This page left blank intentionally. City of Glendale, Arizona Annual Comprehensive Financial Report For the Fiscal Year Ended June 30, 2021 Prepared by the: Budget and Finance Department This page left blank intentionally. City of Glendale, Arizona ANNUAL COMPREHENSIVE FINANCIAL REPORT _________________________________________________________ INTRODUCTORY SECTION ___________________________ FOR THE FISCAL YEAR ENDED JUNE 30, 2021 This page left blank intentionally. City of Glendale, Arizona Annual Comprehensive Financial Report For the Fiscal Year Ended June 30, 2021 Mayor Jerry Weiers Councilmembers Ian Hugh - Vice Mayor, Cactus District Bart Turner - Barrel District Lauren Tolmachoff - Cholla District Jamie Aldama - Ocotillo District Ray Malnar - Sahuaro District Joyce Clark - Yucca District Management Staff Kevin Phelps - City Manager Vicki Rios - Assistant City Manager Jack Friedline - Assistant City Manager Prepared by Budget and Finance Department Lisette Camacho-Director i This page left blank intentionally. City of Glendale, Arizona Annual Comprehensive Financial Report For the Fiscal Year Ended June 30, 2021 TABLE OF CONTENTS I. Page INTRODUCTORY SECTION Title Page ......................................................................................................................................... i Table of Contents ...........................................................................................................................iii Letter of Transmittal ....................................................................................................................... 1 GFOA Certificate of Achievement.................................................................................................. 5 Glendale, Arizona and Neighboring Communities ......................................................................... 6 Glendale City Officials ................................................................................................................... 7 Glendale Council District Boundaries ............................................................................................. 8 Organization Chart .......................................................................................................................... 9 II. FINANCIAL SECTION Independent Auditors’ Report .............................................................................................................. 10 A. MANAGEMENT’S DISCUSSION AND ANALYSIS (MD&A) ............................................. 13 B. BASIC FINANCIAL STATEMENTS Government-Wide Financial Statements: Statement of Net Position .............................................................................................................. 25 Statement of Activities .................................................................................................................. 26 Fund Financial Statements: Balance Sheet – Governmental Funds........................................................................................... 28 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position ............................................................................................................................... 29 Statement of Revenues, Expenditures, and Changes in Fund Balances – Governmental Funds.................................................................................................................. 30 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities .............................................. 31 Statement of Net Position – Proprietary Funds ............................................................................. 32 Statement of Revenues, Expenses, and Changes in Fund Net Position – Proprietary Funds ........ 33 Statement of Cash Flows – Proprietary Funds .............................................................................. 34 Notes to the Financial Statements ..................................................................................................... 35 C. REQUIRED SUPPLEMENTARY INFORMATION Schedule of Net Pension/OPEB (Asset)/Liability ......................................................................... 90 iii City of Glendale, Arizona Annual Comprehensive Financial Report For the Fiscal Year Ended June 30, 2021 TABLE OF CONTENTS Schedule of OPEB Liability – City Plan ...................................................................................... 98 Schedule of Pension/OPEB Contributions .................................................................................. 100 Notes to Pension/OPEB Liability and Contributions .................................................................. 104 Budgetary Comparison Schedule – General Fund ...................................................................... 106 Budgetary Comparison Schedule – Transportation Special Revenue Fund ................................ 108 Budgetary Comparison Schedule – Other Special Revenue Fund .............................................. 109 Notes to Required Supplementary Information ........................................................................... 110 D. COMBINING STATEMENTS AND SCHEDULES Budgetary Comparison Schedule – Municipal Property Corporation Debt Service Fund .......... 112 Non-Major Governmental Funds Combining Balance Sheet........................................................................................................ 115 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances................ 121 Budgetary Comparison Schedules Police and Fire Sales Tax Fund ............................................................................................ 125 Community Development Block Grants Fund ..................................................................... 126 Highway Users Gas Tax Fund ............................................................................................. 127 General Obligation Debt Service Fund ................................................................................ 128 Highway User Debt Service Fund........................................................................................ 129 Transportation Debt Service Fund ....................................................................................... 130 Excise Tax Revenue Debt Service Fund .............................................................................. 131 Streets Construction Fund .................................................................................................... 132 Fire and Police Construction Fund ....................................................................................... 133 Parks Bond Construction Fund ............................................................................................ 134 Other Construction Fund ...................................................................................................... 135 Development Impact Fees Fund........................................................................................... 136 Cemetery Perpetual Care Fund ............................................................................................ 137 Non-Major Proprietary Funds – Business-Type Activities Combining Statement of Net Position ..................................................................................... 139 Combining Statement of Revenues, Expenses, and Changes in Fund Net Position ................ 140 Combining Statement of Cash Flows ...................................................................................... 141 Budgetary Comparison Schedules Water & Sewer Fund............................................................................................................ 142 Landfill Fund ....................................................................................................................... 143 Solid Waste Fund ................................................................................................................. 144 Housing Fund ....................................................................................................................... 145 iv City of Glendale, Arizona Annual Comprehensive Financial Report For the Fiscal Year Ended June 30, 2021 TABLE OF CONTENTS Internal Service Funds Combining Statement of Net Position ..................................................................................... 147 Combining Statement of Revenues, Expenses, and Changes in Fund Net Position ................ 148 Combining Statement of Cash Flows ...................................................................................... 149 Budgetary Comparison Schedules Risk Management Fund ....................................................................................................... 150 Employee Benefits Fund ...................................................................................................... 151 Workers Compensation Fund............................................................................................... 152 Fleet Services Fund .............................................................................................................. 153 Technology Fund ................................................................................................................. 154 E. SUPPLEMENTARY INFORMATION Federal Financial Data Schedule .......................................................................................... 155 III. STATISTICAL SECTION Schedule Page Net Position by Component ............................................................................................... 1 ............. 162 Changes in Net Position ..................................................................................................... 2 ............. 164 Fund Balances – Governmental Funds ............................................................................... 3 ............. 166 Changes in Fund Balances – Governmental Funds ............................................................ 4 ............. 167 Assessed and Estimated Actual Value of Taxable Property ............................................... 5 ............. 169 Direct and Overlapping Governments Property Tax Rates ................................................ 6 ............. 170 Principal Property Taxpayers ............................................................................................. 7 ............. 171 Property Tax Levies and Collections ................................................................................. 8 ............. 172 City Transaction Privilege Taxes (Sales Tax) by Category ................................................ 9 ............. 173 Ratio of Outstanding Debt by Type.................................................................................. 10 ............. 174 Ratios of Net General Bonded Debt Outstanding............................................................. 11 ............. 176 Net Direct and Overlapping Governmental Activities Debt ............................................. 12 ............. 177 Legal Debt Margin Information ....................................................................................... 13 ............. 178 Pledged-Revenue Coverage ............................................................................................. 14 ............. 179 Demographic and Economical Statistics .......................................................................... 15 ............. 181 Principal Employers ......................................................................................................... 16 ............. 182 Full-Time Equivalent City Government Employees by Function/Program ..................... 17 ............. 183 Operating Indicators by Function/Program ...................................................................... 18 ............. 184 Capital Asset Statistics by Function/Program .................................................................. 19 ............. 185 Miscellaneous Water and Sewer Rate Statistics ............................................................... 20 ............. 186 Miscellaneous Water and Sewer Statistics ....................................................................... 21 ............. 187 v This page left blank intentionally. December 21, 2021 To the Honorable Mayor, Members of the City Council, and Citizens of the City of Glendale, Arizona: The Budget and Finance Department is pleased to submit the City of Glendale, Arizona’s Annual Comprehensive Financial Report (ACFR) for the fiscal year ended June 30, 2021. The ACFR includes a complete set of financial statements presented in conformity with generally accepted accounting principles (GAAP). The financial statements are audited by a firm of licensed certified public accountants in accordance with generally accepted auditing standards (GAAS). City Management assumes full responsibility for the accuracy and completeness of the data, including all disclosures presented in this report. To provide a reasonable basis for making these representations, Management has established a comprehensive internal control framework that is designed to both protect the government’s assets from loss, theft, or misuse; and to compile sufficient reliable information for the preparation of the City’s financial statements in conformity with GAAP. Because the cost of internal controls should not outweigh their benefits, the City’s comprehensive framework of internal controls has been designed to provide reasonable rather than absolute assurance that the financial statements are free of material misstatement. To the best of our knowledge and belief, this financial report is complete and reliable in all material respects and is designed to fairly represent the financial position of the operations of the various funds of the City. This letter of transmittal is best reviewed in conjunction with the Management’s Discussion and Analysis (MD&A) beginning on page 13. The MD&A provides a narrative introduction, overview, and analysis of the basic financial statements of the City. Independent Audit The City’s financial statements have been audited by CliftonLarsonAllen LLP, a firm of licensed certified public accountants. The goal of the independent audit is to provide reasonable assurance that the financial statements of the City for the fiscal year ended June 30, 2021, are free of material misstatement. The independent audit involved examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements; assessing the accounting principles used and significant estimates made by management; and evaluating the overall financial statement presentation. The City’s independent auditors also perform the Single Audit of the City’s federal grant programs. The standards governing Single Audit engagements require the independent auditor to report not only on the fair presentation of the financial statements, but also on the audited government’s internal controls and compliance with legal requirements involving the administration of federal awards. The Single Audit Reporting Package is issued separately from this financial report and is available upon request. Budgetary Controls The annual budget serves as the foundation for the City’s financial planning and control. City departments are required to submit requests for appropriation to the City Manager on or before the last week of December each year. Management uses these requests to develop a budget to propose to the City Council for review and adoption. The City Council is required to hold public hearings on the proposed budget and adopt the final budget by the first Monday in August. The City maintains budgetary controls that are designed to ensure compliance with budgetary and legal provisions contained in the annually appropriated operating and capital project budgets approved by the City Council. The legal level of budgetary control (that is, the level at which expenditures cannot legally exceed the appropriated amount) is established at the city-wide level consisting of the total operating budget and the total capital projects budget, as adopted by the City Council. For budget 1 administrative purposes, the City maintains budgetary controls at the fund and department level. Department Heads may request transfers of appropriations within the same fund for his/her department. However, transfers of appropriations between funds and departments require approval of the City Council and can only occur in the last quarter of the fiscal year. The City adopts an annual appropriated budget for its General Fund, Special Revenue Funds, Capital Projects Funds, Debt Service Funds, Permanent Fund, and Enterprise Funds. Budget-to-actual comparisons are provided in this report for each individual governmental fund to demonstrate compliance with this budget. Arizona state law and Glendale City financial policies require that each annual city budget be a balanced budget. A balanced budget means the total expenditures cannot exceed the budgeted period’s total financial resources available. The adopted FY20-21 budget complies with the balanced budget requirement in all City funds. Additionally, the State of Arizona sets a limit on the expenditures of local jurisdictions. Compliance with these expenditure limitations is required. The City submits an expenditure limitation report as defined by the Uniform Expenditure Reporting System (A.R.S. Section 41-1279.07) along with audited financial statements to the State Auditor General within the required timeframe. City of Glendale Profile The City of Glendale, Arizona is the seventh largest city in the state with a population of approximately 254,000 people. Located in the northwestern part of the metropolitan Phoenix area and occupying approximately 62 square miles of land, the City is home to the Arizona Cardinals and the Arizona Coyotes. The City is also the owner of Camelback Ranch, the spring training facility for the Los Angeles Dodgers and the Chicago White Sox. The City was incorporated in 1910 and has operated under the council-manager form of government since its incorporation. Policy-making and legislative authority are vested in the City Council which consists of the Mayor and six other members. The City Council is responsible for, among other things, passing ordinances, adopting the budget, appointing committees, and hiring the City Manager, Clerk, Attorney, and Municipal Judge. The City Manager is responsible for carrying out the policies and ordinances of the City Council, for overseeing the day-to-day operations of the City, and for appointing the heads of the various departments. The Council is elected on a non-partisan basis. Council members serve four-year terms, with three Council members elected every two years. The Mayor is elected to serve a four-year term. The City provides a full range of services including police and fire services; water, sewer, and solid waste services; the construction and maintenance of highways, streets, public facilities, and other infrastructure; and recreational activities and cultural events. Certain housing services are provided by the City’s public housing authority, which functions, in essence, as a department of the City and therefore has been included as an integral part of the City’s financial statements. The City also is financially accountable for the Municipal Property Corporation, a legally separate entity, that is reported within the City’s financial statements. Economic Conditions and Strategies Before reviewing the presented financial statements, it is important to consider the local and global economic factors that have impacted the City’s financial position. Primary Revenue Sources The City relies on local and state shared sales tax as well as state shared income tax as primary revenue sources for the City’s operating budget. The City continued to recover from the effects of COVID-19 and its impacts to many local businesses particularly and travel reductions. The City still realized a year over year increase of 13.53% in local sales tax revenue for fiscal year 2021. The growth can be attributed to strong retail sales tax collections from online sales boosted by federal stimulus programs aiding the economic recovery, and economic development activities which generated additional construction sales tax revenue. The City’s state shared sales tax revenues also increased 15.55% compared to last fiscal year. 2 Workforce and Unemployment Glendale’s unemployment rate for the month of June 2021 was 7.4% which is about the same as the statewide unemployment rate of 7.3%. Glendale’s workforce is concentrated in the following nonfarm sectors: health care services (14.75%), government and social advocacy services (15.33%), retail (16.74%), consumer services (12.30%), education (10.23%), construction (7.03%), finance, insurance and real estate (5.91%), business services (5.16%), and transportation and distribution (3.73%). Through the Coronavirus pandemic (COVID-19) the unemployment rate was as low as 6.8% in fiscal year 2021. Arizona’s nonfarm employment increased 5.2% over the last year. Economic Development Business attraction, business retention & expansion, redevelopment, business assistance (ombudsman) and Arts & Culture comprise the five pillars of Glendale’s economic development program. Economic development efforts have been focused on the recently annexed Loop 303 area (the new frontier) which provides thousands of acres of developable land. Red Bull, in partnership with Ball Corporation and Rauch, completed the construction of their first manufacturing facility just over a year ago, and have since expanded their operations in the area. The new frontier has also welcomed other global corporations like Wal-Mart and Amazon. The capital investments from these major corporations contributed to the growth in Glendale. The City’s Sports and Entertainment District continues to experience new major additions. YAM properties, the commercial real estate company owned by GoDaddy founder Bob Parson, purchased the Westgate Entertainment District in 2018. Since then, YAM Properties made several announcements on the addition of new experiential sites coming to Westgate. Tiger Woods’ Pop Stroke will be opening on a site near Dave & Buster’s and Thirsty Lion Gastropub is building their largest restaurant to date. Adding to the expansion of hospitality and entertainment was the groundbreaking of Crystal Lagoons Island Resort that will be located just south of State Farm Stadium along the Loop 101. The Crystal Lagoons Island Resort will include over 600 new hotel rooms, a 10-acre lagoon, retail, restaurant, and mixed-use entertainment options. The sustained capital investment and increased ability to accommodate more visitors during events supports the City’s longterm vision. In Arrowhead, Volvo, Land Rover and Jaguar opened their dealerships, adding to the luxury vehicle lineup along the Loop 101. Phoenix Children’s Hospital announced their plans for an Arrowhead campus that will offer inpatient care, an emergency department, an outpatient surgery center, and a multi-specialty clinic. The $134.7 million investment will bring additional jobs and much needed pediatric services to the West Valley. Downtown Glendale launched the new LiVE @ Murphy Park concert series and the City’s Arts Commission played a key role by providing funding for promotional elements that were created by local artists. The industrial corridor near Downtown Glendale has also seen a boost in businesses coming to the area. Mattress manufacturer, Brooklyn Bedding began construction of their new headquarters and manufacturing facility. Located at 51st Avenue and Bethany Home Road, the state-of-the-art building will be nearly 650,000 squarefeet and brings 400 jobs to Glendale. Financial Strategy As part of the annual budget process, the city prepares a five-year financial forecast for each of the City’s major operating funds. The forecast provides a long-term view of current year budget decisions affecting the City and provides an estimate of fund balance and sensitivity to revenue and expenditure changes over the forecast period. Through sound financial planning and positive economic conditions, the City’s General Fund balance continues to improve. The general fund realized an increase in fund balance of $42.5 million in fiscal year 2021. This increase is primarily due to $28.5 million of sales tax collections which was a result of strong consumer spending boosted by federal stimulus programs aiding economic recovery. 3 Awards and Acknowledgements The Government Finance Officers Association (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City for its Annual Comprehensive Financial Report (ACFR) for the fiscal year ended June 30, 2020. This was the thirty-third consecutive year the City has received this prestigious award, and the thirty-fifth year overall. In order to be awarded a Certificate of Achievement, the government published an easily readable and efficiently organized ACFR. This report satisfied both GAAP and applicable legal requirements. A Certificate of Achievement is valid for a period of one year only. We believe that our current ACFR continues to meet the Certificate of Achievement Program’s requirements and we are submitting it to the GFOA to determine its eligibility for another certificate. In addition, the City also received the GFOA’s Distinguished Budget Presentation Award for its fiscal year beginning July 1, 2020. This was the thirty-fourth consecutive year that the City has received the highest form of recognition in governmental budgeting. The preparation of this report would not have been possible without the efficient and dedicated services of the entire staff of the Budget and Finance Department. I would like to express appreciation to all members of the department who assisted and contributed to the preparation of this report. Credit also must be given to the Mayor, Council, and City Manager for their unfailing support in maintaining the highest standards of professionalism in the management of the City’s finances. Respectfully submitted, Lisette Camacho, CPA Budget and Finance Director 4 Government Finance Officers Association Certificate of Achievement for Excellence in Financial Reporting Presented to City of Glendale Arizona For its Comprehensive Annual Financial Report For the Fiscal Year Ended June 30, 2020 Executive Director/CEO 5 Glendale, Arizona & Neighboring Communities To Flagstaff Cave Creek e fre re Ca 17 Scottsdale 60 Phoenix Glendale 51 El Mirage Peoria Sun City Surprise 303 Luke AFB Fountain Hills Paradise Valley 101 101 10 Goodyear 85 202 Sky Harbor Airport Mesa 89 60 Tempe Chandler 10 To Tucson 6 Gilbert GLENDALE CITY OFFICIALS Jerry P. Weiers Mayor Ian Hugh Vice Mayor Cactus District Jamie Aldama Councilmember Ocotillo District Bart Turner Councilmember Barrel District Lauren Tolmachoff Councilmember Cholla District Joyce Clark Councilmember Yucca District Ray Malnar Councilmember Sahuaro District 7 Kevin Phelps City Manager Glendale Council District Boundaries Pinnacle Peak Rd. Deer Valley Rd. Cholla Beardsley Rd. Union Hills Dr. Bell Rd. Sahuaro Greenway Rd. Thunderbird Rd. Cactus Rd. Peoria Ave. Olive Ave. Barrel Cactus Yucca Yucca Northern Ave. Glendale Ave. Ocotillo Bethany Home Rd. 43rd Ave. 51st Ave. 59th Ave. 67th Ave. 75th Ave. 83rd Ave. 91st Ave. 99th Ave. 107th Ave. 115th Ave. El Mirage Rd. Dysart Rd. Litchfield Rd. Bullard Ave. Reems Rd. e. Av 88 nd ra G Sarival Ave. Camelback Rd. CITIZENS OF GLENDALE City Council Audit Committee City Attorney Michael D. Bailey Boards & Commissions Deputy City Manager Rick St. John Fire Department Terry Garrison Fire Chief Police Department Chris Briggs Police Chief City Manager Kevin R. Phelps Deputy City Manager Brent Stoddard Public Affairs Assistant City Manager Jack Friedline Presiding City Judge Nicholas DiPiazza City Clerk Julie Bower Office of Economic Development Brian Friedman Director Department of Organizational Performance Khala Stanfield Director Arts Performance Management & Data Analytics Assistant City Manager Vicki Rios Special Projects Audit Program Manager Michael Kingery Code Compliance Development Services Department Jamsheed Mehta Director Water Services Department Craig Johnson Director Field Operations Department Michelle Woytenko Director Transportation Department Trevor Ebersole Director Engineering Department Vacant Building Safety Environmental Resources Facilities Management Airport Design Water Field Operations Fleet Management Street Maintenance Construction Water Plant Operations Landfill Traffic Engineering Inspection Solid Waste Transit Administration Planning Community Services Department Jean Moreno Director Human Resources Department Jim Brown Director Innovation and Technology Department Feroz Merchhiya Director Public Facilities, Recreation & Special Events Department Jim Burke Director Budget and Finance Department Lisette Camacho Director Human Services Human Resources Information Technology Civic Center Budget Volunteer Services Risk Management Convention and Visitor’s Bureau/ Tourism Finance Parks and Recreation Procurement Library Special Events Land Development COMMUNITY INTEGRITY EXCELLENCE INNOVATION LEARNING 9 We improve the lives of the people we serve every day. This page left blank intentionally. City of Glendale, Arizona ANNUAL COMPREHENSIVE FINANCIAL REPORT _________________________________________________________ FINANCIAL SECTION ___________________________ FOR THE FISCAL YEAR ENDED JUNE 30, 2021 This page left blank intentionally. CliftonLarsonAllen LLP CLAconnect.com INDEPENDENT AUDITORS’ REPORT The Honorable Mayor and Members of City Council City of Glendale, Arizona Glendale, Arizona Report on the Financial Statements We have audited the accompanying financial statements of the governmental activities, the businesstype activities, each major fund, and the aggregate remaining fund information of the City of Glendale, Arizona (City), as of and for the year ended June 30, 2021, 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 City’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 City’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. CLA is an independent member of Nexia International, a leading, global network of independent accounting and consulting firms. See nexia.com/member-firm-disclaimer for details. 10 The Honorable Mayor and Members of City Council City of Glendale, Arizona 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 Glendale, Arizona as of June 30, 2021, and the respective changes in financial position and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. 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 for the City’s pension plans, other postemployment benefits, and budgetary comparison schedules for the general fund and major special revenue funds (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. Supplementary and Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The combining statements and schedules, supplementary information, and the introductory and statistical sections are presented for purposes of additional analysis and are not a required part of the basic financial statements. The combining statements and schedules and the supplementary information (the federal financial data schedules) are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated, in all material respects, in relation to the basic financial statements as a whole. The introductory and statistical sections have not been subjected to the auditing procedures applied in the audit of the basic financial statements, and accordingly, we do not express an opinion or provide any assurance on it. 11 The Honorable Mayor and Members of City Council City of Glendale, Arizona Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated December 21, 2021, on our consideration of the City’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s 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’s internal control over financial reporting and compliance. CliftonLarsonAllen LLP Phoenix, Arizona December 21, 2021 12 This page left blank intentionally. City of Glendale, Arizona ANNUAL COMPREHENSIVE FINANCIAL REPORT _________________________________________________________ MANAGEMENT’S DISCUSSION & ANALYSIS (Required Supplementary Information) ___________________________ FOR THE FISCAL YEAR ENDED JUNE 30, 2021 This page left blank intentionally. CITY OF GLENDALE, ARIZONA Management’s Discussion and Analysis (MD&A) For the Fiscal Year Ended June 30, 2021 (amounts expressed in thousands) Management’s Discussion and Analysis The following discussion and analysis is provided to readers of the City’s financial statements as a narrative overview of the financial activities of the City for the fiscal year ended June 30, 2021. This discussion and analysis is designed to assist the reader in focusing on significant financial highlights; provide an overview of the City’s financial activity; identify changes in the City’s financial position; identify material deviations from the financial plan (the approved annual budget); and identify individual fund issues or concerns. The Management’s Discussion and Analysis (MD&A) has a different focus and purpose than the letter of transmittal presented on pages 1-4. It is designed to be read in conjunction with the transmittal letter, the financial statements beginning on page 25, and the accompanying notes to the financial statements. Significant Financial Highlights The financial statements illustrate the following significant financial highlights for FY 2020-21: • The City’s total net position increased by $113,010 or 13.0%. The governmental net position increased by $67,573 or 15.3%, and the business-type net position increased by $45,437 or 10.6%. • The City’s total revenues increased by $48,203 or 8.7%. Program revenues in the form of charges for services, grants, and contributions increased by $12,700 or 5.1%. General revenues increased by $35,503 or 11.7%. • Program revenues from governmental activities decreased $2,416 or 2.2%. Program revenues for business-type activities increased $15,116 or 10.9%. • Operating grants and contributions from governmental activities increased $6,904 or 13.5%. The primary reason for this increase was an increase of $8,894 in operating grants and contributions from the AZCares funding the City recognized in revenue to help offset the economic impacts of COVID-19. • Capital grants and contributions from governmental activities decreased $15,458 or 46.0%. Non-recurring revenues were received in fiscal year 2020 including $4,153 of gain on assets sold for the Bank of America Building and the Hickman Properties, $8,994 in FAA grant reimbursement and $1,451 in ADOT grant reimbursement for the airport land purchase. • General revenues from governmental activities increased $27,902 or 9.8%. The primary reason for this increase was an increase of $24,483 or 13.5% in sales tax revenues. In addition, state shared income tax increased $3,650 or 11.3% and state shared sales tax increased $4,031 or 15.6%. The increase in tax revenue reflects strong consumer spending boosted by federal stimulus programs aiding the economic recovery as well as strong performance in construction sales tax. • The total cost of all City programs increased by $20,612 or 4.4%. The increase in program costs is primarily due to increases in community services of $7,373 and street maintenance of $6,847. • The General Fund, a major governmental fund, collected $285,215 in revenues which is an increase of $31,212 or 12.3% from the prior year. This increase was primarily due to an increase in taxes, licenses & permits, and intergovernmental revenues. The total expenditures of the General Fund were $210,203 which is an increase of $20,233 or 10.7%. The increase in general fund expenditures is primarily due to $8,894 of public safety expenditures transferred from the General Fund to the Other Special Revenue Fund in FY2021 due to AZCares funding received in FY2020. 13 CITY OF GLENDALE, ARIZONA Management’s Discussion and Analysis (MD&A) For the Fiscal Year Ended June 30, 2021 (amounts expressed in thousands) Overview of the Financial Statements This discussion and analysis is intended to serve as an introduction to the City’s basic financial statements. The City’s basic financial statements are comprised of three components: 1) government-wide financial statements 2) fund financial statements, and 3) notes to the financial statements. This report also contains required supplementary information intended to provide additional detail to support the basic financial statements. Government-Wide Financial Statements The Government-Wide Financial Statements are designed to provide readers with a broad overview of the City’s finances, in a manner similar to a private-sector business. The accrual basis of accounting is used for governmentwide financial statements. The Statement of Net Position presented on page 25, provides information on all the City’s assets, deferred outflows of resources, liabilities, and deferred inflows of resources, with the difference reported as net position. Net position is categorized as net investment in capital assets, restricted by an outside party, and unrestricted. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the City is improving or deteriorating. The Statement of Activities found on page 26, presents information that illustrates how the City’s net position changed during the fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods, such as revenues pertaining to uncollected taxes and expenses pertaining to earned but unused compensated absences. Both of the Government-Wide Financial Statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities). The governmental activities of the City include general government, public safety, public works, community services, street maintenance, and interest on long-term debt. The business-type activities of the City include water and sewer services, landfill, solid waste, and housing. Fund Financial Statements The Fund Financial Statements found on page 28, provide more detailed information about the major funds within the City. A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All the funds of the City can be divided into two categories: governmental funds and proprietary funds. Governmental Funds Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements use the modified accrual basis of accounting and focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government’s near-term financing requirements. Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the City’s near-term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities. 14 CITY OF GLENDALE, ARIZONA Management’s Discussion and Analysis (MD&A) For the Fiscal Year Ended June 30, 2021 (amounts expressed in thousands) The City maintains 16 individual governmental funds. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures, and changes in fund balances for the 4 major funds. Data from the other 12 governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these non-major governmental funds is provided in the form of combining statements and schedules. Proprietary Funds The City maintains two different types of proprietary funds. Enterprise funds are used to report the same functions presented as business-type activities in the government-wide financial statements. The City uses enterprise funds to account for its water and sewer, landfill, solid waste, and housing services. Internal service funds are an accounting device used to accumulate and allocate costs internally among the City’s various functions. The City uses internal service funds to account for its fleet, technology, risk management, workers’ compensation and employee benefit activities. Because these services predominantly benefit governmental rather than business-type functions, they have been included within governmental activities in the government-wide financial statements. Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The proprietary fund financial statements provide information for the water and sewer fund, while data from the other three enterprise funds is combined into a single, aggregated presentation. Individual fund data for each of the non-major enterprise funds is provided in the form of combining statements. Conversely, all five internal service funds are combined into a single, aggregated presentation in the proprietary fund financial statements. Individual fund data for the internal service funds is provided in the form of combining statements elsewhere in this report. Notes to the Financial Statements The notes to the financial statements provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. Additional Required Supplementary Information Following the notes to the basic financial statements is Required Supplementary Information (RSI) that further explains and supports the financial information in the financial statements. RSI presents the budgetary comparison schedules for the general fund and major special revenue funds, as well as other required supplementary information related to the City’s pensions and other post-employment benefits. Other The Combining Statements and Individual Fund Statements and Schedules section presents combining statements for non-major governmental funds, non-major enterprise funds, and internal service funds, along with budget to actual comparisons on individual funds. Government-Wide Financial Analysis As noted earlier, net position may serve over time as a useful indicator of a City’s financial position. In the case of the City, assets and deferred outflows of resources exceeded liabilities and deferred inflows of resources by $984,058 as of June 30, 2021. By far the largest portion of the City’s net position reflects its investment in capital assets (e.g., land, buildings, machinery, and equipment) less any related debt used to acquire those assets that is still outstanding. The City uses these capital assets to provide services to citizens. Consequently, these assets are not available for future spending. Although the City’s investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities. 