Comprehensive Annual FinancialBudget Report Annual FOR THE FISCAL YEAR ENDED JUNE 30, 2019 City of Goodyear, Arizona Finance Department This page intentionally left blank CITY OF GOODYEAR COMPREHENSIVE ANNUAL FINANCIAL REPORT For the Year Ended June 30, 2019 Table of Contents I. INTRODUCTORY SECTION Letter of Transmittal GFOA Certificate of Achievement City of Goodyear Officials Organizational Chart Page 1 7 8 9 II. FINANCIAL SECTION Independent Auditor’s Report 11 A. Management’s Discussion & Analysis 15 B. Basic Financial Statements 27 Government-wide Financial Statements Statement of Net Position Statement of Activities 31 32 Fund Financial Statements Governmental Fund Financial Statements Balance Sheet Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position Statement of Revenues, Expenditures and Changes in Fund Balance Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities 36 39 40 43 Proprietary Fund Financial Statements Statement of Net Position Statement of Revenues, Expenses and Changes in Fund Net Position Statement of Cash Flows 44 45 46 Fiduciary Fund Financial Statements Statement of Fiduciary Net Position Statement of Changes in Fiduciary Net Position 47 48 Notes to the Financial Statements 1. Summary of Significant Accounting Policies 2. Cash and Investments 3. Receivables 4. Capital Assets 5. Loan Payable 6. General Obligation Bonds Payable 7. Revenue Bonds Payable 8. Community Facilities Districts Bonds Payable 9. Changes in Long-term Liabilities 10. Interfund Receivables, Payables, and Transfers 11. Contingent Liabilities 12. Risk Management 13. Pensions and Other Postemployment Benefits 14. Excess of Expenditures Over Appropriations 15. Fund Balance Classifications 16. Commitments 17. Tax Abatement Agreements 18. Prior Period Adjustment Page 51 58 61 62 63 64 65 67 68 69 69 70 71 84 84 85 85 86 C. Required Supplementary Information Schedule of Revenues, Expenditures and Changes in Fund BalanceBudget and Actual General Fund Schedule of Revenues, Expenditures and Changes in Fund BalanceBudget and Actual Ballpark Fund Notes to Budget and Actual Schedules Schedule of the Proportionate Share of the Net Pension Liability Schedule of the Proportionate Share of the Net OPEB Liability Schedule of Changes in the Net Pension Liability and Related Ratios Schedule of Changes in the Net OPEB Liability and Related Ratios Schedule of Pension/OPEB Contributions Notes to the Pension/OPEB Plan Schedules 88 90 91 92 93 94 96 98 101 D. Other Supplementary Information Budgetary Comparison Schedules - Major Governmental Funds GO Bonds – Capital Projects McDowell Road Commercial Corridor ID – Debt Service Community Facilities Districts – Debt Service 104 105 106 Non-Major Governmental Funds – Financial Statements Combining Balance Sheet Combining Statement of Revenues, Expenditures, and Changes in Fund Balances 108 110 Budgetary Comparison Schedules – Non-Major Governmental Funds Page Highway User Revenue Fund Community Facilities Districts - General Grants Debt Service Non-Utility Development Impact Fees 112 113 114 115 116 Budgetary Comparison Schedules – Other Governmental Funds Park and Ride Marquee Court Enhancement Fill-The-Gap JCEF Impound Officer Safety Equipment 118 119 120 121 122 123 Budgetary Comparison Schedules – Enterprise Funds Water & Wastewater Enterprise Fund Sanitation Enterprise Fund 124 125 Fiduciary Funds – Financial Statements Combining Statement of Assets and Liabilities – Agency Funds Combining Statement of Changes in Assets and Liabilities-Agency Funds III. STATISTICAL SECTION Net Position by Component Changes in Net Position Governmental Activities Tax Revenues by Source Excise Tax Collections Sales & Use Taxes Fund Balances of Governmental Funds Changes in Fund Balances of Governmental Funds Property Tax Rates Principal Property Taxpayers Assessed Value and Estimated Actual Value of Taxable Property Property Tax Levies and Collections Utility Statistical Data Ten Largest Water Users Utility Statistical Data Ten Largest Wastewater Users Schedule of Existing and Adopted Monthly Water & Wastewater Service Charges 128 129 Table Page 1 2 3 4 5 6 7 8 9 10 11 12 13 132 134 141 142 144 146 148 152 157 158 160 161 163 14 164 Ratios of Outstanding Debt by Type Ratios of General Bonded Debt Outstanding Direct and Overlapping Governmental Activities Debt Legal Debt Margin Information Pledged Revenue Coverage Demographic and Economic Statistics Principal Employers Full-Time Equivalent City Government Employees by Function Operating Indicators by Function Capital Asset Statistics by Function Table 15 16 17 18 19 20 21 22 23 24 Page 166 168 169 170 172 173 174 175 176 180 IV. FEDERAL AND STATE REPORTS Independent Auditors Report on Internal Control over Financial Reporting and on Compliance and Other Matters Report on Compliance with State Laws and Regulations 183 185 City of Goodyear Comprehensive Annual Financial Report for the Fiscal Year Ended June 30, 2019 INTRODUCTORY SECTION INTRODUCTORY SECTION The Introductory Section includes the City’s Transmittal Letter, the Certificate of Achievement for Excellence in Financial Reporting, List of Principal Officials, and the City’s Organizational Chart. This page intentionally left blank November 22, 2019 Honorable Mayor, City Council, City Manager, and Citizens of the City of Goodyear, Arizona: State law requires that a complete set of financial statements presented in conformity with generally accepted accounting principles (GAAP) and audited in accordance with generally accepted auditing standards (GAAS) by a firm of licensed certified public accountants be published annually by cities after the close of each fiscal year. Pursuant to that requirement, we hereby issue the Comprehensive Annual Financial Report (CAFR) to the City of Goodyear, Arizona (City) for the fiscal year ended June 30, 2019. Management assumes full responsibility for the completeness and reliability of the information contained in this report, based upon a comprehensive framework of internal control that it has established for this purpose. Because the cost of internal control should not exceed anticipated benefits, the objective is to provide reasonable, rather than absolute, assurance that the financial statements are free from any material misstatements. This document represents management’s report to its governing body, constituents, legislative and oversight bodies, investors and creditors. Copies of this report will be made available to elected officials, management personnel, bond rating agencies, Municipal Securities Rulemaking Board’s Electronic Municipal Market Access system (EMMA), and other agencies which have expressed interest in the city’s financial matters. Copies of this financial report will be placed on the city’s website for use by the general public. The accounting firm of HintonBurdick, PLLC, Certified Public Accountants, an independent public accounting firm, performed the city’s annual financial statement audit. The auditors have issued an unmodified (“clean”) opinion of the City of Goodyear’s financial statements for the fiscal year ended June 30, 2019. The independent auditor’s report is located at the front of the financial section of this report. Management’s discussion and analysis (MD&A) immediately follows the independent auditor’s report on pages 15-26 and provides a narrative introduction, overview, and analysis of the basic financial statements. MD&A complements this letter of transmittal and should be read in conjunction with it. CITY OF GOODYEAR PROFILE The City of Goodyear, incorporated in 1946 and chartered in 1988, started as a small town cultivating cotton for the production of rubber tires during World War I. Located approximately 17 miles west of the downtown Phoenix business district, Goodyear has sustained continued growth and currently encompasses approximately 191 square miles in the western portion of Maricopa County. The city’s growth is attributable to excellent transportation corridors, convenient access to the central valley, a variety of housing options, a sense of community and outstanding school districts. The population of the city is estimated at 84,659. Goodyear has a Council/Manager form of government consisting of the Mayor and six council members. The Mayor and council members are elected at-large to staggered four-year terms. The City Council is vested with policy and legislative authority and is responsible for passing ordinances, adopting the budget, appointing committee, commission, and board members, and appointing the positions of City Manager, City Attorney, and City Judge. The City Manager is Page 1 responsible for carrying out the policies and ordinances of the City Council, as well as overseeing the day-to-day operations of the city. In fiscal year 2019 a staff of 644 full-time equivalent authorized employees working within 15 different departments performed the various functions of Goodyear’s city government. The city provides a full range of municipal services, including police, fire, residential sanitation, water, wastewater, streets, recreational programs, parks, cultural events, public transportation, planning and zoning, and general administrative services. Goodyear offers a wide range of community facilities including the Goodyear Ballpark, library, community center, swimming pool, and 17 parks encompassing 223 acres. The city is community-driven and includes hundreds of volunteers that serve in various areas of the city. Through their efforts, the city saved more than $829,578 in fiscal year 2019 alone. In addition, Goodyear continues to attract major employers with its location along Interstate 10 and State Route 303, availability of land, access to the entire region, and available commercial space. FINANCIAL CONTROLS Internal Controls The management of the City of Goodyear is responsible for establishing and maintaining a system of internal controls. Internal accounting controls are designed to provide reasonable, but not absolute, assurance regarding: 1) the safeguarding of assets against loss from unauthorized use or disposition, and 2) the reliability of financial records for preparing financial statements and maintaining accountability for assets. The concept of reasonable assurance recognizes: 1) the cost of a control should not exceed the benefits likely to be derived, and 2) the valuation of costs and benefits requires estimates and judgments by management. The system of internal control is subject to periodic evaluation by management and is also considered by the independent auditors in connection with the annual audit of the city’s financial statements. All internal control evaluations occur within the above framework. The city’s internal accounting controls are considered to adequately safeguard assets and provide reasonable assurance of proper recording of financial transactions. Budgetary Controls The City of Goodyear, like all cities in the State of Arizona, is subject to numerous budget and related legal requirements. Article IX, Section 20 (1) of the Arizona Constitution sets limits on the city’s legal budget capacity. At a general election held on March 11, 2003, citizens of Goodyear approved a permanent adjustment of the 1979 expenditure base for population and inflation growth. The city may utilize the additional expenditure authority for any local budgetary purposes. The permanent adjustment eliminated the need for voter approval of Home Rule every four years. The city maintains budgetary controls to ensure compliance with legal provisions embodied in the annual appropriated budget approved by the Mayor and Council. Activities of the general fund, special revenue funds, debt service funds, capital projects funds, enterprise funds, and internal service fund are included in the annual appropriated budget. The legal level of budgetary control (i.e., the level at which expenditures cannot legally exceed the appropriated amount) is the total budget, as adopted by the City Council. All funds of the City have legally adopted budgets. The initial budget for the fiscal year may be amended during the year in a legally permissible manner. The City adopts the budget by major program area for the General Fund and by fund for all others. The City Council has adopted a specific budget transfer policy which delegates the authority to perform many transfers to the City Manager or appropriate designee. The City Manager is generally authorized to transfer budgeted amounts within any specific department’s expenditure Page 2 appropriation as well as transfers which are considered administrative in nature. Generally, budget revisions requiring a transfer between major program areas in the General Fund, from City reserves/contingencies or a transfer between funds must be approved by the City Council. In addition to maintaining budgetary control via a formal appropriation, the city maintains an encumbrance accounting system. Encumbrances are made against appropriations upon the issuance of a purchase order. Encumbered appropriations lapse at fiscal year-end and are reencumbered as needed in the next fiscal year. LOCAL ECONOMIC CONDITION AND OUTLOOK Fiscal year 2019 is the fourth consecutive year that issuance of single-family residential permits has exceeded 1,000. A total of 1,230 single-family residential permits were issued during fiscal year 2019 representing a decrease of 62 permits from the prior fiscal year. In addition to residential growth, Goodyear continues to expand its commercial base with new commercial construction permits valued at over $243 million issued during the fiscal year. The City continues to budget conservatively and monitors the local, regional, and national economies in order to be ready to adapt to any changes, while still positioning ourselves for future growth. Sales Tax Goodyear, like all Arizona cities, places significant reliance on city sales tax revenues. Goodyear’s sales tax revenues remain strong and continue to increase year over year. Sales tax revenues for fiscal year 2019 increased by 10.3% over fiscal year 2018 levels. State Shared Revenues The city receives revenue allocations from the State. These state shared revenues include allocations of the state income tax, sales tax, fuel tax, and motor vehicle license taxes. A significant portion of this revenue is placed in the city’s general fund where it is used to support day-to-day activities. The city’s state shared revenues represented 18.2% of the general fund revenue for fiscal year 2019. Property Tax In fiscal year 2019, the city’s combined (primary and secondary) property tax rate rose slightly from $1.7349 to $1.7350 per $100 of assessed valuation. Although the tax rate remained virtually unchanged, increased assessed valuation resulted in a property tax levy increase of $1,030,690. The maintained stabilization in the tax rate ensures the city’s ability to service outstanding debt and maintain basic infrastructure. For the fiscal year 2020 budget, the Mayor and Council have adopted a total combined property tax rate of $1.7332 per $100 of assessed valuation, which is nearly the same as fiscal year 2019. In accordance with its budget policies, the city is below the targeted combined property tax rate of $1.74 per $100 of assessed valuation or less. LONG-TERM FINANCIAL PLANNING In 2013, the Council began a process of redefining the long-term strategic priorities of the city. This strategic plan is discussed yearly with City Council to review progress and determine priorities for the annual plan update. Any new funding requests are evaluated in the context of their relationship to the strategic focus areas. The City of Goodyear’s mission is as follows: Page 3 The City of Goodyear will provide the finest municipal services and promote a quality environment to enhance our community’s prosperity through citizen and employee participation. We are committed to the stewardship of resources and fulfillment of the public trust. Four focus priorities are identified within the Strategic Action Plan: 1. Fiscal and Resource Management: Maintaining a long-term view, we manage our fiscal, human, and physical resources in an efficient and effective manner. This effort is aligned across the organization with an emphasis on transparency. The city’s business practices will be efficient, business friendly, and ensure exceptional customer service to all stakeholders and citizens. 2. Economic Vitality: We will continue to ensure the prosperity of our community by increasing the growth of our economy through diversity of industry, business investment, quality job creation, education, and tourism. To support this growing economy, we will invest in transportation and infrastructure and seek high quality retail and entertainment opportunities. 3. Sense of Community: The city will cultivate a sense of pride through programs, gathering places, and events where the community can come together to participate in opportunities of learning and recreation. We will continue to make Goodyear residents feel connected to their city government through community engagement, outstanding customer service, and clear, accessible communication. 4. Quality of Life: We will continue to make Goodyear a place to live, work, and play that provides diverse activities and amenities in a safe and well-maintained environment, while supporting the arts and promoting the health and wellness of our community. The Strategic Action Plan establishes a road map of key strategic initiatives that best advance the vision for the city and is aligned with other planning documents used by the city, including departmental plans (which include specific strategic plans, master plans, and operational plans) which guide department priorities and individual employee performance evaluation goals. For each of these four focus priorities, long-range goals have been identified and assigned to various departments for follow-up. These priorities are also a key fundamental factor in the development of the city’s annual budget. Within each of the four focus areas, Goodyear City Council has adopted Guiding Principles to inform the way city business is carried out across the entire organization. MAJOR INITIATIVES Goodyear is an award-winning community that provides a high quality of life with its masterplanned communities, excellent schools, health care, trail systems and entertainment options, including major league sports venues.  Goodyear was ranked by the U.S. Census Bureau as being among the fastest growing cities in the country.  A NerdWallet study ranked Goodyear as one of the best cities in the nation for veterans, based on the level of economic opportunity for veterans.  Goodyear ranks sixth in the nation in overall safety. This is supported by the 2018 Citizen Satisfaction Survey which revealed that 96% of residents feel safe in their neighborhood, with 95% of residents saying Goodyear is an excellent or good place to live. Page 4 blank Page 5 Page 6 Page 7 LIST OF PRINCIPAL OFFICIALS MAYOR Georgia Lord VICE MAYOR William Stipp COUNCIL MEMBERS Joe Pizzillo Sheri Lauritano Wally Campbell Brannon Hampton Laura Kaino SENIOR MANAGEMENT STAFF Julie Arendall City Manager Mayra Galindo Presiding Judge Roric Massey City Attorney Dan Cotterman Deputy City Manager Wynette Reed Deputy City Manager Darcie McCracken City Clerk Lyman Locket Human Resources Director Paul Luizzi Fire Chief Doug Sandstrom Finance Director Gerald Geier Police Chief Christopher Baker Development Services Director Alan Claypool Information Technology Director Rebecca Zook Engineering Director Nathan Torres Park & Recreation Director Lori Gary Economic Development Director Javier Setovich Public Works Director Tammy Vo Communications Director Page 8 Citizens Mayor & Council Municipal Judge City Manager Municipal Court Deputy City Manager City Attorney Legal Services City Manager's Office Deputy City Manager Development Services City Clerk Finance Engineering Digital Communications Fire Information Technology Economic Development Human Resources Parks & Recreation Police Public Works Page 9 Page 10 City of Goodyear Comprehensive Annual Financial Report for the Fiscal Year Ended June 30, 2019 FINANCIAL SECTION The Financial Section includes the Independent Auditor’s Report, Management's Discussion and Analysis, the Audited Financial Statements, Notes to the Audited Financial Statements, Required Supplementary Information, and Other Supplementary Information. FINANCIAL SECTION This page intentionally left blank Independent Auditors’ Report The Honorable Mayor and Members of City Council City of Goodyear, Arizona Report on the Financial Statements We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Goodyear, Arizona, as of and for the year ended June 30, 2019, 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 Mangement 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, implemenation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material mistatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Page 11 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 Goodyear, Arizona, as of June 30, 2019, 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, budgetary comparison information, and the pension and OPEB schedules 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. Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City of Goodyear, Arizona’s basic financial statements. The introductory section, combining and individual fund financial statements and schedules, and the statistical section, are presented for purposes of additional analysis and are not a required part of the basic financial statements. The combining and individual fund financial statements and schedules are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion the combining and individual fund financial statements and schedules are fairly stated in all material respects in relation to the basic financial statements as a whole. The introductory and statistical sections have not been subjected to the auditing procedures applied in the audit of the basic financial statements and, accordingly, we do not express an opinion or provide any assurance on them. Page 12 Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated November 22, 2019, on our consideration of the City of Goodyear, Arizona’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City of Goodyear, Arizona’s internal control over financial reporting and compliance. HintonBurdick, PLLC Gilbert, Arizona November 22, 2019 Page 13 This page intentionally left blank Page 14 MANAGEMENT’S DISCUSSION AND ANALYSIS For The Year Ended June 30, 2019 As management of the City of Goodyear, Arizona (City), we offer readers of the City’s financial statements this narrative overview and analysis of the financial activities of the City for the fiscal year ended June 30, 2019. This discussion and analysis is designed to (1) assist the reader in focusing on significant financial issues, (2) provide an overview of the City’s financial activity, (3) identify changes in the City’s financial position, (4) identify any material deviations from the financial plan (the approved annual budget), and (5) identify individual fund issues or concerns. The management’s discussion and analysis (MD&A) has different focus and purpose than the letter of transmittal and is designed to be read in conjunction with the transmittal letter as well as the financial statements and the accompanying notes to the financial statements. FINANCIAL HIGHLIGHTS  The City’s government-wide assets and deferred outflows exceeded its liabilities and deferred inflows by $795,641,773 (net position) at the close of fiscal year 2019. Of this amount, $70,603,672 represents unrestricted net position, which may be used to meet the City’s ongoing obligations to citizens and creditors.  The $59.9 million increase in net position of the City is the result of an increase in sales tax revenues and investment earnings as well as charges for water and wastewater services.  As of the close of the current fiscal year, the City’s governmental funds reported combined ending fund balances of $185.5 million, an increase of $54.1 million (41.2 percent) in comparison with the prior year fund balance of $131.4 million. Approximately 8.8 percent of this amount ($16.4 million) is available for spending at the government’s discretion (unassigned fund balance).  At June 30, 2019, total unassigned fund balance for the general fund is $16.5 million, a decrease of $44.0 million (72.7 percent) from the prior fiscal year. OVERVIEW OF 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 comprise of three components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report also contains other supplementary information in addition to the basic financial statements themselves. 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. All of the activities of the City, except those of a fiduciary nature, are included in these statements. The activities of the City are shown in two columns on these statements – governmental activities and business-type activities. A total column for the City is also provided. The Statement of Net Position presents information on all of the City’s assets, deferred outflow of resources, liabilities, and deferred inflow of resources, with the net of all categories being reported as the City’s net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the City is improving or deteriorating. Page 15 The Statement of Activities presents information demonstrating how the City’s net position changed during the most recent fiscal year as compared with the previous 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 the 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 (e.g., uncollected taxes and earned but unused compensated absences). The net revenue (expenses) show the financial burden that was placed on the City’s taxpayers by each of these functions. Providing this information allows our citizens to consider the cost of each function in comparison to the benefits that are provided by that function.  Governmental activities – Most of the City’s basic services are included here, such as general government (administration), public safety (police, fire and court), highways and streets, public works, culture and recreation, and development services. These activities are generally supported by taxes and general revenues.  Business-type activities – The services provided by the City included here are water, wastewater, and sanitation services. These activities are primarily supported through user charges or fees. The government-wide financial statements include not only the City itself (known as the primary government), but also the operations of 10 Community Facilities Districts. Although legally separate from the City, these component units are blended with the primary government because of their governance and financial relationship to the City. Separate financial statements may be obtained at the City of Goodyear’s Finance Department, 190 North Litchfield Road, Goodyear, Arizona 85338. Fund Financial Statements. A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the City can be divided into three categories: governmental funds, proprietary funds, and fiduciary 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 focus on near-term inflows 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 the City’s near-term financing requirements. Since 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. The City maintains 10 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 General Fund, Ballpark – Special Revenue, GO Bond – Capital Projects, McDowell Road Commercial Corridor Improvement District – Debt Service, and Community Facilities Districts – Debt Service, all of which are considered to be major funds. Data from the other five 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. Page 16 Proprietary Funds. The City maintains three proprietary funds. Proprietary funds (enterprise and internal service) utilize full accrual accounting, the same method used by private sector business. The City uses separate enterprise funds to account for its water and wastewater services, and sanitation services. These funds are considered to be major funds of the City. Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The City has one internal service fund, the Self-Insurance Trust. The Self-Insurance Trust Fund reports activities related to self-insurance for employee health benefits. The internal service fund activities are reported as governmental activities on the government-wide statements. Fiduciary Funds. The City maintains five fiduciary funds. Fiduciary funds are used to account for resources held for the benefit of parties outside the City. Fiduciary funds are not reflected in the government-wide financial statements because the resources of those funds are not available to support the City’s own programs. The accounting method used for fiduciary funds is similar to the accounting method used for proprietary funds. Notes to the Financial Statements. The notes provide additional information that is essential for a full understanding of the data provided in the government-wide and fund financial statements. Other Information. In addition to the basic financial statements and accompanying notes, this report also presents certain required supplementary information concerning the City’s budget to actual comparison and progress in funding its obligation to provide pension and OPEB benefits to its employees. The combining statements referred to earlier in connection with non-major governmental funds is presented immediately following the notes to the required supplementary information on pensions. Budget to actual comparison schedules for the enterprise funds are presented in the other supplementary information section. GOVERNMENT-WIDE FINANCIAL ANALYSIS The following tables, graphs and analysis discuss the financial position and changes to the financial position of the City as a whole as of the year ended June 30, 2019 with comparative information for the previous year. Net Position The following table was derived from the current and prior year Statement of Net Position: Table 1 Net Position Governmental Activities Business-type Activities Total Primary Government 2019 $ 271,996,832 633,814,533 905,811,365 2018 $ 218,766,500 644,680,645 863,447,145 2019 $ 48,066,718 318,716,810 366,783,528 2018 $ 52,987,723 298,998,510 351,986,233 2019 $ 320,063,550 952,531,343 1,272,594,893 2018 $ 271,754,223 943,679,155 1,215,433,378 Deferred outflows 31,414,209 24,947,271 3,125,500 2,851,579 34,539,709 27,798,850 Current and other liabilities Long-term liabilities Total liabilities 26,112,482 370,709,069 396,821,551 23,638,432 362,269,353 385,907,785 9,163,126 99,725,632 108,888,758 9,452,444 108,134,807 117,587,251 35,275,608 470,434,701 505,710,309 33,090,876 470,404,160 503,495,036 5,072,806 3,596,176 709,714 382,323 5,782,520 3,978,499 342,610,234 381,473,262 227,004,152 199,032,946 569,614,386 580,506,208 4,582,213 43,953,339 10,164,456 58,788,876 31,588,627 43,643,472 $ 535,331,217 4,377,576 19,453,023 2,453,112 59,379,423 1,772,242 29,981,817 $ 498,890,455 3,636,777 2,709,427 26,960,200 $ 260,310,556 7,569,091 5,899,617 24,366,584 $ 236,868,238 4,582,213 47,590,116 10,164,456 61,498,303 31,588,627 70,603,672 $ 795,641,773 4,377,576 27,022,114 2,453,112 65,279,040 1,772,242 54,348,401 $ 735,758,693 Current and other assets Capital assets, net Total assets Deferred inflows Net position: Net investment in capital assets Restricted for: Charter mandates Capital projects Community facilities Debt service Other purposes Unrestricted Total net position Page 17 The City’s assets and deferred outflows of resources exceeded liabilities and deferred inflows of resources by $795.6 million at the close of fiscal year 2019 and by $735.7 million in 2018, providing an overall increase in the City’s net position of $59.9 million. Current and other assets increased by $57.2 million. This increase is primarily due to the issuance of general obligation bonds during the fiscal year. Current and other liabilities decreased by $1.1 million as a result of a decrease in accrued interest payable. The largest portion of the City’s net position totaling $569.6 million (71.6 percent of total net position) reflects its net investment in capital assets (e.g., land and improvements, buildings, furniture, equipment, vehicles, artwork, and infrastructure), less any related outstanding debt that was used to acquire those assets. The City uses these capital assets to provide a variety of services to its citizens. Accordingly, these assets are not available for future spending. Although the City’s investment in capital assets is reported net of related debt, it should be noted that the resources to repay this debt must be provided from other resources, since the capital assets themselves cannot be used to liquidate these liabilities. An additional portion of the City’s net position totaling $155.4 million (19.5 percent of total net position) represents resources that are subject to external restrictions on how they may be used. The remaining balance of $70.6 million (8.9 percent of total net position) is unrestricted and may be used to meet the City’s ongoing obligations to its citizens and creditors. At the end of fiscal year 2019, the City reported positive balances in all three categories of net position, both for the government as a whole, as well as for its separate governmental and business-type activities. The same situation held true for the prior fiscal year. Net Position 580.5 Net investment in capital assets 569.6 100.9 Restricted 155.4 FY2018 FY2019 54.3 Unrestricted 70.6 ‐ 100.0 200.0 300.0 400.0 500.0 600.0 In Millions Governmental Activities During the current fiscal year, the net position for governmental activities increased $36.4 million from the prior fiscal year for an ending balance of $535.3 million. The City’s sales tax revenue increased $6.1 million due to an overall improvement in the economy. Charges for services increased by $12.3 million as a result of the continued increase in commercial and residential development within the City. Additionally a significant prepayment of an assessment in the McDowell Road Commercial Corridor Improvement District was made in fiscal year 2019, increasing the Charges for services. Page 18 Business-type Activities The City business-type activities reported an increase of $23.4 million in net position bringing the total net position to $260.3 million. Charges for services revenue increased by $7.7 million due to an increase in water and wastewater rates as well as an increase in the usage of those services. Changes in Net Position The following table compares the revenues and expenses for the current and previous fiscal year: Governmental Activities 2019 2018 Revenues: Program revenues: Charges for services Operating grants and contributions Capital grants and contributions General revenues: Sales taxes Franchise taxes Property taxes State shared revenue Investment earnings Miscellaneous Total revenues Expenses: General government Public safety Highways and streets Public works Culture and recreation Development services Interest on long-term debt Water and wastewater Sanitation Total expenses Changes in net position before Transfers Transfers Special item Changes in net position Net position, beginning Net effect of prior period adjustments Net position, beginning restated Net position, ending Business-type Activities 2019 2018 Total Primary Government 2019 2018 $ 29,742,658 9,809,818 21,231,123 $ 17,448,370 16,164,698 7,442,815 $ 50,717,046 12,962,807 $ 43,015,750 12,237,823 $ 80,459,704 9,809,818 34,193,930 $ 60,464,120 16,164,698 19,680,638 64,940,363 3,274,113 22,099,698 21,244,412 4,661,685 934,949 177,938,819 58,831,503 3,181,840 20,649,103 19,967,694 1,196,857 341,814 145,224,694 1,595,877 40,902 65,316,632 47,246 37,024 55,337,843 64,940,363 3,274,113 22,099,698 21,244,412 6,257,562 975,851 243,255,451 58,831,503 3,181,840 20,649,103 19,967,694 1,244,103 378,838 200,562,537 23,478,993 52,241,594 21,330,274 7,972,935 19,083,232 8,380,985 8,797,275 141,285,288 36,653,531 3,700,000 40,353,531 498,890,455 (3,912,769) 494,977,686 $ 535,331,217 23,781,937 45,439,446 26,460,464 4,232,567 19,080,188 6,591,111 11,582,014 137,167,727 8,056,967 3,700,000 (36,893) 11,720,074 487,341,768 (171,387) 487,170,381 $ 498,890,455 31,493,180 6,681,134 38,174,314 27,142,318 (3,700,000) 23,442,318 236,868,238 236,868,238 $ 260,310,556 26,853,794 6,206,843 33,060,637 22,277,206 (3,700,000) 18,577,206 218,290,038 994 218,291,032 $ 236,868,238 23,478,993 52,241,594 21,330,274 7,972,935 19,083,232 8,380,985 8,797,275 31,493,180 6,681,134 179,459,602 63,795,849 63,795,849 735,758,693 (3,912,769) 731,845,924 $ 795,641,773 23,781,937 45,439,446 26,460,464 4,232,567 19,080,188 6,591,111 11,582,014 26,853,794 6,206,843 170,228,364 30,334,173 (36,893) 30,297,280 705,631,806 (170,393) 705,461,413 $ 735,758,693 Page 19 The pie chart below is a depiction of government-wide revenue sources. Governmental activities accounts for 73 percent of total revenues, while business activities account for 27 percent of total revenues. Charges for services are the largest source of City revenue at 33 percent which is a 33 percent increase from the previous fiscal year due to increased water and wastewater rates and an increase in the usage of those services. The second largest source of City revenue are sales taxes at 27 percent of total revenue, which increased 10 percent over the previous fiscal year due to an increase in taxable sales as a result of an improved economy. GOVERNMENT‐WIDE REVENUE SOURCES FISCAL YEAR 2019 ‐ $243,255,451 State shared revenue 9% Other 3% Charges for services 33% Property taxes 9% Franchise taxes 1% Operating grants and contributions 4% Sales taxes 27% Capital grants and contributions 14% Page 20 The reported expenses for fiscal year 2019 increased by $9.2 million (five percent) over the prior year. As seen in the following pie chart for government-wide functional expenses, governmental activities account for 79 percent of total functional expenses, while business-type activities account for 21 percent of total functional expenses. The line items that experienced notable changes were:    Highways and streets expenses account for 12 percent of the total government-wide expenses, a decrease of $5.1 million (-19 percent) from the prior year. The decrease is primarily due to decreased capital expenditures. Public safety expenses account for 29 percent of the total government-wide expenses, an increase of $6.8 million, a 15 percent increase from the prior year. The increase is primarily due to the purchase of land for two new fire stations. Culture and recreation expenses account for 11 percent of the total government-wide expenses, which is consistent with the prior year. GOVERNMENT‐WIDE FUNCTIONAL EXPENSES FISCAL YEAR 2019 ‐ $179,459,602 Sanitation 4% Water and wastewater 17% General government 13% Interest on long-term debt 5% Public safety 29% Development services 5% Culture and recreation 11% Public works 4% Highways and streets 12% Page 21 FINANCIAL ANALYSIS OF THE CITY’S FUNDS The City maintains fund accounting to demonstrate compliance with budgetary and legal requirements. The following is a brief discussion of financial highlights from the fund financial statements. Governmental Funds The focus of the City’s governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. All major governmental funds are discreetly presented on these financial statements, while non-major funds are combined into a single column. At the end of the current fiscal year, the City’s governmental funds reported combined ending fund balances of $185.5 million, an increase of 41.2 percent from the previous year. The increase in fund balance is due to the issuance of general obligation bonds and a decrease in capital expenditures. Revenues increased by $15.6 million and expenditures decreased by $10.0 million. Approximately 8.8 percent of the fund balance ($16.4 million) constitutes unassigned fund balance, which is available for spending at the City’s discretion. The remainder of the fund balance is either non-spendable, restricted, committed or assigned to indicate that it is 1) not in spendable form ($2.4 million), 2) restricted for particular purposes ($96.2 million), 3) committed for particular purposes ($2.6 million) or 4) assigned for particular purposes ($68.0 million). Revenues for governmental functions overall totaled $163.1 million in the fiscal year ended June 30, 2019, which represents an increase of $15.6 million (11 percent) from the prior fiscal year. The most significant reasons for this change is due to an increase in sales tax revenues and investment income and multiple prepayments of special assessments on the McDowell Road Commercial Corridor Improvement District and Estrella Mountain Ranch Community Facilities District. The expenditures for governmental functions totaled $147.8 million, a decrease of $10.0 million (-6.34 percent) from the prior year. The majority of this decrease is attributed to the reduction in capital outlay and debt service. Capital outlays accounted for $17.1 million in expenditures for the current fiscal year, a decrease of $13.3 million from the prior fiscal year. Debt service expenditures accounted for $34.4 million in expenditures for the current fiscal year, a decrease of $5.6 million from prior fiscal year. In fiscal year 2018 the city issued several refunding bonds which resulted in payments to refunded bonds escrow agent, which were not a debt service expenditure in fiscal year 2019. The General Fund is the chief operating fund of the City. At the end of the current fiscal year, the unassigned fund balance of the General Fund was $16.5 million, while total fund balance increased to $92.8 million. As a measure of the general funds solvency, it may be useful to compare both unassigned fund balance and total fund balance to general fund expenditures. The unassigned fund balance represents approximately 18 percent of general fund expenditures, while total fund balance represents approximately 99.8 percent of general fund expenditures. The fund balance of the City’s general fund increased by $13.3 million in the current fiscal year due primarily to growth in sales tax revenue and investment income. The fund balance of the ball park special revenue fund increased by $0.6 million resulting from a reduction in capital outlay expenditures. In fiscal year 2018, capital outlay expenditures were high due to improvements being done to the Cleveland Indians clubhouse. The fund balance of the general obligation capital projects fund increased by $22.1 million due to a bond issue of $26.9 million to fund public safety and park improvements. The fund balance of the McDowell road commercial corridor ID debt service fund remained consistent with the prior fiscal year. The fund balance of the community facilities debt service fund increased by $0.7 million from the prior fiscal year as a result of a reduction in debt service payments. In fiscal year 2018, Estrella Mountain Page 22 Ranch Community Facilities District refunded four special assessment revenue bonds, resulting in a large payment to refunded bonds escrow agent. Proprietary Funds The proprietary fund financial statements are prepared on the same accounting basis and measurement focus as the government-wide financial statements, but provide additional detail since each major enterprise fund is shown discretely. The proprietary funds net position totals $260.3 million, resulting from an increase of $23.4 million from the previous fiscal year. The water and wastewater fund had an increase in net position of $22.9 million, which is due to an increase in charges for services as a result of an increase in rates as well as usage. The sanitation fund had an increase in net position of $562,312 which is similar to the increase in the prior year. BUDGETARY HIGHLIGHTS The City’s annual budget is the legally adopted expenditure control document of the City. The schedules filed with the Auditor General’s office list the original budget adopted for the prior year, estimated expenditures through the end of the fiscal year and the adopted current year’s budget. Budgetary comparison schedules are required for the General Fund, all major funds, non-major funds and enterprise funds. The General Fund budgetary comparison schedule can be found in the Required Supplementary Information section. The other budgetary comparison schedules can be found in the Other Supplementary Information section. The decrease in original adopted budget of the City Manager is offset by increases to the Digital Communications and Human Resources original adopted budget. These changes are due to the reorganization of several departments. The original adopted budget for Development Services was adjusted upwards by $2.6 million due to increased development in the City. During the fiscal year there were two General Fund categories that came in significantly below estimates as shown below: Capital outlay Transfers out Budgeted Expenditures $ 13,451,286 16,793,300 Actual Expenditures $ 8,872,249 14,254,246 Difference $ 4,579,037 2,539,054 General Fund actual inflows (revenues and other financing sources) of $120.5 million, was more than budgeted inflows of $104.7 million due to construction sales tax and development related revenues, while expenditures and other financing uses of $107.2 million was only 69 percent of final budgeted outflows of $155.5 million as a result of unspent capital outlay, budgeted transfers out that were not necessary and $24.2 million in budgeted contingency that remained untouched throughout the fiscal year. Page 23 CAPITAL ASSETS AND DEBT ADMINISTRATION Capital Assets The City’s investment in capital assets (net of accumulated depreciation) for its governmental and business-type activities as of June 30, 2019 amounts to $952.5 million. Capital assets include land and improvements, artwork, construction in progress, right of way, water rights, streetscape, infrastructure, buildings and improvements and vehicles, furniture and equipment. In total, there was an increase of $8.8 million from the prior year. Land and improvements Artwork Construction in progress Right of way Water rights Streetscape Infrastructure Building and improvements Vehicles, furniture and equipment Total Governmental Activities 2019 2018 $ 32,820,279 $ 31,983,773 276,115 256,115 4,940,832 9,107,572 90,844,947 90,844,947 9,061,008 9,061,008 270,718,263 272,454,225 206,659,262 213,228,438 18,493,827 17,744,567 $ 633,814,533 $ 644,680,645 Business-type Activities 2019 2018 $ 7,770,072 $ 7,570,661 146,978 146,978 34,981,208 12,015,646 18,272,804 18,009,011 162,770,700 164,220,712 88,602,052 90,828,593 6,172,996 6,206,909 $ 318,716,810 $ 298,998,510 Total Primary Government 2019 2018 $ 40,590,351 $ 39,554,434 423,093 403,093 39,922,040 21,123,218 90,844,947 90,844,947 18,272,804 18,009,011 9,061,008 9,061,008 433,488,963 436,674,937 295,261,314 304,057,031 24,666,823 23,951,476 $ 952,531,343 $ 943,679,155 The change in governmental capital assets is due to an increase in accumulated depreciation which was offset by a land purchase for a fire station. The change in business-type capital assets is the result of the increase in various water and wastewater capital projects including a water treatment plant and reclamation facility. Additional information on the City’s capital assets can be found in Note 4. Debt Administration At the end of the current fiscal year, the City had total long-term debt outstanding of $370.3 million. Of this amount $113.0 million is general obligation bonds backed by the full faith and credit of the City, $87.7 million is Community Facilities Districts bonds which are paid by the property owners within those districts, $166.5 million of revenue bonds which are payable from user fees, assessments, and general fund revenues and $3.0 million loan payable to Water Infrastructure Finance Authority of Arizona (WIFA) which is payable from user fees. The following schedule shows the outstanding debt obligation as of June 30, 2019 and 2018: General obligation bonds Community facilities districts bonds Loan payable Revenue bonds Total Governmental Activities 2019 2018 $ 64,022,751 $ 41,990,387 87,655,298 90,160,000 129,286,526 144,712,865 $ 280,964,575 $ 276,863,252 Business-type Activities 2019 2018 $ 48,957,246 $ 55,074,633 3,050,815 3,323,972 37,175,000 39,830,000 $ 89,183,061 $ 98,228,605 Total Primary Government 2019 2018 $ 112,979,997 $ 97,065,020 87,655,298 90,160,000 3,050,815 3,323,972 166,461,526 184,542,865 $ 370,147,636 $ 375,091,857 The State constitution limits the amount of general obligation debt a city may issue to six percent of its total assessed valuation. The current six percent debt limitation for the City is $62.6 million. In addition, the State constitution limit allows a city to issue an additional 20 percent of its total assessed valuation for water, wastewater, lights, transportation, public safety, open space preserves, parks, playgrounds and recreational facilities. The current 20 percent debt limitation for the City is $208.7 million. The City has $113.0 million of outstanding general obligation debt of which all is subject to the 20 percent limit. Page 24 During the year, the City maintained the following bond ratings: Bonded Debt Ratings As of June 30, 2019 Type of Debt General Obligation Water & Wastewater (Revenue) Public Improvement Corporation Improvement District Bonds Moody's Investors Service Aa1 Aa3 Aa3 Aa2 Standard & Poor's AA AAA AA- Additional information on the City’s long-term debt can be found in Notes 5 through 9. ECONOMIC FACTORS AND NEXT YEAR’S BUDGET The unemployment rate for Goodyear for June 2019 was 4.8 percent, which is lower than the state rate of 4.9 percent but higher than the national rate of 3.7 percent. Arizona cities remain dependent on sales taxes and other economically sensitive tax revenues and are susceptible to slowdowns in the economy. While unemployment is not a leading economic indicator, the state of the economy will likely coincide with current unemployment rates. Total sales tax collections for fiscal year 2019 performed above anticipated budget and exceed fiscal year 2018 collections by 10.3 percent. For fiscal year 2019 non-construction sales taxes, which make up just over half of the on-going General Fund revenues, have performed above last year by 8.7 percent. This is reflective of ongoing steady growth in the local economy, including rising population that is consistent with high levels of building permit activity for new housing and growing sales taxes. Construction sales taxes, which are planned conservatively in the budget, performed well above budget and are above fiscal year 2018 by 18 percent. Development Services revenue activity is above the prior year levels which is reflected in higher than budgeted revenue collections from development agreements, building permits, and development related plan reviews. The fiscal year 2020 budget assumes continued moderate growth and a conservative approach. Consistent with Council adopted financial policies, the primary property tax is maximized at the allowed two-percent growth in the levy plus the tax on new properties. At 48 percent of General Fund revenues, non-construction sales tax are estimated at 3 percent above fiscal year 2019 budget. State shared sales, income and vehicle license taxes are more than 20 percent of the General Fund revenues and are based on population estimates provided by the state. In combination, the fiscal year 2019 stateshared General Fund revenues are projected at slightly above the fiscal year 2019 budget primarily due to changes in the corporate income taxation which has lowered state income tax collections. The fiscal year 2020 all funds budget totals $514.2 million, which is an increase of $66.8 million over fiscal year 2019. This increase can be mainly attributed to a $51.9 million increase in capital improvement projects. The largest category of expenses is capital projects and includes a carryover of $106 million for the multi-year surface water project. In addition, the budget reflects a new financial policy to adopt contingencies of 15 percent of operating revenues for the three enterprise funds, which contributes to almost a 29% increase in the contingencies portion of the fiscal year 2020 budget. Debt service decreased by $1.4 million in principal and interest payments. Operating costs increased by $12.7 million of which approximately 64 percent is from ongoing supplemental budget additions, with the balance attributed to salary and benefit increases. Page 25 CONTACTING THE CITY’S FINANCIAL MANAGEMENT This financial report is designed to provide our citizens, taxpayers, customers, and investors and creditors with a general overview of the City’s finances and to demonstrate the City’s accountability for the resources it receives. A copy of the City's Comprehensive Annual Financial Report is available online at www.goodyearaz.gov/cafr. If you have questions about this report or need additional information, contact the City of Goodyear, 190 N. Litchfield Road, by mail at P.O. Box 5100, Goodyear, Arizona 85338 or by email at gyfinance@goodyearaz.gov. Page 26 BASIC FINANCIAL STATEMENTS Page 27 Page 28 GOVERNMENT-WIDE FINANCIAL STATEMENTS Page 29 Page 30 CITY OF GOODYEAR, ARIZONA Statement of Net Position June 30, 2019 Governmental Activities Business-type Activities Total Assets Cash and cash equivalents $ Investments Receivables (net of allowance) Inventory Prepaid items/deposits Net pension/OPEB asset Temporarily restricted assets: Cash and cash equivalents Notes receivable Capital assets (net of accumulated depreciation): Land Artwork Right of way Streetscape Construction in progress Buildings Infrastructure Land improvements Vehicles, furniture, and equipment Water rights Total assets 123,125,222 68,268,744 66,517,493 990,488 1,526,624 122,586 $ 10,643,898 27,286,021 6,152,726 712,641 14,681 $ 133,769,120 95,554,765 72,670,219 1,703,129 1,526,624 137,267 9,770,425 1,675,250 3,256,751 - 13,027,176 1,675,250 30,197,312 276,115 90,844,947 9,061,008 4,940,832 206,659,262 270,718,263 2,622,967 18,493,827 - 7,770,072 146,978 34,981,208 88,602,052 162,770,700 6,172,996 18,272,804 37,967,384 423,093 90,844,947 9,061,008 39,922,040 295,261,314 433,488,963 2,622,967 24,666,823 18,272,804 905,811,365 366,783,528 1,272,594,893 24,604,951 6,809,258 31,414,209 1,220,323 1,905,177 3,125,500 25,825,274 8,714,435 34,539,709 Deferred Outflows of Resources Deferred outflows related to pensions/OPEB Deferred charge on refunding Total deferred outflows Liabilities Accounts payable and other current liabilities Interest payable Deposits Unearned revenues Noncurrent liabilities: Due within one year Due in more than one year Net pension and OPEB liability 11,082,909 1,717,736 12,664,687 647,150 6,474,011 2,683,785 5,330 17,556,920 1,717,736 15,348,472 652,480 21,552,687 282,500,420 66,655,962 6,201,484 88,007,013 5,517,135 27,754,171 370,507,433 72,173,097 Total liabilities 396,821,551 108,888,758 505,710,309 5,072,806 5,072,806 709,155 559 709,714 5,781,961 559 5,782,520 342,610,234 227,004,152 569,614,386 4,582,213 43,953,339 10,164,456 58,788,876 31,588,627 43,643,472 3,636,777 2,709,427 26,960,200 4,582,213 47,590,116 10,164,456 61,498,303 31,588,627 70,603,672 Deferred Inflows of Resources Deferred inflows related to pensions/OPEB Unavailable revenue - other Total deferred inflows Net Position Net investment in capital assets Restricted for: Charter mandates Capital projects Community facilities Debt service Other purposes Unrestricted Total net position $ 535,331,217 $ 260,310,556 $ 795,641,773 The accompanying notes are an integral part of the financial statements. Page 31 CITY OF GOODYEAR, ARIZONA Statement of Activities For the Year Ended June 30, 2019 Functions/Programs Expenses Governmental activities: General government Public safety Highways and streets Public works Culture and recreation Development services Interest on long-term debt $ Total governmental activities Business-type activities: Water and wastewater Sanitation Total business-type activities Total primary government $ 23,478,993 52,241,594 21,330,274 7,972,935 19,083,232 8,380,985 8,797,275 Charges for Services $ 4,965,435 6,987,626 382,531 405,393 4,008,274 12,993,399 - Program Revenues Operating Capital Grants & Grants & Contributions Contributions $ 2,560 429,235 5,672,646 3,705,377 $ 499,337 1,844,608 3,323,775 138,229 2,826,271 12,598,903 - 141,285,288 29,742,658 9,809,818 21,231,123 31,493,180 6,681,134 42,658,585 8,058,461 - 12,962,807 - 38,174,314 50,717,046 - 12,962,807 179,459,602 $ 80,459,704 $ 9,809,818 General Revenues: Taxes: City sales tax Franchise tax Property tax Auto lieu tax (unrestricted) State sales tax (unrestricted) Urban revenue sharing (unrestricted) Unrestricted investment earnings Other Transfers Total general revenues & transfers Change in net position Net position - beginning Prior period adjustment Net position - ending The accompanying notes are an integral part of the financial statements. Page 32 $ 34,193,930 Ne t (Expense) Revenue and Changes in Net Position Governmental Activities $ $ Business-type Activities (18,011,661) (42,980,125) (11,951,322) (7,429,313) (12,248,687) 17,211,317 (5,091,898) $ - Total $ (18,011,661) (42,980,125) (11,951,322) (7,429,313) (12,248,687) 17,211,317 (5,091,898) (80,501,689) - (80,501,689) - 24,128,212 1,377,327 24,128,212 1,377,327 - 25,505,539 25,505,539 64,940,363 3,274,113 22,099,698 3,452,313 8,121,305 9,670,794 4,661,685 934,949 3,700,000 120,855,220 40,353,531 498,890,455 (3,912,769) 535,331,217 1,595,877 40,902 (3,700,000) (2,063,221) 23,442,318 236,868,238 260,310,556 64,940,363 3,274,113 22,099,698 3,452,313 8,121,305 9,670,794 6,257,562 975,851 118,791,999 63,795,849 735,758,693 (3,912,769) 795,641,773 $ $ The accompanying notes are an integral part of the financial statements. Page 33 Page 34 FUND FINANCIAL STATEMENTS Page 35 CITY OF GOODYEAR, ARIZONA Balance Sheet Governmental Funds June 30, 2019 General ASSETS Cash and cash equivalents Investments Receivables: Taxes Interest Other Assessments Intergovernmental Due from other funds Inventories Prepaid items Notes receivable Restricted cash and investments $ 59,011,111 38,313,687 Ball Park Special Revenue GO Bonds Capital Projects $ $ 9,568,034 257,785 2,201,710 1,536,175 311,940 1,402,473 1,675,250 - Total assets LIABILITIES Accounts payable Accrued wages and benefits Accrued interest payable Accrued liabilities Deposits held Due to other funds Current bonds payable Unearned revenue 1,762,830 980,282 6,541 40,595 - 23,181,125 20,744,556 141,718 - $ 114,278,165 $ 2,790,248 $ 44,067,399 $ 4,108,434 2,258,109 27,641 11,743,496 12,755 $ 104,992 98,148 31,730 $ 114,060 - Total liabilities 18,150,435 234,870 114,060 Unavailable revenue-property taxes Unavailable revenue-special assessments Unavailable revenue-intergovernmental Unavailable revenue-other 53,069 3,287,782 - - Total deferred inflows of resources 3,340,851 - - 1,714,413 6,536,990 67,989,257 16,546,219 2,555,378 - 43,953,339 - 92,786,879 2,555,378 43,953,339 DEFERRED INFLOWS OF RESOURCES FUND BALANCES Nonspendable Restricted Committed Assigned Unassigned Total fund balances Total liabilities, deferred inflows of resources, and fund balances $ 114,278,165 $ 2,790,248 The accompanying notes are an integral part of the financial statements. Page 36 $ 44,067,399 McDowell Road Commercial Corridor ID Debt Service Community Facilities Districts Debt Service $ $ 300,545 28,910,000 - - Non-major Funds $ 147,136 50,012 23,965,104 9,770,425 34,635,918 8,230,219 Total Governmental Funds $ 619,141 55,792 3,433 550,492 678,548 - 118,891,529 68,268,744 10,334,311 461,836 2,295,750 52,875,104 550,492 1,536,175 990,488 1,402,473 1,675,250 9,770,425 $ 29,210,545 $ 33,932,677 $ 44,773,543 $ 269,052,577 $ 8,000 $ 1,188,451 3,330,000 - $ 447,323 56,636 529,285 921,191 1,536,175 594,665 $ 4,774,809 2,412,893 1,717,736 27,641 12,664,687 1,536,175 3,330,000 647,150 $ 8,000 4,518,451 4,085,275 27,111,091 28,910,000 - 47,105 23,965,104 - 44,586 136,512 - 144,760 52,875,104 136,512 3,287,782 28,910,000 24,012,209 181,098 56,444,158 292,545 - 5,402,017 - 678,548 40,017,516 (188,894) 2,392,961 96,202,407 2,555,378 67,989,257 16,357,325 292,545 5,402,017 40,507,170 185,497,328 29,210,545 $ 33,932,677 $ 44,773,543 $ 269,052,577 Page 37 Page 38 CITY OF GOODYEAR, ARIZONA Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position June 30, 2019 Total governmental fund balances $ 185,497,328 Amounts reported for governmental activities in the statement of net position are different because: Capital assets used in governmental activities are not financial resources and, therefore, are not reported in the funds. Governmental capital assets Less accumulated depreciation $ 884,089,408 (250,274,875) 633,814,533 Net OPEB asset is not an available resource and, therefore is not reported in the funds. Some liabilities, including bonds payable and capital leases, are not due and payable in the current period and therefore are not reported in the funds. Bonds payable Deferred charge on refunding Net pension and OPEB liabilities Compensated absences 122,586 $ (298,013,557) 6,809,258 (66,655,962) (6,039,550) (363,899,811) Some receivables are not available to pay for current period expenditures and, therefore, are reported as unavailable revenues in the funds. Property taxes Special assessments Intergovernmental Other $ 144,760 52,875,104 136,512 3,287,782 56,444,158 Internal service funds are used by management to charge costs of certain activities to individual funds. This amount represents the assets and liabilities of the internal service funds reported as governmental activities Deferred outflows and inflows of resources related to pensions and OPEB are applicable to future reporting periods and, therefore, are not reported in the funds. Deferred outflows Deferred inflows 3,820,278 $ 24,604,951 (5,072,806) 19,532,145 Total net position of governmental activities $ The accompanying notes are an integral part of the financial statements. Page 39 535,331,217 CITY OF GOODYEAR, ARIZONA Statement of Revenues, Expenditures, and Changes in Fund Balances Governmental Funds For the Year Ended June 30, 2019 General REVENUES Taxes Licenses, permits and fees Intergovernmental revenue Charges for services Fines and forfeitures Investment income Special assessments Contributions Other revenues $ Total revenues 72,619,200 12,314,128 21,244,411 3,139,714 1,044,516 2,868,641 2,419,466 836,195 Ball Park Special Revenue GO Bonds Capital Projects $ $ 2,561,561 76,916 1,344,967 379 645,824 - 116,486,271 3,983,823 645,824 19,958,156 43,085,779 2,827,607 9,166,697 7,641,804 8,892,340 4,941,775 674,130 5,528,568 1,256,338 153,984 5,600,000 4,566,272 - 92,982,705 15,782,177 5,528,568 23,503,566 (11,798,354) (4,882,744) 320,846 (14,254,246) 3,700,000 25,278 12,364,604 26,960,000 - (10,233,400) 12,389,882 26,960,000 Net change in fund balances 13,270,166 591,528 22,077,256 Fund balances, beginning of year 79,516,713 1,963,850 21,876,083 EXPENDITURES Current: General government Public safety Highways and streets Public works Culture and recreation Development services Capital outlay Debt service Debt issuance cost Principal Interest and fiscal charges Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Debt proceeds Sale of assets Transfers out Transfers in Total other financing sources (uses) Fund balances, end of year $ 92,786,879 $ 2,555,378 The accompanying notes are an integral part of the financial statements. Page 40 $ 43,953,339 McDowell Road Commercial Corridor ID Debt Service Community Facilities Districts Debt Service $ $ $ 59,939 7,558,242 36,686 6,430,913 79,488 2,310,134 195,634 - Non-major Funds $ 11,250,644 6,214,054 6,533,274 875,225 76,699 319,260 Total Governmental Funds $ 90,300,757 12,314,128 27,458,465 12,234,549 1,044,516 4,606,033 9,868,376 4,036,766 1,192,520 7,654,867 9,016,169 25,269,156 163,056,110 - - 843,114 373,685 7,563,123 1,971,838 20,801,270 43,459,464 7,563,123 2,827,607 14,108,472 7,641,804 17,066,876 5,960,000 1,491,718 4,020,000 4,302,961 553,693 4,927,613 1,531,018 553,693 21,763,951 12,045,953 7,451,718 8,322,961 17,764,084 147,832,213 203,149 693,208 7,505,072 15,223,897 - - 7,871,083 1,889,642 34,831,083 346,124 (14,254,246) 17,954,246 - - 9,760,725 38,877,207 203,149 693,208 17,265,797 54,101,104 89,396 4,708,809 23,241,373 131,396,224 292,545 $ 5,402,017 $ 40,507,170 $ Page 41 185,497,328 Page 42 CITY OF GOODYEAR, ARIZONA Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balance of Governmental Funds to the Statement of Activities For the Year Ended June 30, 2019 Amounts reported for governmental activities in the statement of activities 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 costs of those assets is allocated over their estimated useful lives and reported as depreciation expense. This is the difference between capital outlay and depreciation in the current period. Capital outlay Depreciation expense $ 54,101,104 $ 11,669,399 (22,380,916) (10,711,517) Disposals and transfers of capital assets are not reported in the governmental funds. The net effect of these transactions decreased net position. (743,631) Governmental funds do not report contributions of capital assets as revenue, unless the assets will be held for sale. However, in the statement of activities, the donation of capital assets is reported as revenue. 