City of Peoria, Arizona FY23 Annual Comprehensive Financial Report (ACFR) Fiscal Year Ended June 30, 2023 Annual Comprehensive Financial Report For Fiscal Year Ended June 30, 2023 City of Peoria, Arizona City Council Jason Beck, Mayor Denette Dunn, Vice Mayor Jon Edwards,Mayor Pro-Tem Jennifer Crawford, Councilmember Michael Finn, Councilmember Bill Patena, Councilmember Brad Schafer, Councilmember Administrative Staff Henry Darwin, City Manager Kevin Burke, Deputy City Manager Travis Cutright, Deputy City Manager Mike Faust, Deputy City Manager Prepared By Finance Department Sean Kindell, Chief Financial Officer Peter Christensen, Deputy Finance Director City of Peoria Core Values “The City of Peoria team members share a commitment to provide quality service for our community.” 4 Professional ) Ethical 3 Demonstrates professional skills and knowledge needed to perform the job; keeps informed of developments in the professional field and applies this knowledge to the job; encourages and supports the development of subordinate personnel. Maintains the highest standards of personal integrity, truthfulness, honesty, and fairness in carrying out public duties; avoids any improprieties; trustworthy, maintains confidentiality; never uses City position or power for personal gain. Open Communicates effectively orally and in writing; involves appropriate individuals and keeps others informed; acts as a team member; participates and supports committees/boards/commissions/task forces; approachable; receptive to new ideas; supports diversity and treats others with respect; actively listens. 6 Responsive - Innovative % Accountable Consistently emphasizes and supports customer service; takes responsibility to respond to all customers in a prompt, efficient, friendly, and patient manner; represents the City in an exemplary manner with civic groups/organizations and the public. Demonstrates original thinking, ingenuity, and creativity by introducing new ideas or courses of action; supports innovative problem-solving by identifying and implementing better methods and procedures; takes responsible risks; demonstrates initiative and “follows through” on development and completion of assignments. Accepts responsibility; committed to providing quality service to our community; plans, organizes, controls and delegates appropriately; work produced is consistent and completed within required timeframes; implements or recommends appropriate solutions to problems; acknowledges mistakes; manages human and financial resources appropriately. Introductory Section CITY OF PEORIA, ARIZONA ANNUAL COMPREHENSIVE FINANCIAL REPORT For the Year Ended June 30, 2023 TABLE OF CONTENTS Page I. INTRODUCTORY SECTION Letter of Transmittal Certificate of Achievement for Excellence in Financial Reporting City of Peoria Organizational Chart Principal Officials of the City City Council Pictures and District Map v xiii xiv xv xvi II. FINANCIAL SECTION Independent Auditors’ Report 1 A. MANAGEMENT’S DISCUSSION AND ANALYSIS 5 B. BASIC FINANCIAL STATEMENTS Government-wide Financial Statements Statement of Net Position Statement of Activities 19 20 Fund Financial Statements Governmental Fund Financial Statements Balance Sheet Reconciliation of the Balance Sheet to the Statement of Net Position - Governmental Activities Statement of Revenues, Expenditures, and Changes in Fund Balances Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances Of Governmental Funds to the Statement of Activities - Governmental Activities Budgetary Comparison Statements - General Fund and Major Special Revenue Funds: General Fund Half-Cent Sales Tax Fund Highway User Revenue Fund Transportation Sales Tax Fund 22 25 26 29 30 31 33 34 Proprietary Fund Financial Statements Statement of Net Position Statement of Revenues, Expenses, and Changes in Fund Net Position Statement of Cash Flows 36 38 40 Fiduciary Fund Financial Statements Statement of Net Position Statement of Changes in Fiduciary Net Position Notes to the Financial Statements 44 45 47 i CITY OF PEORIA, ARIZONA ANNUAL COMPREHENSIVE FINANCIAL REPORT For the Year Ended June 30, 2023 Page C. REQUIRED SUPPLEMENTARY INFORMATION Schedule of the City’s Proportionate Share of the Net Pension/OPEB Liability Cost-Sharing Pension Plan Schedule of Changes in Net Pension Liability (Asset) and Related Ratios Schedule of Changes in Net OPEB Liability and Related Ratios Schedule