To Table of Contents City of Casa Grande, Arizona Comprehensive Annual Financial Report Fiscal Year Ended June 30, 2015 To Table of Contents City of Casa Grande, Arizona COMPREHENSIVE ANNUAL FINANCIAL REPORT For the Fiscal Year Ended June 30, 2015 Prepared by the Finance Department Doug Sandstrom, Finance Director Celina Morris, Accounting Manager Julie Scherer, Senior Accountant Gay Barnhart, Administrative Assistant To Table of Contents TABLE OF CONTENTS I. INTRODUCTORY SECTION Letter of Transmittal GFOA Certificate of Achievement City of Casa Grande Officials Organizational Chart Page i vii ix x II. FINANCIAL SECTION Independent Auditors’ Report A. Management’s Discussion & Analysis 1 7 B. Basic Financial Statements Government-wide Financial Statements Statement of Net Position Statement of Activities 21 22 Fund Financial Statements Governmental Fund Financial Statements Balance Sheet Reconciliation of the Balance Sheet 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 Balances of Governmental Funds to the Statement of Activities Budgetary Comparison Statements – General Fund Budgetary Comparison Statements – Highway Users Fund 24 27 28 29 30 33 Proprietary Fund Financial Statements Statement of Net Position Statement of Revenues, Expenses and Changes in Fund Net Position Statement of Cash Flows 34 36 38 Fiduciary Fund Financial Statements Statement of Fiduciary Net Position Statement of Changes in Fiduciary Net Position 42 43 Notes to Financial Statements 1. 2. 3. 4. Summary of Significant Accounting Policies Cash and Investments Cash with Fiscal Agent/Restricted Investments Receivables 47 57 61 62 B. Basic Financial Statements (Continued) Notes to Financial Statements (Continued) 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. C. Direct Loans Property Taxes Capital Assets Pensions and Other Postemployment Benefits Risk Management Capital Leases Bond Debt Excise Tax Revenue Obligations WIFA Financing Changes in Long-Term Obligations Long-Term Debt Landfill Closure and Post Closure Care Costs Construction Commitments Summary of Interfund Transactions Deficit in Fund Balance Sales Tax Incentive Agreement Fund Balance Details by Classification Restatement of Net Position Page 62 63 64 65 81 82 83 84 86 87 88 88 89 89 90 90 91 92 Required Supplementary Information Schedule of the City’s Proportionate Share of the Net Pension Liability Cost-Sharing Pension Plan Schedule of Changes in the City’s Net Pension Liability (Asset) and Related Ratios Agent Pension Plan Schedule of the City Pension Contributions Notes to the Pension Plan Schedules Schedule of Agent OPEB Plans’ Funding Progress Notes to the Schedule of Agent OPEB Plans’ Funding Progress 95 96 100 101 102 103 D. Other Supplementary Information Combining Fund Financial Statements - Non-Major Governmental Funds Combining Balance Sheet 106 Combining Statements of Revenues, Expenditures and Changes in Fund Balances 110 Budgetary Comparison Schedules - Other Major Governmental Funds Schedule of Expenditures – General Fund - Legal Level Budget Compliance Capital Replacement/Recreation/Development Fund 117 118 Budgetary Comparison Schedules - Non-Major Governmental Funds Municipal Airport Special Revenue Fund Parks Development Special Revenue Fund Community Arts Reserve Special Revenue Fund Redevelopment/Downtown Revitalization Special Revenue Fund Promotion and Tourism Special Revenue Fund Court Enhancement/Probationary Special Revenue Fund Housing Application and Development Fees Special Revenue Fund Community Development Block Grant Special Revenue Fund 121 122 123 124 125 126 127 128 D. Other Supplementary Information (Continued) Budgetary Comparison Schedules - Non-Major Governmental Funds (Continued) Home/Hud Special Revenue Fund Grants and Subsidies Special Revenue Fund Wildland Firefighting/Public Safety Special Revenue Fund General Obligation/Bond Debt Service Fund Recreation Debt Service Fund Community Services Capital Projects Fund Transportation Capital Projects Fund Public Safety Capital Projects Fund Community Facilities Districts – Capital Projects Airport Improvement Capital Projects Fund System Development Fund Page 129 130 131 132 133 134 135 136 137 138 139 Schedule of Operations – Budget and Actual – Proprietary Funds Enterprise Funds Copper Mountain Ranch Wastewater Wastewater Development Fees Sanitation Golf Course 143 144 145 146 147 Fiduciary Funds Combining Statement of Fiduciary Net Assets Combining Statement Changes in Assets and Liabilities – All Agency Funds 151 152 III. STATISTICAL SECTION Net Position by Component Changes in Net Position – Governmental Activities Changes in Net Position – Business type Activities Fund Balances of Governmental Funds Changes in Fund Balances of Governmental Funds Sales Tax Revenue by Industry Direct and Overlapping Sales Tax Rates Ratios of Outstanding Debt by Type Ratio of General Bonded Debt Outstanding Direct and Overlapping Governmental Activities Debt Legal Debt Margin Information Pledged –Revenue Coverage Real & Personal Property Tax Levies and Collections Tax Rate Data Estimated Net Secondary Assessed Valuation of Major Taxpayers Demographic and Economic Statistics Principal Employers Authorized City Government Employee Positions by Function/Program Operating Indicators by Function/Program Capital Asset Statistics by Function/Program Table 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Page 156 158 160 162 164 166 169 170 172 173 174 175 176 177 178 179 180 181 182 183 IV. COMPLIANCE SECTION Independent Auditors’ Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards Independent Auditors’ Report on Compliance for Each Major Program and on Internal Control over Compliance Required by OMB Circular A-133 Schedule of Expenditures of Federal Awards Notes to Schedule of Expenditures of Federal Awards Schedule of Findings and Questioned Costs 187 189 191 193 194 To Table of Contents INTRODUCTORY SECTION To Table of Contents To Table of Contents City of Casa Grande, Arizona December 24, 2015 Honorable Mayor, City Council, City Manager Citizens of Casa Grande, Arizona We are pleased to submit the Comprehensive Annual Financial Report (CAFR) of the City of Casa Grande, Arizona (the City) for the fiscal year ended June 30, 2015. This report was prepared by the City’s Finance Department. This document represents management’s report to its governing body, constituents, legislative and oversight bodies, investors, and creditors. Copies of this report are sent to elected officials, management personnel, bond rating agencies, Nationally Recognized Municipal Securities Information Repositories, and other agencies with an expressed interest in the City’s financial matters. Copies of this financial report will be placed in the City libraries for use by the general public, and posted on the City’s web page at www.casagrandeaz.gov. Responsibility for the accuracy of the presented data and for the completeness and fairness of the presentations, including all disclosures, rests with the management of the City. The City established and maintains a comprehensive internal control framework designed to protect the government’s assets from loss, theft or misuse and to compile sufficient reliable information for the preparation of financial statements. We believe the data presented in this report is accurate in all material respects and fairly sets forth the financial position and results of operations of the City on both a city-wide and fund basis. We include all disclosures necessary to enable the reader to gain an understanding of the City’s financial activity and financial stability. These financial statements are prepared in accordance with generally accepted accounting principles in the United States of America (GAAP) for local governments as prescribed by the Governmental Accounting Standards Board (GASB) and the American Institute of Certified Public Accountants (AICPA). Henry & Horne, L.L.P. audits the City of Casa Grande, Arizona’s financial statements. The independent audit report is presented as the first component in the financial section. The examination satisfies Article VI, Section 6, of the City Charter, which requires an annual audit of all accounts of the City by an independent certified public accountant. The goal of the independent audit is to provide reasonable assurance that the financial statements of the City of Casa Grande, Arizona, for the fiscal year ended June 30, 2015 are free from material misstatement. The independent audit involved examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements; assessing 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 a reasonable basis exists for rendering an unqualified opinion that the financial statements of the City of Casa Grande, Arizona for the fiscal year ended June 30, 2015, are fairly presented, in all material respects, in conformity with GAAP. i To Table of Contents Additionally, the City is required to have an independent audit (“Single Audit”) of federal financial assistance received by the City directly from federal agencies, or passed through to the City by the State of Arizona, or other governmental entities during the fiscal year. 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 government’s internal controls and compliance with legal requirements having a direct and material impact on major programs, with special emphasis on internal controls and compliance requirements involving the administration of major federal awards. The results of the City’s Single Audit for the fiscal year ended June 30, 2015, found no instances of material weakness in the internal control structure, or significant violations of applicable laws and regulations with respect to major programs. The reports from Henry & Horne L.L.P. are available in the City of Casa Grande, Arizona’s separately issued Single Audit Report. FINANCIAL CONTROLS Internal Controls As previously noted, the management of the City of Casa Grande is responsible for establishing and maintaining a system of internal control. Internal accounting controls are designed to provide reasonable, but not absolute, assurance regarding: 1) safeguarding of assets against loss from unauthorized use or disposition, and 2) reliability of financial records for preparing financial statements and maintaining accountability for assets. The concept of reasonable assurance recognizes: 1) the cost of a control should not exceed the benefits likely to be derived, and 2) the valuation of costs and benefits requires estimates and judgments by management. The system of internal control is subject to periodic evaluation by management and is also considered by the independent auditors in connection with the annual audit of the City’s financial statements. All internal control evaluations occur within the above framework. The City’s internal accounting controls are considered to adequately safeguard assets and provide reasonable assurance of proper recording of financial transactions. Budgetary Controls The City of Casa Grande, like all cities in the State of Arizona, is subject to numerous budget and related legal requirements. Article IX, Section 20 (1) of the Arizona Constitution sets limits on the City’s legal budget capacity. The City operates under the Permanent Base Adjustment Alternative Expenditure Limit. The limit provides a cap on expenditures for the City. The base year is 1979-80 and the base amount is increased annually by population change and by the implicit price deflator. In May 2007, the voters approved a permanent base adjustment to the state imposed expenditure limit. This option allowed Casa Grande to adjust the state imposed expenditure base from the original 1979-80 base of $3,743,397 to $18,793,221. After adjustments for inflation and population growth, the City’s expenditure limitation for fiscal year 2014-2015 is $191,234,966. The City maintains budgetary controls to ensure compliance with legal provisions embodied in the annual appropriated operating budget approved by the Mayor and Council. Activities of the general fund, special revenue funds, debt service funds, capital projects funds, enterprise funds, and internal service funds are included in the annual appropriated budget. The legal level of budgetary control (i.e., the level at which expenditures cannot legally exceed the appropriated amount) is the total budget, as adopted by the City Council. The City additionally exercises management control and oversight of the budget at the department and project level within each fund. PROFILE OF THE CITY The City of Casa Grande was founded in 1879 and is named for the famous Hohokam Indian Ruins. Since its incorporation in 1915, Casa Grande has grown to be the largest community in western Pinal County. Casa Grande is located in central Arizona, approximately halfway between the State’s two largest metropolitan areas of Phoenix and Tucson, and is surrounded by three Indian Reservations. In addition, the City is located at the intersection of two major interstate highways, one services the Los Angeles and San Diego markets, one to the Phoenix & Tucson markets. The City is a dynamic, involved city with a rural heritage and old-fashioned values. The economic base is a mix of retail trade, manufacturing and agriculture. ii To Table of Contents The City of Casa Grande, chartered in December 1974, has a Council-Manager form of government consisting of the Mayor and six Council members. The Mayor is elected at-large for a two-year term and cannot serve more than four consecutive terms. Council members are elected to four-year terms. The City Council is vested with policy and legislative authority and is responsible for appointing the positions of City Manager, City Attorney and City Judge. The City Manager is responsible for carrying out the policies and ordinances of the City Council, as well as overseeing the day-to-day operations. The City of Casa Grande’s legal boundaries grew substantially over the past several years to just over 110 squares miles. The Voters approved the 2020 General Plan on November 3rd, 2009. The City’s population has doubled from 25, 224 in 2000 to 51,478 in 2015. The City’s growth is attributed to affordable housing, proximity to labor opportunities in the metropolitan areas, and the rural quality of life offered to the residents. The majority of this growth occurred prior to 2009. The City provides a full range of municipal services, including police and fire protection, maintenance of streets, recreational and cultural events, two libraries, planning and zoning, building inspection, code enforcement, wastewater, sanitation, airport, golf course and general administration. The City has invested considerably in its historic downtown area over the past several years creating a vibrant community asset. Financial Statement Structure The Comprehensive Annual Financial Report (CAFR) consists of three sections: Introductory, Financial, and Statistical. The Financial section begins with the Independent Auditors Report and is followed by the management’s discussion and analysis that provides summary information about the results of operations. The Comprehensive Annual Financial Report (CAFR) includes financial statements on both a government-wide and fund basis for the primary government as well as its component units. Component units are separate legal entities included in the reporting entity due to the significance of their financial or operational relationship with the City. Criteria used by the City for inclusion of activities in preparing its financial statements are in conformity with GASB Statement No. 14, The Financial Reporting Entity. Blended component units, although legally separate entities, are, in substance, part of the primary government’s operations and are included as part of the primary government. Accordingly, the financial reporting entity consists of the City and four blended component units, the Copper Mountain Ranch Community Facilities District, the Mission Royale Community Facilities District, the Villago Community Facilities District and the Post Ranch Community Facilities District as discussed further in Note 1 (A) on page 47 of the notes to the financial statements. ECONOMIC CONDITIONS AND OUTLOOK The information presented in the financial statement is perhaps best understood when it is considered from the broader perspective of the specific environment within which the City operates. The economy of Casa Grande is a diverse combination of agriculture, manufacturing, commercial and service activities, as well as a haven for retired individuals who spend winters in Arizona. The community serves as the provider of many goods and services to the rural areas surrounding the City, as well as several growing communities located in the area. This combination of diverse economic activities keeps the community from becoming overly dependent on any single segment of the economy. The Community has adopted a Strategic Plan for Community and Economic Development with the purpose of developing a process to successfully attract and retain diverse types of businesses, attract new revenue, and expand/maintain the community revenues essential to sustaining Casa Grande and improving the overall quality-of-life. Local indicators point to continued stability. Casa Grande is witness to a sustained, but lower number of issued building permits. The prior three fiscal years has seen a slow residential housing construction market. Non-residential building permits with a value of $45.3 million were issued in fiscal year 2015, with an increase from FY2014, continued commercial development conveys the actuality that sufficient roof-tops have been constructed to expand the commercial markets, which in turn expands the City’s economy and tax base. Casa Grande’s economy is reflective of the State and the nation as whole, the City is experiencing slow sustained economic growth in nearly all areas with the exception of residential construction. Although total sales tax revenue is down 23% from our peak collections in FY2008, when adjusted for the construction portion of the sales tax the City’s iii To Table of Contents FY2015 collections are actually 10.0% higher than FY2008 collections and reflect five (5) consecutive years of reoccurring growth. Transaction Privilege Tax (Sales Tax). The City of Casa Grande, like all Arizona cities, places a heavy reliance on City sales tax. Overall, local sales tax revenues comprise 43.8% of General Fund revenues. The City’s sales tax rate is currently at 1.8%, with an additional 0.2% pledged to park and recreation projects, or for economic development. Management is projecting the city’s sales tax collections to continue increasing slightly next year as the economy continues its recovery. State Shared Revenues. The City of Casa Grande receives revenue allocations from the State. These “State Shared Revenues” include allocations of the state-collected income tax, sales tax, gas tax, and motor vehicle taxes based on population formulas that are created on official census data. With the exception of the gas tax which must be kept in a separate fund for transportation related activities, all other state shared revenues are placed in the General Fund, where they support daily operations. Like our local sales tax, this revenue source is expected to increase gradually as the economy continues improving. Although a stable source of revenue for the City, state-shared revenues are distributed through the state and are subject to some level of attention from the state legislature each year. Property Tax. The City’s primary property tax rate for FY 2015 remained constant at $0.9999 per $100 of assessed valuation. Keeping the primary tax rate below $1.00 is a goal of the City Council which was maintained even in years that the City was experiencing decreasing property values. The amounts collected under the primary levy can be used for any general government purpose, but is limited in size by State statute. The City has received voter authorization to issue $47 million in General Obligation debt. Of this amount $11 million was issued in FY2008 and an additional $19 million in FY2009. The city levies a secondary property tax to fund this debt service. The secondary rate continues to be $0.6308 per $100 of assessed valuation. The City is considering the issuance of an additional $16.0 million of currently authorized General Obligation debt for the construction of a recreation center in FY2016. If issued this debt would result in an increase to the secondary levy the following year. MAJOR INITIATIVES AND ACCOMPLISHMENTS During FY2015 the City continued to invest in programs and services that make Casa Grande a better community. The following are some of the efforts and accomplishments of the City during the year: Police o o o Fire o o o o Part 1 UCR crimes per 1,000 decreased by 11% Cleared 43% of Part 1 UCR crimes 265 animals adopted Responded to 6,952 emergencies, of which 5,400 (78%) were emergency medical services and 232 (3%) were fire related 80% of ALS responses were under 5 minutes 3.0 residential structure fires per 1,000 structures Continued mentoring of the Casa Grande Fire Explorers Program Public Works o Hosted the 57th Annual Cactus Fly-In at the municipal airport o Treatment of an average of 5.0 million gallons per day of wastewater o Collected 18.3 tons of residential trash o Collected 62,295 tons of solid waste at the landfill site o Recycled an average of 45.0 lbs per household per quarter in residential solid waste materials Community Services o Resurfaced patio around the pool and replaced older fencing o Golfers played 68,071 rounds of nine hole equivalents o 98% of program participants rated programs as satisfactory or better o Library visitors of 311,357 at the two libraries o Served a total of 29,505 meals and received a total of 6,204 volunteer hours o Maintained 10.77 acres of parkland per 1,000 population at a cost of $1,108 per acre iv To Table of Contents Development Center o Issued 1,653 building permits o Performed an average of 17 inspections per inspector per day OTHER MATTERS Debt Administration. On June 30, 2015, the City had a number of debt issues outstanding. Total debt at June 30, 2015, was $168.9 million. The City’s general credit was rated A+ by Fitch Ratings and received an A- rating from Standard & Poors. The City is diligent in its efforts to maintain and improve these ratings. The ratings for the existing issues are as follows: Excise Tax Series 2009 Excise Tax Series 2012 General Obligation Bonds Standard & Poors Investor Service nr AA nr Fitch IBCA AAnr AA All Excise Tax Revenue Obligations are secured by a pledge of and first lien on all excise, transaction, franchise, privilege and business taxes, state shared sales and income taxes, fees for licenses and permits and state revenue sharing, which the City presently or in the future validly imposes or receives from other entities. As of June 30, 2015 the City had $26.3 million of Excise Tax Revenue Obligations outstanding. Under State statutes the City can issue general obligation bonds for up to an amount not exceeding 20% of the secondary assessed valuation. As of June 30, 2015, the City has debt capacity remaining of $60.8 million for general obligation bonds subject under the 20% and 6% constitutional limitations based on the FY 2015 secondary assessed valuation. The City has $26.8 in outstanding General Obligation bonds, with voter approval to issue an additional $17 million over the next several years. FINANCIAL POLICIES 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; injuries to employees; and natural disasters. The City’s liability risks are covered by commercial insurance purchased from independent third parties. The City is fully insured with per occurrence limit at $2 million general liability coverage with a $25,000 deductible and a $13 million umbrella liability policy. The City of Casa Grande has an aggressive safety program that promotes employee safety on the job and focuses on risk control techniques designed to minimize accident-related losses. v To Table of Contents OTHER INFORMATION 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 of Casa Grande, Arizona, for its comprehensive annual financial report for the fiscal year ended June 30, 2014. The City has received this prestigious award every year since 1989. In order to be awarded a Certificate of Achievement, a government must publish an easy to read and efficiently organized comprehensive annual financial report. This report must satisfy both generally accepted accounting principles and applicable legal requirements. A Certificate of Achievement is valid for a period of one year only. We believe our current report continues to conform to the Certificate of Achievement program requirements, and we are submitting it to the GFOA to determine its eligibility for another certificate. The Government Finance Officers Association of the United States and Canada presented a Distinguished Budget Presentation Award to the City of Casa Grande, Arizona for its annual budget for the fiscal year beginning July 1, 2014. To receive this award, a governmental unit must publish a budget document that meets program criteria. The Award is valid for a period of one year. The City of Casa Grande has received the Distinguished Budget Presentation Award every year since 1996. We expect to continue to participate and meet the program requirements. The preparation of the City's Comprehensive Annual Financial Report was only made possible by the dedication and hard work of every member of the Finance Department, and the firm of Henry and Horne, L.L.P. We give them our sincere thanks for their effort in the creation of this report. We wish to express our appreciation to the City Manager, the Mayor and City Council for their continued support and leadership. Sincerely, Doug Sandstrom Finance Director vi To Table of Contents vii To Table of Contents To Table of Contents City of Casa Grande, Arizona COMPREHENSIVE ANNUAL FINANCIAL REPORT For the Fiscal Year Ended June 30, 2015 CITY COUNCIL Mayor Robert M. Jackson Mayor Pro-Tem Karl Montoya Council Members Lisa Fitzgibbons Matt Herman Mary Kortsen Dick Powell Ralph Varela City Manager James Thompson Deputy City Manager Larry Rains Finance Department Staff Doug Sandstrom, Finance Director Celina Morris, Accounting Manager Julie Scherer, Senior Accountant Gay Barnhart, Administrative Assistant ix To Table of Contents City of Cas a Grande Organizational Chart People of Cas a Grande Mayor and Council City Manager City Attorney Police Adminis tration Deputy City Manager Fire Departm ent Public Works Hum an Res ources Anim al Control Engineering Ris k Managem ent Communications Was tewater Police Patrol Sanitation Police Criminal Inves tigations Police Special Operations City Clerk City Court Finance Department Planning & Development Com munity Services Financial Services Planning Library Inform ation Sys tems Permits Senior Adult Services Geographical Inform ation Sys tem Ins pections Parks Maintenance Equipment Maintenance Hous ing Recreation Programs Streets Code Enforcement Len Colla Center Public Information Officer Water Aquatics Airport Women's Club Facilities Maintenance Golf Cours e General Recreation x To Table of Contents FINANCIAL SECTION To Table of Contents To Table of Contents INDEPENDENT AUDITORS' REPORT The Honorable Mayor and Council City of Casa Grande, Arizona Report on the Financial Statements We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of City of Casa Grande, Arizona, as of and for the year ended June 30, 2015, 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. Auditors’ 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 auditors’ 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. Tempe 2055 E. Warner Road Suite 101 Tempe, AZ 85284-3487 (480) 839-4900 Fax (480) 839-1749 Scottsdale 7098 E. Cochise Road Suite 100 Scottsdale, AZ 85253-4517 (480) 483-1170 Fax (480) 483-7126 Casa Grande 1115 E. Cottonwood Lane Suite 100 Casa Grande, AZ 85122-2950 (520) 836-8201 Fax (520) 426-9432 w w w . h e n r y a n d h o r n e . c o m To Table of Contents 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, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Casa Grande, Arizona, as of June 30, 2015, and the respective changes in financial position and, where applicable, cash flows thereof and the respective budgetary comparison for the General Fund and Highway Users Revenue Fund for the year then ended in accordance with accounting principles generally accepted in the United States of America. Emphasis of Matter Change in Accounting Principle As discussed in Note 1 to the financial statements, the Governmental Accounting Standards Board (GASB) issued Statement No. 68, Accounting and Financial Reporting for Pensions, as amended by GASB Statement No. 71, Pension Transition for Contributions Made Subsequent to the Measurement Date that could have a material impact on the financial statements. GASB Statements No. 68 and No. 71 have impacted the presentation of the financial statements by establishing standards for measuring and recognizing net pension liabilities, deferred outflows of resources, deferred inflows of resources, and expenses related to pension benefits provided through defined benefit pension plans. In addition, Statement No. 68 requires disclosure of information related to pension benefits. As discussed in Note 22 to the financial statements, the adoption of GASB Statements 68 and 71 resulted in the restatement of beginning net position for governmental activities, business-type activities and the related enterprise funds net position. Our opinion is not modified with respect to these matters. Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis, and the required supplementary information as listed in the table of contents 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. To Table of Contents Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City of Casa Grande, Arizona’s basic financial statements. The introductory section, other supplementary information, and statistical section are presented for purposes of additional analysis and are not a required part of the basic financial statements. The schedule of expenditures of federal awards is presented for purposes of additional analysis as required by U.S. Office of Management and Budget Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations, and is also not a required part of the basic financial statements. The other supplementary information and the schedule of expenditures of federal awards 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 supplementary information and the schedule of expenditures of federal awards are 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. Compliance Over the Use of Highway Users Revenue Fund and Other Dedicated State Transportation Revenue Monies In connection with our audit, nothing came to our attention that caused us to believe that the City of Casa Grande, Arizona failed to use highway user revenue fund monies received by the City pursuant to Arizona Revised Statutes Title 28, Chapter 18, Article 2, and any other dedicated state transportation revenues received by the City of Casa Grande solely for the authorized transportation purposes, insofar as they relate to accounting matters. However, our audit was not directed primarily toward obtaining knowledge of such noncompliance. Accordingly, had we performed additional procedures, other matters may have come to our attention regarding the City of Casa Grande’s noncompliance with the use of highway user revenue fund monies and other dedicated state transportation revenues, insofar as they relate to accounting matters. The communication related to compliance over the use of highway user revenue fund and other dedicated state transportation revenue monies in the preceding paragraph is intended solely for the information and use of the members of the Arizona State Legislature, management, and other responsible parties with the City and is not intended to be and should not be used by anyone other than these specified parties. To Table of Contents Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report date December 24, 2015 on our consideration of the City’s internal control over financial reporting and 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 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 the City of Casa Grande, Arizona’s, internal control over financial reporting and compliance. Casa Grande, Arizona December 24, 2015 To Table of Contents FINANCIAL SECTION MANAGEMENT’S DISCUSSION AND ANALYSIS To Table of Contents To Table of Contents MANAGEMENT’S DISCUSSION AND ANALYSIS As management of the City of Casa Grande, Arizona (the City), we offer this narrative overview and analysis of the financial activities of the City of Casa Grande, Arizona for the fiscal year ended June 30, 2015. This discussion and analysis is designed to (1) assist the reader focus on significant financial issues, (2) provide an overview of the City’s financial activity, (3) identify changes in the City’s financial position, (4) identify any material deviations from the approved annual budget, and (5) identify individual fund issues or concerns. Please read it in conjunction with the transmittal letter presented on pages i - vi of this report as well as the City’s financial statements beginning on page 21 and the accompanying notes to the financial statements. Financial Highlights  The City’s total net position, on the government-wide basis, totaled $246.0 million at June 30, 2015 of which $3.2 million is unrestricted. This is a decrease of $53.2 million from fiscal year 2014, a decrease of $49.6 million in the government activities and decrease of $3.6 million in the business-type activities. This decrease is mainly attributable to the implementation of GASB Statement No. 68, which requires employers to report their net pension liabilities (unfunded liabilities) in the financial statements, along with the corresponding calculated pension expense and deferred outflows/inflows of resources related to pensions. Additional detail can be obtained in the extensive footnote disclosures and additional required supplementary information.  