15 CITY OF GLENDALE, ARIZONA Management’s Discussion and Analysis (MD&A) For the Fiscal Year Ended June 30, 2021 (amounts expressed in thousands) The City’s financial position is the product of several financial transactions including the net results of activities, the acquisition and payment of debt, the acquisition and disposal of capital assets, and the depreciation of capital assets. At the end of the current fiscal year, the City is able to report positive balances in the categories of net investment in capital assets and restricted net position. Unrestricted net position for the governmental activities increased by $31,446 or 16.2% over the prior year. The City is addressing the negative unrestricted net position for the governmental activities by holding the line on expenses and decreasing debt service payments as a result of bond refundings in fiscal years 2015, 2016, 2017, 2018 and 2021. The chart below is a comparison of the City’s net position for fiscal years 2021 and 2020: Condensed Statement of Net Position As of June 30, 2021, and 2020 (in thousands) Governmental Activities 2021 2020 Current and other assets Capital Assets: Non-depreciable Depreciable (net) Non-current OPEB assets Equity in joint venture $ 494,221 $ 377,526 T otal Primary Government 2021 2020 Business-T ype Activities 2021 2020 $ 108,414 $ 95,607 $ 602,635 $ 473,133 Total assets 131,110 939,579 1,773 2,826 1,569,509 134,374 955,847 1,656 2,861 1,472,264 116,606 492,304 143 40,587 758,054 89,009 471,814 55 42,534 699,019 247,716 1,431,883 1,916 43,413 2,327,563 223,383 1,427,661 1,711 45,395 2,171,283 Deferred Outflows of Resources 101,784 81,980 12,152 10,229 113,936 92,209 Total liabilities 124,429 1,022,523 1,146,952 85,532 1,002,783 1,088,315 39,426 254,433 293,859 39,504 236,388 275,892 163,855 1,276,956 1,440,811 125,036 1,239,171 1,364,207 Deferred Inflows of Resources 14,913 24,074 1,717 4,163 16,630 28,237 471,198 200,500 (162,270) 465,366 170,205 (193,716) 397,187 37,992 39,451 362,679 33,896 32,618 868,385 238,492 (122,819) 828,045 204,101 (161,098) 474,630 $ 429,193 Current liabilities Noncurrent liabilities Net position: Net investment in capital assets Restricted Unrestricted Total net position $ 509,428 $ 441,855 $ 16 $ 984,058 $ 871,048 CITY OF GLENDALE, ARIZONA Management’s Discussion and Analysis (MD&A) For the Fiscal Year Ended June 30, 2021 (amounts expressed in thousands) The following presents a summary of the changes in net position compared to the prior year: Changes in Net Position As of June 30, 2021, and 2020 (in thousands) Governmental Activities 2021 2020 Revenues: Program revenues: Charges for services Operating grants and contributions Capital grants and contributions T otal program revenues General revenues: Property taxes Sales taxes State shared sales tax Urban revenue sharing (state shared income tax) Auto in-lieu taxes Investment earnings, unrestricted Miscellaneous T otal revenues $ 33,186 57,903 18,112 109,201 $ 27,048 50,999 33,570 111,617 T otal Primary Government 2021 2020 Business-T ype Activities 2021 2020 $ 138,748 11,462 3,211 153,421 $ 121,623 10,866 5,816 138,305 $ 171,934 69,365 21,323 262,622 $ 148,671 61,865 39,386 249,922 26,473 205,325 29,941 25,718 180,842 25,910 - - 26,473 205,325 29,941 25,718 180,842 25,910 36,069 11,976 (464) 3,023 421,544 32,419 10,643 5,931 2,978 396,058 227 25,867 179,515 1,277 17,216 156,798 36,069 11,976 (237) 28,890 601,059 32,419 10,643 7,208 20,194 552,856 Expenses: General government Public safety Public works Community services Street maintenance Interest on long-term debt Water and sewer Landfill Solid Waste Housing Total expenses Excess before transfers 47,850 166,243 30,451 35,751 50,283 22,056 352,634 68,910 45,972 165,030 31,211 28,378 43,436 24,133 338,160 57,898 90,604 11,319 19,310 14,182 135,415 44,100 87,212 10,051 18,351 13,663 129,277 27,521 47,850 166,243 30,451 35,751 50,283 22,056 90,604 11,319 19,310 14,182 488,049 113,010 45,972 165,030 31,211 28,378 43,436 24,133 87,212 10,051 18,351 13,663 467,437 85,419 Transfers in (out) (1,337) (1,326) 1,337 1,326 - - 67,573 441,855 $ 509,428 56,572 385,283 441,855 45,437 429,193 474,630 28,847 400,346 $ 429,193 113,010 871,048 984,058 85,419 785,629 871,048 Increase (decrease) in net position Net position beginning Net position ending $ $ 17 $ $ CITY OF GLENDALE, ARIZONA Management’s Discussion and Analysis (MD&A) For the Fiscal Year Ended June 30, 2021 (amounts expressed in thousands) Changes in Net Position The net position of the governmental activities increased by $67,573 and business-type activities’ net position increased by $45,437. Net Position 509,428 Governmental Activities 441,855 474,630 Business-Type Activities 429,193 380,000 400,000 420,000 2021 440,000 460,000 480,000 500,000 520,000 2020 Revenues and Expenses The chart below shows the performance of the revenues in the governmental activities versus expenses: The City’s total revenues from governmental activities for the fiscal year ended June 30, 2021 increased $25,486 or 6.4%. The increase in revenues is due to $6,904 in operating grants and contributions revenue, an increase of $24,483 in local sales tax, $4,031 in state shared sales tax and $3,650 in shared income tax. The increases to tax revenue reflect 18 CITY OF GLENDALE, ARIZONA Management’s Discussion and Analysis (MD&A) For the Fiscal Year Ended June 30, 2021 (amounts expressed in thousands) the continuing economic growth the City and State of Arizona have experienced over the past several years leading up to the COVID-19 pandemic. The cost of programs and services for governmental activities increased $14,474 or 4.3%. The increase is primarily due to increases in street maintenance of $6,847. Additionally, community services increased by $7,373 due to additional federal funding for community services as a result of the COVID-19 pandemic. The chart below shows the performance of the expenses and revenues in the business-type activities: $120,000 Expenses and Program Revenues Business-Type Activities $100,000 $80,000 $60,000 $40,000 $20,000 $Water and sewer Landfill expenses Solid Waste Housing program revenues The City’s total revenues from business-type activities for the fiscal year ended June 30, 2021 increased $22,717 or 14.5%. This increase is primarily due to an increase of $22,300 of reimbursement of the shared project between the City of Glendale and the City of Peoria to increase the capacity at the Pyramid Peak Water Treatment Plant, the project is paid by the City of Glendale and then invoiced to seek reimbursement on Peoria’s capacity is billed as work is completed. The cost of programs and services from business-type activities for the fiscal year ended June 30, 2021 increased $6,138 or 4.7%. Solid waste expenses increased $959 or 5.2%, water and sewer expenses increased $3,392 or 3.9% and landfill expenses increased $1,268 or 12.6%. The increase in cost of programs and services for business-type activities is mainly contributable to increased maintenance costs. 19 CITY OF GLENDALE, ARIZONA Management’s Discussion and Analysis (MD&A) For the Fiscal Year Ended June 30, 2021 (amounts expressed in thousands) City Revenue Categories REVENUES BY SOURCE FISCAL YEAR 2020-21 Urban revenue sharing (state shared income tax) 6.0% Auto in-lieu taxes 2.0% Miscellaneous 4.7% Charges for services 28.6% State shared sales tax 5.0% Grants and contributions 15.1% Sales taxes 34.2% Property taxes 4.4% The pie chart above shows the different types of revenue the City receives and the proportion of each. The majority (62.8%) of the total revenue the City receives comes from charges for services and local sales tax. The second most significant source is grants and contributions (15.1%). City Expense Categories EXPENSES BY FUNCTION FISCAL YEAR 2020-21 Solid Waste 4.0% Landfill 2.3% Housing 2.9% Water and sewer 18.6% General government 9.8% Public safety 34.1% Interest on longterm debt 4.5% Street maintenance 10.3% Public works 6.2% Community services 7.3% The majority of the City’s expenses (52.7%) are incurred in the public safety and water and sewer categories. Public safety expenses include those related to police and fire protection services provided to the community and are funded by the general fund. Water and sewer expenses are paid by the enterprise fund which is funded primarily through user paid fees for services. 20 CITY OF GLENDALE, ARIZONA Management’s Discussion and Analysis (MD&A) For the Fiscal Year Ended June 30, 2021 (amounts expressed in thousands) Financial Analysis of the City’s Funds As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. Governmental Funds As of the end of the current fiscal year, the City’s governmental funds reported combined ending fund balances of $283,787, an increase of $73,762 or 35.1% in comparison with the prior year. The City implemented Governmental Accounting Standards Board Statement (GASB) 54 during the 2011 fiscal year which impacted the presentation of fund balance components by more accurately classifying the fund balances into five categories: non-spendable, restricted, committed, assigned and unassigned; Note K in the summary of significant accounting policies addresses this in greater detail. In fiscal year 2021 and 2020, $54,511 and $49,146 respectively, of the total fund balance constituted unassigned fund balance. Revenues for governmental functions overall totaled $406,712 in fiscal year 2021, an increase of $30,563 or 8.1% from the previous years’ total of $376,149. The increase is primarily due to an increase of $16,474 or 85.9% in licenses and permits and an increase in taxes and special assessments revenue of $25,217 or 12.2%. These revenues are all indicators of the continued healthy economy experienced by the City and as the country exits the COVID-19 pandemic. Expenditures for governmental functions totaled $354,456 in fiscal year 2021, a decrease of $6,397 or 1.8% from the previous year total of $360,853. The decrease is primarily due to a decrease in debt service payments of $27,507 or 30.9%, which is offset by an increase in community services expenditures of $6,998 or 29.8% and an increase in street maintenance expenditures of $6,617 or 20.8% from the prior fiscal year. The decrease in debt service payments is due to paying the outstanding principal balance on the Series 2009 General Obligation bonds to avoid future interest expenditures during FY2020. The General Fund is the main operating fund of the City. The General Fund balance increased $42,558 or 44.8%. At the end of the current fiscal year, the unassigned fund balance of the General Fund was $54,511 while total fund balance was $137,523. The General Fund has $6,143 of its fund balance as non-spendable; $10,047 as restricted; and $66,822 assigned. Per the City’s adopted financial policies, 10% of the general fund operating revenue which totals $28,522 has been earmarked as the Budget Stabilization Reserve and $25,989 has been earmarked as the Operating Reserve. Consistent with the requirements of GASB Statement No. 54, formal Council action was not taken prior to June 30, 2021 to commit these funds; therefore, the funds are reported as unassigned. Overall, the General Fund’s performance resulted in revenues over expenditures of $75,012 in fiscal year 2021. In the prior year, revenues exceeded expenditures by $64,033. This increase in fund balance is due to $8,894 of expenditures being transferred in public safety salaries from the General Fund to the Other Special Revenue Fund to record AZCares funding the City received for COVID related public safety expenditures that were not previously budgeted. In addition, revenues increased by $31,214 over the prior fiscal year. The increase is primarily due to an increase in taxes and special assessment revenue of $20,283 or 13.0%, an increase of $6,252 or 45.1% in licenses and permits, and an increase in intergovernmental revenue of $9,318 or 13.4%. These revenues are all indicators of the continued healthy economy experienced by the City and as the country exits the COVID-19 pandemic. The Transportation Special Revenue Fund is used to account for the accumulation of resources for, and the payment of, the City’s public transit program and transportation improvement project costs. The fund had a balance of $74,519 at the end of the fiscal year, an increase of $11,165 from the previous fiscal year. The increase in fund balance was primarily due to the increase in taxes and special assessment revenue of $4,340 or 14.0% and a decrease in the street maintenance and capital outlay expenditures of $1,170 or 7.9%. 21 CITY OF GLENDALE, ARIZONA Management’s Discussion and Analysis (MD&A) For the Fiscal Year Ended June 30, 2021 (amounts expressed in thousands) The Other Special Revenue Fund accounts for various activities, including the airport, miscellaneous grants, ARPA and other recreational programs. This fund was in the Non-Major Governmental Funds during the previous fiscal year. The fund had a balance of $5,573 at the end of the fiscal year. The Municipal Property Corporation (MPC) debt service fund was established to account for the debt service payments on the bonds that were issued to finance the construction of a new municipal office complex, hockey arena, public safety training center, parking garage, media center, and convention center. The fund had a balance of $3,808 at the end of the fiscal year an increase of $951 from the previous fiscal year. The increase was primarily due to the decrease in debt service principal and interest payment of $2,106 and a decrease in Transfers In of $1,306. Other Non-Major Governmental Funds had a balance increased $18,602 to $62,364 at the end of the fiscal year. This is primarily due to long term debt issuance of $13,700 in the Capital Projects Funds. Proprietary Funds Net position of the enterprise funds increased $44,964 or 10.5%. The enterprise funds’ total net position was $37,992 restricted, $38,782 unrestricted, and $397,187 invested in capital assets. The water and sewer fund accounts for operations, maintenance and construction projects of city-owned water and sewer systems. The fund saw an increase in net position of $42,237 or 10.2% for the fiscal year ended June 30, 2021. The internal service funds account for fleet, technology, risk management, workers’ compensation, and employee benefits provided to other departments. The funds saw an increase in fund balance of $3,834 for the fiscal year ended June 30, 2021. The City’s policy is to fund the worker’s compensation and risk management funds at a 55% confidence level based on the most recent actuarial valuations. General Fund Budgetary Highlights • The City’s budgeted revenues exceeded expectations and were $30,216 higher than the final budgeted amounts. Positive economic trends resulted in taxes and licenses and permits that were $23,722 and $7,749 greater than the final budget, respectively. Charges for services were $3,235 lower than the final budget. Miscellaneous revenues were $854 lower than the final budget. • General Fund expenditures were lower than the final budget by $36,719. The most significant budget variances were in public safety which was $13,088 lower than the final budgeted amount due to $8,894 of expenditures being transferred in public safety salaries from the General Fund to the Other Special Revenue Fund to record AZCares funding the City received to fund COVID related public safety expenditures that were not previously budgeted and in capital outlay which was $19,091 lower than the budgeted amount due to capital project expenditures that did not occur during the fiscal year. • General Fund budgetary fund balance increased by $39,851 or 46.1%. This increase is due to tax revenues, licenses and permits, and intergovernmental revenues. This increase is also related to expenditures being lower than expected, mainly in the public safety and capital outlay categories. Capital Asset and Debt Administration Capital Assets The City’s investment in capital assets (net of accumulated depreciation) as of June 30, 2021, for its governmentaltype activities was $1,070,689 and for the business-type activities was $608,910. The investment in governmental and business-type capital assets consisted of land, buildings, machinery and equipment, and infrastructure for streets, parks, airport and street lighting, water, and wastewater treatment plants. 22 CITY OF GLENDALE, ARIZONA Management’s Discussion and Analysis (MD&A) For the Fiscal Year Ended June 30, 2021 (amounts expressed in thousands) Major capital asset projects capitalized during the current fiscal year included the following: • • • • • • Arrowhead WRF Improvements $16,997 Glendale Ave Loop 101 to El Mirage Reconstruction $5,795 West Area WRF Improvements – Fine Screens $4,866 Cardinals Way Construction, 83rd Ave to 91st Ave $3,790 Camelback Rd Loop 101 to 91st Ave Reconstruction $3,011 O’Neil Park Splash Pad $1,136 The following table is a summary of capital assets reflected in the June 30, 2021 financial statements as compared to last year’s financial statements. Capital Assets at Year End (Net of depreciation) (in thousands) Governmental Activities 2021 2020 Construction in progress $ 11,481 $ 13,951 Land 116,990 117,784 Water storage rights Artwork 2,639 2,639 Buildings 219,575 227,650 Improvements other than buildings 102,479 112,045 Infrastructure-streets 478,252 472,390 Infrastructure-parks 38,391 39,737 Infrastructure-flood/storm drains 65,060 65,793 Infrastructure-airport 9,407 9,885 Water lines Sewer lines Water treatment plant Sewer treatment plant Meters and services Fire hydrants Machinery and equipment 6,687 8,593 Computer equipment 241 393 System Purchase Software 2,359 2,467 Automotive equipment 17,128 16,894 T otal $ 1,070,689 $ 1,090,221 Business-T ype Activities 2021 2020 $ 99,466 $ 72,939 17,140 16,070 6,508 6,687 5,476 5,835 45,702 48,201 92,720 91,233 80,041 75,711 131,338 137,953 94,585 75,931 18,611 16,288 3,050 2,418 1,760 1,574 641 300 111 82 11,761 9,601 $ 608,910 $ 560,823 T otal Primary Government 2021 2020 $ 110,947 $ 86,890 134,130 133,854 6,508 6,687 2,639 2,639 225,051 233,485 148,181 160,246 478,252 472,390 38,391 39,737 65,060 65,793 9,407 9,885 92,720 91,233 80,041 75,711 131,338 137,953 94,585 75,931 18,611 16,288 3,050 2,418 8,447 10,167 882 693 111 82 2,359 2,467 28,889 26,495 $ 1,679,599 $ 1,651,044 The construction commitments at June 30, 2021 were $12,984. Additional information on capital assets can be found in Note V of the financial statements. Long-Term Debt At the end of the current fiscal year, the City had total debt outstanding of $696,825 compared to $718,445 last year, a 3.00% net decrease. General obligation T ransportation revenue bond Excise tax revenue bonds Municipal Property revenue bonds Settlement obligation Water and sewer revenue bonds/obligations T otal $ Governmental Activities 2021 2020 98,230 $ 100,445 58,655 62,570 187,140 197,955 184,850 - $ 528,875 $ Business-T ype Activities 2021 2020 $ $ - 190,225 - - - 551,195 167,950 $ 167,950 167,250 $ 167,250 23 $ T otal Primary Government 2021 2020 98,230 $ 100,445 58,655 62,570 187,140 197,955 184,850 - $ 167,950 696,825 190,225 - $ 167,250 718,445 CITY OF GLENDALE, ARIZONA Management’s Discussion and Analysis (MD&A) For the Fiscal Year Ended June 30, 2021 (amounts expressed in thousands) The City received a “AA-” underlying rating from Standard & Poor’s, an “A1” underlying rating from Moody’s Investor Services, and an “AAA” underlying rating from Fitch Ratings for its general obligation debt. The senior excise tax bonds are rated “AA” by Standard and Poor’s and an “A1” by Moody’s. The subordinate excise tax bonds are rated “AA” by Standard and Poor’s and an “A1” by Moody’s. The subordinate lien water and sewer revenue bonds are rated “A1” by Moody’s and “AA-” by Standard & Poor’s. Transportation bonds were assigned an underlying rating of “AA” by Standard & Poor’s and “A2” by Moody’s. The Arizona Constitution provides that the general obligation bonded indebtedness for a city for general municipal purposes, libraries, economic development, historic preservation, and cultural facilities may not exceed 6% of the total limited property value of the taxable property in that city. Cities may also issue general obligation bonds up to 20% of the total limited property value for supplying water, sewer, artificial light, public safety, law enforcement, fire and emergency services, streets and transportation facilities, and for the acquisition and development of land for open space preserves, parks, playgrounds and recreational facilities. The City’s current unused 6% and 20% debt limitation on June 30, 2021, were $135,186 and $383,417, respectively. Additional information on long-term debt can be found in Note X of the financial statements. Next Year’s Budget and Economic Factors The City of Glendale is continuing its efforts to make sound financial decisions that focus on prudent long-range planning in order to maintain adequate levels of fund balance to mitigate current and future risks and to ensure stable tax rates. The overall goals underlying the city’s financial policies include fiscal responsibility, flexibility, and adherence to the highest accounting and management practices. The adopted fiscal year 2021-22 budget is $1,244,000 an increase of 66.53% from 2020-21. The increase is mainly attributable to an increase in debt service payments and Public Safety Personnel Retirement contribution costs. Overall, the goal of the FY21-22 budget is to continue to improve the city’s financial position while maintaining a high quality of service delivery, improving public safety, encouraging development, maintaining neighborhoods and continuing progress toward the development of a strategic plan to ensure service delivery and resource allocation is aligned with City Council policy throughout the entire organization. Total revenues for fiscal year 2021-22 are projected at $742,369. The major sources of revenue for the City continue to be sales tax, property taxes, and state shared revenues with projected revenues of $129,668, $6,088, and $93,607 respectively. For fiscal year 2021-22, City sales tax is expected to increase by 14.13% due to the COVID-19 pandemic. This expectation is based on the continued expansion of Glendale’s sports, entertainment, office and retail destination area, continued attraction of diverse job growth industries to the city, and modest but sustainable economic recovery. Request for information This financial report is designed to provide a general overview of the City’s finances for all those with an interest in the City’s finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to the Director of Budget & Finance, 5850 West Glendale Avenue, Suite 302, Glendale, Arizona 85301. 24 City of Glendale, Arizona ANNUAL COMPREHENSIVE FINANCIAL REPORT _________________________________________________________ BASIC FINANCIAL STATEMENTS ___________________________ FOR THE FISCAL YEAR ENDED JUNE 30, 2021 This page left blank intentionally. City of Glendale, Arizona Statement of Net Position June 30, 2021 (amounts expressed in thousands) Governmental Activities ASSETS Equity in pooled cash and investments Receivables (net of allowance for uncollectibles) Property taxes Accounts Note Accrued interest Intergovernmental Internal balances Inventories and prepaid items Restricted deposits Restricted cash and investments Non-depreciable Depreciable (net) Non current OPEB assets Equity in joint venture Total assets $ DEFERRED OUTFLOW OF RESOURCES Debit amounts related to pensions and OPEB Debit amounts resulting from refunded debt Total deferred outflow of resources LIABILITIES Vouchers payable Accounts payable Retainage payable Matured bonds payable Accrued interest payable Intergovernmental payable Deposits payable Unearned Revenue Noncurrent liabilities: Due within one year Due in more than one year Total liabilities DEFERRED INFLOW OF RESOURCES Credit amounts related to pensions and OPEB Total deferred inflow of resources NET POSITION Net investment in capital assets Restricted for: Capital Projects Debt Service Transportation Highway and streets Revenue bond retirement, replacement,and extension Perpetual care - nonexpendable Police and fire OPEB benefits Other purposes Unrestricted Total net position $ The notes to financial statements are an integral part of this statement. 25 355,970 Primary Government Business-type Activities $ 28,159 Total $ 384,129 1,153 12,590 48,166 555 33,476 (558) 6,364 1,575 34,930 131,110 939,579 1,773 2,826 1,569,509 23,860 7,938 558 4,701 5,348 37,850 116,606 492,304 143 40,587 758,054 1,153 36,450 48,166 555 41,414 11,065 6,923 72,780 247,716 1,431,883 1,916 43,413 2,327,563 89,501 12,283 101,784 7,019 5,133 12,152 96,520 17,416 113,936 25,554 315 831 36,020 12,801 447 3,506 44,955 8,161 3,037 16,585 3,638 447 7,288 270 33,715 315 3,868 52,605 16,439 894 10,794 45,225 76,300 946,223 1,146,952 22,424 232,009 293,859 98,724 1,178,232 1,440,811 14,913 14,913 1,717 1,717 16,630 16,630 471,198 397,187 868,385 33,867 55,976 74,526 13,849 6,216 10,047 1,773 4,246 (162,270) 509,428 16,585 10,559 143 10,705 39,451 474,630 33,867 72,561 74,526 13,849 10,559 6,216 10,047 1,916 14,951 (122,819) 984,058 $ $ City of Glendale, Arizona Statement of Activities For the Year Ended June 30, 2021 (amounts expressed in thousands) Program Revenues Functions/Programs Expenses Primary government: Governmental activities: General Government Public Safety Public works Community Services Street Maintenance Interest on long term debt Total governmental activities Business-type activities: Water and sewer Landfill Solid Waste Housing Total business-type activities Total primary government $ $ 47,850 166,243 30,451 35,751 50,283 22,056 352,634 90,604 11,319 19,310 14,182 135,415 488,049 Charges for Services Operating Grants and Contributions Capital Grants and Contributions $ $ $ $ 23,415 3,860 3,969 1,909 33 33,186 103,533 12,238 19,854 3,123 138,748 171,934 General revenues: Property tax for general purposes Property tax for debt service Sales taxes State shared sales tax Urban revenue sharing (state shared income tax) Auto in-lieu taxes Investment earnings unrestricted Miscellaneous Transfers Total general revenues, special items, and transfers Change in net position Net position - beginning Net position - ending The notes to financial statements are an integral part of this statement. 26 $ 1,880 15,648 72 12,733 27,570 57,903 287 221 10,954 11,462 69,365 $ 8,616 48 718 8,730 18,112 3,156 55 3,211 21,323 Net (Expense) Revenue and Changes in Net Position Primary Government Governmental Activities $ $ (13,939) (146,735) (26,362) (20,391) (13,950) (22,056) (243,433) Business-type Activities $ Total - $ (13,939) (146,735) (26,362) (20,391) (13,950) (22,056) (243,433) (243,433) 16,372 919 765 (50) 18,006 18,006 16,372 919 765 (50) 18,006 (225,427) 5,896 20,577 205,325 29,941 36,069 11,976 (464) 3,023 (1,337) 311,006 67,573 441,855 509,428 227 25,867 1,337 27,431 45,437 429,193 474,630 5,896 20,577 205,325 29,941 36,069 11,976 (237) 28,890 338,437 113,010 871,048 984,058 $ $ 27 City of Glendale, Arizona Balance Sheet Governmental Funds June 30, 2021 (amounts expressed in thousands) Major Funds ASSETS Equity in pooled cash and investments Receivables, net of allwance for doubtful accounts Property tax Accounts Note Accrued interest Due from other funds Intergovernmental receivable Inventories and prepaid items Restricted cash and investments Total assets General $ LIABILITIES Vouchers payable Accounts payable Retainage payable Compensated Absences - current Intergovernmental payable Due to other funds Deposits Unearned revenue Matured interest payable Matured bonds payable Total liabilities DEFERRED INFLOWS OF RESOURCES Deferred Inflows of Resources-Unavailable Revenue 118,405 Transportation Special Revenue $ Other Special Revenue 73,862 $ 42,003 Municipal Property Corporation Debt Service Other Non-Major Governmental Funds Total Governmental Funds $ $ $ 3,807 82,208 320,285 364 6,739 555 1,576 27,255 6,143 70 161,107 3 2,133 145 76,143 396 1,282 1,960 45,641 48,166 10,111 62,084 789 5,149 2,797 22,789 113,732 1,153 12,287 48,166 555 1,576 33,467 6,288 34,930 458,707 12,139 205 120 1,511 446 3,438 3,974 21,833 1,571 31 15 1,617 2,284 29 1 1,116 68 36,294 39,792 4,735 5,375 10,110 6,200 52 711 26 349 4,672 8,066 30,645 50,721 22,194 257 831 1,597 447 1,465 3,506 44,955 12,801 36,020 124,073 1,751 7 276 48,166 647 50,847 6,143 10,047 66,822 54,511 137,523 145 74,374 74,519 2,640 1,974 959 5,573 3,808 3,808 6,099 56,265 62,364 12,387 147,134 1,974 67,781 54,511 283,787 FUND BALANCES Fund balance: Nonspendable Restricted Committed Assigned Unassigned Total fund balances Total liabilities, deferred inflows of resources and fund balances $ 161,107 $ 76,143 The notes to financial statements are an integral part of this statement. 28 $ 45,641 $ 62,084 $ 113,732 $ 458,707 City of Glendale, Arizona Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position June 30, 2021 (amounts expressed in thousands) Amounts reported for governmental activities in the statement of net position are different because: Fund balances - total governmental funds balance sheet $ Capital assets used in governmental activities are not financial resources and, therefore, are not reported in the funds. Governmental capital assets Less accumulated depreciation $ 1,977,819 (911,905) 283,787 1,065,914 Net OPEB asset 1,743 Adjustment to reflect the government joint venture 2,826 Deferred outflow of resouces related to pensions and OPEB 87,426 Deferred outflow reacquisition price of refunding outstanding debt 12,283 Adjustment to reflect the consolidation of internal service fund activities related to enterprise funds and shown as an internal balance item. (669) Internal service funds are used by management to charge the costs of workers' compensation, risk management, employee benefits, fleet services and IT projects to individual funds. The assets, deferred outflows of resources, liabilities, and deferred inflows of resources of the internal service funds are included in governmental activities in the statement of net position. Long-term liabilities, including bonds payable are not due and payable in the current period and, therefore, are not reported in the funds. Bonds payable Net pension & OPEB liabilities Developer payable obligations Compensated absences Bond discount Unamortized premium on debt issuance 17,341 (528,875) (389,566) (4,893) (28,729) 426 (46,159) (997,796) Deferred inflows of resources related pensions and OPEB (14,274) Deferred inflows of resources is unavailable revenue that is measurable but not yet available for governmental fund activities is recognized as revenue for governmental-wide activities 50,847 Net position of governmental activities $ 29 509,428 City of Glendale, Arizona Statement of Revenues, Expenditures and Changes in Fund Balances Governmental Funds For the Year Ended June 30, 2021 (amounts expressed in thousands) Major Funds REVENUES Taxes and special assessments Licenses and permits Intergovernmental Local Charges for services Fines and forfeitures Investment Income(Loss) Miscellaneous Total revenues General $ 176,183 20,113 78,606 90 6,054 2,389 (1,339) 3,119 285,215 Transportation Special Revenue $ 35,329 3,962 765 656 3 40,715 Municipal Property Corporation Debt Service Other Special Revenue $ 9 18,822 94 685 348 59 176 20,193 $ 934 2 936 Other Non-Major Governmental Funds Total Governmental Funds $ $ 20,520 15,534 22,287 45 242 1,025 59,653 232,032 35,656 124,611 184 7,504 2,782 (380) 4,323 406,712 EXPENDITURES Current: General Government Public Safety Public Works Community Services Street Maintenance Debt service: Principal Interest Capital outlay Total expenditures Excess (deficiency) of revenues over expenditures 28,354 137,516 13,501 19,485 4,292 12,227 811 12,749 1,791 6,262 353 10 - 119 1,006 6 4,765 21,517 29,294 151,271 15,298 30,512 38,389 7,055 210,203 75,012 1,323 13,550 27,165 469 22,435 (2,242) 5,375 9,469 14,854 (13,918) 30,645 16,135 19,221 93,414 (33,761) 36,020 25,604 28,068 354,456 52,256 Long term debt issued Premium on long term debt issued Proceeds from equipment disposal Proceeds from land sale Transfer in Transfer out Total other financing sources (uses) 297 6,500 (39,251) (32,454) (16,000) (16,000) 54 2,674 2,728 14,869 14,869 13,700 2,277 15 36,504 (133) 52,363 13,700 2,277 366 6,500 54,047 (55,384) 21,506 Net change in fund balances Fund balances - beginning Fund balances - ending 42,558 94,965 137,523 11,165 63,354 74,519 486 5,087 5,573 951 2,857 3,808 18,602 43,762 62,364 73,762 210,025 283,787 OTHER FINANCING SOURCES (USES) $ $ The notes to financial statements are an integral part of this statement. 30 $ $ $ $ City of Glendale, Arizona Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities For the Fiscal Year Ended June 30, 2021 (amounts expressed in thousands) Amounts for governmental activities in the statement of net position are different because: Net change in fund balances - total governmental funds $ 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 as depreciation expense. Expenditures for capitalized assets Less current year depreciation $ 73,762 28,068 (52,364) (24,296) The net effect of various transactions involving capital is to increase net position. Capital contributions Gain (loss) on disposals 6,193 (1,886) 4,307 Revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the governmental funds. The net effect of long-term obligations and the related transactions is to increase net assets. Long-term debt issued Amortization of bond premium Bond premium on bond issuance Principal paid on bonds, notes, and leases 523 (13,700) 4,915 (2,277) 36,020 24,958 Compensated absences 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. (666) Governmental funds report pension/OPEB contributions as expenditures. However, in the Statement of Activities, pension/OPEB service costs, interest on the pension liability, current year benefit changes, member contributions, expected earnings on plan investments, administrative expenses and recognition of deferred outflows and inflows from pension and OPEB is reported as pension/OPEB expense. (12,057) Internal service funds are used by management to charge the costs of workers' compensation, risk management, employee benefits, fleet services, and technology projects to individual funds. 3,361 Amortization expense on refunded debt on the statement of activities are not accrued on the governmental funds. (1,367) The net effect of interest in the statement of activities that does not provide current financial resources are not reported as revenues in the governmental funds. Interest income on note receivable Bad debt expense 3,029 (3,963) (934) Expenses on the statement of activities differ from governmental funds because of the portion not accrued on the governmental funds. Change in net position of governmental activities (18) $ 31 67,573 City of Glendale, Arizona Statement of Net Position Proprietary Funds June 30, 2021 (amounts expressed in thousands) ASSETS Current assets: Equity in pooled cash and investments Restricted cash and investments Receivables: Accounts Allowance for uncollectibles Intergovernmental Inventories and prepaid items Total current assets Noncurrent assets: Restricted Deposits Restricted cash and investments OPEB assets Capital Assets: Capital Assets Accumulated Depreciation Capital assets, net Equity in joint venture Total noncurrent assets Total assets Business-Type Activities Total Non-Major Funds Water and Sewer $ DEFERRED OUTFLOWS OF RESOURCES Debit amounts resulting from refunded debt Debit amounts related to pensions and OPEB Total deferred outflows of resources 17,149 27,290 $ 11,010 - Governmental Activities Internal Service Funds Total Enterprise Funds $ 28,159 27,290 $ 35,685 - 23,689 (2,839) 7,731 4,686 77,706 3,617 (607) 207 15 14,242 27,306 (3,446) 7,938 4,701 91,948 303 9 76 36,073 5,348 10,560 93 50 5,348 10,560 143 1,575 30 1,009,466 (435,413) 574,053 40,587 630,641 708,347 75,216 (40,359) 34,857 34,907 49,149 1,084,682 (475,772) 608,910 40,587 665,548 757,496 9,680 (4,905) 4,775 6,380 42,453 5,133 4,581 9,714 2,438 2,438 5,133 7,019 12,152 2,075 2,075 7,417 3,037 1,563 16,585 353 6,295 20,227 3,638 59,115 744 634 270 111 94 993 2,846 8,161 3,037 2,197 270 111 16,585 447 7,288 20,227 3,638 61,961 3,360 58 572 17,595 21,585 1,426 177,007 23,038 201,471 260,586 733 12,964 24 16,817 30,538 33,384 2,159 177,007 36,002 24 16,817 232,009 293,970 586 4,377 4,963 26,548 1,099 618 1,717 639 362,330 34,857 397,187 4,775 16,585 10,559 93 10,705 56,104 456,376 50 (17,322) 17,585 $ 16,585 10,559 143 10,705 38,782 473,961 30 12,536 17,341 $ 669 474,630 LIABILITIES Current liabilities: Vouchers payable Accounts payable Retainage payable Compensated absences Unearned revenue Due to other funds Matured bonds payable Intergovernmental payable Deposits Estimated claims payable Bonds payable current Interest payable Total current liabilities Noncurrent liabilities: Compensated absences Bonds payable Net pension & OPEB liabilities Other long term debt Estimated closure and post closure costs Total noncurrent liabilities Total liabilities DEFERRED INFLOWS OF RESOURCES Credit amounts related to pensions and OPEB NET POSITION Net investment in capital assets Restricted for: Debt service Revenue bond retirement,replacement and extension OPEB benefits Development Impact Fees Unrestricted Total net position $ Adjustment to reflect the consolidation of internal service fund activities related to enterprise funds Net position of business type activities The notes to financial statements are an integral part of this statement. 32 $ $ City of Glendale, Arizona Statement of Revenues, Expenses, and Changes in Net Position Proprietary Funds For the Year Ended June 30, 2021 (amounts expressed in thousands) OPERATING REVENUES Intergovernmental Metered water sales Sewer service charges Container service Curb service landfill user fees Self insurance premium Charges for services Miscellaneous Recycling sales Other fees Total operating revenues Water and Sewer $ OPERATING EXPENSES Water Sewer Landfill Housing Closure/post-closure care adjustment Solid Waste Administrative and general Insurance claims and premiums Amortization and depreciation Total operating expenses Operating income (loss) NONOPERATING REVENUES (EXPENSES) Impact Fees Investment Income Interest expense Net loss from joint venture Gain/(loss) on disposal of assets Total nonoperating revenues (expenses) Income (loss) before contributions and transfers Capital contributions Transfer in Transfer out Change in net position Total net position - beginning Total net position - ending $ 249 60,444 37,882 13 27,240 125,828 Business-Type Activities Total Non-Major Funds $ 11,175 4,668 14,987 11,341 874 3,128 46,173 Total Enterprise Funds Governmental Activities Internal Service Funds $ $ 11,424 60,444 37,882 4,668 14,987 11,341 13 874 30,368 172,001 38,780 21,890 431 61,101 27,493 15,122 16,177 26,371 85,163 40,665 9,026 13,944 797 17,791 3,423 44,981 1,192 27,493 15,122 9,026 13,944 797 17,791 16,177 29,794 130,144 41,857 22,559 34,659 374 57,592 3,509 4,230 160 (5,745) (416) 42 (1,729) 38,936 3,156 415 (270) 42,237 414,139 456,376 70 218 288 1,480 55 1,202 (10) 2,727 14,858 17,585 4,230 230 (5,745) (416) 260 (1,441) 40,416 3,211 1,617 (280) 44,964 336 (11) 325 3,834 3,834 13,507 17,341 Adjustment to reflect the consolidation of internal service fund activities related to proprietary funds Change in net position of business activities $ $ 473 45,437 The notes to financial statements are an integral part of this statement. 33 City of Glendale, Arizona Statement of Cash Flows Proprietary Funds For the Year Ended June 30, 2021 (amounts expressed in thousands) CASH FLOWS FROM OPERATING ACTIVITIES Cash received from customers Cash received from federal operating grants Cash paid to internal city departments Cash paid to external vendors Cash paid for insurance and in settlement of claims Cash paid to employees for services Net cash provided (used) by operating activities $ CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Transfers in Transfers out Advances to/due from other funds Net cash provided (used) by noncapital financing activities Noncash investing, capital and financing activities Contributions of capital assets Loss on joint venture Amortization of deferred amount on refunding Amortization of bond premium/discount Total noncash investing, capital and financing activities 34,584 11,305 (11,289) (19,232) (10,538) 4,830 $ 157,499 11,305 (19,955) (45,987) (32,230) 70,632 $ 60,974 (504) (15,216) (33,363) (6,700) 5,191 1,617 (280) 103 1,440 - 42 (42,270) (69,107) 57,012 4,230 (8,235) (58,328) 218 (5,337) (5,119) 260 (42,270) (74,444) 57,012 4,230 (8,235) (63,447) (11) (614) (625) $ 160 160 7,779 47,220 54,999 $ 70 70 1,076 9,934 11,010 $ 230 230 8,855 57,154 66,009 $ 337 337 4,903 30,782 35,685 $ 40,665 $ 1,192 $ 41,857 $ 3,509 CASH FLOWS FROM INVESTING ACTIVITIES Operating Income Adjustments to reconcile operating income (loss) to net cash provided (used) by operating activities: Amortization and depreciation Changes in assets and liabilities: Accounts receivable Intergovernmental receivable Net OPEB asset Net pension and OPEB liability Deferred outflows related to pensions and OPEB Deferred inflows related to pensions and OPEB Inventories and prepaid items Restricted deposits Joint venture Vouchers and accounts payable Intergovernmental payable Deposits Compensated absences Unearned rent Other long term liabilities Claims payable Estimated closure and post-closure costs Net cash provided (used) by operating activities $ 1,202 (10) 103 1,295 Proceeds from sale of capital assets Principal payments on obligations Acquisition of capital assets and rights Bond issuance Impact fees Interest payments on obligations Net cash provided (used) by capital and related financing activities Reconciliation of operating income (loss) to net cash provided (used) by operating activities: 122,915 (8,666) (26,755) (21,692) 65,802 415 (270) 145 CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Interest received from investments Net cash provided (used) by investing activities Net increase (decrease) in cash and cash equivalents Balances - beginning of year Cash and restricted cash and investment balances - end of the year Governmental Activities Internal Service Funds Business-Type Activities - Enterprise Funds Other Major Funds Proprietary Water and Sewer Total Funds $ $ $ The notes to financial statements are an integral part of this statement. 34 26,371 3,423 29,794 374 1,537 (3,286) (57) 3,302 (1,855) (1,582) (311) (1,531) 1,947 220 (43) 368 57 65,802 (123) 130 (31) 1,779 (1,002) (865) 2 (298) 11 (419) 128 138 (32) 797 4,830 1,414 (3,156) (88) 5,081 (2,857) (2,447) (309) (1,531) 1,947 (78) (32) (51) 185 138 (32) 797 70,632 (122) (19) 1,068 (597) (498) 27 252 144 1,053 5,191 3,156 (416) (934) 2,739 4,545 $ $ $ 55 55 $ $ $ 3,211 (416) (934) 2,739 4,600 $ $ $ - CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) Notes to the Financial Statements The Notes to the Basic Financial Statements include a summary of significant accounting policies and other disclosures considered necessary for a clear understanding of the accompanying financial statements. Index Note Page Summary of Significant Accounting Policies ............................................................................. I ............................. 36 Compliance – Excess of Expenditures Over Appropriations/Deficits in Fund Equity ............. II ............................. 47 Deposits and Investments ........................................................................................................ III ............................. 47 Note Receivable....................................................................................................................... IV ............................. 49 Capital Assets ........................................................................................................................... V ............................. 50 Construction Commitments ..................................................................................................... VI ............................. 52 Internal Service Funds ............................................................................................................VII ............................. 52 Leases ................................................................................................................................... VIII ............................. 55 Short-Term Debt ...................................................................................................................... IX ............................. 55 Long-Term Debt ....................................................................................................................... X ............................. 55 Landfill Obligations................................................................................................................. XI ............................. 64 Inter-fund Transactions...........................................................................................................XII ............................. 