3,323,775 Some revenues in the Statement of Activities that do not provide current financial resources are not reported as revenues in the funds. Property taxes $ Special assessments Intergovernmental Other (58,305) 340,835 116,924 1,587,560 1,987,014 The issuance of long-term debt (e.g., bonds, leases) provides current financial resources in the governmental funds but increases long-term liabilities in the statement of net position. (34,831,083) Repayment of long-term debt (e.g., bonds, leases) principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the statement of net position. $ 21,763,951 Bond principal retirement Amortization of deferred charges 22,529 Amortization of premiums and discounts 1,437,398 23,223,878 Pension and OPEB contributions are reported as expenditures in the governmental funds when made. However, they are reported as deferred outflows of resources in the Statement of Net Position because the net pension and OPEB liability is measured a year before the City's report date. Pension and OPEB expense, which is the change in the net pension and OPEB liability adjusted for changes in deferred outflows and inflows of resources related to pensions and OPEB, is reported in the Statement of Activities. Pension and OPEB contributions $ 7,939,541 Pension and OPEB expense (7,733,998) 205,543 Compensated absences are reported in the statement of activities and do not require the use of current financial resources and therefore are not reported as expenditures in governmental funds. 19,434 Accrued interest for long-term debt is not reported as an expenditure for the current period while it is recorded in the statement of activities. 2,342,444 The net revenues of certain activities of the internal service fund is reported with governmental activities. 1,436,570 Change in net position of governmental activities $ 40,353,531 The accompanying notes are an integral part of the financial statements. Page 43 CITY OF GOODYEAR, ARIZONA Statement of Net Position Proprietary Funds June 30, 2019 Business-type Activities - Enterprise Funds ASSETS Current Assets: Cash Investments Receivables (net of allowance) Interest receivable Inventories Prepaid items Water & Wastewater $ 8,231,759 26,538,317 4,976,557 177,814 712,641 - Sanitation $ 2,412,139 747,704 993,367 4,988 - Totals $ 10,643,898 27,286,021 5,969,924 182,802 712,641 - Governmental Activities Self-Insurance Trust Internal Service Fund $ 4,233,693 124,151 Total current assets 40,637,088 4,158,198 44,795,286 4,357,844 Noncurrent Assets: Restricted cash and investments Net pension/OPEB asset Land Artwork Construction in progress Buildings Infrastructure Vehicles, furniture, and equipment Water rights Accumulated depreciation 3,256,751 12,820 7,770,072 146,978 34,981,208 115,354,949 218,832,241 14,877,932 20,486,526 (94,746,672) 1,861 150,522 1,757,361 (894,307) 3,256,751 14,681 7,770,072 146,978 34,981,208 115,505,471 218,832,241 16,635,293 20,486,526 (95,640,979) - Total noncurrent assets 320,972,805 1,015,437 321,988,242 - 361,609,893 5,173,635 366,783,528 4,357,844 DEFERRED OUTFLOWS OF RESOURCES Loss on refunding Deferred outflows related to pensions/OPEB Total deferred outflows of resources 1,905,177 1,069,477 2,974,654 150,846 150,846 1,905,177 1,220,323 3,125,500 - LIABILITIES Current liabilities: Accounts payable Accrued wages and benefits Claims payable Unearned revenue Customer deposits Compensated absences - current portion Loans payable - current portion Bonds payable - current portion 5,804,736 189,749 2,300 2,683,785 192,814 278,620 5,710,093 444,525 35,001 3,030 19,957 - 6,249,261 224,750 5,330 2,683,785 212,771 278,620 5,710,093 85,951 451,615 - Total Assets Total current liabilities 14,862,097 502,513 15,364,610 537,566 Noncurrent liabilities: Compensated absences Net pension/OPEB liability Loans payable, net of current portion Bonds payable, net of current portion 324,060 4,847,463 2,772,194 84,856,928 53,831 669,672 - 377,891 5,517,135 2,772,194 84,856,928 - Total noncurrent liabilities Total liabilities 92,800,645 107,662,742 723,503 1,226,016 93,524,148 108,888,758 537,566 622,943 559 623,502 86,212 86,212 709,155 559 709,714 - 225,990,576 3,636,777 2,709,427 23,961,523 1,013,576 2,998,677 227,004,152 3,636,777 2,709,427 26,960,200 3,820,278 DEFERRED INFLOWS OF RESOURCES Deferred inflows related to pensions/OPEB Unavailable revenue-other Total deferred inflows of resources NET POSITION Net investment in capital assets Restricted for capital projects Restricted for debt service Unrestricted Total net position $ 256,298,303 $ 4,012,253 $ 260,310,556 The accompanying notes are an integral part of the financial statements. Page 44 $ 3,820,278 CITY OF GOODYEAR, ARIZONA Statement of Revenues, Expenses, and Changes in Fund Net Position Proprietary Funds For the Year Ended June 30, 2019 Business-type Activities - Enterprise Funds Water & Wastewater Operating Revenues Charges for services Self insurance premiums Other revenues $ Total operating revenues 42,620,408 38,177 Sanitation $ 8,038,655 19,806 Totals $ 50,659,063 57,983 Governmental Activities Self-Insurance Trust Internal Service Fund $ 9,516,217 50 42,658,585 8,058,461 50,717,046 9,516,267 Salaries, wages and benefits Cost of sales and services Claims expense Depreciation 5,009,783 14,574,791 8,030,481 754,359 5,766,256 160,519 5,764,142 20,341,047 8,191,000 1,173,948 6,961,401 - Total operating expenses 27,615,055 6,681,134 34,296,189 8,135,349 15,043,530 1,377,327 16,420,857 1,380,918 Investment income Interest expense and fiscal charges Gain (loss) on sale of assets 1,510,892 (3,878,125) 40,902 84,985 - 1,595,877 (3,878,125) 40,902 55,652 - Total non-operating revenue (expense) (2,326,331) 84,985 (2,241,346) 55,652 12,717,199 1,462,312 14,179,511 1,436,570 Capital contributions Transfers out Transfers in 12,962,807 (5,056,487) 2,256,487 (900,000) - 12,962,807 (5,956,487) 2,256,487 - Change in net position 22,880,006 562,312 23,442,318 1,436,570 233,418,297 3,449,941 236,868,238 2,383,708 Operating Expenses Operating income (loss) Non-operating Revenues (Expenses) Income (loss) before contributions and transfers Total net position, beginning of year Total net position, end of year $ 256,298,303 $ 4,012,253 $ 260,310,556 The accompanying notes are an integral part of the financial statements. Page 45 $ 3,820,278 CITY OF GOODYEAR, ARIZONA Statement of Cash Flows Proprietary Funds For the Year Ended June 30, 2019 Water & Wastewater Cash Flows From Operating Activities: Cash received from customers Cash received from contributions Cash paid to suppliers Cash paid to employees Cash paid for claims $ Cash flows from operating activities 42,620,190 (13,419,005) (5,474,623) - Sanitation $ 7,966,798 (5,762,307) (760,697) - Totals $ 50,586,988 (19,181,312) (6,235,320) - Self-Insurance Trust Internal Service Fund $ 9,516,267 (1,255,908) (6,989,533) 23,726,562 1,443,794 25,170,356 1,270,826 (2,800,000) (900,000) (3,700,000) - (2,800,000) (900,000) (3,700,000) - Cash Flows From Capital and Related Financing Activities: Proceeds from long term debt Purchase of capital assets Proceeds from sale of capital assets Principal paid on long term debt Interest paid 5,152,243 (14,627,347) 40,902 (13,272,896) (5,159,600) (319,147) - 5,152,243 (14,946,494) 40,902 (13,272,896) (5,159,600) - Cash flows from capital and related financing activities (27,866,698) (319,147) (28,185,845) - Cash Flows From Investing Activities: Sale (purchase) of investments Investment income 1,644,173 755,668 (10,818) 60,174 1,633,355 815,842 55,652 Cash flows from investing activities 2,399,841 49,356 2,449,197 55,652 Net change in cash and cash equivalents Cash and cash equivalents, including temporarily restricted cash, beginning of year (4,540,295) 274,003 (4,266,292) 1,326,478 16,028,805 2,138,136 18,166,941 2,907,215 Cash Flows From Noncapital Financing Activities: Transfers Cash flows from noncapital financing activities Cash and cash equivalents, including temporarily restricted cash, end of year Reconciliation of operating income to net cash flows from operating activities: Net operating income (loss) Adjustments to reconcile operating income (loss) to net cash flows from operating activities: Depreciation/amortization Pension/OPEB expense Employer pension/OPEB contributions Changes in operating assets and liabilities: (Increase) decrease in receivables (Increase) decrease in prepaid items & deposits (Increase) decrease in inventory Increase (decrease) in payables Increase (decrease) in accrued liabilities & deposits Increase (decrease) in unearned revenue $ 11,488,510 $ 2,412,139 $ 13,900,649 $ 4,233,693 $ 15,043,530 $ 1,377,327 $ 16,420,857 $ 1,380,918 8,030,481 288,927 (409,714) 160,519 36,999 (56,590) 8,191,000 325,926 (466,304) - (41,254) (67,533) 1,223,319 (344,053) 2,859 (94,693) 3,949 13,253 3,030 (135,947) (67,533) 1,227,268 (330,800) 5,889 (124,151) 14,059 - Net cash flows from operating activities $ 23,726,562 $ 1,443,794 $ 25,170,356 $ 1,270,826 Supplemental Schedule of Non-cash Financing and Investing Activities: Contributed capital assets Unrealized gains and losses on investments $ $ 12,962,807 (755,224) $ $ (24,811) $ $ 12,962,807 (780,035) $ $ - The accompanying notes are an integral part of the financial statements. Page 46 CITY OF GOODYEAR, ARIZONA Statement of Net Position Fiduciary Funds June 30, 2019 Pension Trust Assets Cash and cash equivalents Mutual funds Total assets $ Liabilities Deposits held for others Total liabilities Net Position Net position restricted for pensions $ Agency 31,269 478,394 509,663 $ $ 53,605 53,605 - $ $ 53,605 53,605 509,663 The accompanying notes are an integral part of the financial statements. Page 47 CITY OF GOODYEAR, ARIZONA Statement of Changes in Net Position Fiduciary Funds For the Year Ended June 30, 2019 Pension Trust Additions Investment Income Total assets $ 27,466 27,466 Deductions Benefits Total liabilities 9,244 9,244 Changes in net position 18,222 Net position, beginning of year 491,441 Net position, end of year $ 509,663 The accompanying notes are an integral part of the financial statements. Page 48 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. Note Page 1. Summary of Significant Accounting Policies 51 2. Cash and Investments 58 3. Receivables 61 4. Capital Assets 62 5. Loan Payable 63 6. General Obligation Bonds Payable 64 7. Revenue Bonds Payable 65 8. Community Facilities Districts Bonds Payable 67 9. Changes in Long-Term Liabilities 68 10. Interfund Receivables, Payables, and Transfers 69 11. Contingent Liabilities 69 12. Risk Management 70 13. Pensions and Other Postemployment Benefits 71 14. Excess of Expenditures Over Appropriations 84 15. Fund Balance Classifications 84 16. Commitments 85 17. Tax Abatement Agreements 85 18. Prior Period Adjustment 86 Page 49 Page 50 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The financial statements of the City of Goodyear, Arizona (City) have been prepared in conformity with accounting principles generally accepted in the United States of America as applied to government units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. During the year ended June 30, 2019, the City implemented the provisions of GASB Statement No. 83, Certain Asset Retirement Obligations. This Statement requires the measurement of an “asset retirement obligation” (ARO) to be based on the best estimate of the current value of outlays expected to be incurred. The deferred outflow of resources associated with an ARO will be measured at the amount of the corresponding liability upon initial measurement and generally recognized as an expense during the reporting periods that the asset provides service. During the year ended June 30, 2019, the City also implemented the provisions of GASB Statement No. 88, Certain Disclosures Related to Debt, including Direct Borrowings and Direct Placements. This Statement requires that additional essential information related to debt be disclosed in notes to financial statements, including unused lines of credit; assets pledged as collateral for the debt; and terms specified in debt agreements related to significant events of default with finance-related consequences, significant termination events with finance-related consequences, and significant subjective acceleration clauses. A. Reporting Entity The City is a municipal entity governed by an elected mayor and six-member governing council (council). As required by accounting principles generally accepted in the United States of America, these financial statements present the City and its blended component units, entities for which the City is considered financially accountable. In accordance with GASB Statement No. 14, and as amended by GASB Statement No. 61, the component units discussed below have been included in the City’s reporting entity because of the significance of their operational or financial relationship with the city. The financial reporting entity consists of a primary government, and its component units. The City is a primary government that has a separately elected governing body, is legally separate, and is fiscally independent of other state or local governments. Furthermore, component units are combined with the City for financial statement presentation purposes, and are not included in any other governmental reporting entity. Consequently, the City’s financial statements include the funds of those organizational entities for which its elected governing body is financially accountable. Blended Component Units - Community Facilities Districts were formed for the purpose of acquiring and improving public infrastructure in specified land areas. As special purpose districts and separate political subdivisions under the Arizona Constitution, the Districts can levy taxes and issue bonds independently of the City. Property owners in the designated areas are assessed for District taxes and thus for the cost of operating the Districts. The City Council serves as the Board of Directors; however, the City has no liability for the Districts’ debt. Although it is legally separate from the City, the Districts are reported as if it is part of the primary government because the District’s governing body is substantively the same as the governing body of the City and management of the City has operational responsibility for the Districts. The following are the community facilities districts currently operating in the City of Goodyear.           Goodyear Community Facilities General District No. 1 Goodyear Community Facilities Utilities District No. 1 Wildflower Ranch Community Facilities District No. 1 Wildflower Ranch Community Facilities District No. 2 Estrella Mountain Ranch Community Facilities District Cottonflower Community Facilities District Centerra Community Facilities District Cortina Community Facilities District Palm Valley Community Facilities District No. 3 King Ranch Community Facilities District Page 51 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Complete financial statements of the individual component units may be obtained at the entities’ administrative offices or online at www.goodyearaz.gov/cfd. B. Government-Wide and Fund Financial Statements The government-wide financial statements (i.e., the statement of net position and the statement of activities) present financial information about the City as a whole. Generally, the effect of interfund activity has been removed from the government-wide financial statements. Net interfund activity and balances between the governmental activities and the business-type activities are shown in the government-wide financial statements. The “doubling up” effect of internal service fund activity has been removed from the government-wide statements with the expenses shown in the various functions on the Statement of Activities. These statements are to distinguish between the governmental and business-type activities of the City. Governmental activities normally are supported by taxes and intergovernmental revenues, and are reported separately from business-type activities, which rely to a significant extent on fees and charges for support. 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, state-shared revenues, investment income and other items not included among program revenues are reported instead as general revenues. Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds, even though the latter are excluded from the government-wide financial statements. Major individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements. C. Fund Balances – Governmental Funds As of June 30, 2019, fund balances of the governmental funds are classified as follows: Nonspendable - amounts that cannot be spent either because they are in nonspendable form or because they are legally or contractually required to be maintained intact. Restricted - amounts that can be spent only for specific purposes because of constitutional provisions or enabling legislation or because of constraints that are externally imposed by creditors, grantors, contributors, or the laws or regulations of other governments. Committed - amounts that can be used only for specific purposes determined by a formal action of City Council. City Council is the highest level of decision-making authority for the City. Commitments may be established, modified, or rescinded only through resolutions approved by City Council. Assigned - amounts that do not meet the criteria to be classified as restricted or committed but that are intended to be used for specific purposes. Under the City’s adopted policy, the City appropriates funding for information technology (IT) replacement, fleet replacement, risk management, police and fire equipment, parks and traffic signal asset management reserves. In addition, amounts encumbered related to projects that carry over into the next fiscal year are reported as assigned. The accumulated appropriations for these purposes which have not been spent are reflected as assigned fund balances. Only City Council or the City’s Finance Director may assign amounts for specific purposes. Page 52 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Unassigned - includes all spendable amounts not contained in the other classifications. The General Fund is the only fund that can report a positive unassigned fund balance. In other governmental funds, other than the general fund, if expenditures incurred for specific purposes exceed the amounts that are restricted, committed, or assigned to those purposes, it may be necessary to report a negative unassigned fund balance in that fund. The General Fund has Unassigned Funds consisting of a contingency reserve in the amount of $14.6 million which includes the $4.6 million of charter mandates. These charter mandates are Restricted Funds. The contingency reserve is used to set aside resources to cover unanticipated deficits or revenue reductions that may be caused by adverse economic conditions or public emergency. The amount of the contingency reserve is equal to or greater than 15 percent of fiscal year 2019 on-going revenues. When an expenditure is incurred for purposes for which both restricted and unassigned fund balance is available, the City considers restricted funds to have been spent first. When an expenditure is incurred for which committed, assigned, or unassigned fund balances are available, the City considers amounts to have been spent first out of committed funds, then assigned funds, and finally unassigned funds, as needed, unless City Council or the City’s Finance Director has provided otherwise in its commitment or assignment actions. D. Measurement Focus, Basis of Accounting, and Financial Statement Presentation Government-wide Financial Statements - The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund financial statements. 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 revenues as soon as all eligibility requirements imposed by the grantor or provider have been met. As a general rule, the effect on internal activity has been eliminated from the government-wide financial statements. Fund Financial Statements - 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. Revenues are considered to be available when they are collectible 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 are generally recognized when the related fund liability is incurred, as under accrual accounting. However, debt services expenditures, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due. Property taxes, sales taxes, franchise taxes, licenses and permits, charges for service, special assessments and investment income associated with the current fiscal period are considered to be susceptible to accrual and have been recognized as revenues of the current fiscal period. Grants and similar awards are recognized as revenues as soon as all eligibility requirements imposed by the grantor or provider have been met, and the amount is received during the period or within the availability period for this revenue source (within 60 days of year-end). All other revenue items are considered to be measurable and available only when cash is received by the government. The City reports the following major governmental funds: General Fund - This fund is the general operating fund of the City. It accounts for all financial resources of the City, except those either required to be accounted for in other funds or when the city determines there is an operational advantage to do so. Page 53 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Ballpark Special Revenue Fund - This fund accounts for the revenue portion of the ballpark. GO Bond Capital Projects Fund - This fund accounts for the capital projects financed by the GO bond debt. McDowell Road Commercial Corridor Improvement District Debt Service Fund - This fund accounts for the debt portion of the McDowell Road Improvement District. Community Facilities Districts - Debt Service Fund - This fund accounts for the debt portion of the City’s Community Facilities Districts, which are component units that provide general infrastructure and capital assets for the property within each District’s boundaries. The City reports the following major proprietary funds: Water and Wastewater Fund - This fund accounts for the City’s water and wastewater utility operations, including the utility development impact fees. Sanitation Fund - This fund is used to account for the activities of the City’s sanitation operations. Internal Service Fund – This fund is used to account for self-insurance for employee benefits. The Internal service fund activities are reported as governmental activities on the government-wide statements. 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 City’s enterprise funds are charges to customers for water, wastewater, and sanitation services. Operating expenses for these funds include the administrative expenses, cost of sales and services, and depreciation. All revenues and expenses not meeting this definition are reported as non-operating revenues and expenses. Pension Trust Fund – This fund is used to account for the Goodyear Volunteer and Reserve Firefighter Retirement Trust Plan Fund, a defined contribution plan for which the assets are held by the City in a trustee capacity. The Pension Trust Fund is reported using the accrual basis of accounting. Agency Funds – The City holds these assets as an agent for individuals, private organizations or others in a temporary custodial capacity. The City currently maintains four agency funds. The four funds account for monies donated by individuals for the GAIN, Fill-A-Need, Shop With A Cop, and Arizona in Action activities. Fiduciary funds account for assets held by the City in a trustee or agency capacity on behalf of others. The reporting focus is upon net position and changes in net position and employs accounting principles similar to proprietary funds. Fiduciary funds are not included in the government-wide financial statements considering they are not assets of the City available to support City programs. The focus of governmental fund financial statements is on major funds rather than reporting funds by type. Each major fund is presented in a separate column. Non-major funds are aggregated and presented in a single column. The City’s non-major funds are as follows: Special Revenue Funds Highway User Revenue Fund (HURF) Community Facilities Districts Grants Fund Page 54 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Debt Service Fund Capital Projects Funds Non-Utility Development Impact Fees Fund E. Cash and Cash Equivalents Cash represents amounts in demand deposits and amounts held in trust by financial institutions. The funds held in trust are available to the City upon demand. The City considers short-term investments (including restricted assets) in the State of Arizona investment pool, mutual fund-money market, U.S. Treasury bills and notes with maturities of three months or less at acquisition date to be cash equivalents. F. Investments Goodyear maintains investment accounts for funds that are not legally required to be maintained separately. Each fund's equity in investments represents that fund's position in the consolidated accounts and determines that fund's allocation of interest earned. Arizona Revised Statutes regulate the investment of surplus cash. Goodyear limits its investments to U.S. government securities, certificates of deposit, bonds, repurchase agreements, corporate notes, commercial paper, and money market accounts. Investments are stated at fair value based on quoted market prices and cash equivalents are stated at amortized cost. G. Receivables and Payables Activity between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as either “due to/from other funds” (i.e., the current portion of inter-fund loans) or “advances to/from other funds” (i.e., the non-current portion of the inter-fund loans). All trade and property tax receivables are shown net of allowance for uncollectibles. Trade accounts receivable in excess of 180 days comprise the trade accounts receivables allowance for uncollectibles. Property taxes are levied by the City and collected by the Maricopa County Treasurer. Property taxes are levied no later than the third Monday of August and are payable in two installments due October 1 of the current year and March 1 of the subsequent year. Taxes become delinquent after the first business day of November and May, respectively. Interest attaches on installments after the delinquent date. A lien attaches to the property on the first day of January preceding the assessment and levy of taxes. Delinquent amounts bear interest at the rate of 16 percent. Maricopa County, at no charge to the taxing entities, bills and collects all property taxes. Public auctions of properties which have delinquent real estate taxes are held in February. H. Inventory Inventories are valued at average cost using the first-in, first-out (FIFO) flow method. Inventory, which consists of expendable supplies and vehicle repair parts, is recorded as an expenditure at the time individual inventory items are consumed rather than when purchased. I. Prepaid Items Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both the government-wide and fund financial statements. The cost of prepaid items is recorded as expenditures when consumed rather than when purchased. Page 55 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES J. Restricted Assets Certain proceeds of the City’s bonds, as well as certain resources set aside for their repayment, are classified as restricted cash and cash equivalents on the government-wide Statement of Net Position, the Balance Sheet and Proprietary Statement of Net Position because their use is limited by applicable bond covenants K. Capital Assets Capital assets, which include land, land improvements, artwork, right of way, streetscape, buildings and improvements, vehicles, machinery, equipment, construction in progress, and infrastructure assets (e.g., roads, bridges, sidewalks, and similar items), are reported in the applicable governmental or business-type activities columns in the government-wide financial statements. The City defines capital assets as assets with an initial, individual cost of $5,000 or more and an estimated useful life of more than one year. Capital assets are recorded at historical cost if purchased or constructed. Donated capital assets are recorded at estimated acquisition value at the date of donation. The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend the life of the asset are not capitalized. Major outlays for capital assets and improvements are capitalized as projects as they are constructed. Interest incurred during the construction phase of capital assets of business-type activities is included as part of the capitalized value of the assets constructed. Certain capital assets of the City are depreciated using the straight-line method over the following estimated useful lives: Assets Infrastructure Land Improvements Buildings and Improvements Vehicles, Furniture and Equipment Water Rights Years 20-65 15 7-50 3-20 100 The City has a collection of artwork presented both in buildings and public outdoor spaces. The true value of the art is expected to either be maintained at cost or appreciate over time, and thus, the art is not depreciated. If individual pieces are lost or destroyed, the loss is recorded. L. Deferred Outflows/Inflows of Resources In addition to assets, the statement of net position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows 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 loss on refunding 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 sometimes 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 three items that qualify for reporting in this category. It is unavailable revenue, which arises only under a modified accrual basis of accounting, deferred inflow related to pensions and OPEB, and deferred gain on refunding. Page 56 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES M. Compensated Absences The City’s employee vacation and sick leave policies provide for granting vacation and sick leave with pay. Sick leave and vacation benefits vest at the employee’s current rate of pay. The current and long-term liabilities for accumulated vacation and sick leave are reported on the government-wide financial statements and in the proprietary fund financial statements. A liability for these amounts is reported in governmental funds only if they have matured, for example, as a result of employee leave, resignation and retirements. Resources from the General Fund are generally used to liquidate the governmental funds liabilities for compensated absences. N. Long-term Obligations In the government-wide financial statements and proprietary fund financial statements, long-term debt and other long-term obligations are reported as liabilities on the statement of net position. Bond premiums and discounts are amortized over the life of the bonds using the straight-line method. Deferred amounts on refunding result from the difference between the carrying value of refunded debt and its reacquisition price. This amount is deferred and amortized over the shorter of the life of the refunded or refunding debt. In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond issuance costs, during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures. O. Inter-fund Activity Flows of cash from one fund to another without a requirement for repayment are reported as inter-fund transfers. Inter-fund transfers between governmental funds are eliminated in the Statement of Activities. Inter-fund services provided and used are not eliminated in the process of consolidation. Inter-fund transfers in the fund statements are reported as other financing sources/uses in governmental funds and fall below the non-operating revenues/expenses in the proprietary funds. P. Estimates The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates. Q. Budgetary Data According to the laws of the State of Arizona, all operating budgets must be approved by their governing board on or before the second Monday in August to allow sufficient time for legal announcements and hearings required for the adoption of the property tax levy on the third Monday in August. In April, the proposed budget for the following fiscal year is presented by the City Manager to the City Council. The budget includes proposed expenditures and the means of financing them. A public meeting is held to obtain citizen comment. Prior to June 30, the City Council legally enacts the budget, through the passage of an ordinance. The ordinance sets the limit for expenditures for the year, within the voter mandated state expenditure limitation. Additional expenditures may be authorized if directly necessitated by a natural or man-made disaster as prescribed in the state constitution. There were no supplemental appropriations made during fiscal year 2019. Page 57 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The maximum legal expenditure permitted for the year is the total budget as adopted. All funds of the City have legally adopted budgets. The initial budget for the fiscal year may be amended during the year in a legally permissible manner. The City adopts the budget by major program area for the General Fund and by fund for all others. In practice, the City Council approves all budget transfers that cross appropriation lines on a monthly basis. All unencumbered expenditure appropriations expire at the end of the fiscal year. Encumbered amounts are re-budgeted in the following year as deemed appropriate and necessary after review by the Budget Office. Budgetary carry forwards are approved by the City Council through the budgetary process. The budgets are adopted on a basis differing from GAAP in that for budgetary purposes: (1) bond proceeds for enterprise funds are considered revenue; (2) capital outlays for enterprise funds are treated as expenses; (3) debt service principal payments are treated as expenses for enterprise funds; (4) accrued compensated absences are not recognized as expenses; (5) depreciation and amortization are not recognized as expenses; (6) contributions to pension plans are recognized as an expense for enterprise funds. R. Pensions and Other Postemployment Benefits For purposes of measuring the net pension and other postemployment benefit (OPEB) assets and liabilities, related deferred outflows of resources and deferred inflows of resources, and related expenses, information about the pension and OPEB plans’ fiduciary net position and additions to/deductions from the plans’ fiduciary net position have been determined on the same basis as they are reported by the plan. 