yuma, Arizona NOTES TO THE FINANCIAL STATEMENTS For the Year Ended June 30, 2014 M. Deficits in Fund Equity At June 30, 2014, no funds, as shown in the basic financial statements, were in a deficit position. The Equipment Maintenance and Workers Compensation Internal Service Funds, as shown in the Combining Statement of Net Position in Other Supplementary Information, have deficit balances of $57,696 and $278,514, respectively, at June 30, 2014. The City intends to adjust its internal charges in future fiscal years to eliminate these deficits. III. CONTINGENT LIABILITIES A. Pending Litigation The City is contingently liable in respect to lawsuits and other claims incidental to the ordinary course of its operations. It is the opinion of the City management, based on the advice of the City Attorney, that such matters will not have a material adverse effect on the City's financial position at June 30, 2014. B. Compliance The City participates in federally-funded and state-funded programs administered by various government agencies. The programs included in these financial statements may be subject to program compliance and/or financial monitoring by the granting agency or its representatives. The amount, if any, of expenditures that may be disallowed by the granting agencies cannot be determined at this time. 52 REQUIRED SUPPLEMENTARY INFORMATION 53 Schedule of Funding Progress Public Safety Personnel Retirement System Actual Value of Plan Assets POLICE 2011 2012 2013 FIRE 2011 2012 2013 $ Actuarial Accrued Liability Funding Liability (Excess) 43,968,517 43,985,939 43,890,713 $ 64,818,702 71,320,513 74,136,630 $ 20,850,185 27,334,574 30,245,917 67.8% 61.7% 59.2% 30,253,905 30,455,972 30,236,758 52,542,833 57,516,428 60,655,630 22,288,928 27,060,456 30,418,872 57.6% 53.0% 49.8% Note: 2013 is the most recent actuarial valuation report available. 54 Annual Covered Payroll Funded Ratio $ Unfunded Liability as Percentage of Payroll 9,350,250 9,175,414 10,013,175 223.0% 297.9% 302.1% 5,973,174 6,560,746 7,295,392 373.2% 412.5% 417.0% City of Yuma, Arizona Budgetary Comparison Schedule General Fund (Non-GAAP Budgetary Basis) For the Year Ended June 30, 2014 Budgetary Fund Balance, July 1 Resources (inflows): Taxes: Property Tax - Primary Property Tax - Delinquent City Sales Tax Public Enterprise In-Lieu Franchise Tax Total Taxes Licenses: Business Licenses Liquor Licenses Building Permits Alcohol Permits Animal Licenses Total Licenses Intergovernmental: Sales Tax - State State Revenue Sharing Auto Lieu Tax Other Governmental Charges Total Intergovernmental Charges for Services: Building Inspection Fees Developer Charges Recreation Fees Police Services Fire Ambulance Services Other Charges Total Charges for Services Fines and Forfeitures: City Court Fines Total Fines and Forfeitures Use of Money and Property: Interest Rental Receipts Total Use of Money and Property Miscellaneous Sales of Surplus Property Other Total Miscellaneous Total Revenues Transfers In Amounts Available for Appropriation Budget Original Final $ 13,986,007 $ 13,986,007 Actual Amounts $ 19,814,886 Variance with Final Budget Positive (Negative) $ 5,828,879 9,500,000 325,000 19,792,000 242,000 3,070,200 32,929,200 9,500,000 325,000 19,792,000 242,000 3,070,200 32,929,200 9,107,069 232,786 19,517,306 242,000 3,009,904 32,109,065 (392,931) (92,214) (274,694) (60,296) (820,135) 290,000 31,750 1,003,500 10,000 100,000 1,435,250 290,000 31,750 1,003,500 10,000 100,000 1,435,250 250,365 32,560 1,492,399 9,482 95,295 1,880,101 (39,635) 810 488,899 (518) (4,705) 444,851 7,833,710 10,114,498 3,149,580 21,097,788 7,833,710 10,114,498 3,149,580 21,097,788 7,507,882 9,656,745 3,111,124 23,913 20,299,664 (325,828) (457,753) (38,456) 23,913 (798,124) 255,650 495,550 510,000 2,500,000 2,000 3,763,200 255,650 495,550 510,000 2,500,000 2,000 3,763,200 544,566 10,861 513,535 700,597 2,490,377 42,526 4,302,462 288,916 10,861 17,985 190,597 (9,623) 40,526 539,262 1,527,000 1,527,000 1,527,000 1,527,000 1,209,502 1,209,502 (317,498) (317,498) 52,000 137,830 189,830 52,000 137,830 189,830 99,738 225,890 325,628 171,000 171,000 61,113,268 557,323 75,656,598 171,000 171,000 61,113,268 557,323 75,656,598 See accompanying notes to this schedule 55 47,738 88,060 135,798 33,541 33,541 241,402 70,402 274,943 103,943 60,401,365 (711,903) 1,043,982 486,659 81,260,233 5,603,635 Continued on next page City of Yuma, Arizona Budgetary Comparison Schedule General Fund (Non-GAAP Budgetary Basis) For the Year Ended June 30, 2014 Budget Original Charges to Appropriations (outflows): General Government: Mayor and Council Elections City Administrator Strategic Communications Neighborhood Services Economic Development Facilities Maintenance General Government City Clerk City Attorney City Prosecutor Finance-Administration Accounting Customer Services Information Technology Services Purchasing Human Resources Intragovernmental Charges Total General Government Operating Expenditures Capital Outlay Total General Government Expenditures Public Safety: Police Administration - Field Operations Police Animal Control Police Support Services Police Communication Center Police 911 Administration Fire Administration Fire Training Fire Suppression Fire Suppression - Ambulance Community Risk Reduction Facilities Maintenance Fire Special Operations Municipal Court Total Public Safety Operating Expenditures Capital Outlay Total Public Safety Expenditures Final Actual Amounts 216,812 120,000 639,761 583,898 557,323 346,907 903,012 1,919,626 266,759 1,079,391 246,934 338,869 1,006,747 109,513 2,666,861 426,825 932,541 (3,135,682) 9,226,095 9,226,095 286,812 105,000 587,207 538,969 557,323 346,907 973,012 1,875,126 266,921 1,079,391 246,934 338,869 982,247 116,013 2,666,861 426,825 947,041 (3,135,682) 9,205,774 173,567 9,379,341 264,746 104,891 593,231 459,686 503,084 333,199 923,991 1,850,022 268,725 1,079,033 227,069 297,996 914,715 96,772 2,536,227 408,215 960,618 (3,135,682) 8,686,538 155,229 8,841,767 17,486,608 712,068 2,093,808 1,981,144 5 768,754 424,463 9,362,883 2,323,098 308,157 1,213,110 38,431 1,506,372 38,218,902 24,764 17,473,897 712,068 2,093,808 1,981,195 5 768,754 424,463 9,362,883 2,323,098 308,157 1,201,610 53,195 1,536,372 38,239,506 22,660 18,024,577 678,113 2,048,963 1,988,250 830,227 414,186 9,757,244 2,746,181 304,515 1,036,166 43,290 1,536,380 39,408,092 12,779 38,243,666 38,262,166 See accompanying notes to this schedule 56 Variance with Final Budget Positive (Negative) 22,066 109 (6,024) 79,283 54,239 13,708 49,021 25,104 (1,804) 358 19,865 40,873 67,532 19,241 130,634 18,610 (13,577) 519,236 18,338 537,574 (550,680) 33,955 44,845 (7,055) 5 (61,473) 10,277 (394,361) (423,083) 3,642 165,444 9,905 (8) (1,168,586) 9,881 39,420,871 (1,158,705) Continued on next page City of Yuma, Arizona Budgetary Comparison Schedule General Fund (Non-GAAP Budgetary Basis) For the Year Ended June 30, 2014 Budget Original Parks, Recreation and Culture: Parks and Recreation Administration Parks Maintenance Parks Development Recreation Administration Senior Adult Activities Adult Activities Youth Activities Aquatics Yuma Readiness Center Facilities Maintenance Intragovernmental Charges Total Parks, Recreation and Culture Operating Expenditures Capital Outlay Total Parks, Recreation and Culture Expenditures Community Design and Development: Community Development Administration Development Engineering Planning and Building Safety Neighborhood Services Heritage Area Development Total Community Design and Development Operating Expenditures Capital Outlay Total Community Design and Development Expenditures Total Operating Expenditures Capital Outlay Total Expenditures Transfers Out Total Charges to Appropriations Budgetary Fund Balance, June 30 Final Actual Amounts Variance with Final Budget Positive (Negative) 543,573 4,306,362 156,071 605,922 68,106 215,315 228,853 367,994 78,453 1,266,212 (216,956) 543,573 4,315,062 152,771 605,922 61,106 215,315 228,853 362,994 78,453 1,207,712 (216,959) 512,020 4,287,960 136,877 534,186 46,189 207,862 258,625 326,536 65,437 1,149,825 (216,956) 31,553 27,102 15,894 71,736 14,917 7,453 (29,772) 36,458 13,016 57,887 (3) 7,619,905 7,619,905 7,554,802 6,600 7,561,402 7,308,561 14,924 7,323,485 246,241 (8,324) 237,917 416,669 402,563 2,350,097 182,552 335,351 416,669 402,563 2,350,097 244,306 335,351 395,187 321,296 2,217,652 221,794 340,007 21,482 81,267 132,445 22,512 (4,656) 3,687,231 11,000 3,748,985 11,000 3,495,936 10,265 253,049 735 3,698,231 58,752,133 35,764 58,787,897 4,377,807 63,165,704 3,759,985 58,749,067 213,827 58,962,894 4,377,807 63,340,701 3,506,201 58,899,127 193,197 59,092,324 4,258,146 63,350,470 253,784 (150,060) 20,630 (129,430) 119,661 (9,769) $ 12,490,894 $ 12,315,897 $ 17,909,763 See accompanying notes to this schedule 57 $ 5,593,866 Concluded City of Yuma, Arizona Budgetary Comparison Schedule City Road Tax Fund For the Year Ended June 30, 2014 Budgetary Fund Balance, July 1 Resources (inflows): Taxes Special Road Sales Tax Use of Money and Property Rent Interest Charges For Services Developer Charges Miscellaneous Other Total Revenues Amounts Available for Appropriation Charges to Appropriations (outflows): Current: Public Safety Traffic Signals, Signs, and Striping Streets Engineering Street Maintenance Pathways and Trails Right-Of-Way Management Capital Outlay Capital Projects Parks, Recreation and Culture Streets Environmental, Health and Safety Total Expenditures Transfers Out Total Charges to Appropriations Budgetary Fund Balance, June 30 Budget Original Final $ 5,630,380 $ 5,630,380 Actual Amounts $ 6,169,642 Variance with Final Budget Positive (Negative) $ 539,262 9,894,180 9,894,180 9,756,994 (137,186) 405,853 10,000 405,853 10,000 365,455 38,293 (40,398) 28,293 - - 3,821 3,821 5,596 2,000 2,000 7,596 10,312,033 15,942,413 10,312,033 15,942,413 10,172,159 16,341,801 754,599 706,759 586,869 1,879,053 382,774 161,468 448,247 100,500 1,876,753 382,774 161,468 498,387 100,500 1,328,393 244,926 139,693 524,518 65,891 548,360 137,848 21,775 (26,131) 34,609 327,854 3,155,797 85,000 327,854 3,155,797 91,000 65,113 598,479 160,052 262,741 2,557,318 (69,052) 7,295,292 4,816,508 12,111,800 7,301,292 4,816,508 12,117,800 3,713,934 4,817,663 8,531,597 3,587,358 (1,155) 3,586,203 $ 3,830,613 $ 3,824,613 $ 7,810,204 See accompanying notes to this schedule 58 (139,874) 399,388 119,890 $ 3,985,591 City of Yuma, Arizona NOTES TO REQUIRED SUPPLEMENTARY INFORMATION For the Year Ended June 30, 2014 A. Budgetary Reporting and Budgetary Basis of Accounting Budgets are adopted on a basis substantially consistent with generally accepted accounting principles (GAAP), with the exception of the Enterprise Funds and Internal Service Funds for which budgets are adopted. As such, reconciliations between budgetary schedules and financial statements are not necessary for governmental funds. For Enterprise Funds and Internal Service Funds, expenditures related to debt service and to capital acquisition are budgeted in the same manner as governmental funds. Depreciation is not budgeted. Reconciliations from budgetary schedules and financial statements of these funds are presented on the face of the respective budgetary statements. B. Excess of Expenditures Over Appropriations The City’s expenditures exceeded appropriations in four funds. General Fund Expenditures exceeded appropriations by $129,427 due to overtime needed in excess of projections by the new Ambulance Transport division. The Debt Service Fund had expenditures exceed appropriations by $969,651 due to the final year of District 67 debt payments not being budgeted. Restructuring of the Restaurant staffing levels caused expenditures within the Desert Hills Golf Course fund to exceed appropriations by $204,625. The Equipment Maintenance Fund had expenditures exceed appropriations by $128,269 after providing unplanned repair services during the year with attendant auto parts purchases. In each case, the fund was not significantly impaired by the excess expenditures. 