65 Encumbrances....................................................................................................................... XIII ............................. 67 Equity in Joint Venture ......................................................................................................... XIV ............................. 67 Jointly Governed Organizations ............................................................................................ XV ............................. 69 Governmental Fund Balance Components and Fund Type Definitions ............................... XVI ............................. 69 Pensions and Other Postemployment Benefits .................................................................... XVII ............................. 71 Contingent Liabilities and Commitments .......................................................................... XVIII ............................. 86 Tax Abatement ..................................................................................................................... XIX ............................. 87 Implementation of New Accounting Principles..................................................................... XX ............................. 88 Subsequent Events ................................................................................................................ XXI ............................. 89 35 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) I. Summary of significant accounting policies A. Reporting entity The City of Glendale, Arizona (City) was incorporated June 18, 1910, under the provisions of Article 13, Sections 1 through 6 of the Constitution of Arizona and Title 9 of the Arizona Revised Statutes. It is governed by a Mayor elected at large, and six district council members. The City operates under a Council-Manager form of government. The major operations of the City include providing police, fire, water, and sewer services to citizens. As required by GAAP, these financial statements present the government and its component units, entities for which the City is considered to be financially accountable. Blended component units, although legally separate entities, are, in substance, part of a government’s operations, so data from these units are combined with data of the primary government. A discretely presented component unit, on the other hand, is reported in a separate column in combined financial statements to emphasize that it is legally separate from the government. The City has no discretely presented component units. Blended component units City of Glendale, Arizona, Municipal Property Corporation (MPC) is a non-profit corporation organized under the laws of the State of Arizona to assist the City in the acquisition and financing of municipal projects and facilities. The MPC is governed by a board of directors who are responsible for approving the corporation’s bond sales. Bond sales must also be approved by the City Council. Although it is legally separate from the City, MPC is reported as if it is part of the primary government because its sole purpose is to finance and construct public facilities for the City. The total debt outstanding, including leases, of the MPC is expected to be repaid entirely or almost entirely with the resources of the primary government. MPC does not issue separate audited financial statements. However, it does file a tax return with the Internal Revenue Service. Copies of the tax return are available from the City’s Budget and Finance Department. B. Government-wide and fund financial statements The government-wide financial statements (i.e., the statement of net position and the statement of activities) report information on all of the 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 to a significant extent on fees and charges for support. There are several types of transactions that are reported in the financial statements as inter-fund items. Transactions that would be treated as revenue, expenditures or expenses if they involved organizations external to the governmental unit, like the sale of water from the water & sewer fund to various functions of the general fund, are accounted for as revenue & expenditures or expenses in the funds involved. These revenue & expense transactions are reflected in the appropriate functional activity on the government-wide statement of activities and are not eliminated in consolidation. Transactions that constitute reimbursement to a fund for expenditures or expenses initially made from that fund, which are properly applicable to another fund, are recorded as expenditures or expenses in the reimbursing fund and as reductions of the expenditure or expense in the fund that is being reimbursed. Governmental Accounting Standards Board (GASB) Statement 34 also requires that administrative service fees charged to other operating funds to support general services used by the other operating funds (like purchasing, accounting & administration) should be treated as reimbursement transactions and the revenue & expenditures/expenses reduced in the allocating fund. The costs of these services are reflected in the appropriate functional activity within the government-wide statement of activities and the revenues & expenses are eliminated from the government-wide financial statements to avoid any doubling up effect of these revenues & expenses. Transfers between funds are included in the results of both governmental & proprietary funds (as other financing sources/uses in governmental funds). 36 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) Activities between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are reported in the fund financial statements as “due to/from other funds.” Certain transactions occurring between funds that are combined within the same fund type or displayed in the same financial statement column for presentation in these annual financial statements have been eliminated from the financial statements. These transactions include transfers between funds and interdepartmental service charges. All internal balances in the statement of net position have been eliminated, with the exception of those representing balances between the governmental activities and the business-type activities, which are presented as internal balances and eliminated in the total governmental column. The statement of activities demonstrates the degree to which the direct expenses of a given function or segment is 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. Taxes and other items not properly included among program revenues are reported instead as general revenues. Separate financial statements are provided for governmental funds and proprietary funds. Major individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements. The internal service funds are eliminated on an entity-wide basis as per GASB Statement 34. C. Form of presentation – fund financial statements The City reports the following major governmental funds: The general fund is the City’s primary operating fund. It accounts for all financial resources of the City, except those required to be accounted for in another fund. The transportation special revenue fund accounts for the City’s public transit system and transportation improvement projects. The other special revenue fund accounts for various activities, including the airport, miscellaneous grants, ARPA funds and other recreation programs. The municipal property corporation debt service fund (MPC) accounts for the debt service payments for the bonds that were issued to finance the construction of a new municipal office complex, hockey arena, public safety training center, parking garage, media center and convention center. The City reports the following major proprietary fund: The water and sewer fund accounts for operations, maintenance and construction projects of the Cityowned water and sewer systems. Additionally, the City reports internal service funds. Internal service funds account for risk management, workers’ compensation, employee benefits, fleet and technology services provided to other departments. 37 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) 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, deferred outflows of resources, liabilities, deferred inflows of resources, fund equity, revenues, and expenditures/expenses, as appropriate. Government resources are allocated to, and accounted for, in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled. The following funds are presented in the accompanying financial statements: Governmental funds Governmental funds are those through which most governmental functions of the City are financed. The acquisition, use and balances of the City’s expendable financial resources and related liabilities (except those accounted for in proprietary funds) are accounted for through governmental funds. The measurement focus is based upon determination of financial position and changes in financial position rather than upon the determination of net income. The following governmental funds are presented in the accompanying financial statements. General fund: The general fund is the general operating fund of the City. It is used to account for all financial resources except those required to be accounted for in another fund. Special revenue funds: Special revenue funds are used to account for the proceeds of specific revenue sources (other than major capital projects) that are legally restricted to expenditures for specified purposes. Debt service funds: Debt service funds are used to account for the accumulation of financial resources for the payment of long-term debt principal, interest, and related costs, except the debt service accounted for in the enterprise funds. Debt service funds also include the debt payable from highway user’s gas tax revenues and unrestricted excise tax revenues as well as debt funded by property taxes levied by the City on property located within the City. Capital projects funds: Capital projects funds are used to account for financial resources to be used for the acquisition or construction of major capital facilities (other than those financed by proprietary funds and trust funds). Permanent fund: Permanent fund is used to account for financial resources to be used by the cemetery fund. Proprietary funds Proprietary funds are used to account for the City’s ongoing operations and activities, which are similar to those found in the private sector. The measurement focus is based upon the determination of net income. Enterprise funds: Enterprise funds are used to account for operations, including debt service, 1) that are financed and operated in a manner similar to private business enterprises where the intent of the governing body is that the costs (including depreciation) of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges, or 2) where the governing body has decided that periodic determination of revenues earned, expenses incurred, and/or net income is appropriate for capital maintenance, public policy, management control, accountability, or other purposes. The enterprise funds, which the City currently maintains, are the water and sewer, landfill, solid waste, and housing funds. Internal service funds: Internal service funds are used to account for the financing of self-insurance and fleet and technology services provided by one City department to other City departments on a costreimbursement basis. 38 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) D. Measurement focus and basis of accounting The City-wide and proprietary fund 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. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met. Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available except as described below in relation to grants. Revenues are considered to be available when they are collected within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the City considers revenues to be available if they are collected within 60 days of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, principal and interest on long-term debt are recorded as fund liabilities when due or when amounts have been accumulated in the related debt service fund for payments to be made shortly after fiscal year-end. Revenues susceptible to accrual because of their availability include property tax, sales tax, highway user’s tax, state shared sales tax, vehicle license tax, and interest earned on investments. Licenses and permits, charges for services, fines and forfeitures, and miscellaneous revenues are recorded as revenues when received in cash because they are generally not measurable until actually received. In applying the susceptible to accrual concept to intergovernmental revenues, the decision to accrue depends on the terms of the arrangement or agreement. Generally, these resources are reflected as revenue at the time of receipt or earlier if they meet the available criterion. Certain grant revenues are recognized based on expenditures recorded. Resources that have been received before time requirements are met but after all other eligibility requirements have been met are recorded as a deferred inflow. However, resources transmitted before time requirements are met but after eligibility requirements have been met are recorded as deferred outflows. This practice is defined and supported by GASB Statement 63, as it pertains to Financial reporting of deferred outflows of resources, deferred inflows of resources and net position. E. Statement of cash flows The City considers short-term investments (including restricted assets) in the State of Arizona Local Government Investment Pool (LGIP), mutual fund-money market, U.S. Treasury bills and notes with original maturities of three months or less at acquisition date to be cash equivalents. F. Inter-fund transactions Inter-fund transactions, consisting of services performed for other funds or costs billed to other funds are treated as expenditures in the fund receiving the services and as a reimbursement reducing expenditures in the fund performing the services, except for sales of water to other City departments, which are recorded as revenue in the Water Enterprise funds. In addition, operating transfers are made between funds to shift resources from a fund legally authorized to receive revenue to a fund authorized to expend the revenue. Activity between funds that is representative of lending/borrowing arrangements outstanding at the end of the fiscal year is classified as due to/from other funds (current portion of inter-fund advances) and advances to/from other funds (noncurrent portion of inter-fund advances). Any residual balances 39 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) outstanding between the governmental activities and business-type activities are reported in the government-wide financial statements as internal balances. G. Inventories and prepaid items Inventories of the governmental and enterprise funds consist primarily of expendable supplies held for consumption. These inventories are maintained on a perpetual system verified through cyclical physical counts and are valued using a weighted average cost. Generally, expenditures are recorded at the time inventories are used (i.e., the consumption method) for both GAAP reporting and budgetary purposes. However, the City postage inventory is recorded as expenditure at time of purchase (i.e., the purchase method) for budgetary purposes. At June 30, 2021, the postage portion of the general fund supplies inventory was $3. Certain expenditures are recorded for financial reporting purposes as prepaid items. Special reporting treatment is applied to governmental fund inventories and prepaid items to indicate that they represent amounts that are not in spendable form, even though they are a component of current assets. Such amounts are presented as a component of non-spendable fund balance. H. Restricted assets Certain proceeds of the City’s bonds, as well as certain resources set aside for their repayment, are classified as restricted on the balance sheet, or statement of net position, because they are maintained in separate bank accounts and their use is limited by applicable debt covenants and the escrow agreement. When both restricted and unrestricted resources are available for use, it is the City’s policy to use restricted resources first, then unrestricted resources, as they are needed. Restricted assets also include cash held at the Maricopa County Treasurer for the Racketeer Influenced and Corrupt Organizations Act (RICO). RICO funds are limited by state and federal law to qualified expenses related to fighting and preventing drug use and organized crime. I. Capital assets The City has chosen not to apply the modified approach to any networks or subsystems of infrastructure assets. No long-term assets or depreciation are shown in the governmental fund financial statements. Capital assets, including public domain infrastructure (e.g., roads, bridges, sidewalks and other assets that are immovable and of value only to the City) are defined as assets with an initial, individual cost of more than $5 and an estimated useful life greater than three years. Capital assets are recorded at cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at acquisition value at the date of donation. The cost of normal maintenance and repairs that do not add to the value of the asset or materially extend the assets’ lives are not capitalized. Major improvements are capitalized and depreciated over the remaining useful lives of the related capital assets. Major outlays for capital assets and improvements are capitalized as projects are constructed. The remainder of this page left blank intentionally. 40 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) Capital assets are depreciated using the straight-line method over the following estimated useful lives: Assets Buildings Improvements other than buildings Infrastructure Machinery and equipment Automotive equipment Software Computer equipment Useful Life (Years) 30 10-20 10-100 5-8 6-8 3 3-5 Capital assets transferred between funds are transferred at their carrying value (cost less accumulated depreciation) as of the date of the transfer. J. Water rights The City has entered into a lease agreement with Salt River Pima-Maricopa Indian Community (SRPMIC) for the rights to 1,814 acre-feet of water each year through 2099. These rights, costing $2,693, are being amortized over 40 years on a straight-line basis starting January 1, 2000. Current year amortization was $66. The net book value of water rights as of June 30, 2021, is $1,245. In addition, the City will be responsible for paying for the cost of water delivered each year. The City participates in the Plan Six cost sharing agreement to construct the Waddell Dam on the Agua Fria River and modify the Roosevelt and Stewart Mountain Dams on the Salt River. The parties to this agreement include the United States government, State of Arizona, Central Arizona Water Conservation District, Salt River Project, and the cities of Phoenix, Chandler, Glendale, Mesa, Scottsdale, Tempe and Tucson. The federal government has determined that this agreement does not constitute a joint venture. As of June 30, 2021, the City has capitalized payment of $4,463 for these water rights. Current year amortization was $113. The net book value of these water rights as of June 30, 2021, is $3,236. The City purchased Central Arizona Project water rights as part of the Salt River Pima-Maricopa Indian Community Water Rights Settlement in November 2007. These rights, as of June 30, 2021, costing $2,027, are a permanent right and are considered to have an indefinite useful life. As such, they are not amortized; therefore, cost and net book value are equal to $2,027. K. Governmental fund balance components The components of governmental fund balance consist of the following: Non-spendable amounts are the portion of net resources that cannot be spent because of their form such as inventories and prepaid items. Also included is the portion of net resources that cannot be spent because they must be maintained intact pursuant to legal and contractual requirements such as the cemetery permanent fund. Restricted are amounts that are subject to externally enforceable legal restrictions imposed by parties outside the government such as creditors, grantors, contributors, and other governments through laws and regulations. Examples of restricted fund balance are amounts held to pay for bonded construction projects, debt service, and excise tax revenues collected for voter approved transportation expenditures. Committed are amounts that are constrained by limitations imposed by the highest level of decision making authority, namely Mayor and Council and require approval by the same level of authority 41 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) through an ordinance to remove. Amounts must be committed prior to the fiscal year end. An example of committed fund balance is amounts for artwork. Assigned are amounts that are constrained by limitations imposed by management based on the intended use of the funds. The city manager has been given authority to assign funds as needed through the financial policies adopted in the annual Budget Book approved by Mayor and Council. An example of assigned fund balance are amounts for equipment replacement or general government capital projects. Unassigned are amounts for any other purpose. If resources were not assigned, they could not be properly reported in a fund other than the general fund. Therefore, only the general fund can report a positive amount of unassigned fund balance. Any governmental fund in a deficit position could report a negative amount of unassigned fund balance. When both restricted and unrestricted resources are available for specific expenditures, restricted resources are considered spent before unrestricted resources. Within unrestricted resources, committed and assigned are considered spent (if available) before unassigned amounts. On the government-wide financial statements, only restrictions imposed by external sources are shown as restricted net position. L. Net position The government-wide and proprietary fund financial statements use a net position presentation. Net position is categorized as net investment in capital assets, restricted, and unrestricted. Net Investment in Capital Assets – This category groups all capital assets, including infrastructure, into one component of net position. Accumulated depreciation and the outstanding balances of debt and other liabilities that are attributable to the acquisition, construction, or improvement of these assets reduce the balance in this category. Restricted Net Position – This category represents net position that has external restrictions imposed by creditors, grantors, contributors, laws or regulations of other governments, and restrictions imposed by law through constitutional provisions or enabling legislation. Unrestricted Net Position – This category represents net position of the City not restricted for any project or other purpose. M. Property tax The City levies taxes on real and personal property located within its boundaries. Property values are assessed by the Maricopa County Tax Assessor. The tax levy is then approved by the State of Arizona Property Tax Oversight Commission. The County Treasurer bills and collects property taxes and remits them to the City monthly. City property tax revenues are recognized when levied to the extent that they are received within the current period, or soon enough thereafter (within 30 days of year-end), to pay liabilities of the current period. Remaining collectible taxes are accrued and reflected as deferred inflows of resources. The remainder of this page left blank intentionally. 42 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) Property Tax Calendar Lien date Levy (assessment) date (third Monday in August) Due dates: First half of assessment Second half of assessment Penalties and interest added (collection dates): First half of assessment Second half of assessment January 2, 2020 August 17, 2020 October 1, 2020 March 1, 2021 November 2, 2020 May 3, 2021 The City currently levies less than the maximum allowed by State Statutes for primary property taxes. The City is permitted to levy an increase of two percent 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 secondary property tax levy is made for the purpose of retiring the principal, interest and servicing fees on bonded indebtedness. The City may levy the amount deemed necessary to meet its bonded debt service requirements. The debt service fund balance cannot exceed 10% of the next year’s debt service payment. Assessed values are established by the Maricopa County Tax Assessor each year on a uniform basis ratio to full cash value of each property class as required by State Statutes. The distribution of the City’s levy (tax rate per $100 assessed value) to its funds for the year ended June 30, 2021, is as follows: Fund General fund General obligation debt service fund Total Rate 0.40 1.40 $ 1.80 $ N. Compensated absences Vacation time is accumulated up to a maximum of 10 workweeks and compensatory time is earned in lieu of cash payment for overtime. Both vacation and compensatory time can either be taken as time off from work, within certain limitations, or may be payable to employees upon termination or retirement. Employees who have ten or more years of service will receive upon retirement 100% of up to 160 hours of vacation accrued. Any remaining vacation time above 160 hours will be 100% contributed to a mandatory Retiree Health Savings plan for the employee. Employees separating from the City receive 100% of accrued vacation time. Sick leave is accumulated without limit and can be used in the event of an illness of the employee or their immediate family. Accumulated sick leave can be converted to a cash benefit on a biannual basis for employees based on one-third of the average hourly rate the last 36 months. Employees must maintain a minimum sick leave balance on the books. Employees who retire and have ten or more years of service will have 50% of their accrued sick time contributed to a mandatory Retiree Health Savings plan based on their average hourly wage over the last 36 months. Employees who separate from service and have five or more years of service will receive one-third of their sick leave balance based on their average hourly wage over the last 36 months in a cash payout. Represented Fire and Police MOU employees who retire and have ten or more years of service will have 50% of their accrued sick time contributed to a mandatory Retiree Health Savings plan based on their average hourly wage over the last 36 months. Represented Fire and Police MOU employees who retire are paid 100% of accrued vacation time. The current portion of the liability for compensated absences recorded in the governmental fund is equal to: 1) vacation and compensatory time taken and paid during the thirty days following the year ended June 30, 2021, and 2) sick leave, taken and paid for illness during that period, paid to terminating 43 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) employees or paid under the optional annual declaration. Long-term liabilities of governmental funds are not shown on the fund financial statements. All of the outstanding vacation, compensatory time, and sick leave are recorded as a liability on the government-wide financial statements, and the proprietary fund financial statements, according to payment policy. O. Deferred outflow and deferred inflow of resources In addition to assets, the statement of net position will report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflow of resources, represents a consumption of net position that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then. The government only has two items that qualify for reporting in this category. It is the deferred charge on refunded debt and deferred outflows related to pensions and OPEB reported in the government-wide statement of net position. In addition to liabilities, the statement of net position will report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time. The government only has two items that qualify for reporting in this category. It is unavailable revenue, which arises only under a modified accrual basis of accounting, and the deferred inflow related to pensions and other post-employment benefits. Amounts that are reported as deferred outflows are shown as a separate balance sheet section following the assets. Similarly, amounts shown as deferred inflows are shown in a separate balance sheet section following liabilities. P. Long-term obligations In the government-wide financial statements, and proprietary fund types in the fund financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities, or proprietary fund type statement of net position. Bond premiums and discounts are reported as a long-term liability and amortized over the life of the bonds using the straight-line method, which approximates the effective interest method. Bonds payable are reported net of the applicable bond premium or discount. In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond issuance costs, during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures. Q. Operating revenues and expenses Proprietary funds distinguish operating revenues and expenses from non-operating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund’s principal ongoing operations. The principal operating revenues of the enterprise funds and the City’s internal service funds are charges to customers for sales and services, or housing operational grants from a federal agency. Housing operational grants provide decent, safe, and affordable housing to eligible, low-income families and individuals by providing a voucher to rent a qualifying unit in the City of Glendale. The water and sewer fund also recognizes as operating revenue the portion of tap fees intended to recover the cost of connecting new customers to the system. Operating expenses for enterprise funds and internal service funds include the cost of sales and services, administrative expenses, and depreciation on capital 44 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) assets. All revenues and expenses not meeting this definition are reported as non-operating revenues and expenses. R. Postemployment benefits For purposes of measuring the net pension and other postemployment benefits (OPEB) assets and liabilities, deferred outflows of resources and deferred inflows of resources related to pensions and OPEB, and pension and OPEB expense, information about the plan’s fiduciary net position and additions to/deductions from the plan’s 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 the benefit terms. Investments are reported at fair value. S. Deferred compensation The Voluntary Deferred Compensation Plan for Employees of the City of Glendale, State of Arizona; Restated Plan Document (the “Plan document”) was adopted by the Mayor and City Council on November 10, 1998, and amended on January 8, 2002 to incorporate the Federal Economic Growth and Tax Relief Reconciliation Act of 2001. In addition, the Mayor and City Council adopted a defined contribution deferred compensation plan document on April 9, 2002, under the Internal Revenue Code Section 401(a). On February 12, 2013 the adoption of a new contract was approved by the Mayor and City Council which allowed the plan to be administered solely by the third-party administrator Empower Retirement (Empower) a division of Great West Life & Annuity Insurance Co (Great West). Through the Plan document, the City offers its employees a deferred compensation plan that permits them to defer a portion of their current salary until future years. Any contributions made to the deferred compensation plan, in compliance with Section 457 and 401(a) of the Internal Revenue Code, are not available to employees until termination of employment, retirement, death or an unforeseen emergency. The plan assets are in custodial or trust accounts for the exclusive benefit of the plans’ participants and beneficiaries. The City provides neither administrative services nor investment advice to the plans; therefore, no fiduciary relationship exists between the City and the deferred compensation pension plan. In addition, the plan assets are not included as a fund of the City. The Retiree Health Savings (RHS) Plan was originally adopted on July 1, 2008, and amended and restated on February 12, 2013, by Mayor and Council. The purpose of the Plan is to provide certain Employees with an opportunity to receive reimbursement for certain Health Care Expenses as provided in this Plan. It is the intention of the Adopting Employer that the benefits payable under this Plan be eligible for exclusion from the gross income of Participants as provided by Sections 105(b) and 106 of the Code. In addition, it is the intention of the Adopting Employer that the Plan qualify as a Health Reimbursement Arrangement (HRA) under IRS Revenue Ruling 202-41 (June 26, 2002) and IRS Notice 2002-45 (June 26, 2002). The provider for this RHS plan is Educator Benefit Consultants (EBC). The contributions to this Plan are detailed in the Compensated Absences (N) section on this document. T. Elected Officials’ Defined Contribution Retirement System (EODCRS) HB 2608 signed in July of 2013 closed the Elected Officials’ Retirement Plan (EORP) to new members and established the new Elected Officials’ Defined Contribution Retirement System (EODCRS) effective January 1, 2014 (A.R.S. Title 38, Chapter 5, Article 3.1). In addition to this new plan, the EODCRS Disability Program was also established (A.R.S. Title 38, Chapter 5, Article 3.2). EODCRS is a nonERISA 401(a) plan type. If a person is elected, appointed, or hired on or after January 1, 2014, does not have money on account with EORP, does not have money on account with ASRS or does not timely opt out of the EODCRS to return to ASRS, if applicable, the elected official must be automatically enrolled 45 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) in the EODCRS. This includes any elected official who has already retired from EORP and/or ASRS. The investment options available to EODCRS members will be administered by Nationwide Retirement Solutions (NRS). The elected official will also contribute to and participate in the EODCRS Disability Program administered by PSPRS. As prescribed in ARS § 38‐727, if a person is appointed, elected, or hired on or after January 1, 2014 and does not have money on account with the EORP, but has money on account with the ASRS, that person has the option to return to the ASRS. The member has the option to participate in either the EODCRS or the ASRS Plan with each term. That decision is irrevocable during the term in which that election was made. Additionally, the elected official will contribute to and participate in the Long‐Term Disability Program administered by ASRS. To choose the ASRS, the person must fill out a form provided by PSPRS opting out of the EODCRS. This election must be made within 30 days after that person’s term begins and returned to PSPRS. The City was required by statute to contribution 49.86 percent of elected officials participating as an ASRS members’ annual covered payroll to the ASRS Legacy As of January 1, 2014, the employer rate for all employers contributing on behalf of their elected officials vary based on the path the employee is eligible for. Pursuant to ARS § 38‐810, subsection C, and as described above, that rate may be split a number of ways depending on which plan (or path) your elected official will belong to. Employee rates will vary, also dependent upon the path your elected official is on, and all are pre‐tax contributions. The rates for the respective disability programs are separate from the 61.43% employer rate and are contributed on an after‐tax basis. The 61.43% employer rate is set by statute; however, the Board of Trustees of PSPRS is required to monitor this rate to inform the Legislature annually of its continued ability to pay the unfunded liability of the EORP legacy costs, so there is the possibility of this rate changing from time‐to‐time. Additionally, the rate for the disability program will also be reviewed and revised annually to meet its actuarially determined costs. For the year ended June 30, 2021 active EODCRS members were required by statue to contribute at the rate of 8.125 percent (8 percent to the DC plan and .125 percent for the disability program) of the members’ annual covered payroll. The City was required by statue to contribute at the rate 6.125 percent (6 percent to the DC plan and .125 percent for the disability program) of the active members’ annual covered payroll. The maximum annual contribution limits are in accordance with the IRS regulation for defined contribution plans. Employee and employer contributions are immediately vested. In addition, the City was required by statute to contribution 55.43 percent of the EODC members’ annual covered payroll to the EORP Legacy. The Elected Officials Retirement Plan is not reported in the financial statements because of its relative insignificance to the financial statements. U. Investments The City uses the following methods and assumptions to account for its investments: 1. 2. 3. Aside from investments clearly identified as belonging to a specific fund, any unrealized gain/loss resulting from the valuation is recognized within the general fund as investment revenue. Investments are recorded at fair value, which is based on quoted market prices as of the valuation date. Pooled investment income is allocated to various funds monthly based on the average equity balances maintained during the month. Arizona Revised Statutes require the City to deposit certain crime-related forfeitures with the County Treasurer. The County Treasurer determines the fair value of those pooled investments. The structure of the pool does not provide for shares and the County has not provided or obtained any legally binding guarantees to support the value of the participants’ investments. The County Treasurer is not subject to custodial credit risk. 46 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) The City’s investment in LGIP represents shares of the pool’s portfolio. The fair value of each share in the LGIP is one dollar. These shares are not identified with specific investments and are not subject to custodial credit risk. Neither the County nor LGIP are registered with the Securities and Exchange Commission as investment companies. The State Board of Deposits provides oversight, and the Local Government Investment Pool Advisory Committee provides consultation and advice to the LGIP. There is no regulatory oversight of the County Treasurer’s operations. The net increase in the fair value of total investments during the fiscal year ended June 30, 2021, was $1,908. II. Compliance - Excess of expenditures over appropriations/deficits in fund equity The City ended the fiscal year June 30, 2021, with a deficit net position of $3,021 in the fleet services internal service fund. This deficit will be funded by increases in user premium charges in the next fiscal year. III. Deposits and investments The City maintains a cash management pool for its cash and cash equivalents in which each fund and/or account or sub-account of a fund participates on a dollar equivalent basis. Deposits At year-end, the carrying amount of the City’s deposits was $168,565 and the bank balances were $169,767. The difference of $1,202 represents deposits in transit, outstanding checks, and other reconciling items. At year-end, with the exception of $242,660 of deposits that were uncollateralized, all of the City's deposits were covered by Federal depository insurance and collateral held in the City’s name. Investments State Statutes and the City’s investment policy authorize the City to invest in obligations of the U.S. Treasury, its agencies and instrumentalities, repurchase agreements, commercial paper (A-1/P-1 rated), interest-earning money market accounts, certificates of deposit, and the State of Arizona Local Government Investment Pool (LGIP). Investments may not exceed five years to maturity from the date of purchase. The City’s investment in the LGIP is valued using net asset value (NAV) per share (or its equivalent), which approximates the fair value of the holdings provided by the Arizona State Treasurer’s Office at June 30, 2021. Unlike more traditional investments, the City’s holdings in the LGIP, measured at a NAV approximately $1 per share (or equivalent) are not individually identifiable. The remainder of this page left blank intentionally. 47 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) As of June 30, 2021, the City had the following investments: Investment Type Corporate Bonds U.S. Agencies U.S. Treasury Arizona LGIP-State Pool Grand total investments Cash deposits Cash with fiscal agents Total deposits and investments Investment Maturities (in years) 1-2 2-3 Over 3 $ 9,972 $ 5,600 $ 8,848 10,695 17,972 14,844 13,075 27,051 $ 33,664 $ 29,370 $ 45,023 0-1 4,629 5,152 74,317 24,886 $ 108,984 $ Fair Value $ 20,201 42,667 129,287 24,886 $ 217,041 168,563 78,228 $ 463,832 Investment Fair Value Level: Investments using fair value measurement guidelines established by generally accepted accounting principles recognize a three-tiered fair value hierarchy as follows: • • • Level 1 – Quoted prices for identical investments in active markets, Level 2 – Observable inputs other than quoted market prices, and Level 3 – Unobservable inputs Debt securities classified in Level 2 are valued using quoted prices for similar securities in active markets. The City’s investments are classified as follows: Fair Value Measurements Using Levels Investment at fair value level Level 1 Corporate Bonds $ U.S. Agencies U.S. Treasury 129,287 Total Investments at fair value level $ 129,287 Level 2 $ 20,201 42,667 $ 62,868 Level 3 $ $ External Investment Pools Measured at Fair Value State Treauser's Investment Pool Total Investments - $ Totals 20,201 42,667 129,287 192,155 24,886 $ 217,041 Interest rate risk: As a means of limiting its exposure to interest rate risk the City’s investment policy requires all securities to mature in no more than five years. The City also purchases securities to be laddered with staggered maturity dates. The remainder of this page left blank intentionally. 