The governmental activities revenues increased by approximately $8.6 million over the previous year.  The business-type activities operating revenues increased by $0.8 million over the previous year due mainly to increased rates.  The General Fund reported a positive change in fund balance of $4.5 million for the year.  At June 30, 2015, restricted, assigned and non-spendable balance for the General Fund was $29.9 million, or 50% of General Fund expenses for fiscal year 2015.  At June 30, 2015, unassigned fund balance of the General Fund was $11.7 million.  The governmental activities general revenues of $61.8 million were $4.2 million less than expenses before other financial sources and uses.  Net Pension liabilities of the City are included reflecting $53.3 million in governmental activities and an additional $4.6 million in business-type activities. 7 To Table of Contents OVERVIEW OF THE FINANCIAL STATEMENTS Required Components of the Annual Financial Report Management’s Discussion and Analysis GovernmentWide Financial Statements Basic Financial Statements Fund Financial Statements Summary Required Supplementary Information Other Supplementary Information Notes to the Financial Statements Detail Government-wide Financial Statements The government-wide financial statements (see pages 21-23) are designed to provide a broad overview of the City’s finances in a manner similar to those used by private businesses. These statements include all assets and liabilities using the accrual basis of accounting, which is similar to the accounting used by most private-sector companies. All of the current year’s revenues and expenses are taken into account regardless of when cash is received or paid. The activities of the City are broken into two columns on these statements – governmental activities and business-type activities. A total column is also provided. Governmental activities include the basic services of the City including general government (administration), parks and recreation, police, fire, planning and development and streets. Taxes and other general revenues support the majority of these activities. Business-type activities include the private sector type activities such as golf course, sanitation, water and wastewater. These activities are primarily supported through user charges and fees. The statement of net position presents information on all of the City’s assets and liabilities, both current and long-term. The difference between assets and liabilities is reported as net position. The focus on net position is designed to focus on government as a business. 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. However, to accurately assess the overall health of the City, other indicators, including non-financial indicators like the City’s property tax base, GASB changes and condition of infrastructure, must also be considered. The statement of activities presents information showing how the City’s net position changed over the most recent fiscal year. Full accrual accounting is used for the government-wide financial statements and all changes to net position are reported at the time that the underlying event giving rise to the change occurs, regardless of the timing of the related cash flows. This statement also focuses on both the gross and net costs of the various functions of the City, 8 To Table of Contents based only on direct functional revenues and expenses. The statement is designed to show the extent to which the various functions depend on general taxes and revenue for support. Fund Financial Statements Also presented in the basic financial statements are the traditional fund financial statements for major funds of the City. A major fund is determined based on the percentage a certain fund value is in relation to all other funds of the same fund type – either governmental or proprietary. A fund is a grouping of related accounts used to maintain control over resources segregated for specific activities or conditions. Funds ensure and demonstrate compliance with finance-related legal requirements as well as for managerial control to demonstrate fiduciary responsibility over the assets of the City. The City has four (4) kinds of funds: Governmental funds – Most of the City’s basic services are included in governmental funds, which focus on (1) how cash and other financial assets can readily be converted to cash flow in and out and (2) the balances left at the year-end that are available for spending. Consequently, the governmental funds statements provided a detailed shortterm view that helps the reader determine whether there are more or fewer financial resources that can be spent in the near future to finance the City’s programs. Because this information does not encompass the additional long-term focus of the governmentwide statements, we provide a reconciliation to facilitate this comparison between governmental funds and governmental activities. These reconciliations are on page 27 and 29, respectively. Proprietary funds – Proprietary funds account for business-type activities of the City. Proprietary funds, like the government-wide statements, provide both long and shortterm financial information. Enterprise funds are used for activities that primarily serve customers for which fees are charged. The City has four enterprise funds: golf course, sanitation, water and wastewater funds. Internal Service funds - The internal service funds reflect activities in which the City is the customer. The fleet services, facilities maintenance and risk management funds are the City’s three internal service funds. Their purpose is to provide vehicle maintenance and facilities services to City departments and to provide cost accounting for property and casualty insurance costs and risk management. Fiduciary funds – Fiduciary funds account for resources held for the benefit of others. Fiduciary funds are not included in the government-wide financial statements because the resources of those funds are not available to support projects of the City. Notes to the financial statements – The notes to the financial statements (pages 47-92) provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements and should be read with the financial statements. Required supplementary information other than MD&A – Governments have an option of including the budgetary comparison statements for the general fund and major special revenue funds as either part of the fund financial statements within the basic financial statements or as 9 To Table of Contents required supplementary information after the notes. The City has chosen to present these budgetary statements as part of the basic financial statements and in the supplementary information. Additionally, governments are required to disclose certain information about employee pension funds. The City has disclosed this information in Note 8 to the financial statements. GOVERNMENT-WIDE FINANCIAL ANALYSIS The following tables, graphs and analysis discuss the financial position and changes to the financial position for the City as a whole as of and for the year ended June 30, 2015. Statement of Net Position Net position may serve over time as a useful indicator of the City’s financial position. The following table reflects the condensed statement of net position as of June 30, 2015. The City has chosen to account for its golf course, water, wastewater and sanitation operations in enterprise funds which are shown as Business Activities. Statement of Net Position (in Millions) Governmental Business-type Total Activities Activities Primary Government 2014 Current and other assets $ Capital assets Total assets Deferred Outflow of Resources Other liabilities Long-term liabilities Total liabilities Deferred Inflow s of Resources 91.9 2015 $ 98.9 2014 $ 15.9 2015 $ 15.5 2014 $ 107.8 2015 $ 114.4 201.3 192.4 110.2 107.3 311.5 299.7 293.2 291.3 126.1 122.8 419.3 414.1 0.0 9.7 0.0 0.5 0.0 10.2 3.5 3.2 1.7 1.2 5.2 4.4 53.3 106.8 61.6 62.1 114.9 168.9 56.8 110.0 63.3 63.3 120.1 173.3 0.0 4.2 0.0 0.8 0.0 5.0 Net position: Invested Capital assets net of related debt 151.7 142.7 51.4 52.9 203.1 195.6 Restricted 23.4 40.9 6.2 6.3 29.6 47.2 Unrestricted 61.3 3.2 5.2 0.0 66.5 3.2 Total net position $ 236.4 $ 186.8 $ 62.8 $ 59.2 $ 299.2 $ 246.0 10 To Table of Contents At year end June 30, 2015 the net position of the City totaled $246.0 million, a decrease of $53.2 million from June 30, 2014. Of this amount, $186.8 million was in governmental activities, a 20.8% decrease and $59.2 million was in the business-type activities, a 5.7% decrease from the prior fiscal year. Net Position consists of three components. The largest portion of net position ($195.6 million or 79.4%) reflects the City’s investment in capital assets net of accumulated depreciation and any related outstanding debt used to acquire or construct those assets. The City uses these capital assets to provide services to its citizens; consequently, it is not the City’s intention to sell these assets and they are therefore not available for future spending. The restricted portion of the City’s net position ($47.2 million or 19%) represents resources subject to external restrictions on how they may be spent. This component is primarily made up of required fund balance reserves and accumulated development impact fees collected by the City. These funds are specifically reserved for capital improvements pertaining to growth as it relates to maintaining a consistent level of service to all citizens. The third portion consists of unrestricted net position ($3.2 million or 1.5%), which may be used to meet the City’s ongoing obligation to citizens and creditors. 11 To Table of Contents Changes in Net Position The City’s total revenues for the year ended June 30, 2015 were $79.0 million. The total cost of all programs and services was $82.0 million. The following table presents a summary of the changes in net position for the year ended June 30, 2015. Changes in Net Position (in millions) Governmental Business-type Activities Activities 2014 Revenues 2015 2014 Total 2015 2014 2015 Program revenues Charges for services $ 4.3 $ 7.0 $ 15.7 $ 16.6 $ 20.0 $ 23.6 Operating grants and contributions 7.2 6.8 - - 7.2 6.8 Capital grants and contributions 1.3 4.1 0.6 0.6 1.9 4.7 General revenues Property taxes 6.2 6.3 - - 6.2 6.3 19.7 21.8 - - 19.7 21.8 Franchise taxes 2.2 2.4 - - 2.2 2.4 Shared revenues 11.9 12.8 - - 11.9 12.8 0.4 0.4 0.1 - 0.5 0.4 53.2 61.6 16.4 17.2 69.6 78.8 Sales taxes Other Total revenues Expenses 7.0 10.1 - - 7.0 10.1 Public safety General government 25.5 26.5 - - 25.5 26.5 Streets/Transportation 13.5 13.5 - - 13.5 13.5 Public works 2.7 2.8 - - 2.7 2.8 Culture and recreation 7.9 7.7 - - 7.9 7.7 Economic development 3.3 2.8 - - 3.3 2.8 Interest on long-term debt 2.3 2.5 - - 2.3 2.5 Water - - 0.3 0.3 0.3 0.3 Golf course - - 1.2 1.2 1.2 1.2 Sewer - - 9.4 9.1 9.4 9.1 - - 5.4 5.3 5.4 5.3 Total expenses Sanitation 62.2 65.9 16.3 15.9 78.5 81.8 Excess before transfer (9.0) (4.3) 0.1 1.3 (8.9) (3.0) 0.7 0.1 (0.7) (0.1) - - Transfers In (Out) Increase (decrease) in Net Position $ (8.3) $ (4.2) $ (0.6) $ 1.2 $ (8.9) $ (3.0) 12 To Table of Contents The following graph shows the functional revenues and expenses of governmental activities to demonstrate the extent to which the governmental functions produce direct revenues to offset the program costs. The expenses do not represent full cost allocation to these functions. Expenses not covered by direct program revenues are covered by general revenues of the City, primarily taxes and state shared revenues. Governmental activities account for 78% of the total revenues of the City and 80% of the total expenses in fiscal year 2015. This compares to 76% of total revenues and 79% of expenses in fiscal year 2014. Governmental Programs Revenues and Expenses FY2015 $30 Revenues Millions $25 Expenses $20 $15 $10 $5 $0 FINANCIAL ANALYSIS OF THE CITY’S FUNDS The City maintains fund accounting to demonstrate compliance with budgetary and legal requirements. The following is a brief discussion of financial highlights from the fund financial statements. Governmental Funds The focus of governmental fund financial statements (pages 24-33) is to provide information on near-term inflows, outflows and balances of spendable resources. All major governmental funds are discreetly presented in these financial statements, while the non-major funds are combined into a single column. Combining statements for the non-major funds may be found on pages 106-113. For fiscal year ended June 30, 2015, the governmental funds reflect a combined fund balance of $93.7 million, an increase of $7.4 million. A portion of the fund balance, $40.9 million is restricted for specific expenses or is legally segregated for a specific future use. The remaining $52.8 million is classified as assigned or unassigned. This balance may serve as a useful indicator of a government’s net resources available for spending at the end of the year. 13 To Table of Contents The following graph indicates fund balances for select governmental funds for the past two fiscal years. Governmental Fund Balances $35 $30 FY201 4 Millions $25 $20 $15 $10 $5 $0 The General Fund is the chief operating fund of the City and accounts for many of the major functions of the government, including public safety, community services, development services and general administrative services. The General Fund revenues total $41.0 million, an increase of $3.0 million, in fiscal year 2015. The primary increases are in charges for services, local sales taxes and state shared revenues. The expenses, before other financing sources and uses, totaled $36.4 million, a decrease of $0.7 million. Transfers to other funds were a net of ($165,649) resulting in an increase to fund balance of $4.5 million. The Highway User Revenue Fund is required by state statute to track the state allocation of gasoline taxes and other state revenues shared with local governments and must be used for transportation purposes only. The City also accounts for a half-cent sales tax that is collected and distributed by Pinal County for the purposes of construction and improvements of major roadways within the City. Revenue in this fund totaled $5.4 million, an increase of $0.4 million from the prior fiscal year, while expenses totaled $4.4 million, a decrease of $2.8 million in the fiscal year ended June 30, 2015. The Capital Development and Replacement Fund accounts for accumulated proceeds and capital expense of proceeds for the construction of capital projects and replacement of equipment. All non-major governmental funds of the City are combined into the “Non-Major Governmental Funds” column on the governmental fund statements. Proprietary Funds The proprietary funds financial statements are prepared on the same accounting basis and measurement focus as the government-wide financial statements, but provide additional detail since each enterprise fund is shown individually on the fund statement. 14 To Table of Contents Net position of the enterprise funds were $59.2 million, a decrease of $3.6 million as of June 30, 2015. Overall there is a $5.2 million decrease to unrestricted assets leaving a balance of $0.01 million. Operating revenues in fiscal year 2015 were $16.6 million, showing a $0.9 million increase from the prior fiscal year, while operating expenses totaled $13.9 million, a decrease of $0.3 million, resulting in a $2.8 million operating gain prior to nonoperating expenses, contributions, and transfers. BUDGETARY HIGHLIGHTS The City’s annual budget is the legally adopted expenditure control document of the City. A statement showing the budget amounts for the general fund is provided as required supplementary information on page 117. This statement compares the original adopted budget, the budget as amended throughout the fiscal year, and the actual expenditures prepared on a budgetary basis. Amendments to the adopted budget may occur throughout the year in a legally permissible manner (see Note 1 (E) on page 52 for more information on budget policies). Use of contingency is required for capital projects with budget overages, and other unanticipated expenses. Budget amendments are processed to provide expenditure authority from unanticipated revenue sources. These include new or increased grants and intergovernmental agreements. It is generally the policy of the City to not include revenues and operational expenditure authority for these types of items in the operational budgets unless the funding is reasonably assured at the time of completion of the annual budget. Instead, the City budgets contingency accounts to allow for later transfer to operational budgets when the funding is received. The City’s total adopted budget was $170,744,900 during fiscal year 2015. Budget amendments between funds or departments or from budgeted contingencies into operational expense/expenditure accounts did occur. However, the total adopted budget cannot be increased. General Fund inflows (revenues and other sources) of $41.0 million, on a budgetary basis, were nearly 6% more than budgeted inflows of $38.7 million, while actual outflows (expenditures and other uses) of $36.4 million were 91% of original budgeted outflows. CAPITAL ASSETS AND DEBT ADMINISTRATION Capital Assets As of June 30, 2015, the City had $299.6 million invested in various capital assets, net of accumulated depreciation. Of this amount, $192.3 million (64%) is invested in governmental activities and $107.3 million (36%) is invested in business-type activities. Major additions to capital assets during the fiscal year include the following:  Completion of major street improvements for $2.2 million.  Completion of additional Solar panel parking structure for $1.0 million.  Replacement vehicle purchases $1.8 million 15 To Table of Contents The following table provides a breakdown of the capital asset balances net of accumulated depreciation at June 30, 2015. Additional information on the City’s capital assets may be found in Note 7 on pages 64-65. Capital Assets (In Millions) Governmental Business-type Activities Activities 2014 Land & Construction in Progress $ 2015 19.7 $ 20.2 2014 $ Total 2015 3.0 $ 3.1 2014 $ 2015 22.7 $ 23.3 Construction in Progress Building & improvements Machines & equipment Total $ 174.3 164.3 97.2 94.2 271.5 258.5 7.3 7.8 10.0 10.0 17.3 17.8 201.3 $ 192.3 $ 110.2 $ 107.3 $ 311.5 $ 299.6 Long-Term Debt The City’s outstanding long-term debt, including bonds, notes, capital leases, compensated absences and new for FY2015 net pension costs, was $168.9 million at June 30, 2015, with $6.8 million due within one year. Of this total, $106.9 million was in governmental activities and $62.0 million was in business-type activities. Of the outstanding debt, $26.3 million is excise tax revenue obligation bond collateralized by the City’s excise tax stream. All other outstanding debt is secured by pledges of specific revenue sources of the City. With the implementation of GASB 68 Net Pension is included in the following table. The unfunded liability of our public safety retirement systems makes a significant impact on our total net position. The following schedule shows the outstanding debt of the City (both current and long term) as of June 30, 2015. Further details can be found in Notes 10 to 15 on pages 82-88. Outstanding Debt (In Millions) Governmental Business-type Activities Activities 2014 Compensated Absences $ Capital Leases 2.6 2015 $ 2.8 2014 $ 0.3 Total 2015 $ 0.3 2014 $ 2.9 2015 $ 3.0 7.5 8.1 47.7 0.1 55.1 8.2 43.1 42.7 12.3 10.2 55.4 52.9 Notes/Loans payable 0.0 0.0 0.0 44.2 0.0 44.2 Postclosure Liability 0.0 0.0 2.6 2.7 2.6 2.7 Net Pension 0.0 53.3 0.0 4.6 0.0 57.9 Bonds Payable/Excise Tax Obligations Total $ 53.2 $ 106.8 $ 62.9 $ 62.1 $ 116.1 $ 168.9 16 To Table of Contents ECONOMIC FACTORS Casa Grande’s population has grown steadily since 2000. The growth rate over the course of the past 10 years was 60%. The unemployment rate in Casa Grande (Pinal County) for June 2015 was approximately 8.4%, which is higher than both the state (7.5%) and the national averages (6.1%). The local economy has witnessed a solid year driven by commercial construction, new business and sustained increases in retail sales tax collections. Casa Grande remains the retail and commercial center of our region. Arizona cities remain dependent on sales taxes and other economically sensitive tax revenues such as franchise fees, state shared income taxes and state shared vehicle license taxes, as such, they are susceptible to slowdowns in the economy. Within Casa Grande, the local economy is experiencing a sustained increase in sales tax collection as the economy once again changes focus to spending and consumers take advantage of increased personal spending capabilities. In addition to the recent opening of a Sam’s Club, the Tractor Supply Company opened both a retail store and a regional distribution facility within the last year. Casa Grande is also the site for Phoenixmart, a global sourcing center which is expected to open within the next two years bringing thousands of permanent jobs to the area. After several years of decline, total assessed values for Casa Grande have once again began to climb, property values have nearly doubled from 2005 to 2015 increasing by 87%. For tax year 2015, the primary assessed value increased by 3.5% and is anticipated to continue increasing at a moderate pace next year. Residential values account for slightly more than one-third of the total assessed valuation. FINANCIAL CONTACT This financial report is designed to provide a general overview of the City of Casa Grande, Arizona’s finances and to demonstrate accountability for the use of public funds. Questions about any of the information provided in this report, or requests for additional information should be addressed to the City’s Finance Director at the following address: City of Casa Grande, 510 E. Florence Blvd. Casa Grande, AZ 85122 or send an e-mail to dsandstrom@casagrandeaz.gov. Copies of this report and other financial information can also be found on the city’s website www.casagrandeaz.gov. 17 To Table of Contents To Table of Contents FINANCIAL SECTION BASIC FINANCIAL STATEMENTS To Table of Contents To Table of Contents CITY OF CASA GRANDE, ARIZONA STATEMENT OF NET POSITION June 30, 2015 ASSETS Cash Investments Receivables (net of allowance for uncollectibles) Due from other governments Inventories Restricted cash and cash equivalents Capital assets-nondepreciable Capital assets-depreciable, net Total assets DEFERRED OUTFLOWS OF RESOURCES Deferred employer contributions to pensions Deferred outflows of resources related to pensions Total deferred outflows of resources LIABILITIES Accounts payable and other current liabilities Deposits held Accrued wages and benefits Accrued interest payable Noncurrent liabilities: Due within one year: Current portion of compensated absences Current portion of capital leases and notes Current portion of excise tax revenue obligations Current portion of bonds payable Due in more than one year: Noncurrent portion of compensated absences Noncurrent portion of capital leases and notes Noncurrent portion of excise tax revenue obligations Noncurrent portion of bonds payable Closure and postclosure liability Net pension liability Total liabilities DEFERRED INFLOWS OF RESOURCES Deferred inflows of resources related to pensions NET POSITION Net investment in capital assets Restricted for: Highways and streets Grant purposes Community development Debt service Capital projects Unrestricted Total net position See accompanying notes. Governmental Activities $ 5,504,375 85,977,184 5,313,601 650,192 298,789 1,229,683 20,251,305 172,074,883 291,300,012 Primary Government Business-type Activities Total $ 1,002,614 $ 6,506,989 10,870,320 96,847,504 3,494,951 8,808,552 650,192 27,622 326,411 1,229,683 3,132,175 23,383,480 104,235,662 276,310,545 122,763,344 414,063,356 3,746,738 5,937,899 9,684,637 263,026 233,412 496,438 4,009,764 6,171,311 10,181,075 1,280,668 12,975 1,428,115 434,435 437,525 13,381 173,119 558,532 1,718,193 26,356 1,601,234 992,967 1,241,289 543,783 802,755 820,000 118,905 2,546,957 707,322 - 1,360,194 3,090,740 1,510,077 820,000 1,517,131 7,537,984 15,166,039 25,951,206 53,258,803 109,995,183 145,329 41,603,848 9,645,267 2,737,164 4,592,644 63,279,993 1,662,460 49,141,832 24,811,306 25,951,206 2,737,164 57,851,447 173,275,176 4,210,648 810,820 5,021,468 142,734,104 52,862,580 195,596,684 6,414,070 1,024,548 5,572,411 4,290,966 23,560,096 3,182,623 $ 186,778,818 4,678,660 1,638,960 (11,231) $ 59,168,969 6,414,070 1,024,548 5,572,411 8,969,626 25,199,056 3,171,392 $ 245,947,787 21 To Table of Contents CITY OF CASA GRANDE, ARIZONA STATEMENT OF ACTIVITIES Year Ended June 30, 2015 Functions/Programs Primary government: Governmental activities: General government Public safety Streets/Transportation Public works Culture and recreation Economic development Interest on long-term debt Total governmental activities Expenses $ Business-type activities: Water Golf course Wastewater Sanitation Total business-type activities Total primary government $ 10,107,662 26,520,689 13,548,310 2,771,028 7,676,615 2,765,522 2,504,944 65,894,770 Program Revenues Operating Capital Charges for Grants and Grants and Services Contributions Contributions $ 2,815,852 1,076,004 816,829 167,447 430,294 1,647,495 6,953,921 261,674 1,195,987 9,119,769 5,386,901 15,964,331 192,343 1,100,780 8,541,358 6,739,816 16,574,297 81,859,101 $ 23,528,218 $ 126,548 431,089 5,363,099 76,474 358,210 420,547 6,775,967 - $ 6,775,967 $ 141,278 964,752 1,843,323 1,095,019 87,859 4,132,231 582,705 582,705 $ 4,714,936 General revenues: Property taxes Sales taxes Franchise taxes Shared revenues - unrestricted: State sales taxes Urban revenue sharing Auto-in-lieu Investment earnings Miscellaneous Transfers in (out) Total general revenues and transfers Change in net position Net position-beginning - restated Net position-ending See accompanying notes. 22 To Table of Contents Net (Expense) Revenue and Changes in Net Position Governmental Activities $ (7,023,984) (24,048,844) (5,525,059) (1,432,088) (6,800,252) (697,480) (2,504,944) (48,032,651) Business-type Activities $ $ (48,032,651) $ 1,192,671 $ 59,168,969 (46,839,980) 6,366,087 21,825,012 2,358,731 11,680 72,228 (78,030) 35,000 1,227,671 57,941,298 $ (7,023,984) (24,048,844) (5,525,059) (1,432,088) (6,800,252) (697,480) (2,504,944) (48,032,651) (69,331) (95,207) 4,294 1,352,915 1,192,671 29,122 - 4,438,843 5,879,820 2,447,783 174,864 282,850 78,030 43,822,898 (4,209,753) 190,988,571 186,778,818 $ (69,331) (95,207) 4,294 1,352,915 1,192,671 6,366,087 21,795,890 2,358,731 $ - Total 4,438,843 5,879,820 2,447,783 186,544 355,078 43,857,898 (2,982,082) 248,929,869 $ 245,947,787 23 To Table of Contents CITY OF CASA GRANDE, ARIZONA BALANCE SHEET GOVERNMENTAL FUNDS June 30, 2015 ASSETS Cash Investments Accounts receivable (less allowance for uncollectibles) Due from other governments Due from other funds Inventories Restricted assets: Cash and cash equivalents Total assets LIABILITIES Accounts payable and other current liabilities Accrued wages and benefits Due to other funds Total liabilities DEFERRED INFLOWS OF RESOURCES Deferred revenues Total deferred inflows of resources FUND BALANCES Nonspendable Restricted Committed Assigned Unassigned Total fund balances Total liabilities, deferred inflows of resources and fund balances See accompanying notes. Capital Replacement/ Recreation/ Development $ 771,758 25,666,960 General $ 476,719 26,670,455 Highway Users $ 865,985 5,068,258 3,232,990 419,490 1,067,545 1,647 644,931 - 666,594 82,037 19,932 126,682 $ 31,950,883 $ 6,599,106 $ 27,231,994 $ $ $ 474,814 1,366,194 1,841,008 207,444 207,444 118,973 66,063 185,036 - - 385,436 385,436 - 1,647 5,572,411 12,631,345 11,697,028 29,902,431 6,414,070 6,414,070 126,682 26,719,876 26,846,558 $ 31,950,883 $ 6,599,106 $ 27,231,994 24 To Table of Contents Non-Major Governmental Funds $ 1,337,045 28,449,191 Total Governmental Funds $ 3,451,507 85,854,864 726,635 230,702 36,281 5,271,150 650,192 1,067,545 37,928 1,001,032 1,229,683 $ 31,780,886 $ 97,562,869 $ $ 219,563 32,005 847,796 1,099,364 122,805 122,805 36,281 28,751,138 2,364,620 (593,322) 30,558,717 $ 31,780,886 1,198,786 1,464,262 847,796 3,510,844 330,249 330,249 37,928 40,864,301 41,715,841 11,103,706 93,721,776 $ 97,562,869 25 To Table of Contents To Table of Contents CITY OF CASA GRANDE, ARIZONA RECONCILIATION OF THE BALANCE SHEET TO THE STATEMENT OF NET POSITION GOVERNMENTAL FUNDS June 30, 2015 Fund balance - total governmental funds balance sheet $93,721,776 Amounts reported for governmental activities in the statement of net assets are different because: Capital assets used in governmental activities are not financial resources and therefore are not reported in the governmental funds. Governmental capital assets Less accumulated depreciation Internal service capital assets Less accumulated depreciation Long-term liabilities, including bonds payable, are not due and payable in the current period and therefore are not reported in the funds. Compensated absences Capital leases Bonds payable Net pension liability Delayed revenue is shown on the governmental funds, but is not on the statement of net position. Grants Property Tax Deferred outflows and inflows of resources related to pensions and deferred charges on debt refundings are applicable to future reporting periods and, therefore, are not reported in the funds. Deferred outflows of resources related to pensions Deferred outflows of employer contributions Deferred inflows of resources related to pensions Interest payable on long-term debt is not reported in the governmental funds. Internal service funds are used by management to charge the costs of certain activities to individual funds. The assets and liabilities of the internal service funds (excluding capital assets) are reported with governmental activities. Net position of governmental activities - statement of net position See accompanying notes. $ 348,518,409 (156,194,293) 360,090 (358,018) (2,714,213) (8,081,767) (42,740,000) (53,258,803) 122,805 207,444 5,937,899 3,746,738 (4,210,648) 192,326,188 (106,794,783) 330,249 5,473,989 (434,435) 2,155,834 $186,778,818 27 To Table of Contents CITY OF CASA GRANDE, ARIZONA STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS Year Ended June 30, 2015 Capital Replacement/ Non-Major Total Recreation/ Governmental Governmental Highway REVENUES General Users Development Funds Funds Taxes: Property taxes $ 3,423,739 $ $ $ 2,782,546 $ 6,206,285 City sales tax 18,829,292 2,704,573 262,025 21,795,890 Franchise tax 2,555,177 2,555,177 Licenses and permits 1,344,254 1,344,254 Intergovernmental revenues 12,864,754 5,363,099 1,097,116 19,324,969 Charges for services 879,543 3,181,862 4,061,405 Fines 682,288 682,288 Investment earnings 54,626 16,781 115,872 20,554 207,833 Contributions and donations 42,901 220,056 262,957 Rental and sale of city property 150,461 611,034 761,495 Miscellaneous 202,247 2,748 256,408 96,839 558,242 Total revenues 41,029,282 5,382,628 3,076,853 8,272,032 57,760,795 EXPENDITURES Current: General government Public safety Streets/Transportation Public works Culture and recreation Planning and economic development Capital outlay Debt service: Principal Interest and fiscal charges Total expenditures Excess (deficiency) of revenues over (under) expenditures 6,763,231 20,843,348 1,313,886 5,589,731 1,774,910 122,405 2,821,113 1,451,949 38,583 4,495,387 1,047,222 537,255 568,110 501,815 819,984 7,810,453 21,380,603 2,821,113 1,352,469 6,157,841 2,276,725 6,889,725 36,407,511 60,718 38,063 4,371,843 257,604 247,737 5,039,311 1,641,483 2,234,893 7,350,762 1,959,805 2,520,693 53,169,427 4,621,771 1,010,785 (1,962,458) 921,270 4,591,368 OTHER FINANCING SOURCES (USES) Transfers in Transfers out Lease purchase proceeds Total other financing sources and uses 2,041,606 (2,207,255) (165,649) 129,879 (532,900) (403,021) 1,375,923 (786,646) 1,095,019 1,684,296 2,266,387 (610,536) 1,655,851 5,813,795 (4,137,337) 1,095,019 2,771,477 Net change in fund balances 4,456,122 607,764 (278,162) 2,577,121 7,362,845 25,446,309 5,806,306 27,124,720 27,981,596 86,358,931 $ 29,902,431 $ 6,414,070 $ 26,846,558 $ 30,558,717 $ 93,721,776 Fund balances - beginning of year Fund balances - end of year See accompanying notes. 