59 60 OTHER SUPPLEMENTARY INFORMATION 61 62 NONMAJOR GOVERNMENTAL FUNDS Special Revenue Funds Special Revenue Funds account for the proceeds of special revenue sources that are used to finance projects or activities as required by law or contractual agreements. Local Transportation Assistance To record the receipts and uses of monies originating from Arizona Lottery sales. These monies are restricted to transportation uses. Public Safety Tax To account for the two-tenths percent sales tax designated for public safety and criminal justice facilities and equipment. Highway Users Revenue. To account for the state-shared gasoline taxes designated for maintenance and construction of roadways. Grants Fund. The Grant Fund accounts for all of the federal and state grants provided to the City with the exception of the grants received for the Yuma Regional Communication System (recorded in Radio Communications Enterprise Fund), the Water Fund (recorded in Water Enterprise Fund), the Community Development Block Grant, and the Economic Development grant. Community Redevelopment Fund This fund accounts for the financial activities of Community Development Block Grant and the Economic Development Grant. Two Percent Tax To record the financial activities of the Two Percent Special Revenue Excise Tax on hotel, motel, restaurant and bar sales. This tax can finance the operations of the Art Center, the Civic and Convention Center, Baseball Complex, Golf Courses, the Yuma Crossing Area and Convention and Tourism. Yuma Mall Maintenance To record the special maintenance levy for the Yuma Downtown Mall District. The assessment supports cleaning, maintenance, landscaping and utility costs of common areas. Costs in excess of the assessment are financed by a transfer from the General Fund. Capital Projects Fund The Capital Projects Fund is used to account for and report financial resources to be used for acquisition or construction of capital facilities and other capital assets (other than those financed by General, Special Revenue, or Proprietary Funds. 63 City of Yuma, Arizona Combining Balance Sheet Nonmajor Governmental Funds June 30, 2014 Assets Cash and Investments Receivables (Net of Allowances for Uncollectibles): Accounts Receivable Intergovernmental Delinquent Property Taxes Accrued Interest Inventory, at cost Prepaid Items Total Assets Special Revenue Public Highway Safety Users Tax Revenue Local Transportation Assistance $ 144 $ 144 $ - $ 237,702 683 238,385 $ 482,713 $ 8,649 592,005 33 188 1,083,588 Grants $ 293,244 $ 594,935 66 888,245 Liabilities Liabilities: Accounts Payable Accrued Payroll, Taxes and Benefits Payable Due to Other Funds Deposits Unearned Revenues Total Liabilities $ - Deferred Inflows of Resources Unavailable Revenues Fund Balances: Nonspendable: Inventory Prepaid Items Restricted for: General government projects Streets Public safety equipment and facilities Recreation facilities Committed to: General government projects Public safety equipment and facilities Parks, recreation and cultural facilities Streets Sanitation facilities Public works projects Total Fund Balances Total Liabilities, Deferred Inflows of Resources, and Fund Balance $ - 124,075 233,543 163,150 38,771 201,921 - - - - - - 188 - 163 149 109,156 $ $ 195,316 20,496 374,376 298,057 888,245 - 4,842 - 881,479 - - 144 144 4,842 881,667 - 144 64 $ $ 238,385 $ 1,083,588 $ 888,245 Special Revenue Community Redevelopment $ $ $ $ - 989,441 418,359 1,407,800 181,826 8,926 235,815 700 427,267 Two Percent Tax $ 4,964,420 $ 139,709 2,104 13,534 5,119,767 $ 182,037 30,739 8,949 110,060 331,785 Yuma Mall Maintenance Capital Projects Total Nonmajor Governmental Funds $ - $ 15,381,240 $ 21,121,761 $ 461 7,966 13,527 21,954 127,439 661,516 2,667 $ 16,172,862 1,265,699 2,512,483 13,527 5,553 13,534 188 $ 24,932,745 $ $ $ 3,669 1,452 3,306 8,427 281,838 3,179,469 3,461,307 1,007,999 100,533 722,653 8,949 3,712,361 5,552,495 980,533 - 13,527 - 994,060 - 13,534 - - - 13,534 188 - 4,774,448 - 96,208 3,769,061 1,731,749 96,208 96,208 4,650,540 1,736,591 4,870,656 - 4,787,982 - 2,845 1,232,387 1,868,923 3,279,300 378,910 255,964 12,711,555 2,845 1,232,387 1,868,923 3,279,444 378,910 255,964 18,386,190 $ 16,172,862 $ 24,932,745 1,407,800 $ 5,119,767 $ 21,954 65 City of Yuma, Arizona Combining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Governmental Funds For the Year Ended June 30, 2014 Special Revenue Public Highway Safety User Tax Revenue Local Transportation Assistance Revenues: Taxes Intergovernmental Charges for Services Use of Money and Property Contributions/Donations Miscellaneous Total Revenues $ 1 1 Expenditures: Current: General Government Public Safety Streets Parks, Recreation and Culture Environmental Health and Protection Community Design and Development Capital Outlay Capital Projects General Government Public Safety Streets - Parks, Recreation and Culture Environmental, Health and Safety Debt Service: Interest and Fiscal Agent Fees Total Expenditures 1,113,248 - 2,297,672 594 88,347 2,386,613 395,492 5,354,549 - 79,270 1,434,199 68,833 10,525 - 474,556 - 211,653 - - - 374,493 136,011 - - - 71,629 - 1,587,804 5,811,975 2,349,946 559,638 - - (2,957,711) (101,592) - - (2,957,711) (101,592) - (607,765) 458,046 - 612,607 423,621 - Net Changes in Fund Balances 1 143 $ $ 61,934 1 Fund Balances, Beginning 6,276,058 1,274 94,281 6,371,613 - - Other Financing Sources/(Uses): Transfers In Transfers Out Total Other Financing Sources/(Uses) $ - Revenues Over/(Under) Expenditures Fund Balances, Ending $ 3,901,471 36,233 46 3,937,750 Grants 144 66 $ 4,842 $ 881,667 2,386,613 $ - Special Revenue Community Redevelopment $ 1,342,289 30,991 1,373,280 Two Percent Tax $ - $ 197,968 3,822,512 81,320 4,409 85,729 Capital Projects $ 38,189 2,311,433 43,178 419 2,393,219 Total Nonmajor Governmental Funds $ 8,558,852 9,954,208 2,780,193 109,742 88,347 173,395 21,664,737 - - 277,238 2,942,939 5,354,549 3,891,345 - - - 72,459 40,688 195,307 - - 1,599,911 750,573 - 139,850 14,097 - 351,917 1,679,268 1,756,362 866,260 1,679,268 1,906,470 - 1,343,622 - - 828,409 172,911 2,243,660 172,911 5,558,737 195,307 7,700 4,796,567 7,700 21,765,283 (109,578) (2,403,348) (100,546) 1,404,604 23,676 1,428,280 (55,000) $ 4,576,061 468,760 28,462 43,249 5,116,532 Yuma Mall Maintenance (442,205) 55,000 - (1,158,084) 109,578 - (370,000) 164,578 (4,587,387) 55,000 (1,158,084) 109,578 (370,000) (4,422,809) - (1,600,289) - (2,773,348) (4,523,355) - 6,388,271 - 15,484,903 22,909,545 - $ 12,711,555 $ 18,386,190 - $ 4,787,982 $ 67 City of Yuma, Arizona Budgetary Comparison Schedule Debt Service Fund For the Year Ended June 30, 2014 Final 504,492 Actual Amounts $ 543,115 Variance with Final Budget Positive (Negative) $ 38,623 280,000 280,000 1,183,000 903,000 105,515 385,515 12,256,162 13,146,169 105,515 385,515 12,256,162 13,146,169 131,610 1,314,610 12,265,300 14,123,025 26,095 929,095 9,138 976,856 7,765,000 4,842,780 12,607,780 12,607,780 7,765,000 4,842,780 12,607,780 12,607,780 8,700,000 4,866,581 10,850 13,577,431 540,898 14,118,329 $ 538,389 $ $ Budget Budgetary Fund Balance, July 1 Resources (inflows): Special Assessments: Principal Payments Use of Money and Property: Interest Total Revenues Transfers In Amounts Available for Appropriation Charges to Appropriations (outflows): Debt Service: Bond Principal Bond Interest Fiscal Agent Fees Total Expenditures Transfers Out Total Charges to Appropriations Budgetary Fund Balance, June 30 Original $ 504,492 68 $ 538,389 4,696 (935,000) (23,801) (10,850) (969,651) (540,898) (1,510,549) $ (533,693) City of Yuma, Arizona Budgetary Comparison Schedule Capital Projects Fund For the Year Ended June 30, 2014 Budgetary Fund Balance, July 1 Resources (inflows): Intergovernmental Arizona Department of Transportation Charges for Services Developer Charges Use of Money and Property Interest Miscellaneous Total Revenues Amounts Available for Appropriation Budget Original Final $ 16,710,692 $ 16,710,692 - Charges to Appropriations (outflows): Capital Outlay: General Government Public Safety Streets Parks, Recreation and Culture Environmental Health and Safety Total Expenditures Debt Service: Fiscal Agent Fees Total Expenditures Transfers Out Total Charges to Appropriations Budgetary Fund Balance, June 30 $ - Actual Amounts $ 15,484,903 Variance with Final Budget Positive (Negative) $ (1,225,789) 38,189 38,189 3,324,037 3,324,037 2,311,433 (1,012,604) 22,900 7,419,962 10,766,899 27,477,591 22,900 7,419,962 10,766,899 27,477,591 43,178 419 2,393,219 17,878,122 20,278 (7,419,543) (8,373,680) (9,599,469) 8,594,000 986,000 6,156,112 2,546,712 18,282,824 8,269,000 2,167,102 5,868,112 1,605,610 373,000 18,282,824 351,917 1,679,268 1,756,362 828,409 172,911 4,788,867 7,917,083 487,834 4,111,750 777,201 200,089 13,493,957 18,282,824 18,282,824 18,282,824 18,282,824 7,700 4,796,567 370,000 5,166,567 (7,700) 13,486,257 (370,000) 13,116,257 9,194,767 $ 12,711,555 9,194,767 69 $ $ 3,516,788 City of Yuma, Arizona Budgetary Comparison Schedule Local Transportation Assistance Special Revenue Fund For the Year Ended June 30, 2014 Budget Original Final Budgetary Fund Balance, July 1 $ Resources (inflows): Use of Money and Property Interest Total Revenues Amounts Available for Appropriation Charges to Appropriations (outflows): Current: Total Charges to Appropriations Budgetary Fund Balance, June 30 $ 143 $ 143 - - 143 143 70 $ Actual Amounts Variance with Final Budget Positive (Negative) $ $ 143 - 1 1 1 1 143 144 1 - - 143 $ 144 $ 1 City of Yuma, Arizona Budgetary Comparison Schedule Public Safety Tax Special Revenue Fund For the Year Ended June 30, 2014 Budgetary Fund Balance, July 1 Resources (inflows): Taxes Public Safety Sales Tax Charges for Services Use of Money and Property Rent Interest Miscellaneous Other Total