48 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) Credit risk: The City’s investment policy requires commercial paper to have a rating of at least A-1 by Standard and Poor’s, P-1 by Moody’s, or F1 by Fitch. Corporate bonds must have a rating of at least A or better by Standard and Poor’s, A2 by Moody’s, or A by Fitch. As of June 30, 2021, the City’s investments were rated by Moody’s Investor Service and Standard & Poor’s as follows: Investment Type U.S. Treasury U.S. Agencies U.S. Treasury Corporate Corporate Corporate Corporate Corporate Corporate S&P Rating AA+ AA+ A-1+ A+ AAAA AA+ AAA AA- Moody's Rating Aaa Aaa P-1 A1 Aa2 Aa2 Aa1 Aaa Aa3 % of Total Investments 57.72% 22.20% 9.56% 2.47% 2.13% 2.01% 1.71% 1.65% 0.53% Weighted Average Maturity (Years) 1.88 2.61 0.38 0.89 1.18 1.35 2.06 2.61 1.59 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 (other than U.S. Treasury securities, mutual funds, and external investment pools) that represent 5% or more of the total investments are as follows: Issuer Investment Type United States Treasury Total U.S. Treasury Arizona LGIP Total Arizona LGIP Federal National Mortgage Association Total U.S. Agencies $ Amount 129,287 24,886 19,654 Custodial credit risk: To control custodial credit risk, the City’s investment policy requires all securities and collateral to be held by an independent third-party custodian in the City’s name. The custodian provides the City with monthly market values along with original safekeeping receipts. IV. Note receivable On October 22, 2008, the Western Loop 101 Public Facilities Corporation (PFC), a blended component of the City dissolved in fiscal year 2016, issued $199,750 in third lien excise tax revenue bonds to construct a baseball spring training facility. On October 1, 2009, the City finalized an Intergovernmental Agreement with the Arizona Sports and Tourism Authority (AZSTA) for the Glendale Spring Training Facility Project. The AZSTA agreed to contribute to the City $60,000 for the construction costs plus interest at 4.13% per annum payable semi-annually. A note receivable for the agreed upon contribution amount plus accrued interest on the note in the amount of $99,144 less an allowance for doubtful accounts in the amount of $50,978 has been recorded at June 30, 2021. In the year 2020, the AZSTA began making payments to the City. A payment of $3,141 has been received by the City on the note as of June 30, 2021. On December 27, 2012, the City of Glendale Municipal Property Corporation (MPC), a blended component unit of the City, issued subordinate excise tax revenue bonds to refund the $199,750 third lien excise tax revenue bonds that were previously issued by the Western Loop 101 Public Facilities Corporation (PFC). The issuance of $183,405 in tax-exempt bonds and $16,850 in taxable bonds achieved debt service savings and lowered the next five fiscal years’ annual rental payments under the Lease Agreement. In fiscal year 2016, the AZSTA receivable was recorded in the MPC debt service fund. 49 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) V. Capital assets A summary of capital asset activity, for the government-wide financial statements, for the year ended June 30, 2021, is as follows: Balances June 30, 2020 Governmental activities Non-depreciable assets: Construction in progress Land Artwork Total non-depreciable assets $ 13,951 117,784 2,639 134,374 Increase $ 23,526 629 24,155 Balances June 30, 2021 Decrease $ (25,996) (1,423) (27,419) $ 11,481 116,990 2,639 131,110 Depreciable assets: Buildings Improvements other than buildings Infrastructure - streets Infrastructure - parks Infrastructure - flood/storm drains Infrastructure - airport Machinery and equipment Computer equipment Software Automotive equipment Total depreciable assets 388,795 287,834 848,829 92,158 80,312 21,341 55,234 5,394 7,128 52,125 1,839,150 1,446 7 28,565 1,763 409 278 208 4,077 36,753 (56) (2,508) (13,855) (74) (217) (2,804) (19,514) 390,185 285,333 877,394 93,921 80,721 21,341 41,657 5,528 6,911 53,398 1,856,389 Less accumulated depreciation for: Buildings Improvements other than buildings Infrastructure - streets Infrastructure - parks Infrastructure - flood/storm drains Infrastructure - airport Machinery and equipment Computer equipment Software Automotive equipment Total accumulated depreciation (161,145) (175,789) (376,439) (52,421) (14,519) (11,456) (46,641) (5,001) (4,661) (35,231) (883,303) (9,465) (9,573) (22,703) (3,109) (1,142) (478) (2,146) (357) (107) (3,658) (52,738) 2,508 13,817 71 216 2,619 19,231 (170,610) (182,854) (399,142) (55,530) (15,661) (11,934) (34,970) (5,287) (4,552) (36,270) (916,810) Total depreciable assets, net 955,847 (15,985) (283) 939,579 Governmental activities capital assets, net $ 1,090,221 50 $ 8,170 $ (27,702) $ 1,070,689 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) Balances June 30, 2020 Increase Decrease Balances June 30, 2021 Business-Type activities: Non-depreciable assets: Construction in progress - water and sewer $ Construction in progress - landfill Construction in progress - housing authority Land Total non-depreciable assets 72,561 128 250 16,070 89,009 Depreciable assets: Buildings Water rights Improvements other than buildings Water lines Sewer lines Water treatment plant Sewer treatment plant Meters and services Fire hydrants Machinery and equipment Computer equipment System Purchase Automotive equipment Total depreciable assets 17,720 9,183 90,443 150,961 152,473 280,663 142,577 34,802 5,440 5,291 1,292 1,163 28,280 920,288 3 1,361 5,139 7,993 3,209 22,855 3,427 738 793 373 13 4,428 50,332 (70) (68) (2,424) (2,562) 17,723 9,183 91,804 156,100 160,466 283,872 165,432 38,229 6,178 6,014 1,597 1,176 30,284 968,058 Less accumulated depreciation for: Buildings Water rights Improvements other than buildings Water lines Sewer lines Water treatment plant Sewer treatment plant Meters and services Fire hydrants Machinery and equipment Computer equipment System Purchase Automotive equipment Total accumulated depreciation (11,885) (2,496) (42,242) (59,728) (76,762) (142,710) (66,646) (18,514) (3,022) (3,717) (992) (1,081) (18,679) (448,474) (362) (179) (3,860) (3,652) (3,663) (9,824) (4,201) (1,104) (106) (576) (32) (2,235) (29,794) 39 68 16 2,391 2,514 (12,247) (2,675) (46,102) (63,380) (80,425) (152,534) (70,847) (19,618) (3,128) (4,254) (956) (1,065) (18,523) (475,754) Total depreciable assets, net 471,814 20,538 (48) 492,304 Business-Type activities capital assets, net $ 560,823 51 $ $ 67,296 1,147 48 1,070 69,561 90,099 $ $ (40,789) (1,175) (41,964) (42,012) $ $ 99,068 100 298 17,140 116,606 608,910 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) Depreciation was charged to functions/programs as follows: Governmental activities: General Public safety Public works Street maintenance Community services Total depreciation expense $ $ Business-Type activities: Water and sewer Landfill Solid Waste Housing Total depreciation expense $ $ 15,286 5,044 15,207 12,414 4,787 52,738 26,371 1,545 1,612 266 29,794 Included in the water and sewer depreciation amount is $179 amortization of water storage rights. VI. Construction commitments The City has active construction projects as of June 30, 2021. The projects include street construction, park facilities, and the construction of additional water and sewer facilities. At year-end, the government’s commitments with contractors are as follows: Construction Project Spent-to-Date Commitment General government $ 365 $ 357 Community services 1,945 2,920 Public Safety 618 631 Public works 579 8 Street maintenance 4,681 3,147 Water and sewer facilities 99,068 5,728 Landfill 100 177 Solid Waste 16 Total primary government $ 107,356 $ 12,984 VII. Internal service funds The City is exposed to various risks of loss. Certain of these risks are accounted for within the internal service fund type. A. Risk management On January 1, 1987, the City established a risk management fund for torts, and loss and destruction of assets. The City’s risk management fund purchases excess or commercial insurance as follows: automobile and general liability, errors and omissions, employment practices liability, employee benefit liability, employee benefits wrongful acts, and products completed operations hazards with limits up to $40,000. The risk management fund was fully self-insured through June 30, 1998, for tort liability losses. Effective July 1, 1998, the City purchased excess insurance. Currently the excess insurance liability coverage has a $1,000 self-insured retention. The fund also purchased commercial insurance for 52 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) airport owners and operators’ liability with limits up to $25 and no deductible, crime coverage with limits up to $10,000 with a $50 deductible, fiduciary liability covering the Deferred Compensation Committee with limits up to $5,000 and with a $5 deductible, and public employees blanket bond covering the Risk Management and Workers’ Compensation Trust Fund Board with limits up to $10. Property coverage for damage or destruction of city assets is up to $848,993 with varying sub limits and varying deductibles from $25 up to $500. The property coverage includes all-risk property, builder’s risk, automobile physical damage, boiler and machinery, pollution and cyber (with a $2,000 liability limit). Two excess cyber liability policies were also purchased with limits up to $4,000 and a $25 deductible or 100 notified individuals. Funds receiving insurance coverage pay monthly premiums to the risk management fund based upon a budget model taking into consideration actuarial analysis and projections, prior loss experience, staffing, and operating budget. Premium payments to insurance carriers, loss control, and risk management expenses are made directly from the risk management fund. Insurance coverage has not been significantly reduced in recent years and settled claims have not exceeded insurance in any of the last three years. B. Workers’ compensation On July 1, 1994, the City established a workers’ compensation fund for work-related injuries to employees. The workers’ compensation fund provides statutory coverage for each injured workers’ compensation claim with an $2,000 self-insured retention and employers’ liability with a limit of $2,000 per occurrence. Funds receiving insurance coverage pay monthly premiums to the workers’ compensation fund based upon a budget model taking into consideration actuarial analysis and projections prior loss experience, staffing level, operating budget and the National Council on Compensation Insurance workers’ compensation manual rates. Premium payments to insurance carriers and loss control and workers’ compensation expenses are made directly from the workers’ compensation fund. There have been no settlements paid in excess of insurance in any of the past three years. C. Employee benefits On July 1, 2000, the City established an employee benefits fund to meet future cost increases for healthrelated insurance. For active employees’ premiums are collected through contributions from employee paychecks and department budgets. Retirees contribute 100% of the premiums, COBRA participants contribute 100% of premiums plus 2% administration fee for their insurance benefit coverage. Premiums for the medical, vision, dental, and life insurance plans are determined prior to each renewal period based on the actuarial valuation of the costs of claims, administration of the plan, demographics of the group, plan design changes and any new mandated benefits. The City is self-insured on the medical plan with an aggregate stop-loss of 125% and a specific stop-loss of $200. If claims exceed the stop-loss amounts the policy will reimburse the plan for the claims in excess of that amount. Premiums for the self-insured medical plan are set prior to the beginning of each plan year equal to 125% of the expected claims liability. Premium payments to insurance carriers are made directly from the fund. There have been no settlements paid in excess of insurance in any of the past three years nor has insurance coverage been significantly reduced in recent years. 53 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) D. Estimated liability Based on information provided by the actuary, liabilities are reported when it is probable that a loss has occurred, and the amount of the loss can be reasonably estimated. Liabilities include an amount for claims that have been incurred but not reported, the effects of specific, incremental claim adjustment expenses, and other allocated claim adjustment expenses and recoveries for salvage and subrogation. The City’s workers’ compensation self-insurance program liability includes recoveries related to subrogation. Salvage and subrogation are immaterial to employee benefits selfinsurance programs and are not incorporated into the liability. The risk management trust fund and workers’ compensation self-insurance programs do include a provision for unallocated claim adjustment expenses. The workers’ compensation fund includes payment of Industrial Commission taxes and fees. The City claim liabilities are calculated considering the effects of inflation, recent claim settlement trends including frequency and amount of payout and other economic and societal factors. The risk management fund and the workers’ compensation fund are funded to meet a 55% confidence level of the most recent actuarial report. The City reports the estimated liability in net present value dollars using a future investment yield assumption of .51%. These liabilities are reported in the internal service funds at their actuarial determined liability of $17,595 as of June 30, 2021. Changes in the balances of claims liabilities during the past two years are as follows: Risk Management 2021 2020 Workers' Compensation 2021 2020 Unpaid claims, beginning of fiscal year $ 4,458 Current year claims and changes in estimate 1,777 Claims payments (2,504) $ 4,404 $ 7,542 $ 6,852 2,075 (2,021) 4,064 (2,285) 3,347 (2,657) Balance at fiscal year end $ 4,458 $ 9,321 $ 7,542 $ 3,731 Employee Benefits 2021 2020 $ 4,691 $ 28,817 (28,965) $ 4,543 3,744 28,386 (27,439) $ 4,691 E. Fleet Services The Fleet Services Fund was established to track income and expenses of the internal services provided to city departments. The Fleet Services Fund specifically covers vehicle maintenance needs and fuel purchased for city vehicles. F. Technology The Technology Fund and the Technology Projects Fund are used to track income and expenses of the internal services provided to city departments for telephone services, information technology services, and support. The Technology Fund specifically supports all the city’s computers, hardware, and software. The Technology Fund is designed to balance, with the rates (revenues) set to recover the actual expenses each year. The Technology Projects Fund may accrue a fund balance in anticipation of future upgrades and potential carry over of project funding. 54 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) VIII. Leases A. Operating lease revenue The City leases various City-owned properties and buildings under cancelable and non-cancelable longterm lease agreements through fiscal year 2021 and beyond. The carrying value of leased assets is $239,103 (cost of $488,929 less accumulated depreciation of $249,826). The leased properties and buildings are included as capital assets in the government-wide financial statements. Certain leases contain provisions for future increased revenues based upon changes in the Consumer Price Index. Scheduled minimum revenues for non-cancelable leases for succeeding fiscal years ending June 30 are as follows: Total Revenues $ 1,827 1,455 1,334 1,316 1,302 28,757 $ 35,991 Fiscal Year 2022 2023 2024 2025 2026 2027 and beyond Total IX. Short-term debt The City did not issue short-term debt for the year ended June 30, 2021. X. Long-term debt A. General obligation bonds (GO) 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 and are repaid through the City’s levying of property taxes. Retirement of the general obligation bonds in the business-type activities are intended to be paid back by the revenues of the business-type activities. B. Revenue bonds The transportation revenue bonds are special revenue obligations of the City and are used to construct various transportation projects such as roadway widening, intersection improvements, and right-of-way acquisitions. The $58,655 in bonds outstanding is secured by the City’s pledge of a 0.50% transportation excise tax approved by voters on November 6, 2001. The debt service payments are also secured by the same excise tax. The total remaining principal and interest to be paid to a trustee under a trust agreement is $74,204. The current year revenues of $35,329 collected in the transportation special revenue fund paid the current year principal and interest amounts of $3,915 and $2,785 respectively. For transportation revenue bonds, the pledged revenue coverage covenants in the purchase agreements require the transportation excise taxes received must be equal to or at least one and one-half times the total interest and principal payment required in the current fiscal year. The Excise Tax Revenue Refunding bonds are special obligations of the City and are not a general obligation of the City. Under a purchase agreement the City makes monthly payments to a trustee. The payments are secured by a senior claim and pledge by the City of all of the City’s unrestricted excise tax 55 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) revenues which comprise of all excise tax, transaction privilege, franchise and income tax which it collects or is apportioned by the State or political subdivision of the State. The $187,140 in bonds outstanding was issued to refund senior and subordinate excise tax revenue bonds issued by the MPC. The total principal and interest remaining on the bonds to be paid is $246,035. The current year principal and interest amount of $10,815 and $9,477 were funded with a transfer from the General fund. The $167,950 in water and sewer revenue bonds/obligations outstanding has been issued for the construction, acquisition, and equipping of water and sewer facilities and related systems and infrastructure. These are special revenue obligations and are pledged and secured solely by the net revenues of the system. The net revenues of the system consist of revenues collected from customers including development impact fees and interest income less such necessary expenses of operation, maintenance, and repair of the system excluding depreciation, amortization and debt service. The total principal and interest remaining to be paid is $213,644. The current year principal and interest on the bonds were $24,135 and net revenues of the system were $71,426. For water and sewer revenue bond senior obligations, the pledged revenue coverage covenants in the purchase agreements require the revenues received must be equal to or at least one hundred twenty percent of the combined debt service on all outstanding senior obligations. For water and sewer revenue bond subordinate obligations, the pledged revenue coverage covenants in the purchase agreements require the revenues received must be equal to or at least one hundred twenty percent of the combined debt service on all outstanding senior obligations and subordinate obligations. C. Municipal Property Corporation (MPC) bonds In 1982, 2002, 2003, 2006 and 2008 the MPC, a non-profit corporation, issued bonds to finance the construction of a new municipal office complex, hockey arena, public safety training center, parking garage, media center, convention center and city infrastructure, respectively. On October 19, 1982, July 31, 2002, May 1, 2003, and June 1, 2006, the City entered into a lease purchase agreement with MPC, whereby, the City purchased the constructed municipal office complex, hockey arena, public safety training center, parking garage, media center, convention center and city infrastructure, respectively, from MPC. In addition, on April 1, 2004, the City entered into a lease agreement with the MPC to issue bonds to finance an escrow account to refund certain outstanding City improvement district bonds. In June 2008, the City entered into a lease agreement with the MPC to issue bonds to refund outstanding 2006B bonds. In February 2012, the City entered into a lease agreement with the MPC to issue bonds to partially refund outstanding maturities of the bond series 2003, 2004, and 2006. In December 2012, the City entered into a lease agreement with the MPC to issue bonds to partially refund outstanding maturities of the bond series 2003 and 2004, and to fully refund outstanding maturities of the Western Loop 101 Public Facilities Corporation bond series 2008. In March 2015, senior excise tax revenue bonds were issued to refund MPC bonds series 2002B, 2003B, 2006A, and series 2012D, respectively. In April 2016, senior excise tax revenue bonds were issued to refund MPC bond series 2003D in full as well as several maturities of the MPC bond series 2008A. In October 2017, subordinate excise tax revenue bonds were issued to partially refund MPC bond series 2012C. An amount equal to the MPC debt service and related miscellaneous fees, is payable to the MPC in monthly installments by the City. Under the provisions of the purchase agreement, the City has pledged for the payment of the purchase price: 1) all net revenues derived from the municipal office complex and arena, and 2) all excise, transaction, privilege and franchise taxes which the City currently collects, may collect or are allocated to the City by any other governmental unit or municipal corporation, except the City’s share of such amounts which by state law, rule or regulation must be expended for other purposes. However, under no circumstances shall such pledge constitute a general obligation of the City nor will the purchase price be payable from the proceeds of ad valorem taxes. The total principal and interest remaining to be paid is $289,936. Excise tax revenues pledged for repayment of MPC was $206,532. The current year principal and interest paid was $14,844. 56 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) For senior liens, the pledged revenue coverage covenants in the lien agreements require the unrestricted excise taxes received must be equal to or at least three times the senior excise tax obligation payment required in any current fiscal year. The requirement for subordinate liens is the unrestricted excise taxes received must be equal to at least two times the combined total payment on senior excise tax obligations and subordinate lien excise tax obligations in any current fiscal year. D. Changes in long-term liabilities The following is a summary of changes in long-term liabilities reported in the governmental activities financial statements for the year ended June 30, 2021: June 30, 2020 General obligation (GO) bonds General obligation (GO) bondsDirect borrowing Revenue bonds: Excise Tax Revenue bonds Transportation bonds Transportation bonds-Direct borrowing M unicipal Property Corporation Total bonds payable $ Other long-term obligations: Net pensions and OPEB liabilities Compensated absences Claims and judgments Unamortized premium on debt issuance Discount on debt issuance Developer payable obligations Total other long-term obligations Total $ 75,905 Increases Decreases $ $ 13,700 (13,800) June 30, 2021 $ 75,805 Amounts Due Within One Year $ 14,930 24,540 - (2,115) 22,425 2,185 197,955 55,340 - (10,815) (3,900) 187,140 51,440 11,690 4,095 7,230 190,225 551,195 13,700 (15) (5,375) (36,020) 7,215 184,850 528,875 15 5,295 38,210 351,481 30,352 16,691 43,639 13,752 34,658 (1,177) (12,620) (33,754) 393,943 31,484 17,595 15,720 17,595 48,823 2,277 (4,941) 46,159 4,775 (452) 4,693 451,588 200 94,526 26 (52,466) (426) 4,893 493,648 38,090 1,002,783 $ 108,226 $ (88,486) $ 1,022,523 $ 76,300 General, transportation, and police and fire sales tax special revenue funds typically have been used to liquidate compensated absences in prior years, since most employees engaged in governmental activities are paid from those funds. Paychecks include payment for leave taken during the current pay period. Of the $1,022,523 in the total liabilities, $579,501 is related to net position for the City’s net investment in capital assets. Other obligations not included in the calculation of net position for the City’s net investment in capital assets are pension and OPEB obligations, compensated absences, and claims and judgments. No governmental funds cash has been used to fund the City of Glendale post-employment healthcare plan post-employment benefit obligation (OPEB). The net annual City of Glendale postemployment healthcare OPEB cost for the current fiscal year was funded by the employee benefits internal service fund. This fund receives money from employee contributions as well as general and water and sewer fund contributions. 57 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) The following is a summary of changes in long-term liabilities reported in the business-type activities financial statements for the year ended June 30, 2021: June 30, 2020 Water and sewer revenue/obligation bonds $ Other long-term obligations: Estimated closure and post-closure costs Unamortized premium on debt issuance Net pensions and OPEB liabilities Compensated absences Housing noncurrent liabilities Total other long-term obligations Total $ 167,250 Amounts Due Within One Year Additions Reductions June 30, 2021 $ $ (42,270) $ 167,950 $ 17,085 42,970 16,019 798 - 16,817 - 17,981 30,921 4,161 56 69,138 14,042 5,359 1,846 (2,739) (278) (1,651) (32) (4,700) 29,284 36,002 4,356 24 86,483 3,142 2,197 5,339 (46,970) $ 254,433 $ 22,424 236,388 22,045 $ 65,015 $ Of the $254,433 in total liabilities, $197,234 (including matured bonds payable) is included in the calculation of net position for the City’s net investment in capital assets. Other obligations not included in the calculation of net position for the City’s net investment in capital assets are estimated landfill closure and post-closure costs, pension and OPEB liabilities, compensated absences, and housing noncurrent liabilities. E. Current and advance refunded bonds The City has no current or advance refunded bonds outstanding as of June 30, 2021. The remainder of this page left blank intentionally. 58 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) F. Bonds payable Bonds payable on June 30, 2021, are comprised of the following: Classified in governmental activities on the government-wide financial statements: Purpose Interest Rate Issued Fiscal Year Ending June 30 Year Series M atures GO bonds payable from secondary assessed property taxes Refunding Tax-Exempt 4.00-5.00 2011 Refunding Tax-Exempt 2.00-5.00 2015 Various Tax-Exempt(A), Taxable(B) 1.54-4.00 2016 Various Tax-Exempt 2018 5.00 2018 Various Taxable 2019 3.00-5.00 2019 Various Tax-Excempt 2021 3.00-5.00 2021 Total Amount of Original Issue Bonds Outstanding June 30, 2021 2022 2022 2036 2037 2038 2041 38,300 39,490 27,285 15,240 15,385 13,700 3,370 7,335 25,405 11,020 14,975 13,700 75,805 GO bonds payable from secondary assessed property taxes-direct borrowing Refunding Taxable BAB 2017 3.16 2018 2030 Total 26,555 22,425 22,425 Revenue bonds payable from the 0.5% transportation sales tax Refunding Tax-Exempt Excise Tax Rev 2.00-5.00 2015 Total 2032 55,635 51,440 51,440 Revenue bonds payable from the 0.5% transportation sales tax-direct borrowing Refunding Tax-Exempt Excise Tax Rev 2.62 2017 2032 Total 19,330 7,215 7,215 2031 2033 2033 2032 100,430 13,700 33,830 65,385 82,700 13,700 29,145 61,595 187,140 M unicipal Property Corporation payable from general fund lease payments M PC Taxable excise tax 2003B 1.46-5.58 2003 2033 M PC Taxable excise tax 2008B 5.45-6.16 2008 2033 M PC Tax-Exempt refunding 2012B 5.00 2013 2033 M PC Tax-Exempt refunding 2012C 5.00 2013 2038 Total 105,260 52,780 39,620 183,405 1,480 37,720 37,405 108,245 184,850 Excise Tax bonds payable from general fund sales tax Refunding Tax-Exempt 2015A 5.00 Refunding Taxable 2015B 3.93-4.03 Refunding Tax-Exempt 2016 3.00-5.00 Sub Refunding Tax-Exempt 2017 5.00 Total 2015 2015 2016 2018 Total bonds payable recorded in governmental activities Less current portion Long-term portion of bonds payable recorded in governmental activities 59 $ 528,875 (38,210) 490,665 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) Classified in business-type activities on the government-wide financial statements: Issued Fiscal Year Ending June 30 Year Series Matures Amount of Original Issue Revenue bonds/obligations payable from water and sewer fund Various refunding 2.00-5.00 2012 2028 Various refunding 2.50-5.00 2015 2028 Various refunding 5.00 2021 2030 Various 5.00 2021 2041 Total 77,635 121,245 20,250 22,720 Purpose Interest Rate Bonds Outstanding June 30, 2021 43,345 81,635 20,250 22,720 167,950 Total bonds payable recorded in business-type activities Less current portion Long-term portion of bonds payable recorded in business-type activities 167,950 (17,085) 150,865 $ G. Legal debt margin The Arizona Constitution provides that the general obligation bonded indebtedness for a city for general municipal purposes may not exceed 6% of the limited assessed valuation of the taxable property in that city. In addition to the 6% limitation for general municipal purpose bonds, cities may issue general obligation bonds up to 20% of the limited assessed valuation for supplying such city with water, sewer, artificial light, public safety, law enforcement, fire and emergency services, streets and transportation facilities, and for the acquisition and development of land for open space preserves, parks, playgrounds and recreational facilities. The City’s unused bonded debt borrowing capacity as of June 30, 2021, is as follows: 6% Capacity to incur bonded debt Less: Bonded debt applicable to limit Unused bonded debt capacity $ $ 143,700 (8,514) 135,186 20% $ $ 479,001 (95,584) 383,417 The various bond indentures contain significant limitations and restrictions on annual debt service requirements, maintenance and flow of monies through various restricted accounts, and minimum revenue and bond coverage. The City is in compliance with all such significant limitations and restrictions. The remainder of this page left blank intentionally. 60 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) H. Bonds authorized, issued and unissued Bonds authorized but not fully issued as of June 30, 2021, are shown below: GO bonds Authorized Amount Issued through June 30, 2021 Authorized but Unissued Voter authorized October 20, 1981 Operations center $ $ $ 6,750 Voter authorized March 10, 1987 Library 550 6,200 9,698 8,000 1,698 Cultural facility (1) Economic development 18,215 50,500 5,081 28,453 13,134 22,047 Governmental facilities (1) 40,910 17,165 23,745 17,000 15,398 53,700 1,460 3,419 15,540 15,398 50,281 6,935 185 6,750 20,554 16,155 102,638 79,065 437,518 11,049 3,643 10,181 61,373 150,559 9,505 12,512 92,457 17,692 286,959 Voter authorized November 2, 1999 Landfill development Library Open spaces (1) Transit (1) Voter authorized May 15, 2007 Flood control Parks and recreation Public safety Streets and parking Total GO bonds $ $ $ Revenue bonds Voter authorized November 2, 1999 Water and sewer(1) Total revenue bonds $ 10,000 10,000 $ - $ 10,000 10,000 Total bonds $ 447,518 $ 150,559 $ 296,959 (1) Certain general obligation bonds or revenue bonds can be issued as general obligation bonds, revenue bonds or a combination thereof. 61 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) I. Other debt (developer, notes, long-term) Classified in the governmental activities in the government-wide financial statements: Developer Payable Obligation - On December 1, 2005, the City entered into a development and ground lease agreement with Cabela’s whereby Cabela’s has the option to purchase the City owned property 90 days after the expiration of the 20-year ground lease (option date). In addition, the City entered into a site improvement management agreement on July 1, 2006, whereby Cabela’s accrues a management compensation amount for their actual costs of operation, maintenance, and repair of site improvements. The management compensation amount accrues annually with interest. At the option date Cabela’s can purchase the property at Fair Market Value and receive a credit against the purchase price for the accrued management compensation amount. The remainder of this page left blank intentionally. 62 $ 4,893 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) J. Future year debt service requirements Fiscal Year Ending Transportation Bonds 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 Total 6,495 6,490 6,496 6,495 6,493 6,494 6,493 6,494 6,491 6,494 Transportation Bonds Direct Borrowing MPC Bonds Excise Tax Bonds - 204 204 203 208 207 207 206 206 205 205 7,214 - 14,476 13,150 13,134 13,096 13,092 13,090 13,074 13,836 13,799 13,792 14,915 27,821 22,533 22,533 22,532 22,531 22,532 - 20,658 21,987 22,000 22,034 22,049 22,041 22,059 21,300 21,338 21,342 20,224 9,003 - 64,935 9,269 289,936 Less interest 13,495 2,054 Principal $ 51,440 7,215 $ G.O. Bonds 246,035 18,062 6,285 5,966 5,138 5,148 5,145 5,147 5,322 5,135 5,137 5,158 5,224 5,215 5,213 5,244 3,094 2,086 809 817 819 100,164 105,086 58,895 24,359 $ 184,850 $ 187,140 $ 75,805 G.O. Bonds Direct Borrowing 2,893 2,898 2,898 2,899 2,903 2,905 2,904 2,905 2,909 - 26,114 87,443 76,814 76,495 75,664 75,690 73,224 69,488 58,185 57,995 49,390 49,930 44,468 30,165 30,166 30,195 28,044 27,037 3,229 3,237 3,239 950,098 3,689 45,695 253,273 22,425 $ 167,950 The remainder of this page left blank intentionally. 63 Total 24,655 25,800 25,798 25,794 25,798 23,342 19,605 8,122 8,118 2,420 2,419 2,420 2,417 2,420 2,419 2,419 2,419 2,420 2,420 2,420 213,645 - $ Water and Sewer Revenue Bonds/ Obligations $ 696,825 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) The following table discloses the debt service requirements as of June 30, 2021, segregating principal and interest, for the next five years and in five-year increments thereafter. Fiscal Year 2022 2023 2024 2025 2026 2027-2031 2032-2036 2037-2041 Total Principal 55,295 47,395 49,040 50,335 52,545 229,605 152,845 59,765 $ 696,825 Interest 32,148 29,419 27,455 25,329 23,145 78,677 32,079 5,021 $ 253,273 $ Total 87,443 76,814 76,495 75,664 75,690 308,282 184,924 64,786 950,098 K. New bonds On December 17, 2020, the City issued $20,250 in Subordinate Lien Water and Sewer revenue refunding bonds with a stated rate of 5% and a true interest cost of 0.918% to refund $25,685 of the 2027-2030 Water and Sewer revenue A bonds issued in 2010. The City will reduce its total debt service payments over the next 10 years by approximately $6,500 and obtain an economic gain (difference between the present values of the debt service payments on the old and new debt) of approximately $6,896. The bonds are not a general obligation of the City but are a special revenue obligation of the City and are pledged and secured solely by the new revenues of the water and sewer system. On June 3, 2021, the City issued $13,700 in General Obligation bonds to fund streets and parking, public safety, flood control, open spaces, parks, and cultural facilities, construction, reconstruction, or other improvements. The 2021 bonds mature on various dates starting 2022 to 2041 with interest rates of 3.00%-5.00%. The bonds are a direct general obligation of the City and pledged by the full faith and credit of the City. They are repaid through the levying of property taxes by the City. On June 10, 2021, the City issued $22,720 in Subordinate Lien Water and Sewer revenue bonds to fund System acquisition, construction, and improvements. The 2021 bonds mature on various dates starting 2022 to 2041 with a fixed interest rate of 5.00%. The bonds are not a general obligation of the City but are a special revenue obligation of the City and are pledged and secured solely by the new revenues of the water and sewer system. XI. Landfill obligations The City operates a municipal sanitary landfill under an Aquifer Protection Permit and Solid Waste Facility Plan approval issued by the Arizona Department of Environmental Quality requiring future closure work and post-closure monitoring. The permit meets federal and state regulations. These laws and regulations require the City to place a final cover on its landfill site when it stops accepting waste and to perform certain maintenance and monitoring functions at the site for 30 years after closure. Although closure and postclosure care costs will not be paid until near or after the date that the landfill stops accepting waste, the City reports a portion of these closure and post-closure costs as an operating expense in each period based on landfill capacity used. The landfill closure and post-closure care liability at June 30, 2021, calculated below, represents the cumulative amount reported to date based on the use of estimated capacity of the landfill. 64 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) North Cell South Cell 29,076 - 24,607 22,468 91% Capacity (cubic yards) Capacity used to date Percentage of capacity used Total closure and post-closure costs in present dollars: as of June 30, 2021 as of June 30, 2020 $ $ 19,612 19,124 $ $ 18,417 17,959 Closure and post-closure care costs: Amount remaining to be recognized as of June 30, 2021 $ 19,612 $ 1,600 Liability recognized as of June 30, 2021 $ - $ 16,817 These amounts are based on what it would cost to perform all closure and post-closure care in fiscal year 2020-21. The estimated costs are subject to changes due to inflation, deflation, new technology, and applicable laws and regulations. Assets are not restricted to fund the obligations. The estimated remaining life of the landfill is approximately 42 years. According to state and federal laws and regulations, the City must comply with the local government financial test requirements that assure the City can meet the cost of landfill closure, post-closure, and corrective action when needed. The City is in compliance with these requirements. XII. Inter-fund transactions Inter-fund balances at June 30, 2021, consisted of the following: A. Due to/due from Due to general fund from: Major governmental funds Other Special Revenue Fund Other non-major governmental funds Community Development Block Grants Fund Non-Major Proprietary Funds Solid Waste Other proprietary fund Housing Total due to general fund $ 1,116 349 103 $ 8 1,576 The inter-fund balances at June 30, 2021, include short-term loans to cover temporary cash deficits in various funds. This occasionally occurs prior to bond sales or grant reimbursements. All inter-fund balances outstanding at June 30, 2021, are expected to be repaid within one year. The remainder of this page left blank intentionally. 65 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) B. Inter-fund transfers Inter-fund transfers for the year ended June 30, 2021, consisted of the following: Transfers to municipal property corporation debt service fund from: General fund 14,869 Total transfers to municipal property corporation debt service fund 14,869 Transfers to other special revenue fund from: General fund 2,261 Street construction fund 107 Other Construction Fund 10 Fire and police construction fund 16 Water and sewer 270 Non-major proprietary funds 10 Total transfers to non-major special revenue fund 2,674 Transfers to non-major special revenue fund from: General fund 197 Total transfers to non-major special revenue fund 197 Transfers to non-major debt service funds from: General fund 20,307 Transportation special revenue fund 6,710 Total transfers to non-major debt service funds 27,017 Transfers to non-major capital projects fund from: Transportation special revenue fund 9,290 Total transfers to non-major capital projects fund 9,290 Transfers to Water and sewer proprietary fund from: General fund 415 Total transfers to water and sewer proprietary fund 415 Transfers to non-major proprietary funds from: General fund 1,202 Total transfers to other non-major proprietary fund 1,202 Grand total all transfers $ 66 55,664 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) Transfers are used to: 1) move revenues from the fund that statute or budget requires to collect them to the fund that statute or budget requires to expend them; 2) move receipts restricted to debt service from the funds collecting the receipts to the debt service fund as debt service payments become due; and 3) use unrestricted revenues collected in the general fund to finance various programs accounted for in other funds in accordance with budgetary authorizations. The inter-fund transfers are all classified as transfers and are included in the results of operations of both governmental and proprietary funds. XIII. Encumbrances The Arizona Revised Statutes allow cities to encumber unused appropriations for up to sixty days after the end of the fiscal year. However, effective July 1, 1987, the City adopted a policy of not recognizing encumbrances at year-end. All appropriations lapse on the last day of the fiscal year. Any outstanding commitments that the City intends to honor are budgeted in the new fiscal year. At June 30, 2021, the City intended to honor $3,616 of outstanding encumbrances in the new fiscal year. Fund Major: General Transportation Other special revenue Water and sewer Non-Major: Highway Users Gas Tax Internal Service Other capital Landfill Sanitation Total XIV. $ $ 488 8 67 915 2 324 1,518 225 69 3,616 Equity in joint ventures A. Sub-Regional Operating Group (SROG) The City, along with the cities of Phoenix, Mesa, Scottsdale and Tempe participates in the Sub-Regional Operating Group (SROG), a joint venture. SROG constructs, operates and maintains jointly used facilities including the 91st Avenue Waste Water Treatment Plant (Plant) and certain sewage transportation facilities. The City of Phoenix acts as lead agency, and as such, is responsible for the planning, budgeting, construction, operation and maintenance of the Plant. In addition, the City of Phoenix provides all management personnel and financing arrangements and accepts federal grants on behalf of the participants. Each participant pays for its costs of operation and maintenance based on relative sewage flows and strengths and for purchased capacity in the plant and related transportation facilities based on ownership. The latest available audited financial information on the joint venture is as of and for the fiscal year ended June 30, 2020. The City accounts for its approximate 6.4% investment using the equity method in the water and sewer fund. For the year ended June 30, 2021, the City recognized a loss in the joint venture of $416. The City has financed its share of construction costs through the issuance of revenue bonds, development fees and grants. The bonds are collateralized by a pledge of water revenues and are reflected in the financial statements of the water and sewer fund. The joint venture itself has not issued any debt. 67 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) A summary of the audited financial information on the joint venture as of and for the fiscal year ended June 30, 2020, is as follows: Assets Current assets Capital assets, net of accumulated depreciation Total assets Liabilities Net position $ $ Total revenues Total expenses Decrease in net position $ $ 64,452 616,129 680,581 47,619 632,962 66,062 (89,234) (23,172) Copies of separate financial statements of the joint venture can be obtained from Arizona Municipal Water Users Association, 4041 North Central Avenue, Phoenix, Arizona 85012. B. Regional Wireless Cooperative (RWC) The City currently participates with twenty Arizona cities and districts in the Regional Wireless Cooperative agreement for the construction, operation and maintenance of a regional communications network, a joint venture. The City of Phoenix is both the Network and the Administrative Managing Member. As the Network Managing Member, Phoenix operates and maintains the network. As the Administrative Managing Member, Phoenix is responsible for accounting, budgeting, procurement and contracting for the RWC. The City has an ongoing financial responsibility as a result of the agreement to participate in the cost to construct, operate and maintain the network. The city’s share of costs is determined based on the proportionate number of subscriber units in use at the time of assessment. The latest available audited financial information on the joint venture is as of and for the fiscal year ended June 30, 2020. The equity interest for the City at June 30, 2020, was $2,826. The City accounts for its approximate 4.1% investment using the equity method in the Public Safety fund. For the year ended June 30, 2021, the City recognized a loss in the joint venture of $36. The remainder of this page left blank intentionally. 