28 To Table of Contents CITY OF CASA GRANDE, ARIZONA RECONILIATION OF THE STATEMENT OF REVENUES, EXPENDTURES, AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES Year Ended June 30, 2015 Net change in fund balances - total governmental funds $7,362,845 Amounts reported for governmental activities in the statement of activities are different because: Governmental funds report capital outlays as expenditures. However, in the statement of activities the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense. This is the amount by which capital outlay exceeded depreciation in the current period. Contributions Expenditures for capital assets Less current year depreciation 435,329 5,602,983 (14,994,187) (8,955,875) The net effect of various miscellaneous transactions involving capital assets (i.e., sales, trade-ins, and donations) is to decrease net assets. Sale of capital assets (21,892) Revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the funds. Property taxes and grants (30,962) Town pension contributions are reported as expenditures in the governmental funds when made. However, they are reported as deferred outflows of resources in the Statement of Net Position because the reported net pension liability is measured a year before the Town's report date. Pension expense, which is the change in the net pension liability adjusted for changes in deferred outflows and inflows of resources related to pensions, is reported in the Statement of Activities. City pension contributions Pension expense 3,746,738 (6,144,619) Bond discounts are expended in the governmental funds when paid, and are capitalized and amortized in the statement of net position. This is the amount of current year bond discount. The issuance of long-term debt (e.g., bonds, leases) provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction has any effect on net assets. Issuance of lease debt Bond payments Lease payments (8,604) (1,095,019) 1,475,718 484,087 The internal service fund net revenue is reported with governmental activities Some expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds. Transfer of debt Compensated absences Interest expense on long-term debt Change in net position of governmental activities See accompanying notes. (2,397,881) 864,786 276,998 (1,133,770) (127,942) (37,456) (1,299,168) ($4,209,753) 29 To Table of Contents CITY OF CASA GRANDE, ARIZONA GENERAL FUND STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended June 30, 2015 Budgeted Amounts REVENUES Taxes: Property taxes City sales tax Franchise tax Licenses and permits Intergovernmental revenues Charges for services Fines Investment earnings Contributions and donations Rental and sale of city property Miscellaneous Total revenues EXPENDITURES Current: General government Mayor and Council City manager Attorney Clerk Finance Information technology Administrative services Public safety Police Fire Court Animal control Public works Culture and recreation Planning and economic development Capital outlay Debt service: Principal Total expenditures Excess (deficiency) of revenues over (under) expenditures See accompanying notes. Variance with Final Budget- Original Final Actual Amounts $ 3,251,900 17,310,300 2,380,000 1,226,400 12,673,000 816,000 711,500 103,000 35,500 168,000 74,000 38,749,600 $ 3,251,900 17,310,300 2,380,000 1,226,400 12,673,000 816,000 711,500 103,000 35,500 168,000 74,000 38,749,600 $ 3,423,739 18,829,292 2,555,177 1,344,254 12,864,754 879,543 682,288 54,626 42,901 150,461 202,247 41,029,282 2,012,400 827,700 813,700 421,900 1,057,200 1,751,600 738,300 2,012,400 827,700 813,700 421,900 1,057,200 1,709,100 748,300 1,463,433 793,395 778,665 355,685 1,054,492 1,653,595 663,966 548,967 34,305 35,035 66,215 2,708 55,505 84,334 13,169,800 7,388,000 613,300 356,300 1,438,700 5,677,500 1,990,600 1,750,500 13,163,400 7,396,000 618,300 356,300 1,472,500 5,754,800 1,990,600 1,875,700 12,505,153 7,370,209 616,119 351,867 1,313,886 5,589,731 1,774,910 122,405 658,247 25,791 2,181 4,433 158,614 165,069 215,690 1,753,295 95,200 40,102,700 40,217,900 36,407,511 3,810,389 (1,353,100) (1,468,300) 4,621,771 6,090,071 $ 171,839 1,518,992 175,177 117,854 191,754 63,543 (29,212) (48,374) 7,401 (17,539) 128,247 2,279,682 30 To Table of Contents OTHER FINANCING SOURCES (USES) Transfers in Transfers out Total other financing sources and uses Net change in fund balance Fund balance - beginning of year Fund balance - end of year 2,184,700 (2,679,600) (494,900) 2,184,700 (2,670,900) (486,200) 2,041,606 (2,207,255) (165,649) (1,848,000) (1,954,500) 4,456,122 25,446,309 25,446,309 25,446,309 $ 23,598,309 $ 23,491,809 $ 29,902,431 (143,094) 463,645 320,551 6,410,622 $ 6,410,622 31 To Table of Contents To Table of Contents CITY OF CASA GRANDE, ARIZONA HIGHWAY USERS SPECIAL REVENUE FUND STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended June 30, 2015 Budgeted Amounts REVENUES Taxes: State-shared gas tax County sales tax Investment earnings Miscellaneous Total revenues Original $ EXPENDITURES Streets/Transportation Personal services Contractual services Materials and supplies Capital outlay Debt service Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING USES Transfers in Transfers out Total other financing sources and uses Net change in fund balance Fund balance - beginning of year Fund balance - end of year See accompanying notes. 3,333,800 1,700,000 1,000 5,000 5,039,800 $ Actual Amounts Variance with Final Budget- 3,333,800 1,700,000 1,000 5,000 5,039,800 $ $ 3,495,217 1,867,882 16,781 2,748 5,382,628 161,417 167,882 15,781 (2,252) 342,828 1,333,900 526,100 972,700 1,859,700 167,200 1,333,900 598,300 972,700 1,822,900 98,800 1,297,796 590,290 933,027 1,451,949 98,781 36,104 8,010 39,673 370,951 19 4,859,600 4,826,600 4,371,843 454,757 180,200 213,200 1,010,785 797,585 (532,900) (532,900) 129,879 (532,900) 129,879 - (532,900) (532,900) (403,021) 129,879 (352,700) (319,700) 607,764 927,464 5,806,306 $ Final 5,453,606 5,806,306 $ 5,486,606 5,806,306 $ 6,414,070 $ 927,464 33 To Table of Contents CITY OF CASA GRANDE, ARIZONA STATEMENT OF NET POSITION PROPRIETARY FUNDS June 30, 2015 ASSETS Current assets: Cash Investments Receivables, net of uncollectibles Inventories Total current assets Noncurrent assets: Capital assets-nondepreciable Capital assets-depreciable Total noncurrent assets Total assets Business-type ActivitiesEnterprise Funds Water $ DEFERRED OUTFLOWS OF RESOURCES Deferred outflows of employer contributions to pensions Deferred outflows of resources related to pensions Total deferred outflows of resources LIABILITIES Current liabilities: Accounts payable Deposits held Accrued wages and benefits Accrued interest payable Due to other funds Compensated absences Notes/Loans payable Excise tax revenue obligations Total current liabilities Noncurrent liabilities: Compensated absences Notes/Loans payable Excise tax revenue obligations Closure and postclosure liability Net pension liability Total noncurrent liabilities Total liabilities DEFERRED INFLOWS OF RESOURCES Deferred inflows of resources related to pensions NET POSITION Net investment in capital assets Restricted for: Debt service Construction Unrestricted Total net position See accompanying notes. $ 590,083 5,719 595,802 Wastewater $ 206,925 5,764,051 1,759,178 7,730,154 3,214 570,814 574,028 1,169,830 91,422,474 91,422,474 99,152,628 5,360 4,757 10,117 64,448 57,191 121,639 23,403 13,381 1,818 1,191 12,943 52,736 223,741 41,376 557,341 17,217 2,534,014 707,322 4,081,011 56,375 93,595 149,970 202,706 21,044 41,547,473 9,645,267 1,125,306 52,339,090 56,420,101 16,524 198,670 504,710 37,110,037 456,007 4,678,660 866,799 960,717 $ 42,655,496 34 To Table of Contents Wastewater Dev Fees $ 5,157 1,633,803 1,638,960 Business-type Activities-Enterprise Funds Sanitation $ 2,845,961 5,061,725 7,907,686 9,546,646 $ 48,410 442 3,557 27,622 80,031 Total $ 1,002,614 10,870,320 3,494,951 27,622 15,395,507 $ 2,052,867 122,320 42,451 260,861 2,478,499 5,485,354 5,485,354 10,835,914 283,000 1,695,295 1,978,295 2,058,326 3,132,175 104,235,662 107,367,837 122,763,344 - 172,650 153,211 325,861 20,568 18,253 38,821 263,026 233,412 496,438 - 157,464 124,584 101,047 383,095 32,917 5,341 641 38,899 437,525 13,381 173,119 558,532 118,905 2,546,957 707,322 4,555,741 90,098 (31,388) 219,750 44,205 322,665 - 123,502 2,737,164 3,014,601 5,875,267 6,258,362 783 359,142 359,925 398,824 145,329 41,603,848 9,645,267 2,737,164 4,592,644 58,724,252 63,279,993 322,665 - 532,221 63,405 810,820 5,361,852 1,978,295 52,862,580 7,907,686 1,638,960 $ 152,039 3,472,024 1,726,497 5,350,560 Golf Course Governmental Activities Internal Service Funds 9,546,646 (990,660) $ 4,371,192 (343,377) $ 1,634,918 2,072 2,072 2,480,571 - 2,072 4,678,660 1,638,960 (11,231) $ 59,168,969 2,155,834 $ 2,157,906 35 To Table of Contents CITY OF CASA GRANDE, ARIZONA STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET POSITION PROPRIETARY FUNDS Year Ended June 30, 2015 Business-type ActivitiesEnterprise Funds Operating revenues: Service fees Department Insurance charges Rental Green fees Miscellaneous Total operating revenue Water $ Operating expenses: Personal services Contractual services Materials and supplies Depreciation Closure and postclosure costs Total operating expenses 192,343 192,343 Wastewater $ 8,541,358 70,663 8,612,021 36,751 89,109 70,317 64,433 260,610 844,978 1,103,217 1,595,728 3,373,418 6,917,341 (68,267) 1,694,680 (1,064) (1,064) 7,480 (2,115,738) (2,108,258) Income (loss) before contributions and transfers (69,331) (413,578) Developer fees Contributions Transfers in Transfers out Change in net position Total net position-beginning of year-restated (36,600) (105,931) 1,066,648 155,000 (523,300) (781,878) 43,437,374 Operating income (loss) Nonoperating revenues (expense): Investment earnings Interest expense City sales tax Total nonoperating revenues (expense) Total net position-end of year See accompanying notes. $ 960,717 $ 42,655,496 36 To Table of Contents Wastewater Dev Fees $ Business-type Activities-Enterprise Funds - Sanitation $ 86,690 86,690 2,422,642 1,206,098 735,587 925,566 97,008 5,386,901 (86,690) 1,352,915 1,208 1,208 1,355,907 582,705 (155,000) 342,223 9,204,423 9,546,646 $ 2,992 2,992 (85,482) $ 6,739,796 20 6,739,816 Golf Course $ 4,371,192 139,630 961,150 1,565 1,102,345 $ 15,473,497 139,630 961,150 72,248 16,646,525 112,378 649,900 252,649 181,060 1,195,987 3,416,749 3,048,324 2,654,281 4,631,167 97,008 13,847,529 823,980 1,875,780 805,232 14,802 3,519,794 (93,642) 2,798,996 741,656 29,122 29,122 11,680 (2,116,802) 29,122 (2,076,000) (64,520) (548,000) 807,907 3,563,285 1,133,770 (103,900) 965,350 669,568 $ Total Governmental Activities Internal Service Funds 1,634,918 $ - 722,996 741,656 582,705 1,133,770 155,000 (1,366,800) 1,227,671 57,941,298 $ 59,168,969 1,804,516 2,335,297 121,637 4,261,450 37,766 (502,424) 276,998 1,880,908 $ 2,157,906 37 To Table of Contents CITY OF CASA GRANDE, ARIZONA STATEMENT OF CASH FLOWS PROPRIETARY FUNDS Year Ended June 30, 2015 CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers and users Payments to suppliers Payments to employees Net cash provided by operating activities Business-type ActivitiesEnterprise Funds Water $ CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES City sales tax Transfers to other funds Transfers from other funds Net cash provided by noncapital financing activities CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Purchases of capital assets Contributions Principal paid on capital debt Interest paid on capital debt Net cash provided (used) by capital and related financing activities Wastewater 195,551 (143,517) (36,023) 16,011 $ 8,882,745 (2,971,926) (842,314) 5,068,505 (36,600) - (523,300) 155,000 (36,600) (368,300) (3,215) (12,513) (2,597) (422,477) (3,057,525) (2,217,510) (18,325) (5,697,512) CASH FLOWS FROM INVESTING ACTIVITIES Interest and dividends received Net cash provided by investing activities - 7,480 - 7,480 Net increase (decrease) in cash (38,914) Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year Cash Investments See accompanying notes. (989,827) 628,997 6,960,803 $ 590,083 $ 5,970,976 $ 590,083 - $ 206,925 5,764,051 $ 590,083 $ 5,970,976 38 To Table of Contents Wastewater Dev Fees $ Business-type Activities-Enterprise Funds - Sanitation $ 6,002,879 (2,173,905) (2,369,586) 1,459,388 Golf Course $ Total 1,103,285 (883,730) (164,103) 55,452 $ 16,184,460 (6,173,078) (3,412,026) 6,599,356 Governmental Activities Internal Service Funds $ 4,254,963 (2,702,278) (1,151,809) 400,876 (155,000) - (548,000) - 29,122 (103,900) - 29,122 (1,366,800) 155,000 (502,424) 37,766 (155,000) (548,000) (74,778) (1,182,678) (464,658) (298,432) 582,705 - (1,066,399) - (10,635) - (1,801,158) 582,705 (3,070,038) (2,220,107) - 284,273 (1,066,399) (10,635) (6,508,598) - 1,208 2,992 - 11,680 - 1,208 2,992 - 11,680 - 130,481 (152,019) 1,508,479 3,776,082 (29,961) (1,080,240) 78,813 12,953,174 (63,782) 2,238,969 $ 1,638,960 $ 3,624,063 $ 48,852 $ 11,872,934 $ 2,175,187 $ 5,157 1,633,803 $ 152,039 3,472,024 $ 48,410 442 $ 1,002,614 10,870,320 $ 2,052,867 122,320 $ 1,638,960 $ 3,624,063 $ 48,852 $ 11,872,934 $ 2,175,187 39 To Table of Contents CITY OF CASA GRANDE, ARIZONA STATEMENT OF CASH FLOWS PROPRIETARY FUNDS (CONTINUED) Year Ended June 30, 2015 Business-type ActivitiesEnterprise Funds Reconciliation of operating income (loss) to net cash provided by operating activities: Operating income (loss) Adjustments to reconcile operating income (loss) to net cash provided by operating activities: Closure and postclosure costs Depreciation expense Pension expense Employer pension contributions Provision for bad debt (Increase) decrease in accounts receivable (Increase) decrease in inventory Increase (decrease) in accounts payable Increase (decrease) in deposits held Increase (decrease) in accrued wages Increase (decrease) in due to other funds Increase (decrease) in compensated absences Total adjustments Net cash provided by operating activities Water $ (68,267) Wastewater $ 64,433 6,091 (5,360) 1,673 15,909 1,535 (3) - 3,373,418 73,230 (64,448) 1,818,174 (1,547,450) (132,708) 2,703 (140,273) (8,821) 3,373,825 84,278 $ 16,011 1,694,680 $ 5,068,505 Schedule of Noncash Investing, Capital and Financing Activities The Golf Course fund transferred $1,133,770 in debt to Governmental Activities See accompanying notes. 40 To Table of Contents Wastewater Dev Fees $ (86,690) Sanitation $ 86,690 86,690 $ - Total Governmental Activities Internal Service Fund 2,798,996 $ Business-type Activities-Enterprise Funds 1,352,915 Golf Course $ 97,008 925,566 196,177 (172,650) 985,163 (1,722,100) (232,220) 20,908 8,621 106,473 $ 1,459,388 (93,642) $ 181,060 23,372 (20,568) 940 25,700 (6,881) (15,576) (38,953) 149,094 $ 55,452 97,008 4,631,167 298,870 (263,026) 2,803,337 (3,266,937) 25,700 (355,900) 1,535 8,032 (140,273) (39,153) 3,800,360 $ 6,599,356 741,656 14,802 (6,487) (54,228) (44,650) (328,688) 77,612 859 (340,780) $ 400,876 41 To Table of Contents CITY OF CASA GRANDE, ARIZONA STATEMENT OF FIDUCIARY NET POSITION FIDUCIARY FUNDS June 30, 2015 ASSETS Cash Investments Agency Funds $ 61,004 1,948,066 Part-Time Firemen's Pension $ 2,372 426,474 Total assets 2,009,070 LIABILITIES Other liabilities 2,009,070 - 2,009,070 - Total liabilities NET POSITION Held in trust for pension benefits and other purposes See accompanying notes. $ - 428,846 $ 428,846 42 To Table of Contents CITY OF CASA GRANDE, ARIZONA STATEMENT OF CHANGES IN FIDUCIARY NET POSITION FIDUCIARY FUNDS Year Ended June 30, 2015 ADDITIONS Contributions: Employer Plan members Total contributions Part-Time Firemen's Pension $ Investment earnings: Misc revenue Total additions (22,700) (22,700) DEDUCTIONS Administrative expenses Total deductions 1,814 1,814 Change in net position (24,514) Net position-beginning of year Net position-end of year See accompanying notes. - 453,360 $ 428,846 43 To Table of Contents To Table of Contents FINANCIAL SECTION NOTES TO FINANCIAL STATEMENTS To Table of Contents To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accounting policies and financial reporting practices of the City conform to accounting principles generally accepted in the United States of America 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. The following is a summary of the City’s significant accounting policies. A. Reporting Entity The reporting entity of the City includes the following services as authorized by its charter: general government, public safety (police, court and fire), streets/transportation, public works, culture and recreation and economic development. In addition, the City owns and operates four major enterprise activities: wastewater system, sanitation operations, golf course and water system. Individual Component Units – Blended The Mission Royale Community Facilities District, Villago Community Facilities District, Copper Mountain Community Facilities District and Post Ranch Community Facilities District (the Districts) were formed for the purpose of acquiring or constructing public infrastructure in specific geographic areas of the City. As special purpose districts and separate political subdivisions under the Arizona Constitution, the Districts can levy taxes and issue bonds independently of the City. Property owners in the designated areas are assessed for District taxes, and thus for the costs of operating the Districts. The City Council serves as the Board of Directors; however, the City has no liability for the District’s debt. For reporting purposes, the transactions of the Districts are combined together and included as governmental type funds as if they were part of the City’s operations. No separate financial statements were prepared for the Districts. B. Government-Wide and Fund Financial Statements The government-wide financial statements (i.e., the statement of net assets and the statement of activities) report information on all of the non-fiduciary activities of the primary government and its component units. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from Business-type activities, which rely on fees and charges for support. The statement of activities demonstrates the degree to which the direct expenses for a given function or segments 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 or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. 47 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) B. Government-Wide and Fund Financial Statements (Continued) Taxes and other items not properly included among program revenues are reported instead as general revenues. Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds, even though the latter are excluded from the governmentwide financial statements. Major individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements. A fund is considered a major fund if it meets several threshold tests based on size and proportionate share. Generally, the effect of interfund activity is removed from the government-wide financial statements. Net interfund activity and balances between governmental activities and businesstype activities are shown in the government-wide financial statements. The “doubling up” effect of internal service fund activity is removed from the government-wide statements with the expenses shown in the various functions and segments on the Statement of Activities. C. Basis of Presentation – Fund Accounting The accounts of the City are organized on the basis of funds, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, fund equity, revenues and expenditures (expenses). The various funds are summarized by type in the combined financial statements. The City uses the following fund types: GOVERNMENTAL FUNDS General Fund - The General Fund is the chief operating fund of the City. It is used to account for all financial resources except for those required to be accounted for in another fund. Special Revenue Funds - The Special Revenue Funds are used to account for revenues derived from specific taxes, grants or other restricted revenue sources. City Ordinances or Federal and State Statutes specify the uses and limitations of each special revenue fund. The Highway Users Fund that accounts for the City's share of tax revenues legally restricted to the maintenance of the highways within the City's boundaries, is presented as a major fund in the basic financial statement. Debt Service Funds - Debt Service Funds account for the accumulation of resources for and the payment of general obligation long-term debt principal, interest and related costs. Capital Project Funds - Capital Project Funds account for financial resources used for the acquisition or construction of major capital facilities (other than those financed by proprietary funds and trust funds). The Capital Replacement/Recreation/Development Fund is a major fund presented in the basic financial statements. This fund accounts for the replacement of fleet, recreation facilities construction and development of infrastructure. 48 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) C. Basis of Presentation – Fund Accounting (Continued) PROPRIETARY FUNDS Enterprise Funds - Enterprise Funds account for operations financed and operated in a manner similar to private business enterprises - the intent of the governing body is for the costs of providing the specific service to the general public on a continuing basis be financed or recovered primarily through user charges. The enterprise funds presented as major funds in the basic financial statement are as follows: Water Fund - accounts for the Copper Mountain water related activities. Wastewater Fund - accounts for the activities of the wastewater treatment, operations and maintenance. Wastewater Development Fees Fund - impact fees pay their proportionate share for development of the wastewater system. Sanitation Fund - accounts for the operations of the City’s trash and landfill services. Golf Course Fund - accounts for the operations of the City’s public golf course. On the proprietary fund financial statements, operating revenues are those that flow directly from the operations of that activity, i.e. charges to customers or users who purchase or use the goods or services of that activity. Operating expenses are those that are incurred to provide those goods or services. Non-operating revenues and expenses are items like investment income and interest expense that are not a result of the direct operations of the activity. 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, generally on a cost-reimbursement basis. The City has three internal services funds: Fleet Maintenance is used to account for the maintenance and operations of City owned vehicles, Facilities Maintenance is used to account for the maintenance and operations of City owned buildings, and Risk Management is used for property and casualty insurance activities. Each cost center is charged their proportional share of the cost for these services. 49 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 1 C. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Basis of Presentation – Fund Accounting (Continued) FIDUCIARY FUNDS Fiduciary funds account for assets held by the City in a trustee or agency capacity on behalf of others and therefore are not available to support City programs. The reporting focus is upon net assets and changes in net assets and employs accounting principles similar to proprietary funds. Fiduciary Funds are not included in the government-wide financial statements since they are not assets of the City available to support City programs. Pension Trust Funds are used to report resources that are required to be held in trust for the members and beneficiaries of defined benefit pension plans, defined contribution plans, other post-employment benefit plans, or other employee benefit plans. The City has one Pension Trust Fund to account for the activities of the part-time firemen’s pension plan. Agency Funds account for assets the City holds as an agent for individuals, private organizations, other governments or other funds in a temporary custodial capacity. The City currently maintains three agency funds, one to account for deposits received from various businesses in order to conduct business within the City, one to account for employee deposits into a flexible spending plan, and a third to account for the Sun Corridor MPO. The three agency funds are aggregated in the statements. D. Measurement Focus, Basis of Accounting, and Financial Statement Presentation Different measurement focuses are applied to governmental, proprietary and fiduciary funds. The governmental fund measurement focus is on determination of financial position and changes in financial position. Governmental funds focus on the flow of resources. The proprietary and pension fund measurement focus is on determination of net income, financial position, and changes in financial position. Agency funds are custodial in nature and do not measure results of operation or have a measurement focus. The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. The modified accrual basis of accounting is followed by the governmental funds. Revenues are recorded when susceptible to accrual, i.e., both measurable and available. Available means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. 50 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 1 D. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Measurement Focus, Basis of Accounting, and Financial Statement Presentation (Continued) The City considers revenues available if they are earned by June 30 and the revenue is expected to be collected within 60 days after year-end. Expenditures are recorded when the related fund liability is incurred. Principal and interest on general long-term debt are recorded as fund liabilities when due or when amounts have been accumulated in the debt service fund for payments to be made early in the following year. In applying the susceptible to accrual concept to intergovernmental revenues (grants, subsidies and shared revenues), the legal and contractual requirements of the numerous individual programs are used as guidance. There are essentially two types of these revenues. In one, monies must be expended on the specific purpose of the project before any amounts will be paid to the City; therefore, revenues are recognized based upon the expenditures recorded. In the other legal and contractual arrangement, monies are virtually unrestricted as to purpose of expenditures and nearly irrevocable, i.e., revocable only for failure to comply with prescribed compliance requirements, e.g., equal employment opportunity. These resources are reflected as revenues at the time of receipt or earlier if they meet the criterion of availability. Licenses and permits, charges for services, fines, forfeitures and miscellaneous revenues are recorded as revenues when received. Investment interest is recorded as earned since they are measurable and available. City sales tax, collected by the State of Arizona and property taxes are accrued in the accounting period they become both measurable and available. The portion of property tax levies available on June 30, 2015, are recorded as receivable, net of allowance for un-collectibles. The balance of the tax levy not collected within 60 days after year-end are reflected as deferred revenue. Notes receivables are recorded as revenue as installments are received. The balances of these receivables are reflected as deferred revenue. Direct loans made through Community Development Block Grants are reflected as a reserve in fund balance. All proprietary and pension funds are accounted for using the accrual basis of accounting. Under the accrual basis of accounting, revenues are recognized in the accounting period in which they are earned and become measurable. Expenses are recorded in the accounting period incurred. The preparation of the basic financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the basic financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. 51 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 1 E. Budgetary Data           F. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) In the spring of each year, the City Manager submits to City Council an estimate of the expenditures necessary to conduct the affairs of the City for the fiscal year commencing July 1st. The Council holds open work sessions relating to budget preparation. After required public hearings are held, a budget for all governmental and proprietary funds (excluding internal service and pension funds) is legally enacted prior to the third Monday of July as required by Arizona Revised Statutes. The budget specifies expenditure amounts by activity with each Fund. Transfer of budgeted amounts within a department may be authorized by the Director of each department, unless the transfer involves personnel services. This type of budgetary transfer requires City Manager approval. In the adoption of the budget the City Council delegates authority to transfer budget amounts between funds and departments to the City Manager. The original budget was amended for the year ending June 30, 2015. All funds are subject to the comprehensive appropriated budget. Encumbrances used by the City during the budget year. All appropriations lapse at fiscal year-end unless re-appropriated as a carry-over. Invoices for goods and services received on or before June 30 must be paid within 60 days of the fiscal year-end. The budget for the City is adopted on a basis consistent with generally accepted accounting principles. Under State statutes, certain annual expenditure limitations must be adhered to. Several supplemental appropriations were necessary during the year. Expenditures may not exceed budgeted appropriations at the total budget level. Cash and Cash Equivalents Cash represents amounts in demand deposits and amounts held in trust by financial institutions. The funds held in trust are available to the City upon demand. Cash equivalents are defined as short-term (original maturities of three months or less), highly liquid investments that are 1) readily convertible to known amounts of cash and 2) so near maturity that they present insignificant risk of changes in value because of changes in interest rates. 