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. NOTE 2 CASH AND INVESTMENTS At June 30, 2019, cash and cash equivalents are presented as follows: Governmental Activities Cash and cash equivalents $ 123,125,222 $ 132,895,647 Restricted cash and cash equivalents Total Busines Activities Fiduciary Funds $ 10,643,898 $ 84,874 $ 13,900,649 $ 84,874 9,770,425 3,256,751 Total $ 133,853,994 $ 146,881,170 - 13,027,176 The restricted cash and cash equivalents are proceeds from debt issuances that are held in trustee accounts for the purpose of major capital improvements as well as funds held in trustee accounts for the purpose of debt service payments. The City also restricts the cash and cash equivalents in the Community Facilities Districts Debt Service Fund. Deposits The City maintains a cash and investment pool that is available for use by all funds. Each fund type’s portion of this pool is displayed on the government-wide Statement of Net Position, and on the fund financial statements, as “Cash and cash equivalents” and “Investments”. At June 30, 2019, the City had $16,060 of cash on hand. The carrying amount of the City’s deposits totaled $6,188,224, and the bank balance was $6,597,996. Of the bank balance, $250,000 was covered by federal depository insurance, $3,118,834 was covered by the Statewide Pooled Collateral Program, and $3,257,113 were securities held by the pledging financial institution’s trust department in the City’s name. Page 58 NOTE 2 CASH AND INVESTMENTS Cash Equivalents The City invests in the Local Government Investment Pool 5 and Pool 7 (LGIP) investment pools managed by the State Treasurer’s Office that allows governments within the State to pool their funds for investment purposes. The LGIP is not registered with the Securities Exchange Commission under the 1940 Investment Advisors Act. The State Board of Investment has oversight responsibilities of the investment pool in accordance with ARS 35-311. The pool’s policy is to invest in fixed-rate securities with a final maturity less than 18 months from the settlement date of the purchase and variable-rate securities with final maturity less than 2 years. The weighted average to maturity shall not exceed 90 days. The net asset value per share of the pool at June 30, 2019 was $1.00. The Arizona State Treasurer issues a publicly available financial report that includes financial statements and required supplementary information. Copies may be obtained by contacting the Arizona State Treasurer, 1700 West Washington, Phoenix, Arizona 85007 or www.aztreasury.gov. Funds held in the State Treasurer’s Local Government Investment Pool represent a proportionate interest in the pool’s portfolio; however, the City’s portion is not identified with specific investments and is not subject to custodial credit risk. At June 30, 2019, the City’s funds invested with the State Treasurer totaled $140,676,886. The City’s investment in the State of Arizona’s local government investment pool is stated at fair value which also approximates the value of the investment upon withdrawal. Investment Type LGIP 5 LGIP 7 Total Investment Type LGIP 5 LGIP 7 Total Total $ 84,950,938 55,725,948 $140,676,886 Remaining Maturity (in Years) Less than 1 $ 84,850,938 55,725,948 $140,676,886 Total $ 84,950,938 55,725,948 $140,676,886 Rating as of Year End AAA $ 84,850,938 55,725,948 $140,676,886 Investments The City’s portfolio complies with Arizona Revised Statutes (ARS) and the City’s investment policy. The Arizona Revised Statutes regulate the investment of surplus cash. Goodyear limits its investments to U.S. government securities, certificates of deposit, bonds, repurchase agreements, corporate notes, commercial paper, and money market accounts. The City categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on the valuation inputs used to measure the fair value of the asset. Level 1 inputs are quoted prices in active markets for identical assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable inputs. U.S. Treasury securities and Money Market Accounts are valued using quoted market prices (Level 1 inputs); while Federal Agency Securities, Corporate Notes, Mutual Funds and Negotiable Certificates of Deposit are valued using a matrix pricing model (Level 2 inputs). Page 59 NOTE 2 CASH AND INVESTMENTS At June 30, 2019 the City’s investments included the following: Investment Type U.S. Treasuries Federal Agency Securities Corporate Notes Negotiable Certificates of Deposit Money Market Fund Mutual Funds Total Total $ 48,359,531 11,213,067 23,780,621 12,137,093 64,452 511,597 $ 96,066,361 Remaining Maturity (in Years) More Concentration Less than 1 1 to 2 than 2 of Credit Risk $ 1,591,563 $ 18,347,310 $28,420,659 49% 6,388,528 4,824,539 12% 2,849,495 11,173,435 9,757,692 25% 4,644,674 7,492,419 13% 64,452 0% 511,597 1% $ 9,661,781 $ 43,401,691 $43,002,889 100% Custodial Credit Risk To control custodial credit risk, State law and 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. Interest Rate Risk Interest rate risk is the risk of changes in market interest rates that will adversely affect the fair value of an investment. In order to limit interest rate and market risk, State law and the City’s investment policy sets a maximum maturity on any investment to five years. In addition, the City has adopted an average portfolio duration limitation (ranging from 90 days to three years) consistent with the primary investment objective of safety, liquidity and yield. As of June 30, 2019 the average duration to maturity is 1.91 years. Credit Risk Credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. Although the City’s investment policy states that it will mitigate credit risk it does not impose any specific limitations. Concentration of Credit Risk The City’s investment policy limits the diversification on both security types and length of maturity. At the time of purchase a maximum of five percent of the market value of the portfolio may be invested in debt issues by any single entity. Debt backed by the U.S. Treasury or Government Sponsored Enterprises (GSEs) are exempt from this concentration criterion. Page 60 NOTE 3 RECEIVABLES Receivables, net of allowance for uncollectibles, as of year-end for the City’s individual major governmental funds and non-major governmental funds in the aggregate are as follows: Receivables: General Fund Taxes $ GO Bond Debt Capital Projects Fund Ballpark Special Revenue Fund 9,568,034 $ - $ - McDowell Road Commercial Corridor ID Debt Service Community Facilities Districts Debt Service Non-Major Governmental Funds $ $ $ - 147,136 619,141 Total $ 10,334,311 Interest 257,785 6,541 141,718 - - 55,792 461,836 Accounts 2,201,710 40,595 - - 50,012 3,433 2,295,750 - - - 52,875,104 - - Special assessments - Notes Total Receivables 1,675,250 $ 13,702,779 $ 47,136 $ 141,718 28,910,000 23,965,104 $ 28,910,000 $ - 24,162,252 $ 678,366 1,675,250 $ 67,642,251 As of June 30, 2019, the special assessment and notes receivable balances are not expected to be collected within the next year. Special assessment receivables will be collected in conjunction with the debt retirement schedule for the related bonds outstanding. The notes receivable mature in 2044 and accrue interest at 3.26 percent annum. The following table summarizes the City’s receivables for the proprietary funds as of June 30, 2019. Receivables: Water and Wastewater Fund Sanitation Fund Interest $ $ Accounts 177,814 4,988 Total $ 182,802 5,051,264 1,021,605 6,072,869 5,229,078 1,026,593 6,255,671 Less: Allowance Total Receivables 74,707 $ 5,154,371 $ 28,238 102,945 998,355 $ 6,152,726 Revenues of the Water & Wastewater Fund and Sanitation Fund are reported net of uncollectible amounts. Total bad debt expense related to the Water & Wastewater Fund revenues and Sanitation Fund revenues for the current year are $112,282 and $35,561, respectively. Page 61 NOTE 4 CAPITAL ASSETS A summary of capital assets activity for the fiscal year ended June 30, 2019 follows: Governmental activities: Beginning Balance Increase Decrease Ending Balance Capital assets, not being depreciated: Land $ Artwork 28,984,564 $ 1,212,748 $ - $ 30,197,312 256,115 20,000 - 276,115 Construction in progress 9,107,572 6,979,376 11,146,116 4,940,832 Right of way 90,844,947 - - 90,844,947 Streetscape 9,061,008 - - 9,061,008 138,254,206 8,212,124 11,146,116 135,320,214 Total capital assets, not being depreciated Capital assets, being depreciated: Land improvements 4,669,247 - - 4,669,247 Infrastructure 397,902,121 7,890,635 603,705 405,189,051 Buildings and improvements 284,567,983 2,686,763 318,850 286,935,896 Vehicles, furniture and equipment 48,014,300 4,615,029 654,329 51,975,000 735,153,651 15,192,427 1,576,884 748,769,194 Total capital assets, being depreciated Less accumulated depreciation for: Land improvements Infrastructure (1,670,038) (376,242) - (2,046,280) (125,447,896) (9,022,892) - (134,470,788) (80,276,634) Buildings and improvements (71,339,545) (9,021,168) 84,079 Vehicles, furniture and equipment (30,269,733) (3,960,614) 749,174 (33,481,173) Total accumulated depreciation (228,727,212) (22,380,916) 833,253 (250,274,875) Total capital assets, being depreciated, net 506,426,439 Governmental activities capital assets, net $ 644,680,645 Business-type activities: Beginning Balance as restated $ (7,188,489) 743,631 1,023,635 $ 11,889,747 Increase Decrease 498,494,319 $ 633,814,533 Ending Balance Capital assets, not being depreciated: Land $ Artwork Construction in progress Total capital assets, not being depreciated 7,570,661 $ 199,411 $ - $ 7,770,072.00 146,978 - - 146,978 12,015,646 24,374,238 1,408,676 34,981,208 19,733,285 24,573,649 1,408,676 42,898,258 Capital assets, being depreciated: Infrastructure 216,161,613 2,670,628 - 218,832,241 Buildings and improvements 114,585,625 919,846 - 115,505,471 Vehicles, furniture and equipment 16,058,536 692,712 115,955 16,635,293 Water rights 20,046,104 440,422 - 20,486,526 366,851,878 4,723,608 115,955 371,459,531 Infrastructure (51,940,901) (4,120,640) - (56,061,541) Buildings and improvements (23,757,032) (3,146,387) - (26,903,419) Vehicles, furniture and equipment (9,851,627) (726,664) 115,994 (10,462,297) Total capital assets, being depreciated Less accumulated depreciation for: Water rights Total accumulated depreciation Total capital assets, being depreciated, net Business-type activities capital assets, net (2,016,413) (197,309) - (2,213,722) (87,565,973) (8,191,000) 115,994 (95,640,979) 279,285,905 $ 299,019,190 Page 62 $ (3,467,392) (39) 21,106,257 $ 1,408,637 275,818,552 $ 318,716,810 NOTE 4 CAPITAL ASSETS Depreciation expense was charged to functions/programs as follows: Governmental activities: General government $ 511,648 Public safety 3,221,544 Highway and streets 13,433,282 Culture and recreation 3,858,248 Public works 1,356,194 Total depreciation expense $ 22,380,916 $ 8,030,481 Business-type activities: Water and wastewater Sanitation 160,519 Total depreciation expense $ 8,191,000 NOTE 5 LOAN PAYABLE The City received a loan from the Water Infrastructure Finance Authority. The loan was used for expansion of an effluent wastewater facility and to rehabilitate an existing effluent lift station. The loan payable at June 30, 2019, is as follows: Description Interest Rate (Including Fees) 2.00% Maturity Outstanding Principal June 30, 2019 Due Within One Year 7/1/20-29 $ 3,050,815 $ 278,620 $ 3,050,815 $ 278,620 Business-type activities Water Infrastructure Finance Authority Loan Total business-type activities Annual debt service requirements to maturity on the loans payable at June 30, 2019 are summarized as follows: Business-type Activities Year ending June 30: Principal 2020 Total $ 278,620 Interest $ 61,016 2021 284,193 55,444 2022 289,877 49,760 2023 295,674 43,962 2024 301,588 38,050 2025-29 1,600,863 97,320 $ Page 63 3,050,815 $ 345,552 NOTE 6 GENERAL OBLIGATION BONDS PAYABLE Bonds payable at June 30, 2019, consisted of the outstanding general obligation and refunding bonds presented below. The bonds are generally callable with interest payable semi-annually. Of the total amounts originally authorized, $115,681,616 remains unissued. The bonds payable at June 30, 2019 are presented below. Purpose Interest Rates Governmental activities: General Obligation Bonds Refunding Series 2010 (Build America Bonds) 5.40-6.00% General Obligation Bonds Refunding Series 2016 2.00-4.00% General Obligation Bonds Series 2017 3.00-5.00% General Obligation Bonds Series 2019 2.00-3.00% Total governmental activities Business-type activities: General Obligation Bonds Refunding Series 2010 (Build America Bonds) General Obligation Bonds Refunding Series 2010 General Obligation Bonds Refunding Series 2014 General Obligation Bonds Refunding Series 2016 General Obligation Bonds Refunding Series 2019 Total business-type activities Remaining Maturities 7/1/20-30 Outstanding Principal June 30, 2019 Due Within One Year $ 105,000 $ 105,000 $ 16,657,751 20,300,000 26,960,000 64,022,751 $ 2,514,907 450,000 1,655,000 4,724,907 $ 5,710,000 $ - 7/1/20-37 7/1/20-37 7/1/20-38 5.40-6.30% 7/1/21-30 4.018-5.125% 7/1/21-30 4,610,000 - 3.60-4.00% 7/1/2020 3,150,000 3,150,000 2.00-4.00% 7/1/20-37 31,382,246 1,170,093 3.00-5.00% 7/1/27-29 4,105,000 48,957,246 $ 4,320,093 $ 112,979,997 $ 9,045,000 $ Total Annual debt service requirements to maturity on general obligation bonds payable at June 30, 2019 are summarized as follows: Year ending June 30: 2020 2021 2022 2023 2024 2025-29 2030-34 2035-39 Total Governmental Activities Principal Interest $ 4,724,907 $ 2,068,641 4,503,314 1,976,383 1,620,698 1,828,609 1,643,495 1,795,711 2,688,629 1,729,455 14,939,888 7,144,843 17,569,601 4,502,190 16,332,219 1,323,138 $ 64,022,751 $ 22,368,970 Business-type Activities Principal Interest $ 4,320,093 $ 1,886,337 2,921,667 1,752,779 3,169,301 1,621,054 3,251,504 1,528,864 3,426,371 1,386,208 18,940,111 4,599,862 8,150,399 1,418,484 4,777,800 290,522 $ 48,957,246 $ 14,484,110 On May 29, 2019, the City issued $26,960,000 of new general obligation bonds and $4,225,000 of refunding bonds. The new bonds have an average interest rate of 2.98 percent and the refunding bonds have an average interest rate of 5.00 percent. The net proceeds of $32,599,869, that included a bond premium of $1,899,503, (after payment of $421,682 in underwriting fees, insurance, and other issuance costs) were immediately split between the City capital project funds ($26,877,000) to finance public infrastructure and an escrow agent ($5,722,869) for the purposes of refunding general obligation bonds. In addition to the funds available for the refunding, the City contributed $604,314 in cash to the effort. The refunding was undertaken to reduce total debt service payments by $2,202,029 over the next eleven years and resulted in an economic gain of $1,211,750. Page 64 NOTE 7 REVENUE BONDS PAYABLE Revenue bonds payable at June 30, 2019 consisted of the outstanding revenue bonds and refunding bonds presented below. The bonds are generally callable after 10 years with interest payable semi-annually. The bonds payable at June 30, 2019 are presented below: Interest Rates Purpose Governmental activities: Public Improvement Corporation Municipal Facilities Revenue Bonds, Series 2011A 2.00-5.25% Public Improvement Corporation Municipal Facilities Revenue Refunding Bonds, Series 2016A 3.00-5.00% Public Improvement Corporation Municipal Facilities Revenue Refunding Bonds, Series 2016B 4.00-5.00% McDowell Road Commercial Corridor Improvement District Refunding Bonds, Series 2018 1.95-3.60% Total Direct borrowings or direct placements: Public Improvement Corporation Municipal Facilities Tax-Exempt Revenue Bonds, Series 2012A 2.48% Public Improvement Corporation Municipal Facilities Taxable Revenue Bonds, Series 2012B 3.44% Public Improvement Corporation Subordination Municipal Facitilties Revenue Bonds, Series 2017 3.31% Total direct borrowings or direct placements Remaining Maturities 7/1/20-27 Due Within One Year $ $ 24,015,000 245,000 7/1/20-32 37,570,000 3,090,000 7/1/20-31 25,650,000 1,795,000 1/1/20-31 28,910,000 116,145,000 2,240,000 7,370,000 12/15/20-6/15/23 3,866,249 931,126 12/15/20-6/15/23 470,277 111,624 7/1/20-27 8,805,000 13,141,526 980,000 2,022,750 Total governmental activities Business-type activities: Revenue Bonds, Series 2009 Revenue Bonds, Series 2010 Revenue Bonds, Series 2011 Revenue Bonds, Series 2016 Total business-type activities Outstanding Principal June 30, 2019 6.75% 5.00-5.625% 2.00-5.50% 2.00-5.00% 7/1/49 7/1/22-39 7/1/20-41 7/1/20-45 $ 129,286,526 $ 9,392,750 $ 325,000 14,950,000 13,310,000 8,590,000 37,175,000 $ $ 345,000 1,045,000 1,390,000 $ 166,461,526 $ 10,782,750 $ Total Revenue bond debt service requirements to maturity are as follows: Year ending June 30: 2020 2021 2022 2023 2024 2025-29 2030-34 2035-39 2040-44 2045-49 Total Principal 7,370,000 7,670,000 7,990,000 8,330,000 8,690,000 49,570,000 26,525,000 $ 116,145,000 $ $ $ Governmental Activities Direct borrowings or direct placements Interest Principal Interest 4,868,425 $ 2,022,750 $ 396,817 4,564,132 2,079,858 337,271 4,241,695 2,142,682 276,017 3,896,493 2,206,236 212,877 3,532,578 1,115,000 155,239 11,502,480 3,575,000 239,148 1,647,005 34,252,808 $ 13,141,526 $ 1,617,369 Page 65 Business-type Activities Principal 1,390,000 1,480,000 835,000 875,000 920,000 5,270,000 9,505,000 12,380,000 3,770,000 750,000 $ 37,175,000 $ $ $ Interest 1,904,381 1,848,781 1,808,531 1,767,444 1,727,319 7,928,463 6,143,182 3,269,643 661,590 130,932 27,190,266 NOTE 7 REVENUE BONDS PAYABLE Pledged Revenue A. Revenue Bonds Revenue bonds are collateralized by a pledge of the gross revenues of the utility systems, as defined in the bond indentures. The bonds are payable solely from water and wastewater customer net revenues with the last scheduled debt service payment occurring on 7/1/2049. Proceeds of the bonds were used for improvements to the City’s water and wastewater system. Principal and interest paid for the current year and total water and wastewater customer net revenues were $3,627,518 and $23,074,011, respectively. B. Public Improvement Corporation Municipal Facilities Revenue Bonds The public improvement corporation municipal facilities revenue bonds are secured by excise taxes or other undesignated general fund revenues and the property referred to as Goodyear Municipal Complex. Proceeds from the bonds were used to construct a major league baseball training facility as well as other municipal facilities. The last scheduled debt service payment on the bonds is 7/1/2032. Principal and interest paid for the current year and total pledged revenues were $10,403,216 and $90,636,231, respectively. C. McDowell Road Corridor Improvement District Bonds The City acts as an administrator for the McDowell Road Corridor Improvement District whereby it collects the assessments levied against owners of property within the established district and disburses the amounts collected to retire the bonds issued to finance infrastructure improvements. The last scheduled debt service payment on the bond is 1/1/2031. At June 30, 2019, the special assessments receivable, together with amounts paid in advance and interest to be received over the life of the assessment period, is adequate for the scheduled maturities of the bonds payable and the related interest. Principal and interest paid for the current year and total net revenues and fund balance available to service the debt were $7,451,718 and $7,744,262, respectively. The McDowell Road Corridor Improvement District bonds are collateralized by properties within the district. In the event of default by the property owner(s), the City may enforce an auction sale to satisfy the debt service requirements of the improvement bonds. The City is contingently liable on the bonds to the extent that proceeds from auction sales are insufficient to retire outstanding bonds. Page 66 NOTE 8 COMMUNITY FACILITIES DISTRICTS BONDS PAYABLE Community Facilities District General Obligation Bonds are issued by Community Facilities Districts (CFDs), which are special purpose districts created specifically to acquire and improve public infrastructure in specified land areas. CFD bonds are repaid by ad valorem taxes levied directly by the districts and collected by the county. Property owners in the districts are assessed for district taxes and thus for all costs associated with the districts. The City has no liability for CFD bonds. Community facilities district bonds payable at June 30, 2019 consisted of outstanding general obligation and special assessment bonds. The bonds are generally callable with interest payable semiannually. Community facilities district bonds payable at June 30, 2019, are presented below. Purpose Interest Rates General District No. 1: General Obligation Refunding Bonds, Series 2013 5.00% Palm Valley: General Obligation Refunding Bonds, Series 2016 2.00-4.00% Utilities District No. 1: General Obligation Refunding Bonds, Series 2014 4.00% General Obligation Refunding Bonds, Series 2015 3.00-4.125% General Obligation Refunding Bonds, Series 2016 2.00-4.00% Wildflower Ranch District 1: General Obligation Bonds, Series 1997 6.50% General Obligation Bonds, Series 1998 5.70-5.75% Wildflower Ranch District 2: General Obligation Bonds, Series 2000 6.75-7.00% General Obligation Bonds, Series 2001 5.875-5.90% Estrella Mountain Ranch: Special Assessment Revenue Bonds, Series 2015 2.50-5.00% General Obligation Refunding Bonds, Series 2017 3.00-5.00% Special Assessment Revenue Bonds Series 2019 Lucero 2.60-4.75% Total Direct borrowings or direct placements: Centerra: General Obligation Refunding Bonds, Series 2016 2.70% General Obligation Bonds, Series 2016 2.70% Cortina: General Obligation Refunding Bonds, Series 2017 3.18% Cottonflower: General Obligation Refunding Bonds, Series 2017 2.92% Estrella Mountain Ranch: Special Assessment Revenue Refunding Bonds Series 2018 Desert Village 3.15% Special Assessment Revenue Refunding Bonds Series 2018 Golf Village 2.81% Special Assessment Revenue Refunding Bonds Series 2018 Golf Village 2 3.67% Special Assessment Revenue Refunding Bonds Series 2018 Montecito 2 3.75% Total direct borrowings or direct placements Total Outstanding Principal June 30, 2019 Due Within One Year 7/15/28 $ 7,740,000 $ 670,000 7/15/32 $ 5,320,000 $ 340,000 Remaining Maturities 7/15/28 7/15/29 7/15/32 8,514,298 5,445,000 17,270,000 210,000 430,000 630,000 7/15/22 7/15/23 145,000 245,000 45,000 45,000 7/15/25 7/15/26 290,000 335,000 40,000 40,000 7/1/39 7/1/32 4,399,000 11,925,000 142,000 725,000 7/1/43 6,913,000 68,541,298 3,317,000 7/15/31 7/15/31 2,587,000 323,000 182,000 - 7/15/31 1,745,000 120,000 7/15/28 1,700,000 170,000 7/1/26 1,815,000 262,000 7/1/24 1,526,000 353,000 7/1/30 4,478,000 373,000 7/15/31 4,940,000 19,114,000 362,000 1,822,000 $ Page 67 87,655,298 $ 5,139,000 NOTE 8 COMMUNITY FACILITIES DISTRICTS BONDS PAYABLE Community Facilities District bonds debt service requirements to maturity are as follows: Year ending June 30: 2020 2021 2022 2023 2024 2025-29 2030-34 2035-39 2040-44 Total Principal 3,317,000 3,771,000 4,188,000 4,693,000 4,773,000 25,759,000 17,155,000 3,271,000 1,614,298 $ 68,541,298 $ $ $ Governmental Activities Direct borrowings or direct placements Interest Principal Interest 2,838,228 $ 1,822,000 $ 633,346 2,667,638 1,896,000 574,218 2,520,223 1,951,000 512,677 2,350,231 1,900,000 449,331 2,159,258 1,865,000 387,118 7,815,562 7,621,000 1,070,500 2,799,989 2,059,000 101,031 903,950 210,664 24,265,743 $ 19,114,000 $ 3,728,221 On April 16, 2019, the Estrella Mountain Ranch Community Facilities District issued $6,913,000 in special assessment revenue bonds, with an average interest rate of 4.462 percent. The net proceeds of $6,774,740, plus an additional contribution of $319,260 from the major landowner, (after payment of $319,260 in underwriting fees, insurance, and other issuance costs) were immediately transferred to the district to finance public infrastructure. NOTE 9 CHANGES IN LONG-TERM LIABILITIES Long-term liabilities activity for the year ended June 30, 2019 was as follows: Beginning Balance, as restated Additions Reductions Ending Balance Due Within One Year $ $ Governmental activities: Compensated absences payable $ 6,058,984 $ 5,080,086 $ 5,099,522 6,039,548 2,296,030 General obligation bonds payable 41,990,387 26,960,000 4,927,636 64,022,751 4,724,907 Community Facilities District bonds payable 64,751,298 6,913,000 3,123,000 68,541,298 3,317,000 Direct borrowings or direct placements-CFD 20,011,000 - 897,000 19,114,000 1,822,000 Public improvement bonds payable 92,124,999 - 4,889,999 87,235,000 5,130,000 Direct borrowings or direct placements-PIC 15,107,865 - 1,966,339 13,141,526 2,022,750 Revenue bonds payable 34,870,000 - 5,960,000 28,910,000 2,240,000 Premiums 17,853,644 667,265 1,439,042 17,081,867 - Discounts (34,529) - (1,644) (32,885) - Net OPEB liability 197,696 59,301 - 256,997 - Net pension liability 61,330,306 5,068,659 - 66,398,965 Governmental activities long-term liabilities $ 354,261,650 $ $ $ 44,748,311 $ 426,458 $ 28,300,894 $ 384,558 $ - 370,709,067 $ 590,661 $ 21,552,687 Business-type activities: Compensated absences payable 548,761 General obligation bonds payable 55,074,633 Revenue bonds payable 38,515,000 Loans payable - Direct borrowing 3,323,972 Premiums Discounts Net OPEB liability Net pension liability Business-type activities long-term liabilities 4,225,000 212,771 10,342,387 48,957,246 4,320,093 - 1,340,000 37,175,000 1,390,000 - 273,157 3,050,815 278,620 4,301,319 901,350 300,300 4,902,369 - (489,821) - (22,227) (467,594) - 12,911 8,060 - 20,971 - 5,533,032 $ 106,819,807 $ Page 68 5,560,868 36,868 $ 12,655,043 5,496,164 $ 99,725,632 $ 6,201,484 NOTE 9 CHANGES IN LONG-TERM LIABILITIES The City’s outstanding notes from direct borrowings and direct placements related to community facilities districts’ debt of $19,114,000 are secured by either (1) an ad valorem tax on all taxable property; (2) an assessment levied on each lot in the assessment district; or (3) a debt reserve fund. These notes contain a provision that in the event of default the interest rate will increase and the legal rights of the creditor will be enforced. The City’s outstanding notes from direct borrowings and direct placements related to the Public Improvement Corporation’s debt of $13,141,526 are secured by the lease rental payments received pursuant to a Taxable and a Tax-Exempt Lease Agreement. These outstanding notes contain a provision that in an event of default the interest rate will increase and the legal rights of the creditor will be enforced. The City’s outstanding note from direct borrowings and direct placements related to the business-type activities of $3,050,815 is secured by pledged water and wastewater revenues. This outstanding note contains a provision that in an event of default a late charge of 6% per annum will be charged and the legal rights of the creditor will be enforced. NOTE 10 INTERFUND RECEIVABLES, PAYABLES, AND TRANSFERS At June 30, 2019, interfund balances were as follows: Receivable Amount General Fund $ 1,536,175 Non-Major Governmental Funds Total Payable Amount $ $ 1,536,175 1,536,175 $ 1,536,175 Interfund balances resulted from (1) the borrowing of cash to cover cash deficits. All interfund balances are expected to be paid within one year. Transfers during the fiscal year were as follows: Transfers Out General Fund $ 14,254,246 Transfers In $ 3,700,000 Ball Park Fund - 12,364,604 Non-Major Governmental Funds - 1,889,642 Water and Wastewater Fund 5,056,487 Sanitation Fund Total 900,000 $ 20,210,733 2,256,487 $ 20,210,733 All transfers made during the year were to cover operations or debt service as approved during budget development. NOTE 11 CONTINGENT LIABILITIES Federal and State grants and loans - The City has received a number of grants and loans from both the Federal and State governments. Although the programs have been audited, not all audits have been approved as of June 30, 2019; however, the City expects no material disallowances of expenditures. Lawsuits - The City is a defendant in various lawsuits. Although the outcome of these lawsuits is not presently determinable, in the opinion of the City’s legal counsel, the resolution of these matters will not have a material adverse effect on the financial condition of the City. Page 69 NOTE 11 CONTINGENT LIABILITIES Commitments - The City is contingently liable for payments from the general fund to entities that the City has entered into job credit agreements for establishing businesses within the City. These credits will be paid out when the established criteria are met for job creation and other economic growth factors as specified by the development agreements. Each year the City appropriates for these obligations through the budget process. NOTE 12 RISK MANAGEMENT The City is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors and omissions; and natural disasters. The City’s property and liability insurance protection is provided by the Arizona Municipal Risk Retention Pool, of which the City is a participating member. The Arizona Municipal Risk Retention Pool is structured such that member premiums are based on an actuarial review that will provide adequate reserves to allow the pool to meet its expected financial obligations. The pool has authority to assess its members additional premiums should reserve and annual premiums be insufficient to meet the pool’s obligations. During the year ended June 30, 2019, the City established a Self-Insurance Trust (an Internal Service Fund) to account for and finance its uninsured risks of loss related to healthcare benefits. Under this program, the Fund provides coverage for up to a maximum of $250,000 for each claim, not to exceed an annual aggregate of $8,110,193. The Fund purchases commercial insurance for claims in excess of this coverage. Settled claims have not exceeded this coverage in any of the past four fiscal years. Liabilities of the fund 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 (IBNRs). The result of the process to estimate the claims liability is not an exact amount as it depends on many complex factors, such as inflation, changes in legal doctrines, and damage awards. Accordingly, claims are reevaluated periodically to consider the effects of inflation, recent claim settlement trends (including frequency and amount of pay-outs), and other economic and social factors. The estimate of the claims liability also includes amounts for incremental claim adjustment expenses related to specific claims and other claim adjustment expenses regardless of whether allocated to specific claims. Estimated recoveries, for example from subrogation, are another component of the claims liability estimate. Changes in the balances of claims liabilities during the past two years are as follows: Current Year Claims and Changes in Estimates Claims Payable Beginning of Year Healthcare Benefits 2018-19 $ 479,747 $ 6,933,269 Claims Payable at End of Year Claim Payments $ 6,961,401 $ 451,615 The City continues to carry commercial insurance for workers compensation. Settled claims have not exceeded commercial insurance coverage in any of the past four fiscal years. Page 70 NOTE 13 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS The City contributes to the plans described below. The plans are component units of the State of Arizona. Aggregate Amounts. At June 30, 2019, the City reported the following aggregate amounts related to pensions and other postemployment benefits (OPEB) for all plans to which it contributes. FY2019 Business-type Activities Governmental Activities Net pension and OPEB assets $ 122,586 $ 14,681 Total $ 137,267 Net pension and OPEB liability 66,655,962 5,517,135 72,173,097 Deferred outflows of resources 24,604,951 1,220,323 25,825,274 Deferred inflows of resources 5,072,806 709,155 5,781,961 Pension and OPEB expense 10,813,358 333,502 11,146,860 The City reported $10,813,358 of pension and OPEB contributions as expenditures in the governmental funds related to all plans to which it contributes. A. Arizona State Retirement System Plan Description. City employees participate in the Arizona State Retirement System (ASRS). The ASRS administers a cost-sharing multiple-employer defined benefit pension plan, a cost-sharing multiple-employer defined benefit health insurance premium benefit (OPEB) plan, and a costsharing 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 the ASRS website at www.azasrs.gov. Benefits Provided. The ASRS provides retirement, health insurance premium supplement, longterm disability, and survivor benefits. State statute establishes benefit terms. Retirement benefits are calculated on the basis of age, average monthly compensation, and service credit 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 and 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 months of last 120 months Highest 60 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. Page 71 NOTE 13 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS Retired and disabled members, with at least five years of credited service, are eligible to receive health insurance premium benefits. 