Revenues Budget Original Final $ 744,007 $ 744,007 Amounts Available for Appropriation Actual Amounts $ 612,607 Variance with Final Budget Positive (Negative) $ (131,400) 3,956,000 - 3,956,000 - 3,901,471 - (54,529) 5,000 5,000 28,793 7,440 3,961,000 4,705,007 3,961,000 4,705,007 46 3,937,750 4,550,357 46 (23,250) (154,650) 456,192 548,579 156,500 500,000 1,661,271 456,192 548,579 156,500 500,000 1,661,271 456,140 557,379 99,729 474,556 1,587,804 52 (8,800) 56,771 25,444 73,467 2,953,213 4,614,484 2,953,213 4,614,484 2,957,711 4,545,515 (4,498) 68,969 28,793 2,440 Charges to Appropriations (outflows): Current: Public Safety Police Support Services Fire Support Services Facility Maintenance Capital Outlay Total Expenditures Transfers Out Total Charges to Appropriations Budgetary Fund Balance, June 30 $ 90,524 71 $ 90,524 $ 4,842 $ (85,682) City of Yuma, Arizona Budgetary Comparison Schedule Highway User Revenue Fund For the Year Ended June 30, 2014 Budgetary Fund Balance, July 1 Resources (inflows): Intergovernmental State Gasoline Tax Use of Money and Property Interest Miscellaneous Other Total Revenues Actual Amounts $ 423,621 6,399,000 6,399,000 6,276,058 (122,942) 1,000 1,000 1,274 42,000 6,442,000 7,153,568 42,000 6,442,000 7,153,568 94,281 6,371,613 6,795,234 443,567 464,567 395,492 3,039,620 835,200 412,247 380,530 379,925 1,073,296 3,011,120 906,600 412,247 365,530 369,925 1,034,396 2,652,698 954,035 393,985 226,128 314,517 813,186 358,422 (47,435) 18,262 139,402 55,408 221,210 81,052 6,645,437 101,374 6,746,811 81,052 6,645,437 101,374 6,746,811 61,934 5,811,975 101,592 5,913,567 19,118 833,462 (218) 833,244 Budget Original $ 711,568 $ Amounts Available for Appropriation Charges to Appropriations (outflows): Current: Public Safety Traffic Signals, Signs, and Striping Streets Street Maintenance Street Lighting Street Sweeping Storm Drain Maintenance Curbs, Gutters, and Sidewalks Retention Basin Maintenance Environmental Health Code Enforcement Total Expenditures Transfers Out Total Charges to Appropriations Budgetary Fund Balance, June 30 Final 711,568 Variance with Final Budget Positive (Negative) $ (287,947) $ 406,757 72 $ 406,757 $ 881,667 274 52,281 (70,387) (358,334) 69,075 $ 474,910 City of Yuma, Arizona Budgetary Comparison Schedule Grants Fund For the Year Ended June 30, 2014 Budget Budgetary Fund Balance, July 1 Resources (inflows): Intergovernmental Federal Government State Government County Government Budget Authority Reserve Use of Money and Property Interest Contributions/Donations Total Revenues Amounts Available for Appropriation Charges to Appropriations (outflows): Current: General Government Public Safety Parks, Recreation and Culture Environmental Health and Protection Capital Outlay Capital Projects General Government Streets Parks, Recreation and Culture Total Expenditures Total Charges to Appropriations Budgetary Fund Balance, June 30 $ Original - Final $ - Actual Amounts $ - Variance with Final Budget Positive (Negative) $ - 1,417,659 207,957 8,508,115 2,227,671 316,251 3,165 6,768,881 2,230,556 63,952 3,164 - 2,885 (252,299) (1) (6,768,881) 208,457 10,342,188 10,342,188 233,804 9,549,772 9,549,772 594 88,347 2,386,613 2,386,613 594 (145,457) (7,163,159) (7,163,159) 219,886 5,121,991 267,700 288,500 36,000 223,886 3,807,078 257,619 288,500 389,578 79,270 1,434,199 68,833 10,525 211,653 144,616 2,372,879 188,786 277,975 177,925 755,413 4,408,113 812,700 11,910,303 11,910,303 755,413 4,408,113 812,700 10,942,887 10,942,887 374,493 136,011 71,629 2,386,613 2,386,613 380,920 4,272,102 741,071 8,556,274 8,556,274 $ (1,568,115) 73 $ (1,393,115) $ - $ 1,393,115 City of Yuma, Arizona Budgetary Comparison Schedule Community Redevelopment Fund For the Year Ended June 30, 2014 Budget Budgetary Fund Balance, July 1 Resources (inflows): Intergovernmental Federal Government Miscellaneous Loan Repayments Other Total Revenues Transfers In Original $ - Final $ - Actual Amounts $ - Variance with Final Budget Positive (Negative) $ - 1,474,565 1,666,981 1,342,289 (324,692) 17,500 70,000 1,562,065 - 17,500 70,000 1,754,481 - 30,991 1,373,280 55,000 Amounts Available for Appropriation 1,562,065 1,754,481 1,428,280 13,491 (70,000) (381,201) 55,000 (326,201) Charges to Appropriations (outflows): Current: Community Design and Development Capital Outlay Total Expenditures Total Charges to Appropriations 1,562,065 1,562,065 1,562,065 1,725,481 29,000 1,754,481 1,754,481 1,404,604 23,676 1,428,280 1,428,280 320,877 5,324 326,201 326,201 Budgetary Fund Balance, June 30 $ - 74 $ - $ - $ - City of Yuma, Arizona Budgetary Comparison Schedule Two Percent Tax Special Revenue Fund For the Year Ended June 30, 2014 Budget Budgetary Fund Balance, July 1 Resources (inflows): Taxes Two PercentTax Use of Money and Property Rents and Concessions Recreation Fees Interest Miscellaneous Other Total Revenues Amounts Available for Appropriation Charges to Appropriations (outflows): Current: Parks, Recreation and Culture Administration Outside Agencies Civic and Convention Center Baseball Complex Art Center Heritage Events Facilities Maintenance General Government Capital Outlay Capital Projects: General Government Parks, Recreation and Culture Streets Total Expenditures Transfers Out Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with Final Budget Positive (Negative) $ 1,050,455 Original $ 5,337,816 Final $ 5,337,816 Actual Amounts $ 6,388,271 4,468,337 4,468,337 4,576,061 107,724 276,960 71,150 12,800 276,960 71,150 12,800 358,636 110,124 28,462 81,676 38,974 15,662 55,010 4,884,257 10,222,073 55,010 4,884,257 10,222,073 43,249 5,116,532 11,504,803 (11,761) 232,275 1,282,730 181,174 840,000 968,801 539,580 620,858 95,433 813,335 193,927 89,500 181,174 840,000 968,801 536,280 620,858 95,433 804,435 193,927 101,700 167,803 840,000 919,055 500,965 576,768 96,793 721,128 197,968 40,688 13,371 49,746 35,315 44,090 (1,360) 83,307 (4,041) 61,012 341,986 1,312,509 5,997,102 1,157,323 7,154,425 297,986 1,356,509 5,997,102 1,157,323 7,154,425 139,850 1,343,622 14,097 5,558,737 1,158,084 6,716,821 158,136 12,887 (14,097) 438,365 (761) 437,604 $ 3,067,648 $ 3,067,648 $ 4,787,982 75 $ 1,720,334 City of Yuma, Arizona Budgetary Comparison Schedule Yuma Mall Maintenance Special Revenue Fund For the Year Ended June 30, 2014 Budgetary Fund Balance, July 1 Resources (inflows): Taxes Mall Assessments Property Tax - Delinquent Miscellaneous Other Total Revenues Transfers In Budget Original Final $ $ - Amounts Available for Appropriation Charges to Appropriations (outflows): Current: Community Design and Development Mall Maintenance Total Expenditures Total Charges to Appropriations Budgetary Fund Balance, June 30 $ Actual Amounts $ - Variance with Final Budget Positive (Negative) $ - 100,000 - 100,000 - 77,632 3,688 (22,368) 3,688 3,900 103,900 108,910 212,810 3,900 103,900 108,910 212,810 4,409 85,729 109,578 195,307 509 (18,171) 668 (17,503) 212,810 212,810 212,810 212,810 212,810 212,810 195,307 195,307 195,307 17,503 17,503 17,503 - 76 $ - $ - $ - NONMAJOR ENTERPRISE FUNDS Enterprise funds are used to account for activities that are financed and operated in a manner similar to private businesses. The intent of the City Council is that the costs of providing the goods or services be recovered primarily through user charges. Enterprise funds are designed so that creditors, legislators and the general public can evaluate the performance of the municipal enterprise on the same basis as commercial enterprises in the same industry. Solid Waste To record the financial activities of the city-owned and operated residential garbage collection service. Radio Communication Communication Fund. To record the financial activities of the Radio Desert Hills Golf Course To account for the financial activity of the operation of the Desert Hills and Desert Hills Par 3 Municipal Golf Courses. 77 City of Yuma, Arizona Combining Statement of Net Position Nonmajor Proprietary Funds June 30, 2014 Assets Current Assets: Cash and Investments Receivables, Net of Allowance for Uncollectibles: Accounts Receivable Intergovernmental Accrued Interest Inventory, at cost Prepaid Expenses Total Current Assets Noncurrent Assets: Capital Assets: Buildings Improvements Other than Buildings Equipment Gross Capital Assets Less Accumulated Depreciation Captial Assets Net of Depreciation Total Noncurrent Assets Total Assets Liabilities Current Liabilities: Accounts Payable Accrued Payroll and Related Taxes Current Portion-Accrued Compensated Absences Unearned Revenue Total Current Liabilities Payable from Current Assets Noncurrent Liabilities: Accrued Compensated Absences Total Long-Term Liabilities Total Liabilities Net Position Net investment in capital assets Unrestricted (deficit) Total Net Position Enterprise Funds Radio Desert Hills Communication Golf Course Solid Waste $ 1,382,329 516,631 1,148 402 1,900,510 50,738 329,725 380,463 (284,415) $ 122,867 771,100 98,002 30,534 1,022,503 $ Total Nonmajor Proprietary Funds 58,998 $ 1,564,194 16,160 438 63,991 139,587 532,791 772,686 402 161,993 30,534 3,062,600 7,646,742 7,646,742 (5,526,791) 3,102,865 3,290,355 320,166 6,713,386 (4,859,410) 3,102,865 3,341,093 8,296,633 14,740,591 (10,670,616) 96,048 96,048 1,996,558 2,119,951 2,119,951 3,142,454 1,853,976 1,853,976 1,993,563 4,069,975 4,069,975 7,132,575 212,901 13,509 88,708 10,279 40,708 23,328 342,317 47,116 22,530 - 18,590 8,305 32,955 76,947 74,075 85,252 248,940 125,882 173,938 548,760 69,455 69,455 318,395 24,532 24,532 150,414 59,419 59,419 233,357 153,406 153,406 702,166 96,048 1,582,115 $ 1,678,163 2,119,951 872,089 $ 2,992,040 78 1,853,976 (93,770) $ 1,760,206 4,069,975 2,360,434 $ 6,430,409 City of Yuma, Arizona Combining Statement of Revenues, Expenses and Changes in Fund Net Position Nonmajor Proprietary Funds For the Year Ended June 30, 2014 Enterprise Funds Radio Communication Solid Waste Operating Revenues: Intergovernmental Charges for Services Green Fees Cart and Club Rental Pro Shop Sales Restaurant Sales Total Operating Revenues $ Operating Expenses: Operations and Maintenance Depreciation and Amortization Total Operating Expenses 3,325,247 3,325,247 $ 2,920,277 32,016 2,952,293 Operating Income/(Loss) 1,983,116 1,564,406 3,547,522 Total Nonmajor Proprietary Funds Desert Hills Golf Course $ 3,175,815 975,972 4,151,787 1,143,932 286,537 247,177 551,927 2,229,573 $ 1,983,116 4,889,653 1,143,932 286,537 247,177 551,927 9,102,342 3,283,413 177,234 3,460,647 9,379,505 1,185,222 10,564,727 (1,231,074) (1,462,385) 372,954 (604,265) 5,012 20,326 25,338 1,193 (1,266) 1,791 1,718 398,292 (602,547) (21,016) 245,643 - 600,000 - 845,643 (21,016) Change in Net Position 377,276 (356,904) (615,210) (594,838) Net Position-beginning 1,300,887 Non-Operating Revenues/(Expenses): Interest Gain/(Loss) on Disposal of Assets Miscellaneous Revenues Net Non-Operating Revenues Income/(Loss) before Transfers Transfers In Transfers Out Net