52 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 1 G. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Investments The City adheres to the Arizona Revised Statutes (A.R.S. §35-323) that governs the investment of City funds. Eligible investments include certificate of deposits in eligible depositories, interest bearing accounts in qualified banks, repurchase agreements, pooled investments by the State Treasurer, bonds of the U.S. Government that are guaranteed as to principal and interest, and bonds of the state, city, town or school district. The State’s investment pool is managed by the State Treasurer’s office. The pool is not required to register with the Securities and Exchange Commission under the 1940 Investments Advisors Act. The activity and performance of the pool is reviewed monthly by the State Board of Investment in accordance with A.R.S. §35-311. The Arizona State Treasurer issues a publicly available financial report that includes financial statements and required supplementary information. Copies may be obtained by contacting the Arizona State Treasurer, 1700 West Washington, Phoenix, Arizona 85007. In accordance with GASB Statement No. 31 “Accounting and Financial Reporting for Certain Investments and External Investment Pools,” the City records all its investments at fair value as defined in the statement. The Part-time Firemen’s Pension investments are valued from quoted market prices at year-end. H. Inventory Inventories for governmental and proprietary funds consist primarily of expendable supplies. Governmental funds maintain inventories using the consumption method of accounting. All inventories are valued at cost, which approximates market, using the first-in/first-out method. Physical inventories are conducted at year-end for financial statements purposes. I. Capital Assets Capital Assets, which include property, plant, equipment, and infrastructure assets (e.g., roads, sidewalks and similar items), are reported in the applicable governmental or business-type activities columns in the government-wide financial statements. Capital assets are defined by the City as assets with an initial, individual cost of more than $10,000 and an estimated useful life in excess of one year. Assets contributed (donated) to those funds are recorded by reference to historical costs of the donor if recently purchased or constructed, or if such records are not available, at estimated fair market value on the date of receipt. General government infrastructure capital assets include those assets acquired or constructed since 1980. The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets lives are not capitalized. 53 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 1 I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Capital Assets (Continued) Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest incurred during the construction phase of capital assets of business-type activities is included as part of the capitalized value of the assets constructed. Depreciation of all assets is recorded and calculated using the straight-line method over the following estimated useful lives: Buildings Sewer system Street system Building and facility improvements Streetlights and traffic control devices Other Improvements and landscaping Vehicles Equipment Furniture and fixtures Computers/software J. 40 years 20 to 50 years 20 to 30 years 20 years 20 years 15 years 3 to 15 years 5 to 10 years 5 to 10 years 3 years Deferred outflows and inflows of resources The statement of net position includes separate sections for deferred outflows of resources and deferred inflows of resources. Deferred outflows of resources represent a consumption of net position that applies to future periods that will be recognized as an expense in future periods. Deferred inflows of resources represent an acquisition of net position that applies to future periods and will be recognized as a revenue in future periods. K. Pensions For purposes of measuring the new pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the pension plans’ fiduciary net position and additions to/deductions from the plans’ fiduciary net position have been determined on the same basis as they are reported by the plans. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with benefit terms. Investments are reported at fair value. 54 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) L. Compensated absences Employees are entitled to accumulate vacation to a maximum allowable limit depending on the number of years of service. In the event of termination, an employee is reimbursed for the accumulated vacation leave. Different measurement focuses for governmental and proprietary funds were considered when determining the compensated absences liability. Because the measurement focus for proprietary funds is the determination of net income, current and long-term liabilities are recorded in the accounting records. The measurement focus for governmental funds is the flow of financial resources; expenditures for vacation time are accrued as current liabilities only if they have matured (i.e., unused reimbursable leave still outstanding following an employee’s resignation or retirement). City employees with less than ten years of service are granted non-vesting sick leave. Employees with ten or more years of service will be paid the unused accrued sick leave as follows: 10 – 15 years of service will receive 30% up to a maximum of 128 hours or 180 hours for firefighters working 24 hour shifts. 15 – 19 years of service will receive 40% up to a maximum of 288 hours or 404 hours for firefighters working 24 hour shifts. 20 or more years of service will receive 50% up to a maximum of 640 hours or 896 hours for firefighters working 24 hour shifts. Sick leave compensation is accounted for in the period in which the event takes place. M. Long-term Obligations A distinction is made between proprietary fund long-term liabilities and governmental long-term debt. Governmental funds’ long-term obligations are recognized as a liability in the governmental funds when due and expected to be financed from expendable available financial resources. Long-term obligations expected to be financed from proprietary fund operations are accounted for in the fund as a long term liability. 55 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 1 N. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Interfund Activity Interfund transactions are categorized as loans, reimbursements, interfund services provided and used or transfers. Loans between funds are reported in the balance sheet of the borrowing and lending funds as a liability and receivable, respectively. Reimbursements are expenditures or expenses of one fund but are attributable to another fund. An example of this type of transaction is when one fund purchases a supply in which another fund uses, thus reimbursing the original funds expenditure/ expense. An interfund service is revenue to the fund providing the service and expenditure to the fund receiving the service. Other interfund transactions are classified as transfers. Transfers usually reflect ongoing operating subsidies between funds. O. Fund Equity Reserves represent those portions of fund equity not appropriable for expenditures or legally segregated for a specific future use. P. Fund Balance Policies In the fund financial statements, fund balance is reported in classifications that comprise a hierarchy based 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 Non-spendable, Restricted, Committed, Assigned and Unassigned. Non-spendable and Restricted fund balances represent the restricted classifications and Committed, Assigned and Unassigned represent the unrestricted classifications. Non-spendable fund balance includes amounts that cannot be spent because it is not in a spendable form such as inventory or prepaid items. Restricted fund balance is externally (outside the City) enforceable limitations imposed by creditors, grantors, contributors and laws and regulations of other governments. Committed fund balance is self-imposed limitations imposed at the highest level of decision making authority, the City Council. Council approval through the adoption of an Ordinance is required to commit resources or to rescind the commitment. Assigned fund balance represents limitations imposed by the City Council. 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, restricted resources are considered spent before unrestricted resources. Within fund balance committed is spent first and then assigned resources are used. For fund balance details by classification, see the Fund Balance Details by Classification note disclosure. 56 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Q. Implementation of New GASB Pronouncements In June 2012, the GASB issued Statement No. 68, Accounting and Financial Reporting for Pensions, as amended in November 2013 by GASB No. 71, Pension Transition for Contributions Made Subsequent to the Measurement Date. GASB Statements Nos. 68 and 71 establish standards for measuring and recognizing net pension liabilities, deferred outflows of resources, deferred inflows of resources and expenses related to pension benefits provided through defined benefit pension plans. In addition, Statement No. 68 requires disclosure of information related to pension benefits. The requirements of these Statements are effective for financial statements for periods beginning after June 15, 2014. The City adopted GASBS Nos. 68 and 71 in fiscal year 2015. The adoption of GASBS Nos. 68 and 71 has impacted the presentation of the City’s statements. In January 2013, the GASB issued Statement No. 69, Government Combinations and Disposals of Government Operations. GASBS No. 69 establishes accounting and financial reporting standards related to government combinations and disposals of government operations. The requirements of this Statement are effective for financial statements for periods beginning after December 15, 2013. The City adopted GASBS No. 69 in fiscal year 2015. The adoption of GASBS No. 69 does not have an impact on the City’s financial statements. NOTE 2 CASH AND INVESTMENTS Custodial Credit Risk Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, an entity will not be able to recover its deposits or will not be able to recover collateral securities that are in the possession of an outside party. The carrying amount of the City’s cash in bank totaled $6,566,311 and the bank balance was $6,780,177. Federal Depository Insurance covered the City’s deposits at June 30, 2015, to the extent of $337,866. The City had cash on hand of $4,055. Deposits of $6,442,311 were collateralized with securities held by the pledging financial institution or by its trust department or agent but not in the City’s name. Casa Grande does not have a deposit policy for custodial credit risk. 57 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 2 CASH AND INVESTMENTS (Continued) Cash and cash equivalents include restricted and unrestricted amounts as follows: Cash and cash equivalents Investments Restricted cash and cash equivalents Governmental Activities $ 5,504,375 85,977,184 1,229,683 $ 92,711,242 $ Business Activities 1,002,614 10,870,320 - $ 11,872,934 $ Fiduciary Fund 63,376 2,374,540 - $ $ 2,437,916 $ Total 6,570,365 99,222,044 1,229,683 107,022,092 Investments The City’s policy is to invest unrestricted cash in the Local Government Investment Pool (LGIP), an investment pool managed by the State Treasurer’s Office that allows governments within the State to pool their funds for investment purposes. The LGIP is not registered with the Securities Exchange Commission under the 1940 Investment Advisors Act. The fair value of the City’s position is the same as the value of the pool shares. The State Board of Investment has oversight responsibilities of the investment pool pursuant to ARS 35-311. The pool’s investments include securities with the full faith and credit of the United State Government with a final maturity less than 24 months and variable-rate securities with final maturity less than 5 years. The dollar weighted average portfolio maturity is less than 180 days. Only securities backed by the full faith and credit of the U.S. Government may be purchased for this pool. The fair value balance of the pool at June 30, 2015 was $1.1 billion in assets. The City also holds $49,927,711 invested with PFM Asset Management, LLC. The accounts are invested in U.S. Treasury securities, U.S. Government bonds, certificates of deposit and corporate debt securities. 58 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 2 CASH AND INVESTMENTS (Continued) Interest Rate Risk Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. Casa Grande has a formal investment policy that limits investment maturities as a means of managing its exposure to fair value losses arising from increasing interest rates. The following table shows the City’s investment maturities: Investment maturities (in years) Governmental funds Investment Type LGIP Pool #7 Total $ 35,802,262 U.S. Treasury Notes 19,309,607 Federal Agency Securities 23,260,240 Money market Less than 1 $ 35,802,262 1-5 $ 4,471,104 - 6 - 10 - - 23,260,240 - 1,407,114 1,407,114 - 499,175 499,175 - Corporate Securities 6,928,469 1,985,867 87,206,867 $ 10,870,320 $ 44,165,522 - 14,838,503 Certificate of Deposit $ $ - 4,942,602 $ 43,041,345 $ - Proprietary funds Investment Type LGIP Pool #7 Total Less than 1 $ 10,870,320 1-5 $ 6 - 10 - $ - Fiduciary funds Investment Type LGIP Pool #7 Total $ Money market Total 1,948,066 Less than 1 $ 426,474 1,948,066 1-5 $ 426,474 6 - 10 - $ - $ 2,374,540 $ 2,374,540 $ $ 100,451,727 $ 57,410,382 $ 43,041,345 - $ - $ - 59 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 2 CASH AND INVESTMENTS (Continued) Credit Risk Credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. The following table shows the actual rating as of year-end by investment type. Governmental funds Investment Type LGIP Pool #7 Total $ 35,802,262 U.S. Treasury Notes 19,309,607 Federal Agency Securities 23,260,240 Money market Unrated $ A-AAA 35,802,262 $ B-BBB - $ - - 19,309,607 - - 23,260,240 - 1,407,114 1,407,114 - - Certificate of Deposit 499,175 499,175 - - Corporate Securities 6,928,469 $ 87,206,867 $ 10,870,320 $ 37,708,551 5,933,500 $ 48,503,347 994,969 $ 994,969 Proprietary funds Investment Type LGIP Pool #7 Total Unrated $ 10,870,320 A-AAA $ B-BBB - $ - Fiduciary funds Investment Type LGIP Pool #7 Total $ Money market Total 1,948,066 Unrated $ 426,474 1,948,066 A-AAA $ 426,474 B-BBB - $ - $ 2,374,540 $ 2,374,540 $ $ 100,451,727 $ 50,953,411 $ 48,503,347 - $ $ 994,969 60 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 2 CASH AND INVESTMENTS (Continued) Concentration of Credit Risk The investment policy of the City contains no limitations on the amount that can be invested in any one issuer. Investments in any one issuer are as follows: Investment Type LGIP Pool #7 Total $ Money Market Funds Concentration 48,620,648 48.40% 1,833,588 1.83% Federal Agency Securities 23,260,240 23.16% U.S. Treasury Notes 19,309,607 19.22% Certificat of Deposit Corporate Debt Total NOTE 3 $ 499,175 0.50% 6,928,469 6.90% 100,451,727 CASH WITH FISCAL AGENT/RESTRICTED INVESTMENTS In November 2006, December 2008 and August 2010 the Villago Community Facilities District issued long-term revenue obligations. Certain resources set aside for repayment are classified as restricted cash on the statement of net assets and on the balance sheet because their use is limited by applicable bond covenants. Description of Designated Balance at Fund Type Capital 6/30/2015 Capital - CFD Infrastructure $ 307,135 In April 2005, the Mission Royale Community Facilities District issued long-term revenue obligations. Certain resources set aside for repayment are classified as restricted cash on the statement of net assets and on the balance sheet because their use is limited by applicable bond covenants. Description of Designated Balance at Fund Type Capital 6/30/2015 Capital - CFD Sewer Line $ 693,897 61 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 4 RECEIVABLES The following table is a summary of the City’s governmental activities receivables. Receivables: Taxes Interest Accounts $ General Fund 3,093,988 139,252 3,233,240 Less: Allowance $ Highway User 644,607 324 644,931 (250) Total receivables $ 3,232,990 Capital Replacement/ Recreation/ Development $ 635,665 30,929 666,594 $ 644,931 Non-Major Governmental Funds $ 68,005 13,359 645,271 726,635 $ 666,594 Total Governmental Funds $ 4,442,265 13,359 815,776 5,271,400 $ 726,635 (250) $ 5,271,150 The following table is a summary of the City’s business-type activities receivables. Receivables: Accounts Water Wastewater Sanitation Golf Course Internal Service Fund Fund Fund Fund Fund $ 5,719 $ 4,627,463 $ 2,584,672 $ 3,557 $ 42,451 Less: Allowance - Net receivables $ 5,719 (2,868,285) $ 1,759,178 (858,175) $ 1,726,497 $ 3,557 $ 42,451 Revenues of wastewater and sanitation are reported net of uncollectible amounts. uncollectible amounts related to revenues of the current period are as follows: Total Uncollectibles related to wastewater Uncollectibles related to sanitation $ 1,818,174 985,163 Total uncollectibles for the current year $ 2,803,337 NOTE 5 DIRECT LOANS The City issues loans to provide housing for low-income families, which are funded by Community Development Block Grants from the U.S. Department of Housing and Urban Development through the Arizona Department of Commerce. These loans are paid back on a monthly basis and have varying terms and maturity dates. At June 30, 2015 these loans outstanding totaled $415,450. 62 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 6 PROPERTY TAXES Arizona Revised Statutes require that property taxes be levied on or before the third Monday in August. Taxes are levied and collected by the Pinal City Treasurer on real and personal property. Real property taxes, payable in two installments, are due November 1 and May 1. Personal property taxes are billed throughout the year. Interest and penalties are assessed if a taxpayer fails to pay the tax within a period of time specified by law. Taxes are considered a lien against real property at the date of levy. The primary tax levy is limited to a 2% increase over the previous year’s maximum allowable primary levy plus an increased dollar amount due to a net gain in property not taxed the previous year. The primary levy is further limited in that the primary tax from all jurisdictions may not exceed 1% of the homeowner’s market value of the home. Secondary taxes are levied to retire voter approved general obligation bonds. The City’s 2014-2015 maximum primary levy limit was $3,595,284. The primary tax levy was $3,251,900. The City’s secondary tax levy was $1,775,000. Using the modified accrual basis of accounting, property tax revenue is recognized when it becomes both measurable and available to finance expenditures as of year-end and expected to be collected within 60 days after year-end. Available means taxes due or past due at the end of the fiscal year. Deferred revenue includes the balance of the property tax levy that does not meet the accrual criteria. Property tax receivable and deferred revenue at June 30, 2015, are $281,140 and $207,444 respectively. 63 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 7 CAPITAL ASSETS A summary of capital assets activity for the fiscal year ended June 30, 2015 follows: Governmental Activities Capital assets, not being depreciated: Land Construction in progress Total capital assets not being depreciated Capital assets, being depreciated: Buildings Improvements Heavy machinery & equipment Total capital assets being depreciated Less accumulated depreciation for: Buildings Improvements Heavy machinery & equipment Total accumulated depreciation Total capital assets, being depreciated, net Governmental activities capital assets, net Business-Type Activities Capital assets, not being depreciated: Land Construction in progress Total capital assets not being depreciated Capital assets, being depreciated: Buildings and improvements Machinery and equipment Total capital assets being depreciated Less accumulated depreciation for: Buildings and improvements Machinery and equipment Total accumulated depreciation Total capital assets, being depreciated, net Business-Type activities capital assets, net Beginning Balance $ 19,531,684 158,120 Increases $ $ - $ 561,501 70,225,198 228,735,866 24,522,178 323,483,242 289,701 3,013,739 2,173,370 5,476,810 (332,858) (332,858) 70,514,899 231,749,605 26,362,690 328,627,194 (16,640,715) (108,038,633) (17,174,940) (2,778,989) (10,539,035) (1,690,965) 310,966 (19,419,704) (118,577,668) (18,554,939) (141,854,288) (15,008,989) 310,966 (156,552,311) 181,628,954 (9,532,179) (21,892) 172,074,883 $ Beginning Balance 2,983,724 - (8,970,678) - 19,531,684 719,621 19,689,804 $ 201,318,758 $ 561,501 Ending Balance Decreases $ Increases $ 148,451 (21,892) 20,251,305 $ Ending Balance Decreases $ - 192,326,188 $ 2,983,724 148,451 123,755,579 16,773,934 140,529,513 536,973 1,115,732 1,652,705 (242,614) (242,614) 124,292,552 17,647,052 141,939,604 (26,562,676) (6,752,713) (33,315,389) (3,540,519) (1,090,648) (4,631,167) 242,614 242,614 (30,103,195) (7,600,747) (37,703,942) 107,214,124 (2,978,462) $ 110,197,848 $ (2,830,011) - 2,983,724 148,451 3,132,175 $ - 104,235,662 $ 107,367,837 64 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 7 CAPITAL ASSETS (Continued) Depreciation expense was charged to the functions/programs of the government as follows: Governmental activities: General government $ 438,327 Public safety 2,448,657 Streets/Transportation 9,543,051 Public Works 863,827 Culture and recreation 1,457,926 Economic Development 242,399 Internal Service 14,802 Total depreciation expense $ 15,008,989 Business-type activities: Water $ Wastewater 64,433 3,460,108 Sanitation 925,566 Golf Course 181,060 Total depreciation expense NOTE 8 $ 4,631,167 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS The City contributes to the plans described below. The plans are component units of the State of Arizona. At June 30, 2015, the City reported the following aggregate amounts related to pensions for all plans to which it contributes: Statement of Net Position and Statement of Activities Net pension liabilities Governmental Activities Business-type Activites Total 53,258,803 4,592,644 57,851,447 Deferred outflows of resources 9,684,637 496,438 10,181,075 Deferred inflows of resources 4,210,648 810,820 5,021,468 Pension expense 6,144,477 298,870 6,443,347 The City reported $4,009,764 of pension contributions in expenditures in the fund statements related to all pension plans to which it contributes. 65 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 8 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS (Continued) A. Arizona State Retirement System Plan Description - City employees not covered by the other pension plans described below participate in the Arizona State Retirement System (ASRS). The ASRS administers a costsharing multiple-employer defined benefit pension plan, a cost-sharing multiple-employer defined benefit health insurance premium benefit (OPEB) plan, and a cost-sharing multipleemployer defined benefit long-term disability (OPEB) plan. The Arizona State Retirement System Board governs the ASRS according to the provisions of A.R.S. Title 38, Chapter 5, Articles 2 and 2.1. The ASRS issues a publicly available financial report that includes its financial statements and required supplementary information. The report is available on its Web site at www.azasrs.gov. Benefits Provided - The ASRS provides retirement, health insurance premium supplement, long-term disability, and survivor benefits. State statute establishes benefits terms. Retirement benefits are calculated on the basis of age, average monthly compensation, and service credit as follows: ASRS Retirement Initial membership date: Years of service and age required to receive benefit Before July 1, 2011 On or after July 1, 2011 Sum of years and 30 years age 55 age equals 80 10 years age 62 25 years age 60 5 years age 50+ 10 years age 62 and years age 65 5 years age 50* any years age 65 Final average salary is based on Benefit percent Highest 36 months Highest 60 months of last 120 months of last 120 months 2.1% to 2.3% 2.1% to 2.3% per year of service *with actuarially reduced benefits Retirement benefits for members who joined the ASRS prior to September 13, 2013, are subject to automatic cost-of-living adjustments based on excess investment earning. Members with a membership date on or after September 13, 2013, are not eligible for cost-of-living adjustments. Survivor benefits are payable upon a member’s death. For retired members, the survivor benefit is determined by the retirement benefit option chosen. For all other members, the beneficiary is entitled to the member’s account balance that includes the member’s contributions and employer’s contributions, plus interest earned. 66 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 8 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS (Continued) Contributions - In accordance with state statutes, annual actuarial valuations determine active member and employer contribution requirements. The combined active member and employer contribution rates are expected to finance the costs of benefits employees earn during the year, with an additional amount to finance any unfunded accrued liability. For the year ended June 30, 2015 active ASRS members were required by statute to contribute at the actuarially determined rate of 11.6 percent (11.48 percent for retirement and 0.12 percent for long-term disability) of the members’ annual covered payroll, and the City was required by statute to contribute at the actuarially determined rate of 11.6 percent (10.89 percent for retirement, 0.59 percent for health insurance premium benefit, and 0.12 percent for long-term disability) of the active members’ annual covered payroll. In addition, the City was required by statute to contribute at the actuarially determined rate of 9.57 percent (9.51 percent for retirement and 0.06 percent for long-term disability) of annual covered payroll of retired members who worked for the City in positions that would typically be filled by an employee who contributes to the ASRS. The City’s contributions to the pension plan for the year ended June 30, 2015 were $1,329,066. The City’s contributions for the current and 2 preceding years for OPEB, all of which were equal to the required contributions, were as follows: ASRS Health Benefit Long-Term Supplement Disability Year ended June 30 Fund Fund 2015 $ 68,745 $ 13,749 2014 $ 77,803 $ 31,121 2013 $ 75,053 $ 30,021 During fiscal year 2015, the City paid for ASRS pension and OPEB contributions as follows: 64.5 percent from the General Fund, 7.9 percent from the HURF Fund, 0.2 percent from the Water Fund, 5.1 percent from the Wastewater Fund, 14.2 percent from the Sanitation Fund, 0.5 percent from the Golf Fund, and 7.6 percent from other funds. Pension Liability - At June 30, 2015, the City reported a liability of $21,766,069 for its proportionate share of the ASRS’ net pension liability. The net pension liability was measured as of June 30, 2014. The total pension liability used to calculate the net pension liability was determined using update procedures to roll forward the total pension liability from an actuarial valuation as of June 30, 2013, to the measurement date of June 30, 2014. The City’s proportion measured as of June 30, 2014 was 0.147102 percent, which was a decrease of 0.000302 percent from its proportion measured as of June 30, 2013. The City’s reported liability at June 30, 2015, decreased by $2,738,936 from the City’s prior year liability of $24,505,005 because of changes in the ASRS’ net pension liability and the City’s proportionate share of that liability. The ASRS’ publicly available financial report provides details on the change in the net pension liability. 67 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 8 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS (Continued) Pension Expense and Deferred Outflows/Inflows of Resources - For the year ended June 30, 2015, the City recognized pension expense for ASRS of $1,416,438. At June 30, 2015, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: ASRS Deferred Deferred Outflows of Inflows of Resources Differences between expected $ 1,106,215 Resources $ - and actual experience Net difference between projected and actual earnings on pension plan investments 3,806,213 Changes in proportion and differences between City contributions and proportionate share of contributions 36,535 City contributions subsequent to the measurement date Total 1,246,572 $ 2,352,787 $ 3,842,748 The $1,246,572 reported as deferred outflows of resources related to ASRS pensions resulting from City contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended June 30, 2016. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to ASRS pensions will be recognized in pension expense as follows: Year ending June 30 2016 $ (486,475) 2017 (486,475) 2018 (813,030) 2019 (950,533) 68 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 8 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS (Continued) Actuarial Assumptions - The significant actuarial assumptions used to measure the total pension liability are as follows: ASRS Actuarial valuation date June 30, 2013 Actuarial roll forward date June 20, 2014 Actuarial cost method Entry age normal Amortization method: Plan amendments Immediate Investment gain/oss 5 years Assumption gain/loss Average future service lives Experience gain/loss Average future service lives Asset valuation Fair Value Discount rate 8% Projected salary increases 3 - 6.75% Inflation 3% Permanent benefit increase Included Mortality rates 1994 GAM Scale BB Actuarial assumptions used in the June 30, 2013, valuation were based on the results of an actuarial experience study for the 5-year period ended June 30, 2012. The long-term expected rate of return on ASRS pension plan investments was determined to be 8.79 percent using a building-block method in which best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized in the following table: ASRS Long-Term Target Asset Class Expected Real Allocation Rate of Return Equity 63% 7.03% Fixed Income 25% 3.20% Real estate 8% 4.50% Commodities 4% 4.75% Total 100% 69 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 8 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS (Continued) Discount Rate - The discount rate used to measure the ASRS total pension liability was 8 percent, which is less than the long-term expected rate of return of 8.79 percent. The projection of cash flows used to determine the discount rate assumed that contributions from participating employers will be made based on the actuarially determined rates based on the ASRS Board’s funding policy, which establishes the contractually required rate under Arizona statute. Based on those assumptions, the pension plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. Sensitivity of the City’s Proportionate Share of the ASRS Net Pension Liability to Changes in the Discount Rate - The following table presents the City’s proportionate share of the net pension liability calculated using the discount rate of 8 percent, as well as what the City’s proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1 percentage point lower (7 percent) or 1 percentage point higher (9 percent) than the current rate: ASRS Current 1% Decrease Discount Rate (7%) City's proportionate share $ 27,511,194 1% increase (8%) $ 21,766,069 (9%) $ 18,649,049 of the net pension liability Pension Plan Fiduciary Net Position - Detailed information about the pension plan’s fiduciary net position is available in the separately issued ASRS financial report. B. Public Safety Personnel Retirement System Plan Descriptions – City police department employees and City fire fighter employees who are regularly assigned hazardous duty participate in the Public Safety Personnel Retirement System (PSPRS). The PSPRS administers an agent multiple-employer defined benefit pension plan and an agent multiple-employer defined benefit health insurance premium benefit (OPEB) plan (agent plans). A seven-member board known as the Board of Trustees and the participating local boards govern the PSPRS according to the provisions of A.R.S. Title 38, Chapter 5, Article 4. The PSPRS issue publicly available financial reports that include their financial statements and required supplementary information. The reports are available on the PSPRS Web site at www.psprs.com. 70 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 8 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS (Continued) Benefits Provided - The PSPRS provide retirement, health insurance premium supplement, disability, and survivor benefits. State statute establishes benefits terms. Retirement, disability, and survivor benefits are calculated on the basis of age, average monthly compensation, and service credit as follows: PSPRS Initial membership date: Retirement and Before January 1, 2012 On or after January 1, 2012 20 years any age 25 years and age 52.5 Disability Years of service and age required 15 years age 62 to receive benefit Final average salary is based on Highest 36 months Highest 60 months of last 20 years of last 20 years Benefit percent Normal 50% less 2.0% for each year 2.5% per year of credited service, Retirement of credited service less than 20 not to exceed 80% years OR plus 2.0% to 2.5% for each year of credited service over 20 years, not to exceed 80% Accidental Disability 50% or normal retirement, whichever is greater Retirement Catastrophic Disability Retirement 90% for the first 60 months then reduced to either 62.5% or normal retirement, whichever is greater Ordinary Disability Normal retirement calculated with actual years of credited service Retirement or 20 years of credited service, whichever is greater, mulitiplied by years of credited service (not to exceed 20 years) divided by 20 Survivor Benefits Retired Members 80% of retired member's pension benefit Active Members 80% of accidental disability retirement benefit or 100% of average monthly compensation if death was the result of injuries received on the job 71 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 8 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS (Continued) Retirement and survivor benefits are subject to automatic cost-of-living adjustments based on excess investment earning. PSPRS also provides temporary disability benefits of 50 percent of the member’s compensation for up to 12 months. Employees Covered by Benefit Terms - At June 30, 2015, the following employees were covered by the agent pension plans’ benefit terms: PSPRS PSPRS Police Fire 43 18 Inactive employees or beneficiaries currently receiving benefits Inactive employees entitled to 6 2 Active employees by not yet receiving benefits 73 57 Total 122 77 Contributions and Annual OPEB Cost - State statutes establish the pension contribution requirements for active PSPRS employees. In accordance with state statutes, annual actuarial valuations determine employer contribution requirements for PSPRS pension and health insurance premium benefits. The combined active member and employer contribution rates are expected to finance the costs of benefits employees earn during the year, with an additional amount to finance any unfunded accrued liability. Contributions rates for the year ended June 30, 2015, are indicated below. Rates are a percentage of active members’ annual covered payroll. PSPRS PSPRS Police Fire 7.65% 7.65% Pension 31.84% 22.21% Health insurance permium benefit 1.16% 0.97% Active members - Pension City In addition, the City was required by statute to contribute at the actuarially determined rate of 19.65 percent for the PSPRS of annual covered payroll of retired members who worked for the City in positions that would typically be filled by an employee who contributes to the PSPRS. 72 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 8 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS (Continued) For the agent plans, the City’s contributions to the pension plan and annual OPEB cost and contributions for the health insurance premium benefit for the year ended June 30, 2015, were: Pension Contributions made $ PSPRS PSPRS Police Fire 1,825,522 $ 924,690 Health Insurance Permium Benefit Annual OPEB cost Contributions made 66,508 40,385 During fiscal year 2015, the City paid for PSPRS and OPEB contributions as follows: 97.9 percent from the General Fund and 2.1 percent from other funds. Pension Liability (Asset) - At June 30, 2015, the City reported the following net pension liabilities (assets): Net Pension Liability PSPRS Police $ PSPRS Fire 25,043,021 11,040,178 The net pension liabilities were measured as of June 30, 2014, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. Pension Actuarial Assumptions - The significant actuarial assumptions used to measure the total pension liability are as follows: PSPRS Police and Fire Actuarial valuation date June 30, 2014 Actuarial cost method Entry age normal Amortization method Level Percentage of Payroll, Closed Remaining amortization period 24 years for unfunded actuarial accrued liability, 20 years Asset valuation method 7-year smoothed market value (80%/120% market) for excess Actuarial assumptions: Investment rate of return 8%, net of investment and adminstrative expenses Projected salary increases includes inflation at 3.0% - 4.0% 73 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 8 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS (Continued) Actuarial assumptions used in the June 30, 2014, valuation were based on the results of an actuarial experience study for June 30, 2012. The long-term expected rate of return on both the PSPRS Police and PSPRS Fire pension plan investments was determined to be 7.85 percent using a building-block method in which bestestimate ranges of expected future real rates of return (expected returns, net of pension plan investment expenses and inflation) are developed for each major asset class. The target allocation and best estimates of geometric real rates of return for each major asset class are summarized in the following table: PSPRS Police and PSPRS Fire Asset Class Long-Term Target Expected Real Allocation Rate of Return U.S. equity 16.00% 7.60% Non-U.S. equity 14.00% 8.63% Private equity 11.00% 9.50% Fixed income 7.00% 4.75% 13.00% 8.00% Credit opportunities Absolute Return GTAA 4.00% 6.75% 10.00% 5.73% Real Assets 8.00% 5.96% Real Estate 11.00% 6.50% Risk Parity 4.00% 6.04% Short Term Inv 2.00% 3.25% Total 100% Pension Discount Rates - A 7.85 percent discount rate was used to measure the total pension liability for both the PSPRS Police and PSPRS Fire pension plans. The projection of cash flows used to determine the discount rates for both PSPRS Police and PSPRS Fire assumed that plan member contributions will be made at the current contribution rate and that employer contributions will be made at rates equal to the difference between the actuarially determined contribution rate and the member rate. Based on those assumptions, the pension plans’ fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. 74 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 8 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS (Continued) Changes in the Net Pension Liability PSPRS Police Increase (Decrease) Total Plan Net Pension Fiduciary Pension Liability Net Liability (Asset) Position (Asset) (b) (a) - (b) (a) Balances at June 30, 2014 35,135,780 15,195,836 19,939,944 Changes for the year: Service Cost 1,015,910 1,015,910 Interest on the total pension liability 2,707,371 2,707,371 863,565 863,565 Changes of benefit terms Differences between expected and actual experience in the measurement of the pension liability Changes of assumptions or other inputs (573,850) (573,850) 4,417,506 4,417,506 Contributions - employer 1,604,579 Contributions - employee 539,514 (539,514) 1,965,995 (1,965,995) Net investment income (1,604,579) Benefit payments, including refunds of employee contributions (2,309,869) (2,309,869) - 6,120,633 1,017,556 5,103,077 41,256,413 16,213,392 25,043,021 Administrative expense Other changes Net changes Balances at June 30, 2015 (782,663) 782,663 75 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 8 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS (Continued) PSPRS Fire Balances at June 30, 2014 Increase (Decrease) Total Plan Net Pension Fiduciary Pension Liability Net Liability (Asset) Position (Asset) (a) (b) (a) - (b) 20,268,828 11,374,517 8,894,311 Changes for the year: Service Cost Interest on the total pension liability Changes of benefit terms 817,489 817,489 1,586,947 1,586,947 346,208 346,208 288,360 288,360 Differences between expected and actual experience in the measurement of the pension liability Changes of assumptions or other inputs 1,859,876 Contributions - employer 1,859,876 991,261 Contributions - employee Net investment income (991,261) 555,093 (555,093) 1,538,450 (1,538,450) Benefit payments, including refunds of employee contributions (923,381) (923,381) - Administrative expense Other changes Net changes Balances at June 30, 2015 (331,791) 331,791 3,975,499 1,829,632 2,145,867 24,244,327 13,204,149 11,040,178 76 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 8 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS (Continued) Sensitivity of the City’s Net Pension Liability (Asset) to Changes in the Discount Rate The following table presents the City’s net pension liabilities (assets) calculated using the discount rates noted above, as well as what the City’s net pension liability (asset) would be if it were calculated using a discount rate that is 1 percentage point lower or 1 percentage point higher than the current rate: PSPRS Police 1% Current 1% Decrease Discount Rate Increase 8.85% 6.85% 7.85% Total pension liability 46,381,865 41,256,413 36,998,647 Plan fiduciary net position 16,213,392 16,213,392 16,213,392 30,168,473 25,043,021 20,785,255 Net pension liability PSPRS Fire 1% Current 1% Decrease Discount Rate Increase 6.85% 7.85% 8.85% Total pension liability 27,411,892 24,244,327 21,606,400 Plan fiduciary net position 13,204,149 13,204,149 13,204,149 14,207,743 11,040,178 8,402,251 Net pension liability Pension Plan Fiduciary Net Position - Detailed information about the pension plans’ fiduciary net position is available in the separately issued PSPRS financial reports. Pension Expense - For the year ended June 30, 2015, the City recognized the following pension expense: Pension Expense PSPRS Police 3,572,496 PSPRS Fire 1,454,413 77 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 8 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS (Continued) Pension Deferred Outflows/Inflows of Resources - At June 30, 2015, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: PSPRS Police Deferred Deferred Outflows of Inflows of Resources Resources Differences between expected and actual experience $ - $ 661,046 Changes of assumptions or other inputs 3,643,523 - Net difference between projected and actual earnings on pension - plan investments - 473,307 Changes in proportion and differences between City - - contributions and proportionate - - share of contributions - - City contributions subsequent to the measurement date Total 2,750,212 $ PSPRS Fire 6,393,735 $ Deferred 1,134,353 Deferred Outflows of Inflows of Resources Resources Differences between expected and actual experience $ 254,337 $ - Changes of assumptions or other inputs 1,640,432 - Net difference between projected and actual earnings on pension - plan investments - 517,290 Changes in proportion and differences between City - - contributions and proportionate - - share of contributions - - City contributions subsequent to the measurement date Total 924,690 $ 2,819,459 $ 517,290 78 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 8 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS (Continued) The amounts reported as deferred outflows of resources related to pensions resulting from City contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability (or an increase in the net pension asset) in the year ended June 30, 2016. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions will be recognized in pension expense as follows: Year ending June 30, 2016 $ PSPRS PSPRS Police Fire 508,178 $ 124,145 2017 508,178 124,145 2018 508,178 124,145 2019 508,178 124,145 2020 476,458 253,467 Thereafter - 627,432 Agent Plan OPEB Actuarial Assumptions – The health insurance premium benefit contribution requirements for the year ended June 30, 2015, were established by the June 30, 2013, actuarial valuations, and those actuarial valuations were based on the following actuarial methods and assumptions. Actuarial valuations involve estimates of the reported amounts’ value and assumptions about the probability of events in the future. Amounts determined regarding the funded status of the plans and the annual required contributions are subject to continual revision as actual results are compared to past expectations and new estimates are made. The required schedule of funding progress for the health insurance premium benefit presented as required supplementary information provides multiyear trend information that shows whether the actuarial value of the plans’ assets are increasing or decreasing over time relative to the actuarial accrued liability for benefits. 79 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 8 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS (Continued) Projections of benefits are based on (1) the plans as understood by the City and plans’ members and include the types of benefits in force at the valuation date, and (2) the pattern of sharing benefit costs between the City and plans’ members to that point. Actuarial calculations reflect a long-term perspective and employ methods and assumptions that are designed to reduce short-term volatility in actuarial accrued liabilities and the actuarial value of assets. The significant actuarial methods and assumptions used are the same for all PSPRS plans and related benefits (unless noted), and the actuarial methods and assumptions used to establish the fiscal year 2015 contribution requirements, are as follows: PSPRS - OPEB Contribution Requirements Actuarial valuation date June 30, 2013 Actuarial cost method Entry age normal Amortization method Level percent closed for unfunded actuarial accrued liability, open for excess Remaining amortization period 23 years for unfunded actuarial accrued liability, 20 years for excess Asset valuation method 7-year smoothed market value (80%/120% market) Actuarial assumptions: Investment rate of return 7.85% Projected salary increases 4.5% - 8.5% for PSPRS includes inflation at 4.5% for PSPRS The funded status of the all the PSPRS and CORP health insurance premium benefit plans in the June 30, 2014, actuarial valuation was determined using the following actuarial methods and assumptions, applied to all periods included in the measurement: Agent Plan OPEB Trend Information – Annual OPEB cost information for the health insurance premium benefit for the current and preceding 2 years follows for each of the agent plans: Percentage of Year Ended June 30 Annual OPEB Annual Cost Net OPEB Cost Contributed Obligation PSPRS Police 2015 66,508 100% 2014 $ 56,434 100% $ - 2013 108,088 100% - PSPRS Fire 2015 40,385 100% 2014 $ 34,953 100% $ - 2013 35,232 100% - 80 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 8 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS (Continued) Agent Plan OPEB Funded Status - The following table presents the funded status of the health insurance premium benefit plans as of the most recent valuation date, June 30, 2014. PSPRS PSPRS Police Actuarial value of assets (a) $ Actuarial accrued liability (b) 754,568 Fire $ 371,272 675,772 525,683 (78,796) 154,411 Unfunded actuarial accrued liability (funded excess) (b) - (a) 111.66% Funded ratio (a)/(b) Annual covered payroll (c) $ 5,253,943 70.63% $ 4,550,140 Unfunded actuarial accrued liability (funding excess) as a percentage of covered payroll (b) - (a) / (c) NOTE 9 0.00% 3.39% RISK MANAGEMENT The City operates with traditional commercial insurance programs against major losses in property, plant, equipment and liability. Administrative responsibility for the safety program, education and loss prevention resides with the Human Resources Department. Insurance is procured on a competitive quotation basis, using the services of an independent broker as a consultant. The City processes all claims and evaluates their validity to determine if insurance reporting and investigation are warranted or if the claim can be resolved administratively. Claims settled administratively are paid from the funds where the claims occurred. During fiscal year 2015 there was no reduction in insurance coverage from prior years and settlements have not exceeded insurance coverage during any of the last three fiscal years. 81 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 10 CAPITAL LEASES Leases at June 30, 2015, included the following: Governmental activities: Lease with option to purchase Public Works Facility. Quarterly installments of $74,375 including interest of 4.887%, due through May 9, 2020. $1,312,875 Lease to finance Energy Improvements. The lease qualifies as an Energy Conservation Bond where tax credits are available annually to reduce interest. Payments are due semi-annually at an interest rate of 4.25%, due through July 1, 2027. 2,477,000 Lease to finance Solar Panels. Payments are due semi-annually at an interest rate of 3.59%, due through April 2031. 3,196,873 Lease to finance Solar Panels. Payments are due semi-annually at an interest rate of 3.75%, due through February 2033. 1,095,019 Total Governmental Activities Capital Lease Obligation $8,081,767 The future minimum lease payments by year are: Fiscal Year Ending Government June 30, Activities 2016 $861,707 2017 871,745 2018 886,470 2019 891,613 2020 899,475 2021-2025 3,118,368 2026-2030 2,402,774 2031-2033 552,659 Total minimum lease payments 10,484,811 Less: amount representing interest (2,403,044) Present value of future minimum lease payments 8,081,767 Less: current portion (543,783) Noncurrent portion $ 7,537,984 82 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 10 CAPITAL LEASES (Continued) Leased Capital Assets The following is an analysis of the leased assets included in capital assets: Cost Accumulated Depreciation Net Balance Building and Improvements: Governmental Activities Assets $ 12,278,922 $ (2,267,534) $ 10,011,388 Total Building and Improvement $ 12,278,922 $ (2,267,534) $ 10,011,388 NOTE 11 BOND DEBT General Obligation Bonds The City issues general obligation bonds to provide funds for the acquisition and construction of major capital facilities. General obligation bonds have been issued for both governmental and business-type activities. General obligation bonds are direct obligations and pledge the full faith and credit of the City. Community Facilities Districts (CFDs), special purpose districts created specifically to acquire or construct public infrastructure within specified areas of the City, are authorized under state law to issue General Obligation (GO) bonds to be repaid by property taxes levied on property within the district. CFDs are created by petition to the City Council by property owners within the area to be covered by the district and debt may be issued only after approval of the voters within the district. In April 2005 the Mission Royale Community Facilities District issued $1,335,000 of General Obligation bonds to finance the construction of a sewer line. These bonds will be repaid by the property owners within Mission Royale CFD. The bonds are obligations of the district only. The City has no obligation for the debt other than administration of the collection of property taxes and payment of the debt service on behalf of Mission Royale. Principal payments on the bond began in July, 2009. Villago Community Facilities District issued General Obligation bonds to finance construction of $455,000 in November 2006, $750,000 in December, 2008 and $2,200,000 in August, 2010. These bonds will be repaid by the property owners within Villago CFD. The bonds are obligations of the district only. The City has no obligation for the debt other than administration of the collection of property taxes and payment of the debt service on behalf of Villago. Principal payments on the bonds began in July, 2007 and 2009. 83 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 11 BOND DEBT (Continued) In June 2008 the City issued $11,000,000 of General Obligation bond debt to finance golf course improvements of $2,000,000, recreation center improvements of $1,500,000, construction of a new public safety building of $2,000,000, new fire station of $2,500,000 and new library of $3,000,000. The 20-year bond has interest rates ranging from 3.50% to 4.25%. Principal payments ranging from $2,170,000 to $675,000 are paid annually with interest paid semiannually on July 1 and January 1. In July 2009 the City issued $19,000,000 of General Obligation bond debt to design and construct a new public safety facility. The 25-year bond has interest rates ranging from 4% to 5%. Principal payments ranging from $370,000 to $1,700,000 are paid annually on July 1, with payments beginning July 2010 and with interest paid semiannually on July and January 1. The following table is a summary of the City’s future general obligation bond debt service requirements: Fiscal year ending June 30, NOTE 12 Governmental Activities Principal Interest 2016 2017 2018 2019 2020 2021-2025 2026-2030 2031-2035 $ 820,000 845,000 960,000 1,015,000 1,110,000 6,705,002 7,764,998 7,440,000 $ 1,269,734 1,239,534 1,200,110 1,154,669 1,110,923 4,784,764 3,215,075 1,401,159 Total $ 26,660,000 $ 15,375,968 EXCISE TAX REVENUE OBLIGATIONS On December 1, 2003, the City issued $18,120,000 of Excise Tax Revenue Obligations Series 2003. The 20-year revenue obligations have interest rates that range from 2.00 to 5.00 percent. Principal payments ranging from $780,000 to $1,600,000 are paid annually on April 1. $9,300,000 was used to finance the construction of a wastewater treatment plant. $8,820,000 was used to advance refund $4,560,000 of Series 1994 and $3,830,000 of Series 1995 Excise Tax Revenue Obligations with interest rates ranging from 4.35 to 6.00 and 5.00 to 6.20 percent, respectively. These bonds were advance refunded for maturities in 2017 to 2022. The present value savings was $868,776. 84 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 12 EXCISE TAX REVENUE OBLIGATIONS (Continued) In August, 2009 the City issued $18,800,000 in excise tax revenue obligations consisting of: $7,175,000 in tax exempt obligations to construct a new courthouse and make road improvements. The 20-year obligation has interest rates ranging from 4.4% to 4.9% with principal payments beginning April 1, 2024. $11,625,000 in taxable obligations constructed a multi-use sports complex. The 15-year obligation has interest rates ranging from 2.3% to 6.4% with principal payments beginning April 1, 2010. In 2012 the City issued Refunding obligations maturing in 2022. These bonds were issued to advance refund the 2003 issue. The interest rates range from 2% to 5%. The net refunding savings was $868,776. Debt service payments were reduced by $949,608. The 2003, 2009, and 2012 revenue obligations are secured by a pledge of and first lien on all excise, transaction, franchise, privilege and business taxes, state shared sales and income taxes, fees for licenses and permits and state revenue sharing which the City presently or in the future validly imposes or receives from other entities. The following table summarizes the City’s future revenue obligation debt service requirements as of June 30,2015: Governmental Activities Fiscal year ending June 30, 2016 Principal $ 802,755 Business-Type Activities Interest $ 877,577 Principal $ Interest 707,322 $ 402,163 2017 878,087 834,740 1,106,913 373,870 2018 950,356 789,098 1,414,644 351,732 2019 1,001,868 735,393 1,488,132 281,000 2020 1,062,973 676,600 1,557,027 206,593 2021-2025 5,833,213 2,364,232 3,026,787 207,558 2026-2030 5,625,000 707,288 Total $ 16,154,252 $ 6,984,927 $ 9,300,825 $ 1,822,916 85 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 13 WIFA FINANCING In January, 2009 the City of Casa Grande received financing from the Water Infrastructure Finance Authority (WIFA) of Arizona to finance a wastewater treatment plant expansion project which was completed in 2011. The original loan was authorized for a total of $62,555,540; however the balance disbursed to the City of Casa Grande at June 30, 2015 is $59,224,517. The following schedule shows estimated payments based on the amount due of $44,081,487. Fiscal Year Ending June 30, 2016 2017 2018 2019 2020 2021-2025 2026-2030 Principal Interest $ 2,534,014 2,636,109 2,742,318 2,852,806 2,967,746 16,731,594 13,616,900 $ 1,827,200 1,725,104 1,618,895 1,508,407 1,393,468 5,074,473 1,465,167 $ 44,081,487 $ 14,612,714 The twenty year loan has an interest rate of 4.029%. Principal payments ranging from $2,390,542 to $4,497,459 are paid annually with interest paid semi-annually on October 1 and April 1. 86 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 14 CHANGES IN LONG-TERM OBLIGATIONS Beginning Balance Governmental activities: Compensated absences G.O Bonds (2) Excise tax revenue obligations Capital leases Bonds premiums Bonds discounts Governmental activities long-term liabilities Additions & transfers Ending Balance Due Within One Year $ 2,629,619 26,254,555 16,919,970 7,470,835 189,130 (287,367) $ 1,443,611 1,115,445 1,095,019 21,272 - $ (1,314,810) (710,000) (765,718) (484,087) (19,681) 22,394 $ 2,758,420 26,660,000 16,154,252 8,081,767 190,721 (264,973) $ 1,241,289 820,000 802,755 543,783 - $ 53,176,742 $ 3,675,347 $ (3,271,902) $ 53,580,187 $ 3,407,827 Beginning Balance Business-type activities Compensated absences Bonds payable (2) Excise tax revenue obligations Notes payable (1) Loan payable Bond premiums Postclosure liability Business-type activities long-term liabilities Reductions & transfers Additions & transfers Reductions & transfers Ending Balance Due Within One Year $ 303,387 1,115,446 9,985,030 81,831 46,319,556 1,220,429 2,640,156 $ 112,541 197,803 97,008 $ (151,694) (1,115,446) (684,205) (12,513) (2,435,872) (168,665) - $ 264,234 9,300,825 69,318 44,081,487 1,051,764 2,737,164 $ 118,905 707,322 12,513 2,534,444 - $ 61,665,835 $ 407,352 $ (4,568,395) $ 57,504,792 $ 3,373,184 (1) In January 2002 the Water Fund received financing from the Water Infrastructure Finance Authority of Arizona. The note is paid semi-annually until July 2019 with an interest rate of 3.437%. (2) In July 2014 the Golf Course Fund transferred its bonds payable to Governmental Activities. Compensated absences are paid from various funds in the same proportion that those funds pay payroll costs. During the year ended June 30, 2014, the City primarily paid for compensated absences from the General Fund. 87 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 15 LONG-TERM DEBT The following summarizes the annual debt service requirements to maturity for all bonds, loans, and notes are as follows: Governmental Activities Fiscal year ending June 30, 2016 $ 2,166,538 Business-Type Activities Interest $ 2,465,235 Principal $ Interest 3,254,279 $ 2,231,523 2017 2,300,845 2,368,261 3,756,410 2,100,682 2018 2,528,371 2,257,663 4,170,810 1,971,867 2019 2,667,095 2,131,448 4,355,262 1,790,163 2020 2,859,593 2,000,378 4,539,588 1,600,314 2021-2025 14,891,239 7,914,340 19,758,381 5,282,031 2026-2030 15,513,994 4,201,141 13,616,900 1,465,167 2031-2035 7,968,344 1,425,474 Total NOTE 16 Principal $ 50,896,019 $ 24,763,939 $ 53,451,630 $ 16,441,747 LANDFILL CLOSURE AND POST CLOSURE CARE COSTS The U.S. Environmental Protection Agency and the Arizona Department of Environmental Quality require municipal solid waste landfill (MSWLF) owners and operators to provide for landfill closure and post closure care costs. The City of Casa Grande owns and operates one landfill. Closure and post closure care costs include cost of equipment expected to be installed and facilities expected to be constructed, cost of final cover and cost of monitoring and maintaining the expected useable MSWLF area. These costs are expected to be paid near or after the date that the MSWLF stops accepting solid waste and during the postclosure period. The Environmental Protection Agency has established the postclosure period to be 30 years. Closure and postclosure care costs are recognized in the current period based on landfill capacity used to date. On June 30, 2015 the City has reported a $2,737,164 landfill closure and postclosure care liability that represents the total current cost based on 56.4 percent of estimated capacity of the landfill. The remaining cost of $2,109,811 will be recognized in the future periods as the remaining capacity is filled. The City expects the remaining capacity to extend for 15 years, which will be through the year 2030. Total closure and postclosure costs are based on current costs, and are reevaluated annually for changes in inflation or deflation, technology, and applicable laws or regulations. The 2015 valuation of the total closure and postclosure costs were estimated to be $4,846,975. 88 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 17 CONSTRUCTION COMMITMENTS The City has active construction projects as of June 30, 2015. At year end the City’s significant commitments included sewer improvements and road construction. At year end the City’s commitments with contractors are as follows: Remaining Commitment Project Carr McNatt Park Improvements $ 312,542 Heliport 195,543 Increase Kitchen Capacity at Senior Center 156,798 Kortsen and I-10 Design Concept Report Remodel Animal Control Sally Port 303,323 68,533 Station 502 Additional Bay & Bunkroom 140,023 Taxiway E Rehabilitation 19,906 Thornton Road Reconstruction - Phase 1 1,303,321 $ NOTE 18 2,499,989 SUMMARY OF INTERFUND TRANSACTIONS Interfund transactions as of June 30, 2015, were as follows: Interfund Receivable/Payable: Receivable Amount Fund General Fund $ Non-Major Funds Internal Service Fund Total Payable Amount 1,067,545 $ $ 1,067,545 847,795 219,750 $ 1,067,545 The inter fund balances at June 30, 2015 are short-term loans to cover temporary cash deficits in various funds. 