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 $150 per month to $215 per month depending on the age of the member and dependents. For members with five to nine 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 long-term disability benefit in the event they become unable to perform their work. The monthly benefit is equal to two-thirds of their 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. 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 current fiscal year, active ASRS members were required by statute to contribute at the actuarially determined rate of 11.80 percent (11.64 percent for retirement and 0.16 percent for long-term disability) of the members’ annual covered payroll, and the City was required by statute to contribute at the actuarially determined rate of 11.80 percent (11.18 percent for retirement, 0.46 percent for health insurance premium benefit, and 0.16 percent for long-term disability) of the active members’ annual covered payroll. The City’s contributions for the year ended June 30, 2019 were as follows: Contributions Pension $ 2,891,615 Health Insurance Premium 116,609 Long-Term Disability 42,439 Employers are also required to pay an Alternate Contribution Rate (ACR), for retired members who return to work in positions that would typically be filled by an employee who contributes to ASRS. The City was required by statute to contribute at the actuarially determined rate of 10.53 percent (10.41 for retirement, 0.06 percent for health insurance premium benefit, and 0.06 percent for longterm disability). ACR contributions are included in employer contributions presented above. The City’s pension and OPEB contributions are paid by the same funds as the employee’s salary, with the largest components coming from the General Fund and the Water and Wastewater Fund. Pension and OPEB Assets/Liability. The net pension and OPEB assets/liability were measured as of June 30, 2018. 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, 2017, to the measurement date of June 30, 2018. The City’s proportion of the net asset/liability was based on the City’s actual contributions to the applicable plan relative to the total of all participating employers’ contributions to the plan for the year ended June 30, 2018. Page 72 NOTE 13 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS At June 30, 2019, the City reported the following amounts for its proportionate share of the ASRS plans net assets/liability. In addition, at June 30, 2018, the City’s percentage proportion for each plan and the related change from its proportion measured as of June 30, 2017 was: Net (Assets) Liability Pension $ Increase (Decrease) City % Proportion 37,221,762 0.267 Health Insurance Premium (97,837) 0.272 Long-Term Disability 139,754 0.267 0.02 Pension/OPEB Expense and Deferred Outflows/Inflows of Resources. The City has deferred outflows and inflows of resources related to the net pension and OPEB assets/liability. Certain changes in the net pension and OPEB assets/liability are recognized as pension and OPEB expense over a period of time rather than the year of occurrence. For the year ended June 30, 2019, the City recognized pension and OPEB expense as follows: Expense Pension $ 2,268,254 Health Insurance Premium (18,598) Long-Term Disability 9,407 The City reported deferred outflows of resources and deferred inflows of resources related to pensions and OPEB from the following sources: Deferred Outflows of Resources Health Insurance Long-Term Pension Premium Disability Differences between expected and actual experience $ Changes of assumptions or other inputs 1,025,429 $ - $ 3,574 984,956 188,679 30,270 - - - 1,472 9,526 Net difference between projected and actual earnings on pension investments Changes in porportion and differences between contributions and proportionate share of contributions Contributions subsequent to the measurement date Total 2,807,434 2,891,615 $ 7,709,434 116,609 $ 306,760 42,439 $ 85,809 Deferred Inflows of Resources Health Insurance Long-Term Pension Premium Disability Differences between expected and actual experience $ Changes of assumptions or other inputs 205,197 $ 90,299 $ - 3,300,220 - - 895,095 195,443 13,537 Net difference between projected and actual earnings on pension investments Changes in porportion and differences between contributions and proportionate share of contributions Total Page 73 99,711 $ 4,500,223 127 $ 285,869 11 $ 13,548 NOTE 13 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS The amounts of deferred outflows of resources resulting from contributions subsequent to the measurement date as reported in the table above will be recognized as an adjustment of the net pension and OPEB assets/liability in the year ended June 30, 2019. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions and OPEB will be recognized in pension and OPEB expense as follows: Year Ending June 30: Health Insurance Premium Pension $ (37,594) Long-Term Disability 2020 $ 1,639,621 $ 1,731 2021 437,185 (37,595) 1,732 2022 (1,357,794) (37,595) 1,732 2023 (401,416) 4,046 5,358 2024 - 13,020 6,023 Thereafter - - 13,246 Actuarial Assumptions. The significant actuarial assumptions used to measure the total pension and OPEB liability are as follows: Actuarial valuation date Actuarial roll forward date Actuarial cost method Investment rate of return Projected salary increases Inflation Permanent base increases Mortality rates Recovery rates Healthcare cost trend rate June 30, 2017 June 30, 2018 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 The actuarial assumptions used in the June 30, 2018 valuation were based on the results of an actuarial experience study for the five-year period ended June 30, 2016. The purpose of the experience study was to review actual experience in relation to the actuarial assumptions in effect. The ASRS Board adopted the experience study recommended changes which were applied to the June 30, 2017, actuarial valuation. The study did not include an analysis of the assumed investment rate of return. The long-term expected rate of return on ASRS plan investments was determined to be 7.5 percent using a building-block method in which best-estimate ranges of expected future real rates of return (expected returns, net of investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. The target allocation and best estimates of arithmetic real rates of return for each major asset class for all ASRS plans are summarized in the following table: Asset Class Equity Fixed income Real estate Total Target Allocation 50% 30% 20% 100% Page 74 Long-Term Geometric Real Rate of Return 5.50% 3.83 5.85 NOTE 13 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS Discount Rate. The discount rate used to measure the ASRS total pension and OPEB liability was 7.5 percent, which was a decrease of 0.5 from the discount rate used as of June 30, 2018. The projection of cash flows used to determine the discount rate assumed that contributions from participating employers will be made based on the actuarially determined rates based on the ASRS Board’s funding policy, which establishes the contractually required rate under Arizona statute. Based on those assumptions, the 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 investments was applied to all periods of projected benefit payments to determine the total pension and OPEB liability. Sensitivity of the Proportionate Share of the Net Pension and OPEB Assets/Liability to Changes in the Discount Rate. The following presents the City’s proportionate share of the net pension and OPEB assets/liability calculated using the discount rate of 7.5 percent, as well as what the proportionate share of the net pension and OPEB assets/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: Proportionate share of the net (assets) liability 1% Decrease Rate Pension Current Discount Rate 6.5% $ 19,881,029 1% Increase 7.5% $ 13,946,481 8.5% $ 8,988,261 Health Insurance Premium 127,589 (36,009) (175,362) Long-Term Disability 59,214 52,250 45,494 Pension and OPEB Plan Fiduciary Net Position. Detailed information about the pension and OPEB plan’s fiduciary net position is available in the separately issued ASRS financial report. The report is available on the ASRS website at www.azasrs.gov. B. Public Safety Personnel Retirement System Plan Descriptions. City public safety employees who are regularly assigned hazardous duty participate in the Public Safety Personnel Retirement System (PSPRS). The PSPRS administers an agent multiple-employer defined benefit pension plan and an agent multiple-employer defined benefit health insurance premium benefit (OPEB) plan. 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. Employees 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 cost-sharing plans (PSPRS Tier 3 Risk Pool). The PSPRS issues a publicly available financial report that includes their financial statements and required supplementary information. The report is available on the PSPRS website at www.psprs.com. Page 75 NOTE 13 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS Benefits Provided. The PSPRS provides retirement, health insurance premium supplement, disability, and survivor benefits. State statute establishes benefits terms. Certain retirement, disability, and survivor benefits are calculated on the basis of age, average monthly compensation, and service credit as follows. See the publicly available PSPRS financial report for additional benefits information. Retirement Initial Membership Date: Tier 1 20 years of service, any age or 15 years of service, age 62 Tier 2 25 years or 15 years of credited service, age 52.5 Tier 3 15 years of credited service, age 52.5 or 15 or more years of service, age 55 Final average salary is based on Highest 36 consecutive months of last 20 years Highest 60 consecutive months of last 20 years Highest 60 consecutive months of last 15 years Normal retirement 50% less 4.0% for each 1.5 % to 2.5% per year year of credited of credited service, service less than 20 not to exceed 80% years or plus 2.0% to 2.5% for each year of credited service over 20 years, not to exceed 80% 50% or normal retirement, whichever is greater 1.5 % to 2.5% per year of credited service, not to exceed 80% Years of service and age required to receive benefit Accidental disability retirement Catastrophic disability retirement 90% of 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 Active members 80% to 100% of retired member’s pension benefit 80% of accidental disability retirement benefit or 100% of average monthly compensation if death was the result of injuries received on the job 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. Page 76 NOTE 13 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS Employees Covered by Benefit Terms. At June 30, 2019 the following employees were covered by the agent plan’s benefit terms: PSPRS - Police Health Insurance Pension Retirees and beneficiaries PSPRS - Fire 24 Health Insurance Pension 24 10 10 Inactive, non-retired members 19 3 5 5 Active members 100 100 80 80 143 127 95 95 Total 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. Contributions rates for the year ended June 30, 2019, are indicated below. Rates are a percentage of active members’ annual covered payroll. Tier 1 & 2 PSPRS - Police Active members - pension Tier 3 PSPRS - Fire 7.65% to 11.65% PSPRS - Police PSPRS - Fire 9.68% 9.68% 25.08% 20.25% City of Gooyear: Pension 30.37% 26.19% Health insurance 0.33% 0.34% Employers are also required to pay an Alternate Contribution Rate (ACR), for retired members who return to work in positions that would typically be filled by an employee who contributes to PSPRS. The City was required by statute to contribute at the actuarially determined rate of 10.65 percent for the PSPRS. ACR contributions are included in employer contributions presented above. The contributions to the pension and OPEB plans for the year ended were: Pension Pension - Tier 2 Pension - Tier 3 Health insurance Health insurance - Tier 2 Health insurance - Tier 3 Contributions PSPRS - Police PSPRS - Fire $ 2,009,159 $ 2,098,502 847,895 148,063 150,519 116,036 21,831 27,243 9,213 1,922 1,636 1,506 The City’s pension and OPEB contributions are paid by the same funds as the employee’s salary, with the largest component coming from the General Fund. Page 77 NOTE 13 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS Pension and OPEB Assets/Liability. At June 30, 2019, the City reported the following assets and liabilities. Net (Asset) Liability Pension PSPRS - Police PSPRS - Fire $ 19,361,024 $ 15,312,345 (39,430) 138,215 Health insurance The net pension and OPEB assets/liability were measured as of June 30, 2018. The total liability used to calculate the net asset or liability was determined by an actuarial valuation as of that date. The total liability as of June 30, 2018, reflects statutory changes in benefit terms for automatic costof-living adjustments. The basis of cost-of-living adjustments was changed from excess investment earnings to the change in the consumer price index, limited to a maximum annual increase of 2 percent. Actuarial Assumptions. The significant actuarial assumptions used to measure the total pension/OPEB liability are as follows: Actuarial valuation date June 30, 2018 Actuarial cost method Entry age normal Investment rate of return Wage inflation 7.4% 3.5% for pensions/not applicable for OPEB Price inflation 2.5% for pensions/not applicable for OPEB Cost-of-living adjustment Mortality rates Included for pensions/not applicable for OPEB RP-2014 tables using MP-2016 improvement scale with adjustments to match current experience Healthcare cost trend rate Not applicable Actuarial assumptions used in the June 30, 2018, valuation were based on the results of an actuarial experience study for the 5-year period ended June 30, 2016. The long-term expected rate of return on PSPRS plan investments was determined to be 7.40 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: Asset Class Short-term investments Risk parity Fixed income Real assets GTS Private credit Real estate Private equity Non-U.S. equity U.S. equity Total Target Allocation 2% 4% 5% 9% 12% 16% 10% 12% 14% 16% 100% Page 78 Long-Term Expected Geometric Real Rate of Return 0.25% 5.00% 1.25% 4.52% 3.96% 6.75% 3.75% 5.83% 8.70% 7.60% NOTE 13 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS Discount Rate. At June 30, 2018, the discount rate used to measure the total pension and OPEB liability was 7.4 percent, which was the same as the discount rate used as of June 30, 2017. The projection of cash flows used to determine the PSPRS discount rates 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 for these plans to determine the total pension and OPEB liability. Page 79 NOTE 13 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS Changes in Net (Assets)/Liability Total (Assets) Liability Pension Health Insurance Increase (Decrease) Plan Fiduciary Net Position Net (Assets) Liability Increase (Decrease) Net Plan Total (Assets) Fiduciary Net (Assets) Liability Position Liability $ $ $ 770,990 PSPRS - Police Balances at June 30, 2018 $ 44,597,544 26,773,045 17,824,499 $ 836,535 $ (65,545) Change for the year: Service cost 2,123,570 - 2,123,570 30,980 - 30,980 Interest on the total liability 3,331,300 - 3,331,300 57,711 - 57,711 - - - 11,892 - 11,892 Changes of benefit terms - - - Differences between expected and actual experience in the measurement of the liability 1,802,331 - 1,802,331 Changes of assumptions or other inputs - Contributions - employer - Contributions - employee - Net investment income - - - - - (3,953,950) - - 17,033 (17,033) 947,565 (947,565) - - - 1,918,567 (1,918,567) - 58,322 (58,322) (2,419,504) 1,135,981 (13,196) (13,196) - (29,900) 29,900 - (888) 888 3,953,950 Benefit payments, including refunds of employee contributions (1,283,523) Administrative expense - Other changes - Net changes Balances at June 30, 2019 5,973,678 $ 50,571,222 Total (Assets) Liability $ 66,475 (66,475) - 4,437,153 1,536,525 87,387 19,361,024 $ 858,377 31,210,198 $ $ 1 (1) 61,272 26,115 897,807 Pension Health Insurance Increase (Decrease) $ (39,430) Plan Fiduciary Net Position Net (Assets) Liability Increase (Decrease) Net Plan Total (Assets) Fiduciary Net (Assets) Liability Position Liability $ $ $ 772,067 PSPRS - Fire Balances at June 30, 2018 $ 41,458,577 29,891,179 11,567,398 $ 648,893 $ 123,174 Change for the year: Service cost 2,044,963 - 2,044,963 22,849 - 22,849 Interest on the total liability 3,111,423 - 3,111,423 57,087 - 57,087 - - - 2,063 - 2,063 Changes of benefit terms - - - Differences between expected and actual experience in the measurement of the liability 4,118,805 - 4,118,805 Changes of assumptions or other inputs - Contributions - employer - Contributions - employee - Net investment income (869,611) - - - - - (3,893,514) - - 22,840 (22,840) 905,341 (905,341) - - - 2,135,563 (2,135,563) - 44,799 (44,799) (2,293,703) 1,424,092 (24,100) (24,100) (33,203) 33,203 - 3,893,514 Benefit payments, including refunds of employee contributions Administrative expense Other changes - Net changes Balances at June 30, 2019 8,405,580 $ 49,864,157 $ 53,121 (53,121) - 4,660,633 3,744,947 57,899 15,312,345 $ 829,966 34,551,812 Page 80 $ (682) $ 682 1 (1) 42,858 15,041 691,751 $ 138,215 NOTE 13 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS Sensitivity of the Net Pension and OPEB Assets (Liability) to Changes in the Discount Rate. The following presents the City/Town’s net pension and OPEB assets (liability) calculated using the discount rates noted above, as well as what the net assets (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 Current Discount Rate 1% Increase PSPRS - Police 6.40% 7.40% 8.40% Net pension (assets) liability Rate $ 27,548,280 $ 19,361,024 $ 12,801,915 Net OPEB (assets) liability 82,640 (39,430) (139,713) 6.40% 7.40% 8.40% Net pension (assets) liability $ 23,891,412 $ 15,312,345 Net OPEB (assets) liability 261,478 138,215 PSPRS - Fire Rate $ 8,429,279 36,979 Plan Fiduciary Net Position. Detailed information about the plans’ fiduciary net position is available in the separately issued PSPRS financial report. The report is available on the PSPRS website at www.psprs.com. Expense. For the year ended June 30, 2019, the City recognized the following as pension and OPEB expense: Expense Pension PSPRS - Police PSPRS - Fire $ $ Health insurance 4,576,735 15,108 Page 81 4,274,946 21,369 NOTE 13 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS Deferred Outflows/Inflows of Resources. At June 30, 2019, the City reported deferred outflows of resources and deferred inflows of resources related to pensions and OPEB from the following sources: Pension Deferred Deferred Outflows of Inflows of Resources Resources Health Insurance Deferred Deferred Outflows of Inflows of Resources Resources PSPRS - Police Differences between expected and actual experience $ Changes of assumptions or other inputs 2,249,213 $ 70,770 $ 13,912 $ - 2,049,925 - - 48,856 284,443 - - 16,148 - - - - Net difference between projected and actual earnings on plan investments Changes in proportion and differences between contributions and proportionate share of contributions Contributions subsequent to the measurement date Total 3,007,572 $ - 32,680 - 7,591,153 $ 70,770 $ 46,592 $ 5,748,218 $ 759,244 $ 18,696 $ 65,004 PSPRS - Fire Differences between expected and actual experience $ Changes of assumptions or other inputs - 1,694,354 - - 75,298 309,332 - - 12,002 - - - - Net difference between projected and actual earnings on plan investments Changes in proportion and differences between contributions and proportionate share of contributions Contributions subsequent to the measurement date Total 2,362,601 $ 10,114,505 Page 82 $ 759,244 30,671 $ 49,367 $ 87,300 NOTE 13 PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS The amounts of deferred outflows of resources resulting from contributions subsequent to the measurement date as reported in the table above will be recognized as an adjustment of the net pension and OPEB assets/liability in the year ended June 30, 2019. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions and OPEB will be recognized in pension and OPEB expense as follows: PSPRS - Police Health Pension Insurance Year Ending June 30: 2020 $ 1,234,980 $ (12,457) 2021 1,067,817 2022 584,343 2023 PSPRS - Fire Health Pension Insurance $ 1,120,841 $ (11,302) (12,457) 942,714 (11,302) (12,457) 595,022 (11,302) 711,028 (6,089) 828,367 (6,460) 2024 363,654 (6,828) 794,403 (7,091) Thereafter 550,989 (804) 2,711,313 (21,147) C. Goodyear Volunteer and Reserve Firefighter Retirement Trust Plan The Goodyear Volunteer and Reserve Firefighter Retirement Trust Plan is a single-employer defined contribution plan, which was approved by the City Council on February 27, 1990, under Arizona Revised Statutes Section 9-981. The authority to establish and amend benefit provisions rests with the City Council. In December 1999, the council revised the pension and benefit program for the part-time firefighters. The City discontinued using part-time firefighters as of December 1, 2005. The assets of the plan are valued annually and the earnings or loss is distributed among the participant’s accounts in the plan. The only expenditures being made from this fund are administration fees, benefit payments, and refunds to those firefighters who leave the service of the Fire Department before becoming eligible for pension benefits. The cost of administering the plan is financed from investment earnings. Retirement with full benefits can be at age fifty (50) or fifteen years of credited service. This plan was fully vested as of June 30, 2019. As of June 30, 2019, there were five eligible employees participating in the plan. The plan is administered by Innes Associates LTD. As of June 30, 2019, the plan’s assets consisted of the following: Investments $478,394 The plan has never had an actuarial valuation; however, benefits cannot exceed plan assets. The market values of mutual funds are determined from readily available market quotations. The fund uses the accrual basis of accounting. Contributions are recognized when earned; benefits and refunds are expensed when incurred. Separate audited financial statements of this employee benefit plan are not available. Page 83 NOTE 14 EXCESS OF EXPENDITURES OVER APPROPRIATIONS For the year ended, June 30, 2019, expenditures did not exceed budget at the fund level in any funds. NOTE 15 FUND BALANCE CLASSIFICATIONS General Fund Fund Balances (deficits): Nonspendable Inventory Prepaid items Restricted Capital projects Charter mandates Court Law enforcement Debt service Development impact fees Transit Community facilities districts operations Committed Ball park Assigned IT replacement Fleet replacement Risk management Parks management Police asset reserve Fire asset reserve Traffic signal reserve General Fund FY2020 Budget Unassigned Total fund balances $ 311,940 1,402,473 4,582,213 294,594 470,847 1,189,336 - 1,988,219 3,910,722 805,987 3,280,541 156,142 738,260 1,362,099 55,747,287 16,546,219 $ 92,786,879 Ball Park $ - GO Bonds Capital Projects McDowell Road Commerical Corridor ID Debt Service Fund Community Facilities Districts Debt Service Fund Non-Major Governmental Funds Total Governmental Funds $ $ $ $ $ 43,953,339 - 2,555,378 $ 2,555,378 292,545 - 5,402,017 - 678,548 249 219,210 29,633,601 10,164,456 990,488 1,402,473 43,953,339 4,582,213 294,594 471,096 5,913,772 29,633,601 1,189,336 10,164,456 - - - - 2,555,378 - - - - 1,988,219 3,910,722 805,987 3,280,541 156,142 738,260 1,362,099 55,747,287 16,357,325 $ 185,497,328 $ 43,953,339 Page 84 - $ 292,545 $ 5,402,017 (188,894) $ 40,507,170 NOTE 16 COMMITMENTS The City has active construction projects as of June 30, 2019. The commitments for these active projects are being financed from existing fund balances. The balances for work not yet complete as of June 30, 2019 were as follows: General Fund: Questica Budget Software Implementation C2100013 FSIP - Tyler/Munis Implementation C2100008 EMR Fire Station C3000003 New EM590 DIF Pumper C3000003 Unit 382 Replacement Pumper Fire Station 181 C3000004 New World Systems C3500003 Public Art – Recreation Center C50PA004 86 Acre Rec Campus Harrison St C4200001 Recreation Campus Estrella Pkwy Offsite C4200002 Recreation Campus RID Relocation C4200003 Sarival Ave - Jefferson to Yuma Rd C4200005 Traffic Signal – Estrella-San Miguel C4200013 GO Bonds Capital Projects: Fire Station 181 New C3000004 Aquatic Facility C5000001 $ 255,850 270,925 347,862 764,612 652,285 528,843 137,120 14,500 2,837,975 1,960,169 859,766 219,397 434,345 9,283,649 496,093 491,367 987,460 Non-Major Governmental Funds: Non-Utility DI Fees - EMR Fire Station FD1801/C3000003 Non-Utility DI Fees - 30 Acre Recreation Campus 50002 Non-Utility DI Fees - Recreation Center C5000002 Water & Wastewater Fund: Site #12 Water Main/Improvements C60WA001 GY Well # 26 C60WA002 Surface Water Project C60WA003 Adaman Well & Treatment C60WA004 Liberty Interconnect Project C60WA005 GWRF Expansion 4 to 5 MGD C60WW001 QS 59 Sewer Pipe Rehab C60WW003 347,862 3,574,274 1,874,148 5,796,284 10,440,939 1,858,148 6,386,304 2,194,133 267,300 6,355,439 178,813 27,681,076 $ 43,748,469 Total commitments NOTE 17 TAX ABATEMENT AGREEMENTS GPLET The City enters into government property lease agreements with private parties. All property taxes are abated on these lease agreements; however, the private party may be subject to a government property lease excise tax (GPLET) in lieu of property taxes. GPLET is calculated based on rates state statute establishes on the property’s square footage and use. The property tax abatement applies to private parties developing and occupying a government property for at least 30 consecutive days. Under the City’s government property lease agreements, private parties are committed to the construction of any improvements and the operation and maintenance of the improvements. The City has no commitments under these agreements other than to abate taxes. Page 85 NOTE 17 TAX ABATEMENT AGREEMENTS For the year ended June 30, 2019, government property lease agreements the City entered into reduced the City tax revenues by $372,659. Foreign Trade Zone The City has a foreign trade zone within its limits. Arizona state law allows for any property within a foreign trade zone to be subject to a reduced property valuation rate of 5% down from 18%. Under the City’s foreign trade zones, business can qualify one of four ways: 1. Developers can construct a zone I-1 site of at least 200,000 square feet in a foreign trade zone. 2. Qualifying manufacturing companies can invest at least $25 million in capital equipment and real property, construct a 75,000 square feet building, employ a minimum of 75 full-time employees with 51% paid 125% of the state median annual wage and paid 75% of employees’ health insurance premiums. 3. Internet fulfillment companies can locate within a designated foreign trade zone building, generate a minimum of $25 million of Arizona end-user sales and invest at least $25 million in capital equipment and real property. 