of Pension/OPEB Contributions Notes to Pension/OPEB Plan Schedules 87 88 90 92 94 D. SUPPLEMENTARY INFORMATION - COMBINING FUND FINANCIAL STATEMENTS AND BUDGETARY COMPARISON SCHEDULES Major Governmental Funds Other Than General Fund and Special Revenue Funds Budgetary Comparison Schedules – Major Debt Service Fund and Major Capital Projects Fund General Obligation Bonds Debt Service Fund Development Fee Fund Non-Bond Capital Projects Fund 97 98 99 Non-Major Governmental Funds Combining Statements Combining Balance Sheet Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Budgetary Comparison Schedules Public Transit Fund Other Grant Fund Smart and Safe Arizona Fund Municipal Development Authority (MDA) Debt, Debt Service Fund Community Facilities District (CFD) Bonds Debt Service Fund Non-Bond Debt Service Fund Community Facilities District (CFD) Bonds Capital Projects Fund General Obligation Bonds Capital Projects Fund 102 104 106 107 108 109 110 111 112 113 Internal Service Funds Combining Statement of Net Position Combining Statement of Revenues, Expenses, and Changes in Fund Net Position Combining Statement of Cash Flows 115 116 117 Fiduciary Funds Combining Statement of Net Position Combining Statement of Changes in Fiduciary Net Position ii 119 120 CITY OF PEORIA, ARIZONA ANNUAL COMPREHENSIVE FINANCIAL REPORT For the Year Ended June 30, 2023 Table Page I II III IV V VI VII VIII IX X XI XII XIII XIV XV 123 124 126 127 128 129 130 131 132 133 134 135 136 137 140 XVI 141 XVII 142 XVIII 143 XIX XX 144 145 XXI XXII XXIII XXIV XXV XXVI 146 147 148 149 150 151 XXVII XXVIII XXIX 152 153 154 III. STATISTICAL SECTION - Unaudited Net Position By Component Changes in Net Position Fund Balances, Governmental Funds Changes in Fund Balances, Governmental Funds City Transaction Privilege Taxes By Category Direct and Overlapping Sales Tax Rates Sales Tax Payers - By Category Assessed Values By Property Classification Comparative Assessed Values Direct and Overlapping Property Tax Rates Direct and Overlapping Property Tax Levies Limited Property Value Top Ten Tax Payers Property Tax Levies and Collections Utility Statistical Data Outstanding Debt By Type Ratio of Net General Bonded Debt to Full Cash Value and Net Bonded Debt Per Capita Direct and Overlapping General Obligation Bonded Debt – Current Fiscal Year Direct and Overlapping Governmental Activities Debt – Current Fiscal Year Direct and Overlapping Governmental Activities Debt – Last Ten Fiscal Years Legal Debt Margin Pledged Revenue Coverage – Excise Tax and State Shared Revenue Debt Obligations - Governmental Portion Pledged Revenue Coverage – Water & Wastewater Revenue Bonds Pledged Revenue Coverage – Special Assessment Bonds Special Assessment Collections Demographic and Economic Statistics Major Employers Within the City Authorized Full-time Equivalent City Government Employees By Function Operating Indicators By Function/Program Capital Asset Statistics By Function/Program IV. CONTINUING DISCLOSURES Continuing Disclosures Annual Report 155 iii iv January 23, 2024 Honorable Mayor, City Council, City Manager and Citizens of Peoria, Arizona: We are pleased to submit to you the Annual Comprehensive Financial Report (ACFR) for the City of Peoria, Arizona (the City) for the fiscal year ended June 30, 2023. This report was prepared by the Financial Services Division of the Finance Department. The ACFR represents management’s report of the City’s complete financial results to its governing body, constituents, legislative and oversight bodies, investors, and creditors. Copies of this report will be sent to elected officials, management personnel, bond rating agencies, Nationally Recognized Municipal Securities Information Repositories, and other agencies that have expressed interest in the City’s financial matters. Copies of this financial report will also be placed in the City’s libraries, as well as on the City’s website, for access by the public. The Management’s Discussion and Analysis presented on pages 5-18 has a different focus and purpose than this transmittal letter and should be read in conjunction with this transmittal. THE FINANCIAL REPORTING ENTITY This ACFR includes financial statements on both a government-wide and fund basis for the City as the primary government, as well as its component units. Component units are separate legal entities included in the reporting entity due to the