89 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 18 SUMMARY OF INTERFUND TRANSACTIONS (Continued) Transfers: Fund General Fund Highway Users Fund Capital Replacement Non-Major Governmental Funds Water Fund Wastewater Fund Wastewater Development Fees Sanitation Fund Golf Course Internal Service Funds Total $ $ Transfers Out 2,207,255 532,900 786,646 610,536 36,600 523,300 155,000 548,000 103,900 502,424 6,006,561 $ $ Transfers In 2,041,606 129,879 1,375,923 2,266,387 155,000 37,766 6,006,561 Transfers between funds are required to move cash as payment for services, or to move cash from fund where revenue is recorded to fund where cost is incurred. NOTE 19 DEFICIT IN FUND BALANCE Two funds had deficits in fund balance. The HOME/HUD fund deficit decreased from $557 in the prior year to the current year balance of $556. It is expected that this deficit balance continue to decrease as intergovernmental revenues increase. The Municipal Airport operating fund deficit increased by $94,174 to a total of $556,485. The Municipal Airport is supported through fuel sales and hangar rentals which continue to be lower than expected. The increase in the deficit was attributed to the decrease in fuel sales. NOTE 20 SALES TAX INCENTIVE AGREEMENT In March, 2006 the City entered a tax-incentive agreement with WP Casa Grande Retail LLC in order to develop the Promenade at Casa Grande mall. WP Casa Grande Retail is paid 50% of the retail sales and construction activities tax collected by the City from Promenade sales. The agreement only applies to the portion of tax that is not a dedicated or special tax. The agreement is in effect for twenty years up to a maximum payment of $19,950,000 plus interest of 7%. There is a provision to extend the agreement for an additional three years if the amount remaining unpaid after twenty years is $3,000,000 or more (including accrued but unpaid interest). Payments are made to WP Casa Grande Retail within forty-five days after the end of each calendar quarter for 50% of the uncommitted tax collected during that quarter. The first payment to WP Casa Grande Retail was made in September, 2008. As of June 30, 2015 $6,173,434 (including $3,738,631 in interest) has been paid. 90 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 21 FUND BALANCE DETAILS BY CLASSIFICATION Major Governmental Non-Major Governmental Funds Funds General Fund balances: Nonspendable: Inventories Restricted for: Highway Users Revenue Fund Grants Systems Development Community Services Transportation Airport Improvement Debt Services Court Enhancement Housing Public Safety CFD Debt Capital Replacement Aesthetic Revitalization Assigned to: General Fund Reserves Parks Development Capital Replacement Redevelopment Promotion & Tourism 2009 Recreation Bond Wildland Fire/Public Safety Community Arts Unassigned Total fund balances $ 1,647 $ - $ 36,281 Total Governmental Funds $ 37,928 5,572,411 6,414,070 126,682 - 286,914 6,613,147 3,019,675 6,949,734 157,333 4,290,966 222,013 517,831 5,101,737 1,591,788 - 6,414,070 286,914 6,613,147 3,019,675 6,949,734 157,333 4,290,966 222,013 517,831 5,101,737 1,591,788 126,682 5,572,411 12,631,345 11,697,028 26,719,876 - 960,264 1,064,963 225,198 15,376 83,141 15,678 (593,322) 12,631,345 960,264 26,719,876 1,064,963 225,198 15,376 83,141 15,678 11,103,706 $ 29,902,431 $ 33,260,628 $ 30,558,717 $ 93,721,776 91 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO THE FINANCIAL STATEMENTS June 30, 2015 NOTE 22 RESTATEMENT OF NET POSITION Net position as of July 1, 2014, has been restated as follows for the implementation of GASB Statement No. 68, Accounting and Financial Reporting for Pensions, as amended by GASB Statement No. 71, Pension Transition for Contributions Made Subsequent to the Measurement Date, and a prior period adjustment moving debt from the Golf Course Fund to Governmental Activities. Governmental Activities Business-type Activities Wastewater Fund Water Fund Sanitation Fund Golf Course Fund Net Position as previously reported at June 30, 2014 $ 236,375,504 $ 62,812,480 $ 1,165,919 $ 44,630,929 $ 6,760,719 $ 1,050,490 (49,102,380) (5,170,557) (105,372) (1,266,909) (3,393,943) (404,333) 3,715,447 299,375 6,101 73,354 196,509 23,411 (45,386,933) (4,871,182) (99,271) (1,193,555) (3,197,434) (380,922) Prior period adjustment implementation of GASB 68: Net pension liability (measurement date as of June 30, 2013) Deferred outflows - City contributions made during fiscal year 2014 Total prior period adjustment Net position as restated, July 1, 2014 $ 190,988,571 $ 57,941,298 $ 1,066,648 $ 43,437,374 $ 3,563,285 $ 669,568 92 To Table of Contents REQUIRED SUPPLEMENTARY INFORMATION To Table of Contents To Table of Contents CITY OF CASA GRANDE, ARIZONA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF THE CITY'S PROPORTIONATE SHARE OF THE NET PENSION LIABILITY COST-SHARING PENSION PLAN June 30, 2015 Arizona Retirement System City's proportion of the net pension liability City's proportionate share of the net pension liability City's covered-employee payroll City's proportionate share of the net pension liability as a percentage of its covered-employee payroll Plan fiduciary net position as a percentage of the total pension liability Fiscal Year 2015 0.147102% $ 21,766,069 $ 12,967,224 167.85% 2014 through 2006 Information not available 69.49% 95 To Table of Contents CITY OF CASA GRANDE, ARIZONA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF CHANGES IN THE CITY'S NET PENSION LIABILITY (ASSET) AND RELATED RATIOS AGENT PENSION PLAN June 30, 2015 PSPRS - Police Fiscal Year 2015 Total pension liability Service cost Interest on the total pension liability Changes on benefit terms Differences between expected and actual experience in the measurement of the pension liability Changes of assumptions or other inputs Benefit payments, including refunds of employee contributions Net change in total pension liability Total pension liability - beginning (573,850) 4,417,506 (2,309,869) $ 6,120,633 35,135,780 Total pension liability - ending (a) $ 41,256,413 $ 1,015,910 2,707,371 863,565 Plan fiduciary net position Contributions - employer Contributions - employee Net investment income Benefit payments, including refunds of employee contributions Administrative expense Other changes Net change in plan fiduciary net position Plan fiduciary net position - beginning Plan fiduciary net position - ending (b) (782,663) 1,017,556 15,195,836 $ 16,213,392 City's net pension liability (asset) - ending (a) - (b) $ 25,043,021 $ 2014 through 2006 Information not available 1,604,579 539,514 1,965,995 (2,309,869) $ 96 To Table of Contents CITY OF CASA GRANDE, ARIZONA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF CHANGES IN THE CITY'S NET PENSION LIABILITY (ASSET) AND RELATED RATIOS AGENT PENSION PLAN (Continued) June 30, 2015 PSPRS - Police Fiscal Year 2015 Plan fiduciary net position as a percentage of the total pension liability Covered-employee payroll City's net pension liability (asset) as a percentage of coveredemployee payroll 2014 through 2006 39.30% $ 5,253,946 476.65% 97 To Table of Contents CITY OF CASA GRANDE, ARIZONA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF CHANGES IN THE CITY'S NET PENSION LIABILITY (ASSET) AND RELATED RATIOS AGENT PENSION PLAN (Continued) June 30, 2015 PSPRS - Fire Fiscal Year 2015 Total pension liability Service cost Interest on the total pension liability Changes on benefit terms Differences between expected and actual experience in the measurement of the pension liability Changes of assumptions or other inputs Benefit payments, including refunds of employee contributions Net change in total pension liability Total pension liability - beginning 288,360 1,859,876 (923,381) $ 3,975,499 20,268,828 Total pension liability - ending (a) $ 24,244,327 $ 817,489 1,586,947 346,208 Plan fiduciary net position Contributions - employer Contributions - employee Net investment income Benefit payments, including refunds of employee contributions Administrative expense Other changes Net change in plan fiduciary net position Plan fiduciary net position - beginning Plan fiduciary net position - ending (b) (331,791) 1,829,632 11,374,517 $ 13,204,149 City's net pension liability (asset) - ending (a) - (b) $ 11,040,178 $ 2014 through 2006 Information not available 991,261 555,093 1,538,450 (923,381) $ 98 To Table of Contents CITY OF CASA GRANDE, ARIZONA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF CHANGES IN THE CITY'S NET PENSION LIABILITY (ASSET) AND RELATED RATIOS AGENT PENSION PLAN (Concluded) June 30, 2015 PSPRS - Fire Fiscal Year 2015 Plan fiduciary net position as a percentage of the total pension liability Covered-employee payroll City's net pension liability (asset) as a percentage of coveredemployee payroll 2014 through 2006 54.46% $ 4,550,142 242.63% 99 To Table of Contents CITY OF CASA GRANDE, ARIZONA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF CITY PENSION CONTRIBUTIONS June 30, 2015 Arizona Retirement System Statutorily required contribution City's contributions in relation to the statutorily required contribution City's contribution deficiency (excess) City's covered-employee payroll City's contributions as a percentage of coveredemployee payroll Fiscal Year 2015 $ 1,246,572 $ 1,246,572 1,387,493 $ $ 11,457,463 $ $ 12,967,224 10.88% 10.70% PSPRS - Police Statutorily required contribution City's contributions in relation to the statutorily required contribution City's contribution deficiency (excess) City's covered-employee payroll City's contributions as a percentage of coveredemployee payroll 2014 1,387,493 Fiscal Year 2015 $ 1,825,522 $ 1,825,522 $ $ 5,733,423 2014 1,664,257 1,664,257 $ $ 31.84% 5,532,769 Fiscal Year 2015 924,690 $ City's contribution deficiency (excess) City's covered-employee payroll City's contributions as a percentage of coveredemployee payroll $ $ 4,163,395 $ 924,690 See accompanying notes to pension plan schedules. 22.21% 2013 through 2006 Information not available 30.08% PSPRS - Fire Statutorily required contribution City's contributions in relation to the statutorily required contribution 2013 through 2006 Information not available 2014 920,873 920,873 $ $ 2013 through 2006 Information not available 4,315,244 21.34% 100 To Table of Contents CITY OF CASA GRANDE, ARIZONA REQUIRED SUPPLEMENTARY INFORMATION NOTES TO THE SCHEDULE OF AGENT OPEB PLANS’ FUNDING PROGRESS June 30, 2015 NOTE 1 ACTUARIALLY DETERMINED CONTRIBUTION RATES Actuarial determined contribution rates for PSPRS are calculated as of June 30 two years prior to the end of the fiscal year in which contributions are made. The actuarial methods and assumptions used to establish the contribution requirements are as follows: Actuarial cost method Amortization method Remaining amortization period Asset valuation method Actuarial assumptions: Investment rate of return Projected salary increases includes inflation at Retirement age Mortality NOTE 2 Individual entry age normal Level percentage of payroll, closed 24 years for unfunded actuarial accrued liability, 20 years for excess 7-year smoothed market; 20% corridor 8.00%, net of investment and administrative expenses 5.00% to 9.00% including inflation 3.0% - 4.0% --approximate Experience-based table of rates that is specific to the type of eligibility condition. RP-2000 mortality table projected to 2015 using projection scale AA (adjusted by 105% for both males and females) FACTORS THAT AFFECT TRENDS Changes of benefit terms include the payout of Retro PBI and a change in the employee contribution rate. Changes of assumptions include a decrease in the wage assumption from 4.5% to 4.0% as well the inclusion of an assumption to explicitly value future PBI. In 2014 other changes also include the removal of assets specifically set aside for Health Insurance from Pension Assets. 101 To Table of Contents CITY OF CASA GRANDE, ARIZONA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF AGENT OPEB PLANS' FUNDING PROGRESS June 30, 2015 Health Insurance Premium Benefit Actuarial Valuation Date Actuarial value of assets (a) Actuarial accrued liability (b) Unfunded actuarial accrued liability (UAAL) (funding excess) (b) - (a) PSPRS Police 6/30/2014 6/30/2013 6/30/2012 $ 16,441,370 16,999,345 16,848,670 $ 41,256,413 35,135,780 34,240,024 $ 24,815,043 18,136,435 17,391,354 39.9% 48.4% 49.2% $ 5,253,943 5,248,916 5,196,630 472.3% 345.5% 334.7% PSPRS Fire 6/30/2014 6/30/2013 6/30/2012 $ 13,389,814 12,719,418 11,686,671 $ 24,244,327 20,268,828 19,503,044 $ 10,854,513 7,549,410 7,816,373 55.2% 62.8% 59.9% $ 4,550,140 4,231,402 4,559,461 238.6% 178.4% 171.4% Funded ratio (a)/(b) Annual covered payroll (c) See accompanying note to schedule of agent OPEB plans' funding progress. UAAL (funding excess) as a percentage of covered payroll (b) - (a)/(c) 102 To Table of Contents CITY OF CASA GRANDE, ARIZONA REQUIRED SUPPLEMENTARY INFORMATION NOTES TO THE SCHEDULE OF AGENT OPEB PLANS’ FUNDING PROGRESS June 30, 2015 NOTE 1 FACTORS THAT AFFECT TRENDS Beginning in fiscal year 2014, PSPRS established separate funds for pension benefits and health insurance premium benefits. Previously, the plan recorded both pension and health insurance premium contributions in the same Pension Fund. During fiscal year 2014, the plans transferred prior-year health insurance premium benefit contributions that exceeded benefit payments from each plan’s Pension Fund to the new Health Insurance Fund. 103 To Table of Contents To Table of Contents OTHER SUPPLEMENTARY INFORMATION COMBINING NON-MAJOR FUNDS FINANCIAL STATEMENTS To Table of Contents CITY OF CASA GRANDE, ARIZONA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS June 30, 2015 ASSETS Cash Investments Receivables (less allowance for uncollectibles) Due from other governments Inventory Restricted assets: cash and cash equivalents Total assets Municipal Airport $ 2,123 - LIABILITIES Accounts payable and other current liabilities Accrued wages and benefits Due to other funds Total liabilities DEFERRED INFLOWS OF RESOURCES Deferred revenue Total deferred inflows of resources 960,393 35,273 7,109 567,475 609,857 129 129 - 612 612 - - - 36,281 (592,766) (556,485) $ 53,372 15,678 Redevelopment $ 60,442 1,005,133 14,968 36,281 53,372 - FUND BALANCES Nonspendable Restricted Assigned Unassigned Total fund balances Total liabilities, deferred inflows of resources, and fund balances Special Revenue Parks Community Develop. Arts $ 46,946 $ 4,613 913,447 11,065 960,264 960,264 $ 960,393 $ 1,065,575 15,678 15,678 1,064,963 1,064,963 15,678 $ 1,065,575 106 To Table of Contents Promotion & Tourism $ 53,013 132,192 Court Enhancement $ 90,343 132,043 Special Revenue CDBG $ 709 - Self-help Technical Asst $ 6,542 - Home/HUD $ - Grants & Subsidies $ 24,447 248,627 252,601 437,806 5,254 227,640 146,517 428,809 58,502 488,020 6,542 9,669 202,939 212,608 5,627 5,627 2,789 2,789 479 1,160 76,826 78,465 - 556 556 18,650 21,740 40,390 - - 41,994 41,994 - - 80,331 80,331 367,561 367,561 6,542 6,542 - 225,198 225,198 $ Housing Programs $ 28,161 118,356 437,806 143,728 143,728 222,013 222,013 $ 227,640 $ 146,517 $ 488,020 $ 6,542 - 619 133,942 407,635 286,914 286,914 (556) (556) $ - $ 407,635 107 To Table of Contents CITY OF CASA GRANDE, ARIZONA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS (Continued) June 30, 2015 ASSETS Cash Investments Receivables (less allowance for uncollectibles) Due from other governments Inventory Restricted assets: cash and cash equivalents Total assets Special Revenue Wildland Fire/ Public Safety $ 26,252 63,356 1,239 90,847 LIABILITIES Accounts payable and other current liabilities Accrued wages and benefits Due to other funds Total liabilities DEFERRED INFLOWS OF RESOURCES Deferred revenue Total deferred inflows of resources FUND BALANCES Nonspendable Restricted Assigned Unassigned Total fund balances Total liabilities, deferred inflows of resources, and fund balances $ Debt Service General 2009 Excise Obligation Recreation $ $ 4,262,808 15,376 28,158 4,290,966 Capital Projects Community Services $ 1,156 3,042,969 15,376 3,044,125 5,230 1,996 7,226 - - 24,450 24,450 480 480 - - - 83,141 83,141 4,290,966 4,290,966 90,847 $ 4,290,966 15,376 15,376 $ 15,376 3,019,675 3,019,675 $ 3,044,125 108 To Table of Contents Transportation $ 103,295 6,846,439 $ 6,949,734 Airport Improvement $ 175,644 - System Development $ 124,083 6,530,666 Total Nonmajor Governmental Funds $ 1,337,045 28,449,191 5,126,714 1,480 1,001,032 1,591,788 31,765 207,409 6,654,749 726,635 230,702 36,281 1,001,032 31,780,886 219,563 32,005 847,796 1,099,364 Public Safety - 24,977 24,977 - 50,076 50,076 41,602 41,602 - - - - - 6,949,734 6,949,734 $ 5,126,714 Capital Projects Community Facilities $ 589,276 - 6,949,734 5,101,737 5,101,737 $ 5,126,714 1,591,788 1,591,788 $ 1,591,788 157,333 157,333 $ 207,409 122,805 122,805 6,613,147 6,613,147 $ 6,654,749 36,281 28,751,138 2,364,620 (593,322) 30,558,717 $ 31,780,886 109 To Table of Contents CITY OF CASA GRANDE, ARIZONA COMBINING STATEMENTS OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NONMAJOR GOVERNMENTAL FUNDS Year Ended June 30, 2015 REVENUES Taxes: Property taxes Sales Tax Intergovernmental revenues Charges for services Investment earnings Contributions and donations Rental and sale of city property Miscellaneous Total revenues EXPENDITURES Current: General government Public safety Culture and recreation Economic development Capital outlay Debt service: Principal Interest and fiscal charges Total expenditures Special Revenue Parks Community Develop. Arts Municipal Airport $ 605,233 - $ 700 $ - Redevelopment $ 8 743 208,984 2,509 816,726 18,273 25,001 43,974 430 438 743 748,650 125,625 577 - 4,096 - 48,797 - 874,275 577 4,096 48,797 Excess (deficiency) of revenues over (under) expenditures (57,549) 43,397 (3,658) (48,054) OTHER FINANCING SOURCES (USES) Transfers in Transfers out Total other financing sources and uses 9,375 (46,000) (36,625) - 5,000 5,000 - Net change in fund balances (94,174) 43,397 1,342 (48,054) Fund balances - beginning of year (462,311) 916,867 14,336 1,113,017 15,678 $ 1,064,963 Fund balances - end of year $ (556,485) $ 960,264 $ 110 To Table of Contents Promotion & Tourism $ $ 262,025 203 383,777 23,597 669,602 Court Enhancement 32,156 298,572 - 76,287 1,835 85,719 - 251,385 - - 32,155 - 391,320 527,608 900 217,250 298,572 78,122 85,719 251,385 - 32,155 1,137,078 371,030 62,390 (40,127) (74,037) - 1 275,300 (300,000) (24,700) 12,300 (62,300) (50,000) - - - 346,330 12,390 (40,127) (74,037) - (121,132) 209,623 183,855 441,598 6,542 $ 161,074 - 367,561 $ $ - 6,542 $ 32,156 - Grants & Subsidies - 143,728 $ Home/HUD 16,274 177,348 $ 36,000 4,131 91 Self Help Tech Asst 5,370 45,592 222,013 $ CDBG 140,512 $ 9,718 130,690 104 Special Revenue 698,761 240 220,056 919,057 225,198 $ Housing Programs $ (218,021) - 55,101 (18,606) 36,495 1 (181,526) (557) $ (556) 468,440 $ 286,914 111 To Table of Contents CITY OF CASA GRANDE, ARIZONA COMBINING STATEMENTS OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NONMAJOR GOVERNMENTAL FUNDS (Continued) Year Ended June 30, 2015 REVENUES Taxes: Property taxes Sales Tax Intergovernmental revenues Charges for services Investment earnings Contributions and donations Rental and sale of city property Miscellaneous Total revenues Special Revenue Wildland Fire/ Public Safety $ EXPENDITURES Current: General government Public safety Culture and recreation Economic development Capital outlay Debt service: Principal Interest and fiscal charges Total expenditures Debt Service General 2009 Excise Obligation Recreation $ Capital Projects Community Services 29,460 43 $ 2,286,570 2,470 23,658 53,161 2,289,040 10 10 $ 69,648 - 5,080 - 4,635 - 24,450 69,648 600,000 1,049,765 1,654,845 931,483 947,502 1,883,620 24,450 88,540 2,307 90,847 Excess (deficiency) of revenues over (under) expenditures (16,487) 634,195 (1,883,610) 66,397 OTHER FINANCING SOURCES (USES) Transfers in Transfers out Total other financing sources and uses - (129,879) (129,879) 1,898,986 1,898,986 - (16,487) 504,316 Net change in fund balances Fund balances - beginning of year Fund balances - end of year $ 99,628 3,786,650 83,141 $ 4,290,966 15,376 $ 15,376 T 66,397 2,953,278 $ 3,019,675 112 To Table of Contents Public Safety Transportation $ 1,312,316 4,863 1,317,179 $ 866,284 3,660 869,944 Capital Projects Community Airport Facilities Improvement $ 495,976 27 $ 496,003 129,947 129,947 185,677 71,811 3,621 - 74,158 70,094 185,677 71,811 110,000 237,626 351,247 1,131,502 798,133 144,756 - - - 1,131,502 798,133 144,756 5,818,232 4,303,604 1,447,032 $ 6,949,734 $ 5,101,737 $ 1,591,788 $ System Development Total Nonmajor Governmental Funds $ $ 174,668 5,085 179,753 2,782,546 262,025 1,097,116 3,181,862 20,554 220,056 611,034 96,839 8,272,032 123,242 1,047,222 537,255 568,110 501,815 819,984 144,252 154,436 1,641,483 2,234,893 7,350,762 (14,305) 25,317 921,270 10,325 10,325 (53,751) (53,751) 2,266,387 (610,536) 1,655,851 (3,980) (28,434) 2,577,121 31,194 161,313 6,641,581 27,981,596 157,333 $ 6,613,147 $ 30,558,717 113 To Table of Contents To Table of Contents OTHER SUPPLEMENTARY INFORMATION BUDGETARY COMPARISON SCHEDULES – GENERAL FUND LEGAL AND MAJOR FUNDS To Table of Contents To Table of Contents CITY OF CASA GRANDE, ARIZONA GENERAL FUND SCHEDULE OF EXPENDITURES - LEGAL LEVEL BUDGET COMPLIANCE Year Ended June 30, 2015 Budgeted Amounts EXPENDITURES General Government Mayor and Council Personal services Other expenditures City Manager Personal services Other expenditures Attorney Personal services Other expenditures Clerk Personal services Other expenditures Finance Personal services Other expenditures Information Technology Personal services Other expenditures Administrative Services Personal services Other expenditures Public Safety Police Personal services Other expenditures Fire Personal services Other expenditures Court Personal services Other expenditures Animal Control Personal services Other expenditures Public Works Personal services Other expenditures Culture and Recreation Personal services Other expenditures Planning and Economic Development Personal services Other expenditures Capital outlay Debt service Transfers out Total expenditures Original $ 159,100 1,853,300 Final $ 157,600 1,854,800 Actual Amounts $ 147,615 1,315,818 Budget Variance $ 9,985 538,982 700,000 127,700 688,000 139,700 669,412 123,983 18,588 15,717 752,200 61,500 752,200 61,500 717,550 61,115 34,650 385 303,900 118,000 303,900 118,000 276,825 78,860 27,075 39,140 874,700 182,500 874,700 182,500 826,025 228,467 48,675 (45,967) 833,700 917,900 833,700 875,400 812,719 840,876 20,981 34,524 561,700 176,600 561,700 186,600 507,060 156,906 54,640 29,694 11,250,000 1,919,800 11,117,200 2,046,200 10,822,966 1,682,187 294,234 364,013 6,490,500 897,500 6,490,500 905,500 6,452,171 918,038 38,329 (12,538) 521,100 92,200 521,100 97,200 504,403 111,716 16,697 (14,516) 257,300 99,000 225,300 131,000 211,653 140,214 13,647 (9,214) 1,241,900 196,800 1,245,900 226,600 1,115,754 198,132 130,146 28,468 3,330,300 2,347,200 3,335,000 2,419,800 3,216,744 2,372,987 118,256 46,813 1,588,500 402,100 1,750,500 95,200 2,679,600 1,589,000 401,600 1,875,700 2,670,900 1,514,067 260,843 122,405 2,207,255 74,933 140,757 1,753,295 463,645 $ 42,782,300 $ 42,888,800 $ 38,614,766 $ 4,274,034 117 To Table of Contents CITY OF CASA GRANDE, ARIZONA CAPITAL REPLACEMENT/RECREATION/DEVELOPMENT FUND SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended June 30, 2015 Budgeted Amounts REVENUES Investment earnings Miscellaneous revenue Construction sales tax Total revenues EXPENDITURES Contractual services Lease purchase principal & interest Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Transfers in Transfers out Proceeds from obligations Total other financing sources and uses Net change in fund balance Fund balance - beginning of year Fund balance - end of year Final 8,400 3,804,000 3,812,400 Actual Amounts $ 115,872 256,408 2,704,573 3,076,853 Variance with Final Budget $ 107,472 256,408 (1,099,427) (735,547) 257,700 40,200,600 40,458,300 25,000 257,700 41,223,600 41,506,300 38,583 505,341 4,495,387 5,039,311 (13,583) (247,641) 36,728,213 36,466,989 (37,889,900) (37,693,900) (1,962,458) 35,731,442 2,288,300 (1,445,300) 36,000,000 36,843,000 2,288,300 (1,445,300) 37,384,900 38,227,900 1,375,923 (786,646) 1,095,019 1,684,296 (912,377) 658,654 (36,289,881) (36,543,604) (278,162) (812,162) Original $ 8,400 2,560,000 2,568,400 (1,046,900) $ 534,000 27,124,720 27,124,720 27,124,720 $ 26,077,820 $ 27,658,720 $ 26,846,558 $ (812,162) 118 To Table of Contents OTHER SUPPLEMENTARY INFORMATION BUDGETARY COMPARISON SCHEDULES NON-MAJOR GOVERNMENTAL FUNDS To Table of Contents To Table of Contents CITY OF CASA GRANDE, ARIZONA MUNICIPAL AIRPORT SPECIAL REVENUE FUND SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET TO ACTUAL Year Ended June 30, 2015 Budgeted Amounts REVENUES Charge for service Rental and sale of city property Miscellaneous Total revenues EXPENDITURES Current: General government: Personal services Contractual services Materials and supplies Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Transfers in Transfers out Proceeds from obligations Total other financing sources and uses Net change in fund balance Fund balance - beginning of year Fund balance - end of year Original $ 925,800 235,600 500 1,161,900 Final $ 925,800 235,600 500 1,161,900 Actual Amounts $ 605,233 208,984 2,509 816,726 Variance with Final Budget $ (320,567) (26,616) 2,009 (345,174) 141,200 88,700 819,500 1,275,600 2,325,000 141,200 88,700 879,500 1,275,600 2,385,000 144,641 78,093 525,916 125,625 874,275 3,441 (10,607) (353,584) (1,149,975) 1,510,725 (1,163,100) (1,223,100) (57,549) 1,165,551 (46,000) 1,150,000 1,104,000 (46,000) 1,150,000 1,104,000 9,375 (46,000) (36,625) 9,375 (1,150,000) (1,140,625) (59,100) (119,100) (94,174) 24,926 (462,311) (462,311) (462,311) - $ (521,411) $ (581,411) $ (556,485) $ 24,926 121 To Table of Contents CITY OF CASA GRANDE, ARIZONA PARKS DEVELOPMENT SPECIAL REVENUE FUND SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET TO ACTUAL Year Ended June 30, 2015 Budgeted Amounts REVENUES Investment earnings Rental and sale of City property Miscellaneous Total revenues EXPENDITURES Current: Culture and recreation: Contractual services Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures Fund balance - beginning of year Fund balance - end of year Final 300 36,000 36,300 Actual Amounts $ 700 18,273 25,001 43,974 100,000 806,000 906,000 100,000 806,000 906,000 577 577 99,423 806,000 905,423 (869,700) (869,700) 43,397 913,097 916,867 916,867 916,867 Original $ 300 36,000 36,300 $ 47,167 $ $ 47,167 $ 960,264 Variance with Final Budget $ 400 (17,727) 25,001 7,674 $ 913,097 122 To Table of Contents CITY OF CASA GRANDE, ARIZONA COMMUNITY ARTS RESERVE SPECIAL REVENUE FUND SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET TO ACTUAL Year Ended June 30, 2015 Budgeted Amounts Final 2,300 2,300 Actual Amounts $ 430 8 438 12,100 1,300 13,400 12,100 1,300 13,400 3,638 458 4,096 8,462 842 9,304 Excess (deficiency) of revenues over (under) expenditures (11,100) (11,100) (3,658) 7,442 OTHER FINANCING SOURCES (USES) Transfers in Total other financing sources and uses 5,000 5,000 5,000 5,000 5,000 5,000 - (6,100) (6,100) 1,342 7,442 14,336 14,336 14,336 - REVENUES Miscellaneous Investment earnings Total revenues Original $ 2,300 2,300 EXPENDITURES Current: Culture and recreation: Contractual services Materials and supplies Total expenditures Net change in fund balance Fund balance - beginning of year Fund balance - end of year $ 8,236 $ $ 8,236 $ 15,678 Variance with Final Budget $ (1,870) 8 (1,862) $ 7,442 123 To Table of Contents CITY OF CASA GRANDE, ARIZONA REDEVELOPMENT/DOWNTOWN REVITALIZATION SPECIAL REVENUE FUND SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended June 30, 2015 Budgeted Amounts REVENUES Investment earnings Total revenues Original $ - EXPENDITURES Current: Economic development: Contractual services Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures Fund balance - beginning of year Fund balance - end of year $ $ Final - Actual Amounts $ 743 743 Variance with Final Budget $ 743 743 300,000 828,900 1,128,900 300,000 828,900 1,128,900 48,797 48,797 251,203 828,900 1,080,103 (1,128,900) (1,128,900) (48,054) 1,080,846 1,113,017 1,113,017 (15,883) $ (15,883) 1,113,017 $ 1,064,963 $ 1,080,846 124 To Table of Contents CITY OF CASA GRANDE, ARIZONA PROMOTION AND TOURISM SPECIAL REVENUE FUNDS SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended June 30, 2015 Budgeted Amounts REVENUES Local taxes Miscellaneous Facility Use Investment earnings Total revenues EXPENDITURES Current: General government: Contractual services Materials & supplies Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING USES Transfers in Transfers out Total other financing sources and uses Net change in fund balance Fund balance - beginning of year Fund balance - end of year Final 230,000 184,000 200 414,200 Actual Amounts $ 262,025 23,597 383,777 203 669,602 Variance with Final Budget $ 32,025 23,597 199,777 3 255,402 300,500 203,000 503,500 300,500 203,000 503,500 117,741 180,831 298,572 182,759 22,169 204,928 (89,300) (89,300) 371,030 460,330 275,300 (300,000) (24,700) 275,300 (300,000) (24,700) 275,300 (300,000) (24,700) (114,000) (114,000) 346,330 (121,132) (121,132) (121,132) $ (235,132) $ (210,432) Original $ 230,000 184,000 200 414,200 $ $ 225,198 460,330 $ 460,330 125 To Table of Contents CITY OF CASA GRANDE, ARIZONA COURT ENHANCEMENT/PROBATIONARY SPECIAL REVENUE FUND SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended June 30, 2015 Budgeted Amounts REVENUES Intergovernmental Charges for services Investment earnings Total revenues EXPENDITURES Current: Public safety: Personal services Contractual services Materials and supplies Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING USES Transfers in Transfers out Total other financing uses Net change in fund balance Fund balance - beginning of year Fund balance - end of year Final 13,500 150,000 163,500 Actual Amounts $ 9,718 130,690 104 140,512 56,300 96,000 12,400 159,900 324,600 56,300 99,500 10,900 157,900 324,600 20,231 50,809 5,247 1,835 78,122 36,069 48,691 5,653 156,065 246,478 (161,100) (161,100) 62,390 223,490 12,300 (62,300) (50,000) 12,300 (62,300) (50,000) 12,300 (62,300) (50,000) (211,100) (211,100) 12,390 209,623 209,623 209,623 Original $ 13,500 150,000 163,500 $ (1,477) $ $ (1,477) $ 222,013 Variance with Final Budget $ (3,782) (19,310) 104 (22,988) 223,490 $ 223,490 126 To Table of Contents CITY OF CASA GRANDE, ARIZONA HOUSING APPLICATION AND DEVELOPMENT FEES SPECIAL REVENUE FUNDS SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended June 30, 2015 Budgeted Amounts REVENUES Charges for service Intergovernmental Investment earnings Loan fees Total revenues EXPENDITURES Current: Economic development: Personal services Contractual services Materials and supplies Total expenditures Excess (deficiency) of revenues over (under) expenditures Fund balance - beginning of year Fund balance - end of year Final 10,100 112,000 5,400 127,500 Actual Amounts $ 4,131 36,000 91 5,370 45,592 Variance with Final Budget $ (5,969) (76,000) 91 (30) (81,908) 41,500 176,300 217,800 41,500 210,100 251,600 28,312 57,288 119 85,719 13,188 152,812 (119) 165,881 (126,300) (124,100) (40,127) 83,973 183,855 183,855 183,855 - Original $ 10,100 76,000 5,400 91,500 $ 57,555 $ $ 59,755 $ 143,728 $ 83,973 127 To Table of Contents CITY OF CASA GRANDE, ARIZONA COMMUNITY DEVELOPMENT BLOCK GRANT SPECIAL REVENUE FUND SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended June 30, 2015 Budgeted Amounts REVENUES Intergovernmental revenues Program income Total revenues EXPENDITURES Community development Personal services Contractual services Materials and supplies Internal charges Total expenditures Excess (deficiency) of revenues over (under) expenditures Fund balance - beginning of year Fund balance - end of year Original $180,000 180,000 Final $350,200 350,200 Actual Amounts $161,074 16,274 177,348 Variance with Final Budget ($189,126) 16,274 (172,852) 40,500 135,000 2,500 2,000 180,000 110,900 233,800 3,500 2,000 350,200 66,948 179,575 4,678 184 251,385 43,952 54,225 (1,178) 1,816 98,815 (74,037) (74,037) 441,598 - - - 441,598 441,598 $ 441,598 $ 441,598 $ 367,561 $ (74,037) 128 To Table of Contents CITY OF CASA GRANDE, ARIZONA HOME/HUD SPECIAL REVENUE FUND SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended June 30, 2015 Budgeted Amounts REVENUES Intergovernmental revenues Total revenues Original $ 275,000 275,000 EXPENDITURES Community development Personal services Contractual services Materials and supplies Total expenditures 40,800 233,800 400 275,000 Excess (deficiency) of revenues over (under) expenditures - (557) $ (557) Actual Amounts $ 32,156 32,156 40,800 233,800 400 275,000 - Fund balance - beginning of year Fund balance - end of year $ Final 275,000 275,000 (557) $ (557) Variance with Final Budget $ (242,844) (242,844) 32,155 32,155 40,800 201,645 400 242,845 1 1 (557) $ (556) $ 1 129 To Table of Contents CITY OF CASA GRANDE, ARIZONA GRANTS AND SUBSIDIES SPECIAL REVENUE FUND STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET TO ACTUAL Year Ended June 30, 2015 Budgeted Amounts REVENUES Intergovernmental revenues Investment earnings Contributions and donations Total revenues Final $ 1,711,200 259,600 1,970,800 67,900 1,000 500 5,000,000 5,069,400 179,600 26,700 33,000 870,900 