Position-ending $ 1,678,163 79 861 15,003 15,864 (1,215,210) 3,348,944 $ 2,992,040 7,066 (1,266) 37,120 42,920 (1,419,465) 2,375,416 $ 1,760,206 7,025,247 $ 6,430,409 City of Yuma, Arizona Combining Statement of Cash Flows Nonmajor Proprietary Funds For the Year Ended June 30, 2014 Solid Waste Cash Flow from Operating Activities: Cash Received from Customers Cash Paid to Employees Cash Paid to Suppliers Other Operating Activity Revenue Net Cash Provided by/(used for) Operating Activities $ 3,498,876 (765,786) (2,005,824) 20,326 747,592 Cash Flows from Noncapital Financing Activities: Cash Received from Other Funds Cash Paid to Other Funds Net Cash Provided by/(Used for) Noncapital Financing Activities Cash Flow from Capital and Related Financing Acitivities: Acquisition and Construction of Assets Net Cash Used for Capital and Related Financing Activities Cash Flows from Investing Activities: Receipt of Interest Net Cash Provided by Investing Activities Enterprise Funds Radio Desert Hills Communication Golf Course $ 3,881,001 (393,076) (3,049,063) 1,791 440,653 Cash and Cash Equivalents, July 1 Cash and Cash Equivalents, June 30 Reconciliation of Operating Income/(Loss) to Net Cash Provided by/(used for) Operating Activities: Operating Income/(Loss) Adjustments to Reconcile Operating Income/(Loss) Depreciation and Amortization Expense (Increase)Decrease in Accounts Receivables (Increase)/Decrease in Inventories (Increase)Decrease in Prepaid Items Increase/(Decrease) in Accounts Payable Increase(decrease) in Accrued Wages and Taxes Payable Increase(Decrease) in Due from Other Gov't Units Increase(decrease) in Unearned Revenue Other Operating Activity Revenue Total Adjustments 245,642 - 600,000 - 845,642 (21,016) (21,016) 245,642 600,000 824,626 - (763,250) - (763,250) - (763,250) - (763,250) 1,621 1,621 7,765 7,765 (75,334) (406,816) 650,739 198,201 465,814 1,314,754 58,998 $ 1,564,194 $ 122,867 $ $ (604,265) $ (1,231,074) $ (1,462,385) 975,972 325,174 (7,686) (271,351) 12,713 8,305 1,791 1,044,918 177,234 (10,512) 4,593 17,984 18,305 745 (223) 15,002 223,128 1,185,222 488,291 4,593 (7,297) (110,424) 36,353 745 8,082 37,119 1,642,684 372,954 747,592 $ 440,653 $ 249,440 $ 1,382,329 $ 80 1,130 1,130 731,590 32,016 173,629 389 142,943 5,335 20,326 374,638 Net Cash Provided by/(used for) Operating Activities $ 9,599,460 (2,409,205) (7,047,075) 37,119 180,299 (21,016) 5,014 5,014 Net Increase/(Decrease) in Cash and Cash Equivalents $ 2,219,583 (1,250,343) (1,992,188) 15,002 (1,007,946) Total Nonmajor Proprietary Funds $ (1,007,946) $ 180,299 City of Yuma, Arizona Budgetary Comparison Schedule Water Enterprise Fund (Non-GAAP Budgetary Basis) For the Year Ended June 30, 2014 Budget Original Resources (inflows): Inside City Outside City Commercial Raw Water Meters, Connections and Services Capital Contributions: System Development Capacity Rights Intergovernmental Federal Government Interest Miscellaneous Total Revenues Amounts Available for Appropriation Charges to Appropriations (outflows): Current: Administration Treatment Water Transmission Customer Services Water Transfer Laboratory Facilities Maintenance Environmental Health and Protection Infrastructure Maintenance Capital Outlay: Capital Outlay Capital Projects Debt Service: Principal Retirement Interest and Fiscal Agent Fees Total Expenditures Transfers Out Total Charges to Appropriations Excess/(Deficiency) of Resources Over Charges to Appropriations $ $ 18,495,235 2,191,745 160,000 276,000 Actual Amounts Final 18,495,235 2,191,745 160,000 276,000 $ 19,398,860 2,263,838 145,964 367,297 75,000 1,000,000 75,000 1,000,000 105,480 2,208,533 30,480 1,208,533 12,900 108,500 22,319,380 22,319,380 100,000 12,900 108,500 22,419,380 22,419,380 97,529 76,153 103,909 24,767,563 24,767,563 (2,471) 63,253 (4,591) 2,348,183 2,348,183 2,191,130 6,702,112 1,599,793 1,243,037 80,502 283,078 314,853 - 2,191,130 6,682,012 1,596,193 1,241,037 80,502 263,078 314,853 100,000 - 2,002,015 5,809,393 1,610,666 1,144,482 16,801 197,999 111,408 97,530 62,599 189,115 872,619 (14,473) 96,555 63,701 65,079 203,445 2,470 (62,599) 26,500 4,670,300 72,200 4,670,300 44,179 3,208,132 28,021 1,462,168 5,232,873 5,086,794 27,430,970 62,332 27,493,302 5,232,873 5,086,794 27,530,970 62,332 27,593,302 5,232,886 5,125,757 24,663,847 62,466 24,726,313 (13) (38,963) 2,867,123 (134) 2,866,989 (5,173,922) Reconciliation to Change in Net Position: Capital Outlay Capital Projects Principal Retirement Amortization of Debt Insurance Premium Costs Amortization of Bond Premium Loss on Disposal of Assets Depreciation and Amortization Change in Net Position $ Variance with Final Budget Positive (Negative) $ (5,173,922) 41,250 $ $ $ 44,179 3,208,132 5,232,886 141,855 (11,959) (10,330) (8,682,968) (36,955) NOTE: This exhibit is prepared on the modified accrual basis to correspond with the City's budget practices. It is not intended to present the operations in accordance with generally accepted accounting principles. 81 903,625 72,093 (14,036) 91,297 5,215,172 City of Yuma, Arizona Budgetary Comparison Schedule Wastewater Enterprise Fund (Non-GAAP Budgetary Basis) For the Year Ended June 30, 2014 Budget Original Resources (inflows): Inside City Outside City Contractual/Industrial Services Meters, Connections and Services Capital Contributions: Capacity Rights Wastewater Interceptor Wastewater Trunk Line Charges Interest Miscellaneous Total Revenues Amounts Available for Appropriation Charges to Appropriations (outflows): Current: Administration Treatment Pretreatment Collection Laboratory Facilities Maintenance Infrastructure Maintenance Capital Outlay: Capital Outlay Capital Projects Debt Service: Principal Retirement Interest and Fiscal Agent Fees Total Expenditures Transfers Out Total Charges to Appropriations Excess/(Deficiency) of Resources Over Charges to Appropriations $ $ 11,692,900 910,000 1,744,000 15,500 Final 11,692,900 910,000 1,744,000 15,500 $ 12,052,963 1,085,066 1,646,880 28,013 3,250,000 115,000 15,000 32,300 29,180 17,803,880 17,803,880 3,250,000 115,000 15,000 32,300 29,180 17,803,880 17,803,880 2,590,632 135,567 20,614 139,164 36,150 17,735,049 17,735,049 (659,368) 20,567 5,614 106,864 6,970 (68,831) (68,831) 1,332,341 6,567,360 433,572 1,107,621 264,414 177,277 - 1,332,341 6,525,360 433,572 1,105,221 264,414 177,277 - 1,226,581 5,950,488 385,048 1,097,793 179,523 110,681 9,567 105,760 574,872 48,524 7,428 84,891 66,596 (9,567) 235,000 1,211,000 279,400 1,211,000 125,783 31,229 3,311,955 2,039,437 16,679,977 32,867 16,712,844 3,311,955 2,039,437 16,679,977 32,867 16,712,844 3,311,955 2,039,781 14,468,429 31,927 14,500,356 1,091,036 3,234,693 1,091,036 Reconciliation to Change in Net Position: Capital Outlay Capital Projects Principal Retirement Amortization of Debt Insurance Premium Costs Loss on Disposal of Assets Depreciation and Amortization Change in Net Position $ Actual Amounts Variance with Final Budget Positive (Negative) $ $ 153,617 1,179,771 (344) 2,211,548 940 2,212,488 $ 125,783 31,229 3,311,955 38,800 (3,790) (6,106,782) $ 631,888 NOTE: This exhibit is prepared on the modified accrual basis to correspond with the City's budget practices. It is not intended to present the operations in accordance with generally accepted accounting principles. 82 360,063 175,066 (97,120) 12,513 2,143,657 City of Yuma, Arizona Budgetary Comparison Schedule Solid Waste Enterprise Fund (Non-GAAP Budgetary Basis) For the Year Ended June 30, 2014 Budget Resources (inflows): Charges for Service Collection Fees Interest Miscellaneous Other Total Revenues Original Final Actual Amounts $ 3,049,000 1,400 $ 3,049,000 1,400 $ 3,325,247 5,012 5,200 3,055,600 3,055,600 5,200 3,055,600 3,055,600 20,326 3,350,585 3,350,585 15,126 294,985 294,985 2,780,623 344,083 102,809 3,227,515 20,971 3,248,486 2,780,623 344,083 102,809 3,227,515 20,971 3,248,486 2,568,633 296,124 55,520 2,920,277 21,016 2,941,293 211,990 47,959 47,289 307,238 (45) 307,193 Amounts Available for Appropriation Charges to Appropriations (outflows): Current: Environmental Health and Protection Residential Services Uncontained Waste Recycling Total Expenditures Transfers Out Total Charges to Appropriations Excess/(Deficiency) of Resources Over Charges to Appropriations Variance with Final Budget Positive (Negative) $ (192,886) $ (192,886) 409,292 Reconciliation to Change in Net Position: Depreciation and Amortization $ $ 276,247 3,612 602,178 (32,016) Change in Net Position $ 377,276 NOTE: This exhibit is prepared on the modified accrual basis to correspond with the City's budget practices. It is not intended to present the operations in accordance with generally accepted accounting principles. 83 City of Yuma, Arizona Budgetary Comparison Schedule Radio Communication Enterprise Fund (Non-GAAP Budgetary Basis) For the Year Ended June 30, 2014 Budget Original Resources (inflows): Charges for Service Radio Equipment Fees Intergovernmental Federal Government State Government Budget Authority Reserve Use of Money and Property Interest Miscellaneous Other Total Revenues Transfers In Amounts Available for Appropriation Charges to Appropriations (outflows): Current: Environmental Health Radio Communications Public Safety Capital Outlay Capital Outlay Capital Projects Total Expenditures Total Charges to Appropriations Excess/(Deficiency) of Resources Over Charges to Appropriations Actual Amounts Final Variance with Final Budget Positive (Negative) 1,087,389 1,087,389 1,564,406 3,705,375 123,894 7,749,000 4,194,375 123,894 7,749,000 1,957,281 25,835 - (2,237,094) (98,059) (7,749,000) 1,400 1,400 1,193 (207) 500,000 13,167,058 13,167,058 500,000 13,656,058 13,656,058 1,791 3,550,506 245,643 3,796,149 (498,209) (10,105,552) 245,643 (9,859,909) 1,758,566 1,210,473 1,769,566 1,710,473 1,936,216 1,239,599 (166,650) 470,874 2,790,798 7,749,000 13,508,837 13,508,837 2,790,798 7,749,000 14,019,837 14,019,837 763,249 3,939,064 3,939,064 $ (341,779) $ (363,779) Reconciliation to Change in Net Position: Capital Outlay Loss on Disposal of Assets Depreciation and Amortization Change in Net Position 84 $ (142,915) $ 763,249 (1,266) (975,972) (356,904) 477,017 2,027,549 7,749,000 10,080,773 10,080,773 $ 220,864 City of Yuma, Arizona Budgetary Comparison Schedule Desert Hills Golf Course Enterprise Fund (Non-GAAP Budgetary Basis) For the Year Ended June 30, 2014 Budget Resources (inflows): Green Fees Cart and Club Rental Pro Shop Sales Restaurant Sales Interest Miscellaneous Total Revenues Transfers In Amounts Available for Appropriation Original Final $ 1,144,500 315,951 264,000 528,600 1,000 375 2,254,426 600,000 2,854,426 $ 1,144,500 315,951 264,000 528,600 1,000 375 2,254,426 600,000 2,854,426 1,847,733 646,171 584,884 3,078,788 1,802,383 584,435 620,706 71,264 3,078,788 1,671,115 617,064 929,195 66,039 3,283,413 131,268 (32,629) (308,489) 5,225 (204,625) 3,078,788 3,078,788 3,283,413 (204,625) Charges to Appropriations (outflows): Current: Maintenance Concession Restaurant Facility Maintenance Total Expenditures Total Charges to Appropriations Excess/(Deficiency) of Resources Over Charges to Appropriations Actual Amounts Variance with Final Budget Positive (Negative) $ (224,362) $ $ (224,362) 1,143,932 286,537 247,177 551,927 861 15,003 2,245,437 600,000 2,845,437 (437,976) Reconciliation to Change in Net Assets: Depreciation and Amortization $ (568) (29,414) (16,823) 23,327 (139) 14,628 (8,989) (8,989) $ (213,614) (177,234) Change in Net Assets $ (615,210) NOTE: This exhibit is prepared on the modified accrual basis to correspond with the City's budget practices. It is not intended to present the operations in accordance with generally accepted accounting principles. 