significance of their financial or operational relationship with the City. Criteria used by the City for inclusion of activities in preparing its financial statements are in conformity with GASB Statement No.14, The Financial Reporting Entity, as amended. Blended component units, although legally separate entities, are, in substance, part of the primary government’s operations and are included as part of the primary government. Accordingly, the financial reporting entity consists of the City and seven blended component units, the City of Peoria Municipal Development Authority, Inc., the Vistancia Community Facilities District, the Vistancia West Community Facilities District, the Vistancia North Community Facilities District, the Mystic at Lake Pleasant Heights Community Facility District, the City of Peoria Employee Benefits Trust and the City of Peoria Workers’ Compensation Trust as discussed further in Note 1.A of the notes to the financial statements. The City, chartered in 1954, has a Council-Manager form of government with the City Council consisting of the Mayor and six Council Members. Pursuant to an amendment to the City Charter approved by the voters in 1997, the Mayor is elected at-large for a four-year term. Council members are elected, by district, for 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 Judge. The City Manager is responsible for carrying out the policies and ordinances of the City Council, as well as overseeing the day-to-day operations of the City. The City encompasses approximately 179 square miles in the northcentral portion of Maricopa County, and is one of several major cities comprising the greater Phoenix metropolitan area. Between the 2010 census and the 2020 census, Peoria’s population increased by 24.0%, from 154,065 in 2010 to 190,985 in 2020. The most recent estimate of Peoria’s population is 199,424. Peoria is known for its high quality v of life with safe, well-planned neighborhoods, a diversity of housing options, excellent school districts, extensive park system and recreation programs. An expanded metropolitan freeway system allows Peoria residents to commute effectively to other cities in the Phoenix metropolitan area, giving residents access to the metropolitan area’s diverse array of employment opportunities. The City provides a full range of municipal services, including police, fire and emergency medical services, water, sewer and solid waste services, street construction and maintenance, recreational and cultural events, library services, public transportation, planning and zoning services, and general administrative services. In addition, the City offers a wide range of community facilities including two community centers, three swimming pools, two libraries, and 35 neighborhood parks encompassing 311 acres. The Peoria Sports Complex—operated by the City—was the nation’s first two-team baseball spring training facility and the spring training home of the Seattle Mariners and San Diego Padres. The City opened its first large community park, Rio Vista Community Park, in the southern part of the City in fiscal year 2004. This 52 acre facility has athletic fields, playgrounds, ramadas, an urban lake, skate park and other amenities for the citizens’ enjoyment. The City’s second community park, Pioneer Community Park was completed in fiscal year 2014 and includes ball fields, multipurpose fields, a dog park, fishing lake and other amenities. The third community park, Paloma Community Park, opened in October, 2020. Similar to the Rio Vista and Pioneer parks, the Paloma Community Park offers residents a wide range of recreational activities including a huge fishing lake, large multipurpose fields, pickleball courts and other amenities. The City also has a performing arts center with a 250-seat main auditorium, 80-seat black box theater, and classroom and administrative space in the downtown area. Another attraction of the City is Lake Pleasant, in northern Peoria’s Lake Pleasant Regional Park. This 10,000 acre lake is the second largest lake in Arizona, providing residents and visitors with boating, fishing, camping and other outdoor recreation activities. LOCAL ECONOMIC CONDITION AND OUTLOOK Peoria’s population growth continues to be strong with an estimated increase of 45,359 or 29.4% since the 2010 census. Maricopa County continued to lead the nation with the largest population gain, 56,831 