1,110,200 286,861 23,070 81,389 169,460 560,780 (107,261) 3,630 (48,389) 701,440 549,420 113,800 17,800 157,000 288,600 113,800 227,200 157,000 117,700 615,700 119,727 210,903 196,978 47,790 575,398 (5,927) 16,297 (39,978) 69,910 40,302 5,358,000 1,725,900 900 900 1,137,078 (900) (900) 588,822 EXPENDITURES Public safety Personal services Contractual services Materials and supplies Capital outlay Total Public Safety Culture and recreation Personal services Contractual services Materials and supplies Capital outlay Total Culture and Recreation Community Development Contractual services Total Community Development Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES Transfers in Transfers out Total other financing sources and uses Net change in fund balance Fund balance - end of year (510,000) 244,900 (218,021) (462,921) 510,000 510,000 521,400 521,400 55,101 (18,606) 36,495 (466,299) (18,606) (484,905) 766,300 (181,526) (947,826) 468,440 468,440 468,440 468,440 $ 1,234,740 - Fund balance - beginning of year $ Actual Amounts $ 698,761 240 220,056 919,057 Variance with Final Budget$ (1,012,439) 240 (39,544) (1,051,743) Original $ 4,613,900 234,100 4,848,000 $ 286,914 $ (947,826) 130 To Table of Contents CITY OF CASA GRANDE, ARIZONA WILDLAND FIREFIGHTING/PUPLIC SAFETY SPECIAL REVENUE FUND SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended June 30, 2015 Budgeted Amounts REVENUES Intergovernmental revenue Investment earnings Contributions Total revenues EXPENDITURES Current: Wildland firefighting Public safety activities Total expenditures Excess (deficiency) of revenues over (under) expenditures Fund balance - beginning of year Fund balance - end of year $ Variance with Final Budget ($242,940) 43 10,658 (232,239) Original $272,400 13,000 285,400 Final $272,400 13,000 285,400 Actual Amounts $29,460 43 23,658 53,161 272,400 41,000 313,400 272,400 41,000 313,400 51,249 18,399 69,648 221,151 22,601 243,752 (28,000) (28,000) (16,487) 11,513 99,628 99,628 99,628 - 71,628 $ 71,628 $ 83,141 $ 11,513 131 To Table of Contents CITY OF CASA GRANDE, ARIZONA GENERAL OBLIGATION BOND DEBT SERVICE FUND SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended June 30, 2015 Budgeted Amounts Original $ 2,110,300 2,110,300 Final 2,110,300 2,110,300 Actual Amounts $ 2,286,570 2,470 2,289,040 Variance with Final Budget $ 176,270 2,470 178,740 4,000 5,200 5,080 120 545,500 1,003,300 1,552,800 545,500 1,003,300 1,554,000 600,000 1,049,765 1,654,845 557,500 556,300 634,195 77,895 OTHER FINANCING SOURCES (USES) Transfers out Total other financing uses (101,000) (101,000) (101,000) (101,000) (129,879) (129,879) (28,879) (28,879) Net change in fund balance 456,500 455,300 504,316 49,016 3,786,650 3,786,650 3,786,650 $ 4,243,150 $ 4,241,950 $ 4,290,966 REVENUES Property tax Investment earnings Total revenues EXPENDITURES Current: Contractual services Debt Service Principal retirement Interest Total expenditures Excess (deficiency) of revenues over (under) expenditures Fund balance - beginning of year Fund balance - end of year (54,500) (46,465) (100,845) $ 49,016 132 To Table of Contents CITY OF CASA GRANDE, ARIZONA RECREATION DEBT SERVICE FUND SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended June 30, 2015 Budgeted Amounts REVENUES Investment earnings Total revenues Original $ - EXPENDITURES Current: Contractual services Debt Service: Principal retirement Interest Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES Transfers in Total other financing uses Net change in fund balance Fund balance - beginning of year Fund balance - end of year $ $ Final - Actual Amounts $ 10 10 Variance with Final Budget $ 10 10 365 4,000 5,000 4,635 705,000 876,500 1,585,500 705,000 876,500 1,586,500 931,483 947,502 1,883,620 (226,483) (71,002) (297,120) (1,585,500) (1,586,500) (1,883,610) (297,110) 1,585,500 1,585,500 1,585,500 1,585,500 1,898,986 1,898,986 313,486 313,486 - (1,000) 15,376 16,376 - - - - - $ (1,000) $ 15,376 $ 16,376 133 To Table of Contents CITY OF CASA GRANDE, ARIZONA COMMUNITY SERVICES CAPITAL PROJECTS FUND SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended June 30, 2015 Budgeted Amounts Final 94,800 94,800 Actual Amounts $ 88,540 2,307 90,847 3,036,900 3,036,900 3,036,900 3,036,900 24,450 24,450 3,012,450 3,012,450 (2,942,100) (2,942,100) 66,397 3,008,497 2,953,278 2,953,278 2,953,278 11,178 $ 3,019,675 REVENUES Charges for Services Investment earnings Total revenues Original $ 94,800 94,800 EXPENDITURES Capital Outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures Fund balance - beginning of year Fund balance - end of year $ 11,178 $ $ Variance with Final Budget $ (6,260) 2,307 (3,953) $ 3,008,497 134 To Table of Contents CITY OF CASA GRANDE, ARIZONA TRANSPORTATION CAPITAL PROJECTS FUND SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended June 30, 2015 Budgeted Amounts Final 540,000 2,000 542,000 Actual Amounts $ 1,312,316 4,863 1,317,179 Variance with Final Budget $ 772,316 2,863 775,179 492,700 492,700 489,000 489,000 185,677 185,677 303,323 303,323 49,300 53,000 1,131,502 1,078,502 5,818,232 5,818,232 5,818,232 $ 5,867,532 $ 5,871,232 REVENUES Charges for Services Investment earnings Total revenues Original $ 540,000 2,000 542,000 EXPENDITURES Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures Fund balance - beginning of year Fund balance - end of year $ $ 6,949,734 $ 1,078,502 135 To Table of Contents CITY OF CASA GRANDE, ARIZONA PUBLIC SAFETY CAPITAL PROJECTS FUND SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended June 30, 2015 Budgeted Amounts REVENUES Charges for Services Investment earnings Total revenues Original $ 253,600 300 253,900 EXPENDITURES Capital outlay Total expenditures 287,000 287,000 Excess (deficiency) of revenues over (under) expenditures Fund balance - beginning of year Fund balance - end of year (33,100) $ Final 253,600 300 253,900 Actual Amounts $ 866,284 3,660 869,944 Variance with Final Budget $ 612,684 3,360 616,044 255,500 255,500 71,811 71,811 (183,689) (183,689) 798,133 799,733 (1,600) 4,303,604 4,303,604 4,303,604 $ 4,270,504 $ 4,302,004 $ 5,101,737 $ 799,733 136 To Table of Contents CITY OF CASA GRANDE, ARIZONA COMMUNITY FACILITIES DISTRICTS - CAPITAL PROJECTS SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended June 30, 2015 Budgeted Amounts REVENUES Property Tax Developer Contribution Investment Earnings Total revenues EXPENDITURES Contractual services Capital outlay Debt service Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Transfers out Total other financing sources and uses Net change in fund balance Fund balance - beginning of year Fund balance - end of year Final 493,800 104,800 598,600 Actual Amounts $ 495,976 27 496,003 Variance with Final Budget $ 2,176 (104,800) 27 (102,597) 42,800 1,508,100 347,600 42,800 1,508,100 347,600 3,621 347,626 39,179 1,508,100 (26) 1,898,500 1,898,500 351,247 1,547,253 (1,374,900) (1,299,900) 144,756 1,444,656 (75,700) (75,700) (75,700) (75,700) (1,450,600) (1,375,600) 1,447,032 1,447,032 1,447,032 71,432 $ 1,591,788 Original $ 493,800 29,800 523,600 $ (3,568) $ $ - 75,700 75,700 144,756 1,520,356 $ 1,520,356 137 To Table of Contents CITY OF CASA GRANDE, ARIZONA AIRPORT IMPROVEMENT CAPITAL PROJECTS FUND SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended June 30, 2015 Budgeted Amounts REVENUES Intergovernmental revenues Total revenues EXPENDITURES Contractual services Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES Transfers in Total other financing sources Net change in fund balance Fund balance - beginning of year Fund balance - end of year Original $ 2,005,300 2,005,300 Final $ 1,397,200 1,397,200 Actual Amounts $ 129,947 129,947 100,000 1,956,700 2,056,700 100,000 1,340,000 1,440,000 74,158 70,094 144,252 Variance with Final Budget $ (1,267,253) (1,267,253) 25,842 1,269,906 1,295,748 (51,400) (42,800) (14,305) 28,495 25,800 25,800 17,100 17,100 10,325 10,325 (6,775) (6,775) (25,600) (25,700) (3,980) 21,720 161,313 161,313 $ (3,492,587) $ (3,496,587) 161,313 $ 157,333 $ 21,720 138 To Table of Contents CITY OF CASA GRANDE, ARIZONA SYSTEM DEVELOPMENT FUND SCHEULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE BUDGET TO ACTUAL Year Ended June 30, 2015 Budgeted Amounts REVENUES Charges for services Change in fair value of investments Investment earnings Total revenues EXPENDITURES General government Culture and recreation Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES ( USES) Transfers out Total other financing sources and uses Net change in fund balance Fund balance - beginning of year Fund balance - end of year $ Actual Amounts $174,668 5,085 179,753 Variance with Final Budget$12,668 4,085 16,753 Original $87,000 1,000 88,000 Final $162,000 1,000 163,000 1,501,800 1,144,000 2,645,800 1,522,500 1,144,000 2,666,500 31,194 123,242 154,436 1,491,306 1,020,758 2,512,064 (2,557,800) (2,503,500) 25,317 2,528,817 (86,000) (86,000) (86,000) (86,000) (53,751) (53,751) 32,249 32,249 (2,643,800) (2,589,500) (28,434) 2,561,066 6,641,581 6,641,581 6,641,581 3,997,781 $ 4,052,081 $ 6,613,147 $ 2,561,066 139 To Table of Contents To Table of Contents OTHER SUPPLEMENTARY INFORMATION SCHEDULE OF OPERATIONS ENTERPRISE FUNDS To Table of Contents To Table of Contents CITY OF CASA GRANDE, ARIZONA COPPER MOUNTAIN RANCH WATER ENTERPRISE FUND SCHEDULE OF OPERATIONS - BUDGET AND ACTUAL Year Ended June 30, 2015 Budgeted Amounts OPERATING REVENUES: Service fees Miscellaneous Total operating revenues Original $ OPERATING EXPENSES: Personal services Contractual Materials and supplies Depreciation Total operating expenses Operating income NONOPERATING REVENUE (EXPENSES): Interest expense Income (loss) before transfers Transfers out Net change in Fund Balance Fund Balance - beginning of year - restated Fund Balance - end of year 216,200 400 216,600 $ 216,200 400 216,600 $ 192,343 192,343 Variance with Final Budget $ (23,857) (400) (24,257) 37,200 110,300 67,400 250,000 464,900 37,200 104,900 72,800 250,000 464,900 36,751 89,109 70,317 64,433 260,610 449 15,791 2,483 185,567 204,290 (248,300) (248,300) (68,267) 180,033 (15,100) (15,100) (1,064) 14,036 (263,400) (263,400) (69,331) 194,069 (36,600) (36,600) (36,600) (300,000) (300,000) (105,931) 1,066,648 $ Actual Amounts Final 766,648 1,066,648 $ 766,648 194,069 1,066,648 $ 960,717 $ 194,069 143 To Table of Contents CITY OF CASA GRANDE, ARIZONA WASTEWATER ENTERPRISE FUND SCHEDULE OF OPERATIONS - BUDGET AND ACTUAL Year Ended June 30, 2015 Budgeted Amounts Original OPERATING REVENUES: Service fees Connection fees Miscellaneous Total operating revenues $ 8,982,000 5,000 6,000 8,993,000 OPERATING EXPENSES: Personal services Contractual Materials and supplies Depreciation Total operating expenses Operating income NONOPERATING REVENUE (EXPENSES): Interest income Interest expense Total nonoperating revenue (expense) Income (loss) before transfers Transfers in Transfers out Net change in Fund Balance Fund Balance - beginning of year - restated Fund Balance - end of year Final $ Actual Amounts Variance with Final Budget 8,982,000 5,000 6,000 8,993,000 $ 8,541,358 70,663 8,612,021 $ (440,642) (5,000) 64,663 (380,979) 915,100 1,610,500 2,512,000 1,521,400 6,559,000 915,100 1,538,300 2,798,200 2,516,000 7,767,600 844,978 1,103,217 1,595,728 3,373,418 6,917,341 70,122 435,083 1,202,472 (857,418) 850,259 2,434,000 1,225,400 1,694,680 469,280 (3,000) (5,467,100) (5,470,100) (3,000) (5,467,100) (5,470,100) 7,480 (2,115,738) (2,108,258) 10,480 3,351,362 3,361,842 (3,036,100) (4,244,700) (413,578) 3,831,122 155,000 (555,700) 155,000 (555,700) 155,000 (523,300) 32,400 (3,436,800) (4,645,400) (781,878) 3,863,522 44,630,929 44,630,929 43,437,374 $ 41,194,129 $ 39,985,529 $ 42,655,496 (1,193,555) $ 2,669,967 144 To Table of Contents CITY OF CASA GRANDE, ARIZONA WASTEWATER DEVELOPMENT FEES ENTERPRISE FUND SCHEDULE OF OPERATIONS - BUDGET AND ACTUAL Year Ended June 30, 2015 Budgeted Amounts OPERATING REVENUES: Fees Total operating revenues OPERATING EXPENSES: Depreciation Total operating expenses Original $ - Actual Amounts Final $ - $ - Variance with Final Budget $ - - - 86,690 86,690 (86,690) (86,690) Operating income - - (86,690) (86,690) NONOPERATING REVENUE : Interest income Total nonoperating revenue - - 1,208 1,208 1,208 1,208 - - (85,482) (85,482) Income (loss) before transfers Impact fees Transfers out Net change in Fund Balance Fund Balance - beginning of year Fund Balance - end of year 1,924,100 (155,000) 2,124,100 (155,000) 582,705 (155,000) (1,541,395) - 1,769,100 1,969,100 342,223 (1,626,877) 9,204,423 9,204,423 9,204,423 $ 10,973,523 $ 11,173,523 $ 9,546,646 $ (1,626,877) 145 To Table of Contents CITY OF CASA GRANDE, ARIZONA SANITATION/DEVELOPMENT ENTERPRISE FUND SCHEDULE OF OPERATIONS - BUDGET AND ACTUAL Year Ended June 30, 2015 Budgeted Amounts OPERATING REVENUES: Service fees Recycling revenue Miscellaneous Total operating revenues OPERATING EXPENSES: Personal services Contractual Materials and supplies Depreciation Closure and postclosure costs Total operating expenses Operating income NONOPERATING REVENUE (EXPENSES): Interest income Interest expense Total nonoperating revenue (expense) Income before transfers Transfers in Transfers out Excess (deficiency) of revenues Net change in Fund Balance Fund Balance - beginning of year - restated Fund Balance - end of year Original Final Actual Amounts Variance with Final Budget $ 6,470,000 120,000 3,000 6,593,000 $ 6,470,000 120,000 3,000 6,593,000 $ 6,624,819 114,977 20 6,739,816 2,540,100 1,317,200 1,084,400 1,909,100 150,000 7,000,800 2,540,100 1,321,000 1,083,600 1,800,500 150,000 6,895,200 2,422,642 1,206,098 735,587 925,566 97,008 5,386,901 117,458 114,902 348,013 874,934 52,992 1,508,299 $ 154,819 (5,023) (2,980) 146,816 (407,800) (302,200) 1,352,915 1,655,115 (500) (3,000) (3,500) (500) (500) 2,992 2,992 3,492 3,492 (411,300) (302,700) 1,355,907 1,658,607 670,000 (1,372,000) 670,000 (1,372,000) (548,000) (1,783,300) (1,674,700) 807,907 3,563,285 3,563,285 3,563,285 $ 1,779,985 $ 1,888,585 $ 4,371,192 (670,000) 824,000 2,482,607 $ 2,482,607 146 To Table of Contents CITY OF CASA GRANDE, ARIZONA GOLF COURSE ENTERPRISE FUND SCHEDULE OF OPERATIONS - BUDGET AND ACTUAL Year Ended June 30, 2015 Budgeted Amounts OPERATING REVENUES: Rental Green fees Miscellaneous Total operating revenues Original $ OPERATING EXPENSES: Personal services Contractual Materials and supplies Depreciation Total operating expenses 142,200 983,000 4,600 1,129,800 Final $ 142,300 654,000 226,400 130,000 1,152,700 Operating income 142,200 983,000 4,600 1,129,800 142,300 654,000 226,400 130,000 1,152,700 $ Actual Amounts Variance with Final Budget 139,630 961,150 1,565 1,102,345 $ 112,378 649,900 252,649 181,060 1,195,987 (2,570) (21,850) (3,035) (27,455) 29,922 4,100 (26,249) (51,060) (43,287) (22,900) (22,900) (93,642) (70,742) NONOPERATING REVENUE (EXPENSE): Interest expense City sales tax Total nonoperating revenue (100,900) (26,300) (127,200) (100,900) (26,300) (127,200) 29,122 29,122 100,900 55,422 156,322 Income (loss) before transfers (150,100) (150,100) (64,520) 85,580 101,000 (103,900) 101,000 (103,900) 1,133,770 (103,900) 1,133,770 (101,000) - (153,000) (153,000) 965,350 1,118,350 669,568 669,568 669,568 516,568 $ 1,634,918 Contributions Transfers in Transfers out Net change in Fund Balance Fund Balance - beginning - restated Fund Balance - end of year $ 516,568 $ $ 1,118,350 147 To Table of Contents To Table of Contents OTHER SUPPLEMENTARY INFORMATION FIDUCIARY FUNDS To Table of Contents To Table of Contents CITY OF CASA GRANDE, ARIZONA COMBINING STATEMENT OF FIDUCIARY NET ASSETS ALL AGENCY FUNDS June 30, 2015 Flexible Spending Plan Fund Performance Bond Fund ASSETS Cash Investments, at fair value $ Total assets LIABILITIES Other liabilities Total liabilities NET ASSETS Held in trust for other purposes $ 1,948,066 $ 48,658 - Sun Corridor MPO Fund $ 12,346 - Total $ 61,004 1,948,066 1,948,066 48,658 12,346 2,009,070 1,948,066 48,658 12,346 2,009,070 1,948,066 48,658 12,346 2,009,070 - $ - $ - $ - 151 To Table of Contents CITY OF CASA GRANDE, ARIZONA COMBINING STATEMENT CHANGES IN ASSETS AND LIABILITIES ALL AGENCY FUNDS June 30, 2015 Balance June 30, 2014 Performance Bond Fund Assets: Cash Investments Total Assets $ Balance June 30, 2015 $ (383,721) (41,968) (425,689) 1,749,109 3,096 1,752,205 198,957 147,360 346,317 (150,456) (150,456) 1,948,066 1,948,066 41,684 41,684 173,977 173,977 (167,003) (167,003) 48,658 48,658 21,684 20,000 41,684 10,000 10,000 (3,026) - 18,658 30,000 48,658 74,276 74,276 298,973 298,973 (360,903) (360,903) 12,346 12,346 41,383 32,893 74,276 301,011 301,011 (114,900) (248,041) - (73,517) 85,863 12,346 Totals - All Agency Funds Assets: Cash Investments Total Assets 74,276 1,752,205 1,826,481 298,973 237,829 536,802 (360,903) (41,968) (402,871) 61,004 1,948,066 2,009,070 Liabilities: Other Liabilities Accounts Payable Total Liabilities 1,812,176 55,989 1,868,165 198,957 458,371 657,328 (117,926) (398,497) $ (516,423) 1,893,207 115,863 2,009,070 Flexible Spending Plan Fund Assets: Cash Total Assets Liabilities: Other Liabilities Accounts Payable Sun Corridor MPO Assets: Cash Total Assets Liabilities: Other Liabilities Accounts Payable $ $ Deductions 383,721 237,829 621,550 Liabilities: Other Liabilities Accounts Payable 1,752,205 1,752,205 Additions $ $ $ 1,948,066 1,948,066 152 To Table of Contents STATISTICAL SECTION To Table of Contents To Table of Contents STATISTICAL SECTION This part of the City of Casa Grande’s Comprehensive Annual Financial Report gives detailed information to help readers better understand what the information in the financial statements, note disclosures and required supplemental information says about the City’s overall financial health. Contents Financial Trends Page 156 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 166 These schedules contain information to help the reader assess the City’s most significant local revenue source, sales tax. Debt Capacity 170 These schedules present information to help the reader assess the affordability of the City’s current levels of outstanding debt and the City’s ability to issue additional debt in the future. Demographics and Economic Information 179 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. Operations 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. 181 To Table of Contents Schedule 1 City of Casa Grande Net Position by Component Last Ten Fiscal Years (accrual basis of accounting) Governmental activities Net investment in Capital Assets Restricted Unrestricted Total governmental activities net assets Business-type activities Net investment in Capital Assets Restricted Unrestricted Total business-type activities net assets Primary government Net investment in Capital Assets Restricted Unrestricted Total primary government net assets 2006 2007 June 30 2008 2009 2010 74,265,031 39,505,454 17,574,060 $ 131,344,545 $ 121,397,151 61,600,770 24,880,238 $ 207,878,159 $ 144,539,605 77,352,432 29,930,330 $ 251,822,367 $ 166,666,266 63,759,736 29,204,011 $ 259,630,013 $ 169,037,582 66,259,746 24,786,399 $ 260,083,727 $ $ $ $ $ $ $ 27,728,464 11,541,534 8,492,036 47,762,034 $ 101,993,495 51,046,988 26,066,096 $ 179,106,579 $ 29,545,366 15,292,233 9,374,364 54,211,963 $ 150,942,517 76,893,003 34,254,602 $ 262,090,122 $ 33,189,049 19,276,562 7,191,725 59,657,336 $ 177,728,654 96,628,994 37,122,055 $ 311,479,703 $ 42,819,605 16,814,023 1,188,222 60,821,850 $ 209,485,871 80,573,759 30,392,233 $ 320,451,863 $ 46,698,154 11,962,381 5,103,985 63,764,520 $ 215,735,736 78,222,127 29,890,384 $ 323,848,247 156 To Table of Contents 2011 2012 2013 2014 2015 $ 163,072,110 68,817,721 20,795,291 $ 252,685,122 $ 161,430,232 37,158,304 48,679,263 $ 247,267,799 $ 157,440,959 40,395,789 46,777,093 $ 244,613,841 $ 151,713,255 23,313,575 61,348,678 $ 236,375,508 $ 142,734,104 40,862,091 3,182,623 $ 186,778,818 $ $ $ $ $ $ 47,003,748 10,324,306 7,429,067 64,757,121 $ 210,847,017 78,350,244 28,244,981 $ 317,442,242 $ 49,361,435 11,742,168 3,708,031 64,811,633 $ 210,791,667 48,900,472 52,387,294 $ 312,079,433 $ 47,631,810 9,245,649 5,504,681 62,382,140 $ 205,072,769 49,641,438 52,281,774 $ 306,995,981 $ 51,371,884 6,187,139 5,253,457 62,812,480 $ 201,934,193 29,500,714 66,681,178 $ 298,116,085 $ 52,862,580 6,317,620 (11,231) 59,168,969 $ 195,596,684 47,179,711 3,171,392 $ 245,947,787 157 To Table of Contents Schedule 2 City of Casa Grande Changes in Net Position Last Ten Fiscal Years (accrual basis of accounting) 2006 Governmental Activities: Expenses General government Public safety Streets/Transportation Public works Culture and recreation Economic development Interest on long-term debt Total expenses Program Revenues Charges for services: General government Public safety Streets/Transportation Public works Culture and recreation Development fees Building permits Development and engineering Other economic development Operating grants and contributions Capital grants and contributions Total program revenues Total Governmental Activities Net Program Expense General Revenues and Other Changes in Net Position Property taxes Sales taxes Franchise taxes Shared revenues: State sales taxes Urban revenue sharing Auto-in-lieu Investment earnings Gain on sales of assets Miscellaneous Transfers Total general revenues and other changes in net position Total Governmental Activities Change in Net Position $ 4,463,957 13,504,033 5,486,251 1,868,890 4,978,247 4,468,076 500,879 35,270,333 $ 119,514 984,555 832,940 84,424 340,272 11,353,338 3,468,682 3,357,825 1,282,294 7,866,501 43,675,183 73,365,528 $ 38,095,195 June 30 2008 2007 5,196,569 14,765,435 9,650,354 2,144,675 5,247,404 5,564,781 610,630 43,179,848 $ 133,192 1,091,960 996,571 33,994 328,163 13,115,223 2,580,633 2,456,074 863,185 9,066,924 14,852,514 45,518,433 $ 2,338,585 6,958,153 17,799,896 10,614,899 1,652,940 5,853,610 5,932,564 641,914 49,453,976 2009 $ 144,550 1,214,170 1,345,035 100,784 378,268 8,272,278 1,692,576 694,885 627,986 9,303,041 22,402,954 46,176,527 $ (3,277,449) 2010 7,824,380 20,384,692 12,198,334 2,336,854 7,696,876 4,367,403 972,791 55,781,330 $ 131,394 1,410,573 1,297,796 23,399 378,961 1,332,296 635,045 96,008 379,636 8,859,174 7,360,861 21,905,143 $ (33,876,187) 6,961,775 20,366,672 12,007,921 2,335,926 6,828,387 4,700,480 2,145,146 55,346,307 153,150 1,135,284 1,144,798 9,736 469,536 1,414,107 494,055 55,896 842,301 7,469,173 4,841,012 18,029,048 $ (37,317,259) 2,401,386 14,973,622 1,236,366 2,475,296 22,708,648 1,511,751 3,105,864 28,082,890 1,687,014 6,264,879 23,313,628 1,910,594 7,422,710 19,776,002 1,947,031 2,721,554 2,728,207 1,585,116 1,508,717 660,798 361,586 349,200 28,526,552 3,086,185 3,760,034 2,032,801 3,222,176 1,846,201 274,310 449,800 41,367,202 2,984,122 4,592,697 2,199,266 3,202,760 452,693 388,409 525,942 47,221,657 2,583,416 4,793,336 2,126,092 815,213 2,382,825 4,106,244 2,034,181 107,521 440,101 (563,426) 41,683,833 625,779 (631,320) 37,770,973 $ 66,621,747 $ 43,705,787 $ 43,944,208 - $ 7,807,646 - $ 453,714 158 To Table of Contents 2011 $ 2012 6,875,962 20,265,216 12,554,956 2,067,097 7,103,723 3,731,265 2,436,221 55,034,440 $ 215,969 1,028,639 1,213,808 12,018 771,516 1,023,436 342,553 65,715 376,785 6,266,856 315,613 11,632,908 $ (43,401,532) 6,943,378 22,629,105 13,442,435 2,542,009 7,247,394 3,186,873 2,670,881 58,662,075 $ 173,396 1,370,883 1,369,817 26,595 601,627 161,576 290,999 40,880 429,012 7,420,053 3,507,353 15,392,191 $ (43,269,884) 2014 6,766,944 24,280,544 12,494,463 3,205,901 7,273,320 3,117,655 2,367,185 59,506,012 $ 342,086 1,182,158 1,112,963 60,757 443,652 2,198,089 988,908 74,375 416,676 6,823,705 10,177,899 23,821,268 $ (35,684,744) 2015 7,010,252 25,534,564 13,511,907 2,666,121 7,859,818 3,269,820 2,333,855 62,186,337 $ 10,107,662 26,520,689 13,548,310 2,771,028 7,676,615 2,765,522 2,504,944 65,894,770 304,629 1,345,626 960,368 33,133 502,803 110,170 846,542 16,393 163,809 7,163,717 1,333,697 12,780,887 2,815,852 1,076,004 816,829 167,447 430,294 179,753 1,081,880 78,284 307,578 6,775,967 4,132,231 17,862,119 $ (49,405,450) $ (48,032,651) 6,570,203 18,973,408 2,196,398 6,439,021 18,901,163 2,201,312 6,877,452 19,242,309 2,248,227 6,197,813 19,650,998 2,248,466 6,366,087 21,795,890 2,358,731 2,590,692 2,897,028 1,992,071 108,552 3,795,352 4,099,428 2,137,645 67,705 3,975,626 4,961,423 2,129,894 3,586 4,227,755 5,413,854 2,259,469 330,546 4,438,843 5,879,820 2,447,783 174,864 81,130 593,445 36,002,927 121,530 94,464 37,857,620 49,172 1,337,500 40,825,189 112,756 725,460 41,167,117 282,850 78,030 43,822,898 - $ 2013 (7,398,605) - $ (5,412,264) - $ 5,140,445 - $ (8,238,333) - $ (4,209,753) 159 To Table of Contents Schedule 3 City of Casa Grande Changes in Net Position Last Ten Fiscal Years (accrual basis of accounting) 2006 Business-type Activities: Expenses Water Golf course Wastewater Sanitation Total expenses Revenues Charges for services: Water Golf course Wastewater Sanitation Sales taxes Investment earnings Miscellaneous Capital grants and contributions Total revenues Total Business-type Activities Net Program Expense Other Changes in Net Position Transfers $ 98,048 928,321 3,138,128 3,538,650 7,703,147 $ 197,834 781,464 7,533,801 4,571,127 2,676,631 635,533 58,502 7,991,457 24,446,349 $ 16,743,202 June 30 2008 2007 115,599 1,107,942 5,413,331 3,902,782 10,539,654 $ 193,909 784,983 6,001,607 4,963,964 2,124,036 1,167,957 73,411 2,129,515 17,439,382 $ (349,200) 6,899,728 $ 16,394,002 $ 6,449,928 Total Primary Government Change in Net Position $ 83,015,749 $ 50,155,715 $ 190,125 797,501 5,972,329 4,990,169 14,203 919,273 155,834 2,580,813 15,620,247 $ (449,800) Total Business-type Activities Change in Net Position 117,638 967,750 4,522,025 4,041,517 9,648,930 2009 5,971,317 $ 196,410 962,206 5,119,786 4,555,927 20,612 202,016 323,560 717,407 12,097,924 $ (525,942) $ 153,147 1,266,986 4,610,789 5,465,908 11,496,830 2010 601,094 159,718 1,243,440 5,528,871 4,653,383 11,585,412 162,094 1,066,642 6,049,625 5,151,563 26,657 8,383 10,473 895,826 13,371,263 $ 563,426 1,785,851 631,320 5,445,375 $ 1,164,520 $ 2,417,171 $ 49,389,583 $ 8,972,166 $ 2,870,885 160 To Table of Contents 2011 $ 2012 150,493 1,203,084 5,561,882 5,028,014 11,943,473 $ 167,772 1,119,396 6,304,052 5,858,238 28,802 45,969 5,289 185,176 1,066,136 6,871,045 6,264,192 29,539 15,397 21,139 2,337,217 16,789,841 - 13,529,518 $ 1,586,045 $ (593,445) $ 992,600 $ (6,406,005) 190,786 1,303,013 9,786,826 5,060,239 16,340,864 448,977 (94,464) $ $ 354,513 (5,057,751) 2013 $ 226,382 1,299,400 9,188,433 4,953,994 15,668,209 2014 $ 173,935 994,534 6,541,782 6,151,881 25,737 40,519 60,209 545,163 14,533,760 $ (1,134,449) 286,210 1,212,036 9,559,101 5,410,150 16,467,497 2015 $ 181,120 1,076,014 8,027,267 6,385,562 29,098 8,917 57,654 587,959 16,353,591 $ (1,337,500) (113,906) $ (725,460) $ (2,471,949) $ (839,366) $ $ 2,668,496 $ (9,077,699) $ 261,674 1,195,987 9,119,769 5,386,901 15,964,331 192,343 1,100,780 8,541,358 6,739,816 29,122 11,680 72,228 582,705 17,270,032 1,305,701 (78,030) 1,227,671 (2,982,082) 161 To Table of Contents Schedule 4 City of Casa Grande Fund Balances, Governmental Funds Last Ten Fiscal Years (modified accrual basis of accounting) 2006 General Fund Reserved Unreserved Nonspendable Restricted Committed Assigned Unassigned Total general fund All Other Governmental Funds Reserved Unreserved, reported in: Special revenue funds Capital projects funds Nonspendable Restricted Committed Assigned Unassigned Total all other governmental funds $ 2007 1,476,273 17,796,454 - $ 2008 1,959,234 25,521,015 - $ 2009 2,548,121 30,572,472 - $ 2010 3,153,554 30,402,947 - $ 3,815,142 25,262,863 - $ 19,272,727 $ 27,480,249 $ 33,120,593 $ 33,556,501 $ 29,078,005 $ $ 4,413,184 $ 32,896,933 $ 25,327,803 $ 39,966,314 28,612,756 5,365,147 43,633,806 10,701,962 49,835,900 77,406 39,794,807 8,084 40,446,857 151,896 $ 38,228,011 $ 58,748,952 $ 82,810,239 $ 65,130,694 $ 80,565,067 4,250,108 - - - - - *FY2011: Implementation of GASB-54 Fund Balance Classification 162 To Table of Contents 2011* $ Fiscal Year 2013 2012 - - $ 7,411 33,225 23,342,866 - - $ 2014 - - $ 2015 - - $ 6,023 4,202,039 6,264 4,701,221 6,281 5,163,565 1,247,242 $ 24,630,744 19,251,625 502,264 $ 23,961,951 14,550,404 5,281,667 $ 24,539,556 13,384,358 6,892,105 $ 25,446,309 $ $ $ $ $ $ - - 57,949 13,250,249 1,083,515 50,374,649 (378,345) $ 64,388,017 - - 60,783 33,542,117 15,628,386 13,156,163 (385,290) $ 62,002,159 - - 66,983 35,694,573 2,523,457 27,643,540 (576,410) $ 65,352,143 - - 93,031 32,227,498 29,168,940 (576,846) $ 60,912,623 1,647 5,572,411 11,631,345 12,631,345 29,836,748 - - $ 36,281 35,291,890 0 29,084,496 (593,322) 63,819,345 163 To Table of Contents Schedule 5 City of Casa Grande Changes in Fund Balances, Governmental Funds Last Ten Fiscal Years (modified accrual basis of accounting) Revenues Taxes Licenses and permits Intergovernmental revenues Charges for services Fines Special assessments Investment earnings Rental and sale of city property Other revenues Total revenues Expenditures General government Public safety Streets/Transportation Public works Culture and recreation Planning and economic development Capital outlay Debt service Principal Interest Total expenditures Other Financing Sources (Uses) Transfers in Transfers out Capital leases Bond issuance Bond issuance costs Sale of land Total other financing sources (uses) Net change in fund balances Debt service as a percentage of noncapital expenditures 2006 2007 2008 $ 18,585,602 3,632,214 15,208,404 16,390,930 734,495 354,840 1,508,717 1,071,511 1,198,605 58,685,318 $ 26,706,698 2,756,899 18,007,273 16,678,803 826,533 28,907 3,222,176 1,459,760 720,635 70,407,684 $ 32,840,670 1,881,951 20,798,409 10,171,890 815,081 29,691 3,202,760 1,546,935 608,700 71,896,087 5,230,006 12,957,767 2,168,597 1,650,860 4,446,967 3,914,867 6,149,634 5,921,449 14,155,865 2,846,301 2,063,253 4,828,294 4,821,056 8,251,421 8,076,361 16,983,507 2,323,097 1,684,699 5,463,871 4,965,772 11,030,175 8,996,033 18,594,022 2,991,139 1,716,458 5,222,719 3,425,837 27,511,902 8,055,272 18,957,126 2,521,337 2,192,317 5,792,331 3,550,938 31,846,819 1,206,388 484,775 38,209,861 882,247 707,501 44,477,387 1,226,548 607,351 52,361,381 5,313,821 955,207 74,727,138 2,484,637 2,125,295 77,526,072 5,808,434 (5,374,834) 6,844,898 (6,311,098) 8,101,980 (7,483,839) 5,630,797 (5,922,924) 12,829,121 (13,965,253) 9,000,000 (30,201) 578,989 10,166,929 750,000 (103,736) 1,500,000 1,854,137 37,800,000 (472,067) - - 455,000 - 433,600 1,809,371 988,800 $ 20,909,056 $ 26,919,097 5.27% 4.39% 2009 - $ 29,701,635 4.44% $ 2010 31,334,264 808,414 17,188,146 2,188,466 1,092,331 21,092 815,213 1,645,235 536,204 55,629,365 $ - $ (17,243,635) 13.28% 29,088,943 656,902 16,769,422 2,058,720 978,765 8,883 107,521 2,106,527 514,473 52,290,156 - - 36,191,801 $ 10,955,886 10.09% 164 To Table of Contents 2011 $ Fiscal Year 2013 2012 27,556,571 546,628 14,151,581 1,661,339 807,884 $ - 27,524,503 494,921 17,627,429 2,856,201 756,454 $ - 28,352,139 1,263,721 20,814,430 4,024,127 735,217 2014 $ - 2015 28,304,305 1,055,340 19,166,537 2,614,233 707,660 $ 30,557,352 1,344,254 19,324,969 4,061,405 682,288 - - 108,549 1,489,826 349,597 46,671,975 67,707 502,054 1,599,077 51,428,346 3,586 537,055 477,857 56,208,132 339,728 536,601 968,313 53,692,717 207,833 761,495 821,199 57,760,795 8,026,262 19,691,260 2,770,032 1,959,265 5,847,772 2,652,964 24,677,470 7,932,235 20,516,232 3,287,682 1,913,991 5,939,441 2,467,005 8,999,838 7,473,914 22,089,961 2,717,802 2,040,691 6,041,037 2,424,452 10,215,671 7,801,503 22,673,464 2,645,606 1,350,102 6,413,990 2,526,552 10,651,896 7,810,453 21,380,603 2,821,113 1,352,469 6,157,841 2,276,725 6,889,725 1,899,760 2,594,138 70,118,923 3,669,732 2,733,203 57,459,359 1,718,222 2,343,898 57,065,648 1,528,344 2,448,448 58,039,905 1,959,805 2,520,693 53,169,427 11,790,392 (11,101,760) 17,492,942 (17,303,578) 7,243,155 (5,786,655) 3,328,600 8,818,190 (8,003,769) - 5,813,795 (4,137,337) 1,095,019 - 2,787,000 2,200,000 (66,000) - 2,822,632 $ (20,624,315) 9.89% - - - 2,976,364 $ (3,054,649) 13.21% - 4,785,100 $ 3,927,584 8.67% - 814,421 $ (3,532,767) 8.39% 2,771,477 $ 7,362,845 9.68% 165 To Table of Contents Schedule 6 City of Casa Grande Sales Tax Revenue by Industry Fiscal Years 2010 - 2015 Fiscal Year 2010 Percentage Tax Paid of Total Construction Manufacture Transportation/Communication/ Utilities Wholesale Trade Retail Trade Restaurants/Bars Insurance/Real Estate Hotels/Lodging Services All Other $ 3,558,323 594,982 17.82% 2.98% 2,053,502 238,731 9,361,417 1,228,270 1,751,628 390,430 433,326 355,036 Total $ 19,965,645 Fiscal Year 2011 Percentage Tax Paid of Total $ 2,545,580 575,026 13.36% 3.02% 10.29% 1.20% 46.89% 6.15% 8.77% 1.96% 2.17% 1.78% 2,009,759 246,612 9,430,292 1,227,699 1,793,481 449,581 432,552 336,162 100.00% $ 19,046,744 Fiscal Year 2012 Percentage Tax Paid of Total $ 1,802,508 461,262 9.41% 2.41% 10.55% 1.29% 49.51% 6.45% 9.42% 2.36% 2.27% 1.76% 2,217,902 287,453 9,836,562 1,285,661 1,897,474 483,410 500,029 391,070 11.57% 1.50% 51.33% 6.71% 9.90% 2.52% 2.61% 2.04% 100.00% $ 19,163,329 100.00% Source: Arizona State Department of Revenue Note: The categories presented are intended to provide alternative information regarding the sources of the City's revenue. 