85 86 INTERNAL SERVICE FUNDS Internal Service Funds are used to account for the financing of goods and services provided by one department to other departments of the City and to other governmental units, on a costreimbursement basis. Equipment Replacement To account for the associated costs of purchasing vehicles and equipment for rental to other departments. Equipment Maintenance maintenance operations. To record the financial activity of fleet Insurance Reserve To record the financial activity related to insurance and risk retention for liability and casualty issues. Employee Benefits Trust To record the financial activity of a self funded insurance trust fund that covers eligible employees and dependent health, life, and dental claims. Workers Compensation To record the financial activity of a selffunded worker’s compensation insurance trust fund. 87 City of Yuma, Arizona Combining Statement of Net Position Internal Service Funds June 30, 2014 Equipment Replacement Assets Current Assets: Cash and Investments Accounts Receivable Intergovernmental Receivable Accrued Interest Inventory, at cost Prepaid Items $ Total Current Assets Noncurrent Assets: Capital Assets: Land Buildings Improvements Other than Buildings Equipment Less Accumulated Depreciation Total Noncurrent Assets Total Assets Liabilities Liabilities: Current Liabilities: Accounts Payable Accrued Payroll, Taxes and Benefits Payable Current Portion-Accrued Compensated Absences Estimated Claims and Judgements Due to Other Funds Total Current Liabilities Payable Noncurrent Liabilities: Accrued Compensated Absences Total Long-Term Liabilities Total Liabilities Net Position Net investment in capital assets Unrestricted (deficit) Total Net Position 14,895,901 5,943 14,901,844 27,367,495 (20,125,336) 7,242,159 22,144,003 $ Equipment Maintenance $ 8,470 2 616,962 30 625,464 219,610 19,251 222,733 223,010 (212,268) 472,336 1,097,800 Insurance Reserve Employee Benefits Trust Workers Compensation Totals $ 1,359,985 39,359 390 590,603 1,990,337 $ 278,317 278,317 $ 1,837,873 895 109 104,788 1,943,665 $ 18,372,076 48,724 2 6,442 616,962 695,421 19,739,627 1,990,337 278,317 1,943,665 219,610 19,251 222,733 27,590,505 (20,337,604) 7,714,495 27,454,122 6,826 90,529 268,185 - 17,936 383,476 - 17,043 1,580 - - 18,623 6,826 24,607 967,213 1,099,392 2,773 71,801 344,339 - 1,429,195 775,048 2,222,179 27,380 1,500,996 1,742,261 3,672,736 6,826 56,104 56,104 1,155,496 6,181 6,181 350,520 - 2,222,179 62,285 62,285 3,735,021 7,242,159 14,895,018 472,336 (530,032) 1,639,817 278,317 (278,514) 7,714,495 16,004,606 22,137,177 $ (57,696) $ 1,639,817 $ 278,317 $ (278,514) $ 23,719,101 88 City of Yuma, Arizona Combining Statement of Revenues, Expenses and Changes in Fund Net Position Internal Service Funds For the Year Ended June 30, 2014 Operating Revenues: Charges For Services Contributions City Equipment Rental Miscellaneous Total Operating Revenues Operating Expenses: Claims Incurred Premiums to Insurance Carriers Administration Depreciation Total Operating Expenses Operating Income/(Loss) Non-Operating Revenue/(Expenses): Interest Gain on the Sale of Assets Total Non-Operating Revenues Income/(Loss) before Transfers Change in Net Position Net Position, Beginning Net Position, Ending Employee Benefits Trust Equipment Replacement Equipment Maintenance Insurance Reserve $ $ 3,425,673 $ 1,740,189 1,845,650 206 1,845,856 4,928 3,430,601 2,143 1,742,332 - 1,161,395 11,244 1,172,639 1,161,395 1,845,650 18,521 8,191,428 451,098 1,617,580 2,068,678 (222,822) 3,843,532 27,239 3,870,771 (440,170) 342,232 583,212 431,046 1,356,490 385,842 - 1,048,478 154,538 34,270 1,237,286 (64,647) 1,390,710 737,750 4,759,946 1,644,819 8,533,225 (341,797) - 78,619 24,459 103,078 - (119,744) (119,744) 22,256,921 $ 22,137,177 - $ - Totals $ 5,165,862 5,148 5,148 1,306 1,306 (163) (163) (440,170) 390,990 1,306 (64,810) (232,428) (440,170) 390,990 1,306 (64,810) (232,428) 1,248,827 277,011 (213,704) 23,951,529 $ 1,639,817 $ 278,317 (278,514) $ 23,719,101 382,474 $ $ Workers Compensation (57,696) 89 $ 84,910 24,459 109,369 City of Yuma, Arizona Combining Statement of Cash Flows Internal Service Funds For the Year Ended June 30, 2014 Equipment Replacement Cash Flows from Operating Activities: Cash Received from Customers Cash Paid to Employees Cash Paid to Suppliers Cash Paid For Operating Expenses Net Cash Flows Provided by/(Used for) Operating Activities $ $ 1,394,758 Cash Flows from Noncapital Financing Activities: Cash Received from Other Funds Cash Paid to Other Funds Net Cash Flows Provided by/(Used for) Noncapital Financing Activities Cash Flows from Capital and Related Financing Activities: Proceeds from Sale of Capital Assets Payments for Capital Acquisitions Net Cash Flows Used for Capital and Related Financing Activities Cash Flows from Investing Activities: Receipt of Interest Net Cash Flows Provided by Investing Activities Net Increase/(Decrease) in Cash and Cash Equivalents Cash and Cash Equivalents, July 1 Cash and Cash Equivalents, June 30 1,845,856 (451,098) Equipment Maintenance 3,432,104 (984,388) (2,448,247) - $ 1,743,536 (76,441) (1,081,273) (531) Employee Benefits Trust Workers Compensation $ $ 585,822 (93) (93) 1,172,980 (803,773) Totals $ 369,207 8,194,476 (1,060,829) (2,448,340) (2,336,144) 2,349,163 - - - - 775,048 (1,113,364) 775,048 (1,113,364) - - - - (338,316) (338,316) 60,668 (2,429,188) 420 - - - - 61,088 (2,429,188) (2,368,520) 420 - - - (2,368,100) 29 29 (82) 5,014 5,014 590,836 81,725 81,725 (892,037) 15,787,938 $ Insurance Reserve 14,895,901 82 $ - $ (440,170) 1,474 1,474 1,381 (273) (273) 30,618 769,149 276,936 $ 1,359,985 $ 278,317 $ $ $ $ 87,969 87,969 (269,284) 1,807,255 18,641,360 1,837,873 $ 18,372,076 Reconciliation of Operating Income/(Loss) to Net Cash Provided by/(Used for) Operating Activities: Operating Income/(Loss) Adjustments to Reconcile Operating Income/(Loss) to Net Cash Provided by/(Used for) Operating Activities: Depreciation Expense (Increase)/Decrease in Accounts Receivable (Increase)/Decrease in Inventory (Increase)/Decrease in Prepaid Items Increase/(Decrease) in Accounts Payable Increase/(Decrease) in Payroll Liabilities Increase/(Decrease) in Claims Incurred but Not Reported Total Adjustments Net Cash Provided by/(Used for) Operating Activities $ $ (222,822) 385,842 - (64,647) $ (341,797) 1,617,580 - 27,239 487,555 127,164 90 (198,168) (4,241) 1,204 (44,961) 237,482 - (93) - 341 (12,829) (13,480) - 1,644,819 489,100 127,164 (57,700) 25,741 (4,241) 1,617,580 439,639 6,255 199,980 (93) 459,822 433,854 466,077 2,690,960 1,394,758 $ 90 (531) $ 585,822 $ (93) $ 369,207 $ 2,349,163 City of Yuma, Arizona Budgetary Comparison Schedule Equipment Replacement Internal Service Fund (Non-GAAP Budgetary Basis) For the Year Ended June 30, 2014 Budget Original Resources (inflows): Charges for Services Interest Miscellaneous Total Revenues Amounts Available for Appropriation Charges to Appropriations (outflows): Current Administration Capital Outlay Total Expenditures Total Charges to Appropriations Excess of Resources Over Charges to Appropriations $ Actual Amounts Final 1,845,647 37,000 1,882,647 1,882,647 $ 7,344 4,048,187 4,055,531 4,055,531 1,845,647 37,000 1,882,647 1,882,647 7,344 4,028,187 4,035,531 4,035,531 $ (2,172,884) Reconciliation to Change in Net Position: Capital Outlay Gain on Sale of Assets Depreciation and Amortization Change in Net Position $ (2,152,884) $ 1,845,650 78,619 206 1,924,475 1,924,475 Variance with Final Budget Positive (Negative) $ 451,098 2,419,198 2,870,296 2,870,296 (945,821) 3 41,619 206 41,828 41,828 (443,754) 1,608,989 1,165,235 1,165,235 $ 1,207,063 2,419,198 24,459 (1,617,580) $ (119,744) NOTE: This exhibit is prepared on the modified accrual basis to correspond with the City's budget practices. It is not intended to present the operations in accordance with generally accepted accounting principles. 91 City of Yuma, Arizona Budgetary Comparison Schedule Equipment Maintenance Internal Service Fund (Non-GAAP Budgetary Basis) For the Year Ended June 30, 2014 Budget Original Resources (inflows): Charges for Services Miscellaneous Interest Total Revenues $ Amounts Available for Appropriation Charges to Appropriations (outflows): Current Administration Total Expenditures Total Charges to Appropriations Excess of Resources Over Charges to Appropriations 3,625,673 100 3,625,773 3,625,773 $ 3,715,263 3,715,263 3,715,263 $ (89,490) Reconciliation to Change in Net Position: Depreciation and Amortization Change in Net Position Actual Amounts Final 3,625,673 100 3,625,773 3,625,773 $ 3,715,263 3,715,263 3,715,263 $ 3,425,673 4,928 3,430,601 3,430,601 Variance with Final Budget Positive (Negative) $ 3,843,532 3,843,532 3,843,532 (89,490) (412,931) $ (200,000) 4,928 (100) (195,172) (195,172) (128,269) (128,269) (128,269) $ (323,441) (27,239) (440,170) NOTE: This exhibit is prepared on the modified accrual basis to correspond with the City's budget practices. It is not intended to present the operations in accordance with generally accepted accounting principles. 92 City of Yuma, Arizona Budgetary Comparison Schedule Insurance Reserve Internal Service Fund (Non-GAAP Budgetary Basis) For the Year Ended June 30, 2014 Budget Original Resources (inflows): Charges for Services Miscellaneous Interest Total Revenues $ Amounts Available for Appropriation Charges to Appropriations (outflows): Current Premiums to Insurance Carriers Claims Incurred Administration Total Expenditures Total Charges to Appropriations Excess of Resources Over Charges to Appropriations 1,740,190 25,000 1,000 1,766,190 1,766,190 $ 585,116 247,000 951,432 1,783,548 1,783,548 $ (17,358) Reconciliation to Change in Net Position: Change in Net Position Actual Amounts Final 1,740,190 25,000 1,000 1,766,190 1,766,190 $ 585,116 247,000 951,432 1,783,548 1,783,548 $ (17,358) 1,740,189 2,143 5,148 1,747,480 1,747,480 Variance with Final Budget Positive (Negative) $ 583,212 342,232 431,046 1,356,490 1,356,490 $ 390,990 $ 390,990 (1) (22,857) 4,148 (18,710) (18,710) 1,904 (95,232) 520,386 427,058 427,058 $ 408,348 NOTE: This exhibit is prepared on the modified accrual basis to correspond with the City's budget practices. It is not intended to present the operations in accordance with generally accepted accounting principles. 