4. Businesses can locate within one of the federally approved Magnet foreign trade zones and comply with the City’s Foreign Trade Zone policy and federal requirements. For the year ended June 30, 2019, properties within the foreign trade zones reduced the City tax revenues by $178,727. Sales Tax Abatements The City has entered into agreements with developers to reimburse for the construction of public infrastructure that will benefit the community. These reimbursements are paid to developers over time from the collection of sales taxes. Payments to developers are considered during the City's budget process. For the year ended June 30, 2019, the one developer agreement reduced City sales tax revenues by $1,818,002. NOTE 18 PRIOR PERIOD ADJUSTMENT In the previous fiscal year, governmental activities construction in progress was overstated by $2,734,769 and assessments receivable was overstated by $1,178,000. As a result, a prior period adjustment has been recorded in the current fiscal year to decrease governmental activities net position by $3,912,769. Page 86 REQUIRED SUPPLEMENTARY INFORMATION Page 87 CITY OF GOODYEAR, ARIZONA GENERAL FUND Schedule of Revenues, Expenditures, and Changes in Fund Balance Budget and Actual For the Year Ended June 30, 2019 Budgeted Amounts Original REVENUES Taxes Licenses and permits Intergovernmental revenues Charges for services Fines and forfeitures Investment income Contributions Other revenues Total revenues EXPENDITURES Current: General government: City attorney City clerk City manager Communications Finance Human resources ITS Mayor and council Non-departmental Reserved for contingency $ 65,984,900 6,968,800 20,803,600 2,507,300 836,700 425,000 602,500 2,547,000 100,675,800 Final $ 65,984,900 6,968,800 20,803,600 2,507,300 836,700 425,000 602,500 2,547,000 100,675,800 Actual $ 72,619,200 12,314,128 21,244,411 2,909,107 928,097 2,833,485 2,419,466 836,195 116,104,089 Variance with Final Budget $ 6,634,300 5,345,328 440,811 401,807 91,397 2,408,485 1,816,966 (1,710,805) 15,428,289 1,714,500 980,700 5,823,700 6,491,500 1,709,500 5,381,000 338,700 4,748,000 24,513,700 1,714,500 960,200 2,406,100 951,700 6,064,800 4,491,400 5,479,770 338,700 3,248,000 24,190,500 1,574,689 715,308 2,070,643 829,933 4,166,560 3,582,880 4,720,875 279,647 2,017,478 - 139,811 244,892 335,457 121,767 1,898,240 908,520 758,895 59,053 1,230,522 24,190,500 51,701,300 49,845,670 19,958,013 29,887,657 22,215,800 1,429,400 25,504,300 22,270,400 1,419,698 25,509,500 18,083,327 1,184,564 23,674,338 4,187,073 235,134 1,835,162 49,149,500 49,199,598 42,942,229 6,257,369 Public works: Administration Building services Fleet services Program management 518,800 2,860,700 600 409,100 518,800 2,799,500 50,146 409,100 493,066 2,071,019 32,746 230,777 25,734 728,481 17,400 178,323 Total public works 3,789,200 3,777,546 2,827,608 949,938 Total general government Public safety: Fire Municipal Court Police Total public safety (Continued) Page 88 CITY OF GOODYEAR, ARIZONA GENERAL FUND Schedule of Revenues, Expenditures, and Changes in Fund Balance Budget and Actual For the Year Ended June 30, 2019 Budgeted Amounts Original Culture and recreation: Arts and culture Parks Recreation Final Actual Variance with Final Budget 188,000 7,451,400 2,077,000 202,800 7,826,800 1,988,000 180,171 7,096,618 1,889,908 22,629 730,182 98,092 9,716,400 10,017,600 9,166,697 850,903 3,449,700 1,168,400 3,560,800 3,778,300 2,677,100 4,306,000 3,375,067 967,638 3,299,099 403,233 1,709,462 1,006,901 8,178,900 10,761,400 7,641,804 3,119,596 Capital Outlay 14,140,000 13,451,286 8,872,249 4,579,037 Debt Service Principal Interest 1,256,300 153,900 1,256,300 153,900 1,256,338 153,984 (38) (84) 1,410,200 1,410,200 1,410,322 (122) 138,085,500 138,463,300 92,818,922 45,644,378 Excess of revenues over expenditures (37,409,700) (37,787,500) 23,285,167 61,072,667 OTHER FINANCING SOURCES (USES) Sale of capital assets Transfers out Transfers in Total other financing sources and (uses) (23,443,300) 10,350,000 (13,093,300) (16,793,300) 3,700,000 (13,093,300) 320,846 (14,254,246) 3,700,000 (10,233,400) 320,846 2,539,054 2,859,900 Net change in fund balance (50,503,000) (50,880,800) 13,051,767 63,932,567 Fund balance, beginning of year 77,780,334 77,780,334 77,780,334 - 90,832,101 $ 63,932,567 Total culture and recreation Development services: Development services Economic development Engineering Total development services Total debt service Total expenditures Fund balance, end of year $ 27,277,334 Page 89 $ 26,899,534 $ CITY OF GOODYEAR, ARIZONA BALLPARK Schedule of Revenues, Expenditures, and Changes in Fund Balance Budget and Actual For the Year Ended June 30, 2019 Budgeted Amounts Original Final Actual Variance with Final Budget REVENUES Charges for services Investment income Contributions Miscellaneous $ Total revenues 3,857,600 2,000 66,000 - $ 3,857,600 2,000 66,000 - $ 2,561,561 76,916 1,344,967 379 $ (1,296,039) 74,916 1,278,967 379 3,925,600 3,925,600 3,983,823 58,223 6,311,300 2,184,300 6,311,300 2,184,300 4,941,775 674,130 1,369,525 1,510,170 5,600,000 4,571,700 5,600,000 4,571,700 5,600,000 4,566,272 5,428 18,667,300 18,667,300 15,782,177 2,885,123 (14,741,700) (14,741,700) (11,798,354) 2,943,346 EXPENDITURES Current: Culture and recreation Capital outlay Debt Service: Principal Interest Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Sale of Assets Transfers in Total other financing sources (uses) 13,556,900 13,556,900 25,278 12,364,604 25,278 (1,192,296) 13,556,900 13,556,900 12,389,882 (1,167,018) Net change in fund balance (1,184,800) (1,184,800) 591,528 1,776,328 Fund balance, beginning of year 1,963,850 1,963,850 1,963,850 - Fund balance, end of year $ 779,050 $ Page 90 779,050 $ 2,555,378 $ 1,776,328 CITY OF GOODYEAR, ARIZONA Notes to Budget and Actual Schedules For the Year Ended June 30, 2019 Note 1. Budgetary Basis of Accounting The City’s budget is prepared on a basis consistent with generally accepted accounting principles, except for the following items:  Certain activities reported in the General Fund are budgeted in separate funds. The following schedule reconciles fund balance reported at the end of the year: Statement of Revenues, Expenditures and Changes in Fund Balances - Governmental Funds Activity budgeted as special revenue funds Schedule of Revenues, Expenditures and Changes in Fund Balances - General Fund Beginning Fund Balance Revenue Expenditures Ending Fund Balance $ 79,516,713 $ 120,507,117 $ 107,236,951 $ 92,786,879 (1,736,379) (382,182) (163,783) (1,954,778) $ 77,780,334 $ 120,124,935 $ 107,073,168 $ 90,832,101 Page 91 CITY OF GOODYEAR, ARIZONA Required Supplementary Information Schedule of the Proportionate Share of the Net Pension Liability June 30, 2019 Reporting Fiscal Year (Measurement Date) 2018 2017 2016 (2017) (2016) (2015) ASRS - Pension 2019 (2018) 2015 (2014) Proportion of the net pension liability (asset) 0.27% 0.24% 0.24% 0.24% 0.22% Proportionate share of the net pension liability (asset) $ 37,221,762 $ 37,471,443 $ 39,085,443 $ 36,986,742 $ 33,264,817 Covered payroll $ 25,325,110 $ 23,806,419 $ 22,599,315 $ 21,761,494 $ 20,166,769 Proportionate share of the net pension liability (asset) as a percentage of its covered payroll 146.98% 157.40% 172.95% 169.96% 164.95% Plan fiduciary net position as a percentage of the total pension liability 73.40% 69.92% 67.06% 68.35% 69.49% Note: The City implemented GASB 68 in fiscal year 2015. Prior year information is not available Page 92 CITY OF GOODYEAR, ARIZONA Required Supplementary Information Schedule of the Proportionate Share of the Net OPEB Liability June 30, 2019 ASRS - Health insurance premium benefit Reporting Fiscal Year (Measurement Date) 2019 2018 (2018) (2017) Proportion of the net OPEB (asset) 0.271700% (97,837) 0.243230% Proportionate share of the net OPEB (asset) $ $ (132,414) Covered payroll $ 25,325,110 $ 23,806,419 Proportionate share of the net OPEB (asset) as a percentage of its covered payroll -0.39% -0.56% Plan fiduciary net position as a percentage of the total OPEB liability 102.20% 103.57% ASRS - Long-term disability Reporting Fiscal Year (Measurement Date) 2019 2018 (2018) (2017) Proportion of the net OPEB (asset) 0.267470% 139,754 0.241210% Proportionate share of the net OPEB (asset) $ $ 87,433 Covered payroll $ 25,325,110 $ 23,806,419 Proportionate share of the net OPEB (asset) as a percentage of its covered payroll 0.55% 0.37% Plan fiduciary net position as a percentage of the total OPEB liability 77.83% 84.44% Note: The City implemented GASB 75 in fiscal year 2018. Prior year information is not available. Page 93 CITY OF GOODYEAR, ARIZONA Required Supplementary Information Schedule of Changes in the Net Pension Liability and Related Ratios June 30, 2019 Reporting Fiscal Year (Measurement Date) 2018 2017 2016 (2017) (2016) (2015) PSPRS Police - Pension 2019 (2018) Total pension liability Service cost Interest on total pension liability Changes of benefit terms Difference between expected and actual experience of the total net pension liability Changes of assumptions Benefit payments, including refunds of employee contributions Net change in total pension liability Total pension liability - beginning Total pension liability - ending (a) 2015 (2014) $ 2,123,570 3,331,300 - $ 1,914,605 2,971,515 456,529 $ 1,437,416 2,477,882 3,357,342 $ 1,278,133 2,301,498 - $ 1,278,071 1,966,048 186,683 1,802,331 - 494,534 824,808 389,465 1,580,891 (159,382) - 260,090 1,746,183 (1,283,523) 5,973,678 44,597,544 $ 50,571,222 (1,454,686) 5,207,305 39,390,239 $ 44,597,544 (1,398,856) 7,844,140 31,546,099 $ 39,390,239 (1,107,068) 2,313,181 29,232,918 $ 31,546,099 (1,220,650) 4,216,425 25,016,493 $ 29,232,918 Plan fiduciary net position Contributions - employer Contributions - employee Net investment income Benefit payments, including refunds of employee contributions Hall/Parker settlement Plan administrative expenses Other (net transfer) Net change in plan fiduciary net position Plan fiduciary net position - beginning Plan fiduciary net position - ending (b) $ 3,953,950 947,565 1,918,567 $ 1,633,633 930,370 2,810,340 $ 1,597,875 885,129 130,212 $ 1,173,950 768,858 739,152 $ 1,116,495 704,171 2,311,670 (1,283,523) (1,135,981) (29,900) 66,475 4,437,153 26,773,045 $ 31,210,198 (1,454,686) (25,267) 333,337 4,227,727 22,545,318 $ 26,773,045 (1,398,856) (19,137) 167,861 1,363,084 21,182,234 $ 22,545,318 (1,107,068) (18,421) (57,781) 1,498,690 19,683,544 $ 21,182,234 (1,220,650) (476,423) 2,435,263 17,248,281 $ 19,683,544 Net pension liability - ending (a) - (b) $ 19,361,024 $ 17,824,499 $ 16,844,921 $ 10,363,865 $ 9,549,374 Plan fiduciary net position as a percentage of the total pension liability 61.72% 60.03% 57.24% 67.15% 67.33% $ 9,388,019 $ 8,331,614 $ 7,375,148 $ 7,012,489 $ 6,630,426 206.23% 213.94% 228.40% 147.79% 144.02% Covered payroll Net pension liability as a percentage of covered payroll Note: The City implemented GASB 68 in fiscal year 2015. Information prior to 2015 is not available. Page 94 CITY OF GOODYEAR, ARIZONA Required Supplementary Information Schedule of Changes in the Net Pension Liability and Related Ratios June 30, 2019 Reporting Fiscal Year (Measurement Date) 2018 2017 2016 (2017) (2016) (2015) PSPRS Fire - Pension 2019 (2018) Total pension liability Service cost Interest on total pension liability Changes of benefit terms Difference between expected and actual experience of the total net pension liability Changes of assumptions Benefit payments, including refunds of employee contributions Net change in total pension liability Total pension liability - beginning Total pension liability - ending (a) 2015 (2014) $ 2,044,963 3,111,423 - $ 1,819,328 2,846,014 208,024 $ 1,558,056 2,121,084 4,046,976 $ 1,409,380 1,822,450 - $ 1,405,013 1,640,015 (18,156) 4,118,805 - (389,024) 222,373 1,915,498 1,632,401 1,030,908 - (813,497) 619,565 (869,611) 8,405,580 41,458,577 $ 49,864,157 (570,665) 4,136,050 37,322,527 $ 41,458,577 (385,270) 10,888,745 26,433,782 $ 37,322,527 (680,367) 3,582,371 22,851,411 $ 26,433,782 (341,865) 2,491,075 20,360,336 $ 22,851,411 $ 3,893,514 905,341 2,135,563 $ 1,153,600 1,109,821 3,112,669 $ 1,173,975 992,221 141,788 $ $ (869,611) (1,424,092) (33,203) 53,121 4,660,633 29,891,179 $ 34,551,812 (570,665) (27,942) 301 4,777,784 25,113,395 $ 29,891,179 (385,270) (20,803) 278,213 2,180,124 22,933,271 $ 25,113,395 (680,367) (19,707) 304,136 2,212,551 20,720,720 $ 22,933,271 (341,865) (228,831) 3,506,696 17,214,024 $ 20,720,720 Net pension liability - ending (a) - (b) $ 15,312,345 $ 11,567,398 $ 12,209,132 $ 3,500,511 $ 2,130,691 Plan fiduciary net position as a percentage of the total pension liability 69.29% 72.10% 67.29% 86.76% 90.68% $ 8,787,982 $ 8,028,810 $ 8,217,597 $ 7,822,842 $ 7,338,829 174.24% 144.07% 148.57% 44.75% 29.03% Plan fiduciary net position Contributions - employer Contributions - employee Net investment income Benefit payments, including refunds of employee contributions Hall/Parker settlement Plan administrative expenses Other (net transfer) Net change in plan fiduciary net position Plan fiduciary net position - beginning Plan fiduciary net position - ending (b) Covered payroll Net pension liability as a percentage of covered payroll Note: The City implemented GASB 68 in fiscal year 2015. Information prior to 2015 is not available. Page 95 968,726 848,048 791,715 948,481 754,465 2,374,446 CITY OF GOODYEAR, ARIZONA Required Supplementary Information Schedule of Changes in the Net OPEB Liability and Related Ratios June 30, 2019 PSPRS Police Health Insurance Premium Benefit Total OPEB liability Service cost Interest on total OPEB liability Changes of benefit terms Difference between expected and actual experience of the total net OPEB liability Changes of assumptions or other inputs Benefit payments 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 expense Other changes Net change in plan fiduciary net position Plan fiduciary net position - beginning Plan fiduciary net position - ending (b) Net OPEB liability - ending (a) - (b) Plan fiduciary net position as a percentage of the total OPEB liability Covered payroll Net OPEB (asset) liability as a percentage of covered payroll Reporting Fiscal Year (Measurement Date) 2019 2018 (2018) (2017) $ $ $ 30,980 57,711 11,892 (13,196) 87,387 770,990 858,377 $ $ $ 27,494 57,481 3,790 4,452 (66,210) (17,372) 9,635 761,355 770,990 $ 17,033 58,322 (13,196) (888) 1 61,272 836,535 897,807 $ 30,113 87,559 (17,372) (774) 99,526 737,009 836,535 $ (39,430) $ (65,545) 104.59% 108.50% $ 9,388,019 $ 8,331,614 -0.42% -0.79% Note: The City implemented GASB 75 in fiscal year 2018. Information prior to 2018 is not available. Page 96 CITY OF GOODYEAR, ARIZONA Required Supplementary Information Schedule of Changes in the Net OPEB Liability and Related Ratios June 30, 2019 PSPRS Fire Health Insurance Premium Benefit Total OPEB liability Service cost Interest on total OPEB liability Changes of benefit terms Difference between expected and actual experience of the total net OPEB liability Changes of assumptions or other inputs Benefit payments 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 expense Other changes Net change in plan fiduciary net position Plan fiduciary net position - beginning Plan fiduciary net position - ending (b) Net OPEB liability - ending (a) - (b) Plan fiduciary net position as a percentage of the total OPEB liability Covered payroll Net OPEB (asset) liability as a percentage of covered payroll Reporting Fiscal Year (Measurement Date) 2019 2018 (2018) (2017) $ 22,849 57,087 - $ 20,875 58,459 375 2,063 (24,100) 57,899 772,067 $ 829,966 21,035 (94,084) (7,230) (570) 772,637 $ 772,067 $ 22,840 44,799 (24,100) (682) 1 42,858 648,893 $ 691,751 $ 31,049 66,973 (7,230) (593) 90,199 558,694 $ 648,893 $ 138,215 $ 123,174 83.35% 84.05% $ 8,787,982 $ 8,028,810 1.57% 1.53% Note: The City implemented GASB 75 in fiscal year 2018. Information prior to 2018 is not available. Page 97 CITY OF GOODYEAR, ARIZONA Required Supplementary Information Schedule of Pension/OPEB Contributions June 30, 2019 ASRS - Pension Reporting Fiscal Year 2017 2016 2019 2018 Contractually required contribution $ 2,993,195 $ 2,760,437 $ 2,566,332 $ 2,452,025 $ 2,369,823 Contributions in relation to the contractually required contribution $ (2,993,195) $ (2,760,437) $ (2,566,332) $ (2,452,025) $ (2,369,823) Contribution deficiency (excess) $ $ $ $ $ Covered payroll $ 23,747,686 $ 25,325,110 $ 23,806,419 $ 22,599,315 $ 21,761,494 12.60% 10.90% 10.78% 10.85% 10.89% 2019 2018 Actuarially determined contribution $ 3,025,459 $ 3,953,950 $ 1,633,633 $ 1,597,875 $ 1,173,950 Contributions in relation to the actuarially determined contribution $ (3,025,459) $ (3,953,950) $ (1,633,633) $ (1,597,875) $ (1,173,950) Contribution deficiency (excess) $ $ $ $ $ Covered-employee payroll $ 9,854,916 $ 9,388,019 $ 8,331,614 $ 7,375,148 $ 7,012,489 30.70% 42.12% 19.61% 21.67% 16.74% - Contributions as a percentage of covered payroll - PSPRS Police-Pension Contributions as a percentage of coveredemployee payroll - Actuarially determined contribution - Reporting Fiscal Year 2017 2016 - PSPRS Fire-Pension - 2015 - 2015 - Reporting Fiscal Year 2017 2016 2019 2018 $ 2,222,428 $ 3,893,514 $ 1,153,600 $ 1,173,975 (2,222,428) (3,893,514) (1,153,600) (1,173,975) Contributions in relation to the actuarially determined contribution - - 2015 $ 968,726 (968,726) Contribution deficiency (excess) $ Covered-employee payroll $ 8,377,037 $ 8,787,982 $ 8,028,810 $ 8,217,597 $ 7,822,842 26.53% 44.30% 14.37% 14.29% 12.38% Contributions as a percentage of coveredemployee payroll - $ - $ - $ Note: The City implemented GASB 68 in fiscal year 2015. Information prior to 2015 is not available. Page 98 - $ - CITY OF GOODYEAR, ARIZONA Required Supplementary Information Schedule of Pension/OPEB Contributions June 30, 2019 Reporting Fiscal Year 2019 2018 ASRS - Health insurance premium benefit Contractually required contribution $ Contributions in relation to the contractually required contribution 120,826 $ (120,826) 143,399 (143,399) Contribution deficiency (excess) $ Covered payroll $ 23,747,686 $ 25,325,110 0.51% 0.57% Contributions as a percentage of covered payroll - $ - Reporting Fiscal Year 2019 2018 ASRS - Long-term disability Contractually required contribution $ Contributions in relation to the contractually required contribution 43,937 $ (43,937) 40,972 (40,972) Contribution deficiency (excess) $ Covered payroll $ 23,747,686 $ 25,325,110 0.19% 0.16% Contributions as a percentage of covered payroll - $ - Note: The City implemented GASB 75 in fiscal year 2018. Information prior to 2018 is not available. Page 99 CITY OF GOODYEAR, ARIZONA Required Supplementary Information Schedule of Pension/OPEB Contributions June 30, 2019 PSPRS Police Health Insurance Premium Benefit Reporting Fiscal Year 2019 2018 2017 Actuarially determined contribution $ 32,521 $ 17,033 $ 30,113 Contributions in relation to the actuarially determined contribution $ (32,521) $ (17,033) $ (30,113) Contribution deficiency (excess) $ - $ - $ - Covered payroll $ 9,854,916 $ 9,388,019 $ 8,331,614 0.33% 0.18% 0.36% Contributions as a percentage of covered payroll PSPRS Fire Health Insurance Premium Benefit Reporting Fiscal Year 2019 2018 2017 Actuarially determined contribution $ 28,482 $ 22,840 $ 31,049 Contributions in relation to the actuarially determined contribution $ (28,482) $ (22,840) $ (31,049) Contribution deficiency (excess) $ - $ - $ - Covered payroll $ 8,377,037 $ 8,787,982 $ 8,028,810 0.34% 0.26% 0.39% Contributions as a percentage of covered payroll Note: The City implemented GASB 75 in fiscal year 2018. Information prior to 2017 is not available. Page 100 CITY OF GOODYEAR, ARIZONA Required Supplementary Information Notes to Pension/OPEB Plan Schedules June 30, 2019 Note 1. Actuarially Determined Contribution Rates Actuarially determined contribution rates for PSPRS are calculated as of June 30 two years prior to the end of the fiscal year in which contributions are made. The actuarial methods and assumptions used to establish the contribution requirements are as follows: Actuarial cost method Amortization Method Remaining Amortization Period as of the 2017 actuarial valuation Entry Age Normal Level percent-of-pay, closed 19 years for unfunded liabilities; 20 years for excess Asset valuation method 7-Year smoothed market; 80%/120% market corridor Actuarial assumptions: Investment rate of return Projected salary increases Wage growth Retirement age Mortality In the 2017 actuarial valuation, the investment rates of return was decreased from 7.5% to 7.4%. In the 2016 actuarial valuation, the investment rate of return was decreased from 7.85% to 7.5%. In the 2013 actuarial valuation, the investment rate of return was decreased from 8.0% to 7.85%. 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%. In the 2017 actuarial valuation, wage growth was decreased from 4% 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% 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. In the 2017 actuarial valuation, changed to RP2014 tables, with 75% of MP-2016 fully generational projection scales. RP-2000 mortality table (adjusted by 105% for both males and females). Page 101 CITY OF GOODYEAR, ARIZONA Required Supplementary Information Notes to Pension/OPEB Plan Schedules June 30, 2019 Note 2. 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 required contributions beginning in fiscal year 2019 for members who retired or will retire after the law’s effective date. Page 102 SUPPLEMENTARY INFORMATION BUDGETARY COMPARISON SCHEDULES MAJOR GOVERNMENTAL FUNDS Capital Projects Funds  GO Bonds Fund – This fund accounts for the proceeds and interest of the sale of voterapproved general obligation bonds that are used for authorized improvements. Debt Service Funds  McDowell Road Commercial Corridor ID Fund – This fund accounts for the debt portion of the McDowell Road Improvement District.  Community Facilities Districts Fund – This fund accounts for the debt portion of the City’s Community Facilities Districts, which are component units that provide general infrastructure and capital assets for the property within each District’s boundaries. Page 103 CITY OF GOODYEAR, ARIZONA GO BONDS Capital Projects Fund Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual For the Year Ended June 30, 2019 Budgeted Amounts Original Final Actual Variance with Final Budget 645,824 $ REVENUES Investment income $ Total revenues - $ - $ 645,824 - - 645,824 645,824 43,190,500 32,283,695 5,528,568 26,755,127 43,190,500 32,283,695 5,528,568 26,755,127 (43,190,500) (32,283,695) (4,882,744) 27,400,951 21,500,000 21,500,000 26,960,000 5,460,000 21,500,000 21,500,000 26,960,000 5,460,000 Net change in fund balances (21,690,500) (10,783,695) 22,077,256 32,860,951 Fund balance, beginning of year 21,876,083 21,876,083 21,876,083 - 185,583 $ 11,092,388 $ 43,953,339 $ 32,860,951 EXPENDITURES Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Debt proceeds Total other financing Sources (Uses) Fund balance, end of year $ Page 104 CITY OF GOODYEAR, ARIZONA MCDOWELL ROAD COMMERCIAL CORRIDOR ID Debt Service Fund Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual For the Year Ended June 30, 2019 Budgeted Amounts Original Final Actual Variance with Final Budget REVENUES Investment income Special assessments Other revenues $ Total revenues 3,534,700 - $ 3,534,700 - $ 59,939 7,558,242 36,686 $ 59,939 4,023,542 36,686 3,534,700 3,534,700 7,654,867 4,120,167 1,750,000 1,785,700 6,100,000 1,785,700 5,960,000 1,491,718 140,000 293,982 3,535,700 7,885,700 7,451,718 433,982 Excess (deficiency) of revenues over (under) expenditures (1,000) (4,351,000) 203,149 4,554,149 Fund balance, beginning of year 89,396 89,396 89,396 - 88,396 $ (4,261,604) EXPENDITURES Debt service: Principal Interest and fiscal charges Total expenditures Fund balance, end of year $ Page 105 $ 292,545 $ 4,554,149 CITY OF GOODYEAR, ARIZONA COMMUNITY FACILITIES DISTRICTS Debt Service Fund Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual For the Year Ended June 30, 2019 Budgeted Amounts Original Final Variance with Final Budget Actual REVENUES Taxes Investment income Special assessments Contributions $ Total revenues 6,398,300 30,800 2,570,100 150,000 $ 6,398,300 30,800 2,570,100 150,000 $ 6,430,913 79,488 2,310,134 195,634 $ 32,613 48,688 (259,966) 45,634 9,149,200 9,149,200 9,016,169 (133,031) 4,706,000 4,431,000 4,706,000 4,431,000 4,020,000 4,302,961 686,000 128,039 9,137,000 9,137,000 8,322,961 814,039 12,200 12,200 693,208 681,008 OTHER FINANCING SOURCES (USES) Payments to refunding escrow Total other financing sources (uses) (1,077,000) (1,077,000) - 1,077,000 (1,077,000) (1,077,000) - 1,077,000 Net change in fund balance (1,064,800) (1,064,800) 693,208 1,758,008 Fund balance, beginning of year 4,708,809 4,708,809 4,708,809 - EXPENDITURES Debt service: Principal Interest and fiscal charges Total expenditures Excess (deficiency) of revenues over (under) expenditures Fund balance, end of year $ 3,644,009 $ Page 106 3,644,009 $ 5,402,017 $ 1,758,008 SUPPLEMENTARY INFORMATION COMBINING STATEMENTS AND BUDGETARY COMPARISON SCHEDULES NON- MAJOR GOVERNMENTAL FUNDS: Special Revenue Funds  Highway User Revenue Fund (HURF) – Funded through fuel taxes distributed from the State of Arizona.  Community Facilities Districts Fund – CFDs represent special districts formed for the purpose of financing the acquisition, construction, operation, and maintenance of the public infrastructure benefiting the community.  Grants Fund – Based on application to granting agencies by the City and availability of funding by grantors. Debt Service Funds  Debt Service Fund – This fund was established for the accumulation of resources and the servicing of long-term debt not being financed by the proprietary funds. Revenues are generated from the property tax levy sufficient to meet the debt service requirements. Capital Projects Funds  Non-Utility Development Impact Fees Fund – This fund accounts for the receipt and expenditure of development impact or expansion fees for all governmental activities. Page 107 CITY OF GOODYEAR, ARIZONA Combining Balance Sheet Nonmajor Governmental Funds June 30, 2019 Special Revenue Highway User Community Revenue Facilities District ASSETS Cash Investments Receivables: Taxes Interest Intergovernmental Accounts Inventories $ Total assets LIABILITIES Accounts payable Accrued wages and salaries Accrued interest Deposits held for others Due to other funds Unearned revenues 1,983,824 - $ 10,168,983 - 497,784 678,548 30,210 3,433 - $ 3,160,156 $ 10,202,626 $ 156,143 $ 318,358 56,636 190,208 1,510,635 594,665 $ $ 1,738 17,644 - Total liabilities DEFERRED INFLOWS OF RESOURCES Unavailable revenues- property taxes Unavailable revenue-intergovernmental Total deferred inflows of resources FUND BALANCES Nonspendable Restricted Unassigned Total fund balances Total liabilities, deferred inflows of resources, and fund balances $ Page 108 Grants 27,909 - $ 102,854 581 52,708 - 2,670,502 27,909 19,382 - 10,261 - 136,512 - 10,261 136,512 678,548 (188,894) 10,164,456 - 249 - 489,654 10,164,456 249 3,160,156 $ 10,202,626 $ 156,143 Capital Projects Non-Utility Development Impact Fees Total 703,989 $ 22,483,111 7,423,376 $ 34,635,918 8,230,219 81,895 4,832 - 507,036 50,379 - 619,141 55,792 550,492 3,433 678,548 $ 790,716 $ 30,463,902 $ 44,773,543 $ 529,285 7,896 - $ $ Debt Service $ $ 99,318 730,983 - 447,323 56,636 529,285 921,191 1,536,175 594,665 537,181 830,301 4,085,275 34,325 - - 44,586 136,512 34,325 - 181,098 219,210 - 29,633,601 - 678,548 40,017,516 (188,894) 219,210 29,633,601 40,507,170 790,716 $ 30,463,902 $ 44,773,543 Page 109 CITY OF GOODYEAR, ARIZONA Combining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Governmental Funds For the Year Ended June 30, 2019 Special Revenue Highway User Revenue REVENUES Taxes Intergovernmental Charges for services Investment income Contributions Other revenues $ Total revenues 5,672,646 44,704 128,703 - Community Facilities Districts $ 1,464,076 99,343 76,699 319,260 Grants $ 541,408 18,669 - 5,846,053 1,959,378 560,077 7,563,123 106,214 843,114 - 373,685 222,006 - 307,672 - - 7,669,337 1,150,786 595,691 Excess (deficiency) of revenues over (under) expenditures (1,823,284) 808,592 (35,614) OTHER FINANCING SOURCES (USES) Debt proceeds Transfers in 1,782,030 6,913,000 - - Total other financing sources (uses): 1,782,030 6,913,000 - Net change in fund balances (41,254) 7,721,592 (35,614) Fund balances, beginning of year 530,908 2,442,864 35,863 EXPENDITURES Current: General government Public safety Public works/streets Capital outlay Debt service: Bond issuance costs Principal Interest and fiscal charges Total expenditures Fund balances, end of year $ Page 110 489,654 $ 10,164,456 $ 249 Debt Service Capital Projects Non-Utility Development Impact Fees $ $ $ 5,138,505 48,559 - 4,648,063 6,488,570 579,951 - Total $ 11,250,644 6,214,054 6,533,274 875,225 76,699 319,260 5,187,064 11,716,584 25,269,156 - 1,643,618 843,114 373,685 7,563,123 1,971,838 246,021 4,927,613 1,531,018 - 553,693 4,927,613 1,531,018 6,704,652 1,643,618 17,764,084 (1,517,588) 10,072,966 7,505,072 958,083 - 107,612 7,871,083 1,889,642 958,083 107,612 9,760,725 (559,505) 10,180,578 17,265,797 778,715 19,453,023 23,241,373 219,210 $ 29,633,601 $ 40,507,170 Page 111 CITY OF GOODYEAR, ARIZONA HIGHWAY USER REVENUE Special Revenue Fund Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual For the Year Ended June 30, 2019 Budgeted Amounts Original Final Actual Variance with Final Budget REVENUES Licenses and permits Intergovernmental revenue Charges for services Investment income $ Total revenues 1,000 5,552,500 15,000 1,500 $ 1,000 5,552,500 15,000 1,500 $ 5,672,646 44,704 128,703 $ (1,000) 120,146 29,704 127,203 5,570,000 5,570,000 5,846,053 276,053 Current: Highways and streets Capital outlay 8,129,900 719,600 8,156,900 657,400 7,563,123 106,214 593,777 551,186 Total expenditures 8,849,500 8,814,300 7,669,337 1,144,963 (3,279,500) (3,244,300) (1,823,284) 1,421,016 EXPENDITURES Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Transfers in Total other financing sources (uses) 3,236,400 3,236,400 1,782,030 (1,454,370) 3,236,400 3,236,400 1,782,030 (1,454,370) Net change in fund balance (43,100) (7,900) (41,254) (33,354) Fund balance, beginning of year 530,908 530,908 530,908 - Fund balance, end of year $ 487,808 $ Page 112 523,008 $ 489,654 $ (33,354) CITY OF GOODYEAR, ARIZONA COMMUNITY FACILITIES DISTRICTS Special Revenue Fund Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual For the Year Ended June 30, 2019 Budgeted Amounts Original Final Actual Variance with Final Budget REVENUES Taxes Investment income Contributions Other revenues $ Total revenues 1,448,000 13,600 90,000 - $ 1,448,000 13,600 90,000 - $ 1,464,076 99,343 76,699 319,260 $ 16,076 85,743 (13,301) 319,260 1,551,600 1,551,600 1,959,378 407,778 1,101,700 1,101,700 843,114 258,586 320,000 320,000 307,672 12,328 1,421,700 1,421,700 1,150,786 270,914 129,900 129,900 808,592 678,692 EXPENDITURES Current: General government Debt service Bond issuance costs Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Debt proceeds Total other financing sources (uses) - - 6,913,000 6,913,000 - - 6,913,000 6,913,000 Net change in fund balance 129,900 129,900 7,721,592 7,591,692 Fund balance, beginning of year 2,442,864 2,442,864 2,442,864 - 2,572,764 $ 10,164,456 Fund balance, end of year $ 2,572,764 $ Page 113 $ 7,591,692 CITY OF GOODYEAR, ARIZONA GRANTS Special Revenue Fund Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual For the Year Ended June 30, 2019 Budgeted Amounts Original Final Actual Variance with Final Budget REVENUES Intergovernmental revenue Investment income $ Total revenues 451,100 - $ 451,100 - $ 541,408 18,669 $ 90,308 18,669 451,100 451,100 560,077 108,977 Current: Public safety Highways and streets Capital outlay 92,100 - 472,700 160,800 225,005 373,685 222,006 99,015 160,800 2,999 Total expenditures 92,100 858,505 595,691 262,814 Net change in fund balance 359,000 (407,405) (35,614) 371,791 Fund balance, beginning of year 35,863 35,863 35,863 - EXPENDITURES Fund balance, end of year $ 394,863 $ Page 114 (371,542) $ 249 $ 371,791 CITY OF GOODYEAR, ARIZONA DEBT SERVICE FUND Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual For the Year Ended June 30, 2019 Budgeted Amounts Variance with Final Budget Original Final Actual $ 5,129,000 5,129,000 $ 5,129,000 5,129,000 $ 5,138,505 48,559 5,187,064 Debt service Bond issuance cost Principal Interest and fiscal charges Total expenditures 4,323,100 1,448,400 5,771,500 260,600 4,927,500 1,533,500 6,721,600 246,021 4,927,613 1,531,018 6,704,652 14,579 (113) 2,482 16,948 Excess (deficiency) of revenues over (under) expenditures (642,500) (1,592,600) (1,517,588) 75,012 REVENUES Taxes Investment income Total revenues $ 9,505 48,559 58,064 EXPENDITURES OTHER FINANCING SOURCES (USES) Debt proceeds Total other financing sources (uses) - - 958,083 958,083 (9,100) - 958,083 958,083 Net change in fund balance (651,600) (1,592,600) (559,505) 1,033,095 Fund balance, beginning of year 778,715 778,715 778,715 - Fund balance, end of year $ 127,115 $ Page 115 (813,885) $ 219,210 $ 1,033,095 CITY OF GOODYEAR, ARIZONA NON-UTILITY DEVELOPMENT IMPACT FEES Capital Projects Fund Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual For the Year Ended June 30, 2019 Budgeted Amounts Original Final Actual Variance with Final Budget $ 3,147,400 11,230,400 - $ 3,147,400 11,230,400 - $ 4,648,063 6,488,570 579,951 $ 1,500,663 (4,741,830) 579,951 14,377,800 14,377,800 11,716,584 (2,661,216) 23,967,400 24,113,400 1,643,618 22,469,782 23,967,400 24,113,400 1,643,618 22,469,782 (9,589,600) (9,735,600) 10,072,966 19,808,566 - - 107,612 107,612 - - 107,612 107,612 Net change in fund balances (9,589,600) (9,735,600) 10,180,578 19,916,178 Fund balance, beginning of year 19,453,023 19,453,023 19,453,023 - $ 9,863,423 $ 9,717,423 $ 29,633,601 $ 19,916,178 REVENUES Taxes Charges for services Investment income Total revenues EXPENDITURES Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Transfers in Total other financing Sources (Uses) Fund balance, end of year Page 116 BUDGETARY COMPARISON SCHEDULES OTHER FUNDS Page 117 CITY OF GOODYEAR, ARIZONA PARK AND RIDE MARQUEE Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual For the Year Ended June 30, 2019 Budgeted Amounts Original Final Non-GAAP Actual Variance with Final Budget $ $ REVENUES Charges for services Investment income Total revenues $ 100,500 - $ 100,500 - 101,756 22,828 1,256 22,828 100,500 100,500 124,584 24,084 Net change in fund balances 100,500 100,500 124,584 24,084 Fund balance, beginning of year 1,064,752 1,064,752 1,064,752 - $ 1,165,252 $ 1,165,252 $ 1,189,336 Fund balance, end of year Page 118 $ 24,084 CITY OF GOODYEAR, ARIZONA COURT ENHANCEMENT Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual For the Year Ended June 30, 2019 Budgeted Amounts Original Final Non-GAAP Actual Variance with Final Budget $ $ REVENUES Fines and forfeits Investment income $ Total revenues 42,000 - $ 42,000 - 68,613 1,768 26,613 1,768 42,000 42,000 70,381 28,381 46,200 46,200 34,627 11,573 Total expenditures 46,200 46,200 34,627 11,573 Net change in fund balances (4,200) (4,200) 35,754 39,954 Fund balance, beginning of year 148,579 148,579 148,579 - EXPENDITURES Current: Public safety Fund balance, end of year $ 144,379 Page 119 $ 144,379 $ 184,333 $ 39,954 CITY OF GOODYEAR, ARIZONA FILL-THE-GAP Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual For the Year Ended June 30, 2019 Budgeted Amounts Original Final Non-GAAP Actual Variance with Final Budget $ $ REVENUES Fines and forfeits Investment income $ Total revenues 7,500 - $ 7,500 - 6,052 1,007 (1,448) 1,007 7,500 7,500 7,059 (441) Net change in fund balances 7,500 7,500 7,059 (441) Fund balance, beginning of year 102,932 102,932 102,932 - Fund balance, end of year $ 110,432 Page 120 $ 110,432 $ 109,991 $ (441) CITY OF GOODYEAR, ARIZONA JCEF Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual For the Year Ended June 30, 2019 Budgeted Amounts Original Final Non-GAAP Actual Variance with Final Budget $ $ REVENUES Fines and forfeits Investment income $ Total revenues 13,000 - $ 13,000 - 16,667 3,209 3,667 3,209 13,000 13,000 19,876 6,876 Net change in fund balances 13,000 13,000 19,876 6,876 Fund balance, beginning of year 90,386 90,386 90,386 - Fund balance, end of year $ 103,386 Page 121 $ 103,386 $ 110,262 $ 6,876 CITY OF GOODYEAR, ARIZONA IMPOUND Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual For the Year Ended June 30, 2019 Budgeted Amounts Original Final Non-GAAP Actual Variance with Final Budget $ $ REVENUES Charges for services Investment income $ Total revenues 140,000 - $ 140,000 - 128,850 6,344 (11,150) 6,344 140,000 140,000 135,194 (4,806) 194,700 - 194,700 - 143 108,922 20,091 (143) 85,778 (20,091) Total expenditures 194,700 194,700 129,156 65,544 Net change in fund balances (54,700) (54,700) 6,038 60,738 Fund balance, beginning of year 302,796 302,796 302,796 - EXPENDITURES Current: General government Public safety Capital outlay Fund balance, end of year $ 248,096 Page 122 $ 248,096 $ 308,834 $ 60,738 CITY OF GOODYEAR, ARIZONA OFFICER SAFETY EQUIPMENT Schedule of Revenues, Expenditures and Changes in Fund Balance Budget and Actual For the Year Ended June 30, 2019 Budgeted Amounts Original Final Non-GAAP Actual Variance with Final Budget $ $ REVENUES Fines and forfeits $ Total revenues 13,000 $ 13,000 25,087 12,087 13,000 13,000 25,087 12,087 Net change in fund balances 13,000 13,000 25,087 12,087 Fund balance, beginning of year 26,936 26,936 26,936 - Fund balance, end of year $ 39,936 Page 123 $ 39,936 $ 52,023 $ 12,087 CITY OF GOODYEAR, ARIZONA WATER AND WASTEWATER Enterprise Fund Schedule of Operations Budget and Actual For the Year Ended June 30, 2019 Budgeted Amounts Original Operating Revenues Charges for services Other revenues $ Total operating revenues 68,339,600 16,500 Original $ 68,339,600 16,500 Actual $ 42,620,408 38,177 Variance with Final Budget $ (25,719,192) 21,677 68,356,100 68,356,100 42,658,585 (25,697,515) Salaries, wages and benefits Cost of sales and services Depreciation 5,618,100 176,387,800 - 5,618,100 175,333,300 - 5,009,783 14,574,791 8,030,481 608,317 160,758,509 (8,030,481) Total operating expenses 182,005,900 180,951,400 27,615,055 153,336,345 (113,649,800) (112,595,300) 15,043,530 127,638,830 Grant revenue Investment income Interest and debt cost Gain (loss) on sale of assets 110,800 143,600 (13,306,700) 12,500 110,800 143,600 (18,571,100) 12,500 1,510,892 (3,878,125) 40,902 (110,800) 1,367,292 14,692,975 28,402 Total non-operating revenue (expense) (13,039,800) (18,304,200) (2,326,331) 15,977,869 (126,689,600) (130,899,500) 12,717,199 143,616,699 Capital contributions Debt proceeds Transfers out Transfers in 46,878,500 63,126,600 (5,056,600) - 46,878,500 63,126,600 (5,056,600) - 12,962,807 (5,056,487) 2,256,487 (33,915,693) (63,126,600) 113 2,256,487 Change in net position (21,741,100) (25,951,000) 22,880,006 48,831,006 233,418,297 233,418,297 233,418,297 - Operating Expenses Operating income (loss) Non-operating Revenues (Expenses) Income (loss) before contributions and transfers Total net position, beginning of year Total net position, end of year $ 211,677,197 $ Page 124 207,467,297 $ 256,298,303 $ 48,831,006 CITY OF GOODYEAR, ARIZONA SANITATION Enterprise Fund Schedule of Operations Budget and Actual For the Year Ended June 30, 2019 Budgeted Amounts Original Operating Revenues Charges for services Other revenues $ Total operating revenues 8,088,400 7,500 Original $ 8,088,400 7,500 Actual $ 8,038,655 19,806 Variance with Final Budget $ (49,745) 12,306 8,095,900 8,095,900 8,058,461 (37,439) Salaries, wages and benefits Cost of sales and services Depreciation 884,600 6,496,400 - 932,200 6,590,600 - 754,359 5,766,256 160,519 177,841 824,344 (160,519) Total operating expenses 7,381,000 7,522,800 6,681,134 841,666 714,900 573,100 1,377,327 804,227 Investment income 8,000 8,000 84,985 76,985 Total non-operating revenue (expense) 8,000 8,000 84,985 76,985 722,900 581,100 1,462,312 881,212 Transfers out (900,000) (900,000) (900,000) - Change in net position (177,100) (318,900) 562,312 881,212 3,449,941 3,449,941 3,449,941 - Operating Expenses Operating income (loss) Non-operating Revenues (Expenses) Income (loss) before contributions and transfers Total net position, beginning of year Total net position, end of year $ 3,272,841 $ Page 125 3,131,041 $ 4,012,253 $ 881,212 Page 126 AGENCY FUNDS  G.A.I.N.  