68 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) A summary of the audited financial information on the joint venture as of and for the fiscal year ended June 30, 2020, is as follows: Assets Current assets Capital assets, net of accumulated depreciation Total assets Liabilities and Deferred Inflows of Resources Net position $ $ Total revenues Total expenses Decrease in net position $ $ 3,769 67,044 70,813 2,164 68,649 13,019 (15,268) (2,249) Copies of separate financial statements of the joint venture can be obtained from RWC Director’s Office, 200 W. Washington Street, 12th Floor, Phoenix, Arizona 85003 XV. Jointly governed organizations The Regional Public Transit Authority (RPTA) is a voluntary association of local governments, including Glendale, Phoenix, Mesa, Tempe, Scottsdale, and Maricopa County. Its purpose is to ensure that a viable public transportation system is provided as an alternative for regional mobility and to ease the traffic congestion and air pollution caused by over-reliance on the single occupant vehicle. The Board of Directors consists of the mayors of those cities and a member of the County Board of Supervisors. Arizona Municipal Water Users Association (AMWUA) is a non-profit corporation established and funded by cities in Maricopa County for the development of an urban water policy and to represent the cities' interests before the Arizona legislature. In addition, AMWUA contracts with the cities jointly using the 91st Avenue Waste Water Treatment Plant to perform certain accounting, administrative and support services. XVI. Governmental fund balance components and fund type definitions The City has a formally adopted minimum fund balance policy for the general fund. This policy was adopted though the annual budget process. The policy states that the general fund should maintain a minimum total unassigned fund balance of 25% of the projected annual ongoing revenues. The City’s general fund, unassigned fund balance at June 30, 2021 is $54,511. Per the City’s adopted financial policies, 10% of the general fund operating revenue which totals $28,522 has been earmarked as the Budget Stabilization Reserve and $25,989 has been earmarked as the Operating Reserve. Consistent with the requirements of GASB Statement No. 54, formal Council action was not taken prior to June 30, 2021 to commit these funds; therefore, the funds are reported as unassigned. 69 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) General Nonspendable Inventories and prepaid items Cemetery perpetual care Total Nonspendable Restricted Public transit U.S. drug enforcement Debt service Court security HOM E program Highway user revenue Police activities Fire activities ARPA grant Other grants Development impact fees Streets construction Fire and police construction Park bond construction Economic development Open space/trails Cultural and historical projects Government facilities Neighborhood stabilization Flood control construction Total restricted Committed Artwork Pool/park repair Total committed Assigned Equipment replacement General government capital projects Fire Apparatus Arena Capital Pavement M anagement Bed tax/tourism M ega Events Public safety training facility TPT revenue stabilization Inflation Risk Total assigned Unassigned fund balance $ 6,143 6,143 Transportation Other Special Revenue M unicipal Property Corporation Debt Service $ $ $ 145 145 - - Other Non-M ajor Governmental Funds $ 6,099 6,099 Total Governmental Funds $ 6,288 6,099 12,387 6,765 3,282 10,047 74,374 74,374 1,290 187 463 700 2,640 3,808 3,808 3,472 447 13,849 5 28,227 4,400 2,095 485 1,008 431 684 37 876 249 56,265 74,374 1,290 7,280 187 447 13,849 6,765 3,282 463 705 28,227 4,400 2,095 485 1,008 431 684 37 876 249 147,134 - - 1,736 238 1,974 - - 1,736 238 1,974 442 74,519 959 959 5,573 3,808 62,364 442 30,609 12,500 5,000 3,000 2,271 3,000 5,000 5,000 66,822 54,511 $ 137,523 $ 70 $ $ $ $ 30,609 12,500 5,000 3,000 2,271 3,000 959 5,000 5,000 67,781 54,511 283,787 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) Enterprise Fund Type Water and sewer fund Restricted for debt service $ 16,585 Restricted for revenue bond retirement/replacement and extension Two percent of net water revenues must be, by bond ordinance, reserved for the replacement and extension of the City’s water distribution system, or for the retirement of water revenue bonds. The reservation is only required to the extent that the reserve equals two percent of the value of net capital assets of the water and sewer fund. 10,559 Restricted for OPEB benefits 93 Restricted for other purposes 10,705 Total restricted for water and sewer 37,942 Other enterprise funds Restricted for OPEB benefits 50 Total restricted for other enteprise funds 50 Total restricted for enterprise fund types XVII. $ 37,992 Pensions and other postemployment benefits The City contributes to the Arizona State Retirement System (ASRS) and the Public Safety Personnel Retirement System (PSPRS) for police officers and fire fighters. The plans are component units of the State of Arizona. At June 30, 2021, the City reported the following aggregate amounts related to pensions and other postemployment benefits (OPEB) for all plans to which it contributes: Statement of net position and statement of activities OPEB asset Net pension and OPEB liabilities Deferred outflows of resources related to pensions and OPEB Governmental activities $ 1,773 393,943 Business-type activities $ 143 36,002 89,501 7,019 96,520 14,913 1,717 16,630 47,027 2,598 49,625 Deferred inflows of resources related to pensions and OPEB Pension and OPEB expense 71 Total $ 1,916 429,945 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) A. Arizona State Retirement System (ASRS) Plan Description - City employees not covered by the other pension plans described on the following pages 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 multiple-employer 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, disability, health insurance premium supplemental benefits, and survivor benefits. State statute establishes benefits terms. Retirement benefits are calculated on the basis of age, average monthly compensation, and total credited service as follows: Years of service and age required to receive benefit Retirement initial membership date: Before July 1, 2011 On or after July 1, 2011 Sum of years, age equals 80 30 years, age 55 10 years, age 62 25 years, age 60 5 years, age 50* 10 years, age 62 any years, age 65 5 years, age 50* any years, age 65 Final average salary is based on Highest 36 consecutive months of last 120 months Highest 60 consecutive months of last 120 months Benefit percent per year of service 2.1% to 2.3% 2.1% to 2.3% *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 earnings. 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. Health insurance premium benefits are available to retired or disabled members with 5 years of credited service. The benefits are payable only with respect to allowable health insurance premiums for which the member is responsible. For members with 10 or more years of service, benefits range from $100 per month to $260 per month depending on the age of the member and dependents. For members with 5 to 9 years of service, the benefits are the same dollar amounts as above multiplied by a vesting fraction based on completed years of service. Active members are eligible for a monthly long-term disability benefit equal to two-thirds of monthly earnings. Members receiving benefits continue to earn service credit up to their normal retirement dates. Members with long-term disability commencement dates after June 30, 1999, are limited to 30 years of service or the service on record as of the effective disability date if their service is greater than 30 years. 72 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) 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, 2021, active ASRS members were required by statute to contribute at the actuarially determined rate of 12.22 percent (12.04 percent for retirement and 0.18 percent for long-term disability) of the members’ annual covered payroll. The City was required by statute to contribute at the actuarially determined rate of 12.22 percent (11.65 percent for retirement, 0.39 percent for health insurance premium benefit, and 0.18 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 10.21 percent (10.14 percent for retirement, and 0.07 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, health insurance premium benefit, and long-term disability plans for the year ended June 30, 2021, were $9,030, $302, and $139, respectively. During fiscal year 2021, the City paid for ASRS pension and OPEB contributions as follows: 63% from the governmental funds and 37% from the enterprise funds. Liability – At June 30, 2021, the City reported the following asset and liabilities for its proportionate share of the ASRS’ net pension/OPEB asset or liability: Net pension/OPEB (asset) liability ASRS Pension Health insurance premium benefit Long-term disability 115,254 (476) 507 The net asset and net liabilities were measured as of June 30, 2020. The total liability used to calculate the net asset or net liability was determined using update procedures to roll forward the total liability from an actuarial valuation as of June 30, 2019, to the measurement date of June 30, 2020. The City’s proportionate share of the net asset or net liability was based on the City’s actual contributions to the plan relative to the total of all participating employers’ contributions for the year ended June 30, 2020. The City’s proportions measured as of June 30, 2020, and the change from its proportions measured as of June 30, 2019 were: Proportion June 30, 2020 ASRS Pension Health insurance premium benefit Long-term disability Decrease from June 30, 2019 0.66519% 0.67104% 0.66804% (0.00518) (0.00495) (0.00531) Expense - For the year ended June 30, 2021, the City recognized the following pension and OPEB expense: ASRS Pension/OPEB expense Pension Health insurance premium benefit Long-term disability $ 73 11,056 144 159 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) Deferred outflows/inflows of resources - At June 30, 2021 the City reported deferred outflows of resources and deferred inflows of resources related to pensions and OPEB from the following sources: Differences between expected and actual experience Changes of assumptions or other inputs Net difference between projected and actual earnings on pension plan investments Changes in proportion and differences between City contributions and proportionate share of contributions City contributions subsequent to the measurement date Total Pension Deferred Deferred outflows inflows of resources of resources Health insurance premium benefit Deferred Deferred outflows inflows of resources of resources Long-term disability Deferred Deferred outflows inflows of resources of resources $ $ $ $ 1,043 $ - - $ 936 44 $ 13 - - 263 - 55 - 11,116 - 486 - 56 - - 1,492 1 - 7 9,030 21,189 $ 1,492 $ 302 1,052 $ 936 $ 139 301 9 $ 22 The amounts reported as deferred outflows of resources related to ASRS pensions and OPEB resulting from city contributions subsequent to the measurement date will be recognized as an increase of the net asset or a reduction of the net liability in the year ending June 30, 2022. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to ASRS pensions and OPEB will be recognized as expenses as follows: Year Ended June 30, 2022 2023 2024 2025 2026 Thereafter Health insurance premium benefit Pension 49 3,159 4,021 3,438 - (101) 2 24 (26) (85) - The remainder of this page left blank intentionally. 74 Long-term disability 23 32 34 30 16 5 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) Actuarial Assumptions –The significant actuarial assumptions used to measure the total pension/OPEB liability are as follows: Actuarial valuation date Actuarial roll forward date Actuarial cost method Investment rate of return Projected salary increases Inflation Permanent benefit increase Mortality rates Recovery rates Healthcare cost trend rate June 30, 2019 June 30, 2020 Entry age normal 7.5% 2.7-7.2% for pensions/not applicable for OPEB 2.3% Included for pensions/not applicable for OPEB 2017 SRA Scale U-MP for pensions and health insurance premium benefit 2012 GLDT for long-term disability Not applicable Actuarial assumptions used in the June 30, 2019, valuation were based on results of an actuarial experience study for the five-year period ending June 30, 2016. The long-term expected rate of return on ASRS plan investments was determined to be 7.5% using a building block method in which best-estimate ranges of expected future real rates of return (expected returns, net of 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 weighing 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 geometric real rates of return for each major asset class are summarized in the following table: Asset Class Equity Real Estate Fixed Income-Credit Fixed Income-Int Rate Sensitive Total Target Allocation 50% 20% 20% 10% 100% Long-term expected geometric real rate of return 6.39% 5.85% 5.44% 0.22% Discount Rate - At June 30, 2020, the discount rate used to measure the ASRS total pension/OPEB liability was 7.5 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 statutes. Based on those assumptions, the plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the longterm expected rate of return on plan investments was applied to all periods of projected benefit payments to determine the total pension/OPEB liability. The remainder of this page left blank intentionally. 75 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) Sensitivity of the City’s proportionate share of the ASRS net pension/OPEB (asset) liability to changes in the discount rate - The following table presents the City’s proportionate share of the net pension/OPEB (asset) liability calculated using the discount rate of 7.5 percent, as well as what the City’s proportionate share of the net pension/OPEB (asset) liability would be if it were calculated using a discount rate that is 1 percentage point lower (6.5 percent) or 1 percentage point higher (8.5 percent) than the current rate. ASRS City's proportionate share of the Net pension liability Net insurance premium benefit liability (asset) Net long-term disability liability 1% Decrease (6.5%) Current Discount Rate (7.5%) 1% Increase (8.5%) $ $ $ 157,609 623 553 115,254 (476) 507 79,848 (1,410) 462 Plan Fiduciary Net Position - Detailed information about the plan’s fiduciary net position is available in the separately issued ASRS financial report. B. Public Safety Personnel Retirement System (PSPRS) Plan Description - City public safety personnel who are regularly assigned hazardous duty participate in the Public Safety Personnel Retirement System (PSPRS) or employees who became members on or after July 1, 2017, may participate in the Public Safety Personnel Defined Contribution Retirement Plan (PSPDCRP). The PSPRS administers an agent and cost sharing multiple-employer defined benefit pension plans and an agent and cost-sharing multiple-employer defined benefit health insurance premium benefit (OPEB) plans. A nine-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. City public safety personnel who were PSPRS members before July 1, 2017, participate in the agent plans, and those who became PSPRS members on or after July 1, 2017, participate in the PSPRS Tier 3 plans, which are not further disclosed because of their relative insignificance to the City’s financial statements. The PSPRS issues a publicly available financial report that includes their financial statements and required supplementary information. The reports are available on the PSPRS website at www.psprs.com. The remainder of this page left blank intentionally. 76 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) Benefits Provided - The PSPRS provides retirement, health insurance premium supplement, disability, and survivor benefits. State statute establishes benefit terms. Retirement, disability, and survivor benefits are calculated on the basis of age, average monthly compensation, and service credit as follows: Retirement and Disability Years of service and age required to receive benefit Final average salary is based on Benefit percentage Normal Retirement Before January 1, 2012 20 years of service, any age 15 years of service, age 62 Initial Membership Date On or after January 1, 2012 and before July 1, 2017 25 years of service or 15 years of credited service, and age 52.5 On or after July 1, 2017 15 years of credited service, age 52.5* 15 or more years of service, age 55 Highest 36 consecutive months of last 20 years Highest 60 consecutive months of last 20 years Highest 60 consecutive months of last 15 years 50% less 2.0% for each year of credited service less than 20 years OR plus 2.0% to 2.5% for each year of credited service over 20 years, not to exceed 80% 1.5% to 2.5% per year of credited service, not to exceed 80% Accidental Disability Retirement 50% or normal retirement, whichever is greater Catastrophic Disability Retirement 90% for the first 60 months then reduced to either 62.5% or normal retirement, whichever is greater Ordinary Disability Retirement Normal retirement calculated with actual years of credited service or 20 years of credited service, whichever is greater, multiplied by years of credited service (not to exceed 20 years) divided by 20 Survivor Benefit Retired Members 80% to 100% of retired member's pension benefit Active Members 80% to 100% of accidental disability retirement benefit or 100% of average monthly compensation if death was the result of injuries received on the job *With actuarially reduced benefits Retirement and survivor benefits are subject to automatic cost-of-living adjustments based on inflation. PSPRS also provides temporary disability benefits of 50 percent of the member’s compensation for up to 12 months. Health insurance premium benefits are available to retired or disabled members with 5 years of credited service. The benefits are payable only with respect to allowable health insurance premiums for which the member is responsible. Benefits range from $100 per month to $260 per month depending on the age of the member and dependents. The remainder of this page left blank intentionally. 77 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) Employees Covered by Benefit Terms - At June 30, 2021, the following employees were covered by the agent plans’ benefit terms: PSPRS PSPRS Police Firefighters Pension Health Pension Health Inactive employees or beneficiaries currently receiving benefits 237 237 106 106 Inactive employees entitled to but not yet receiving benefits 75 45 41 34 Active employees 365 365 204 204 Total 677 647 351 344 Contributions- 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. Contribution rates for the year ended June 30, 2021, are indicated below. Rates are a percentage of active members’ annual covered payroll. PSPRS Police PSPRS Firefighters Active memberpension 7.65%-9.48% 7.65%-10.60% Active memberhealth insurance premium benefit 0%-0.13% 0%-0.18% City-pension 47.85%-53.24% 43.40%-48.80% City-health insurance premium benefit 0.46%-0.49% 0.0%-0.18% The City’s contributions to the plans for the year ended June 30, 2021, were: PSPRS-Police PSPRS-Fire Pension $ 18,012 10,077 Health insurance premium benefit $ 155 3 During fiscal year 2021, the City paid for PSPRS pension and OPEB contributions 100 percent from the General Fund. Liability - At June 30, 2021, the City reported the following assets and liabilities: PSPRS Police PSPRS Firefighters Net pension (asset) liability $ 207,505 105,515 Net OPEB (asset) liability $ 551 (1,440) The net assets and net liabilities were measured as of June 30, 2020, and the total liability used to calculate the net asset or liability was determined by an actuarial valuation as of that date. 78 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) Actuarial Assumptions - The significant actuarial assumptions used to measure the total pension/OPEB liability are as follows: Actuarial valuation date Actuarial cost method Investment rate of return Wage inflation Price inflation Cost-of-living adjustment Mortality rates Healthcare cost trend rate June 30, 2020 Entry age normal 7.3% 3.5% for pensions/not applicable for OPEB 2.5% for pensions/not applicable for OPEB 1.75% for pensions/not applicable for OPEB Pub-S-2010 tables Not applicable Actuarial assumptions used in the June 30, 2020, valuation was based on the results of an actuarial experience study for the 5-year period ended June 30, 2017. The long-term expected rate of return on PSPRS plan investments was determined to be 7.3 percent using a building-block method in which best-estimate ranges of expected future real rates of return (expected returns, net of 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: Long-term Target expected geometric Asset class allocation real rate of return Cash - Mellon 1% -0.60% Core bonds 2% 0.22% Other assets (Capital appreciation) 7% 5.61% Diversifying strategies 12% 3.22% International public equity 15% 6.09% Global private equity 18% 8.42% Private credit 22% 5.31% U.S. Public equity 23% 4.93% Total 100% Discount Rate – At June 30, 2020, the discount rate used to measure the PSPRS total pension/OPEB liability was 7.3 percent for Tier 1/2 members. The discount rate used to measure the PSPRS total pension/OPEB liability was 7.0 percent for Tier 3 members. The projection of cash flows used to determine the discount rate 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 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 plan investments was applied to all periods of projected benefit payments to determine the total pension/OPEB liability. 79 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) Changes in the net pension/OPEB liability - The following tables present changes in the City’s net pension/OPEB liability for the PSPRS pension plans (Police and Firefighters): PSPRS - Police Balance at June 30, 2020 Changes for the year: Service cost Pension Health insurance premium benefit Increase (decrease) Total Plan Net pension fiduciary pension liability net liability (asset) position (asset) (a) (b) (a) - (b) $ 356,082 $ 167,953 $ 188,129 Increase (decrease) Total Plan Net OPEB fiduciary OPEB liability net liability (asset) position (asset) (a) (b) (a) - (b) $ 5,964 $ 5,438 $ 526 8,002 - 8,002 160 - 160 Interest on the total liability Differences between expected and actual experience in the measurement of the liability Changes of assumptions or other inputs 26,063 - 26,063 443 - 443 8,375 - 8,375 (322) - (322) - - - - - - Contributions - employer - 17,737 (17,737) - 186 (186) Contributions - employee - 3,159 (3,159) - 8 (8) Net investment income Benefit payments, including refunds of employee contributions - 2,301 (2,301) - 68 (68) (14,109) (14,109) - (280) (280) - Administrative expenses - (188) 188 - (6) Other changes - 55 (55) - - - 8,955 $ 176,908 19,376 $ 207,505 - (24) 5,414 25 551 Adjustment to beginning of year Net changes Balance as of June 30, 2021 28,331 $ 384,413 $ 1 5,965 The remainder of this page left blank intentionally. 80 $ 6 $ CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) PSPRS - Firefighters Balance at June 30, 2020 Changes for the year: Service cost Pension Health insurance premium benefit Increase (decrease) Total Plan Net pension fiduciary pension liability net liability (asset) position (asset) $ 216,183 $ 122,583 $ 93,600 Increase (decrease) Total Plan Net OPEB fiduciary OPEB liability net liability (asset) position (asset) $ 3,110 $ 4,634 $ (1,524) 4,791 - 4,791 82 - 82 15,828 - 15,828 231 - 231 4,174 - 4,174 (174) - (174) - - - - - - Contributions - employer - 9,360 (9,360) - 1 (1) Contributions - employee - 2,004 (2,004) - 1 (1) Net investment income Interest on the total liability Differences between expected and actual experience in the measurement of the liability Changes of assumptions or other inputs - 1,642 (1,642) - 58 (58) Benefit payments, including refunds of employee contributions (8,309) (8,309) - (122) (122) - Administrative expenses - (133) 133 - Other changes Net changes Balance as of June 30, 2021 16,484 $ 232,667 5 4,569 $ 127,152 (5) 11,915 $ 105,515 17 $ 3,127 (5) 5 (67) $ 4,567 84 $ (1,440) Sensitivity of the City’s net pension/OPEB (asset) liability to changes in the discount rate - The following table presents the City’s net pension/OPEB (assets) liabilities calculated using the discount rate of 7.3 percent for Tier 1/2 members and the discount rate of 7.0 percent for Tier 3 members, as well as what the City’s net pension/OPEB (asset) liability 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 Net pension liability Net OPEB liability (asset) PSPRS Firefighters Net pension liability Net OPEB asset 1% Decrease (6.30%/6.00%) Current discount rate (7.30%/7.00%) 1% Increase (8.30%/8.00%) $ $ $ 261,668 1,228 137,462 (1,085) 207,505 551 105,515 (1,440) 163,483 (19) 79,379 (1,741) Plan fiduciary net position - Detailed information about the plans’ fiduciary net position is available in the separately issued PSPRS financial report. 81 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) Expense - For the year ended June 30, 2021, the City recognized the following pension and OPEB expense: Pension OPEB Expense Expense (Income) PSPRS Police $ 27,470 $ 42 PSPRS Firefighters 15,195 (93) Deferred outflows/inflows of resources - At June 30, 2021, the City reported deferred outflows of resources and deferred inflows of resources related to pensions and OPEB from the following sources: PSPRS - Police Differences between expected and actual experience Changes of assumptions or other inputs Net difference between projected and actual earnings on plan investments City contributions subsequent to the measurement date Total Health insurance premium Pension Deferred Deferred outflow inflows of resources of resources benefit Deferred Deferred outflow inflows of resources of resources $ $ $ 9,252 $ 2,524 Changes of assumptions or other inputs Net difference between projected and actual earnings on plan investments City contributions subsequent to the measurement date Total $ 1,023 8,428 - 54 103 8,714 - 290 - 18,012 44,406 $ 2,524 PSPRS - Firefighters Differences between expected and actual experience 60 $ 155 559 $ 1,126 Health insurance premium Pension Deferred Deferred outflow inflows of resources of resources benefit Deferred Deferred outflow inflows of resources of resources $ $ $ 4,038 $ 5,104 - $ 546 8,133 - 22 74 6,494 - 246 - 10,077 28,742 5,104 3 271 620 82 $ $ $ CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) The amounts reported as deferred outflows of resources related to pensions and OPEB resulting from City contributions subsequent to the measurement date will be recognized as an increase in the net asset or a reduction of the net liability in the year ended June 30, 2022. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions and OPEB will be recognized as expenses as follows: PSPRS Police Pension Health Year Ending June 30, 2022 2023 2024 2025 2026 Thereafter 6,894 5,634 4,409 4,414 2,518 - (167) (117) (105) (116) (171) (46) PSPRS Firefighters Pension Health 3,054 3,467 3,403 2,601 439 596 (76) (42) (46) (63) (99) (25) C. City of Glendale post-employment healthcare plan The City of Glendale post-employment healthcare plan is a single-employer defined benefit plan administered by the City of Glendale. The plan provides medical, dental, and vision coverage for eligible retirees and their dependents through the City’s group health insurance plans. By continuing to provide eligible retirees with access to the City’s healthcare plans based on the same rates it charges to active employees, the City is in effect providing a blended rate to eligible retirees. This blended rate or implicit rate exists because on average retiree healthcare costs are higher than active employee healthcare costs. Retirees can also continue their basic life insurance benefit. Retirees contribute 100% of the premiums. In order for employees to be eligible for this benefit, they need 5 years of service if they were hired prior to July 1, 2005, and 10 years of service if they were hired after July 1, 2005. Effective July 1, 2018 the plan is closed to new retirees. Only those who retired prior to July 1, 2018 are eligible to continue coverage under the City of Glendale OPEB plan. The Mayor and Council have authority each budget year to establish, eliminate, or amend benefit provisions through the annual budget process. A separate report is not provided as the plan financial information is included in the governmental-wide basis and proprietary funds as part of the City of Glendale reporting entity. Funding policy and employees covered The City pays for and reports retiree health care benefits on a pay-as-you-go basis, which is the practice of paying for these benefits as they become due each year. Contributions to the plan by retirees are established at the beginning of each fiscal year through the annual budget process. The City makes no contribution to the retirees’ premiums other than allowing them to participate through the City’s pooled benefits. For the fiscal year ending June 30, 2021, the number of employees covered by the plan totaled 536. Inactive employees or beneficiaries currently receiving benefits Active employees Total 536 536 Actuarial methods and assumptions Projections of benefits for financial reporting purposes are based on the substantive plan and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between employer and plan members at that point. The actuarial methods and 83 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and actuarial value of assets, consistent with the long-term perspective of the calculations. Actuarial valuations involve estimates of the value of reported amounts and assumptions about the probability of events far into the future. Actuarially determined amounts are subject to continual revision as actual results are compared to past expectations and new estimates are made about the future. Healthcare costs were derived from age-neutral premiums, trended to the valuation date and adjusted for the risk characteristics of the group. Medical healthcare trends were projected at 7.0% decreasing down to an ultimate rate of 5.0%. Effective July 1, 2018, the city discontinued benefits for any future retirees. Only those already retired as of June 30, 2018 are eligible for OPEB benefits. In 2021, amounts reflect updated mortality improvement assumptions with Scale MP-2020. For June 30, 2021, the actuarial cost method used is the entry age normal method. A 1.92% pay as you go discount/investment rate was used. 2016 2017 2018 2019 2020 2021 Discount rate 2.85% 3.43% 3.62% 3.13% 2.45% 1.92% No actuarial valuation of assets was done as there were no assets at the valuation date and the plan does not have a trust established to hold assets. The amortization method is level percent of payroll amortized over 30 years and the period is open. Measurement Date Actuarial valuation date Inflation Salary Increases Discount rate Mortality rates Pre-retirement June 30, 2021 June 30, 2021 2.4% 3.5% including inflation 1.92% Not applicable since plan is closed to new retirees PubG.H-2010 and PubS.H-2010 heathy annuitant mortality table, generational with projection scale MP-2020 Post-retirement Health care cost trend rates 5.0%-7.00% The remainder of this page left blank intentionally. 84 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) Change in total OPEB liability A change in the net OPEB liability was determined by an actuarial valuation as of June 30, 2021. The following table shows the changes in OPEB liability as of June 30, 2021. Total OPEB liability balance at June 30, 2020 $ 2,161 Changes for the Year Interest Differences betweeen expected and actual experience Changes in assumptions or other inputs Change in benefit terms Benefit payments Net Changes 40 (1,878) 491 (201) (1,548) Total OPEB liability balance at June 30, 2021 $ 613 Multi-year schedule of changes in the net OPEB liability is available in the Required Supplementary Information. Discount rate sensitivity The discount rate of 1.92% was used to measure the total OPEB liability. This discount rate is the Fidelity General Obligation AA 20 Year Yield as of June 30, 2021. The following table presents the City’s net OPEB liability calculated using the discount rate noted above, as well as what the City’s OPEB liability 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. 1% Decrease Discount rate Total OPEB liability $ 0.92% 585 Current Discount Rate $ 1.92% 613 1% Increase $ 2.92% 634 Healthcare cost trend rate sensitivity The following table presents the total OPEB liability of the City, as well as the City’s total OPEB liability if it were calculated using healthcare cost trend rates that are 1 percentage point lower or higher than current rates. 4.00% Total OPEB Liability $ Healthcare Cost Trend Rates 5.00% 662 85 $ 613 $ 6.00% 556 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) OPEB expense The following table shows the components of the City’s annual OPEB expense for the year. Interest Difference between Actual and Expected Experience Changes in Assumptions/Inputs Change in Benefit Terms Total FY20 OPEB Expense $ $ 40 (4,516) 128 0 (4,348) Deferred outflows/inflows of resources At June 30, 2021, the City reported deferred outflows of resources and deferred inflows of resources related to OPEB as shown in the following table. Differences between expected and actual experience Changes of assumptions or other inputs Total Deferred Outflows of Resources $ $ - Deferred Inflows of Resources $ 3,459 1,347 $ 4,806 Amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB will be recognized in OPEB expense as follows: OPEB Expense Year Ending June 30, 2022 2023 2024 2025 2026 Thereafter $ $ XVIII. (3,001) (602) (602) (601) (4,806) Contingent liabilities and commitments Amounts received or receivable from grant agencies are subject to audit and adjustment by grantor agencies, principally the federal government. Any disallowed claims, including amounts already collected, may constitute a liability of the applicable funds. The amount, if any, of expenditures that may be disallowed by the grantor cannot be determined at this time, although the city expects such amounts, if any, to be immaterial. The City is subject to claims and litigation, which arise in the ordinary course of its operations. In the opinion of City management, based on the advice of the City attorney, the resolution of such claims and litigation are believed to either have no material adverse effect on the financial position or the future operations of the City or likelihood of a negative outcome to the City is not determinable. 86 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) The City, under the memorandum of agreement with the Arizona Sports and Tourism Authority (AZSTA) and B & B Holdings (DBA Arizona Cardinals), irrevocably assigns, transfers, and pledges unrestricted excise taxes collected at the Multipurpose Facility site (Stadium) to AZSTA. In consideration for the pledge of unrestricted excise tax revenues, the AZSTA issued bonds to improve the stadium infrastructure. The City’s obligation is to make monthly payments to the AZSTA for sales tax payments collected from the site only. The AZSTA bonds do not constitute a legal debt of the City. XIX. Tax Abatement The City implemented GASB Statement No. 77. This statement requires government’s that enter into tax abatement agreements to disclose information about the agreements. The tax abatement is listed by program for the year ended June 30, 2021. The remainder of this page left blank intentionally. 87 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) Primary Government City of Glendale, AZ Purpose of Program Economic Development Tax being abated Sales tax reimbursements The City is authorized pursuant to Article 1, Section3 of its Charter and ARS 9-500.05 and 9-500.11, ARS 11-952 to Authority under which the abatement enter into economic development agreements with agreement is entered businesses located in the City and to appropriate and spend public monies for and in conjunction with economic development activities. Criteria to be eligible to receive abatement Mechanism by which the taxes are abated How amount of abatement is determined Types of commitments made by the City other than to reduce taxes The City analyzes the economic development benefits and determines that such public benefits support and justify the economic development incentives provided by each agreement. The public benefits anticipated are indirect economic and non-economic benefits such as increasing City's residents access to goods and services, enhancing public infrastructure, increasing the City's employment base, increasing the City's assessed property valuation and increasing the City's general tax revenues. The City shall make periodic payments based on a percentage of transaction privilege taxes received by the City for a certain length of time as entered into the agreement after occupancy. Based on a percentage of transaction privilege taxes received by the City for a certain length of time as entered into the agreement or capped at a certain dollar amount. City will abandon real property adjacent to the property for right of way , modifying and rezoning use permit of property. Amount of sales tax reimbursements for the fiscal year ended June 30, 2021 XX. $827 Implementation of new accounting principles The City adopted the provisions of GASB Statement No. 84, Fiduciary Activities. This statement established criteria for identifying fiduciary activities of all state and local governments to include whether the government is controlling the assets of the fiduciary activity, and the beneficiaries with whom a fiduciary relationship exists. This pronouncement did not impact the preparation of these financial statements as the City does not report any fiduciary funds. 88 CITY OF GLENDALE, ARIZONA Notes to the Financial Statements June 30, 2021 (amounts expressed in thousands) The City adopted the provisions of GASB Statement No. 90, Majority Equity Interests. The statement improves consistency and comparability of reporting a government’s majority equity interest in a legally separate organization and to improve the relevance of financial statement information for certain component units. This pronouncement did not impact the preparation of these financial statements. XXI. Subsequent events On July 13, 2021 The City of Glendale closed on $252,800 Certificates of Participation Taxable Series with U.S. National Bank Association whereby the proceeds were used to fund all or a portion of the City’s unfunded liabilities with respect to the Arizona Public Safety Personnel Retirement System and one or more contingency reserve funds with respect to pension and related liabilities. In connection with the Certificates of Participation, the City entered into a ground lease and lease purchase agreement with the U.S. Bank National Association dated July 1, 2021. Under the terms of the fifteen-year lease–purchase agreement, the City leased twenty-nine properties and will make semiannual lease payments beginning December 15, 2021.The lease payments are subject to annual budget appropriation each fiscal period and are not a general obligation or indebtedness of the City or State. On August 19, 2021 The City of Glendale notified the National Hockey League (NHL) and the Arizona Coyotes the operating agreement for use of the Gila River arena will not be renewed beyond the 2021-2022 hockey season. On October 13, 2021 the City of Glendale advanced refunded $16,705 Tax Exempt General Obligation Bonds series 2016A and $11,020 in Tax Exempt General Obligation Bonds series 2018 with $32,225 in Taxable General Obligation Refunding Bonds (2021 Bank Loan Obligations). The 2021 Bank Loan Obligations are general obligation indebtedness of the City. The remainder of this page left blank intentionally. 89 This page left blank intentionally. City of Glendale, Arizona ANNUAL COMPREHENSIVE FINANCIAL REPORT _________________________________________________________ REQUIRED SUPPLEMENTARY INFORMATION (other than MD&A) ___________________________ FOR THE FISCAL YEAR ENDED JUNE 30, 2021 This page left blank intentionally. REQUIRED SUPPLEMENTARY INFORMATION SECTION This part of the City of Glendale’s comprehensive annual financial report presents detailed information for pension plans, OPEB plans, and the general fund budgetary schedule as a context for understanding the information presented in the financial statements and note disclosures. Contents Pages Schedule of the City’s Proportionate Share of the Net Pension/OPEB (Asset)/Liability Cost-Sharing Plans 90-91 Schedule of Changes in the City’s Net Pension/OPEB (Asset)/Liability and Related Ratios Agent Plans 92-97 Schedule of OPEB Liability-City Plan 98-99 Schedule of City Pension/OPEB Contributions 100-103 Notes to Net Pension/OPEB (assets)/liability and contributions 104-105 Budgetary Comparison Schedule-General Fund 106-107 Budgetary Comparison Schedule-Transportation Special Revenue Fund 108 Budgetary Comparison Schedule-Other Special Revenue Funds 109 Notes to Required Supplementary Information 110-111 CITY OF GLENDALE, ARIZONA Schedule of the City's proportionate share of the net pension/OPEB (asset)/liability Cost-sharing plans June 30, 2021 (amounts expressed in thousands) Reporting fiscal year (measurement date) ASRS-Pension 2021 2020 2019 (2020) (2019) (2018) City's proportion of the net pension liability 0.665190% 0.670370% 0.691230% City's proportionate share of the net pension liability $ 115,254 $ 97,547 $ 96,402 City's covered payroll $ 70,766 $ 69,407 $ 67,340 City's proportionate share of the net pension liability as a percentage of its covered payroll 162.87% 140.54% 143.16% Plan fiduciary net position as a percentage of the total pension liability 69.33% 73.24% 73.40% ASRS-Health insurance premium benefit City's proportion of the net OPEB (asset) City's proportionate share of the net OPEB (asset) City's covered payroll City's proportionate share of the net OPEB (asset) as a percentage of its covered payroll Plan fiduciary net position as a percentage of the total OPEB liability ASRS-Long-term disability City's proportion of the net OPEB liability City's proportionate share of the net OPEB liability City's covered payroll City's proportionate share of the net OPEB liability as a percentage of its covered payroll Plan fiduciary net position as a percentage of the total OPEB liability Reporting fiscal year (measurement date) 2021 2020 2019 (2020) (2019) (2018) 0.67104% 0.67599% 0.69452% $ (475) $ (187) $ (250) $ 70,766 $ 69,407 $ 67,340 (0.27%) (0.27%) (0.37%) 104.33% 101.62% 102.20% Reporting fiscal year (measurement date) 2021 2020 2019 (2020) (2019) (2018) 0.66804% 0.67335% 0.69218% $ 507 $ 439 $ 361 $ 70,766 $ 69,407 $ 67,340 0.72% 0.63% 0.54% 68.01% 72.85% 77.83% The notes to pension/OPEB plan schedules are an integral part of this schedule. Note: This schedule is intended to show information for ten years. Additional years' information will be displayed as it becomes available. 