93 94 STATISTICAL SECTION 95 96 STATISTICAL SECTION This part of the City of Yuma's comprehensive annual financial report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the government's overall Contents Page Financial Trends 98 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 106 These schedules contain information to help the reader assess the City's most significant local revenue source - sales tax. Debt Capacity 108 These schedules present information to help the reader assess the affordability of the City's current levels of outstanding debt and it's ability to issue additional debt in the future. Demographic and Economic Information 114 These schedules offer demographic and economic indicators to help the reader understand the environment within which the City's financial activities take Operating Information 117 These schedules contain service and infrastructure data to help the reader understand how the information in the City's financial report relates to the services the City provides and the activities it performs. Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive annual financial reports for the respective year. 97 City of Yuma, Arizona Net Position by Component Last Ten Fiscal Years (amounts expressed in thousands) 2005 2006 2007 2008 Fiscal Year 2009 2010 2011 2012 2013 2014 As restated 98 Governmental activities Net investment in capital assets Restricted Unrestricted Total governmental activites net position $ 111,268 330 57,707 $ 169,305 $ 130,176 24,820 42,605 $ 197,601 $ 160,214 12,991 43,638 $ 216,844 $ 169,403 17,952 45,354 $ 232,709 $ 129,228 70,389 38,439 $ 238,056 $ 192,145 14,762 40,261 $ 247,168 $ 196,837 15,773 44,357 $ 256,967 $ 209,377 24,835 36,851 $ 271,063 $ 208,428 22,456 39,115 $ 269,999 $ 197,997 19,166 43,244 $ 260,407 Business-type activities Net investment in capital assets Restricted Unrestricted Total business-type activites net position $ 105,944 27,122 $ 133,066 $ 119,734 26,569 $ 146,303 $ 154,054 7,587 $ 161,641 $ 151,032 151 24,079 $ 175,262 $ 158,367 1,952 27,344 $ 187,663 $ 160,883 3,754 29,027 $ 193,664 $ 166,782 5,556 31,699 $ 204,037 $ 164,295 7,357 37,842 $ 209,494 $ 163,246 9,009 43,362 $ 215,617 $ 159,458 9,009 46,877 $ 215,344 Primary government Net investment in capital assets Restricted Unrestricted Total primary government net position $ 217,212 330 84,829 $ 302,371 $ 249,910 24,820 69,174 $ 343,904 $ 314,268 12,991 51,225 $ 378,485 $ 320,435 18,103 69,433 $ 407,971 $ 287,595 72,341 65,783 $ 425,719 $ 353,028 18,516 69,288 $ 440,832 $ 363,619 21,329 76,056 $ 461,004 $ 373,672 32,192 74,693 $ 480,557 $ 371,674 31,465 82,477 $ 485,616 $ 357,455 28,175 90,121 $ 475,751 City of Yuma, Arizona Changes in Net Position Last Ten Fiscal Years (amounts expressed in thousands) 2005 99 Expenses Governmental activities: General government Public Safety Streets Parks, Recreation and Culture Environmental Health and Protection Community Design and Development Interest on Long-Term Debt Total governmental activites expenses Business-type activities: Water Wastewater Solid Waste Radio Communications Golf Courses Total business-type activites expenses Total primary government expenses Program Revenues Governmental activities: Charges for Services Building Inspection Fees Developer Charges Ambulance Services Police Services Other Charges Operating Grants and Contributions Capital Grants and Contributions Total governmental activities program revenues Business-type activities: Charges for Services Metered Water Sales Wastewater Charges Radio Communications Solid Waste Charges Green Fees and Concessions Other Charges Capital Grants and Contributions Total business-type activities program revenues Total primary government program revenues $ $ $ $ 2006 13,010 10,403 2,641 26,054 $ 105,572 14,562 11,538 2,676 28,776 $ 116,383 18,389 13,270 2,889 34,548 $ 133,972 20,754 13,859 2,819 37,432 $ 139,366 $ 1,023 3,995 605 8,768 3,568 1,747 19,706 $ $ $ $ $ $ $ 985 4,517 805 8,407 2,661 5,341 22,716 17,522 10,387 2,189 1,390 11,249 42,737 65,453 $ $ 11,875 38,511 18,943 14,353 4,604 5,807 5,331 99,424 710 6,657 764 8,916 2,294 5,000 24,341 21,027 13,126 2,140 1,181 8,874 46,348 70,689 $ Fiscal Year 2010 11,456 8,750 2,514 22,720 91,534 14,797 9,081 2,191 1,393 11,025 38,487 61,211 10,919 36,067 13,384 15,400 2,098 6,791 2,948 87,607 2009 $ 1,019 3,520 698 8,968 2,840 5,679 22,724 $ 2008 7,117 30,707 9,061 9,841 3,608 5,438 3,042 68,814 12,297 8,000 1,994 1,221 11,657 35,169 54,875 9,124 33,057 12,326 12,173 3,410 6,529 2,899 79,518 2007 $ 11,559 41,080 15,966 16,282 4,969 5,486 6,592 101,934 390 4,911 865 7,607 1,807 4,783 20,363 22,463 13,372 2,027 1,098 9,924 48,884 69,247 $ $ 10,563 39,224 13,969 13,863 4,905 4,981 6,291 93,796 20,277 13,673 2,496 36,446 130,242 384 2,674 821 7,491 3,659 5,944 20,973 21,651 13,699 1,964 1,041 3,969 42,324 63,297 2011 $ $ $ $ 9,684 40,232 14,536 13,804 1,538 5,007 5,803 90,604 20,555 13,882 2,902 2,377 39,716 130,320 2012 $ $ 12,534 41,735 12,741 14,226 804 4,521 5,461 92,022 23,353 16,191 2,948 2,403 44,895 136,917 307 1,589 477 567 5,775 3,965 19,145 31,825 2013 $ $ $ 10,345 43,051 14,980 12,787 156 5,134 5,153 91,606 23,227 16,165 3,213 4,663 2,469 49,737 141,343 333 4,369 471 6,936 4,968 3,245 20,322 $ 413 1,419 3,830 617 6,082 3,980 1,744 18,085 21,598 14,854 3,147 1,890 961 7,391 49,841 70,163 20,710 21,233 14,485 14,625 1,714 3,266 3,301 1,919 2,152 775 562 9,071 7,776 50,226 51,363 $ 82,051 $ 69,448 Continued on next page 2014 $ 10,335 46,585 25,265 13,606 89 5,167 4,781 105,828 24,762 17,073 3,085 4,153 3,474 52,547 $ 158,375 $ $ 545 2,326 2,490 701 5,708 3,305 577 15,652 21,809 14,785 1,564 3,325 2,230 670 7,044 51,427 67,079 City of Yuma, Arizona Changes in Net Position Last Ten Fiscal Years (amounts expressed in thousands) 2005 Net (expense)/revenue Governmental activities Business-type activities Total primary government net expense $ (49,109) 12,449 $ (36,659) 100 General Revenues and Other Changes in Net Position Governmental activities: Property taxes $ 6,076 Sales taxes 32,795 Franchise taxes 2,105 Shared revenues 25,462 Grants and contributions not restricted to specific programs 1,673 Unrestricted investment earnings 1,370 Gain from sale of fixed assets 307 Transfers (2,124) Total governmental activities 67,664 Business-type activities: Investment earnings 691 Transfers 2,124 Total business-type activities 2,815 Total primary government $ 70,479 Change in Net Position Governmental activities Business-type activities Total primary government $ $ 18,553 15,264 33,817 2006 $ $ $ $ $ $ 2007 (56,794) 12,434 (44,361) $ 6,832 36,557 3,116 28,226 $ $ (64,891) 13,961 (50,930) 7,430 39,616 2,678 30,558 Fiscal Year 2010 2008 2009 $ (75,083) 11,800 $ (63,283) $ (81,571) 11,452 $ (70,119) $ $ $ $ 8,250 39,478 2,893 32,788 8,856 36,857 3,013 31,330 $ 2011 (72,823) 5,878 (66,945) $ 9,498 34,177 3,010 28,239 $ $ 2012 (70,282) 10,125 (60,157) $ 9,986 34,644 3,002 25,379 $ $ 2013 (60,197) 5,331 (54,866) $ 10,099 36,304 3,059 23,936 $ $ 2014 (73,521) 1,626 (71,895) $ 9,549 37,624 3,043 25,917 $ $ (90,176) (1,120) (91,296) 9,451 37,994 3,010 26,552 7,826 2,190 348 (4) 85,091 115 4,097 (363) 84,131 2,600 4,842 (96) 90,755 3,895 2,872 95 86,918 5,776 1,139 95 81,934 5,929 1,001 259 126 80,326 930 (37) 74,291 796 (122) 76,807 545 (730) 76,822 798 4 802 85,893 1,016 363 1,379 85,510 1,916 96 2,012 92,767 1,045 (95) 950 87,868 217 (95) 122 82,056 130 (126) 4 80,330 89 37 126 74,417 26 122 148 76,955 222 730 952 77,774 28,296 13,236 41,532 $ $ $ 19,243 15,338 34,581 $ $ $ 15,865 13,620 29,485 $ $ $ 5,347 12,402 17,749 $ $ $ 9,112 6,000 15,112 $ $ $ 10,044 10,128 20,172 $ $ $ 14,095 5,457 19,552 $ $ $ 3,391 1,669 5,060 $ $ (13,354) (168) $ (13,522) Concluded City of Yuma, Arizona Fund Balances of Governmental Funds Last Ten Fiscal Years (amounts expressed in thousands) 2005 General Fund Reserved Unreserved Nonspendable Committed Assigned Unassigned Total General Fund 101 All other Governmental funds Reserved Unreserved, reported in: Special revenue funds Capital projects funds Nonspendable Restricted Committed Assigned Total all other governmental funds $ 296 19,704 - 2006 $ 614 21,125 - 2007 $ 309 19,893 - Fiscal Year 2009 2010 2008 $ 277 18,608 - $ 262 15,493 - $ 156 18,796 - 2011 $ 103 2,383 88 19,060 2012 $ 169 1,864 868 15,655 2013 $ 187 935 18,693 2014 $ 178 17,732 $ 20,000 $ 21,739 $ 20,202 $ 18,885 $ 15,755 $ 18,952 $ 21,634 $ 18,556 $ 19,815 $ 17,910 $ $ $ $ $ $ $ $ $ $ 339 535 513 543 552 553 - - - - 17,036 1,104 - 19,908 5,976 - 12,892 926 - 8,791 67,732 - 6,876 47,349 - 7,848 31,267 - 141 2,388 34,441 2,037 - - - 18 24,834 11,235 633 19 22,456 7,252 - 16 19,167 7,018 - $ 18,479 $ 26,418 $ 14,331 $ 77,066 $ 54,777 $ 39,668 $ 39,007 $ 36,720 $ 29,727 $ 26,201 Notes: For FY 2011 GASB Statement No 54 was implemented. See Note I-E, Sec 9 of the Notes to Basic Financial Statements. City of Yuma, Arizona Changes in Fund Balances of Governmental Funds Last Ten Fiscal Years (amounts expressed in thousands) Fiscal Year 2006 2007 2008 2009 2010 2005 2011 2012 2013 2014 Revenues Taxes Licenses and permits Intergovernmental Charges for services Fines and forfeitures Special Assessments Use of money and property Contributions and donations Miscellaneous Total revenues $ 41,078 3,416 30,729 7,937 806 1,971 84 1,152 87,173 $ 46,474 3,836 36,044 7,737 863 649 2,809 80 548 99,040 $ 49,686 2,845 37,916 8,804 1,039 679 4,374 78 624 106,045 $ 50,503 2,068 39,238 11,599 1,143 914 5,358 65 633 111,521 $ 48,569 1,363 37,064 8,913 1,238 949 3,309 97 1,646 103,148 $ 46,561 1,413 36,984 7,007 1,437 817 1,752 85 763 96,819 $ 47,606 1,292 32,510 7,055 1,484 1,039 1,665 77 2,442 95,170 $ 49,450 1,288 33,173 4,160 1,550 1,089 1,365 47 493 92,615 $ 50,282 1,723 30,780 7,293 1,526 1,134 819 69 1,053 94,679 $ 50,425 1,880 30,254 7,086 1,210 1,183 971 88 456 93,553 5,033 29,296 4,899 8,534 3,014 5,344 21,151 7,185 31,862 5,626 9,727 3,365 6,422 22,688 7,641 35,014 7,155 11,022 3,551 6,698 41,449 9,723 37,874 8,913 11,547 4,757 5,726 51,148 9,575 37,908 9,716 11,857 4,781 5,370 35,734 7,740 35,234 8,195 10,619 4,480 4,870 25,249 6,969 36,285 8,186 10,171 1,556 4,899 13,659 9,451 38,475 7,945 10,688 733 4,458 12,666 9,409 40,769 7,662 10,964 104 5,134 11,792 8,964 42,938 7,592 11,200 72 5,096 8,702 3,447 3,032 4,209 2,890 3,837 2,939 8,312 5,885 7,075 6,646 6,315 6,764 7,680 5,858 8,010 5,516 8,350 5,209 8,700 4,885 83,750 93,974 119,306 143,885 128,662 109,466 95,263 97,942 99,393 98,149 3,423 5,066 (13,261) (32,364) (25,514) (12,647) (93) (5,327) (4,714) (4,596) 307 20,219 (23,398) 3,875 742 25,016 (25,021) 38,410 (38,773) 93,686 29,685 (29,589) 16,213 (16,118) 30,017 (29,378) 14,564 (14,468) 14,675 (14,548) 14,522 (14,559) 12,772 (12,893) 13,474 (14,204) (2,872) 4,612 (37) (121) (730) (4,835) $ (5,326) 15.5% 15.2% Expenditures 102 General government Public Safety Streets Parks, Recreation and Culture Environmental Health and Protection Community Design and Development Capital Outlay Debt Service Principal Interest and fiscal agent fees Total expenditures Excess of revenues over (under) expenditures Other financing sources (uses) Proceeds from long-term debt Sale of real property Payment to Refunded Bond Escrow Transfers in Transfers out Total other financing sources (uses) Net change in fund balances Debt service as a percentage of noncapital expenditures $ 551 10.4% $ 9,678 10.0% (363) $ 13,624 8.7% 93,782 95 $ 61,418 $ 25,419 15.3% 14.8% 735 $ (11,912) 15.5% 127 $ 34 16.6% $ 5,364 15.9% $ City of Yuma, Arizona Governmental Funds Tax Revenues by Source Last Ten Fiscal Years Public Enterprise In-Lieu Mall District Levy 103 Fiscal Year Property Tax General Sales Tax 2005 6,084,442 17,165,647 8,581,364 3,431,379 3,374,350 2,105,116 242,000 93,863 41,078,161 2006 6,699,038 19,087,873 9,542,314 3,815,628 3,866,902 3,116,225 244,610 101,821 46,474,411 2007 7,278,233 20,672,520 10,334,503 4,132,396 4,232,008 2,678,454 244,610 113,345 49,686,069 2008 8,026,861 20,479,641 10,238,080 4,093,839 4,424,358 2,893,077 242,000 105,394 50,503,250 2009 8,545,562 18,961,780 9,479,279 3,790,422 4,383,419 3,013,453 242,000 154,174 48,570,089 2010 9,256,633 17,461,635 8,729,333 3,490,546 4,253,079 3,009,794 242,000 117,798 46,560,818 2011 9,740,940 17,635,454 8,816,228 3,525,292 4,425,556 3,001,939 242,000 218,925 47,606,334 2012 9,944,517 18,470,938 9,233,899 3,692,304 4,665,296 3,058,634 242,000 142,151 49,449,739 2013 9,495,271 19,248,864 9,622,796 3,847,810 4,652,121 3,043,054 252,413 119,403 50,281,732 2014 9,339,855 19,517,306 9,756,994 3,901,471 4,576,061 3,009,904 242,000 81,320 50,424,911 City Road Sales Tax Public Safety Two Percent Sales Tax Tax Utility Franchise Total City of Yuma, Arizona Governmental Funds Intergovernmental Shared Revenues Last Ten Fiscal Years Fiscal Year Sales Tax Revenue Sharing Auto In-Lieu Highway Users Local Transportion Assistance Grants and Others* Total 104 2005 7,196,762 7,141,392 3,067,961 7,627,177 428,520 5,230,199 30,692,011 2006 8,292,930 8,133,573 3,391,236 7,980,673 427,528 7,818,092 36,044,032 2007 8,437,831 10,079,129 3,476,885 8,137,895 425,850 7,357,643 37,915,233 2008 8,183,395 12,518,215 3,518,863 8,144,889 423,058 6,448,868 39,237,288 2009 7,105,468 13,355,612 3,445,491 7,029,312 394,161 5,734,617 37,064,661 2010 6,553,759 11,530,342 3,302,490 6,626,027 226,308 8,744,867 36,983,793 2011 6,856,996 8,692,400 3,250,436 6,503,532 75,764 7,131,364 32,510,492 2012 7,272,049 7,854,670 3,108,562 5,700,428 - 9,237,197 33,172,906 2013 7,600,328 9,506,288 2,948,529 5,862,202 - 4,862,601 30,779,948 2014 7,507,882 9,656,745 3,111,124 6,276,058 - 3,702,063 30,253,872 *See 'Intergovernmental Revenues - Grants and Others' for detail information. City of Yuma, Arizona Intergovernmental Revenues - Grants and Other Last Ten Fiscal Years Federal Housing/Urban Development (CDBG) State of Arizona 105 Fiscal Year Justice 2005 1,233,650 465,209 594,924 80,301 2,485,908 79,123 2006 925,898 1,404,369 1,044,705 251,898 3,264,509 120,555 2007 524,591 417,782 1,334,775 - 4,090,532 2008 1,001,408 621,480 899,272 - 2009 583,702 1,469,327 1,121,334 2010 252,169 1,446,751 2011 271,296 2012 Interior Other HUD Other Parks Commerce Other Local Government 291,084 13,000 376,323 388,547 28,288 7,818,092 432,498 130,213 233,689 59,422 134,141 7,357,643 1,335,165 505,838 1,844,645 214,649 26,411 - 6,448,868 - 2,176,628 - 297,024 5,393 81,210 - 5,734,617 1,167,310 - 5,336,400 741,740 1,059,135 255,855 4,165,343 373,294 635,092 786,120 87,292 2,501,119 5,125 - 2013 459,826 726,689 1,207,608 1,855,100 10,400 2014 700,071 64,489 1,249,005 1,465,997 10,000 93,283 - 1,840 - - 533,859 - 637,996 2,893,392 1,588,327 296,263 240,044 66,670 - 62,592 29,549 - Total - 5,607 - Transportation 931 5,230,199 8,744,867 - 7,131,364 367,436 9,237,197 - 4,862,601 27,077 3,702,063 City of Yuma, Arizona Taxable Sales by Category Last Ten Fiscal Years (amounts expressed in thousands) 2005 Mining Construction $ 2006 1 $ 2007 3 $ Fiscal Years 2009 2010 2008 25 $ 155 $ 6 $ 2011 82 $ 2012 6 $ 2013 44 $ 2014 20 $ 24 228,801 235,643 254,740 249,315 207,592 118,996 121,132 190,490 190,260 174,693 53,176 60,054 57,632 59,931 48,964 44,764 50,676 38,167 50,539 43,626 145,454 173,224 186,420 207,693 206,089 207,112 197,764 194,646 197,687 206,056 29,635 35,498 34,732 22,480 33,785 35,334 42,580 38,720 36,578 39,897 Retail Trade 925,936 1,024,886 1,088,053 1,089,001 1,001,579 962,699 973,426 987,416 1,036,092 1,068,106 Restaurants and Bars 123,683 143,594 157,866 162,560 162,404 157,024 160,742 168,358 172,056 174,309 Finance, Insurance and Real Estate 97,875 117,161 143,725 132,593 115,857 116,046 123,876 129,208 129,208 131,450 Hotels and Other Lodging Accomodation 34,930 37,333 39,360 33,642 36,093 29,502 29,507 33,368 32,054 29,049 Services 44,921 48,639 58,050 52,012 50,858 43,356 45,208 45,804 51,404 49,649 Arts, Entertainment, Government and All Others Not Specified 31,963 32,542 46,423 38,503 32,743 31,055 18,434 20,670 22,871 34,656 $ 1,716,375 $ 1,908,577 $ 2,067,026 $ 2,047,885 $ 1,895,970 $ 1,745,970 $ 1,763,351 $ 1,846,891 $ 1,918,769 $ 1,951,516 Manufacturing Transportation, Communications, and Utilities Wholesale Trade 106 City direct sales tax rate 1.70% 1.70% 1.70% 1.70% 1.70% 1.70% 1.70% Source: Arizona Department of Revenue Note: During fiscal 2004, the Department of Revenue implemented a new collection system with a revised reporting scheme. Accordingly, certain classifications have been combined for comparison purposes. 1.70% 1.70% Revised 1.70% City of Yuma, Arizona Direct and Overlapping Sales Tax Rates Last Ten Fiscal Years Fiscal Year City Sales Tax Rate City Hospitality Sales Tax Rate Yuma County Arizona State 107 2005 1.70% 2.00% 1.60% 5.60% 2006 1.70% 2.00% 1.60% 5.60% 2007 1.70% 2.00% 1.10% 5.60% 2008 1.70% 2.00% 1.10% 5.60% 2009 1.70% 2.00% 1.10% 5.60% 2010 1.70% 2.00% 1.10% 6.60% 2011 1.70% 2.00% 1.10% 6.60% 2012 1.70% 2.00% 1.10% 6.60% 2013 1.70% 2.00% 1.10% 5.60% 2014 1.70% 2.00% 1.112% 5.60% Source: Arizona Department of Revenue City of Yuma, Arizona Ratio of Outstanding Debt by Type Last Ten Fiscal Years Governmental Activities Municipal Property Special Corporation Assessment Bonds Bonds Business-Type Activities Municipal Property General Long-term Corporation Obligation Contracts Bonds Bonds Payable 108 Total Primary Government Percentage of Personal Income* 61,072,113 140,070,113 3.67% 773 8,585,000 74,110,111 151,859,111 3.73% 810 7,535,000 84,154,117 156,606,117 3.63% 822 127,925,000 6,420,000 80,379,511 367,644,511 7.89% 1,892 - 123,090,000 5,250,000 76,473,462 349,503,462 7.22% 1,808 6,815,000 - 120,130,000 4,040,000 72,431,684 334,371,684 6.69% 1,708 125,665,000 5,745,000 - 117,025,000 2,765,000 68,249,441 319,449,441 6.03% 1,623 - 119,055,000 4,625,000 - 113,765,000 1,420,000 63,921,846 302,786,846 5.56% 1,507 2013 - 112,165,000 3,460,000 - 110,340,000 - 59,443,795 285,408,795 5.29% 1,427 2014 - 104,980,000 2,245,000 - 106,755,000 - 54,810,083 268,790,083 NA Fiscal Year General Obligation Bonds Long-term Contracts Payable 2005 - 60,420,000 7,280,000 1,723,000 - 9,575,000 2006 - 57,765,000 10,475,000 924,000 - 2007 - 55,035,000 9,765,000 117,000 - 2008 - 144,100,000 8,820,000 - 2009 - 136,850,000 7,840,000 2010 - 130,955,000 2011 - 2012 Note: Details regarding the city's outstanding debt can be found in the notes to the financial statements. *See the Schedule of Demographic and Economic Statistics on page 114 for personal income and population data. Per Capita* NA City of Yuma, Arizona Ratio of General Bonded Debt to Assessed Value and General Bonded Debt Per Capita Last Ten Fiscal Years Fiscal Year Population Assessed Value General Obligation Debt (Business-type Activities) Ratio of General Bonded Debt to Assessed Value General Bonded Debt per Capita 109 2005 86,070 329,526,546 9,575,000 2.9% 111 2006 88,775 367,376,807 8,585,000 2.3% 97 2007 92,160 468,531,273 7,535,000 1.6% 82 2008 93,212 572,280,942 6,420,000 1.1% 69 2009 93,719 699,754,765 5,250,000 0.8% 56 747,149,498 4,040,000 0.5% 45 733,033,525 2,765,000 0.4% 30 666,827,282 1,420,000 0.2% 15 2010 2011 2012 2013 2014 Source: 90,660 Revised 91,359 Revised 93,814 * Revised 93,013 * Revised 91,923 * 625,801,724 - 0.0% - 632,734,838 - 0.0% - Yuma County Assessor U.S. Department of Commerce * Estimated projections by US Dept of Commerce NOTE: General obligation debt issued for utility system improvements is paid through user charges. No property taxes are levied for this purpose. City of Yuma, Arizona Computation of Direct and Overlapping Debt June 30, 2014 Debt Jurisdiction City of Yuma Outstanding Allocable to City of Yuma Percent Amount $ 268,790,083 100.00% $ 268,790,083 Yuma County 7,216,000 50.90% 3,672,944 Yuma County Jail District 6,020,000 50.90% 3,064,180 44,310,000 50.90% 22,553,790 Yuma County Special Assessment District 3,369,878 50.90% 1,715,268 Yuma County Community College District 59,940,000 50.90% 30,509,460 Yuma Union High School District No. 70 22,135,000 55.00% 12,174,250 Yuma Union High School District No. 70 17,190,000 55.00% 9,454,500 9,915,000 65.00% 6,444,750 Yuma County Library District 110 Yuma School District No. 13 Total Overlapping Debt Source: Yuma County Finance Department Yuma County Assessor's Office Arizona Western College (School district percent estimated) Note: Valuation applicable percentage obtained from Yuma County Treasurer's Office $ 89,589,142 City of Yuma, Arizona Legal Debt Margin Information June 30, 2014 (amounts expressed in thousands) 2005 Fiscal Year 2010 2006 2007 2008 2009 $ 73,475 22,043 $ 572,281 114,456 $ 114,456 34,337 $ 139,951 41,985 9,575 - 8,585 - 7,535 - 6,420 - Legal debt margin Water, Sewer, Lights, Parks (20%) $ 57,320 All Others (6%) 19,772 $ 67,890 22,043 $ 86,171 28,112 $ 108,036 34,337 Debt Limit Water, Sewer, Lights, Parks (20%) $ 65,905 All Others (6%) 19,772 Total net debt applicable to limit Water, Sewer, Lights, Parks (20%) All Others (6%) 111 Total net debt applicable to the limit as a percentage of debt limit Water, Sewer, Lights, Parks (20%) All Others (6%) 14.53% 0.00% 11.68% 0.00% 1.32% 0.00% 5.61% 0.00% 2011 2012 2013 2014 $ 149,430 44,829 $ 146,607 43,982 $ 133,365 40,010 $ 125,160 37,548 $ 126,547 37,964 5,250 - 4,040 - 2,765 - 1,420 - $ 134,701 41,985 $ 145,390 44,829 $ 143,842 - $ 131,945 40,010 3.75% 0.00% 2.70% 0.00% 1.89% 0.00% 1.06% 0.00% $ 125,160 37,548 $ 126,547 37,964 0.00% 0.00% 0.00% 0.00% Legal Debt Margin Calculation for Fiscal Year 2014 General Obligation Bonds 2013 Tax Year Secondary Assessed Valuation Outstanding General Obligation Debt: Project 1997 Total General Obligation Debt $ 632,735 Water, Sewer, Lights, Parks (20%) All Others (6%) $ 126,547 $ $ 126,547 (1) Under the Arizona Constitution, cities may issue General Obligation Bonds for purposes of water, sewer, artificial light and parks, open space preserves, playgrounds and recreational facilities up to an amount not exceeding 20% of secondary assessed valuation. (2) Under the Arizona Constitution, cities may issue General Obligation Bonds for all purposes other than those listed in (1) above up to an amount not to exceed 6% of secondary assessed valuation. 