Fill-A-Need  Shop With a Cop  Arizona in Action Page 127 CITY OF GOODYEAR, ARIZONA Combining Statement of Assets and Liabilities Agency Funds June 30, 2019 GAIN Fill-A-Need Shop with a Cop Arizona in Action Totals Assets Cash and cash equivalents Total assets $ $ 8,679 8,679 $ $ 13,536 13,536 $ 28,160 $ 28,160 $ 3,230 $ 3,230 $ 53,605 $ 53,605 Liabilities Deposits held for others Total liabilities $ $ 8,679 8,679 $ $ 13,536 13,536 $ 28,160 $ 28,160 $ 3,230 $ 3,230 $ 53,605 $ 53,605 Page 128 CITY OF GOODYEAR, ARIZONA Combining Statement of Changes in Assets and Liabilities Agency Funds For the Year Ended June 30, 2019 Beginning Balance Additions Ending Balance Deductions GAIN Assets Cash and cash equivalents $ 8,679 $ - $ - $ 8,679 Liabilities Deposits held for others $ 8,679 $ - $ - $ 8,679 FILL-A-NEED Assets Cash and cash equivalents $ 2,901 $ 12,293 $ 1,658 $ 13,536 Liabilities Deposits held for others $ 2,901 $ 12,293 $ 1,658 $ 13,536 SHOP WITH A COP Assets Cash and cash equivalents $ 22,798 $ 10,610 $ 5,248 $ 28,160 Liabilities Deposits held for others $ 22,798 $ 10,610 $ 5,248 $ 28,160 ARIZONA IN ACTION Assets Cash and cash equivalents $ 3,230 $ - $ - $ 3,230 Liabilities Deposits held for others $ 3,230 $ - $ - $ 3,230 TOTAL AGENCY FUNDS Assets Cash and cash equivalents $ 37,608 $ 22,903 $ 6,906 $ 53,605 Liabilities Deposits held for others $ 37,608 $ 22,903 $ 6,906 $ 53,605 Page 129 Page 130 STATISTICAL SECTION The statistical section presents financial statement trends as well as detailed financial and operational information not available elsewhere in the report. The statistical section is intended to enhance the reader’s understanding of the information presented in the financial statements, notes to the financial statements, and other supplementary information presented in this report. The statistical section is comprised of the five categories of statistical information below. Financial Trends These schedules contain trend information to help the reader understand how the City’s financial position and financial activities have changed over time. Revenue Capacity These schedules contain information to help the reader assess the factors affecting the City’s ability to generate revenue. Debt Capacity These schedules present information to help the reader assess the affordability of the City’s current levels of outstanding debt and the government’s ability to issue additional debt in the future. 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. Operating Information These schedules contain information about the City’s operations and various resources to help the reader understand how the information in the City’s financial report relates to the services the government provides and the activities it performs. Note: For locally assessed property (i.e., excluding mines, utilities, etc.) Proposition 117, approved by voters in 2012, amended the Arizona Constitution to require that all property taxes after fiscal year 201415 be based upon property values limited to five percent in annual growth. The aggregate assessed value of all taxable properties within a taxing jurisdiction (i.e., after applying assessment ratios based on the use of a property), including property values with a growth limit, is currently referred to as net limited assessed value and formerly as primary assessed value. In accordance with Proposition 117, this value is used for all taxing purposes beginning fiscal year 2015-16. Aggregate assessed value without a growth limit is currently referred to as net full cash assessed value and formerly as secondary assessed value. This remains the value utilized for determining debt capacity limits. Page 131 City of Goodyear Net Position by Component Last Ten Fiscal Years (accrual basis of accounting) (Unaudited) Fiscal Year 2010 2011 2012* 2013 2014** Governmental Activities Net investment in capital assets Restricted Unrestricted Total Governmental Activities Net Position $ 317,162,459 115,881,050 19,272,548 452,316,057 $ 327,503,686 110,105,296 18,249,626 455,858,608 $ 329,064,345 108,246,415 20,147,669 457,458,429 $ 333,034,884 99,128,020 35,820,702 467,983,606 $ 345,513,895 85,246,465 9,672,461 440,432,821 Business-type Activities Net investment in capital assets Restricted Unrestricted Total Business-type Activities Net Position 191,582,614 4,365,725 195,948,339 179,254,929 3,567,237 9,263,439 192,085,605 178,432,900 3,799,026 11,229,680 193,461,606 178,456,590 3,196,131 16,616,254 198,268,975 177,274,142 5,640,492 9,860,573 192,775,207 Primary Government Net investment in capital assets Restricted Unrestricted Total Primary Government Net Position 508,745,073 115,881,050 23,638,273 $ 648,264,396 506,758,615 113,672,533 27,513,065 $ 647,944,213 507,497,245 112,045,441 31,377,349 $ 650,920,035 511,491,474 102,324,151 52,436,956 $ 666,252,581 522,788,037 90,886,957 9,112,875 $ 622,787,869 Notes: *Net position adjusted for adoption of GASB Statement No. 65 **Net position adjusted for adoption of GASB Statement No. 68 Source: Statement of Net Position Page 132 Table 1 Fiscal Year 2015 2016 2017 2018 2019 $ 365,019,949 92,247,738 5,722,007 462,989,694 $ 361,739,970 92,276,066 19,147,997 473,164,033 $ 379,899,821 90,497,505 16,944,442 487,341,768 $ 381,473,262 87,435,376 29,981,817 498,890,455 $ 342,610,234 149,077,511 43,643,472 535,331,217 176,380,867 7,607,902 14,190,297 198,179,066 180,640,162 18,131,719 7,380,491 206,152,372 181,242,982 21,072,234 15,974,822 218,290,038 199,032,946 13,468,708 24,366,584 236,868,238 227,004,152 6,346,204 26,960,200 260,310,556 541,400,816 99,855,640 19,912,304 $ 661,168,760 542,380,132 110,407,785 26,528,488 $ 679,316,405 561,142,803 111,569,739 32,919,264 $ 705,631,806 580,506,208 100,904,084 54,348,401 $ 735,758,693 569,614,386 155,423,715 70,603,672 $ 795,641,773 Page 133 City of Goodyear Changes in Net Position Last Ten Fiscal Years (accrual basis of accounting) (Unaudited) 2010 2011 2012 2013 2014 Expenses*** Governmental Activities: General government Public safety Community services** Highways and streets Public works Culture and recreation Development services Interest on long-term debt Total Governmental Activities Expenses $ 15,810,359 27,463,658 454,550 12,179,531 11,070,853 4,023,639 2,555,353 11,210,504 $ 84,768,447 $ 17,207,556 28,032,217 14,798,670 3,658,756 4,439,181 5,150,677 10,710,302 $ 83,997,359 $ 18,353,630 25,423,233 13,179,678 4,168,252 4,962,070 6,225,917 10,441,684 $ 82,754,464 $ 17,652,646 27,987,404 14,355,644 3,090,345 5,539,612 7,194,428 10,411,562 $ 86,231,641 $ 18,216,169 30,710,193 19,368,539 2,773,348 5,827,309 5,836,254 9,282,269 $ 92,014,081 Business-type Activities Water and wastewater Sanitation Stadium* Total Business-type Activities Expenses $ 18,124,893 4,782,565 11,547,500 $ 34,454,958 $ 20,733,932 4,815,314 11,958,862 $ 37,508,108 $ 20,654,800 5,154,201 11,634,491 $ 37,443,492 $ 21,912,587 5,246,666 12,204,354 $ 39,363,607 $ 23,511,395 5,472,534 12,529,987 $ 41,513,916 Total Primary Government Expenses $ 119,223,405 $ 121,505,467 $ 120,197,956 $ 125,595,248 $ 133,527,997 Notes: * Stadium Fund did not have operating activity until 2008, and was reclassified to governmental activities in 2017 ** Community Services was reorganized into General Government and Development Services for fiscal year 2011 *** Beginning in fiscal year 2016 expense functions were consolidated to align with the basic financial statements Source: Statement of Activities Page 134 Table 2 2015 $ 19,624,056 31,834,683 17,941,162 3,361,822 6,422,764 7,005,308 8,763,353 $ 94,953,148 2016 $ $ $ 2017 2018 2019 19,824,313 34,823,588 20,753,487 7,920,958 6,880,654 7,981,904 8,479,284 106,664,188 $ 20,151,975 47,535,184 19,181,162 3,569,658 15,363,752 7,316,935 12,131,284 $ 125,249,950 $ 23,781,937 45,439,446 26,460,464 4,232,567 19,080,188 6,591,111 11,582,014 $ 137,167,727 $ 23,478,993 52,241,594 21,330,274 7,972,935 19,083,232 8,380,985 8,797,275 $ 141,285,288 $ 30,139,626 5,868,228 $ 36,007,854 $ 26,853,794 6,206,843 $ 33,060,637 $ 31,493,180 6,681,134 $ 38,174,314 $ 161,257,804 $ 170,228,364 $ 179,459,602 $ 25,489,522 5,802,163 12,407,494 $ 43,699,179 $ 27,647,487 6,444,459 12,647,134 46,739,080 $ 138,652,327 $ 153,403,268 continued Page 135 City of Goodyear Changes in Net Position Last Ten Fiscal Years (accrual basis of accounting) (Unaudited) Fiscal Year 2010 Program Revenue* Governmental Activities: Charges for Services: General government Public safety Highway and streets Public works Culture and recreation Developmental services Operating Grants and Contributions Capital Grants and Contributions Total Governmental Activities Program Revenues Business-type Activities Charges for Services: Water and wastewater Sanitation Stadium* Operating Grants and Contributions Capital Grants and Contributions Total Business-type Activities Revenues $ $ 2011 1,715,692 657,270 287,805 3,615,255 5,648,867 16,436,375 28,361,264 $ $ 1,977,735 628,671 325,552 3,879,823 5,818,158 13,951,581 26,581,520 2012 $ $ 1,691,455 807,498 322,215 4,163,050 7,636,691 9,701,254 24,322,163 2013 $ $ 2,884,854 1,176,336 304,128 6,206,750 4,654,268 11,358,824 26,585,160 2014 $ $ 2,603,723 714,614 433,384 6,899,047 7,565,511 6,171,185 24,387,464 $ 16,258,079 5,790,357 1,530,799 6,211,533 29,790,768 $ 17,634,821 5,774,010 1,564,324 4,570,849 29,544,004 $ 20,105,006 6,115,977 1,633,230 9,252,599 37,106,812 $ 22,667,401 6,368,920 1,741,609 7,987,680 38,765,610 $ 24,767,428 6,641,318 2,182,278 5,962,050 39,553,074 Total Primary Government Revenues $ 58,152,032 $ 56,125,524 $ 61,428,975 $ 65,350,770 $ 63,940,538 Net (Expense)/Revenue Governmental Activities Business-type Activities Total Primary Government Net Revenues $ (56,407,183) $ (57,415,839) $ (58,432,301) $ (59,646,481) $ (67,626,617) (1,960,842) (7,964,104) (336,680) (597,997) $ (4,664,190) $ (61,071,373) $ (65,379,943) $ (58,768,981) $ (60,244,478) $ (69,587,459) Note: * Beginning in fiscal year 2016 program revenues were consolidated to align with the basic financial statements Source: Statement of Activities Page 136 Table 2 Fiscal Year 2015 $ 2016 2,766,974 1,624,427 416,607 5,353,778 10,777,134 8,252,449 29,191,369 $ $ 24,650,687 6,922,425 2,237,359 14,454,883 48,265,354 $ 77,456,723 $ 2017 2,398,256 1,713,627 386,041 7,043,227 9,518,206 12,134,476 33,193,833 $ $ 27,724,410 7,125,427 2,234,046 110,837 11,692,490 48,887,210 $ 82,081,043 $ 2018 2,368,056 1,313,160 3,135,416 9,079,431 10,546,333 12,246,216 38,688,612 $ $ 31,358,803 7,577,840 110,718 13,317,172 52,364,533 $ 91,053,145 $ $ (65,761,779) $ (73,470,355) $ 2,148,130 4,566,175 $ (61,195,604) $ (71,322,225) $ 2019 2,592,414 1,373,556 81,727 2,984,530 10,416,143 16,164,698 7,442,815 41,055,883 $ $ 35,203,483 7,812,267 12,237,823 55,253,573 $ 42,658,585 8,058,461 12,962,807 63,679,853 $ 96,309,456 $ 124,463,452 (96,111,844) $ 22,192,936 (73,918,908) $ (80,501,689) 25,505,539 (54,996,150) $ (86,561,338) $ 16,356,679 (70,204,659) $ $ 4,965,435 6,987,626 382,531 405,393 4,008,274 12,993,399 9,809,818 21,231,123 60,783,599 continued Page 137 City of Goodyear Changes in Net Position Last Ten Fiscal Years (accrual basis of accounting) (Unaudited) Fiscal Year 2010 Revenues and Other Changes in Net Position Governmental Activities: Taxes Intergovernmental Investment income Special assessments* Miscellaneous Transfers Special item - Loss on debt extinguishment Total Governmental Activities Business-type Activities Investment income Proceeds from the sale of water rights Miscellaneous Transfers Total Business-type Activities Total Primary Government Changes in Net Position Governmental Activities Business-type Activities Total Primary Government $ $ $ 2011 2012 2013 2014 55,623,884 $ 53,595,119 $ 55,301,512 $ 58,957,595 $ 63,495,983 10,907,518 9,699,146 12,704,826 14,194,960 15,285,440 179,114 227,446 319,017 439,982 414,689 2,189,906 2,026,285 827,619 493,244 1,455,665 1,183,618 (7,815,285) (3,390,940) (3,892,665) (4,876,544) (5,138,252) 60,921,516 $ 60,958,390 $ 64,925,934 $ 70,171,658 $ 77,431,384 71,819 638,611 3,390,940 $ 4,101,370 $ 92,945 117,103 3,892,665 $ 4,102,713 $ $ 57,527 4,352,000 100,698 7,815,285 12,325,510 $ 73,247,026 $ 65,059,760 $ 69,028,647 $ 75,577,024 $ 82,929,078 $ 4,514,333 7,661,320 12,175,653 $ 3,542,551 $ 6,493,633 (3,862,734) 3,766,033 $ (320,183) $ 10,259,666 $ 10,525,177 4,807,369 $ 15,332,546 $ $ $ $ 95,839 432,983 4,876,544 5,405,366 Note: * Prior to fiscal year 2014 Special Assessments were shown in Public Works-Capital Grants and Contributions Source: Statement of Activities Page 138 $ $ 136,531 222,911 5,138,252 5,497,694 9,804,767 3,536,852 $ 13,341,619 Table 2 Fiscal Year 2015 2016 2017 $ 66,223,459 $ 71,256,446 $ 74,899,373 16,361,588 16,848,837 20,019,457 361,146 710,040 560,547 4,980,000 975,258 393,977 886,502 (582,797) (5,564,606) 2,800,000 $ 88,318,654 $ 83,644,694 $ 99,165,879 $ $ 151,405 103,482 582,797 837,684 $ $ 237,615 22,955 5,564,606 5,825,176 2018 2019 $ 82,662,446 $ 90,314,174 19,967,694 21,244,412 1,196,857 4,661,685 341,814 934,949 3,700,000 3,700,000 (36,893) $ 107,868,811 $ 120,855,220 $ 123,100 $ 47,246 $ 1,595,877 31,081 37,024 40,902 (2,800,000) (3,700,000) (3,700,000) $ (2,645,819) $ (3,615,730) $ (2,063,221) $ 89,156,338 $ 89,469,870 $ 96,520,060 $ 104,253,081 $ 118,791,999 $ 22,556,875 5,403,859 $ 27,960,734 $ 10,174,339 7,973,306 $ 18,147,645 $ 12,604,541 13,710,860 $ 26,315,401 $ 11,756,967 18,577,206 $ 30,334,173 $ 40,353,531 23,442,318 $ 63,795,849 concluded Page 139 Page 140 Table 3 City of Goodyear Governmental Activities Tax Revenues By Source Last Ten Fiscal Years (accrual basis of accounting) (Unaudited) Fiscal Year Property Taxes 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 $ 21,908,223 18,862,731 16,572,825 16,218,397 17,109,458 18,171,606 19,114,087 19,875,628 20,649,103 22,099,698 Sales & Use Taxes $ 31,448,398 32,729,749 36,364,557 40,222,752 43,775,464 45,333,649 49,309,600 52,085,570 58,831,503 64,940,363 Franchise Taxes $ 2,233,908 2,316,821 2,460,521 2,529,456 2,611,061 2,718,204 2,832,759 2,941,175 3,181,840 3,274,113 State Shared Revenues - not Restricted for Specific Programs State Shared State Revenue Highway User Sales Sharing Revenue $ 4,940,934 5,201,106 7,195,568 7,527,259 8,009,713 8,459,645 8,988,686 10,324,010 10,354,186 11,573,618 Source: City Financial Records and Reports Page 141 $ 5,966,584 4,498,039 5,509,258 6,667,701 7,275,727 7,901,942 7,859,101 9,665,448 9,613,508 9,670,794 $ 2,626,096 2,752,001 3,269,285 3,575,158 3,681,156 4,041,402 4,264,827 5,066,574 5,042,068 5,463,045 City of Goodyear Excise Tax Collections Last Ten Fiscal Years (accrual basis of accounting) (Unaudited) Fiscal Year 2010 2011 2012 2013 2014 City Privilege (Sales) Tax State-Shared Sales Tax State-Shared Income Tax State-Share Vehicle License Tax Fines and Forfeitures Franchise Taxes $ 31,448,398 3,391,361 5,966,584 1,549,573 846,143 2,233,909 $ 32,729,749 3,661,678 4,498,039 1,539,429 849,060 2,316,820 $ 36,364,557 5,100,608 5,509,258 2,094,960 825,971 2,460,521 $ 40,222,752 5,342,879 6,667,701 2,184,380 809,334 2,529,456 $ 43,775,464 5,681,717 7,275,727 2,327,996 884,735 2,611,016 Total $ 45,435,968 $ 45,594,775 $ 52,355,875 $ 57,756,502 $ 62,556,655 Source: City Financial Records and Reports Page 142 Table 4 Fiscal Year 2015 2016 2017 2018 2019 $ 45,333,649 5,965,400 7,901,942 2,494,245 860,313 2,718,204 $ 49,309,600 6,258,721 7,859,101 2,729,966 839,108 2,832,759 $ 52,085,570 7,217,395 9,665,448 3,106,615 925,314 2,941,175 $ 58,831,503 7,151,224 9,613,508 3,202,962 1,044,317 3,181,840 $ 64,940,363 8,121,305 9,670,794 3,452,313 1,044,516 3,274,113 $ 65,273,754 $ 69,829,255 $ 75,941,517 $ 83,025,354 $ 90,503,404 Page 143 City of Goodyear Sales & Use Taxes by Industry Classification Last Ten Fiscal Years (Unaudited) Fiscal Year 2010 2011 2012 2013 2014 Mining & Government Construction Manufacturing Utilities Wholesale Trade Retail Trade Restaurant & Bar Real Estate Hotels Services Miscellaneous $ 15,141 5,365,079 535,972 3,085,682 540,630 11,569,427 4,161,539 2,692,806 820,902 1,388,178 640,388 $ 5,234 3,251,977 642,255 3,275,325 598,098 12,950,291 4,415,910 3,510,263 764,996 1,771,527 1,055,398 $ 9,534 4,755,592 701,876 3,469,559 924,842 13,576,350 4,763,951 3,480,031 873,241 1,640,296 1,414,929 $ 970 7,027,296 759,858 3,656,309 977,475 14,265,735 5,079,528 4,405,695 885,571 1,700,258 873,005 $ 4,024 7,988,471 931,362 3,819,536 1,072,608 15,787,043 5,450,424 4,467,373 849,052 1,764,488 968,896 Total* $ 30,815,744 $ 32,241,274 $ 35,610,202 $ 39,631,700 $ 43,103,277 Note: Total may differ from Governmental Activities Tax Revenues By Source because of difference in reporting periods. Source: Arizona Department of Revenue North American Industry Code System (NAICS) Summary Page 144 Table 5 Fiscal Year 2015 $ 2016 2017 2018 2019 7,159 5,559,142 1,318,999 4,051,837 1,130,527 16,348,224 6,343,415 5,480,481 1,067,357 2,424,312 1,032,464 $ 6,534 7,545,663 1,410,894 4,077,652 1,032,679 17,279,498 7,032,111 5,575,550 1,096,710 2,833,590 839,592 $ 1,411 7,276,208 1,430,501 4,088,382 1,071,275 18,204,620 7,551,936 6,043,628 1,054,997 2,900,952 1,256,834 $ 2,064 9,248,956 1,195,577 4,143,475 1,432,261 19,381,848 8,567,822 6,485,025 1,142,972 3,209,135 1,804,279 $ 4,740 13,142,689 1,806,767 4,257,678 1,671,721 21,332,016 8,765,915 7,313,314 1,154,739 3,820,523 1,936,161 $ 44,763,917 $ 48,730,473 $ 50,880,744 $ 56,613,413 $ 65,206,263 Page 145 City of Goodyear Fund Balances of Governmental Funds Last Ten Fiscal Years (modified accrual basis of accounting) (Unaudited) Fiscal Year 2010 General Fund Reserved Unreserved Nonspendable: Advances to other funds Inventories Prepaid items Restricted by: Charter mandates Court Law enforcement Transit Assigned to: IT replacement Fleet replacement Risk management Parks management Police asset reserve Fire asset reserve Traffic signal reserve General Fund FY2020 Budget Unassigned Total General Fund All Other Governmental Funds Reserved, Reported in: Debt Service Funds Capital Projects Funds Community Facilities District Unreserved, Reported in: Special revenue funds Capital projects funds Nonspendable: $ 17,812,619 10,742,777 $ 2012 - $ 2013 - - $ - 961,840 3,627 422,681 961,840 16,258 500,911 961,840 8,916 486,842 961,840 25,261 504,865 - 3,209,321 198,457 129,231 - 3,377,572 261,229 125,812 - 3,528,982 234,813 208,085 543,022 3,676,547 221,290 274,392 644,135 - 407,961 383,225 558,310 21,481,088 437,873 1,730,168 811,244 23,074,844 170,684 3,032,429 357,741 33,325,255 1,484,148 1,502,483 792,947 43,707,677 $ 42,858,609 $ 53,795,585 $ $ 28,555,396 $ 27,755,741 $ 31,297,751 $ 14,891,228 1,393,549 47,213 $ - $ - $ $ 2014 - $ Inventories Prepaid items Restricted by: Debt service Development impact fees Highway user funds Transit Capital projects Community facilities districts operations Committed Unassigned Total All Other Governmental Funds 2011 * - - 20,452,179 - - - - - - 289,782 46,238 412,916 45,225 595,675 36,182 650,344 - - 15,113,512 21,992,019 285,914 536,230 (2,336,765) 15,663,838 21,720,718 400,610 538,410 (9,854) 15,482,259 16,241,644 493,395 1,695,700 711,980 (26,073) 14,848,703 7,892,792 47,570 274,106 803,837 (73,354) 38,771,863 $ 35,230,762 $ 24,443,998 36,784,169 $ 35,926,930 $ Note: *Starting with fiscal year 2011, fund balances were stated in classification required by GASB Statement No. 54 Source: City Financial Records and Reports Page 146 Table 6 Fiscal Year 2015 $ 2016 - $ 2017 - $ 2018 - $ 2019 - $ - 961,840 21,656 573,473 961,840 667,798 1,251,242 683,056 1,045,531 758,946 311,940 1,402,473 3,841,444 240,631 309,112 745,210 4,009,183 178,351 427,243 847,446 4,186,816 200,753 384,144 952,239 4,377,576 238,965 432,662 1,064,752 4,582,213 294,594 470,847 1,189,336 108,301 2,508,319 1,088,234 49,783,760 498,851 3,196,101 1,077,452 1,271,367 52,620,845 1,829,656 1,251,242 933,704 2,729,350 2,147,582 403,209 53,399,369 1,956,201 4,504,416 888,212 3,033,620 134,146 454,872 74,699 60,552,115 1,988,219 3,910,722 805,987 3,280,541 156,142 738,260 1,362,099 55,747,287 16,546,219 $ 60,181,980 $ 65,756,477 $ 70,352,362 $ 79,516,713 $ 92,786,879 $ $ $ $ $ - - - - - - - - - - 487,413 - 564,639 - 533,304 - 553,663 - 678,548 - 13,810,210 9,833,566 174,025 4,414,851 1,109,573 (66,487) 12,989,198 12,882,857 721 1,434,106 (28,737) 13,219,610 12,428,141 37,130 9,869,218 1,846,863 1,647,416 (105,729) 5,576,920 19,453,023 35,863 21,876,083 2,442,864 1,963,850 (22,755) 5,913,772 29,633,601 249 43,953,339 10,164,456 2,555,378 (188,894) $ 29,763,151 $ 27,842,784 $ 39,475,953 $ 51,879,511 $ 92,710,449 Page 147 City of Goodyear Changes in Fund Balances of Governmental Funds Last Ten Fiscal Years (modified accrual basis of accounting) (Unaudited) Fiscal Year Revenues Taxes Licenses and permits Intergovernmental Charges for services Fines and forfeits Investment income Special assessments Contributions Miscellaneous Total Revenues 2010 2011 2012 2013 2014 $ 55,590,530 629,979 16,464,531 7,402,083 846,143 178,715 6,522,924 3,042,851 1,942,018 92,619,774 $ 53,909,300 4,541,951 15,825,858 3,978,325 849,060 225,588 4,859,749 2,707,926 157,090 87,054,847 $ 55,397,903 4,729,946 19,319,623 3,876,918 825,971 319,017 5,844,915 3,099,952 361,202 93,775,447 $ 58,970,605 6,793,070 18,723,318 6,322,025 809,334 439,982 5,845,306 4,024,175 567,839 102,495,654 $ 63,577,425 7,460,830 19,325,653 4,658,927 884,735 414,689 5,839,886 2,408,357 1,327,008 105,897,510 Expenditures * General government Public safety Highways and streets Public works Culture and recreation Development services Capital outlay Debt Service: Principal retirement Interest and debt cost Payment to refunded bond escrow agent Total Expenditures 15,316,159 24,367,955 4,098,986 3,075,759 3,882,621 4,654,052 13,494,149 15,913,718 24,045,015 3,808,328 3,047,742 3,936,203 4,376,985 9,234,659 16,953,769 24,862,833 3,340,208 2,967,386 4,115,701 4,557,391 6,437,600 17,376,427 26,764,289 4,674,325 2,093,312 4,884,349 5,232,999 18,252,039 16,895,276 28,310,822 5,585,966 2,045,578 4,975,947 5,823,318 18,496,444 10,942,758 11,158,130 90,990,569 11,254,524 10,645,162 86,262,336 12,433,024 10,687,152 86,355,064 10,226,228 10,987,906 100,491,874 9,441,923 9,765,514 101,340,788 Excess of Revenues over (under) Expenditures 1,629,205 792,511 7,420,383 2,003,780 4,556,722 Notes: * Beginning in fiscal year 2016 expenditure functions were consolidated to align with the basic financial statements Source: Statement of Revenues, Expenditures and Changes in Fund Balances Page 148 Table 7 Fiscal Year 2015 2016 2017 2018 2019 $ 66,203,440 6,558,607 21,749,386 4,576,618 860,313 361,146 5,762,295 2,976,642 243,473 109,291,920 $ 71,287,200 7,357,205 21,811,572 5,792,947 839,108 710,040 6,096,012 1,346,713 728,930 115,969,727 $ 74,924,078 9,302,729 25,780,719 9,227,037 925,314 560,547 6,009,405 1,638,229 516,160 128,884,218 $ 82,602,447 10,636,668 26,773,324 10,418,539 1,044,317 1,196,857 5,968,798 6,358,002 2,485,672 147,484,624 18,081,622 29,505,746 5,494,087 2,268,109 5,265,454 6,933,854 11,326,103 17,968,635 32,881,648 5,680,917 2,255,101 5,712,191 7,933,367 15,988,901 19,191,902 36,905,961 5,748,952 2,598,519 12,090,866 7,187,389 17,628,611 20,825,896 39,779,006 5,517,174 2,897,716 11,315,720 7,159,767 30,366,883 20,801,270 43,459,464 7,563,123 2,827,607 14,108,472 7,641,804 17,066,876 9,291,703 9,323,202 97,489,880 9,772,183 9,046,458 107,239,401 14,581,544 12,968,581 128,902,325 19,642,573 15,708,001 4,622,056 157,834,792 21,763,951 12,599,646 147,832,213 11,802,040 8,730,326 (18,107) (10,350,168) 15,223,897 $ 90,300,757 12,314,128 27,458,465 12,234,549 1,044,516 4,606,033 9,868,376 4,036,766 1,192,520 163,056,110 continued Page 149 City of Goodyear Changes in Fund Balances of Governmental Funds Last Ten Fiscal Years (modified accrual basis of accounting) (Unaudited) Fiscal Year 2010 Other Financing Sources and (Uses) Transfer in Transfer out Sale of assets* Debt issuance Debt premium Refunding bonds Refunding bonds premium Payment to refunded bond escrow agent 2011 2012 2013 $ 6,376,290 $ 8,388,300 $ 5,504,462 $ 4,726,150 $ 5,356,364 (14,191,575) (10,837,705) (9,397,127) (9,602,694) (10,494,616) 105,000 1,780,000 10,500,000 5,733 129,958 11,530,000 10,685,000 14,755,000 949,267 672,545 1,114,908 . - (11,530,000) (10,965,024) (15,138,166) Total Other Financing Sources and (Uses) (7,704,552) (1,033,440) 6,015,977 Net Change in Fund Balances $ (6,075,347) $ (1,656,894) $ 6,386,943 $ 8,019,757 Debt Service as a Percentage of Noncapital Expenditures 2014 27.0% (2,449,405) 27.3% 28.9% (4,406,510) $ 25.8% Notes: * Beginning in fiscal year 2019 sales of assets was broken out to align with the basic financial statements. Source: City Financial Records and Reports Page 150 150,212 22.3% Table 7 2015 2016 2017 2018 2019 $ 4,588,019 $ 3,539,227 $ 12,768,632 $ 13,901,429 $ 17,954,246 (9,923,248) (9,091,060) (9,968,632) (10,201,429) (14,254,246) 346,124 4,980,000 10,968,000 25,015,000 33,873,000 (39,461) 958,083 7,015,000 18,535,000 118,130,941 51,537,627 452,099 2,047,350 14,546,606 722,171 (7,168,901) (20,106,713) (130,387,703) (49,056,702) - (96,492) (5,076,196) 16,057,844 31,918,096 38,877,207 $ 11,705,548 $ 3,654,130 $ 16,039,737 $ 21,567,928 $ 54,101,104 20.6% 18.4% 24.7% 24.6% 25.2% concluded Page 151 City of Goodyear Property Tax Rates Direct and Overlapping Governments Last Ten Fiscal Years (Unaudited) City Direct Rate Overlapping Rates County-Wide Jurisdictions Fiscal Year 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Debt Operating Service Rate Rate 0.6320 0.9679 0.7603 0.6630 0.9446 0.6554 1.1115 0.6635 1.1994 0.7006 1.1836 0.6864 1.1637 0.7063 1.1598 0.7025 1.1344 0.6005 1.1084 0.6266 Total City Rate 1.5999 1.4233 1.6000 1.7750 1.9000 1.8700 1.8700 1.8623 1.7349 1.7350 County Operating Rate 0.9909 1.0508 1.2407 1.2407 1.2807 1.3209 1.3609 1.4009 1.4009 1.4009 County Library Fire District District Assistance Rate Rate 0.0353 0.0057 0.0412 0.0066 0.0492 0.0084 0.0492 0.0110 0.0438 0.0121 0.0556 0.0113 0.0556 0.0116 0.0556 0.0112 0.0556 0.0102 0.0556 0.0107 Source: Maricopa County Assessor's Office County County Flood Education District Equalization Rate Rate 0.1367 0.3306 0.1489 0.3564 0.1780 0.4259 0.1780 0.4717 0.1392 0.5123 0.1392 0.5089 0.1592 0.5054 0.1792 0.5010 0.1792 0.4875 0.1792 0.4741 continued Page 152 Table 8 Overlapping Rates County-Wide Jurisdictions Fiscal Year 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Community College Rate 0.8844 0.9728 1.2082 1.3778 1.5340 1.5187 1.4940 1.4651 1.4096 1.1708 Central Arizona Project Rate 0.1000 0.1000 0.1000 0.1000 0.1400 0.1400 0.1400 0.1400 0.1400 0.1400 Special Health Care District Rate 0.0914 0.1122 0.1494 0.3053 0.2941 0.2941 School Districts Total Agua Fria/ County Avondale Litchfield Rate Rate Rate 2.5750 6.0066 5.3164 2.7889 5.3923 5.3658 3.3598 7.4753 3.2590 3.4284 7.4945 3.8863 3.6621 8.2090 3.9772 3.6946 10.0022 3.7780 3.7267 9.4960 3.8352 4.0583 9.8771 3.8142 3.9771 8.9315 3.4763 3.7254 8.4894 3.8499 Buckeye/ Tolleson/ Liberty Littleton Rate Rate 5.2568 5.8681 6.1069 6.1935 6.2698 7.8626 6.9607 9.2259 7.1092 11.4641 8.0102 10.4333 7.6149 9.9303 7.0163 9.5342 7.0616 9.8185 6.8080 10.0261 Mobile Rate 6.2147 5.4994 4.9490 6.9350 7.7572 7.8876 7.8876 8.1213 7.8876 7.8876 continued Page 153 City of Goodyear Property Tax Rates Direct and Overlapping Governments Last Ten Fiscal Years (Unaudited) Overlapping Rates Other Special Taxing Districts Fiscal Year 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 West Maricopa Education Center District Rate 0.0500 0.5000 0.0500 0.0500 0.0592 0.0810 0.0698 0.0840 0.1780 0.1494 Central Arizona GRD Rate 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 Estrella Centerra Cortina Cottonflower Mtn. Ranch Roosevelt Community Community Community Community Irrigation Facilities Facilities Facilities Facilities District District District District District Rate Rate Rate Rate Rate 17.1000 2.6829 1.2146 2.1198 1.3000 17.1000 2.3797 2.2087 2.9776 1.3000 17.1000 2.1961 2.7298 3.4033 1.3000 17.1000 3.2961 2.8500 3.8528 1.3000 17.1000 3.3559 2.8500 3.9890 1.3000 27.1000 3.0361 2.6034 3.2768 1.3000 27.1000 3.1327 2.5999 3.3377 1.3000 27.1000 2.7404 2.3824 3.0482 1.3000 27.1000 2.6706 1.8877 2.5714 1.3000 29.8100 2.5823 1.8664 2.5413 1.3000 continued Page 154 Table 8 Overlapping Rates Fiscal Year 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Other Special Taxing Districts Goodyear Goodyear Palm King Wildflower Wildflower Community Community Valley Ranch Community Community Facilities Facilities Community Community Facilities Facilities General Utilities Facilities Facilities General General District #1 District #1 District #3 District District #1 District #2 Rate Rate Rate Rate Rate Rate 0.6629 1.0000 0.2165 0.3000 1.5905 1.6561 0.7570 1.0000 1.2952 0.3000 2.2891 2.5496 0.8034 1.0000 1.2684 0.3000 2.8718 2.9933 1.0000 1.0000 1.8035 0.3000 3.3150 3.3467 1.0000 1.0000 1.7844 0.3000 3.4365 3.8922 0.7334 1.0162 1.2592 0.3000 2.7761 3.0227 0.7075 1.1497 1.1097 0.3000 2.9103 3.1070 0.8466 1.1500 0.9308 0.3000 2.7230 2.9330 0.9600 1.1500 0.8682 0.3000 2.8882 3.0463 0.8896 1.1480 0.8085 0.3000 2.8489 2.7801 concluded Page 155 Page 156 Table 9 City of Goodyear Principal Property Tax Payers Current Fiscal Year and Nine Years