90 2018 (2017) 0.666400% $ 103,812 $ 64,059 2017 (2016) 0.637060% $ 102,830 $ 58,301 2016 (2015) 0.605260% $ 94,278 $ 54,853 2015 (2014) 0.619749% $ 91,702 $ 54,523 2014 (2013) 0.656524% $ 109,143 $ 57,475 162.06% 176.38% 171.87% 168.19% 189.90% 69.92% 67.06% 68.35% 69.49% N/A 2018 (2017) 0.67058% $ (365) $ 64,059 2017 - 2011 (2016 - 2010) Information Not Available (0.57%) 103.57% 2018 (2017) 0.66674% $ 242 $ 64,059 2017 - 2011 (2016 - 2010) Information Not Available 0.38% 84.44% 91 2013 - 2011 (2012 - 2010) Information Not Available CITY OF GLENDALE, ARIZONA Schedule of changes in the City's net pension/OPEB (assets)/liability and related ratios Agent plans June 30, 2021 (amounts expressed in thousands) Public Safety Personnel Retirement System - Police: Pension Total pension liability: Service cost Interest on the total pension liability Changes of 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 Total pension liability - ending (a) Plan fiduciary net position: Contributions - employer Contributions - employee Net investment income Benefit payments, including refunds of employee contributions Administrative expenses Other changes Net change in plan fiduciary net position Plan fiduciary net position - beginning Adjustment to Beginning of year Plan fiduciary net position - ending (b) Reporting fiscal year (measurement date) 2021 2020 2019 (2020) (2019) (2018) $ 8,002 $ 8,355 $ 8,012 26,063 24,443 23,135 - $ $ $ 8,375 - 661 7,193 (4,084) - (14,109) 28,331 356,082 384,413 (13,051) 27,601 328,483 356,084 (14,430) 12,633 315,850 328,483 17,737 3,159 2,301 (14,109) (188) 55 8,955 167,953 176,908 $ $ $ 16,942 2,880 8,990 (13,051) (157) (10) 15,594 152,491 (130) 167,955 $ $ $ 10,982 3,351 9,921 (14,430) (152) 192 9,864 142,627 152,491 City's net pension liability (asset) - ending (a) - (b) 207,505 188,129 175,992 Plan fiduciary net position as a percentage of the total pension liability 46.02% 47.17% 46.42% Covered payroll 35,635 36,383 36,201 City's net pension liability (asset) as a percentage of covered payroll 582.31% 517.08% 486.15% The notes to pension/OPEB plan schedules are an integral part of this schedule. Note: This schedule is intended to show information for ten years. Additional years' information will be displayed as it becomes available. 92 2018 (2017) $ 8,582 20,971 2,583 2017 (2016) $ 6,644 18,964 16,926 2016 (2015) $ 6,083 17,857 - 2015 (2014) $ 5,483 14,973 3,331 6,973 8,114 (3,593) 10,446 1,067 - 2,845 19,686 (13,390) 33,833 282,017 315,850 (11,246) 38,139 243,876 282,015 (11,143) 13,864 230,012 243,876 (8,616) 37,702 192,310 230,012 $ $ $ 13,678 4,549 15,468 (13,390) (137) 50 20,218 122,409 142,627 $ $ $ 13,527 4,299 729 (11,246) (105) (2) 7,202 115,207 122,409 $ $ $ 9,691 4,009 4,023 (11,143) (99) (6) 6,475 108,732 115,207 $ $ $ 2014 - 2011 (2013 - 2010) Information not available 8,221 3,432 12,960 (8,616) (104) (124) 15,769 92,963 108,732 173,223 159,606 128,669 121,280 45.16% 43.40% 47.24% 47.27% 37,234 34,196 33,350 31,815 465.22% 466.74% 385.81% 381.20% 93 CITY OF GLENDALE, ARIZONA Schedule of changes in the City's net pension/OPEB (assets)/liability and related ratios Agent plans June 30, 2021 (amounts expressed in thousands) Public Safety Personnel Retirement System - Police: OPEB Total OPEB Liability: Service cost Interest on the total OPEB liability Changes of benefit terms Differences between expected and actual experience in the measurement of the OPEB liability Changes of assumptions or other inputs Benefit payments, including refunds of employee contributions Net change in total OPEB liability Total OPEB liability - beginning Total OPEB liability - ending (a) Plan fiduciary net position: Contributions - employer Contributions - employee Net investment income Benefit payments Administrative expenses Other changes Net change in plan fiduciary net position Plan fiduciary net position - beginning Adjustment to beginning of year Plan fiduciary net position - ending (b) 2021 (2020) $ 160 443 - $ $ (322) - (950) 76 (127) - 211 (359) (280) 1 5,964 5,965 (296) (583) 6,548 5,965 (293) 149 6,399 6,548 (359) 87 6,312 6,399 186 8 68 (280) (6) (24) 5,438 5,414 $ City's net OPEB liability (asset) - ending (a) - (b) Reporting fiscal year (measurement date) 2020 2019 2018 (2019) (2018) (2017) $ 106 $ 102 $ 119 481 467 464 11 $ $ $ 179 5 276 (296) (5) 159 5,150 130 5,439 $ $ $ 75 1 343 (293) (5) 1 122 5,028 5,150 $ $ $ 2017 - 2011 (2016 - 2010) Information not available 202 541 (359) (5) 379 4,649 5,028 551 526 1,398 1,371 Plan fiduciary net position as a percentage of the total OPEB liability 90.77% 91.18% 78.65% 78.58% Covered payroll 35,635 36,383 36,201 37,234 City's net OPEB liability (asset) as a percentage of covered payroll 1.55% 1.45% 3.86% 3.68% The notes to pension/OPEB plan schedules are an integral part of this schedule. Note: This schedule is intended to show information for ten years. Additional years' information will be displayed as it becomes available. 94 This page left blank intentionally. CITY OF GLENDALE, ARIZONA Schedule of changes in the City's net pension/OPEB (asset)/liability and related ratios Agent plans June 30, 2021 (amounts expressed in thousands) Public Safety Personnel Retirement System - Fire: Pension Total pension liability: Service cost Interest on the total pension liability Changes of 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 Total pension liability - ending (a) Plan fiduciary net position: Contributions - employer Contributions - employee Net investment income Benefit payments, including refunds of employee contributions Administrative expenses Other changes Net change in plan fiduciary net position Plan fiduciary net position - beginning Plan fiduciary net position - ending (b) Reporting fiscal year (measurement date) 2021 2020 2019 (2020) (2019) (2018) $ 4,791 $ 4,831 $ 4,963 15,828 15,287 14,302 - $ $ $ 4,174 - (4,945) 3,704 (536) - (8,309) 16,484 216,183 232,667 (8,883) 9,994 206,190 216,184 (6,668) 12,061 194,129 206,190 9,360 2,004 1,642 (8,309) (134) 5 4,568 122,583 127,151 $ $ $ 9,335 1,504 6,476 (8,883) (113) 8,319 114,265 122,584 $ $ $ 6,023 2,050 7,405 (6,668) (113) 54 8,751 105,514 114,265 City's net pension liability (asset) - ending (a) - (b) 105,516 93,600 91,925 Plan fiduciary net position as a percentage of the total pension liability 54.65% 56.70% 55.42% Covered payroll 20,122 22,868 21,360 City's net pension liability (asset) as a percentage of covered payroll 524.38% 409.31% 430.36% The notes to pension/OPEB plan schedules are an integral part of this schedule. Note: This schedule is intended to show information for ten years. Additional years' information will be displayed as it becomes available. 95 2018 (2017) $ 5,062 13,114 1,055 2017 (2016) $ 4,065 11,801 12,497 2016 (2015) $ 3,858 11,230 - 2015 (2014) $ 3,805 9,672 1,658 787 5,437 (2,923) 6,345 (823) - 1,452 9,623 (7,304) 18,151 175,978 194,129 (8,199) 23,586 152,392 175,978 (5,996) 8,269 144,123 152,392 (6,800) 19,410 124,713 144,123 $ $ $ 6,578 2,604 11,234 (7,304) (100) 1 13,013 92,501 105,514 $ $ $ 7,339 2,649 547 (8,199) (79) (232) 2,025 90,476 92,501 $ $ $ 4,942 2,380 3,189 (5,996) (78) (389) 4,048 86,428 90,476 $ $ $ 4,630 2,265 10,457 (6,800) (84) 10,468 75,960 86,428 88,615 83,477 61,916 57,695 54.35% 52.56% 59.37% 59.97% 20,840 20,296 20,570 19,291 425.22% 411.30% 301.00% 299.08% 96 2014 - 2011 (2013 - 2010) Information not available CITY OF GLENDALE, ARIZONA Schedule of changes in the City's net pension/OPEB (asset)/liability and related ratios Agent plans June 30, 2021 (amounts expressed in thousands) Public Safety Personnel Retirement System - Fire: OPEB Total OPEB liability: Service cost Interest on the total OPEB liability Changes of benefit terms Differences between expected and actual experience in the measurement of the OPEB liability Changes of assumptions or other inputs Benefit payments, including refunds of employee contributions Net change in total OPEB liability Total OPEB liability - beginning Total OPEB liability - ending (a) Plan fiduciary net position: Contributions - employer Contributions - employee Net investment income Benefit payments Administrative expenses Other changes Net change in plan fiduciary net position Plan fiduciary net position - beginning Plan fiduciary net position - ending (b) $ $ $ $ 2021 (2020) 82 231 - Reporting fiscal year (measurement date) 2020 2019 2018 (2019) (2018) (2017) $ 52 $ 53 $ 56 251 238 243 3 (174) - (503) 31 (29) - (39) (145) (122) 17 3,110 3,127 (120) (289) 3,399 3,110 (113) 149 3,250 3,399 (153) (35) 3,285 3,250 1 1 58 (122) (5) (67) 4,634 4,567 $ $ $ 242 (120) (4) 118 4,516 4,634 $ $ $ 300 (113) (4) (1) 182 4,334 4,516 $ $ $ 2017 - 2011 (2016 - 2010) Information not available 465 (153) (4) 308 4,026 4,334 City's net OPEB liability (asset) - ending (a) - (b) (1,440) (1,524) (1,117) (1,084) Plan fiduciary net position as a percentage of the total OPEB liability 146.07% 149.05% 132.86% 133.36% Covered payroll 20,122 22,868 21,360 20,840 City's net OPEB liability (asset) as a percentage of covered payroll -7.16% -6.66% -5.23% -5.20% The notes to pension/OPEB plan schedules are an integral part of this schedule. Note: This schedule is intended to show information for ten years. Additional years' information will be displayed as it becomes available. 97 This page left blank intentionally. CITY OF GLENDALE, ARIZONA Schedule of OPEB Liability-City Plan June 30, 2021 (amounts expressed in thousands) Total OPEB Liability-City Plan June 30, 2021 June 30, 2020 June 30, 2019 Service Cost Interest Changes of benefit terms Differences betweeen expected and actual experience Changes in assumptions or other inputs Benefit payments Net Changes $ 40 (1,878) 491 (201) (1,548) $ 71 15 (239) (582) (31) (766) $ 225 (3,204) (175) (296) (3,450) Total OPEB Liability balance at June 30, 2020 $ 2,161 $ 2,927 $ 6,377 Total OPEB Liability balance at June 30, 2021 $ 613 $ 2,161 $ 2,927 Covered Employee Payroll $ - $ - $ - Total OPEB Liability as a percentage of covered employee payroll Discount Rate N\A N\A N\A 1.92% 2.45% 3.13% The notes to pension/OPEB plan schedules are an integral part of this schedule. Note: This schedule is intended to show information for ten years. Additional years' information will be displayed as it becomes available. 98 June 30, 2018 June 30, 2017 June 30, 2016 2015 - 2011 Information Not Available $ 3,083 2,183 (47,511) (11,823) (174) (6) (54,248) $ 3,494 2,311 (3,580) (2,463) (2,952) (237) (3,427) $ 3,376 1,792 (620) 4,548 $ 60,625 $ 64,052 $ 59,504 $ 6,377 $ 60,625 $ 64,052 $ - $ 113,677 $ 93,944 N\A 53.3% 68.2% 3.62% 3.43% 2.85% 99 CITY OF GLENDALE, ARIZONA Schedule of city pension/OPEB contributions June 30, 2021 (amounts expressed in thousands) ASRS-Pension: Statutorily required contribution City's contribution in relation to the statutorily required contribution City's contribution deficiency (excess) City's covered payroll City's contributions as a percentage of coveredpayroll ASRS-Health insurance premium benefit: Statutorily required contribution City's contribution in relation to the statutorily required contribution City's contribution deficiency (excess) City's covered payroll City's contributions as a percentage of coveredpayroll $ 2021 9,030 $ 2020 8,377 $ 2019 8,111 $ 2018 7,414 $ $ 9,030 69,867 $ $ 8,377 70,766 $ $ 8,111 69,407 $ $ 7,414 67,340 12.92% 11.84% 2021 $ 302 2020 $ 345 $ $ ASRS-Long-term disability: Statutorily required contribution City's contribution in relation to the statutorily required contribution City's contribution deficiency (excess) City's covered payroll City's contributions as a percentage of coveredpayroll 302 69,867 $ $ 345 70,766 2021 $ 139 2020 $ 120 0.20% $ $ 0.17% Note: This schedule is intended to show information for ten years. Additional years' information will be displayed as it becomes available. 327 69,407 $ $ 0.47% 385 67,340 0.57% Reporting fiscal year 2019 2018 $ 119 $ 96 120 70,766 The notes to pension/OPEB plan schedules are an integral part of this schedule. 100 $ $ 0.49% 139 69,867 11.01% Reporting fiscal year 2019 2018 $ 327 $ 385 0.43% $ $ 11.69% $ $ 119 69,407 0.17% $ $ 96 67,340 0.14% 2017 $ 7,007 $ $ 7,007 64,059 Reporting fiscal year 2016 2015 $ 6,472 $ 6,071 $ $ 6,472 58,301 10.94% 11.10% $ 2017 361 $ $ 361 64,059 2016-2011 Information not available $ $ 6,071 54,853 11.07% $ 2014 5,978 $ 2013 5,971 $ 2012 5,743 $ 2011 5,685 $ $ 5,978 54,523 $ $ 5,971 57,475 $ $ 5,743 65,443 $ $ 5,685 65,143 10.96% 0.56% $ $ $ 2017 91 91 64,059 2016-2011 Information not available 0.14% 101 10.39% 8.77% 8.73% CITY OF GLENDALE, ARIZONA Schedule of city pension/OPEB contributions June 30, 2021 (amounts expressed in thousands) PSPRS Police-Pension: Actuarially determined contribution City's contribution in relation to the actuarially determined contribution City's contribution deficiency (excess) City's covered payroll City's contributions as a percentage of covered payroll PSPRS Police-OPEB: Actuarially determined contribution City's contribution in relation to the actuarially determined contribution City's contribution deficiency (excess) City's covered payroll City's contributions as a percentage of covered payroll $ 2021 18,012 $ 2020 17,500 $ 2019 16,942 $ 2018 10,982 $ $ 18,012 34,313 $ $ 17,500 35,635 $ $ 17,306 (364) 36,383 $ $ 10,828 154 36,201 52.49% 49.11% 2021 $ 155 2020 $ 187 $ $ 155 34,313 $ $ 0.45% PSPRS Fire-Pension: Actuarially determined contribution City's contribution in relation to the actuarially determined contribution City's contribution deficiency (excess) City's covered payroll City's contributions as a percentage of covered payroll $ $ 183 (4) 36,383 $ $ 0.50% 135 (60) 36,201 0.37% $ 2021 10,077 $ 2020 9,451 $ 2019 9,335 $ 2018 6,023 $ $ 10,077 20,625 $ $ 9,451 20,122 $ $ 9,435 (100) 22,868 $ $ 5,607 416 21,360 $ $ $ 2021 46.97% 3 $ 3 20,625 $ $ 0.01% 2020 1 1 20,122 0.00% The notes to pension/OPEB plan schedules are an integral part of this schedule. Note: This schedule is intended to show information for ten years. Additional years' information will be displayed as it becomes available. 102 29.91% Reporting fiscal year 2019 2018 $ 179 $ 75 0.52% 48.86% PSPRS Fire-OPEB: Actuarially determined contribution City's contribution in relation to the actuarially determined contribution City's contribution deficiency (excess) City's covered payroll City's contributions as a percentage of covered payroll 187 35,635 47.57% 41.26% 26.25% Reporting fiscal year 2019 2018 $ $ $ $ 22,868 0.00% $ $ - 21,360 0.00% 2017 $ 13,678 $ $ 13,678 37,234 Reporting fiscal year 2016 2015 $ 13,527 $ 9,691 $ $ 13,527 34,196 36.74% 39.56% $ 2017 202 $ $ 202 37,234 2016-2011 Information not available $ $ 9,691 33,350 $ 2014 8,221 $ 2013 6,787 $ 2012 5,907 $ 2011 5,248 $ $ 8,221 31,815 $ $ 6,787 28,336 $ $ 5,907 29,356 $ $ 5,248 27,576 29.06% 25.84% 23.95% 20.12% 19.03% 0.54% 2017 $ 6,578 $ $ 6,578 20,840 31.56% $ $ $ 2017 - 20,840 Reporting fiscal year 2016 2015 $ 7,339 $ 4,942 $ $ 7,339 20,296 36.16% $ $ 4,942 20,570 24.03% $ 2014 4,630 $ 2013 3,454 $ 2012 2,828 $ 2011 2,546 $ $ 4,630 19,291 $ $ 3,454 18,547 $ $ 2,828 18,406 $ $ 2,546 16,811 24.00% 2016-2011 Information not available 0.00% 103 18.62% 15.36% 15.14% I. 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: PSPRS Actuarial Methods and Assumptions: Actuarial Cost Method Entry age normal Amortization Level Members with initial membership date before July 1, 2017: Level percent-of-pay, closed Members with initial membership on or after July 1, 2017: Level dollar closed Remaining Amortization Period as of the 2019 Actuarial Valuation Members with initial membership date before July 1, 2017: 18 years for unfunded actuarial accrued liability, 20 years for excess Members with initial membership on or after July 1, 2017: 10 years Asset Valuation Method Members with initial membership date before July 1, 2017: 7-year smoothed market value; 80%/120% market corridor Members with initial membership on or after July 1, 2017: 5-year smoothed market value; 80%120% market corridor Actuarial Assumptions: Investment Rate of Return Members with initial membership date before July 1, 2017: In the 2017 actuarial valuation, the investment rate of return was decreased from 7.50% to 7.40%. In the 2016 actuarial valuation, the investment rate of return was decreased from 7.85% to 7.50%. In the 2013 actuarial valuation, the investment rate of return was decreased from 8.00% to 7.85%. Members with initial membership on or after July 1, 2017: 7% Projected Salary Increases In the 2017 actuarial valuation, projected salary increases were decreased from 4.0%-8.0% to 3.5%-7.5%. In the 2014 actuarial valuation, projected salary increases were decreased from 4.5%–8.5% to 4.0%–8.0%. In the 2013 actuarial valuation, projected salary increases were decreased from 5.0%–9.0% to 4.5%–8.5%. Wage Growth In the 2017 actuarial valuation, wage growth was decreased from 4.0% to 3.5%. In the 2014 actuarial valuation, wage growth was decreased from 4.5% to 4.0%. In the 2013 actuarial valuation, wage growth was decreased from 5.0% to 4.5%. Retirement Age Experience-based table of rates that is specific to the type of eligibility condition. Last updated for the 2012 valuation pursuant to an experience study of the period July 1, 2006 - June 30, 2011 Mortality In the 2017 actuarial valuation, changed to RP-2014 tables, with 75% of MP2016 fully generational projection scales. RP-2000 mortality table (adjusted by 105% for both males and females) 104 CITY OF GLENDALE, ARIZONA Notes to pension/OPEB (assets)/liability and contributions June 30, 2021 (amounts expressed in thousands) II. Factors that affect trends Arizona courts have ruled that provisions of a 2011 law that changed the mechanism for funding permanent pension benefit increases and increased employee pension contribution rates were unconstitutional or a breach of contract because those provisions apply to individuals who were members as of the law’s effective date. As a result, the PSPRS changed benefit terms to reflect the prior mechanism for funding permanent benefit increases for those members and revised actuarial assumptions to explicitly value future permanent benefit increases. PSPRS also reduced those members’ employee contribution rates. These changes are reflected in the plans’ pension liabilities for fiscal year 2015 (measurement date 2014) for members who were retired as of the law’s effective date and fiscal year 2018 (measurement date 2017) for members who retired or will retire after the law’s effective date. These changes also increased the PSPRS-required pension contributions beginning in fiscal year 2016 for members who were retired as of the law’s effective date. These changes increased the PSPRS-required contributions beginning in fiscal year 2019 for members who retired or will retire after the law’s effective date. Also, the City refunded excess employee contributions to PSPRS members. PSPRS allowed the City to reduce its actual employer contributions for the refund amounts. As a result, the City’s pension contributions were less than the actuarially or statutorily determined contributions for 2018 and 2019. The remainder of this page left blank intentionally. 105 City of Glendale, Arizona Budgetary Comparison Schedule General Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Taxes Licenses and permits Intergovernmental Charges for services Fines and forfeitures Investment Income Proceeds from equipment disposal Proceeds from land sale Local revenue Miscellaneous Total revenues Transfer in Transfer out Amounts available for appropriation Budgeted Amounts Original Final 50,490 $ 50,490 $ Actual 86,478 Variance with Final Budget $ 35,988 119,898 12,365 72,465 18,980 2,706 825 250 9,017 126 4,048 240,680 31,482 (42,631) 280,021 119,898 12,365 72,465 18,980 2,706 825 250 9,017 126 4,048 240,680 31,482 (42,633) 280,019 143,620 20,114 78,606 15,745 2,389 624 218 6,296 90 3,194 270,896 51,878 (63,241) 346,011 23,722 7,749 6,141 (3,235) (317) (201) (32) (2,721) (36) (854) 30,216 20,396 (20,608) 65,992 37,661 150,456 16,107 22,098 922 2,150 6,207 235,601 38,910 150,455 16,349 22,109 975 1,462 26,141 256,401 34,823 137,367 16,871 19,279 4,292 7,050 219,682 4,087 13,088 (522) 2,830 (3,317) 1,462 19,091 36,719 CHARGES TO APPROPRIATIONS (OUTFLOWS) Current: General Government Public Safety Public Works Community Services Street Maintenance Contingency Capital Outlay Total charges to appropriations Budgetary fund balances, June 30 $ 44,420 106 $ 23,618 $ 126,329 $ 102,711 Explanation of differences between budgetary inflows and outflows and GAAP revenues and expenditures Sources/inflows of resources: Actual amounts (budgetary basis) "available for appropriation" from the budgetary comparison schedule. Differences - budget to GAAP: The fund balance at the beginning of the year is a budgetary resource but is not a current year revenue for financial reporting purposes. Interest earned on restricted investments not available for appropriation Indirect cost allocation Proceeds from disposal of assets. Revenue reported on a GAAP basis. Miscellaneous Police and fire sales tax revenue. Less: transfers in. Add: transfers out. Total revenues as reported in the statement of revenues, expenditures, and changes in fund balances - governmental funds. Uses/outflows or resources: Actual amounts (budgetary basis) "total charges to appropriations" from the budgetary comparison schedule. Differences - budget to GAAP: Salaries payable. Trade in value of vehicle. Change in prepaid assets or inventory. Internal charges for services provided. Miscellaneous Total expenditures as reported in the statement of revenues, expenditures, and changes in fund balances - governmental funds. 107 $ 346,011 (86,478) (1,963) (10,000) (6,514) 309 (76) 32,563 (51,878) 63,241 $ 285,215 $ 219,682 310 5 1 (10,000) 205 $ 210,203 City of Glendale, Arizona Budgetary Comparison Schedule Transportation Special Revenue Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Taxes Intergovernmental Charges for services Investment Income Miscellaneous Total revenues Transfer out Amounts available for appropriation Budgeted Amounts Original Final 40,254 $ 40,254 $ Actual 63,261 Variance with Final Budget $ 23,007 28,953 2,700 124 160 31,937 (25,311) 46,880 28,953 2,700 124 160 31,937 (25,311) 46,880 35,329 3,962 765 656 4 40,716 (16,000) 87,977 6,376 1,262 641 496 4 8,779 9,311 41,097 14,803 3,524 18,327 14,953 3,708 18,661 12,230 1,323 13,553 2,723 2,385 5,108 CHARGES TO APPROPRIATIONS (OUTFLOWS) Current: Street Maintenance Capital Outlay Total charges to appropriations Budgetary fund balances, June 30 $ 28,553 $ 28,219 $ Explanation of differences between budgetary inflows and outflows and GAAP revenues and expenditures Sources/inflows of resources: Actual amounts (budgetary basis) "available for appropriation" from the budgetary comparison schedule. Differences - budget to GAAP: The fund balance at the beginning of the year is a budgetary resource but is not a current year revenue for financial reporting purposes. Miscellaneous Add: Transfers out. Total revenues as reported in the statement of revenues, expenditures, and changes in fund balances - governmental funds. Uses/outflows or resources: Actual amounts (budgetary basis) "total charges to appropriations" from the budgetary comparison schedule. Differences - budget to GAAP: Salaries payable. Total expenditures as reported in the statement of revenues, expenditures, and changes in fund balances - governmental funds. 108 74,424 $ 46,205 $ 87,977 (63,261) (1) 16,000 $ 40,715 $ 13,553 (3) $ 13,550 City of Glendale, Arizona Budgetary Comparison Schedule Other Special Revenue Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Licenses and permits Intergovernmental Charges for services Fines and forfeitures Investment Income Local revenue Miscellaneous Total revenues Transfer in Amounts available for appropriation Budgeted Amounts Original Final 5,462 $ 5,462 $ Actual 4,286 Variance with Final Budget $ (1,176) 6 8,671 570 417 2 50 17,075 26,791 2,763 35,016 6 8,671 570 417 2 50 17,075 26,791 2,763 35,016 9 18,964 635 348 59 148 199 20,362 2,674 27,322 3 10,293 65 (69) 57 98 (16,876) (6,429) (89) (7,694) 1,368 7,871 1,704 1,677 344 12,187 7,163 32,314 1,820 9,449 1,804 11,195 344 427 7,921 32,960 817 12,690 1,788 6,313 350 415 22,373 1,003 (3,241) 16 4,882 (6) 427 7,506 10,587 CHARGES TO APPROPRIATIONS (OUTFLOWS) Current: General Government Public Safety Public Works Community Services Street Maintenance Contingency Capital Outlay Total charges to appropriations Budgetary fund balances, June 30 $ 2,702 $ 2,056 $ Explanation of differences between budgetary inflows and outflows and GAAP revenues and expenditures Sources/inflows of resources: Actual amounts (budgetary basis) "available for appropriation" from the budgetary comparison schedule. Differences - budget to GAAP: The fund balance at the beginning of the year is a budgetary resource but is not a current year revenue for financial reporting purposes. Revenue reported on a GAAP basis. Miscellaneous Less: Transfers in. Total revenues as reported in the statement of revenues, expenditures, and changes in fund balances - governmental funds. Uses/outflows or resources: Actual amounts (budgetary basis) "total charges to appropriations" from the budgetary comparison schedule. Differences - budget to GAAP: Change in compensated absences liability. Trade in value of vehicle. Miscellaneous Total expenditures as reported in the statement of revenues, expenditures, and changes in fund balances - governmental funds. 109 4,949 $ 2,893 $ 27,322 (4,286) (146) (23) (2,674) $ 20,193 $ 22,373 12 54 (4) $ 22,435 CITY OF GLENDALE, ARIZONA Notes to Required Supplementary Information June 30, 2021 (amounts expressed in thousands) I. Basis of accounting The City prepares its annual budget on a basis which differs from the GAAP basis. A budgetary comparison schedule for the general fund and major special revenue fund is included as required supplementary information to provide a meaningful comparison of actual results to budget on a budget basis. Budgetary comparison schedules for all other governmental funds are presented as other supplemental information after the combining statements. The intent of preparing the Budgetary Comparison Schedule is to provide the reader with a more complete understanding and appreciation for the difference between budgetary revenues and other financing sources and expenditures and other financing uses presented in the Budgetary Comparison Statements and the revenues, expenditures, and other financing sources (uses) reported on the Statement of Revenues, Expenditures, and Changes in Fund Balances, which is prepared in accordance with GAAP. The major areas of difference are as follows: 1. 2. 3. 4. 5. 6. Under the budgetary basis, the revenues and expenses relating to police and fire sales tax is not included in the general fund. The police and fire sales tax is included in the general fund for the GAAP financial statements. Under the budgetary basis, investment income is recognized on an amortized cost basis. In accordance with GASB Statement No. 31, “Accounting and Financial Reporting for Certain Investments and for External Investment Pools" (GASB Statement No. 31), all investment income, including changes in fair value (gains/losses) of investments, are recognized as investment income. Under the budgetary basis, revenues are normally recorded when earned. For GAAP basis, in accordance with GASB Statement No. 33, “Accounting and Financial Reporting for Nonexchange Transactions” (GASB Statement No. 33), and GASB Statement No. 65, all nonexchange transactions, such as government-mandated nonexchange transactions and voluntary nonexchange transactions, can be accrued only if they are measurable and “available”. “Available” has been defined by GASB Statement No. 33 as “collected within the current period or expected to be collected soon enough thereafter to be used to pay liabilities of the current period.” The City has established the availability period as 60 days after the end of the fiscal year. In order to ensure all transactions for the current fiscal year meet this criterion, the City analyzes revenue receipts through August 31 and records adjustments to deferred inflows of resources for transactions that are not collected. Under the budgetary basis, intrafund transfers are recognized as other financing sources (uses). For the GAAP financial statements, intrafund transfers are eliminated to minimize the “grossing-up” of intrafund transfers. Under the budgetary basis, interfund reimbursements or repayments from funds responsible for particular expenditures or expenses to the funds that initially paid for them are recorded as revenues in the payer fund. In accordance with GASB Statement No. 34, an adjustment to eliminate interfund reimbursements is recorded for the GAAP financial statements. In accordance with GAAP, the City has established guidelines for recording expenditure accruals. In order to reasonably ensure that accruals for current fiscal year transactions are materially accurate, the City performs an analysis to identify expenditure accruals for the GAAP financial statements. 110 CITY OF GLENDALE, ARIZONA Notes to Required Supplementary Information June 30, 2021 (amounts expressed in thousands) II. Budgetary information The City utilizes the following procedures in establishing the budgetary data reflected in the financial statements. 1. 2. 3. 4. 5. 6. III. Prior to the first of June of each year, the City Manager submits to the Mayor and Council a proposed operating budget for the fiscal year commencing the following July 1. The budget includes proposed operating, capital and debt service expenditures and the means of financing them. The projected beginning budgeted fund balances for each fund are based on preliminary estimates of the June 30th ending actual budget basis fund balances rather than the June 30th ending budgeted fund balances. These two amounts will differ because of differences in actual results for the year versus planned results and by unused contingency appropriations. The legal level of budgetary control is the total budget as adopted. This is the level at which expenditures cannot legally exceed the appropriated amount. Prior to July 1, after receiving comments in a public hearing, a tentative budget is adopted by the City Council, which sets an upper-dollar limit for all funds combined, beyond which the City may not increase appropriations. After two weeks of legal advertising, the City Council legally adopts a final budget ordinance, which sets appropriations for each fund. Budget basis expenditures may not exceed appropriations for each fund, except in conjunction with the transfer of contingency funds and/or unused appropriation authority from another fund that is backed by additional revenue or fund balance in the fund receiving the appropriation. Contingency funds are appropriated for several funds as identified in the budget basis schedules and may only be transferred with City Council approval. The City Council may reallocate appropriations through budget amendments, but may not increase total appropriations above the total budget, which was legally adopted for the fiscal year. The City Council may authorize a transfer of unencumbered appropriation balanced within an individual city office, department or agency at any time during the fiscal year. During the last three months of the fiscal year, the City Council may approve transfers among city offices, departments, and agencies as necessary. Interfund transfers (i.e., transfers between funds) must be specifically approved by City Council. Procedures for requesting City Council approval of appropriation transfers and delegation of budget responsibility will be set by the City Manager. Budgetary authorization and spending management controls are employed during the year for all funds. Contingency appropriation The principal purpose of a contingency appropriation is to cover any unforeseen expenditure, which may arise after the budget is adopted. It is impossible to estimate revenues exactly or to determine in a prior year the exact expenditures of each program or activity for the ensuing year. Thus, a contingency is essential for budgetary purposes. Contingency appropriation is re-established each fiscal year based on available fund balance and balancing needs of the budget year. The unused balances of contingency appropriations are reflected in the budget basis financial statements. 111 This page left blank intentionally. City of Glendale, Arizona ANNUAL COMPREHENSIVE FINANCIAL REPORT _________________________________________________________ COMBINING STATEMENTS AND SCHEDULES ___________________________ FOR THE FISCAL YEAR ENDED JUNE 30, 2021 This page left blank intentionally. City of Glendale, Arizona Budgetary Comparison Schedule Municipal Property Corporation Debt Service Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Intergovernmental Investment Income Total revenues Transfer in Amounts available for appropriation Budgeted Amounts Original Final 637 $ 637 $ Actual 2,857 Variance with Final Budget $ 2,220 14,869 15,506 14,869 15,506 934 2 936 14,869 18,662 934 2 936 3,156 25 25 10 15 5,375 9,469 14,869 5,375 9,469 14,869 5,375 9,469 14,854 15 CHARGES TO APPROPRIATIONS (OUTFLOWS) Current: General Government Debt service: Principal Interest Total charges to appropriations Budgetary fund balances, June 30 $ 637 112 $ 637 $ 3,808 $ 3,171 NON-MAJOR GOVERNMENTAL FUNDS Special Revenue Funds Special revenue funds are used to account for revenues from specific taxes or other earmarked revenue sources, which by law are designated to finance particular functions or activities of government and which, therefore, cannot be diverted to other uses. Community Development Block Grants Fund This fund accounts for a series of ongoing entitlements received directly from the U. S. Department of Housing and Urban Development (HUD). This fund also includes the HUD Rental Rehabilitation and HOME programs. Highway User Gas Tax Fund This fund accounts for capital outlay and maintenance of municipal streets and highways, as mandated by the Arizona Revised Statutes. Financing for this fund is provided by state-shared fuel taxes. Debt Service Funds Debt service funds are used to account for the accumulation of resources for, and the payment of, general long-term debt principal, interest and related costs. General Obligation Debt Service Fund accounts for the debt service payments for the bonds that were issued to finance government infrastructure such as government facilities, parks, libraries, flood control, economic development and open space/trails Highway User Debt Service Fund This fund accumulates monies for payment of all street and highway revenue bonds of the City. Highway user fuel taxes are transferred from other funds to fund this debt. Transportation Debt Service Fund This fund accumulates monies for payment of the transportation revenue bonds. Transportation excise taxes are transferred from a special revenue fund to fund this debt. Excise Tax Revenue Debt Service Fund This fund accounts for the debt that was issued to refund the senior and subordinate excise tax revenue bonds issued by the Municipal Property Corporation. 113 Capital Projects Funds Capital projects funds are used to account for financial resources to be used for the acquisition or construction of major capital facilities (other than those financed by proprietary funds and trust funds). Streets Construction Fund This fund accounts for the construction of streets, sidewalks, streetlights, traffic signals, and street landscaping funded through GO and revenue bonds issued under authorizations approved by voters on March 10, 1987, and November 2, 1999. In addition, this fund accounts for transportation projects funded by transportation excise tax revenue bonds issued on October 27, 2007. Fire and Police Construction Fund This fund accounts for the construction of fire and police department facilities. Funding is provided through GO bonds issued under authorizations approved by voters on March 10, 1987, and November 2, 1999. Parks Bond Construction Fund This fund accounts for the construction of parks and recreation improvements. Other Construction Fund This fund accounts for the construction of various City projects. Funding is provided through GO bonds issued under authorizations approved by voters on March 10, 1987, and November 2, 1999, and the Federal Aviation Administration. • • • • • • • Flood control facilities Library Transit projects Economic development Open space/trails Government facilities Cultural facilities Development Impact Fees Fund This fund accounts for fees covered by Chapter 28, Article VI of the Municipal Code and is restricted in use by ARS 9-463.05. The fees are used exclusively to provide the necessary public facilities and services for development. Residential development impact fees may be spent only in the district (residential development district, not political district) in which they are collected Permanent Fund Permanent funds are used to report resources that are legally restricted to the extent that only earnings, not principal, may be used for purposes that support the reporting City’s programs. Cemetery Perpetual Care Fund This fund is used to account for the revenues received by the City from the sale of cemetery lots and other related services. 114 City of Glendale, Arizona Combining Governmental Balance Sheet Non-Major Governmental Funds Summary by Fund Type June 30, 2021 (amounts expressed in thousands) ASSETS Equity in pooled cash and investments Receivables, net of allowance for doubtful accounts: Property tax Accounts Intergovernmental receivable Restricted cash and investments Total assets Special Revenue Funds $ LIABILITIES Vouchers payable Accounts payable Retainage payable Compensated Absences - current Due to other funds Unearned revenue Matured interest payable Matured bonds payable Total liabilities DEFERRED INFLOWS OF RESOURCES Deferred Inflows of Resources-Unavailable Revenue Debt Service Funds 13,347 $ Capital Projects Funds 19,147 $ Total Non-Major Governmental Funds Permanent Funds 43,615 $ 6,099 $ 82,208 4,968 2,797 21,112 789 22,789 42,725 64 43,679 117 6,216 789 5,149 2,797 22,789 113,732 902 6 26 349 4,650 5,933 12 8,066 30,645 38,723 5,298 34 711 22 6,065 - 6,200 52 711 26 349 4,672 8,066 30,645 50,721 - 530 - 117 647 15,179 15,179 3,472 3,472 37,614 37,614 6,099 6,099 6,099 56,265 62,364 FUND BALANCES Fund balances: Nonspendable Restricted Total fund balances Total liabilities, deferred outflows of resources and fund balances $ 21,112 115 $ 42,725 $ 43,679 $ 6,216 $ 113,732 City of Glendale, Arizona Combining Balance Sheet Non-Major Special Revenue Funds June 30, 2021 (amounts expressed in thousands) ASSETS Equity in pooled cash and investments Receivables, net of allowance for doubtful accounts: Accounts Intergovernmental receivable Total assets Community Development Block Grants $ LIABILITIES Vouchers payable Accounts payable Compensated Absences - current Due to other funds Unearned revenue Total liabilities 840 Highway User Revenue $ Total Non-Major Special Revenue Funds 12,507 $ 13,347 4,968 1,210 7,018 1,587 14,094 4,968 2,797 21,112 681 6 2 349 4,650 5,688 221 24 245 902 6 26 349 4,650 5,933 1,330 1,330 13,849 13,849 15,179 15,179 FUND BALANCES Fund balances: Restricted Total fund balances Total liabilities,deferred inflows of resources and fund balances $ 116 7,018 $ 14,094 $ 21,112 City of Glendale, Arizona Combining Balance Sheet Non-Major Debt Service Funds June 30, 2021 (amounts expressed in thousands) ASSETS Equity in pooled cash and investments Receivables, net of allowance for doubtful accounts: Property tax Restricted cash and investments Total assets General Obligation $ LIABILITIES Accounts payable Matured interest payable Matured bonds payable Total liabilities DEFERRED INFLOWS OF RESOURCES Deferred Inflows of Resources-Unavailable Revenue Highway User 2,021 $ Transportation 43 $ Total Non-Major Debt Service Funds Excise Tax Revenue 6,168 $ 10,915 $ 19,147 789 17,851 20,661 43 6,168 4,938 15,853 789 22,789 42,725 11 1,936 15,915 17,862 - 1 1,392 3,915 5,308 4,738 10,815 15,553 12 8,066 30,645 38,723 530 - - - 530 2,269 2,269 43 43 860 860 300 300 3,472 3,472 FUND BALANCES Fund balances: Restricted Total fund balances Total liabilities,deferred inflows of resources and fund balances $ 20,661 $ 117 43 $ 6,168 $ 15,853 $ 42,725 City of Glendale, Arizona Combining Balance Sheet Non-Major Capital Projects Funds June 30, 2021 (amounts expressed in thousands) ASSETS Equity in pooled cash and investments Receivables, net of allowance for doubtful accounts: Accounts Total assets Streets Construction $ LIABILITIES Vouchers payable Accounts payable Retainage payable Unearned revenue Total liabilities 10,125 Fire and Police Construction $ 2,264 Parks Bond Construction $ 592 Other Construction $ Total Non-Major Capital Projects Funds Development Impact Fees 2,407 $ 28,227 $ 43,615 64 10,189 2,264 592 2,407 28,227 64 43,679 5,082 685 22 5,789 109 34 26 169 107 107 - - 5,298 34 711 22 6,065 4,400 4,400 2,095 2,095 485 485 2,407 2,407 28,227 28,227 37,614 37,614 FUND BALANCES Fund balances: Restricted Total fund balances Total liabilities,deferred inflows of resources and fund balances $ 10,189 $ 2,264 118 $ 592 $ 2,407 $ 28,227 $ 43,679 City of Glendale, Arizona Combining Balance Sheet Non-Major Permanent funds June 30, 2021 (amounts expressed in thousands) ASSETS Equity in pooled cash and investments Receivables, net of allowance for doubtful accounts: Accounts Total assets Cemetery $ 6,099 117 6,216 DEFERRED INFLOWS OF RESOURCES Deferred Inflows of Resources-Unavailable Revenue 117 FUND BALANCES Fund balances: Nonspendable Total fund balances Total liabilities,deferred inflows of resources and fund balances 6,099 6,099 $ 6,216 119 City of Glendale, Arizona Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Non-Major Governmental Funds Summary by Fund Type For the Year Ended June 30, 2021 (amounts expressed in thousands) REVENUES Taxes and special assessments Licenses and permits Intergovernmental Fines and forfeitures Investment Income Miscellaneous Total revenues Special Revenue Funds $ 814 22,131 45 768 23,758 Debt Service Funds $ Capital Projects Funds 20,520 1 20,521 $ 14,720 156 180 257 15,313 Permanent Funds $ Total Non-Major Governmental Funds 61 61 $ 20,520 15,534 22,287 45 242 1,025 59,653 EXPENDITURES Current: General Government Public Works Public Safety Community Services Street Maintenance Debt service: Principal Interest Capital outlay Total expenditures Excess (deficiency) of revenues over expenditures OTHER FINANCING SOURCES (USES) Long term debt issued Premium on long term debt issued Proceeds from equipment disposal Transfer in Transfer out Total other financing sources (uses) Net change in fund balances Fund balances - beginning Fund balances - ending $ 4,709 11,594 18 - 101 6 1,006 56 9,923 - 119 6 1,006 4,765 21,517 16,303 7,455 30,645 16,135 46,798 (26,277) 19,221 30,313 (15,000) 61 30,645 16,135 19,221 93,414 (33,761) 15 197 212 27,017 27,017 13,700 2,277 9,290 (133) 25,134 - 13,700 2,277 15 36,504 (133) 52,363 7,667 7,512 15,179 740 2,732 3,472 10,134 27,480 37,614 61 6,038 6,099 18,602 43,762 62,364 $ 120 $ $ $ City of Glendale, Arizona Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Non-Major Special Revenue Funds For the Year Ended June 30, 2021 (amounts expressed in thousands) REVENUES Licenses and permits Intergovernmental Fines and forfeitures Miscellaneous Total revenues Community Development Block Grants Highway User Revenue Total Non-Major Special Revenue Funds $ $ $ 4,632 744 5,376 814 17,499 45 24 18,382 814 22,131 45 768 23,758 EXPENDITURES Current: Community Services Street Maintenance Total expenditures Excess (deficiency) of revenues over expenditures OTHER FINANCING SOURCES (USES) Proceeds from equipment disposal Transfer in Total other financing sources (uses) Net change in fund balances Fund balances - beginning Fund balances - ending $ 121 4,709 284 4,993 383 11,310 11,310 7,072 4,709 11,594 16,303 7,455 197 197 15 15 15 197 212 580 750 1,330 7,087 6,762 13,849 7,667 7,512 15,179 $ $ City of Glendale, Arizona Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Non-Major Debt Service Funds For the Year Ended June 30, 2021 (amounts expressed in thousands) REVENUES