37,964 - $ 37,964 City of Yuma, Arizona Schedule of Municipal Property Corporation Debt Service Requirements to Maturity and Coverage Series 2007, 2003 Refunding 1995, and 2010 Refunding 2001 Covenants 2003 Ref 2003 Ref 2010B Ref 2007 2007 1995A 1995B 2001B Series B Series D 2013-14 Pledged Taxes 2013-14 Net Revenue Total Taxes/Net Revenue 112 2014-15 Debt related to pledge: 2003 Ref 1995 Series A 2003 Ref 1995 Series B 2003 Series B 2007 Series B 2010 Series B Total Series A-B 2007 Series D (highest year) WIFA Loans (Parity Obligations) 2007 Series Utilities Total Debt Coverage Required Coverage Collective Coverage Total 2013-14 Taxes/Net Revenue Total 2014-15 Debt Coverage Required Coverage $ 54,061,984 $ 54,061,984 $ 50,160,513 $ 50,160,513 $ 50,160,513 $ 50,160,513 $ 50,160,513 $ 50,160,513 $ 59,917,507 $ 59,917,507 $ $ $ $ $ $ 1,622,400 1,622,400 33.3 4.0 $ 54,061,984 $ 7,451,398 7.3 4.0 $ 309,750 697,347 1,007,097 49.8 3.0 $ 50,160,513 $ 7,451,398 6.7 3.0 $ 2,522,331 2,522,331 19.9 3.0 $ 50,160,513 $ 7,451,398 6.7 3.5 $ 2,299,570 2,299,570 21.8 3.0 $ 50,160,513 $ 7,451,398 6.7 3.0 $ 4,804,825 4,804,825 12.5 1.5 $ 59,917,507 $ 12,256,223 4.9 3.0 2007 Series Utilities $ $ Total $ 1,622,400 309,750 697,347 2,299,570 2,522,331 7,451,398 4,804,825 $ 12,256,223 22,490,038 22,490,038 $ $ $ $ 6,715,892 9,009,138 15,725,030 1.4 1.2 22,490,038 15,725,030 1.4 1.2 2003A, 2003B, 2007B, 2003B Refunding and 2010B Refunding Series: Bond covenants require that each series cover both its related debt and the collective debt for the succeeding year. For 2007D Series, coverage requirements are measured against the maximum annual debt service. 2007 Series Utilities: Net Revenue is comprised of all income, monies, and receipts from ownership and operation of utility system to include interest income minus operation and maintenance expenses. City of Yuma, Arizona Pledged Tax Collections Last Ten Fiscal Years Fiscal Year 2010 113 2011 2012 2013 2014 $ 17,461,635 3,251,794 $ 17,635,454 3,243,939 $ 18,470,938 3,058,634 $ 19,248,864 3,043,054 $ 19,517,306 3,009,904 13,355,612 7,105,468 3,445,491 189,929 11,530,342 6,553,759 3,302,490 44,700 8,692,400 6,856,996 3,250,436 55,745 7,854,670 7,272,049 3,108,562 34,252 9,506,288 7,600,328 2,948,529 37,974 9,656,745 7,507,882 3,111,124 23,913 332,122 34,700 319,631 35,715 315,580 34,130 302,668 35,131 288,133 31,670 261,323 32,955 250,365 32,560 3,465,837 485,647 2,401,049 546,680 1,386,593 563,437 1,435,276 628,264 1,319,507 609,192 1,170,037 546,940 1,751,071 478,911 2,036,965 513,535 774,246 1,335,542 1,852,400 1,226,013 1,447,064 603,253 1,043,802 4,447,101 3,190,974 318,886 556,095 1,038,848 1,021,862 504,146 166,500 108,396 53,277 14,717 99,738 805,772 43,588,813 863,316 49,787,432 1,038,871 53,421,769 1,143,006 55,300,570 1,237,672 51,586,940 1,436,928 47,608,462 1,484,105 44,197,222 1,549,889 44,482,853 1,526,176 50,897,291 1,209,502 50,160,513 3,431,379 47,020,192 3,815,628 53,603,060 4,132,396 57,554,165 4,093,839 59,394,409 3,790,422 55,377,362 3,490,546 51,099,008 3,525,292 47,722,514 3,692,304 48,175,157 3,847,810 54,745,101 3,901,471 54,061,984 3,374,350 46,963,163 3,866,902 53,654,334 4,232,008 57,653,777 4,424,358 59,724,928 4,383,419 55,970,359 4,253,079 51,861,541 4,425,556 48,622,778 4,665,296 49,148,149 4,652,121 55,549,412 4,576,061 54,736,574 8,581,364 $ 52,170,177 9,542,314 $ 59,329,746 10,334,503 $ 63,756,272 10,238,080 $ 65,538,650 9,479,279 $ 61,066,219 8,729,333 $ 56,337,795 8,816,228 9,233,899 9,622,796 9,756,994 $ 53,013,450 $ 53,716,752 $ 60,520,087 $ 59,917,507 Gross Excise Tax Pledged Revenues $ 58,975,906 $ 67,012,276 $ 72,120,676 $ 74,056,847 $ 69,240,060 $ 64,081,420 $ 60,964,298 $ 62,074,352 $ 69,020,018 $ 68,395,039 Local Taxes Sales Tax (1%) Franchise Fee Intergovernmental Revenues: State Revenue Sharing State Sales Tax Auto In-Lieu Tax Emergency Services and Other Licenses: Business Licenses Liquor Licenses Fees for Services: Building Permits and Inspection Fees Recreation Fees Police Services and Other Public Safety Fees Use of Money and Property: Investment Income Fines, Forfeitures and Penalties: City Court Fines Total Series B Pledged Taxes Additional Series A Pledged Taxes City Public Safety Taxes (.2%) Total Series A Pledged Taxes Additional Series C Pledged Taxes City Special Taxes (2%) Total Series C Pledged Taxes Additional Series D Pledged Taxes City Road Tax (.5%) Total Series D Pledged Taxes 2005 2006 2007 2008 2009 $ 17,165,647 2,347,116 $ 19,087,873 3,360,835 $ 20,672,520 2,923,064 $ 20,479,641 3,135,077 $ 18,961,780 3,255,453 7,141,392 7,196,762 3,067,961 36,573 8,133,573 8,292,930 3,391,236 28,288 10,079,129 8,437,831 3,476,885 112,747 12,518,215 8,183,395 3,518,863 133,560 300,290 32,965 300,596 36,600 315,968 38,880 4,096,137 431,931 4,508,571 453,273 647,381 The Series C Pledged Taxes consist of the Excise Taxes and the City Special Taxes. The Series D Pledged Taxes consist of the Excise Taxes and the City Road Tax. City of Yuma, Arizona Demographic and Economic Statistics Last Ten Calendar Years Building Permits Personal Income Per Capita Personal Income Unemployment Rate No. Commercial 114 Year Population 2004 176,083 3,563,282 20 15.60% 1,300 2005 181,277 3,814,418 21 16.00% 2006 187,555 4,074,587 22 2007 190,557 4,320,000 2008 194,322 2009 No. Value 146,866,298 942 153,018,563 1,022 97,832,497 1,655 202,887,750 14.70% 1,057 229,391,979 1,568 148,285,471 23 13.90% 1,141 105,194,398 801 61,578,063 4,661,000 24 17.10% 740 101,217,617 972 50,218,987 193,299 4,840,484 25 21.30% 510 17,348,000 748 48,260,000 2010 195,751 4,994,489 26 26.30% 546 33,118,172 759 40,924,654 2011 196,830 5,300,165 27 27.10% 610 52,240,172 782 26,660,688 2012 200,870 5,441,761 27 28.40% 325 19,892,725 787 24,553,421 2013 200,022 5,399,670 27 28.70% 21 28,859,856 378 61,650,122 Note: Source: Value Residential Unemployment rate and population presented represents the Yuma Metropolitan Statistical Area and it reflects revised inputs, reestimation, and new statewide controls through 2013. U.S. Department of Commerce Bureau of Economic Analysis U.S. Department of Labor Bureau of Labor Statistics Building permits: Department of Community Development (calendar year basis) City of Yuma, Arizona Principal Employers Current Year and Nine Fiscal Years Ago 2004 115 Employer Marine Corps Air Station U. S. Army Yuma Proving Ground Yuma Regional Medical Center Yuma School District #1 Yuma County United States Border Patrol Walmart Yuma Union High School District City of Yuma Quechan Paradise Casino Growers Company Salyer American Fresh Total Employees 6,043 1,176 1,500 1,200 1,100 690 864 1,500 1,000 2013 Percentage of Total Rank Employment 1 9.67% 5 1.88% 2 2.40% 4 1.92% 6 1.76% * 10 1.10% 9 1.38% 2 2.40% 7 1.60% Employees 2,319 2,010 1,543 1,349 950 975 1,019 901 765 Rank 1 3 2 5 4 8 7 6 9 10 24.11% Source: Greater Yuma Economic Development Corporation/Employers Note: Figures presented represent the Yuma Metropolitan Statistical Area. Data for 2014 is not available. Walmart and Quechan Paradise Casino added in for 2010 due to Salyer and Growers dropping from list. *Estimated-data not reported Percentage of Total Employment 0.00% 3.55% 3.07% 2.36% 2.06% 1.45% 1.49% 1.56% 1.38% 1.17% 18.10% City of Yuma, Arizona Full-time Equivalent City Government Employees by Function Last Ten Fiscal Years Fiscal Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Function General government 195 208 226 228 241 235 192 201 192 198 116 Public Safety Police Fire Public Works Engineering Maintenance Solid Waste Water Wastewater Parks and recreation 237 105 252 110 267 122 269 122 266 122 267 133 239 129 249 131 258 125 259 125 30 50 15 59 45 128 32 52 15 64 48 136 37 51 16 73 52 141 44 47 16 75 52 145 44 56 17 76 47 133 41 56 17 80 51 133 33 46 13 73 49 116 32 46 13 73 49 116 32 46 13 76 52 116 24 52 13 76 52 117 Total 864 917 985 998 1,002 1,013 890 910 910 916 City of Yuma, Arizona Operating Indicators by Function Last Ten Fiscal Years 2005 2006 2007 2008 Fiscal Year 2009 2010 86,802 16,644 88,013 17,019 87,797 15,281 81,347 13,746 84,332 13,740 83,226 13,434 76,232 13,535 10,032 1,774 10,094 1,850 10,862 2,030 11,455 2,059 11,045 2,322 11,565 745 12,067 864 24 19 9 22 11 2 33,003 33,965 34,938 34,919 33,996 3,285 3,122 3,247 3,160 24,831 45.0 9.1 25,971 48.0 9.3 26,686 48.0 9.5 15.6 15.6 15.6 2011 2012 2013 2014 76,080 14,651 89,027 12,855 12,037 NA 12,664 1,399 12,529 1,460 15 10 24 30 33,288 32,638 32,177 32,010 26,650 2,673 2,519 2,554 2,327 2,551 2,097 27,174 48.0 9.5 27,622 60.0 8.2 28,058 64.0 7.5 28,984 65.0 8.4 29,009 65.0 8.3 27,396 65.0 8.1 29,361 65.0 7.1 15.6 15.6 15.6 15.6 15.6 15.6 15.6 Function 117 Police Calls for service* Case reports* Fire Number of calls answered* Inspections* Streets Streets slurry sealed (miles) Solid Waste Refuse collected (tons) Parks and recreation Ramada rentals Water Connections Daily treatment capacity (million gallons) Annual quantity processed (billion gallons) Wastewater Daily processing capacity (million gallons) Source: Various city departments. Note: Indicators are not available for the general government function. *Numbers presented are for calendar year. Due to a software conversion in 2013 the water connection data isn't fully verified NA NA City of Yuma, Arizona Capital Asset Statistics by Function Last Ten Fiscal Years 2005 2006 2007 2008 Fiscal Year 2009 2010 2011 2012 2013 2014 Function 118 Public Safety Police stations Police vehicles Fire stations Streets Streets (miles) Streetlights Traffic Signals Solid Waste Collection trucks Parks and Recreation Parks acreage Parks/Athletic Fields Swimming pools Tennis courts Community centers Water Water mains (miles) Fire hydrants Wastewater Sanitary sewers (miles) Manholes 1 127 6 1 134 6 1 143 6 1 150 6 1 163 6 1 164 6 1 163 6 1 156 6 2 172 6 2 179 6 361 5,042 36 361 5,298 38 361 5,303 40 361 5,375 42 384 5,463 42 389 5,606 49 395 5,750 50 420 5,753 50 421 5,764 79 442 6,757 79 10 12 13 13 13 13 13 11 11 11 553 25 3 1 9 578 25 3 1 9 592 27 3 1 9 607 32 3 1 9 607 79* 4 2 9 607 79 4 9 9 607 79 4 9 9 607 79 4 9 9 607 79 4 9 9 620 80 4 9 9 448 2,850 470 3,000 493 3,150 501 3,267 501 3,400 507 3,438 520 3,450 525 3,573 525 3,646 527 3,754 275 290 310 320 320 342 340 341 350 350 5,318 Sources: Various city departments. Note: No capital asset indicators are available for the general government function. *Change in the inventory of athletic fields from counting athletic complexes versus individual fields.