Prior (Unaudited) Fiscal Year 2010 2019 Rank Percentage of Total Taxable Assessed Value 21,998,911 1 2.20% VHS of South Phoenix, Inc. 14,589,354 2 Macys Corporate Services Inc 8,463,230 4 Taxable Assessed Value Taxpayer Arizona Public Service Company $ Taxable Assessed Value 24,089,203 1 2.62% 1.46% 19,039,394 2 2.07% 0.85% 9,617,490 3 1.05% GSLP Goodyear LLC 8,154,378 4 0.89% HUHTAMAKI Inc 8,044,869 5 0.87% FR PV 303 LLC 8,176,762 6 0.89% HGREIT II Goodyear Crossing LLC 7,814,745 7 0.85% NP Goodyear AZ Industrial LLC 7,572,834 8 0.82% HCL Goodyear Centerpointe LLC (Lease) 6,217,428 9 0.68% Southwest Gas Corporation (T&D) 5,511,428 10 0.60% NNP III EMR 3 LLC 14,447,700 3 1.44% HE Capital KR LLC 8,362,053 5 0.84% First American Title Ins Co TR 7854 8,342,423 6 0.83% DH Goodyear LLC 7,254,270 7 0.72% The Market at Estrella Falls LLC 7,198,390 8 0.72% Vestar Arizona XL III LLC 6,619,055 9 0.66% Meritage Homes of Arizona Inc 6,143,253 10 0.61% Total $ 103,418,639 Source: Maricopa County Treasurer Page 157 10.52% $ Rank Percentage of Total Taxable Assessed Value $ 104,238,531 11.33% City of Goodyear Assessed Value and Estimated Actual Value of Taxable Property Last Ten Fiscal Years (Unaudited) Total Assessed Value Residential Property Fiscal Year Ended June 30 $ 482,286,104 497,383,109 Total Assessed Value Commercial Property $ 233,187,882 284,491,038 Agricultural/ Vacant Land $ 248,660,120 374,640,069 Less: Tax-Exempt Property Other $ 63,427 28,842 $ 113,281,184 173,686,635 Net Assessed Value 2010 Primary Secondary 2011 Primary Secondary 404,164,550 405,850,285 265,580,527 297,842,341 246,048,945 308,078,489 70,064 33,349 126,711,288 163,045,578 789,152,798 848,758,886 2012 Primary Secondary 357,230,458 357,367,570 238,218,141 252,752,614 194,223,071 206,673,571 226,506 214,401 122,548,914 144,006,328 667,349,262 673,001,828 2013 Primary Secondary 338,747,451 339,165,652 220,657,668 228,812,312 163,082,414 167,084,029 240,243 244,254 120,560,037 129,664,064 602,167,739 605,642,183 2014 Primary Secondary 340,280,668 342,294,870 205,111,305 211,390,271 161,905,429 165,979,539 273,421 275,521 122,898,455 129,681,549 584,672,368 590,258,652 2015 Primary Secondary 393,827,703 416,834,896 192,119,198 196,638,563 158,537,781 169,043,455 1,158,177 1,167,249 115,918,333 122,400,093 629,724,526 661,284,070 2016 Limited Property Value 427,218,918 223,077,763 149,242,505 1,127,677 129,713,965 670,952,898 2017 Limited Property Value 457,689,029 227,887,800 146,856,414 6,601,784 128,500,705 710,534,322 2018 Limited Property Value 499,088,340 234,739,156 159,566,464 6,975,609 137,331,297 763,038,272 2019 Limited Property Value 538,457,161 256,367,234 152,787,152 7,383,730 132,980,202 822,015,075 Notes: Beginning in fiscal year 2016, the Net Assessed Limited Property Value is statutorily required to be used for the calculation of primary and secondary property taxes. Prior to fiscal year 2016, the primary levy was calculated using the limited assessed valuation and the secondary levy was calculated using the full cash assessed valuation. Detail data prior to 2009 for "primary" is not available. Source: Maricopa County Assessor's Office Page 158 $ 850,916,349 982,856,423 Table 10 Estimated Actual Taxable Value Total Direct Tax Rate 0.6320 0.9679 $ Assessed Value as Percentage of Actual Value 7,439,067,045 8,607,745,155 11.4% 11.4% 0.7603 0.6630 6,843,890,271 7,401,814,203 11.5% 11.5% 0.9446 0.6554 5,978,258,706 6,130,095,795 11.2% 11.0% 1.1115 0.6635 5,513,086,956 5,583,052,641 10.9% 10.8% 1.1994 0.7006 5,485,036,603 5,562,951,789 10.7% 10.6% 1.1836 0.6864 6,012,798,998 6,332,435,414 10.5% 10.4% 1.8700 6,479,932,484 10.4% 1.8623 6,951,354,974 10.2% 1.7349 7,490,466,600 10.2% 1.7350 7,985,016,888 10.3% Page 159 Table 11 City of Goodyear Property Tax Levies and Collections Last Ten Fiscal Years (Unaudited) Fiscal Year Taxes Levied Ended for the June 30 Fiscal Year (a) Collected within the Fiscal Year of the Levy Collection in Percentage Subsequent Amount of Levy Years 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 $ 14,328,617 11,291,963 10,454,308 10,523,654 10,949,615 11,808,563 12,392,149 13,024,932 13,071,185 14,097,133 $ 14,959,898 11,650,452 10,743,752 10,714,099 11,185,149 11,992,446 12,599,829 13,157,209 13,232,702 14,263,392 95.78% 96.92% 97.31% 98.22% 97.89% 98.47% 98.35% 98.99% 98.78% 98.83% $ Total Collections to Date Percentage Amount of Levy 317,754 $ 14,646,371 24,739 11,316,702 101,729 10,556,037 47,705 10,571,359 51,739 11,001,355 113,307 11,921,870 (0) 12,392,149 (53,465) 12,971,467 13,071,185 14,097,133 97.90% 97.14% 98.25% 98.67% 98.36% 99.41% 98.35% 98.59% 98.78% 98.83% (a) Tax levy is reported by the Treasurer as of August of each fiscal year. Amount does not include adjustments made to levy amounts after the August report. Source: Maricopa County Treasurer's Office Page 160 Table 12 City of Goodyear Utility Statistical Data Ten Largest Water Users Current Fiscal Year and Nine Fiscal Years Ago (Unaudited) Fiscal Year Entity Snyders JB Park Shadows Huhtamaki Inc Cancer Treatment Center of America 3 Minute Car Wash Shepard Investment Poore Brothers, Inc. Target Walmart McLane Sunwest Canyon Trails Unit HOA 3A Canyon Trails HOA Canyon Trails Unit HOA 4A Canyon Trails 4 - South Centerra, LLC Agua Fria Union High School Dist. Avondale School Sarival Paseo Joint Community Cottonflower Goodyear Community 2010 2019 Fees & Fees & Type of User Rank Charges Rank Charges Industry $ 1 $ 396,275 Apartments 10 $ 67,355 2 $ 298,246 Industry $ 3 $ 233,493 Multi Purpose $ 4 $ 231,727 Car Wash $ 5 $ 211,876 Apartments $ 6 $ 184,607 Food Manufacturer, Snacks $ 7 $ 147,934 Industry $ 8 $ 102,582 Commercial $ 9 $ 95,283 Industry $ 10 $ 69,557 Homeowner's Association 1 $ 197,098 $ Homeowner's Association 2 $ 189,539 $ Homeowner's Association 3 $ 164,577 $ Homeowner's Association 4 $ 139,712 $ Homeowner's Association 5 $ 121,117 $ School 6 $ 104,297 $ School 7 $ 102,992 $ Homeowner's Association 8 $ 99,371 $ Homeowner's Association 9 $ 74,265 $ - Total Total as a percent of total Water System Operating Revenue Source: City customer service and billing records Page 161 $ 1,260,323 $ 1,971,579 14.10% 13.64% Page 162 Table 13 City of Goodyear Utility Statistical Data Ten Largest Wastewater Users Current Fiscal Year and Nine Fiscal Years ago (Unaudited) Fiscal Year Entity Arizona State Prison/Perryville Huhtamaki Cancer Treatment Center Poore Brothers, Inc. Shepard Inv Apartments Park Shadows Snyders's of Hanover 3 Minute Car Wash Agua Fria Union High School District NNP III Estrella Mtn Ranch LLC McLane Sunwest Fairfield Centerra LLC Airport Training Center Avondale Elementary Alliance Residential Americas Best Value Inn 2010 2019 Fees & Fees & Type of User Rank Charges Rank Charges Prison 1 $ 310,582 1 $ 1,319,752 Manufacturer 2 $ 111,999 Hospital 3 $ 102,046 Food Manufacturer, Snacks 5 $ 29,681 4 $ 83,099 Apartments 5 $ 74,610 Apartments 2 $ 50,718 6 $ 64,323 Food Manufacturer, Snacks 7 $ 52,779 Car Wash 8 $ 51,310 Education 7 $ 25,516 9 $ 36,847 Land Development 10 $ 36,199 Grocery Distributor 8 $ 22,180 Real Estate 3 $ 37,170 Airport 4 $ 31,970 Education 6 $ 28,237 Real Estate 9 $ 20,015 Hotel 10 $ 19,547 Total $ Total as a percent of total Wastewater System Operating Revenue Source: City customer service and billing records Page 163 575,616 $ 1,932,964 9.01% 18.27% City of Goodyear Schedule of Existing and Adopted Monthly Water & Wastewater Service Charges (2012 - 2019) (Unaudited) Description of Water System Services Adopted Adopted Adopted Adopted Adopted Adopted Adopted 2012 2013 2015 2016 2017 2018 2019 $ 17.49 Existing Fees Base Charge (Meter Size) 12.70 $ 10.05 $ 10.23 $ 11.24 $ 12.70 $ 14.73 $ 16.35 1 Inch 3/4 Inch $ 17.56 12.74 14.14 15.54 17.56 20.37 22.61 24.19 1 1/2 Inch 28.39 19.74 22.86 25.12 28.39 32.93 36.55 39.11 2 Inches 45.96 32.02 37.01 40.67 45.96 53.31 59.17 63.31 3 Inches 77.67 61.64 70.67 77.67 77.67 77.67 77.67 77.67 4 Inches 126.65 99.58 115.24 126.65 126.65 126.65 126.65 126.65 6 Inches 240.36 189.08 218.71 240.36 240.36 240.36 240.36 240.36 Monthly Volume Charge - Residential 0 - 6,000 gallons (per thousand) $ 6,001 - 12,000 (per thousand) 1.47 (2) $ 1.46 2.93 (3) $ 2.92 1.18 $ 2.36 1.30 $ 2.59 1.47 $ 2.93 1.71 $ 3.40 1.90 $ 3.77 2.03 4.03 12,001 - 30,000 (per thousand) 4.40 (4) 4.38 3.54 3.89 4.40 5.10 5.66 6.06 30,001+ gallons (per thousand) 7.06 (5) 5.69 5.69 6.25 7.06 8.19 9.09 9.73 Monthly Volume Charge - Commercial 0 - 40,000 gallons (per thousand) $ 3.73 $ 2.60 $ 3.00 $ 3.30 $ 3.73 $ 4.29 $ 4.72 $ 4.91 40,001 - 100,000 gallons (per thousand) 5.97 4.16 4.80 5.28 5.97 6.87 7.56 7.86 100,001+ gallons (per thousand) 7.75 5.41 6.24 6.86 7.75 8.97 9.80 10.19 Note: Rates shown are for customers within city limits. The rates for customers outside of the city limits are 25% greater than the customers within city limits. Rate increases are adopted at the direction of City Council. (1) Rates were updated during January 2017 (2) Monthly volume change for fees is 0 - 6,000 gallons (per thousand). (3) Monthly volume change for fees is 6,001 - 12,000 gallons (per thousand). (4) Monthly volume change for fees is 12,001 - 30,000 gallons (per thousand). (5) Monthly volume change for fees is 30,001 - and over gallons (per thousand). Schedule of Water System Rate Increases (2011-2019) Rate Date Increase Fiscal Year 2011 7.5% Fiscal Year 2012 9.4% Fiscal Year 2013 Fiscal Year 2014 0.0% N/A Fiscal Year 2015 10.0% Fiscal Year 2016 13.0% Fiscal Year 2017 16.0% Fiscal Year 2018 11.0% Fiscal Year 2019 7.0% Source: City Financial Records, Reports and Water & Wastewater Rate Study. The table above reflects only certain fees and charges of the City's water system and is not a comprehensive statement of all such fees. Page 164 Table 14 Description of Wastewater System Services Existing Fees Adopted Adopted Adopted Adopted Adopted Adopted 2012 2013 2016 2017 2018 2019 Residential Wastewater Service Base Charge (See below) Volume Charge (per 1,000 gallons) $ 5.95 $ 4.90 $ 5.78 $ 5.95 $ 6.13 $ 6.25 $ 6.38 General Commercial Wastewater Service Base Charge (See below) Volume Charge (per 1,000 gallons) $ 5.95 $ 4.90 $ 5.78 $ 5.95 $ 6.13 $ 6.25 $ 6.38 $ 21.75 $ 18.96 $ 21.12 $ 21.75 $ 22.40 $ 22.85 $ 23.31 Base Charge (Meter Size) 3/4 Inch 1 Inch 33.38 28.02 32.41 33.38 34.38 35.07 35.77 1 1/2 Inch 41.14 34.61 39.94 41.14 42.37 43.22 44.08 2 Inches 79.91 67.16 77.58 79.91 82.31 83.96 85.64 3 Inches 115.22 99.68 115.22 115.22 115.22 115.22 115.22 4 Inches 152.86 139.10 152.86 152.86 152.86 152.86 152.86 6 Inches 378.70 328.83 378.70 378.70 378.70 378.70 378.70 Schedule of Wastewater System Rate Increases (2011-2019) Rate Date Increase Fiscal Year 2011 9.30% Fiscal Year 2012 9.50% Fiscal Year 2013 15.20% Fiscal Year 2014 N/A Fiscal Year 2015 N/A Fiscal Year 2016 3.00% Fiscal Year 2017 3.00% Fiscal Year 2018 2.00% Fiscal Year 2019 2.00% Page 165 City of Goodyear Ratios of Outstanding Debt by Type Last Ten Fiscal Years (Unaudited) Fiscal Year Ended June 30 General Obligation Bonds 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 $ 33,601,981 31,358,457 29,000,636 26,555,569 24,616,149 21,638,323 18,564,501 21,987,761 43,983,309 64,022,774 Governmental Activities Public Improvement McDowell Corporation Road Municipal Corridor Contract Facilities Improvement Payable Revenue Bond District $ 5,755,628 3,755,628 1,755,628 - $ 5,230,000 4,510,000 2,940,000 12,431,467 11,047,495 10,037,745 8,859,189 127,152,711 121,145,790 100,376,526 $ 46,060,000 44,900,000 43,675,000 42,390,000 42,383,378 40,881,328 39,304,278 37,647,228 34,870,000 28,910,000 Community Facilities District Bonds $ 122,313,000 117,182,000 113,555,000 109,823,000 107,194,657 108,520,857 106,289,435 103,870,391 94,683,268 87,776,000 Source: US Census Bureau, Applied Geographic Solutions/TIGER Geography, and City Financial Records Page 166 Table 15 General Obligation Bonds $ 92,753,019 91,121,543 89,394,364 85,384,431 82,113,973 77,607,211 73,018,360 66,702,679 58,226,165 48,957,226 Business-Type Activities Public Improvement Corporation Municipal Facilities Revenue Revenue Bond Bonds $ 102,300,000 102,300,000 102,180,000 102,180,000 104,096,689 103,970,274 104,164,132 - $ 17,040,000 32,245,000 31,985,000 31,390,000 30,596,520 30,114,933 42,413,304 41,924,131 40,489,966 37,175,000 Water Infrastructure Finance Authority Loan $ 9,925,289 12,554,096 11,908,603 10,998,942 10,064,007 9,096,237 3,854,322 3,591,773 3,323,972 3,050,815 Water Rights $ 10,314,041 - Page 167 Total $ 445,292,958 439,926,724 426,394,231 421,153,409 412,112,868 401,866,908 396,467,521 402,876,674 396,722,470 370,268,341 Percentage of Personal Income Per Capita 25.14% 24.49% 20.10% 22.13% 20.81% 21.38% 19.80% 21.52% 16.23% 14.16% 7,119 6,740 6,430 6,264 5,773 5,443 5,304 5,180 4,750 4,374 Table 16 City of Goodyear Ratios of General Bonded Debt Outstanding Last Ten Fiscal Years (Unaudited) Fiscal Year Ended June 30 General Obligation Bonds 2010 2011 2012 2013 2014 2015 2016 $126,355,000 122,480,000 118,395,000 111,940,000 106,730,122 99,245,534 91,582,861 2017 2018 2019 88,690,440 102,209,474 112,980,000 Less: Amounts Available in Debt Service Fund $ 828,016 668,186 1,246,110 841,716 98,876 13,202 703,557 778,715 229,724 Percentage Estimated Actual Taxable Value of Property Total $ Per Capita 125,526,984 121,811,814 117,148,890 111,098,284 106,631,246 99,245,534 91,569,659 12.77% 14.35% 17.41% 18.34% 18.07% 15.01% 13.65% 2,007 1,866 1,767 1,652 1,494 1,344 1,225 87,986,883 101,430,759 112,750,276 12.38% 13.29% 13.72% 1,131 1,215 1,332 Source: City Financial Records and Reports Page 168 Table 17 City of Goodyear Direct and Overlapping Governmental Activities Debt As of June 30, 2019 (Unaudited) Net Assessed Limited Property Value Overlapping Jurisdiction Debt Outstanding Net Debt Amount Maricopa County Maricopa County Community College District Maricopa Special Healthcare District Western Maricopa Education Center Liberty Elementary School District No. 25 Avondale Elementary School District No. 44 Littleton Elementary School District No. 65 Litchfield Elementary School District No. 79 Mobile Elementary School District No. 86 Buckeye Union High School District No. 201 Tolleson Union High School District No. 214 Agua Fria Union High School District No. 216 Wildflower Ranch Community Facilities District No. 1 Wildflower Ranch Community Facilities District No. 2 Community Facilities General District No. 1 Community Facilities Utility District No. 1 Estrella Mountain Ranch Community Facilities District Cottonflower Community Facilities District Centerra Community Facilities District Cortina Community Facilities District Palm Valley Community Facilities District Subtotal of overlapping debt: $ 40,423,232,421 40,423,232,421 40,489,188,615 14,779,081,648 242,901,538 367,311,044 249,928,457 819,761,974 8,470,387 707,975,119 1,134,931,491 1,187,073,018 5,076,618 5,019,870 121,618,437 340,810,785 92,235,004 9,587,986 11,956,990 10,463,228 78,569,486 $ 141,508,426,537 445,570,000 534,125,000 138,655,000 17,970,000 36,470,000 27,280,000 54,870,000 80,680,000 139,170,000 100,305,000 470,000 705,000 8,355,000 32,520,000 12,615,000 1,865,000 3,082,000 1,860,000 5,650,000 $ 1,642,217,000 2.03 % $ 2.03 9,060,761 2.03 10,843,853 5.56 7,712,015 58.79 10,564,475 83.28 30,373,530 0.03 7,157 44.76 24,561,285 44.02 19.89 16,043,959 0.01 7,989 56.76 56,928,832 100.00 470,000 100.00 705,000 100.00 8,355,000 100.00 32,520,000 100.00 12,615,000 100.00 1,865,000 100.00 3,082,000 100.00 1,860,000 100.00 5,650,000 $ 233,225,856 Direct Debt: City of Goodyear $ $ 100.00 % $ 297,480,059 822,015,075 $ Estimated Percentage Applicable (a) 297,480,059 Total Direct and Overlapping Debt $ 530,705,915 Total Governmental and Business-Type General Obligation Bonds $ 112,980,000 100.00 % $ 112,980,000 (a) Proportion applicable to the City of Goodyear, Arizona is computed on the ratio of net assessed limited property value for 2018/19 Sources: Maricopa County Assessor's Office and Official Statements Note: Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the city. This schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents and businesses of the City of Goodyear. This process recognizes that when considering the government's ability to issue and repay long-term debt, the entire debt burden borne by the residents and businesses should be taken into account. However, this does not imply that every taxpayer is a resident, and therefore responsible for repaying the debt, of each overlapping government The percentage of overlapping debt applicable is estimated using taxable assessed property values. Applicable percentages were estimated by determining the portion of the county's taxable assessed value that is within the government's boundaries and dividing it by the county's total taxable assessed value. Page 169 City of Goodyear Legal Debt Margin Information As of June 30, 2019 (Unaudited) Fiscal Year 2010 2011 2012 $ 982,856,423 $ 848,758,886 $ 673,001,828 20% Limitation Debt Limit Equal to 20% of Assessed Valuation 196,571,285 169,751,777 134,600,366 121,128,437 118,051,730 Total Debt Applicable to 20% Limit 126,070,000 122,205,000 118,130,000 111,690,000 104,775,000 Legal 20% Debt Margin (Available Borrowing Capacity) $ 70,501,285 $ 47,546,777 $ 16,470,366 Total net debt applicable to the limit as a percentage of debt limit 64.13% 71.99% 87.76% 6% Limitation Debt Limit Equal to 6% of Assessed Valuation $ 58,971,385 $ 50,925,533 $ 40,380,110 Total Debt Applicable to 6% Limit 285,000 275,000 265,000 Legal 6% Debt Margin (Available Borrowing Capacity) $ 58,686,385 $ 50,650,533 $ 40,115,110 0.48% 0.54% 0.66% Net Full Cash Assessed Value Total net debt applicable to the limit as a percentage of debt limit Source: Maricopa County Treasurer's Office and City financial records and reports Page 170 2013 $ $ 605,642,183 9,438,437 2014 $ $ 92.21% $ 36,338,531 36,088,531 0.69% 13,276,730 88.75% $ 35,415,519 250,000 250,000 $ 590,258,652 $ 35,165,519 0.71% Table 18 Fiscal Year 2015 2016 2017 $ 659,588,897 $ 670,952,898 $ 871,205,504 131,917,779 134,190,580 97,570,000 2018 $ 2019 964,201,508 $ 1,043,418,163 174,241,101 192,840,302 208,683,633 90,065,000 106,130,000 97,065,000 112,980,000 $ 34,347,779 $ 44,125,580 $ 68,111,101 73.96% 67.12% 60.91% $ 39,575,334 $ 40,257,174 $ 52,272,330 220,000 205,000 190,000 $ 39,355,334 $ 40,052,174 $ 52,082,330 0.56% 0.51% 0.36% $ 95,775,302 $ 95,703,633 50.33% $ 57,852,090 54.14% $ 62,605,090 - $ 57,852,090 - $ 62,605,090 0.00% Page 171 0.00% Table 19 City of Goodyear Pledged-Revenue Coverage As of June 30, 2019 (Unaudited) Public Improvement Corporation Municipal Facilities Revenue Bonds Fiscal Year Ended June 30 Operating Revenue Pledged Revenue 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 57,363,961 57,697,609 65,501,422 76,004,072 81,109,035 82,672,164 87,880,128 95,623,345 107,069,770 116,486,271 45,979,781 45,808,725 52,566,675 57,969,777 62,768,755 65,489,144 70,078,679 75,361,987 83,228,379 90,707,954 Debt Service Principal Interest 720,000 745,000 570,000 590,000 85,000 230,000 235,000 3,220,000 3,500,000 5,840,000 Coverage 5,594,412 5,562,612 4,925,626 5,505,685 5,702,661 5,458,563 5,451,663 3,674,649 4,710,941 4,563,216 7.28 7.26 9.57 9.51 10.85 11.51 12.32 10.93 10.14 8.72 Debt Service Principal Interest 1,195,691 543,662 1,167,815 1,802,534 1,139,026 5,554,656 1,504,661 5,819,924 1,439,935 2,212,948 1,467,770 2,207,414 1,496,834 2,159,000 1,682,550 2,268,124 1,742,801 2,292,417 1,613,157 2,014,361 Coverage 4.62 3.13 1.72 1.68 3.37 3.09 3.49 3.27 5.37 6.36 Water & Sewer Bonds & Loans Fiscal Year Ended June 30 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Operating Revenue 16,378,677 18,271,778 20,221,750 23,133,152 24,989,997 24,748,802 27,964,881 31,380,884 35,230,057 42,658,585 Less: Operating Expenses 8,350,588 8,965,363 8,703,445 10,837,296 12,684,374 13,405,653 15,205,094 18,471,783 13,551,129 19,584,574 Net Operating Revenue 8,028,089 9,306,415 11,518,305 12,295,856 12,305,623 11,343,149 12,759,787 12,909,101 21,678,928 23,074,011 Source: City Financial Records and Reports Page 172 Table 20 City of Goodyear Demographic and Economic Statistics Last Ten Fiscal Years (Unaudited) Fiscal Year Population 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 65,275 66,309 67,239 71,381 73,832 74,743 77,776 78,189 83,512 84,659 Personal Income (in thousands) $ 1,796,433 2,120,960 1,903,133 1,980,537 1,879,673 2,001,907 1,871,990 2,157,938 2,443,812 2,615,370 Per Capita Personal Income $ 27,521 31,986 28,304 27,746 25,459 26,784 24,069 27,599 29,263 30,893 Median Age 35.5 33.5 35.2 38.4 36.5 35.6 36.7 36.7 37.1 37.1 Source: Bureau of Labor Statistics and City Financial Records Page 173 Education Level in Years of Schooling Unemployment Rate 13 to 16 13 to 16 13 to 16 13 to 16 13 to 16 13 to 16 13 to 16 13 to 16 13 to 16 13 to 16 7.1% 9.8% 8.2% 8.3% 7.2% 5.7% 5.5% 4.4% 4.2% 4.8% Table 21 City of Goodyear Principal Employers Current Fiscal Year and Nine Fiscal Years Prior (Unaudited) Major Corporation Fiscal Year 2010 Percentage of Total City Employees Rank Employment* Fiscal Year 2019 Percentage of Total City Employees Rank Employment* Amazon.com 600 5 2.04% 1,175 1 2.86% (Abrazo Healthcare) West Valley Hospital 444 8 1.51% 1,009 2 2.46% 1,008 3 2.46% Macy's Inc Arizona State Prison/Perryville 825 1 2.80% 930 4 2.27% Cancer Treatment Center's of America 279 10 0.95% 768 5 1.87% 700 6 1.71% 644 7 1.57% 590 8 1.44% 345 9 0.84% 325 10 0.79% Chewy.com City of Goodyear 703 3 2.39% Subzero Freezer Co McLane Sunwest 510 6 1.73% Cavco Metokote Corporation 750 2 2.55% Lockheed Martin 700 4 2.38% Americus Logistics, LLC 500 7 1.70% Walmart Supercenter 370 9 1.26% Total 5,681 19.29% Source: City Records *2019 labor force = 41,033 ; 2010 labor force = 29,450 Page 174 7,494 18.26% Table 22 City of Goodyear Full-time Equivalent City Government Employees by Function Last Ten Fiscal Years (Unaudited) 2010 General Government Financial Services Information Services Police Officers Civilians Planning and Development Fire Firefighters and Officers Civilians Human Resources Community Services Economic Development Municipal Services Public Works Water Wastewater Sanitation Total 2011 2012 2013 Fiscal Year 2014 2015 2016 2017 2018 2019 53 30 13 52 30 13 52 28 14 55 29 14 55 27 15 69 28 18 55 29 18 62 31 18 50 31 19 83 31 23 97 29 10 94 29 9 94 27 9 94 30 25 91 29 23 93 30 21 96 35 50 103 38 50 108 42 49 111 43 46 90 22 8 0 7 10 79 23 18 9 87 24 7 0 7 8 78 22 17 9 91 20 9 0 6 13 65 21 18 7 90 7 10 0 4 13 73 23 17 5 91 8 10 0 4 10 75 24 20 5 90 12 10 0 5 13 87 26 19 6 92 10 10 0 6 13 63 27 19 8 92 10 11 0 6 13 63 27 17 7 92 17 10 0 6 14 81 28 18 7 106 18.5 11 0 6 15.3 93.2 29 19 9 498 486 474 489 487 527 531 548 572 644 Source: City Financial Records and Reports Page 175 City of Goodyear Operating Indicators by Function Last Ten Fiscal Years (Unaudited) Function 2010 General Government City Clerk's Office # of records requests City Prosecutor's Office Charges filed/charges adjudicated (resolved) City Manager's Office % of survey respondents rating "Your Neighborhood as a Place to Live" as good to excellent Digital Communications News releases/media updates Growth of Digital assets (Facebook, Twitter, Instagram, & Linkedin combined Total newsletter pages sent to citizens Number of visits to website Number of web pages viewed Number of graphics/photography projects completed 2011 2012 2013 2014 504 550 484 470 504 3,395 3,380 3,827 2,514 3,170 90% 90% 94% 94% 95% 235 150 49 59 76 176 715,285 2,208,180 217 144 703,174 2,104,553 230 136 771,938 2,203,995 262 112 804,542 2,185,489 254 114 491,540 1,850,471 275 Police # of total arrests # of moving violations citations 4,731 11,810 2,254 12,581 2,402 11,468 2,532 10,259 2,612 10,586 Fire # of emergency responses # of fires extinguished # of inspections 5,570 226 4,262 6,597 235 3,229 7,195 271 212 5,604 243 969 8,298 242 752 8,024 1,147 168,647 6,413 1,344 170,657 6,132 1,229 178,466 6,298 1,238 184,638 6,403 1,091 191,189 <3 4,232 <3 3,269 <1 3,576 <1 3,529 <1 3,580 100% 100% 100% 100% 100% 70% 100% 100% 100% 100% 247 4.18% 125 4.11% 118 4.86% 178 5.01% 180 4.85% 52,241 22,175,027 54,428 22,696,736 63,256 23,151,438 69,596 23,151,438 74,527 23,151,438 -10.40% -3.90% 4.42% -7.31% 10.45% 14.15% 11.29% 1.41% 8.76% -4.12% Financial Services # accounts payable checks issued # purchase orders # water meters read annually Planning and Development Customer wait-time (in minutes) at One Stop Shop Total number of permits issued Provide applicant with pre-application meeting within 30 days of submitting request % % of inspections performed within 24 hours of request Human Resources # of new hires (FT & PT) (1) HR budgeted operating cost as a % of City budgeted payroll Parks and Recreation # attending Park & Recreation facilities and Libraries annually (2) # of square feet of medians and rights of way maintained Economic Vitality Sales Tax growth (% annual change) Bed Tax growth (% annual change) Page 176 Table 23 2015 2016 2017 2018 2019 598 629 770 904 767 3,623 3,608 4,261 4,031 3,656 95% 93% 93% 91% 95% 88 126 136 633,643 1,855,914 135 144 543,565 1,472,765 103 128 302,777 1,500,539 157 132 9,650 232 588,580 1,271,883 318 NA 14,380 192 1,407,259 1,123,076 143 2,846 5,919 2,661 3,479 3,296 4,382 2,808 2,281 1,585 2,327 6,972 205 1,539 6,002 165 1,253 7,498 214 2,050 9,115 252 853 9,583 204 909 6,254 1,009 196,863 5,914 1,442 201,704 5,772 1,512 208,083 5,254 1,166 217,700 4,941 1,309 226,869 <1 2,868 NA 5,610 NA 5,732 NA 5,228 NA 5,137 100% 96% 100% 100% 100% 100% 100% 100% 100% 100% 144 5.05% 362 5.06% 204 6.00% 220 3.12% 234 2.23% 74,527 23,151,438 188,000 23,151,438 249,000 23,151,438 275,000 23,151,438 299,000 23,151,438 3.85% 25.71% 8.86% 2.75% 4.04% -3.80% 11.66% 14.37% 13.50% 9.60% NA Page 177 City of Goodyear Operating Indicators by Function Last Ten Fiscal Years (Unaudited) Function Municipal Services # of homes serviced by Residential Refuse Collection # of citizens serviced by Household Hazardous Waste collection program 2010 2011 2012 2013 2014 20,928 21,489 22,363 23,387 24,346 848 729 503 546 550 Water Service # of residential customers # of multifamily customers # of commercial customers Water Service Connections Water production daily peak demand (million gallons per day) Reclaimed Water Supplied (million gallons per day) 13,051 36 742 14,488 11.10 0.23 13,319 36 963 14,588 11.40 0.37 13,755 36 976 16,809 11.60 0.32 14,430 36 999 17,533 9.60 0.39 14,959 35 1,025 17,533 11.70 0.32 Wastewater # of residential customers # of multifamily customers # of commercial customers Sewer Service Connections Sewage Treated (millions gallons per day) 12,962 36 372 16,144 3.73 13,298 36 363 16,743 3.73 13,599 36 364 16,856 3.82 14,231 38 382 16,918 4.15 14,877 36 370 16,918 4.20 372 12.50 260 24.00 264 30.00 296 19.20 1,166 2,255 2,016 2,069 2,841 3,018 Other Public Works Street resurfacing (miles) Potholes repaired Citizen & Neighborhood Resources # of new Code Enforcement cases processed per year Source: City Financial Records and Reports NA - information is not readily available at time of production (1) Large increase is due to a one-time hiring of special census employees (2) Large increase is due to inclusion of library visitors in FY2016 Page 178 Table 23 2015 2016 2017 2018 2019 25,320 26,323 26,792 29,911 29,673 536 503 592 816 631 15,404 36 1,055 17,533 12.70 0.63 16,132 36 865 17,034 11.70 0.63 16,713 36 846 17,899 12.90 0.38 13,950 36 839 18,552 12.90 0.13 18,715 41 841 20,211 12.40 NA 15,335 69 373 17,139 3.81 16,064 36 382 18,236 4.15 16,649 36 381 18,980 4.36 17,886 36 381 19,340 4.47 18,720 41 446 20,292 4.70 83.23 1,253 109.00 1,339 70.33 756 105.27 1,344 51.56 586 2,863 3,544 3,212 2,738 2,615 Page 179 Table 24 City of Goodyear Capital Asset Statistics by Function Last Ten Fiscal Years (Unaudited) Function Fiscal Year 2014 2015 2010 2011 2012 2013 3 124 6 3 130 6 3 125 6 3 126 6 3 119 6 Highways and Streets Street (miles) Streetlights Traffic signals 704 8,329 72 704 8,438 72 934 8,465 77 934 8,660 84 Culture and Recreation Parks Parks Acreage Swimming Pools Tennis Courts Community Centers 17 204 1 6 1 17 204 1 6 1 17 204 1 6 1 308 2,791 16 308 2,791 16 223 54 5.6 229 57 5.6 Public Safety Police: Stations Police Vehicles Fire Stations Water Water Mains (miles) Fire Hydrants Storage capacity (Millons of Gallons) Wastewater Sanitary Sewers (miles) Storm Sewers (miles) Treatment capacity (MGD) (thousands of gallons) 2016 2017 2018 2019 4 133 6 4 134 7 6 150 6 5 133 6 5 139 5 934 8,832 86 934 8,832 86 934 9,041 89 934 8,651 89 939 9,184 92 945 9,635 93 17 204 1 6 1 17 204 1 6 1 18 206 1 6 1 18 206 1 6 1 18 206 1 6 1 18 206 1 6 1 18 206 1 6 1 308 2,791 16 308 2,796 16 308 2,808 16 308 2,951 16 330 3,031 16 336 3,152 16 326 3,177 16 330 3,348 16 227 57 5.6 229 57 5.6 239 63 5.6 242 55 5.6 254 54 5.6 260 55 5.6 265 N/A 5.6 276 N/A 5.6 Source: City Financial Records and Reports Page 180 FEDERAL AND STATE REPORTS Page 181 Page 182 Independent Auditors’ Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards The Honorable Mayor and City Council Goodyear, Arizona We have audited, 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, the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Goodyear, Arizona as of and for the year ended June 30, 2019, and the related notes to the financial statements, which collectively comprise the City of Goodyear, Arizona’s basic financial statements, and have issued our report thereon dated November 22, 2019. Internal Control over Financial Reporting In planning and performing our audit of the financial statements, we considered the City of Goodyear, Arizona’s internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City of Goodyear, Arizona’s internal control. Accordingly, we do not express an opinion on the effectiveness of the City of Goodyear, Arizona’s internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected, on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or, significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. Page 183 Compliance and Other Matters As part of obtaining reasonable assurance about whether the City of Goodyear, Arizona’s financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose. HintonBurdick, PLLC Gilbert, Arizona November 22, 2019 Page 184 Independent Auditors’ Report on State Legal Compliance The Honorable Mayor and City Council Goodyear, Arizona We have audited the basic financial statements of the City of Goodyear, Arizona for the year ended June 30, 2019, and have issued our report thereon dated November 22, 2019. Our audit also included test work on the City of Goodyear’s compliance with selected requirements identified in the State of Arizona Revised Statutes and the Arizona State Constitution including, but not limited to, Title 28, Chapter 18, Article 2. The management of the City of Goodyear is responsible for the City's compliance with all requirements identified above. Our responsibility is to express an opinion on compliance with those requirements based on our audit; accordingly, we make the following statements: The City of Goodyear established separate funds to account for Highway User Revenue funds and Local Transportation Assistance funds. Highway user revenue fund monies received by the City of Goodyear pursuant to Title 28, Chapter 18, Article 2 and other dedicated state transportation revenues received during the current fiscal year appear to have been used solely for authorized purposes. The funds are administered in accordance with Generally Accepted Accounting Principles. Sources of revenues available and fund balances are reflected in the individual fund financial statements. Our opinion regarding the City’s compliance with annual expenditure limitations has been issued separately with the City’s Annual Expenditure Limitation Report. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and 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 material noncompliance with the requirements referred to above occurred. An audit includes examining, on a test basis, evidence about the City's compliance with those requirements. We believe that our audit provides a reasonable basis for our opinion. In our opinion, The City of Goodyear complied, in all material respects, with the requirements identified above for the year ended June 30, 2019. The purpose of this report is solely to describe the scope of our testing of the applicable compliance requirements identified in the Arizona Revised Statutes as noted above and the results of that testing based on the state requirements. Accordingly, this report is not suitable for any other purpose. HintonBurdick, PLLC Gilbert, Arizona November 22, 2019 Page 185 This page intentionally left blank Page 186 This page intentionally left blank COMPREHENSIVE ANNUAL FINANCIAL REPORT City of Goodyear, Arizona Finance Department 190 North Litchfield Road Goodyear, Arizona 85338 623-932-3015