Taxes and special assessments Investment Income Total revenues Highway User General Obligation $ 20,520 20,520 $ Excise Tax Revenue Transportation - $ - $ Total Non-Major Debt Service Funds 1 1 $ 20,520 1 20,521 EXPENDITURES Current: General Government Debt service: Principal Interest Total expenditures Excess (deficiency) of revenues over expenditures OTHER FINANCING SOURCES (USES) Transfer in Total other financing sources (uses) Net change in fund balances Fund balances - beginning Fund balances - ending $ 8 - 1 9 18 15,915 3,873 19,796 724 - 3,915 2,785 6,701 (6,701) 10,815 9,477 20,301 (20,300) 30,645 16,135 46,798 (26,277) - - 6,710 6,710 20,307 20,307 27,017 27,017 724 1,545 2,269 43 43 9 851 860 7 293 300 740 2,732 3,472 $ 122 $ $ $ City of Glendale, Arizona Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Non-Major Capital Projects Funds For the Year Ended June 30, 2021 (amounts expressed in thousands) REVENUES Licenses and permits Intergovernmental Investment Income Miscellaneous Total revenues Streets Construction $ Fire and Police Construction 156 257 413 $ Parks Bond Construction - $ Other Construction - $ Total Non-Major Capital Projects Funds Development Impact Fees - $ 14,720 180 14,900 $ 14,720 156 180 257 15,313 EXPENDITURES Current: General Government Public Safety Public Works Community Services Street Maintenance Capital outlay Total expenditures Excess (deficiency) of revenues over expenditures 9,917 14,462 24,379 (23,966) 70 998 2,056 3,124 (3,124) 29 1,207 1,236 (1,236) 31 6 8 45 (45) 8 19 6 1,496 1,529 13,371 101 1,006 6 56 9,923 19,221 30,313 (15,000) Long term debt issued Premium on long term debt issued Transfer in Transfer out Total other financing sources (uses) 6,707 1,115 9,290 (107) 17,005 4,834 803 (16) 5,621 1,570 261 (10) 1,821 589 98 687 - 13,700 2,277 9,290 (133) 25,134 Net change in fund balances Fund balances - beginning Fund balances - ending (6,961) 11,361 4,400 2,497 (402) 2,095 585 (100) 485 642 1,765 2,407 13,371 14,856 28,227 10,134 27,480 37,614 OTHER FINANCING SOURCES (USES) $ $ 123 $ $ $ $ City of Glendale, Arizona Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Non-Major Permanent Funds For the Year Ended June 30, 2021 (amounts expressed in thousands) REVENUES Investment Income Total revenues Excess (deficiency) of revenues over expenditures Fund balances - beginning Fund balances - ending Cemetery $ 61 61 61 6,038 6,099 $ 124 City of Glendale, Arizona Budgetary Comparison Schedule Police and Fire Sales Tax Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): Budgeted Amounts Original Final $ 3,284 $ 3,284 Taxes Total revenues Transfer in Transfer out Amounts available for appropriation Budgetary fund balances, June 30 26,365 26,365 (27,890) 1,759 $ 1,759 125 $ 26,365 26,365 (27,890) 1,759 $ 1,759 $ 5,264 Variance with Final Budget $ 1,980 32,563 32,563 (27,890) 9,937 6,198 6,198 8,178 Actual 9,937 $ 8,178 City of Glendale, Arizona Budgetary Comparison Schedule Community Development Block Grants Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Budgeted Amounts Original Final 763 $ Intergovernmental Miscellaneous Total revenues Transfer in Amounts available for appropriation 763 $ Actual 753 Variance with Final Budget $ (10) 6,271 142 6,413 7,176 6,271 142 6,413 7,176 4,632 742 5,374 197 6,324 (1,639) 600 (1,039) 197 (852) 2,231 4,075 4,708 4,075 4,708 284 3,791 3 1 6,310 3 1 8,787 4,992 3 1 3,795 CHARGES TO APPROPRIATIONS (OUTFLOWS) Current: Community Services Street Maintenance Debt service: Principal Interest Total charges to appropriations Budgetary fund balances, June 30 $ 866 126 $ (1,611) $ 1,332 $ 2,943 City of Glendale, Arizona Budgetary Comparison Schedule Highway User Revenue For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Budgeted Amounts Final Original 3,252 $ 3,252 Licenses and permits Intergovernmental Fines and forfeitures Miscellaneous Total revenues Transfer in Transfer out Amounts available for appropriation $ Actual 6,836 Variance with Final Budget $ 3,584 202 15,940 16,142 (5,352) 14,042 202 15,940 16,142 (5,352) 14,042 814 17,499 45 42 18,400 25,236 612 1,559 45 42 2,258 5,352 11,194 12,011 1,000 13,011 12,011 1,000 13,011 11,308 11,308 703 1,000 1,703 CHARGES TO APPROPRIATIONS (OUTFLOWS) Current: Street Maintenance Contingency Total charges to appropriations Budgetary fund balances, June 30 $ 1,031 127 $ 1,031 $ 13,928 $ 12,897 City of Glendale, Arizona Budgetary Comparison Schedule General Obligation Debt Service Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Budgeted Amounts Final Original 13,023 $ 13,023 Taxes Intergovernmental Total revenues Amounts available for appropriation $ Actual 1,545 Variance with Final Budget $ (11,478) 20,690 237 20,927 33,950 20,690 237 20,927 33,950 20,520 20,520 22,065 (170) (237) (407) (11,885) 325 325 8 317 15,915 3,873 20,113 15,915 3,873 20,113 15,915 3,873 19,796 317 CHARGES TO APPROPRIATIONS (OUTFLOWS) Current: General Government Debt service: Principal Interest Total charges to appropriations Budgetary fund balances, June 30 $ 13,837 128 $ 13,837 $ 2,269 $ (11,568) City of Glendale, Arizona Budgetary Comparison Schedule Highway User Debt Service Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): 43 Variance with Final Budget $ - 43 43 - - - - Budgeted Amounts Original Final $ 43 $ 43 43 - Total revenues Transfer in Amounts available for appropriation $ Actual CHARGES TO APPROPRIATIONS (OUTFLOWS) Current: Debt service: Total charges to appropriations Budgetary fund balances, June 30 $ 43 129 $ 43 $ 43 $ - City of Glendale, Arizona Budgetary Comparison Schedule Transportation Debt Service Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Budgeted Amounts Final Original 5,264 $ 5,264 Total revenues Transfer in Amounts available for appropriation $ Actual 851 Variance with Final Budget $ (4,413) 6,710 11,974 6,710 11,974 6,710 7,561 (4,413) 10 10 1 9 3,915 2,785 6,710 3,915 2,785 6,710 3,915 2,785 6,701 9 CHARGES TO APPROPRIATIONS (OUTFLOWS) Current: General Government Debt service: Principal Interest Total charges to appropriations Budgetary fund balances, June 30 $ 5,264 130 $ 5,264 $ 860 $ (4,404) City of Glendale, Arizona Budgetary Comparison Schedule Excise Tax Revenue Debt Service Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Budgeted Amounts Final Original 281 $ Investment Income Total revenues Transfer in Amounts available for appropriation 281 $ Actual 293 Variance with Final Budget $ 12 20,307 20,588 20,307 20,588 1 1 20,307 20,601 1 1 13 15 15 9 6 10,815 9,477 20,307 10,815 9,477 20,307 10,815 9,477 20,301 6 CHARGES TO APPROPRIATIONS (OUTFLOWS) Current: General Government Debt service: Principal Interest Total charges to appropriations Budgetary fund balances, June 30 $ 281 131 $ 281 $ 300 $ 19 City of Glendale, Arizona Budgetary Comparison Schedule Streets Construction Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Budgeted Amounts Final Original 10,659 $ 10,659 Intergovernmental Miscellaneous Premium on long term debt issued Long term debt issued Total revenues Transfer in Transfer out Amounts available for appropriation $ Actual 11,300 Variance with Final Budget $ 641 10,451 10,451 23,953 (307) 44,756 10,451 10,451 23,953 (339) 44,724 156 22 1,115 6,707 8,000 9,290 (107) 28,483 156 22 1,115 (3,744) (2,451) (14,663) 232 (16,241) 150 1,287 43,319 44,756 473 39,641 40,114 9,917 14,227 24,144 (9,444) 25,414 15,970 CHARGES TO APPROPRIATIONS (OUTFLOWS) Current: Street Maintenance Contingency Capital Outlay Total charges to appropriations Budgetary fund balances, June 30 $ - 132 $ 4,610 $ 4,339 $ (271) City of Glendale, Arizona Budgetary Comparison Schedule Fire and Police Construction Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Budgeted Amounts Final Original (766) $ (766) Premium on long term debt issued Long term debt issued Total revenues Transfer in Transfer out Amounts available for appropriation $ Actual (402) Variance with Final Budget $ 364 8,568 8,568 (75) 7,727 8,568 8,568 (75) 7,727 803 4,834 5,637 (16) 5,219 803 (3,734) (2,931) 59 (2,508) 7,727 7,727 7,529 7,529 70 998 2,056 3,124 (70) (998) 5,473 4,405 CHARGES TO APPROPRIATIONS (OUTFLOWS) Current: General Government Public Safety Capital Outlay Total charges to appropriations Budgetary fund balances, June 30 $ - 133 $ 198 $ 2,095 $ 1,897 City of Glendale, Arizona Budgetary Comparison Schedule Parks Bond Construction Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Premium on long term debt issued Long term debt issued Total revenues Transfer in Transfer out Amounts available for appropriation Budgeted Amounts Final Original 70 $ 70 $ Actual (100) Variance with Final Budget $ (170) 1,808 1,808 1,878 1,808 1,808 1,878 261 1,570 1,831 (10) 1,721 261 (238) 23 (10) (157) 249 1,629 1,878 249 1,629 1,878 29 1,207 1,236 (29) 249 422 642 CHARGES TO APPROPRIATIONS (OUTFLOWS) Current: Community Services Contingency Capital Outlay Total charges to appropriations Budgetary fund balances, June 30 $ - 134 $ - $ 485 $ 485 City of Glendale, Arizona Budgetary Comparison Schedule Other Construction Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Budgeted Amounts Final Original 346 $ Premium on long term debt issued Long term debt issued Total revenues Transfer in Transfer out Amounts available for appropriation 346 $ Actual 1,765 Variance with Final Budget $ 1,419 2,441 2,441 2,787 2,441 2,441 (2) 2,785 98 589 687 2,452 98 (1,852) (1,754) 2 (333) 1,944 843 2,787 936 823 1,759 28 6 8 42 (28) (6) (8) 936 823 1,717 CHARGES TO APPROPRIATIONS (OUTFLOWS) Current: General Government Public Works Community Services Contingency Capital Outlay Total charges to appropriations Budgetary fund balances, June 30 $ - 135 $ 1,026 $ 2,410 $ 1,384 City of Glendale, Arizona Budgetary Comparison Schedule Development Impact Fees Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Budgeted Amounts Final Original 12,213 $ 12,213 Licenses and permits Investment Income Total revenues Transfer in Transfer out Amounts available for appropriation $ Actual 14,856 Variance with Final Budget $ 2,643 3,850 40 3,890 16,103 3,850 40 3,890 (1) 16,102 14,720 180 14,900 13,909 (13,909) 29,756 10,870 140 11,010 13,909 (13,908) 13,654 12,716 3,387 16,103 4,958 3,394 8,352 8 19 6 1,496 1,529 (8) (19) (6) 4,958 1,898 6,823 CHARGES TO APPROPRIATIONS (OUTFLOWS) Current: Public Safety Community Services Street Maintenance Contingency Capital Outlay Total charges to appropriations Budgetary fund balances, June 30 $ - 136 $ 7,750 $ 28,227 $ 20,477 City of Glendale, Arizona Budgetary Comparison Schedule Cemetery Perpetual Care Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Budgeted Amounts Original Final 5,048 $ 5,048 Investment Income Total revenues Transfer in Amounts available for appropriation $ Actual 6,038 Variance with Final Budget $ 990 26 26 5,074 26 26 5,074 61 61 6,099 35 35 1,025 5,074 5,074 5,074 5,074 - 5,074 5,074 CHARGES TO APPROPRIATIONS (OUTFLOWS) Current: Contingency Total charges to appropriations Budgetary fund balances, June 30 $ - 137 $ - $ 6,099 $ 6,099 NON-MAJOR PROPRIETARY FUNDS – BUSINESS-TYPE ACTIVITIES Proprietary funds are used to account for City operations that are run like a business. These funds are responsible for providing enough operational revenue to cover all expenses. Landfill This fund accounts for the operation of the City owned landfill and recycling operations. Fees charged for the use of the landfill are used to maintain and improve the landfill operations as well as fund future closure costs. Solid Waste This fund accounts for the City’s trash collection services including curb, roll-off, bulk, and front-load services to individuals and businesses. Revenues collected are used to keep the City clean. Housing This fund accounts for operations to provide affordable housing to those who cannot afford it in the private market. This is done through administration of Federal Section 8 Housing Choice and Conventional Public Housing programs. 138 City of Glendale, Arizona Combining Statement of Net Position Non-Major Proprietary Fund-Business Type Activities June 30, 2021 (amounts expressed in thousands) Landfill ASSETS Current assets: Equity in pooled cash and investments Receivables: Accounts Allowance for uncollectibles Intergovernmental receivable Inventories and prepaid items Total current assets Noncurrent assets: OPEB assets Capital assets: Capital Assets Accumulated Depreciation Capital assets, net Total noncurrent assets Total assets $ DEFERRED OUTFLOWS OF RESOURCES Debit amounts related to pensions and OPEB Total deferred outflows of resources Solid Waste 7,304 $ Total Non-Major Enterprise Funds Housing 35 $ 3,671 $ 11,010 810 (9) 8,105 2,798 (598) 2,235 9 207 15 3,902 3,617 (607) 207 15 14,242 15 27 8 50 42,214 (18,370) 23,844 23,859 31,964 17,863 (10,574) 7,289 7,316 9,551 15,139 (11,415) 3,724 3,732 7,634 75,216 (40,359) 34,857 34,907 49,149 800 800 1,261 1,261 377 377 2,438 2,438 340 304 839 1,483 350 306 103 102 861 54 24 94 270 8 52 502 744 634 94 270 111 993 2,846 296 4,248 16,817 21,361 22,844 224 6,670 6,894 7,755 213 2,046 24 2,283 2,785 733 12,964 24 16,817 30,538 33,384 186 323 109 618 23,844 7,289 3,724 34,857 15 (14,125) 9,734 27 (4,582) 2,734 8 1,385 5,117 50 (17,322) 17,585 LIABILITIES Current liabilities: Vouchers payable Compensated absences Intergovernmental payable Unearned revenue Due to other funds Deposits Total current liabilities Noncurrent liabilities: Compensated absences Net pension & OPEB liabilities Other long term debt Estimated closure and post closure costs Total noncurrent liabilities Total liabilities DEFERRED INFLOWS OF RESOURCES Credit amounts related to pensions and OPEB NET POSITION Net investment in capital assets Restricted for: OPEB benefits Unrestricted Total net position $ $ 139 $ $ City of Glendale, Arizona Combining Statement of Revenues, Expenses, and Changes in Net Position Non-Major Proprietary Fund-Business Type Activities For the Year Ended June 30, 2021 (amounts expressed in thousands) OPERATING REVENUES Intergovernmental Container service Curb service Landfill user fees Recycling sales Other fees Total operating revenues Landfill $ OPERATING EXPENSES Landfill Housing Closure/post-closure care adjustment Solid Waste Amortization and depreciation Total operating expenses Operating income (loss) NONOPERATING REVENUES (EXPENSES) Investment Income Gain/(loss) on disposal of assets Total nonoperating revenues (expenses) Income (loss) before contributions and transfers Capital contributions Transfer in Transfer out Change in net position Total net position - beginning Total net position - ending $ 11,341 874 6 12,221 Solid Waste $ 221 4,668 14,987 1 19,877 Housing $ 10,954 3,121 14,075 Total Non-Major Enterprise Funds $ 11,175 4,668 14,987 11,341 874 3,128 46,173 9,026 797 1,545 11,368 853 17,791 1,612 19,403 474 13,944 266 14,210 (135) 9,026 13,944 797 17,791 3,423 44,981 1,192 68 20 88 941 685 (10) 1,616 8,118 9,734 198 198 672 130 802 1,932 2,734 2 2 (133) 55 387 309 4,808 5,117 70 218 288 1,480 55 1,202 (10) 2,727 14,858 17,585 140 $ $ $ City of Glendale, Arizona Combining Statement of Cash Flows Non-Major Proprietary Funds - Business-Type Activities For the Year Ended June 30, 2021 (amounts expressed in thousands) Landfill CASH FLOWS FROM OPERATING ACTIVITIES Cash received from customers Cash received from federal operating grants Cash paid to internal city departments Cash paid to external vendors Cash paid to employees for services Net cash provided (used) by operating activities $ CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Transfers in Transfers out Advances to/due from other funds Net cash provided (used) by noncapital financing activities 19,520 221 (9,687) (2,044) (6,231) 1,779 $ 3,244 11,084 (12,891) (968) 469 $ 34,584 11,305 (11,289) (19,232) (10,538) 4,830 387 387 1,202 (10) 103 1,295 20 (2,669) (2,649) 198 (2,668) (2,470) - 218 (5,337) (5,119) $ 68 68 676 6,628 7,304 $ (458) 493 35 $ 2 2 858 2,813 3,671 $ 70 70 1,076 9,934 11,010 $ 853 $ 474 $ (135) $ 1,192 CASH FLOWS FROM INVESTING ACTIVITIES Operating Income Adjustments to reconcile operating income (loss) to net cash provided (used) by operating activities: Amortization and depreciation Changes in assets and liabilities: Accounts receivable Intergovernmental receivable Net OPEB asset Net pension and OPEB liability Deferred outflows related to pensions and OPEB Deferred inflows related to pensions and OPEB Inventories and prepaid items Vouchers and accounts payable Intergovernmental payable Deposits Unearned rent Compensated absences Other long term liabilities Estimated closure and post-closure costs Net cash provided (used) by operating activities $ Total 130 103 233 Proceeds from sale of capital assets Acquisition of capital assets and rights Net cash provided (used) by capital and related financing activities Reconciliation of operating income (loss) to net cash provided (used) by operating activities: 11,820 (1,602) (4,297) (3,339) 2,582 Housing 685 (10) 675 CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Interest received from investments Net cash provided (used) by investing activities Net increase (decrease) in cash and cash equivalents Balances - beginning of year Balances - end of the year Solid Waste 1,545 1,612 266 3,423 $ 20 (9) 543 (303) (251) (252) 2 (422) 59 797 2,582 $ (135) (17) 965 (545) (478) (159) 9 53 1,779 $ (8) 130 (5) 271 (154) (136) 2 113 3 128 26 (32) 469 $ (123) 130 (31) 1,779 (1,002) (865) 2 (298) 11 (419) 128 138 (32) 797 4,830 $ $ - $ $ - $ $ 55 55 $ $ 55 55 Noncash investing, capital and financing activities Contibutions of capital assets Total noncash investing, capital and financing activities 141 City of Glendale, Arizona Budgetary Comparison Schedule Water and Sewer Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Intergovernmental Metered water sales Sewer service charges Impact Fees Other fees Investment Income Miscellaneous Premium on long term debt issued Long term debt issued Total Revenues Transfer in Transfer out Amounts available for appropriation CHARGES TO APPROPRIATIONS (OUTFLOWS): Contingency Water Sewer Administrative and general Capital Outlay Principal Interest expense Total charges to appropriations Budgetary fund balance, June 30 Budgeted Amounts Final Original 59,688 $ 59,688 $ Actual 33,153 Variance with Final Budget $ (26,535) 52,730 34,589 2,000 1,068 1,173 30,121 36,000 157,681 24,839 (24,574) 217,634 52,730 34,589 2,000 1,068 1,173 30,121 36,000 157,681 24,839 (24,574) 217,634 469 60,171 37,882 4,230 1,212 160 22,897 7,530 22,720 157,271 29,699 (29,554) 190,569 469 7,441 3,293 2,230 144 (1,013) (7,224) 7,530 (13,280) (410) 4,860 (4,980) (27,065) 2,000 28,960 18,489 16,834 81,210 16,585 7,824 171,902 28,225 16,927 16,486 79,600 16,585 7,824 165,647 27,710 15,038 15,844 69,351 16,585 6,731 151,259 515 1,889 642 10,249 1,093 14,388 $ 45,732 142 $ 51,987 $ 39,310 $ (12,677) City of Glendale, Arizona Budgetary Comparison Schedule Landfill Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Budgeted Amounts Final Original 7,766 $ 7,766 Landfill user fees Recycling sales Other fees Investment Income Proceeds from equipment disposal Long term debt issued Total Revenues Transfer in Transfer out Amounts available for appropriation CHARGES TO APPROPRIATIONS (OUTFLOWS): Contingency Landfill Capital Outlay Total charges to appropriations Budgetary fund balance, June 30 $ 5,667 Variance with Final Budget $ (2,099) 9,852 736 846 25 2,500 13,959 685 (16) 22,394 9,852 736 846 25 2,500 13,959 685 (16) 22,394 11,342 874 436 68 20 12,740 685 (10) 19,082 1,490 138 (410) 43 20 (2,500) (1,219) 6 (3,312) 500 9,934 10,960 21,394 500 9,937 7,536 17,973 9,421 2,668 12,089 500 516 4,868 5,884 1,000 143 $ Actual $ 4,421 $ 6,993 $ 2,572 City of Glendale, Arizona Budgetary Comparison Schedule Solid Waste Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): Budgeted Amounts Original Final $ 7,816 $ 7,816 Intergovernmental Container service Curb service Investment Income Miscellaneous Proceeds from equipment disposal Total Revenues Transfer in Amounts available for appropriation CHARGES TO APPROPRIATIONS (OUTFLOWS): Contingency Solid Waste Capital Outlay Total charges to appropriations Budgetary fund balance, June 30 $ 2,199 Variance with Final Budget $ (5,617) 4,623 14,802 21 53 49 19,548 130 27,494 4,623 14,802 21 53 49 19,548 130 27,494 221 4,668 14,960 1 198 20,048 130 22,377 221 45 158 (21) (52) 149 500 (5,117) 200 16,229 6,227 22,656 16,629 5,217 21,846 17,787 2,668 20,455 (1,158) 2,549 1,391 4,838 144 $ Actual $ 5,648 $ 1,922 $ (3,726) City of Glendale, Arizona Budgetary Comparison Schedule Housing Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Budgeted Amounts Final Original 54 $ Intergovernmental Investment Income Miscellaneous Total Revenues Transfer in Amounts available for appropriation CHARGES TO APPROPRIATIONS (OUTFLOWS): Housing Total charges to appropriations Budgetary fund balance, June 30 $ $ 6,602 Variance with Final Budget $ 6,548 15,519 15,519 387 15,960 15,519 15,519 387 15,960 11,009 2 3,121 14,132 387 21,121 (4,510) 2 3,121 (1,387) 5,161 15,022 15,022 15,022 15,022 13,966 13,966 1,056 1,056 938 145 54 Actual $ 938 $ 7,155 $ 6,217 City of Glendale, Arizona ANNUAL COMPREHENSIVE FINANCIAL REPORT _________________________________________________________ INTERNAL SERVICE FUNDS ___________________________ FOR THE FISCAL YEAR ENDED JUNE 30, 2021 This page left blank intentionally. INTERNAL SERVICE FUNDS Risk Management Fund This fund accounts for potential torts, and loss and destruction of assets. The City’s risk management fund purchases excess and commercial insurance. Workers’ Compensation Fund This fund accounts for work-related injuries to employees. The workers’ compensation fund provides statutory coverage for each injured workers’ compensation claim. Employee Benefits Trust Fund This fund accounts for reserves to meet future cost increases for health-related insurance. Fleet Services Fund This fund is used to track income and expenses of the internal services provided to city departments. The fund specifically covers vehicle maintenance needs and fuel purchased for city vehicles. Technology Fund This fund accounts for the support all the city’s computers and hardware and software needs, including both the everyday operations and the replacement of equipment. 146 City of Glendale, Arizona Combining Statement of Net Position Non-Major Internal Service Funds June 30, 2021 (amounts expressed in thousands) Risk Management ASSETS Current assets: Equity in pooled cash and investments Receivables: Accounts Intergovernmental receivable Inventories and prepaid items Total current assets Noncurrent assets: Restricted Deposits Restricted cash and investments OPEB assets Capital assets: Capital Assets Accumulated Depreciation Capital assets, net Total noncurrent assets Total assets $ DEFERRED OUTFLOWS OF RESOURCES Debit amounts related to pensions and OPEB Total deferred outflows of resources Workers' Compensation 5,818 $ Employee Benefits 9,606 $ Fleet Services 10,219 $ Total Non-Major Internal Service Funds Technology 285 $ 9,757 $ 35,685 16 5,834 9,606 303 10,522 9 60 354 9,757 303 9 76 36,073 1 150 1 1,425 - 11 17 1,575 30 1 5,835 151 9,757 1,425 11,947 753 (714) 39 50 404 8,927 (4,191) 4,736 4,753 14,510 9,680 (4,905) 4,775 6,380 42,453 69 69 46 46 - 1,016 1,016 944 944 2,075 2,075 51 30 3,731 3,812 325 26 9,321 9,672 2,533 4,543 7,076 276 181 457 175 58 335 568 3,360 58 572 17,595 21,585 25 89 114 3,926 31 41 72 9,744 7,076 210 3,176 3,386 3,843 320 1,071 1,391 1,959 586 4,377 4,963 26,548 1 6 - 598 34 639 - - - 39 4,736 4,775 1 1,976 1,977 1 52 53 4,871 4,871 11 (3,071) (3,021) 17 8,708 13,461 30 12,536 17,341 LIABILITIES Current liabilities: Vouchers payable Accounts payable Compensated absences Estimated claims payable Total current liabilities Noncurrent liabilities: Compensated absences Net pension & OPEB liabilities Total noncurrent liabilities Total liabilities DEFERRED INFLOWS OF RESOURCES Credit amounts related to pensions and OPEB NET POSITION Net investment in capital assets Restricted for: OPEB benefits Unrestricted Total net position $ $ 147 $ $ $ $ City of Glendale, Arizona Combining Statement of Revenues, Expenses, and Changes in Net Position Internal Service Funds For the Year Ended June 30, 2021 (amounts expressed in thousands) OPERATING REVENUES Self insurance premium Charges for services Other fees Total operating revenues Risk Management $ OPERATING EXPENSES Administrative and general Insurance claims and premiums Amortization and depreciation Total operating expenses Operating income (loss) NONOPERATING REVENUES (EXPENSES) Investment Income Gain/(loss) on disposal of assets Total nonoperating revenues (expenses) Income (loss) before contributions and transfers Change in net position Total net position - beginning Total net position - ending $ 4,625 398 5,023 Workers' Compensation $ 4,850 2 4,852 Employee Benefits $ 29,305 20 29,325 Fleet Services $ Total Internal Service Funds Technology 9,370 9,370 $ 12,520 11 12,531 $ 38,780 21,890 431 61,101 2,201 1,778 3,979 1,044 838 4,064 4,902 (50) 248 28,817 29,065 260 9,332 13 9,345 25 9,940 361 10,301 2,230 22,559 34,659 374 57,592 3,509 75 75 1,119 1,119 858 1,977 110 110 60 60 (7) 53 108 108 368 368 4,503 4,871 25 25 (3,046) (3,021) 43 (11) 32 2,262 2,262 11,199 13,461 336 (11) 325 3,834 3,834 13,507 17,341 $ 148 $ $ $ $ City of Glendale, Arizona Combining Statement of Cash Flows Internal Service Funds For the Year Ended June 30, 2021 (amounts expressed in thousands) CASH FLOWS FROM OPERATING ACTIVITIES Cash received from customers Cash paid to internal city departments Cash paid to external vendors Cash paid for insurance and in settlement of claims Cash paid to employees for services Net cash provided (used) by operating activities Risk Management $ CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Proceeds from sale of capital assets Acquisition of capital assets and rights Net cash provided (used) by capital and related financing activities Reconciliation of operating income (loss) to net cash provided (used) by operating activities: Operating Income Adjustments to reconcile operating income (loss) to net cash provided (used) by operating activities: Amortization and depreciation Changes in assets and liabilities: Intergovernmental receivable Net OPEB asset Net pension and OPEB liability Deferred outflows related to pensions and OPEB Deferred inflows related to pensions and OPEB Inventories and prepaid items Vouchers and accounts payable Compensated absences Claims payable Net cash provided (used) by operating activities 5,023 (2) (1,931) (2,503) (254) 333 $ Employee Benefits 4,850 (2) (359) (2,285) (270) 1,934 $ Fleet Services 29,188 (28,575) 613 $ Total Internal Service Funds Technology 9,382 (349) (6,393) (2,561) 79 $ 12,531 (151) (6,533) (3,615) 2,232 $ 60,974 (504) (15,216) (33,363) (6,700) 5,191 - - - - (11) (614) (625) (11) (614) (625) $ 75 75 408 5,410 5,818 $ 111 111 2,045 7,561 9,606 $ 108 108 721 9,498 10,219 $ 79 206 285 $ 43 43 1,650 8,107 9,757 $ 337 337 4,903 30,782 35,685 $ 1,044 $ (50) $ 260 $ 25 $ 2,230 $ 3,509 CASH FLOWS FROM INVESTING ACTIVITIES Interest received from investments Net cash provided (used) by investing activities Net increase (decrease) in cash and cash equivalents Balances - beginning of year Balances - end of the year Workers' Compensation $ - - - 13 361 374 (1) 44 (24) (19) 8 7 (726) 333 (1) 31 (18) (15) 203 5 1,779 1,934 (135) 46 442 613 13 (7) 393 (222) (192) (19) 88 (13) 79 (10) 600 (333) (272) (489) 145 2,232 (122) (19) 1,068 (597) (498) 27 252 144 1,053 5,191 $ 149 $ $ $ $ City of Glendale, Arizona Budgetary Comparison Schedule Risk Management Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Budgeted Amounts Final Original 5,248 $ 5,248 Self insurance premium Investment Income Miscellaneous Total Revenues Amounts available for appropriation CHARGES TO APPROPRIATIONS (OUTFLOWS): Contingency Administrative and general Insurance claims and premiums Total charges to appropriations Budgetary fund balance, June 30 $ 5,367 Variance with Final Budget $ 119 4,505 20 100 4,625 9,873 4,505 20 100 4,625 9,873 4,625 75 398 5,098 10,465 120 55 298 473 592 1,000 2,194 2,431 5,625 750 2,244 2,631 5,625 2,191 2,504 4,695 750 53 127 930 4,248 150 $ Actual $ 4,248 $ 5,770 $ 1,522 City of Glendale, Arizona Budgetary Comparison Schedule Employee Benefits Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Self insurance premium Investment Income Miscellaneous Total Revenues Amounts available for appropriation CHARGES TO APPROPRIATIONS (OUTFLOWS): Administrative and general Insurance claims and premiums Total charges to appropriations Budgetary fund balance, June 30 $ Budgeted Amounts Original Final 14,501 $ 14,501 $ Actual 9,193 Variance with Final Budget $ (5,308) 32,458 32,458 46,959 32,458 32,458 46,959 29,305 108 20 29,433 38,626 (3,153) 108 20 (3,025) (8,333) 204 32,254 32,458 204 32,254 32,458 248 28,964 29,212 (44) 3,290 3,246 14,501 151 $ 14,501 $ 9,414 $ (5,087) City of Glendale, Arizona Budgetary Comparison Schedule Workers' Compensation Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Self insurance premium Investment Income Miscellaneous Total Revenues Amounts available for appropriation Budgeted Amounts Original Final 7,542 $ 7,542 7,590 $ Variance with Final Budget 48 4,724 26 4,750 12,292 4,724 26 4,750 12,292 4,850 110 2 4,962 12,552 126 84 2 212 260 1,000 1,292 3,459 5,751 1,000 1,292 3,459 5,751 835 2,285 3,120 1,000 457 1,174 2,631 CHARGES TO APPROPRIATIONS (OUTFLOWS): Contingency Administrative and general Insurance claims and premiums Total charges to appropriations Budgetary fund balance, June 30 $ Actual $ 6,541 152 $ 6,541 $ 9,432 $ 2,891 City of Glendale, Arizona Budgetary Comparison Schedule Fleet Services Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Budgeted Amounts Original Final $ Self insurance premium Miscellaneous Total Revenues Amounts available for appropriation CHARGES TO APPROPRIATIONS (OUTFLOWS): Administrative and general Total charges to appropriations Budgetary fund balance, June 30 $ $ 42 $ Variance with Final Budget 42 9,680 225 9,905 9,905 9,680 225 9,905 9,905 9,370 9,370 9,412 (310) (225) (535) (493) 9,905 9,905 9,905 9,905 9,372 9,372 533 533 - 153 - Actual $ - $ 40 $ 40 City of Glendale, Arizona Budgetary Comparison Schedule Technology Fund For the Year Ended June 30, 2021 (amounts expressed in thousands) Budgetary fund balance, July 1 RESOURCES (INFLOWS): $ Budgeted Amounts Final Original 3,329 $ 3,329 Self insurance premium Investment Income Miscellaneous Total Revenues Amounts available for appropriation CHARGES TO APPROPRIATIONS (OUTFLOWS): Contingency Administrative and general Capital Outlay Total charges to appropriations Budgetary fund balance, June 30 $ 7,364 Variance with Final Budget $ 4,035 12,520 12,520 15,849 12,520 12,520 15,849 12,520 43 11 12,574 19,938 43 11 54 4,089 99 14,650 1,100 15,849 99 14,650 1,100 15,849 10,245 188 10,433 99 4,405 912 5,416 - 154 $ Actual $ - $ 9,505 $ 9,505 This page left blank intentionally. City of Glendale, Arizona ANNUAL COMPREHENSIVE FINANCIAL REPORT _________________________________________________________ SUPPLEMENTARY INFORMATION ___________________________ FOR THE FISCAL YEAR ENDED JUNE 30, 2021 This page left blank intentionally. City of Glendale, Arizona Federal Financial Data Schedule (PHA: AZ003) For the Fiscal Year Ended June 30, 2021 (rounded to nearest dollar) 1 of 7 The following is the schedule of Federal Financial Data as required by the United States Department of Housing and Urban Development under the Uniform Financial Reporting Standards Rule implementing requirements of 24 CFR, Part 5, Subpart H. Balance Sheet Line Item No. 111 112 113 114 115 100 Account Description ASSETS: Current assets: Cash: Cash - unrestricted Cash - restricted - modernization and development Cash - other restricted Cash - tenant security deposits Cash - restricted for payment of current liability Total cash Project Total Housing Choice Vouchers PHC Public Housing CARES Act Funding $ $ $ 1,123,174 52,000 1,175,174 1,346,909 730,603 2,077,512 HCV CARES Act Funding - $ EHV Emergency Housing Voucher 263,711 263,711 $ 154,800 154,800 Resident Opportunity and Supportive Services Eliminations $ $ - - Total $ 2,624,883 994,314 52,000 3,671,197 121 122 124 125 126 126.1 126.2 127 128 128.1 129 120 Accounts receivables: Accounts receivable - PHA projects Accounts receivable - HUD other projects Accounts receivable - other government Accounts receivable - miscellaneous Accounts receivable - tenants Allowance for doubtful accounts - tenants Allowance for doubtful accounts - other Notes, loans, & mortgages receivable - current Fraud recovery Allowance for doubtful accounts - fraud Accrued interest receivable Total receivables, net of allowances for doubtful accounts 12,225 6,330 4,677 (1,709) 11,219 (11,219) 21,523 19,906 2,667 (2,667) 19,906 27,960 27,960 - - - - 19,906 40,185 6,330 4,677 (1,709) 13,886 (13,886) 69,389 131 132 135 142 143 143.1 144 145 150 Current investments: Investments - unrestricted Investments - restricted Investments - restricted for payment of current liability Prepaid expenses and other assets Inventories Allowance for obsolete inventories Inter program - due from Assets held for sale Total current assets 15,441 (772) 175,145 1,386,511 2,097,418 27,960 263,711 154,800 - (27,960) 15,441 (772) 147,185 3,902,440 155 (27,960) City of Glendale, Arizona Federal Financial Data Schedule (PHA: AZ003) For the Fiscal Year Ended June 30, 2021 (rounded to nearest dollar) 2 of 7 (continued) Balance Sheet Line Item No. 161 162 163 164 165 166 167 168 160 Account Description Notes, loans, & mortgages receivable - non-current Notes, loans, & mortgages receivable - non-current - past due Grants receivable - non-current Other assets Investment in joint venture Total non-current assets Total assets Deferred outflow of resources Total assets and deferred outflow of resources 311 312 313 321 322 324 325 331 332 333 341 342 343 344 345 346 347 348 310 LIABILITIES AND EQUITY-NET ASSETS/POSITION: LIABILITIES: Current liabilities: Bank Overdraft Accounts payable <= 90 days Accounts payable > 90 days past due Accrued wage/payroll taxes payable Accrued compensated absences - current portion Accrued contingency liability Accrued interest payable Accounts payable - HUD PHA Programs Accounts payable - PHA projects Accounts payable - other government Tenant security deposits Unearned revenues Total current portion of L/T debt - capital projects/mortgage revenue Current portion of L/T debt - operating borrowings Other current liabilities Accrued liabilities - other Inter program - due to Loan liability - current Total current liabilities HCV CARES Act Funding EHV Emergency Housing Voucher Resident Opportunity and Supportive Services Eliminations Project Total 135,533 11,281,189 589,718 203,309 2,377,945 (11,219,645) 298,357 3,666,406 149,998 102,908 (195,233) 57,673 - - - - - 135,533 11,431,187 589,718 306,217 2,377,945 (11,414,878) 298,357 3,724,079 2,915 3,669,321 5,055,832 144,814 5,200,646 4,671 62,344 2,159,762 232,011 2,391,773 27,960 27,960 263,711 $ 263,711 154,800 $ 154,800 $ - (27,960) (27,960) 7,586 3,731,665 7,634,105 376,825 8,010,930 27,960 27,960 $ $ $ Non-current assets: Capital assets: Land Buildings Furniture, equipment & machinery - dwellings Furniture, equipment & machinery - administration Leasehold improvements Accumulated depreciation Construction in progress Infrastructure Total capital assets, net of accumulated depreciation 171 172 173 174 176 180 190 200 290 PHC Public Housing CARES Act Funding Housing Choice Vouchers $ $ 59,611 10,067 52,000 6,058 127,736 $ $ 2,461 13,600 93,932 109,993 156 $ $ 263,711 263,711 - - $ $ (27,960) (27,960) Total $ $ 62,072 23,667 52,000 269,769 93,932 501,440 City of Glendale, Arizona Federal Financial Data Schedule (PHA: AZ003) For the Fiscal Year Ended June 30, 2021 (rounded to nearest dollar) 3 of 7 (continued) Balance Sheet Line Item No. Account Description 351 352 353 354 355 356 357 350 300 Noncurrent liabilities: Long-term debt, net of current - capital projects/mortgage revenue Long-term debt, net of current - operating borrowings Noncurrent liabilities - other Accrued compensated absences - noncurrent Loan liability - noncurrent FASB 5 liabilities Accrued pension and OPEB liabilities Total noncurrent liabilities Total liabilities 400 Deferred inflow of resources 508.4 511.4 512.4 513 600 EQUITY - NET ASSETS/POSITION: Net investment in capital assets Restricted net position Unrestricted net position Total equity - net assets/position Total liabilities, deferred inflow of resources and equity - net assets/position Project Total Housing Choice Vouchers PHC Public Housing CARES Act Funding HCV CARES Act Funding EHV Emergency Housing Voucher Resident Opportunity and Supportive Services Eliminations 90,607 786,208 876,815 1,004,551 23,770 122,399 1,259,611 1,405,780 1,515,773 27,960 263,711 - - (27,960) 23,770 213,006 2,045,819 2,282,595 2,784,035 42,033 67,343 - - - - - 109,376 3,666,406 487,656 4,154,062 5,200,646 57,673 706,833 44,151 808,657 2,391,773 27,960 $ 263,711 154,800 154,800 $ 154,800 - (27,960) 3,724,079 706,833 686,607 5,117,519 8,010,930 $ $ $ $ $ Total $ (continued) 157 City of Glendale, Arizona Federal Financial Data Schedule (PHA: AZ003) For the Fiscal Year Ended June 30, 2021 (rounded to nearest dollar) 4 of 7 (continued) Income Statement Line Item No. Account Description 70300 70400 70500 REVENUE: Net tenant rental revenue Tenant revenue - other Total tenant revenue 70600 70610 HUD PHA operating grants Capital grants 70710 70720 70730 70740 70750 70700 Management fee Asset management fee Bookkeeping fee Front line service fee Other fees Total fee revenue 70800 71100 71200 71300 71310 71400 71500 71600 72000 70000 Other government grants Investment income - unrestricted Mortgage interest income Proceeds from disposition of assets held for sale Cost of sale of assets Fraud recovery Other revenue Gain or loss on sale of capital assets Investment income - restricted Total revenue Project Total Housing Choice Vouchers PHC Public Housing CARES Act Funding $ $ $ $ 448,268 6,343 454,611 - - HCV CARES Act Funding EHV Emergency Housing Voucher Resident Opportunity and Supportive Services Eliminations $ $ $ $ - - - - Total $ 448,268 6,343 454,611 693,786 55,012 10,002,020 - 29,788 - 41,340 - 154,800 - - - 10,921,734 55,012 - - - - - - - - 704 20,013 1,224,126 1,226 1,322 2,644,647 $ 12,649,215 29,788 41,340 $ 154,800 32,336 32,336 - 32,336 1,930 1,322 2,664,660 $ 14,131,605 $ $ $ $ (continued) 158 City of Glendale, Arizona Federal Financial Data Schedule (PHA: AZ003) For the Fiscal Year Ended June 30, 2021 (rounded to nearest dollar) 5 of 7 (continued) Income Statement Line Item No. Account Description 91100 91200 91300 91310 91400 91500 91600 91700 91800 91810 91900 91000 EXPENSES: Administrative salaries Auditing fees Management fee Bookkeeping fee Advertising and marketing Employee benefit contributions - administrative Office expenses Legal expense Travel Allocated overhead Other Total operating - administrative 92000 92100 92200 92300 92400 92500 Asset management fee Tenant services - salaries Relocation costs Employee benefit contributions - tenant services Tenant services - other Total Tenant services 93100 93200 93300 93400 93500 93600 93700 93800 93000 94100 94200 94300 94500 94000 Project Total Housing Choice Vouchers PHC Public Housing CARES Act Funding HCV CARES Act Funding EHV Emergency Housing Voucher Resident Opportunity and Supportive Services Eliminations $ $ $ $ $ $ $ 290,466 48,819 18,325 94,816 452,426 658,983 437,299 43,997 700 86,376 1,227,355 3,724 711 11,490 15,925 34,811 6,349 180 41,340 - - - Total $ 987,984 493,178 73,812 700 181,372 1,737,046 - - - - - 19,365 8,160 4,811 32,336 - 19,365 8,160 4,811 32,336 Water Electricity Gas Fuel Labor Sewer Employee benefit contributions - utilities Other utilities expense Total utilities 112,763 16,095 1,487 40,754 171,099 - - - - - - 112,763 16,095 1,487 40,754 171,099 Ordinary maintenance and operations - labor Ordinary maintenance and operations - materials & other Ordinary maintenance and operations - contract costs Employee benefit contributions - ordinary maintenance Total maintenance 296,517 102,935 223,297 43,922 666,671 1,479 1,479 6,695 5,784 1,384 13,863 - - - - 303,212 110,198 223,297 45,306 682,013 $ $ $ $ $ $ $ $ (continued) 159 City of Glendale, Arizona Federal Financial Data Schedule (PHA: AZ003) For the Fiscal Year Ended June 30, 2021 (rounded to nearest dollar) 6 of 7 (continued) Income Statement Line Item No. Account Description Project Total Housing Choice Vouchers PHC Public Housing CARES Act Funding $ $ $ HCV CARES Act Funding EHV Emergency Housing Voucher Resident Opportunity and Supportive Services Eliminations $ $ $ $ Total 95100 95200 95300 95500 95000 Protective services - labor Protective services - other contract costs Protective services - other Employee benefit contributions - protective services Total protective services 96110 96120 96130 96140 96100 Property insurance Liability insurance Workmen's compensation All other insurance Total insurance premiums 48,050 13,112 61,162 9,730 9,730 - - - - - 48,050 22,842 70,892 96200 96210 96300 96400 96500 96600 96800 96000 Other general expenses Compensated absences Payments in lieu of taxes Bad debt - tenant rents Bad debt - mortgages Bad debt - other Severance expense Total other general expenses 9,638 9,638 8,034 8,034 - - - - - 8,034 9,638 17,672 96710 96720 96730 96700 Interest on mortgage (or bonds) payable Interest on notes payable (short and long term) Amortization of bond issue costs Total Interest expense and amortization cost - - - - - - - - 96900 Total operating expenses 1,360,996 1,246,598 29,788 41,340 - 32,336 - 2,711,058 (136,870) 11,402,617 - - 154,800 - - 11,420,547 97000 Excess of operating revenue over operating expenses - - - - - - - $ - 97100 97200 Extraordinary maintenance Casualty losses - non-capitalized - - - - - - - - 97300 Housing assistance payments - 8,882,518 - - - - - 8,882,518 262,066 1,623,062 2,416,083 4,061 $ 12,549,260 29,788 41,340 - 32,336 - 2,416,083 266,127 $ 14,275,786 97350 97400 97500 97600 97700 97800 90000 HAP Portability-in Depreciation expense Fraud losses Capital outlays - governmental funds Debt principal payment - governmental funds Dwelling units rent expense Total expenses $ $ $ $ $ $ (continued) 160 City of Glendale, Arizona Federal Financial Data Schedule (PHA: AZ003) For the Fiscal Year Ended June 30, 2021 (rounded to nearest dollar) 7 of 7 (continued) Income Statement Line Item No. Account Description 10010 10020 OTHER FINANCING SOURCES (USES) Operating transfers in Operating transfers out 10030 10040 10050 10060 10070 10080 10091 10092 10093 10094 10100 10000 Operating transfers from/to primary government Operating transfers from/to component unit Proceeds from notes, loans and bonds Proceeds from property sales Extraordinary items, net gain/loss Special items, net gain/loss Inter project excess cash transfer in Inter project excess cash transfer out Transfers between program and project - in Transfers between program and project - out Total other financing sources (uses) Excess (deficiency) of total revenues over (under) total expenses Project Total Housing Choice Vouchers PHC Public Housing CARES Act Funding $ $ $ $ 12,923 (12,923) 296,563 296,563 (102,373) $ - $ 90,000 90,000 189,955 - - HCV CARES Act Funding EHV Emergency Housing Voucher Resident Opportunity and Supportive Services Eliminations $ - $ $ $ $ 154,800 $ $ - $ - $ - $ - - - $ - $ - (12,923) 12,923 Total $ $ - $ $ - $ 386,563 386,563 242,382 MEMO ACCOUNT INFORMATION 11020 Required annual debt principal payments 11030 Beginning equity 4,099,005 708,702 - - - - - 4,807,707 11040 11050 11060 11070 11080 11090 11100 11170 11180 11190 11210 11270 Prior period adjustments, equity transfers & correction of errors Changes in compensated absence balance Changes in contingent liability balance Changes in unrecognized pension transition liability Changes in special term/severance benefits liability Changes in allowance for doubtful accounts - dwelling rents Changes in allowance for doubtful accounts - other Administrative fee equity Housing assistance payments equity Unit months available Unit months leased Excess cash 67,429 1,842 1,795 1,138,916 164,457 706,833 12,612 11,682 - - - - - - 67,429 164,457 706,833 14,454 13,477 1,138,916 11610 11620 11630 11640 11650 11660 13510 13901 Land purchases Building purchases Furniture & equipment - dwelling purchases Furniture & equipment - administrative purchases Leasehold improvements purchases Infrastructure purchases CFFP debt service payments Replacement housing factor funds 22,434 6,818 25,760 - - - - - - - 22,434 6,818 25,760 - $ 161 - - This page left blank intentionally. City of Glendale, Arizona ANNUAL COMPREHENSIVE FINANCIAL REPORT _________________________________________________________ STATISTICAL SECTION ___________________________ FOR THE FISCAL YEAR ENDED JUNE 30, 2021 This page left blank intentionally. STATISTICAL SECTION This part of the City of Glendale’s comprehensive annual financial report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the city’s overall financial health. Contents Pages Financial Trends These schedules contain trend information to help the reader understand how the city’s financial performance and well-being have changed over time. 162-168 Revenue Capacity These schedules contain information to help the reader assess the city’s local revenue source, the property tax and sales tax. 169-173 Debt Capacity 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. 