166 To Table of Contents Fiscal Year 2013 Percentage Tax Paid of Total $ 2,151,068 427,104 11.04% 2.19% 2,220,570 276,385 9,549,885 1,348,805 1,941,221 564,426 603,372 405,733 $ 19,488,568 Fiscal Year 2014 Percentage Tax Paid of Total $ 2,590,980 423,393 12.90% 2.11% 11.39% 1.42% 49.00% 6.92% 9.96% 2.90% 3.10% 2.08% 2,279,738 390,045 9,453,064 1,411,036 1,955,194 445,971 577,454 561,765 100.00% $ 20,088,640 Fiscal Year 2015 Percentage Tax Paid of Total $ 2,963,203 413,453 13.48% 1.88% 11.35% 1.94% 47.06% 7.02% 9.73% 2.22% 2.87% 2.80% 2,349,392 409,233 10,748,122 1,516,426 1,869,141 494,388 645,623 578,911 10.68% 1.86% 48.88% 6.90% 8.50% 2.25% 2.94% 2.63% 100.00% $ 21,987,890 100.00% 167 To Table of Contents To Table of Contents Schedule 7 City of Casa Grande Direct and Overlapping Sales Tax Rates As of June 30, 2015 City Rates State and Pinal County Combined Privilege tax, except retail, utilities and telecommunication 1.8% 6.7% 8.5% Retail (excluding food sales) 2.0% 6.7% 8.7% Retail - privilege tax for single item over $5000 1.5% 6.7% 8.2% Hotel/Motel 3.8% 6.7% 10.5% Restaurant/Bar 1.8% 6.7% 8.5% Utilities/Telecommunications 2.0% 6.7% 8.7% Construction 4.0% 6.7% 10.7% Jet Fuel 1.8% $.366/gal NA Real Property Rental Commercial Residential 1.8% 1.8% 0.5% 0.0% 2.3% 1.8% All Other Services Not Specified 1.8% 6.7% 8.5% Type of Tax (b) (a) (a) Includes a 2.2% tax on construction contracting activities the use of which is restricted to paying costs related to acquisition of capital assets and improvements included in the City's Capital Improvement Plan. (b) Includes the two-tenths (0.2) of one percent (1%) Economic Development and Recreation Excise Tax. The sale of a single item over $5,000 is taxed at 2.0% for the first $5,000, then the rate drops to 1.5% for the taxable amount exceeding $5,000. Sources: City of Casa Grande Finance Department and Arizona Department of Revenue 169 To Table of Contents Schedule 8 City of Casa Grande Ratios of Outstanding Debt by Type Last Ten Fiscal Years Fiscal Year 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 General Obligation Bonds 1,335,000 1,790,000 12,775,000 11,345,000 28,664,999 29,664,998 28,800,000 28,093,115 27,385,814 26,660,000 Governmental Activities Excise Tax Special Revenue Assessment Obligations Bonds 7,217,943 6,721,488 6,199,218 3,130,318 21,249,788 20,603,035 18,358,670 17,554,432 16,824,237 16,154,247 480,000 370,000 255,000 130,000 - Capital Leases 4,029,980 3,754,188 3,180,356 2,909,161 2,598,870 2,331,681 4,846,117 7,831,620 7,470,835 8,081,767 Business-type Activities Excise Tax/ General GO Bond Obligation Revenue Bonds Obligations - 14,911,877 14,388,332 13,855,602 13,304,502 12,735,032 12,125,001 11,266,335 12,002,655 11,187,135 9,300,748 Notes: Details regarding the City's outstanding debt can be found in the financial statements. (a) See Schedule 16 for personal income and population data. Personal income is based on Pinal County information. 170 To Table of Contents Business-type Activities Capital Leases 408,291 295,899 179,122 57,790 6,793 - Notes Payable 168,069 158,520 148,643 4,352,312 38,501,765 51,738,811 56,896,857 50,024,722 47,671,092 44,150,805 Total Primary Government 28,551,160 27,478,427 36,592,941 35,229,083 103,757,247 116,463,526 120,167,979 115,506,544 110,539,113 104,347,567 Percentage of Personal Income (a) 3.59% 3.12% 3.61% 3.16% 8.55% 8.66% 8.93% 8.59% 8.22% 7.76% Per Capita (a) 783.30 708.48 886.78 780.86 2,255.94 2,397.80 2,412.82 2,296.54 2,170.07 2,027.03 171 To Table of Contents Schedule 9 City of Casa Grande Ratio of General Bonded Debt Outstanding Last Ten Fiscal Years Fiscal Year General Obligation Bonds Estimated Actual Value of Property (a) Percentage of Estimated Actual Value of Property General Bonded Debt Per Capita (b) Restricted for Principal Payment 2006 1,335,000 8,183,338 16.31% NA 2007 1,790,000 39,939,824 4.48% 1,584 2008 2008 1,775,000 11,000,000 (1) (2) 93,675,428 2,295,221,460 1.89% 0.48% 664 267 2009 2009 2,515,000 8,830,000 (1) (2) 167,571,141 2,928,179,559 1.50% 0.30% 836 172 2010 2010 2,430,000 26,234,999 (1) (2) 249,681,000 3,680,064,800 0.97% 0.71% 807 510 2011 2011 4,555,000 25,109,998 (1) (2) 235,284,000 3,209,485,830 1.94% 0.78% 1,469 488 320,000 545,000 2012 2012 4,235,000 24,565,000 (1) (2) 313,880,004 3,145,296,113 1.35% 0.78% 1,366 477 100,000 625,000 2013 2013 4,135,000 23,940,000 (1) (2) 269,324,094 2,788,057,728 1.54% 0.86% 807 465 105,000 600,000 2014 2014 4,030,000 23,340,000 (1) (2) 279,975,183 2,833,543,388 1.44% 0.82% 786 453 110,000 595,000 2015 2015 3,920,000 22,740,000 (1) (2) 292,667,259 2,910,644,515 1.34% 0.78% 765 442 120,000 700,000 (a) Source: Pinal County Assessor's records (b) Estimated population of Mission Royale CFD 6/30/15 Estimated population of Villago CFD 6/30/15 Source: City of Casa Grande Development Center (c) Includes all City Bonded debt, net of assets restricted for payment of principal, Population of Casa Grande 3,502 1,625 51,478 (1) General obligation bonds were issued by the Mission Royale Community Facilities District in 2005 and the Villago Community Facilities District in 2006, 2008 and 2010. These bonds will be repaid by the property owners within the CFDs and are obligations of the districts only. (2) General obligation bonds were issued by the City of Casa Grande in June, 2008 and July, 2009. 172 To Table of Contents Schedule 10 City of Casa Grande Direct and Overlapping Governmental Activities Debt As of June 30, 2015 Bonded Debt Outstanding Governmental Unit Elementary School District #4 $ Estimated Share of Overlapping Debt Estimated Percentage Applicable 5,490,000 82.26% Union High School District #82 24,995,000 65.40% 16,347,965 Central Arizona Community College 85,940,000 16.54% 14,217,990 Mission Royale CFD 1,090,000 100.00% 1,090,000 Villago CFD 2,830,000 100.00% 2,830,000 Subtotal, overlapping debt City direct debt $ $ 38,894,252 100.00% Total direct and overlapping debt 4,516,914 39,002,869 38,894,252 $ 77,897,121 Sources: Assessed value data used to estimate applicable percentages provided by Pinal County Assessor's Office. Debt outstanding data provided by Pinal County Finance. Notes: Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the City. This schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents and businesses of Casa Grande. This process recognizes that, when considering the government's ability to issue and repay long-term debt, the entire burden borne by the residents and businesses should be taken into account. However, this does not imply that every taxpayer is a resident, and therefore responsible for repaying the debt, of each overlapping government. The percentage of overlapping debt applicable is estimated using taxable assessed property values. Applicable percentages were estimated by determining the portion of Pinal County's taxable assessed value that is within the government's boundaries and dividing it by the County's total taxable assessed value. 173 To Table of Contents Schedule 11 City of Casa Grande Legal Debt Margin Information June 30, 2015 Net Secondary Assessed Valuation as of June 30, 2015 (a) $ Debt limit (6% of assessed value) Debt applicable to limit: General obligation bonds Legal 6% debt margin 20,187,468 0 $ Debt limit (20% of assessed value) Debt applicable to limit: General obligation bonds Legal 20% debt margin 336,457,808 20,187,468 67,291,562 26,660,000 $ 40,631,562 Arizona's Constitution states that a municipality cannot issue general obligation bonds in excess of 6% of the assessed valuation for general municipal purposes. Additional general obligation bonds for up to 20% of assessed valuation can be issued for specific purpos such as supplying water and sewer services, artificial lighting, acquisition and development of land for open space preserves, parks, playgrounds, recreation facilities, public safety, law enforcement, fire and emergency service facilities, and streets and transportation facilities. (a) Source: Pinal County Assessor's records Note: The City issued General Obligation bonds for $11,000,000 in June, 2008 and $19,000,000 in August 2009. 174 To Table of Contents Schedule 12 City of Casa Grande Pledged-Revenue Coverage Last Nine Fiscal Years Special Assessment Bonds Transaction State Excise Tax Revenue Obligations State Licenses & Fiscal Privilege (Sales) Shared Shared Franchise Permits/Fines Year Tax (a)(b) Sales Tax Income Tax Tax & Forfeitures Debt Service Principal Interest Coverage 2007 $23,954,813 $3,086,185 $3,760,034 $1,511,751 $3,583,432 $1,050,000 $957,807 17.88 2008 2009 27,140,828 22,375,653 2,984,122 2,583,416 4,592,697 4,793,336 1,687,014 1,910,594 2,697,032 1,900,745 1,105,000 1,165,000 901,980 594,321 19.48 19.08 2010 18,566,490 2,382,825 4,106,244 1,947,031 1,635,667 950,001 1,054,202 14.29 2011 17,599,226 2,590,692 2,897,028 2,034,471 1,354,512 985,000 1,022,252 13.19 2012 18,179,713 3,795,352 4,099,428 2,330,056 1,109,259 1,515,000 1,644,925 9.34 2013 18,533,580 3,975,626 4,961,423 2,248,227 1,951,976 1,570,000 1,457,260 10.46 2014 19,143,334 4,227,755 5,413,854 2,248,466 1,727,402 1,385,000 1,403,535 11.75 2015 20,913,078 4,438,843 5,879,820 2,358,732 2,109,157 1,450,000 1,344,085 12.78 (a) The sale of a single item over $5,000 is taxed at 2.0% for the first $5,000, then the rate drops to 1.5% for the taxable amount exceeding $5,000. (b) Does not include the two-tenths of one percent (0.2%) Economic Development and Recreation Excise Tax which is pledged to the repayment of the 2009 Obligations and obligations issued on a parity therewith only (the "2009 Parity Obligations"). In connection with allocating the Excise Taxes among payments due with respect to the 2009 Parity Obligations and all Parity Obligations, the Economic Development and Recreation Excise Taxes will be applied first to the payments due with respect to the 2009 Parity Obligations and the Excise Taxes will then be allocated proportionately to the remaining payments due with respect to all Parity Obligations. The revenues from the Economic Development and Recreation Excise Tax for the last eight fiscal years have been: Fiscal Year 2007 2008 2009 2010 2011 2012 2013 2014 2015 Amount $877,870 956,265 958,587 936,142 946,029 983,656 954,988 945,306 1,074,812 175 To Table of Contents Schedule 13 City of Casa Grande Real & Personal Property Tax Levies and Collections Collected to June 30 End of Tax Fiscal Year (a) Fiscal Year 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Tax Levy $ 1,844,115 1,943,065 2,324,339 5,293,078 5,969,191 5,760,833 5,455,728 5,590,646 5,351,495 5,357,544 5,499,525 Collections $ 1,843,199 1,942,172 2,323,049 5,289,151 5,958,289 5,750,965 5,435,637 5,570,320 5,328,060 5,266,072 2,778,699 Taxes Receivable Percent of Tax Levy 916 894 1,290 3,928 10,903 9,868 20,092 20,325 23,436 91,472 2,720,826 99.95% 99.95% 99.94% 99.93% 99.82% 99.83% 99.63% 99.64% 99.56% 98.29% 50.53% Adjustments ($5,388) ($1,818) (38,322) (109,585) (19,966) (20,266) (24,416) (47,998) (22,930) (21,013) (11,146) (a) Reflects collections made through June 30, the end of the fiscal year, on such year's levy. Property taxes are payable in two installments. The first installment is due the first day of October and becomes delinquent on November 1. The second installment becomes due the first day of March and is delinquent on May 1. Interest at the rate of 16% per annum attaches on first and second installments following their delinquent dates unless the full year tax is paid by December 31. Penalties for delinquent payments are not included in the above collections figures. Source: Pinal County Treasuer's Office 176 To Table of Contents Schedule 14 City of Casa Grande Tax Rate Data Fiscal Year City's Primary Tax Rate Per $100 Assessed City's Secondary Tax Rate Per $100 Assessed City's Total Tax Rate Per $100 Assessed 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 $0.9999 0.9102 0.8774 0.7468 0.7135 0.8110 0.8988 0.9489 0.9999 $0.9999 $0.0000 0.0000 0.0000 0.6308 0.6308 0.6308 0.6308 0.6308 0.6308 $0.6308 $0.9999 0.9102 0.8774 1.3776 1.3443 1.4418 1.5296 1.5797 1.6307 $1.6307 Source: City of Casa Grande 177 To Table of Contents Schedule 15 City of Casa Grande Estimated Net Secondary Assessed Valuation of Major Taxpayers Type of Business/Property Taxpayers (a)(b) Arizona Public Service Co. Wp Casa Grande Retail LLC Wal-Mart Stores East LP Daisy Brand LLC Abbott Manufacturing Inc. Southwest Gas Corp. CG Hanna LLC Hexel Corp. Arizona Water Co. Courtney Mann LLC Daisy Brand LP Wal-Mart Stores Inc. Lowes HIW Inc. HSL Desert Sands Properties LLC Ehrmann Arizona Dairy LLC Electric Utility Retailer Retailer Dairy Product Manufacturing Gas Utility Pharmaceutical Manufacturing Real Estate Management Manufacturing Water Utility Vitamin Distributor Dairy Product Manufacturing Retailer Home Improvement & Construction Real Estate Management Dairy Product Manufacturing TOTAL Estimated 2014-15 Net Secondary Assessed Valuation As Percent of City's 2014-15 Net Secondary Assessed Valuation $11,545,760 9,513,541 7,990,545 4,697,960 5,156,497 3,420,593 3,669,081 4,653,483 2,972,711 1,935,016 2,401,569 2,384,179 1,873,909 1,871,731 4,060,132 $68,146,707 3.43% 2.83% 2.37% 1.40% 1.53% 1.02% 1.09% 1.38% 0.88% 0.58% 0.71% 0.71% 0.56% 0.56% 1.21% 20.25% (a) Some of such taxpayers or their parent companies are subject to the informational requirements of the Exchange Act, and in accordance therewith file reports, proxy statements and other information with Commission. The Filings may be inspected and copied at the public reference facilities maintained by the Commission at 450 Fifth St. N.W., Washington, D.C. 20549 and at the Commission's regional offices at Northwestern Atrium Center, 500 W. West Madison St., Suite 1400, Chicago, Illinois 60661. Copies of the Filings can be obtained from the public reference section of the Commission at 450 Fifth St., N.W., Washington, D.C. 20549 at prescribed rates. In addition, the Filings may also be inspected at the offices of the New York Stock Exchange at 20 Broad Street, New York, New York 10005. The Filings may also be obtained through the Internet on the Commission's EDGAR database at http://www.sec.gov. (b) The assessed valuation of property owned by the Salt River Project Agricultural Improvement and Power District ("SRP") is not included in the assessed valuation of the City in the table. Because of SRP's quasi-governmental nature, property owned by SRP is exempt from property taxation. However, SRP may elect each year to make voluntary contributions in lieu of property tax with respect to certain of its electrical facilities (the "SRP Electric Plant"). If SRP elects to make the in lieu contribution for the year, the full cash value of the SRP Electric Plant and the in lieu contribution amount is determined in the same manner as the full cash value and property taxes owed is determined for similar nongovernmental public utility property, with certain special deductions. If after electing to make the in lieu contribution, SRP then failed to make the in lieu contribution when due, the Treasurer of the Treasurer of the County and the City have no recourse against the property of SRP and the City. Source: Pinal County Treasurer's Office/Top Fifty Taxpayers 178 To Table of Contents Schedule 16 City of Casa Grande Demographic and Economic Statistics, Last Ten Fiscal Years Fiscal Year 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Population 36,450 38,785 42,422 45,116 45,993 48,571 49,804 50,296 50,938 51,478 County Per Capita Personal Income 21,800 22,672 23,905 25,000 26,373 27,690 21,716 21,419 21,409 20,983 Total Personal Income 794,610,000 879,333,520 1,014,097,910 1,127,900,000 1,212,973,389 1,344,930,990 1,081,543,664 1,077,290,024 1,090,531,642 1,080,162,874 School Enrollment Unemployment Rate 9,049 10,290 11,066 11,652 10,700 10,700 11,512 10,852 11,720 12,752 5.10% 4.30% 6.10% 11.10% 11.50% 11.50% 11.20% 9.10% 8.40% 6.80% Sources: Arizona Department of Commerce U.S. Bureau of Labor Statistics Casa Grande Elementary, Casa Grande Union High School Districts, and Charter Schools. U.S. Census Bureau 179 To Table of Contents Schedule 17 City of Casa Grande Principal Employers, Current Year and Nine Years Ago 2015 Employer Casa Grande Elementary School District Banner Casa Grande Medical Center Hexcel Corporation Wal-Mart Distribution Center Wal-Mart Supermarket Frito-Lay Inc. Abbott Laboratories/Ross Products City of Casa Grande National Vitamin Company Franklin Foods Sam's Club All Others Employees 896 650 500 608 440 not available 400 450 270 76 144 16,223 20,657 2006 Percentage of Total City Employment 4.34% 3.15% 2.42% 2.94% 2.13% Employees 761 920 365 569 520 450 425 340 Percentage of Total City Employment 1.94% 2.18% 1.31% 0.37% 0.70% 78.54% 10,501 5.12% 6.19% 2.46% 3.83% 3.50% 3.03% 2.86% 2.29% 0.00% 0.00% 0.00% 70.71% 100.00% 14,851 100.00% Sources: City of Casa Grande Arizona Department of Administration/Office of Employment & Population Statistics AZ Department of Commerce 180 To Table of Contents Schedule 18 City of Casa Grande Authorized City Government Employee Positions by Function/Program Last Ten Fiscal Years Function/Program Fiscal Year General Government Police, City Attorney and Court 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 26.0 30.0 39.3 39.5 37.3 37.3 38.8 38.3 46.7 46.7 107.5 123.1 139.0 137.2 128.8 125.8 126.4 135.3 142.1 141.9 Fire Culture and Recreation Planning and Development Public Works 41.0 54.8 60.5 62.1 63.3 62.3 62.3 62.3 62.3 62.3 44.0 48.0 61.3 61.8 68.3 67.3 66.6 51.0 76.4 75.5 22.0 26.5 34.5 34.0 31.0 31.0 24.5 21.5 21.0 21.0 84.3 96.3 104.5 104.5 100.5 97.8 99.4 102.0 100.6 100.8 Total 324.8 378.6 439.0 439.1 429.0 421.3 417.9 410.3 449.1 448.1 Source: City Budget Note: Information is based on authorized positions. 181 To Table of Contents Schedule 19 City of Casa Grande Operating Indicators by Function/Program Last Ten Fiscal Years Function/Program General government Registered voters Votes cast last primary election Fire Medical support calls Total alarms Inspections/investigations Public education contacts Police Calls for service Officer initiated Patrolled miles Traffic accidents Traffic citations Arrests (adult and juvenile) Culture and recreation - library (a) (b) (c) Items in collections Total circulation transactions Total circulation items Economic development Building permits - commercial Building permits - residential Self-help homes completed Self-help homes started Housing rehabilitations Code enforcement cases Planning cases 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 13,239 1,428 13,946 2,364 19,331 2,364 20,805 2,400 20,805 2,400 20,805 4,182 20,805 4,182 20,417 3,886 20,417 3,886 20,417 3,886 3,766 5,137 390 8,884 3,778 5,194 986 10,164 4,286 5,642 1,512 19,801 4,689 5,050 1,505 25,064 4,289 5,703 883 15,812 4,849 6,397 1,051 12,622 4,941 6,515 1,458 18,743 5,155 6,685 910 26,225 5,400 6,951 687 15,556 5,710 7,356 504 13,247 39,365 69,936 706,375 1,213 6,127 4,055 42,412 72,028 802,935 1,121 6,136 3,840 41,126 71,626 864,421 1,104 6,943 4,015 40,893 76,263 939,398 991 7,025 3,981 38,629 72,807 983,100 974 6,107 4,738 38,660 85,032 1,005,416 942 5,171 3,737 34,213 78,125 974,867 938 6,008 4,052 31,308 88,023 991,778 874 7,836 4,098 22,079 74,271 696,743 843 7,912 4,760 23,314 64,963 640,119 912 4,897 4,477 73,984 187,063 49,718 74,311 225,043 73,079 75,863 229,446 75,840 79,920 270,473 78,727 113,480 329,790 98,937 114,257 368,693 70,820 117,108 361,334 69,376 454,700 376,405 129,695 645,813 359,585 124,944 330,220 346,683 73,648 339 3,501 20 27 12 1,704 334 143 1,454 25 25 12 984 193 195 777 25 26 12 1,150 85 114 329 25 25 12 1,331 95 90 369 12 12 12 1,317 90 95 291 12 12 12 2,104 121 63 259 11 14 11 1,203 110 94 264 0 0 21 1,206 133 63 215 0 0 17 1,349 152 94 438 0 0 13 1,241 135 Sources: Various City departments Note: (a) Effective 2007 Library circulation transactions includes information transactions (b) Effective 2013 Library data includes both print and digital media (including digital books available through the Greater Phoenix Digital Library) (c) Circulation transactions and items were recalculated in 2014. 182 To Table of Contents Schedule 20 City of Casa Grande Capital Asset Statistics by Function/Program Last Ten Fiscal Years Function/Program Fire stations Parks and recreation Park areas Parkland acreage Community centers Golf courses Playgrounds Other maintenance areas Airport T-hangers T-shades Public works Total number of streetlights** Miles of streets (centerline)** Miles of sewer** Number of lift stations Number of signalized intersections* 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 3 3 3 3 3 4 4 4 4 4 24 1,370 4 1 24 87 25 1,371 4 1 24 88 26 1,387 5 1 25 93 26 1,396 5 1 26 93 27 1,566 5 1 26 95 27 1,611 5 1 26 97 27 1,611 5 1 26 97 27 1,611 5 1 26 99 27 1,611 5 1 26 99 27 1,611 5 1 26 99 52 18 52 18 52 18 52 18 52 18 52 18 52 18 52 18 52 18 52 18 2,217 375 300 9 31 3,130 375 375 9 31 3,302 389 450 9 35 3,500 410 455 10 38 3,363 410 455 10 39 5,340 410 455 10 41 5,340 414 455 10 41 3,948 409 284 10 41 3,988 403 290 10 42 3,996 396 290 10 43 * Includes ADOT signalized intersections **Enhanced GIS information utilized beginning in FY2013 Sources: Various City departments 183 To Table of Contents To Table of Contents COMPLIANCE SECTION To Table of Contents To Table of Contents INDEPENDENT AUDITORS’ REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Honorable Mayor and Council City of Casa Grande Casa Grande, AZ We have audited in accordance with the 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, the financial statements of the governmental activities, the business-type activities and each major fund of City of Casa Grande, Arizona as of and for the year ended June 30, 2015, and the related notes to the financial statements, which collectively comprise City of Casa Grande, Arizona’s basic financial statements, and have issued our report thereon dated December 24, 2015. Internal Control Over Financial Reporting In planning and performing our audit of the financial statements, we considered City of Casa Grande, Arizona’s internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City of Casa Grande, Arizona’s internal control. Accordingly, we do not express an opinion on the effectiveness of City of Casa Grande, Arizona’s internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or, significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. Tempe 2055 E. Warner Road Suite 101 Tempe, AZ 85284-3487 (480) 839-4900 Fax (480) 839-1749 Scottsdale 7098 E. Cochise Road Suite 100 Scottsdale, AZ 85253-4517 (480) 483-1170 Fax (480) 483-7126 Casa Grande 1115 E. Cottonwood Lane Suite 100 Casa Grande, AZ 85122-2950 (520) 836-8201 Fax (520) 426-9432 w w w . h e n r y a n d h o r n e . c o m To Table of Contents Compliance and Other Matters As part of obtaining reasonable assurance about whether City of Casa Grande, Arizona’s financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose. Casa Grande, Arizona December 24, 2015 To Table of Contents INDEPENDENT AUDITORS’ REPORT ON COMPLIANCE FOR EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY OMB CIRCULAR A-133 Honorable Mayor and Council City of Casa Grande Casa Grande, AZ Report on Compliance for Each Major Federal Program We have audited City of Casa Grande, Arizona’s compliance with the types of compliance requirements described in the OMB Circular A-133 Compliance Supplement that could have a direct and material effect on each of City of Casa Grande, Arizona’s major federal programs for the year ended June 30, 2015. City of Casa Grande, Arizona’s major federal programs are identified in the summary of auditors’ results section of the accompanying schedule of findings and questioned costs. Management’s Responsibility Management is responsible for compliance with the requirements of laws, regulations, contracts, and grants applicable to its federal programs. Auditors’ Responsibility Our responsibility is to express an opinion on compliance for each of City of Casa Grande, Arizona’s major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about City of Casa Grande, Arizona’s compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide a legal determination of City of Casa Grande, Arizona’s compliance. Tempe 2055 E. Warner Road Suite 101 Tempe, AZ 85284-3487 (480) 839-4900 Fax (480) 839-1749 Scottsdale 7098 E. Cochise Road Suite 100 Scottsdale, AZ 85253-4517 (480) 483-1170 Fax (480) 483-7126 Casa Grande 1115 E. Cottonwood Lane Suite 100 Casa Grande, AZ 85122-2950 (520) 836-8201 Fax (520) 426-9432 w w w . h e n r y a n d h o r n e . c o m To Table of Contents Opinion on Each Major Federal Program In our opinion, City of Casa Grande, Arizona, complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2015. Report on Internal Control Over Compliance Management of City of Casa Grande, Arizona, is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered City of Casa Grande, Arizona’s internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with OMB Circular A-133, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of City of Casa Grande, Arizona’s internal control over compliance. A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance. Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of OMB Circular A-133. Accordingly, this report is not suitable for any other purpose. Casa Grande, Arizona December 24, 2015 To Table of Contents City of Casa Grande Schedule of Expenditures of Federal Awards For the Year Ended June 30, 2015 U.S. Department of Housing and Urban Development: Passed through Arizona Department of Housing: Community Development Block Grant - 2012 Community Development Block Grant - 2014 Community Development Block Grant - 2015 HOME - 2013 Community Development Block Grant - Entitlement Grant Number Federal CFDA Number 132-12 106-14 113-15 14.228 14.228 14.228 9,189 * 92,178 * 52,107 * 153,474 304-13 B-15-MC-32-0007 14.239 14.218 32,154 36,200 * Total Department of Housing and Urban Development U.S. Department of Health & Human Services Passed through Pinal-Gila Council for Senior Citizens: Special Programs for the Aging Special Programs for the Aging Nutritional Services Incentive Program Total Aging Cluster Social Services Block Grant 221,828 5-237 5-237 5-237 93.044 93.045 93.053 13,859 84,415 15,883 114,157 5-237 93.667 12,360 Total Department of Health & Human Services Institute of Museum & Library Services Passed thru State Library Administrative Agencies Computers/ipads/software 126,517 2013-33020-D/2014-34026-7 45.310 Total Institute of Museum & Library Services US Dept of Interior National Park Service: Passed thru State Historic Preservation Office Historic Perservation U.S. Department of Justice: Bulletproof Vest Grant ARRA -Community Oriented Policing Services (COPS) Total Department of Justice U.S. Department of Transportation: FAA Airport Grant Passed thru Governor's Office of Highway Safety Selective Traffic Enforcement Truck LIDAR/Holsters Buckle UP Campaign Speed Awareness Trailer/Software Total Department of Transportation 22,480 22,480 AZ-12-011 15.904 Total Department of Interior National Park Service U.S. Department of Justice: JAG Grant JAG Grant Total Justice Assistance Grant Cluster Expenditures 900 900 2013-DJBX-0747 2014-H2551-AZ-DJ 16.738 16.738 3,934 21,021 24,955 2006BUBX 2010RKWX003 16.607 16.710 9,142 50,904 85,001 3-04-0007-17-2014 20.106 67,529 2014A-PT-090 2014-PT-049 2015-CIOT-003 20.600 20.600 20.600 38,299 3,267 7,172 48,738 2015-PT-052 20.608 9,144 125,411 191 To Table of Contents City of Casa Grande Schedule of Expenditures of Federal Awards For the Year Ended June 30, 2015 Executive Office of the President High Intensity Drug Trafficking Areas Program Grant Number Federal CFDA Number D08-12-2004 95.001 Total Executive Office of the President U.S. Department of Homeland Security Federal Emergency Management Agency Passed through Pinal-Gila Council for Senior Citizens: Emergency Food and Shelter National Board Program Passed through Arizona Division of Emergency Management: Arizona Dept of Homeland Security Passed through Arizona Department of Homeland Security: Operation Stonegarden Grant Program Operation Stonegarden Grant Program Total Department of Homeland Security Total Federal Financial Assistance and Expenditures of Federal Awards Expenditures 3,534 3,534 EMW-2013-FO-03279 97.044 102,114 * 97.024 4,600 130320-1 97.067 9,456 * 140315-01 130316-01 97.067 97.067 89,387 * 33,026 * 131,869 238,583 $ 824,254 *Denotes major program See accompanying notes. 192 To Table of Contents CITY OF CASA GRANDE, ARIZONA NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS Year ended June 30, 2015 NOTE 1 BASIS OF ACCOUNTING The accompanying Schedule of Expenditures of Federal Awards includes the federal grant activity of the City of Casa Grande (the “City”) and is presented on the modified accrual basis of accounting. The information in this schedule is presented in accordance with requirements of OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of the financial statements. NOTE 2 CATALOG OF FEDERAL DOMESTIC ASSISTANCE (CFDA) NUMBERS The program titles and CFDA numbers were obtained from the Catalog of Federal Domestic Assistance. 193 To Table of Contents CITY OF CASA GRANDE, ARIZONA SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED June 30, 2015 SECTION I – SUMMARY OF AUDITORS’ RESULTS Financial Statements Type of auditors’ report issued: Internal control over financial reporting:  Material weakness(es) identified?  Significant deficiency(ies) identified that are not considered to be a material weakness(es)? Noncompliance material to financial statements noted? Unmodified _ __ yes __X_ no ____ yes __X_ none reported ____ yes __X_ no Federal Awards Internal control over major programs:  Material weakness(es) identified?  Significant deficiency(ies) indentified that are not considered to be a material weakness(es)? ____ yes _X_ no ____ yes _X_ none reported Type of auditors’ report issued on compliance for each major program identified below: Unmodified Any audit findings disclosed that are required to be reported in accordance with section 510(a) of OMB Circular A-133? ____ yes __X_ no Identification of major programs: CFDA Numbers 14.218 14.228 97.044 97.067 Name of Federal Program or Cluster Department of Housing – Community Development Block Grant/Entitlement Grants Department of Housing – Community Development Block Grant/State’s program and Non-Entitlement Grants in Hawaii Department of Homeland Security – Assistance to Firefighters Grant Department of Homeland Security – Homeland Security Grant Program Dollar threshold used to distinguish between Type A and Type B programs: Auditee qualified as low-risk auditee? $300,000 _ _ yes _X_ no 194 To Table of Contents CITY OF CASA GRANDE, ARIZONA SCHEDULE OF FINDINGS AND QUESTIONED COSTS YEAR ENDED June 30, 2015 SECTION II – FINDINGS RELATED TO FINANCIAL STATEMENTS REPORTED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS None noted. SECTION III – FINDINGS AND QUESTIONED COSTS RELATED TO FEDERAL AWARDS None noted. SECTION IV – PRIOR YEAR FEDERAL AWARD FINDINGS AND QUESTIONED COSTS None noted. 195