174-180 Demographic and Economic Information These schedules offer demographic and economic indicators to help the reader understand the environment within which the city’s financial activities take place. 181-183 Operating Information 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. 184-188 City of Glendale, Arizona Net Position by Component Last Ten Fiscal Years (amounts expressed in thousands) Government activities Net investment in capital assets Restricted Unrestricted Total governmental activities net position 2021 $ 471,198 200,500 (162,270) 2020 $ 465,366 170,205 (193,716) 2019 $ 416,078 184,654 (215,449) 2018 $ 451,826 185,396 (246,697) 509,428 441,855 385,283 390,525 Business-type activities Net investment in capital assets Restricted Unrestricted Total business-type activities net position 397,187 37,992 39,451 362,679 33,896 32,618 313,704 32,943 53,699 280,920 27,550 78,272 474,630 429,193 400,346 386,742 Primary government Net investment in capital assets Restricted Unrestricted Total primary government net position 868,385 238,492 (122,819) 828,045 204,101 (161,098) 729,782 217,597 (161,750) 732,746 212,946 (168,425) $ 984,058 $ 871,048 $ 785,629 162 $ 777,267 Schedule 1 2017 $ $ 471,979 157,251 (278,767) 2016 $ 456,001 163,592 (239,670) 2015 $ 456,897 168,714 (240,749) 2014 $ 2013 448,083 161,027 (277,093) $ 438,366 186,106 (59,797) 2012 $ 460,639 183,829 (73,375) 350,463 379,923 384,862 332,017 564,675 571,093 267,111 22,897 83,920 256,488 21,576 96,300 253,134 24,090 92,357 256,164 22,300 123,699 251,765 12,264 161,999 262,554 12,921 139,934 373,928 374,364 369,581 402,163 426,028 415,409 739,090 180,148 (194,847) 712,489 185,168 (143,370) 710,031 192,804 (148,392) 704,247 183,327 (153,394) 690,131 198,370 102,202 723,193 196,750 66,559 724,391 $ 754,287 $ 754,443 $ 734,180 $ 163 990,703 $ 986,502 Schedule 2 City of Glendale, Arizona Changes in Net Position Last Ten Fiscal Years (amounts expressed in thousands) 2021 2020 2019 2018 2017 2016 2015 2014 2013 2012 Expenses Governmental activities: General government $ 47,850 $ 45,972 $ 56,530 $ 42,915 $ 61,373 $ 64,228 $ 60,490 $ 73,637 $ 37,447 $ 35,962 Public safety 166,243 165,030 158,883 134,977 166,790 132,498 127,870 116,070 115,694 112,689 Public works 30,451 31,211 30,232 25,072 24,768 24,859 21,482 20,524 19,230 18,435 Community services 35,751 28,378 28,010 30,885 33,752 32,796 31,311 30,796 33,831 39,478 - - - 3,290 3,930 4,262 4,980 5,895 5,655 6,828 50,283 43,436 44,992 20,976 21,848 21,219 19,180 25,207 20,000 20,045 Community environment Street maintenance Interest on long-term debt 22,056 24,133 26,181 24,916 27,827 27,932 32,106 34,808 42,413 41,913 Total governmental activities expenses 352,634 338,160 344,828 283,031 340,288 307,794 297,419 306,937 274,270 275,350 Water and sewer 90,604 87,212 83,603 81,911 83,500 80,375 74,807 77,243 73,460 78,917 Landfill 11,319 10,051 9,921 9,852 11,302 9,049 7,727 7,554 7,486 7,602 Solid Waste 19,310 18,351 17,242 15,150 15,698 15,016 15,059 14,471 16,122 15,437 Business-type activities: Housing Total business-type activities expenses Total primary government expenses 14,182 13,663 12,910 12,498 12,644 12,730 13,159 13,088 14,037 14,827 135,415 129,277 123,676 119,411 123,144 117,170 110,752 112,356 111,105 116,783 $ 488,049 $ 467,437 $ 468,504 $ 402,442 $ 463,432 $ 424,964 $ 408,171 $ 419,293 $ 385,375 $ 392,133 $ 23,415 $ 15,648 $ 16,572 $ 17,847 $ 15,027 $ 16,381 $ 18,498 $ 17,666 $ 12,520 $ 12,334 Program revenues Governmental activities: Charges for services: General government Public safety 3,860 3,803 4,126 2,295 5,445 6,148 6,084 6,369 5,778 Public works 3,969 4,478 3,883 651 536 650 631 1,126 1,149 5,624 512 Community services 1,909 2,995 4,318 10,890 13,490 9,649 11,704 10,486 11,003 17,910 - Community environment - - - 338 308 305 309 - - Street maintenance 33 124 207 662 357 193 25 - - - 57,903 50,999 30,906 26,523 27,519 26,225 25,665 25,168 25,156 27,636 Operating grants and contributions Capital grants and contributions Total governmental activities program revenues 18,112 33,570 12,728 12,382 6,669 6,603 11,403 10,748 7,904 5,274 109,201 111,617 72,740 71,588 69,351 66,154 74,319 71,563 63,510 69,290 164 2021 2020 2019 2018 2017 2016 2015 2014 2013 2012 Business-type activities: Charges for services: Water and sewer 103,533 89,208 86,004 86,288 80,219 81,829 78,541 81,065 81,963 Landfill 12,238 10,383 9,670 9,444 9,451 9,858 9,757 8,646 7,994 7,185 Solid Waste 19,854 19,048 18,080 16,048 14,856 15,181 14,944 14,836 14,791 14,562 Housing 82,730 3,123 2,984 3,527 3,355 2,876 2,980 3,265 3,504 4,137 4,886 Operating grants and contributions 11,462 10,866 9,397 9,682 10,230 9,809 8,855 9,357 9,376 9,423 Capital grants and contributions 3,211 5,816 3,940 2,054 2,815 815 2,562 2,423 831 705 Total business-type activities program revenues 153,421 138,305 130,618 126,871 120,447 120,472 117,924 119,831 119,092 119,491 Total primary government program revenues 262,622 249,922 203,358 198,459 189,798 186,626 192,243 191,394 182,602 188,781 Governmental activities (243,433) (226,543) (272,088) (211,443) (270,937) (241,640) (223,100) (210,760) (210,760) (206,060) Business-type activities Total primary government net expense 18,006 (225,427) $ 9,028 (217,515) $ 6,942 (265,146) $ 7,460 (203,983) $ (2,697) (273,634) $ 3,302 (238,338) $ 7,172 (215,928) $ 7,987 (202,773) $ 7,987 (202,773) $ 2,708 (203,352) 26,473 $ 25,718 $ 25,877 $ 25,519 $ 24,955 $ 24,531 $ 23,881 $ 23,577 $ 21,372 $ 20,232 Net (expense)/revenue $ General revenues and other changes in net position Governmental activities: Taxes: Property taxes $ Sales taxes 205,325 180,842 171,821 162,299 155,779 150,201 147,175 131,983 132,872 97,451 Unrestricted state shared sales tax 29,941 25,910 24,849 23,627 22,024 21,482 20,695 19,734 18,558 17,716 Unrestricted urban revenue sharing (state shared income tax) 36,069 32,419 29,876 30,456 29,378 27,297 27,446 25,271 23,159 19,135 11,976 10,643 10,647 10,166 9,458 9,351 8,664 8,086 7,586 7,277 (464) 5,931 1,919 (694) (253) 1,225 1,070 726 716 975 - - - - - - (688) 78 353 56 Miscellaneous 3,023 2,978 3,177 1,490 1,400 3,417 520 687 367 489 Transfers (1,337) (1,326) (1,320) (1,358) (1,264) (803) 39,198 (64) (641) (307) - - - - - - - - - (25,000) 311,006 283,115 266,846 251,505 241,477 236,701 267,961 210,078 204,342 138,024 Auto in-lieu taxes Investment earnings Gain (loss) on disposal of capital assets Special item Total governmental activities Business-type activities: Investment earnings 227 1,277 1,628 1,368 883 614 643 463 1,878 1,126 Gain (loss) on disposal of capital assets - - - - - - 127 167 43 (40) Loss on joint venture - - - - - - (3,329) - - - 25,867 17,216 3,714 2,628 114 63 86 67 70 72 Miscellaneous Transfers Total business-type activities Total primary government 1,337 1,326 1,320 1,358 1,264 803 (39,198) 64 641 307 27,431 19,819 6,662 5,354 2,261 1,480 (41,671) 761 2,632 1,465 $ 338,437 $ 302,934 $ 273,508 $ 256,859 $ 243,738 $ 238,181 $ $ 67,573 $ 56,572 $ 45,437 113,010 $ 28,847 85,419 226,290 $ $ (5,242) $ 40,062 $ (29,460) $ (4,939) $ 13,604 8,362 $ 12,814 52,876 $ (436) (29,896) $ 4,782 (157) 210,839 $ $ 44,861 $ (34,499) 10,362 206,974 $ 139,489 $ (682) $ 8,748 8,066 $ (6,418) $ (68,036) $ 10,619 4,201 $ 4,173 (63,863) Changes in net position Governmental activities Business-type activities Total primary government 165 Schedule 3 City of Glendale, Arizona Fund Balances - Governmental Funds Last Ten Fiscal Years (amounts expressed in thousands) 2021 General fund Nonspendable Restricted Committed Assigned Unassigned Total general fund All other governmental funds Nonspendable Restricted Committed Assigned Unassigned Total all other governmental funds $ $ $ $ 2020 6,143 10,047 66,822 54,511 137,523 $ 6,244 137,087 1,974 959 146,264 $ $ $ 2019 5,621 5,374 34,322 49,648 94,965 $ 6,171 107,088 1,734 569 (502) 115,060 $ $ $ 2018 2,933 5,604 5,685 43,523 57,745 $ 6,020 119,994 1,571 737 128,322 $ $ $ 2017 2,919 6,274 12,678 43,474 65,345 $ 5,810 118,991 2,548 430 (653) 127,126 $ 166 $ $ 2016 2,934 7,443 10,647 40,559 61,583 $ 5,861 91,908 2,295 170 (3,770) 96,464 $ $ $ 2015 2,940 8,495 12,483 35,226 59,144 $ 5,818 97,170 1,273 319 104,580 $ $ $ 2014 216 10,313 1,114 8,563 26,033 46,239 $ 5,768 99,970 1,945 107,683 $ $ $ 2013 600 688 1,554 (4,835) (1,993) $ 5,801 102,241 123 202 108,367 $ $ $ 2012 650 311 1,676 (14,438) (11,801) $ 5,774 103,772 115 144 109,805 $ $ $ 197 368 2,351 (29,565) (26,649) 5,829 117,964 129 82 124,004 This page left blank intentionally. Schedule 4 City of Glendale, Arizona Changes in Fund Balances - Governmental Funds Last Ten Fiscal Years (amounts expressed in thousands) 2021 Revenues Taxes and special assessments Licenses and permits Intergovernmental Local revenues Charges for services Fines and forfeitures Investment income (loss) Miscellaneous Total revenues $ 232,032 35,656 124,611 184 7,504 2,782 (380) 4,323 2020 $ 206,815 19,182 129,329 173 8,514 2,426 6,063 3,647 2019 $ 198,012 16,350 95,573 177 10,744 2,982 3,276 4,375 2018 $ 188,553 12,534 94,191 58 10,250 3,337 129 6,490 2017 $ 181,576 12,403 89,684 300 13,486 3,699 276 5,079 2016 $ 176,489 11,951 86,273 17 12,613 3,857 1,517 6,850 2015 $ 170,605 10,610 87,112 525 17,685 3,556 1,258 5,662 2014 $ 159,328 11,522 81,364 18 14,781 3,735 900 4,500 2013 $ 149,705 10,373 76,520 36 11,896 3,469 762 3,822 2012 $ 118,218 10,798 73,009 11,487 3,374 1,180 11,700 406,712 376,149 331,489 315,542 306,503 299,567 297,013 276,148 256,583 229,766 General government Public safety Public works Community services Community environment Street maintenance Miscellaneous Capital outlay Debt service: Principal Interest 29,294 151,271 15,298 30,512 38,389 28,068 30,174 146,573 16,164 23,514 31,772 23,525 43,615 146,166 15,674 23,772 34,053 24,663 30,961 139,287 11,400 31,954 3,621 10,861 42,652 29,531 131,576 9,484 30,659 3,979 11,195 39,053 34,671 126,498 9,429 28,461 4,285 10,260 27 59,189 33,494 114,143 8,673 26,379 4,977 7,951 5,791 20,949 29,666 108,397 7,463 25,536 5,826 8,352 2,323 14,662 16,065 103,610 7,859 27,966 5,554 8,305 4,617 13,980 18,147 100,368 7,709 33,597 6,703 8,311 1,782 19,634 36,020 25,604 61,450 27,681 39,706 29,654 29,359 28,300 46,456 30,704 35,650 30,382 37,251 32,870 30,043 35,628 26,441 43,038 24,947 42,515 Total expenditures Excess of revenues over (under) expenditures 354,456 360,853 357,303 328,395 332,637 338,852 292,478 267,896 257,435 263,713 52,256 15,296 (25,814) (12,853) (26,134) (39,285) 4,535 8,252 (852) (33,947) Expenditures 167 Other financing sources (uses) Refunding lease issued Discount on long-term debt Long-term debt issued Refunding bonds issued Payment to redeem lease Premium on long-term debt issued Proceeds from equipment disposal Proceeds from land sale Capital lease proceeds Proceeds from loans Payment to redeem/refunded bonds escrow agent Current bond refunding principal Current bond refunding interest Transfers in Transfers out Special item Total other financing sources (uses) Net change in fund balances Debt service as a percentage of noncapital expenditures $ 2021 2020 2019 2018 2017 2016 2015 13,700 2,277 366 6,500 54,047 (55,384) - 295 9,693 50,009 (51,335) - 15,385 1,983 238 3,125 56,739 (58,060) - 91,940 15,686 2,910 15,240 (77,139) 61,927 (63,287) - 19,330 2,391 - 27,285 33,830 4,948 329 6,615 7,353 209,255 35,751 2,650 - 174 8 (1,557) 239,875 19,779 589 - 8,665 898 546 - 48,450 (49,714) - (30,470) 84,460 (85,263) - (131,966) (110,145) (1,022) 240,694 (201,496) - 48,704 (48,768) - (256,054) 52,136 (53,267) - (9,320) 32,977 (33,919) (25,000) 21,506 8,662 19,410 47,277 20,457 49,087 43,721 118 1,501 (153) 73,762 18.88% $ 23,958 26.42% $ (6,404) 20.85% $ 34,424 20.18% $ (5,677) 26.28% $ 9,802 23.61% $ 48,256 25.82% 2014 $ 8,370 25.93% 2013 $ 649 28.54% 2012 $ (34,100) 27.64% Note: The debt service percentage of noncapital expenditures does not include other financing sources/uses. The percentage equals the total principal and interest expenditures divided by the total expenditures less capital outlay. 168 Schedule 5 City of Glendale, Arizona Assessed and Estimated Actual Value of Taxable Property Last Ten Fiscal Years (amounts expressed in thousands) Major Components Fiscal Year Real Estate Improvements Personal (3) Utilities Rails and Wires Less: Tax Exempt Property Net Assessed Value (1) Total Direct Tax Rate Estimated Actual Value(1) Assessed Value as a Percentage of Actual Value(2) 2011-12 330,057 1,189,718 49,391 53,746 473,388 1,149,524 1.59 12,040,482 13.479 % 2012-13 304,041 1,130,460 45,507 53,158 485,894 1,047,273 1.90 11,471,039 13.366 2013-14 316,206 1,213,829 41,750 53,581 477,258 1,148,108 2.29 12,489,163 13.014 2014-15 379,087 1,451,325 40,191 55,687 518,191 1,408,099 2.15 12,452,875 15.469 2015-16 403,055 1,546,186 40,431 59,918 529,361 1,520,229 2.20 13,046,428 15.708 2016-17 499,308 1,635,370 37,350 60,892 579,745 1,653,175 2.14 13,617,839 16.397 2017-18 535,252 1,771,647 49,605 60,918 596,446 1,820,976 2.07 19,526,518 12.380 2018-19 565,975 1,924,149 48,588 59,594 590,661 2,007,645 1.98 21,072,143 12.331 2019-20 645,653 2,100,805 47,258 60,722 673,484 2,180,954 1.86 23,159,054 12.325 2020-21 722,615 2,271,767 55,014 64,004 718,396 2,395,004 1.80 25,276,448 12.317 Source: Maricopa County Assessor's Office and Maricopa County's Department of Finance Notes: (1) Assessed values are established each year by the County. The tax rate is $100 per assessed value (reference note I. L). (2) The assessed value as a percentage of actual value does not include tax exempt property. (3) The Assessor's Office no longer breaks down the secured and unsecured personal property as of 2013. All prior years secured and unsecured have been combined. 169 Schedule 6 City of Glendale, Arizona Direct and Overlapping Governments Property Tax Rates Last Ten Fiscal Years Per $100 Assessed Valuation Overlapping Rates* City of Glendale Glendale Elementary and High School Districts Peoria Unified School Districts Deer Valley Unified School Districts Fiscal Year Basic Rate General Obligation Debt Service 2011-12 0.22 1.37 1.59 20.69 15.54 16.47 2012-13 0.22 1.68 1.90 22.93 18.08 17.75 2013-14 0.50 1.79 2.29 25.06 19.82 18.91 2014-15 0.49 1.66 2.15 23.58 19.64 18.85 2015-16 0.49 1.71 2.20 22.54 20.66 18.86 2016-17 0.48 1.67 2.15 23.29 20.82 19.16 2017-18 0.46 1.61 2.07 23.61 20.02 19.10 2018-19 0.44 1.54 1.98 22.17 18.96 18.63 2019-20 0.42 1.44 1.86 22.13 18.47 18.17 2020-21 0.40 1.40 1.80 21.20 17.91 17.56 Source: Maricopa County 2020 Tax Rates Note: The City rounds the rates to two digits from the four presented by the county. * Overlapping rates are those of local and county governments that apply to property owners within the City of Glendale. Not all overlapping rates apply to all City of Glendale property owners (e.g., the rates for special districts apply only to the proportion of the government's property owners whose property is located within the geographic boundaries of the special district). 170 Schedule 7 City of Glendale, Arizona Principal Property Taxpayers Current Year and Nine Years Ago June 30, 2021 (amounts expressed in thousands) Tax Year 2021 Taxpayer Yam Westgate LLC Arizona Public Service Company VHS of Arrowhead, Inc. RRB Beverage Operations Inc Arrowhead Towne Center LLC Wal-Mart Stores, Inc. Outlets At Westgate LLC Mark Anthony Brewing Inc American Furniture Warehouse Co Reserve at Arrowhead LLC New Westgate LLC JQH-Glendale Az Development LLC Qwest Corporation (CenturyLink) Stadium Development LLC BNSF Railway Corporation Southwest Gas Corporation Total principal taxpayers Rank 1 2 3 4 5 6 7 8 9 10 $ $ Assessed Valuation 25,366 18,900 15,261 14,053 12,759 11,078 11,058 10,643 9,689 8,182 Tax Year 2012 Percentage of Total City Taxable Assessed Value 1.06 % 0.79 0.64 0.59 0.53 0.46 0.46 0.44 0.40 0.34 136,989 5.71 % Assessed Valuation Rank 1 3 $ 17,785 12,016 1.55 % 1.05 4 6 11,416 8,275 0.99 0.72 2 5 7 8 9 10 12,584 8,380 7,724 5,297 4,162 3,331 1.09 0.73 0.67 0.46 0.36 0.29 90,970 7.91 % $ Source: Maricopa County Treasurer's Office Notes: The Salt River Project Agriculture Improvement and Power District assessed valuation is not reflected in the total assessed valuation of the City of Glendale. The Project is subject to "voluntary contribution" in lieu of ad valorem taxation. The percentage of Total City Taxable Assessed Value is based on the Net Assessed Value. 171 Percentage of Total City Taxable Assessed Value Schedule 8 City of Glendale, Arizona Property Tax Levies and Collections Last Ten Fiscal Years (amounts expressed in thousands) Collected within the Fiscal Year of Levy Total Collections to Date Collections Fiscal Year 2011-12 Total Percent of (1) Tax Levy $ 20,787 Amount $ in Subsequent Percent of (2) Years Levy 20,090 96.65 % $ Amount 63 $ Levy 20,153 96.95 % 2012-13 21,841 21,268 97.38 (10) 20,194 92.46 2013-14 23,943 23,490 97.38 141 23,631 98.70 2014-15 24,429 23,729 98.11 237 23,966 98.10 2015-16 24,850 24,255 97.61 221 24,476 98.49 2016-17 25,253 24,638 97.56 369 25,007 99.03 2017-18 25,592 25,202 98.48 287 25,489 99.60 2018-19 25,953 25,521 98.34 165 25,686 98.97 2019-20 25,831 25,300 97.94 393 25,693 99.47 2020-21 26,619 26,039 97.82 26,039 97.82 Source: Maricopa County Treasurer's Office (1) Total levy includes only secured property. (2) Includes collections and resolutions. 172 Schedule 9 City of Glendale, Arizona City Transaction Privilege Taxes (Sales Tax) by Category Last Ten Fiscal Years (amounts expressed in thousands) 2021 2020 2019 2018 2017 2016 2015 2014 2013 2012 Retail sales Contracting Rentals Utilities Telecom/cable TV Restaurant/bar Amusement Other $ 118,580 17,047 22,064 9,271 2,364 23,184 2,975 9,827 $ 100,561 13,988 21,407 8,629 3,029 20,883 2,893 9,364 $ 95,042 7,212 20,598 8,898 3,006 22,280 5,023 9,519 $ 89,762 6,684 18,629 8,995 3,486 20,498 4,920 8,574 $ 88,804 5,559 17,394 8,775 3,523 20,070 3,615 7,347 $ 84,710 4,810 16,581 8,544 4,244 18,767 4,176 8,802 $ 79,062 6,457 16,146 8,678 4,773 17,651 5,673 6,686 $ 73,924 7,948 14,502 8,732 5,072 15,842 2,110 5,808 $ 67,157 5,724 14,182 8,028 5,540 14,284 2,154 5,917 $ 49,686 5,170 11,550 6,393 5,144 11,975 2,896 3,816 Total $ 205,312 $ 180,754 $ 171,578 $ 161,548 $ 155,087 $ 150,634 $ 145,126 $ 133,938 $ 122,986 $ 96,630 % Growth by year Retail sales Contracting Rentals Utilities Telecom/cable TV Restaurant/bar Amusement Other 17.9 % 21.9 3.1 7.4 (22.0) 11.0 2.8 4.9 5.8 % 94.0 3.9 (3.0) 0.8 (6.3) (42.4) (1.6) 5.9 % 7.9 10.6 (1.1) (13.8) 8.7 2.1 11.0 1.1 % 20.2 7.1 2.5 (1.1) 2.1 36.1 16.7 4.8 % 15.6 4.9 2.7 (17.0) 6.9 (13.4) (16.5) 7.1 % (25.5) 2.7 (1.5) (11.1) 6.3 (26.4) 31.6 7.0 % (18.8) 11.3 (0.6) (5.9) 11.4 168.9 15.1 10.1 % 38.9 2.3 8.8 (8.4) 10.9 (2.0) (1.8) 3.3 % (23.3) (2.6) (0.9) (15.6) 6.9 55.7 (31.5) (2.0) % 51.0 (7.0) (6.0) (1.0) 4.0 (50.0) 39.0 Total 13.6 % 5.3 % 6.2 % 4.2 % 3.0 % 3.8 % 8.4 % 8.9 % 27.3 % (1.3) % Note: The 2012 and prior years tax rate for City activities is 2.2% except for telecommunications which is 5.4%, restaurant bars 3.2%, hotel/motel 5.6%, and retail sales food for home consumption 1.8%. The 2013 and later years tax rate for City activities is 2.9% except for telecommunications which is 6.1%, restaurant/bars 3.9%, hotel/motel 7.9%, retail sales food for home consumption 2.5%, and retail sales of individual items over $5,000 2.2%. The amounts represent sales tax dollars collected for the fiscal year presented. 173 This page left blank intentionally. Schedule 10 City of Glendale, Arizona Ratio of Outstanding Debt by Type(1) Last Ten Fiscal Years (amounts expressed in thousands) Fiscal Year General Obligation Bonds(4) Government Activities Street and Highway Revenue Bonds(4) Excise Tax Revenue Bonds Transportation Bonds Capital Leases Notes Payable 2011-12 179,010 12,250 474,840 97,035 11,667 - 2012-13 163,130 8,055 468,875 91,140 11,094 - 2013-14 151,206 (5) 3,736 (5) 477,736 (4) (5) 89,317 (4) (5) 10,361 - 2014-15 133,168 (5) 1,912 (5) 477,747 (4) (5) 91,047 (4) (5) 57 - 2015-16 141,553 (5) - (5) 475,918 (4) (5) 87,031 (4) (5) 6,620 5,515 2016-17 125,384 (5) - (5) 468,431 (4) (5) 83,119 (4) (5) 4,484 3,677 2017-18 154,834 (5) - (5) 455,495 (4) (5) 78,590 (4) (5) 2,278 1,839 2018-19 152,066 (5) - (5) 439,912 (4) (5) 73,952 (4) (5) - - 2019-20 107,678 (5) - (5) 422,679 (4) (5) 69,209 (4) (5) - - 2020-21 106,367 (5) - (5) 403,550 (4) (5) 64,691 (4) (5) - - 174 Business Activities Water Sewer Revenue Bonds Fiscal Year Water Sewer G.O. Bonds Landfill G.O. Bonds 2011-12 6,485 - 282,625 708 - 1,064,620 (1) 4,694 13.27 2012-13 5,515 (4) - 273,080 - - 1,020,889 (1) 4,471 12.21 2013-14 - (4) - 267,254 (4) (5) - - 999,610 (5) 4,327 11.52 2014-15 - - 260,967 (4) (5) - - 964,898 (5) 4,141 10.18 2015-16 - - 249,302 (4) (5) - - 965,939 (5) 4,255 10.81 2016-17 - - 237,247 (4) (5) - - 922,342 (5) 3,875 9.14 2017-18 - - 222,217 (4) (5) - - 915,253 (5) 3,814 9.18 2018-19 - - 203,917 (4) (5) - - 869,847 (5) 3,466 8.07 2019-20 - - 185,231 (4) (5) - - 784,797 (5) 3,090 6.48 2020-21 - - 197,234 (4) (5) - - 771,842 (5) 3,003 6.04 Notes Payable Total Primary Government Capital Leases Total Debt per Capita(3) Percentage of Personal Income(2) (1) Does not include other long-term obligations such as compensated absences, unamortized premiums, claims/judgments, arbitrage, post-closure costs, etc. (2) Calculate by dividing Glendale population with Maricopa County population and multiplying by total personal income to arrive at Glendale personal income (data from Schedule 15). Then divide total primary government amount by Glendale personal income to arrive at percentage of personal income. (3) Numbers not expressed in thousands. (4) Amounts outstanding less July 1. (5) Includes unamortized premiums of debt issuance and discount on debt issuance. 175 Schedule 11 City of Glendale, Arizona Ratios of Net General Bonded Debt Outstanding Last Ten Fiscal Years (amounts expressed in thousands) Fiscal General Obligation Less: Amounts Available in Debt Service Year Bonds(4) Funds(2) Secondary Assessed Limited Property Total Property Value Value Percentage of Net Assessed Per Value of Property(6) Capita(3) 2011-12 185,495 (1) 16,765 168,730 1,149,264,817 N/A 14.68 744.22 2012-13 168,645 (1) 12,641 156,004 1,050,893,890 N/A 14.90 681.22 2013-14 147,810 9,310 138,500 1,148,164,650 N/A 12.06 599.28 2014-15 126,305 8,270 118,035 1,406,062,309 N/A 10.43 507.29 2015-16 135,130 4,511 130,619 N/A 1,173,091,035 11.12 (5) 556.38 2016-17 120,000 3,657 116,343 N/A 1,227,220,727 7.04 (5) 488.84 2017-18 146,985 31,750 115,235 N/A 1,306,946,089 8.82 (5) 480.43 2018-19 143,460 28,593 114,867 N/A 1,413,253,839 8.13 (5) 458.18 (7) 2019-20 100,445 1,545 98,900 N/A 1,478,280,140 6.69 (5) 389.24 (7) 2019-21 98,230 2,269 95,961 N/A 1,582,239,446 6.19 (5) 381.74 (7) Sources: Maricopa County - Abstract by tax authority and class ADOA Office of Employment and Population Statistics - Population estimates Notes: (1) Includes general obligation water and sewer bonds. (2) Includes the general obligation debt service fund balance at June 30. (3) Per capita is in actual dollars. Population estimates per ADOA. (4) Includes the July 1 payment. (5) In accordance with Proposition 117, The Arizona Property Tax Assessed Valuation Amendment , property taxes are calculated based on limited assessed value instead of secondary full cash value beginning with tax year 2015. (6) Calculation uses the February State Abstract. (7) Calculation uses projected population figure from City of Glendale Annual Budget Book 176 Schedule 12 City of Glendale, Arizona Net Direct and Overlapping Governmental Activities Debt June 30, 2021 (amounts expressed in thousands) Net Debt Percentage Applicable Amount Applicable Outstanding to Glendale to Glendale (2) $ 207,770 23.4774 % $ Glendale Elementary School District No. 40 31,510 99.1908 31,255 Deer Valley Unified School District No. 97 198,940 18.3086 36,423 Alhambra Elementary School District No. 68 26,700 18.3348 4,895 Glendale Union High School District No. 205 89,535 23.1272 20,707 - 3.5463 - Maricopa County Community College District 312,450 3.5463 11,080 Phoenix Union High School District No. 210 394,405 1.2502 4,931 Pendergast Elementary School District No. 92 42,225 24.9548 10,537 Tolleson Union High School District No. 214 169,815 7.1038 12,063 Washington Elementary School District No. 6 96,320 3.0699 2,957 Dysart Unified School District No. 89 111,671 1.3044 1,457 Agua Fria Union High School District No. 216 132,210 0.4873 644 Litchfield Elementary School District No. 79 41,220 0.7502 309 Cartwright Elementary School District No. 83 19,355 - Jurisdiction Peoria Unified School District No. 11 Maricopa County 48,779 - Total Overlapping Debt 1,874,126 186,037 (1) 572,221 572,221 City of Glendale Debt Total $ 2,446,347 $ 758,258 Source: Maricopa County - Abstract by tax authority and class, Abstract by tax area code and Annual Report of Bonded Indebtedness. (1) The City of Glendale debt includes total General Obligation (GO) and governmental revenue bonds debt outstanding, capital leases, notes payable, settlement obligation, bond premiums and discounts, less debt service fund balances for current year. (2) Calculation based on Net Debt Outstanding multiplied by Percentage Applicable to Glendale, which is determined by dividing the tax area code net secondary assessed value by the tax authority net secondary assessed value. (3) The Net Debt Outstanding source is Arizona Open Book's Report of Outstanding Indebtedness for the most recent fiscal year available. 177 Schedule 13 City of Glendale, Arizona Legal Debt Margin Information Last Ten Fiscal Years (amounts expressed in thousands) Legal Debt Margin Calculation for Fiscal Year 2021 6% Type Bonds Assessed value Debt limit (6% of assessed value) Debt applicable to limit: General obligation bonds Less: Amount set aside for repayment of general obligation debt Total net debt applicable to limit Legal debt margin (1) (1) 2012 2013 2014 Debt limit Total net debt applicable to limit $ 68,971 $ 62,836 11,455 Legal debt margin Total net debt applicable to the limit as a percentage of debt limit (1) (1) (2) 2015 2016 $ 68,886 $ 67,877 7,309 2,415 $ 57,516 $ 55,527 16.61% 11.63% (1)(2)(3)(4) (1)(2)(3)(4) 2019 78,417 $ 2017 2018 $ 70,496 $ 73,633 $ (165) 10,580 10,580 $ 66,471 $ 68,042 $ 59,916 $ 63,053 3.51% -0.24% 15.01% 14.37% 20% Type Bonds (1)(2)(3)(4) 2020 84,795 $ 7,978 $ 70,439 $ 75,993 10.17% (1) (1) 88,697 $ 9,039 $ 79,658 10.38% 135,186 10.19% 5.92% $ $ 2,395,004 479,001 97,667 (2,083) 95,584 383,417 2019 (1)(2)(3)(4) 2020 (1)(2)(3)(4) 2021 $ 234,986 $ 245,444 $ 261,389 $ 282,651 $ 295,656 $ 118,200 120,039 105,763 $ 93,537 $ 108,057 $ 114,947 $ 139,681 59.26% 52.24% 51.08% 43.09% 2016 Debt limit Total net debt applicable to limit $ 229,905 $ 209,455 $ 229,622 $ 226,257 159,306 148,695 136,085 Legal debt margin $ 70,599 $ 60,760 69.29% 70.99% (1)(2)(3)(4) $ (1)(2)(3)(4) 2015 (1)(2)(4) 8,514 2018 2014 (1) (2) 143,700 2017 2013 (1) (1)(2)(3)(4) 2021 8,802 $ 2,395,004 143,700 8,700 (186) 8,514 135,186 (1)(2)(3)(4) Assessed value Debt limit (20% of assessed value) Debt applicable to limit: General obligation bonds Less: Amount set aside for repayment of general obligation debt Total net debt applicable to limit Legal debt margin 2012 Total net debt applicable to the limit as a percentage of debt limit (1)(2)(4) $ 107,257 $ 154,132 41.03% 106,065 $ 176,586 37.53% (1) Debt applicable to limit: General obligation bonds net of July 1 payment made prior to June 30. (2) FY 2012-FY 2014, based on secondary full cash value, FY 2015-FY2020, based on limited assessed value, starting in FY 2021, based on full cash value. (3) Beginning in FY 2017, the assessed value is from Maricopa County Assessor's Office February State Abstract report (4) In FY 2020, adjusted debt applicable to limit by moving the General Obligation Bond 2016B from 20% to 6% 178 (1)(2)(3)(4) 89,861 $ 205,795 30.39% 479,001 95,584 $ 383,417 19.95% This page left blank intentionally. Schedule 14 City of Glendale, Arizona Pledged-Revenue Coverage Last Ten Fiscal Years (amounts expressed in thousands) Water and Sewer Revenue Bonds Net Debt Service Available Revenue Principal Interest Fiscal Year Utility Service Charges(1) Less: Operating Expenses(2) 2011-12 83,496 41,555 41,941 9,545 (5) 13,306 (3) 1.84 2012-13 83,454 39,203 44,251 9,755 13,152 1.93 2013-14 81,733 42,544 39,189 10,210 12,706 1.71 2014-15 79,325 41,712 37,613 13,170 10,918 1.56 2015-16 83,088 45,431 37,657 9,415 10,719 1.87 2016-17 83,442 49,005 34,437 9,805 10,321 1.71 2017-18 90,844 50,962 39,882 12,780 9,860 1.76 2018-19 96,012 52,151 43,861 16,050 9,398 1.72 2019-20 111,854 55,576 56,278 16,435 8,646 2.24 2020-21 130,218 58,792 71,426 16,585 7,550 2.96 179 Coverage Transportation Bonds Fiscal Year Transportation Sales Tax 2011-12 20,665 2,890 4,437 2.82 100,081 (6) 2,590 (5) 27,279 2012-13 21,691 3,005 4,321 2.96 131,931 (6) 2,790 (5) 30,713 2014-15 23,112 3,125 4,201 3.15 141,674 (6) 6,500 22,951 4.81 2014-15 24,690 3,545 3,597 3.46 151,963 (6) 2,585 21,175 6.40 2015-16 25,566 3,380 3,763 3.58 156,210 (6) 10,025 20,984 5.04 2016-17 26,362 3,550 3,594 3.69 160,534 (6) 5,075 21,033 6.15 2017-18 27,571 3,925 3,114 3.92 170,484 (6) 6,580 19,542 6.53 2018-19 29,231 4,035 2,999 4.16 169,868 (6) 12,645 20,104 5.19 2019-20 30,989 4,140 2,893 4.41 179,289 (6) 14,295 19,556 5.30 2020-21 35,329 3,915 2,785 5.27 206,532 (6) 16,190 18,946 5.88 Debt Service Principal Interest Coverage Excise Tax Revenue Excise Tax Revenue Bonds (4) Debt Service Principal Interest Source: City of Glendale Finance Department Notes: (1) Operating revenues and nonoperating revenues excluding non-cash contributions, gains and losses and opeb income/(loss). (2) Excluding depreciation. (3) Principal and interest amounts include debt service on the note payable to the Water Infrastructure Financing Authority of Arizona for the 00-01 loan and the 09-10 loan for fiscal years through 2011-12. (4) Excise tax revenue bonds include the Municipal Property Corporation and the Western Loop 101 Public Facilities Corporation (FY 2009-10 to FY 2012-13). (5) Excluding reductions to principal by refunded bonds - 2011-12 Water & Sewer Revenue Bond $74,050 and Excise Tax Revenue Bonds $8,945; and 2012-13 Excise Tax Revenue Bonds $243,250. (6) Excise tax revenue amounts include state shared revenues. (7) Includes interest expense from refunding the Western Loop 101 Public Facilities Bonds in December 2012. 180 Coverage 3.35 (7) 3.94 Schedule 15 City of Glendale, Arizona Demographic and Economical Statistics Last Ten Fiscal Years (amounts expressed in thousands) Fiscal City of Glendale Maricopa County Year Population(2) Population(6) Personal Income 2011-12 229 (5) 3,885 156,763,179 40,350 8.6 2012-13 231 (5) 3,934 160,497,824 40,798 7.6 2013-14 233 (5) 3,945 167,439,604 42,443 6.6 2014-15 233 (5) 4,064 175,437,829 43,169 5.6 2015-16 227 4,153 185,111,698 44,573 5.6 2016-17 238 4,233 193,307,100 (3)(10) 45,667 4.9 (8) 2017-18 240 (7) 4,316 205,848,000 (3)(10) 47,694 4.3 (8) 2018-19 251 (9) 4,367 217,036,641 (3)(10) 49,704 (3) 4.8 (8) 2019-20 254 (9) 4,367 (3) 217,036,641 (3)(10) 49,704 (3) 10.2 (8) 2020-21 257 (9) 4,368 (3) 217,036,641 (3)(10) 49,704 (3) 7.4 (8) (1) Per Capita Personal Unemployment Income(1)(4) Rate (5) Note: (1) Personal Income and Per Capita Income figures are for Maricopa County. City of Glendale is one of several Valley cities that comprise Maricopa County, including Phoenix, Mesa and Scottsdale. (2) Estimate provided by City of Glendale Planning Department. (3) The previous fiscal year Maricopa County CAFR provides the most current number. (4) Calculation based on personal income divided by Maricopa County population. (5) Estimate provided by Arizona Department of Administration, Office of Employment and Population Statistics website for the prior fiscal year. (6) Maricopa County population extracted from Maricopa County CAFR statistical section. (7) Estimate from the Arizona Office of Economic Opportunity website, Arizona population estimates, for the fiscal year as of July 1. (8) Unemployment rate from the Arizona Office of Economic Opportunity website, LAUS data. (9) Estimate from the City of Glendale Annual Budget Book for the following fiscal year. (10) Personal Income is calculated based on most current information available from the Maricopa County CAFR. 181 Schedule 16 City of Glendale, Arizona Principal Employers Current Year and Nine Years Ago 2012 2021 Employer Employees Rank Percentage of Total City Employment Employees Rank Percentage of Total City Employment Luke Air Force Base 6,900 1 5.18 % 6,325 1 5.46 % Banner Thunderbird Health System 3,000 2 2.25 2,866 2 2.47 Arrowhead Towne Center 2,650 3 1.99 Westgate 2,000 4 1.50 Deer Valley Unified School District 1,747 5 1.31 1,432 8 1.24 Glendale Community College 1,745 6 1.31 2,000 4 1.73 City of Glendale 1,726 7 1.30 1,725 6 1.49 Glendale Union High School District 1,693 8 1.27 2,008 5 1.73 Tanger Outlets 1,562 9 1.17 Glendale Elementary School District 1,514 10 1.14 1,684 7 1.45 Walmart 2,175 3 1.88 CSAA/AAA 1,325 9 1.14 959 10 0.83 Arrowhead Community Hospital Total 24,537 18.42 % Source: City of Glendale Economic Development Department Department of Economic Security, Research Administration City of Glendale Human Resources Department 182 22,499 19.42 % Schedule 17 City of Glendale, Arizona Full-Time Equivalent City Government Employees by Function/Program Last Ten Fiscal Years Function/Program 2021 2020 2019 Full-Time Equivalent Employees as of June 30 2018 2017 2016 2015 2014 2013 2012 General government Management services Finance Planning Building Legal Other Police Fire Community service Parks and recreation Library Public works Engineering Transportation Utilities Total 31.00 62.00 12.00 25.00 70.00 69.00 549.00 287.00 65.00 55.00 36.00 164.00 32.00 80.00 189.00 1,726.00 26.00 61.00 11.00 22.00 75.00 71.00 563.00 283.00 68.00 53.00 36.00 168.00 31.00 85.00 199.00 1,752.00 22.00 56.00 10.00 24.00 71.00 72.00 551.00 278.00 59.00 51.00 37.00 156.00 29.00 77.00 195.00 1,688.00 27.00 57.00 12.00 24.00 73.00 70.00 529.00 276.00 53.00 68.00 35.00 188.00 26.00 60.00 185.00 1,683.00 31.00 49.00 10.00 21.00 69.00 63.00 534.00 253.00 48.00 59.00 32.00 173.00 17.00 57.00 176.00 1,592.00 34.00 54.00 13.00 21.00 67.00 73.00 505.00 260.00 56.00 75.00 32.00 165.00 18.00 60.00 172.00 1,605.00 36.00 57.00 14.00 24.00 66.00 77.00 534.00 269.00 60.00 92.00 48.00 179.00 19.00 65.00 185.00 1,725.00 29.00 55.00 14.00 22.00 71.00 68.00 530.00 282.00 54.00 73.00 35.00 183.00 24.00 59.00 186.00 1,685.00 Sources: City of Glendale Human Resources Department and Munis HCM system 183 28.00 53.00 13.00 22.00 67.00 68.00 522.00 262.00 55.00 66.00 34.00 184.00 18.00 57.00 184.00 1,633.00 24.00 56.00 11.00 22.00 69.00 66.00 517.00 259.00 57.00 58.00 31.00 180.00 19.00 56.00 185.00 1,610.00 Schedule 18 City of Glendale, Arizona Operating Indicators by Function/Program Last Ten Fiscal Years Function/Program Police Calls for service Bookings Criminal offense reports Fire EMS calls Fire calls Water (4) Number of billed accounts Water produced (million gallons) Sewer (4) Number of billed accounts Treated influent (million gallons) 2021 2020 2019 2018 Fiscal Year 2017 2016 2015 2014 2013 2012 181,576 4,753 28,856 179,469 6,310 29,306 185,857 10,056 35,867 192,877 11,037 30,146 (3) 187,645 9,030 30,146 190,074 8,445 32,732 174,535 17,871 31,873 146,538 18,939 31,481 127,333 8,588 34,995 127,829 7,083 33,938 34,851 5,827 36,695 3,948 35,939 3,395 35,482 3,661 31,502 3,093 34,518 3,371 32,250 3,467 30,262 3,461 30,082 3,478 29,321 3,495 63,109 14,787 62,440 13,398 62,105 12,826 61,463 13,755 61,270 13,672 60,921 13,864 60,679 12,057 60,436 13,768 60,062 13,667 59,633 14,064 58,710 5,983 58,114 6,295 57,804 6,025 57,206 6,045 57,037 6,289 56,700 6,229 56,491 6,117 56,313 6,244 55,980 6,065 55,528 5,970 53,563 38,650 52,903 40,114 49,479 40,791 46,338 39,744 48,346 41,026 48,971 46,086 48,993 45,693 45,942 41,879 46,833 40,272 48,187 39,722 83,452 90,953 89,614 86,187 75,561 78,977 74,217 70,679 76,390 80,416 8,844 7,171 6,217 5,804 6,234 5,488 5,449 4,799 6,383 5,304 504,461 499,106 494,325 498,092 514,197 568,653 528,835 408,516 415,695 446,010 43,670 47,273 66,174 69,934 71,912 74,256 77,318 78,271 85,798 90,577 (5) Refuse collection Residential curb service (tons per year) Commercial container service (tons per year) Airport (1) Departures/arrivals General government Building permits Library (2) Volumes in collection Transit Dial-A-Ride passengers Source: Various city departments and FAA ATADS report Note: Water and sewer statistics are contained in Schedule 20 and 21. (1) Departures/arrivals are based on fiscal year. (2) Includes all formats: books, magazines, CD's, DVD's and electronic/downloadable collection. (3) FY2018 criminal offense reports figure same as FY2017 due to PD rebuilding data views. (4) Water and sewer numbers updated to exclude duplicate account number. (5) Refuse collection excludes bulk and Phoenix reciprocal trash. 184 Schedule 19 City of Glendale, Arizona Capital Asset Statistics by Function/Program Last Ten Fiscal Years Function/Program Police Stations Patrol vehicles Fire stations General government City square miles Water Treatment capacity (millions gallons per day) Storage capacity (millions gallons) Miles of water mains Sewer Treatment capacity (millions gallons per day) Miles of sewer lines Landfill Landfill capacity - south cell Landfill capacity used - south cell Other public works Streets (miles) Parks and recreation Number of parks/retention basins/facilities Acres of parks Transit Dial-A-Ride minibuses 2021 2020 2019 2018 Fiscal Year 2017 2016 2015 2014 2013 2012 3 212 9 3 218 9 3 217 9 3 194 9 3 183 9 3 193 9 3 178 9 3 176 9 3 139 9 3 154 9 62 62 60 60 60 60 59 59 59 59 104.1 67 994 104.1 67 994 104.1 67 994 104.1 67 994 104.1 67 994 104.1 67 994 104.1 67 994 104.1 67 994 104.1 67 994 104.1 67 994 29.2 707 29.2 707 29.2 707 29.2 707 29.2 707 29.2 707 29.2 707 29.2 707 29.2 707 29.2 700 24,607 22,468 24,638 21,976 24,215 21,436 24,234 20,983 24,215 20,575 24,215 20,137 22,429 19,687 21,493 19,220 21,218 18,849 22,065 19,257 748 748 748 748 748 718 718 718 718 717 110 2,189 102 2,192 102 2,192 102 2,192 102 2,192 101 2,192 100 2,189 100 2,189 100 2,189 100 2,189 21 21 21 22 22 20 22 20 21 21 Source: Various city departments Note: Landfill capacity in thousands 185 Schedule 20 City of Glendale, Arizona Miscellaneous Water and Sewer Rate Statistics June 30, 2021 WATER RATES PER METER SIZE Meter Size (inch) Commercial and Residential Monthly Base Charge Inside Outside City City 5/8" 3/4" 3/4" 1" 1 1/2" 2" 3" 4" 6" 8" 10" 12" 12.00 15.20 21.60 43.70 77.90 132.00 235.00 466.00 689.00 1,109.00 1,641.00 15.60 19.76 28.08 56.81 101.27 171.60 305.50 605.80 895.70 1,141.70 2,133.30 Residential Commercial 3/4 inch Meter Size Meter Size and Greater (1) Gallons per Month All Year Inside Outside City City All Year Inside Outside City City Summer Excess Rate Inside Outside City City 0 - 6,000 6,001 - 15,000 15,001 - 30,000 over 30,000 $ 2.66 3.33 4.66 6.64 $ 2.92 2.92 2.92 2.92 $ 3.65 3.65 3.65 3.65 $3.46 4.33 6.06 8.64 $ 3.80 3.80 3.80 3.80 SEWER SERVICE RATES Type of Service Inside City Single Family Dwelling Unit Office Building Apartment - Average 5 units Apartment - Average 35 units Retail/Wholesale 36.87 67.09 89.10 613.63 76.84 (1) Per 1,000 gallons SOURCE: City of Glendale Finance 186 Outside City 23.60 1,740.73 114.52 171.58 N/A $ 4.75 4.75 4.75 4.75 City of Glendale, Arizona Miscellaneous Water and Sewer Statistics June 30, 2021 Schedule 21 HISTORICAL AVERAGE NUMBER OF WATER CONNECTIONS (1) Fiscal Year Ending June 30 2012 (3) 2013 (2) 2014 (2)(4) 2015 (2) 2016 (2) 2017 (2) 2018 2019 2020 2021 Residential 53,858 54,056 53,914 54,126 54,266 54,448 54,686 54,881 55,161 55,646 Multi-Family 1,673 1,680 1,799 1,800 1,800 1,799 1,790 1,790 1,790 1,789 Commercial 4,281 4,296 4,264 4,379 4,492 4,632 4,390 4,425 4,450 4,514 Sprinkler 1,666 1,669 1,819 1,862 1,885 1,910 1,863 1,955 1,974 2,025 Total 61,478 61,701 61,796 62,167 62,443 62,789 62,729 63,051 63,375 63,974 (1) In comparison to the number of billed accounts, total connections includes inactive "vacant" properties. (2) As of October following the fiscal year ended. (3) As of August 2012. (4) Review determined 269 residential connections should be classified as multi-family or sprinklers. Source: City of Glendale Water Services Department WATER DELIVERIES Acre Feet Calendar Year 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Residential (1) 27,409 27,695 26,921 26,946 26,595 27,193 27,150 27,303 26,251 27,867 Commercial 8,459 8,630 8,221 8,176 8,704 8,748 8,834 9,257 8,793 8,954 Other (2) 1,634 2,647 3,050 2,467 2,092 2,743 2,365 1,891 2,405 2,436 (1) Residential includes both Single and Multi-family deliveries. (2) Other include unbilled water and recovered effluent groundwater. Source: Annual report to Arizona Department of Water Resources 187 Sprinkler 2,684 2,648 2,413 2,411 2,327 2,581 2,564 2,536 1,691 2,913 Total 40,186 41,620 40,605 40,000 39,718 41,265 40,913 40,987 39,140 42,170 SEWERAGE CONNECTIONS BILLED AND SEWAGE TREATED Fiscal Year Ending June 30 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 No. of Connections 57,087 57,300 57,385 57,588 57,758 57,953 58,155 58,454 58,764 59,305 91st Ave WWTP (2) (MGD) Actual 7.9 7.3 8.4 6.9 7.5 7.4 6.7 7.0 6.6 9.0 Arrowhead WRF (MGD) 2.3 2.5 2.7 2.7 2.7 2.7 2.6 2.7 2.6 2.6 West Area WRF (MGD) 4.4 5.8 6.0 7.2 6.9 7.2 7.2 7.0 8.0 4.8 Total Treated 14.6 15.6 17.1 16.8 17.1 17.3 16.5 16.7 17.2 16.4 (1) In comparison to the number of billed accounts, total connections includes inactive "vacant" properties. (2) The 91st Avenue Wastewater Treatment Plant is a regional plant servicing five cities. Previously listed as "Multi-City Plant" (SROG) SOURCE: City of Glendale Water Services Department 188 This page left blank intentionally. City of Glendale Finance Division 5850 West Glendale Avenue, Suite 302 Glendale, Arizona 85301 (623) 930-2480