residents, in 2022. The leading catalysts for moving to Arizona last year, according to people who made the switch, were retirement attractiveness, job opportunities and lifestyle changes. Peoria is part of the Phoenix Metropolitan Area which has seen strong job growth in recent years. The construction of the $12 billion Taiwan Semiconductor Manufacturing Company (TSMC) on the outskirts of Peoria is expected to increase in-migration both domestically and internationally to the Peoria area in the next several years. This is further expected to have a multiplier effect as TSMC suppliers also relocate or expand to this region as evidenced by the recent announcement of the semiconductor packaging and testing company Amkor who will be investing $2 billion and hiring 2,000 employees in Peoria in the next few years The City issued 245 new single family residential building permits in fiscal year 2023, a decrease of 75% versus the prior year as the housing market continued to slow. Per the Case-Schiller Home Price index, house prices decreased in the Phoenix metropolitan area during the first six months of fiscal year 2023, but have been rising every month since January 2023. The City’s total property full cash value, which lags the market, increased by 27.7% from $26.4 billion in 2022-23 to $33.7 billion in 2023-24. The unemployment rate in Peoria at October 2023 was 3.6% outperforming both Arizona, 4.4%, and the U.S. rate, 3.9%. The City’s sales and use tax collections in fiscal year 2023 totaled $130.7 million, a 4.1% increase from the $125.6 million in the prior year. Economic Outlook The economic outlook for fiscal year 2024 is mixed. Key economic indicators such as unemployment and job growth remain strong. However, local and state sales tax growth slowed considerably in fiscal year 2023 and indications early in fiscal year 2024 are that the growth will slow even more. This is in part due to the reduction in inflation rates which were driving some of the sales tax growth. As noted above, home values dropped in the first half of fiscal year 2023, but are rising again. This is tempered by reduced new home construction as high interest rates have affected the housing market. State shared income tax, vi which lags actual tax collections by two years, will hit an all time high in fiscal year 2024 before expected reductions in fiscal years 2025 and 2026 as the City sees the full impact of the State’s flat tax. Peoria’s diversified economy with no heavy dependence on any particular industry appears to be weathering the negative indicators thus far. Due to an historic conservative budgeting approach, Peoria is well positioned to address a slowing economy without a reduction of City services and will continue to take a cautious approach moving forward in the light of the uncertain economic indicators. MAJOR PROJECTS AND INITIATIVES The Peoria Mayor and City Council have adopted three policy priorities as of January 2023. These are Water Security, Public Safety and Economic Development. In addition, the new City Manager adopted the administrative priority of Innovative Government. WATER SECURITY Colorado River Water Reductions The federal government declared a Tier 2a water supply shortage on the Colorado River for calendar year 2023. This reduced Peoria’s water allocation from the river a negligible 1-2%. This will not directly impact Peoria’s water delivery as it currently only uses approximately 60% of the water allocation each year and stores the remainder. This practice of storage, over the years, has resulted in a total water storage volume equal to approximately five-and-a-half years supply of water assuming no water is received from the Colorado River or any other source. This smart water planning has allowed Peoria to comfortably meet its water obligations as well as service entitled new developments. After a very strong winter snow season in the Colorado River Basin, in August 2023 the Bureau of Reclamation announced that the Colorado River system will revert to a Tier 1 shortage for Calendar Year 2024. Under a Tier 1 shortage, the City will not have any reductions to the water allocation. New Wellfield at Lake Pleasant Parkway and the Central Arizona Project canal Although the Colorado River water supply improved in the past year, the drought situation continues and the City is taking steps to mitigate the impact of potential future shortages. One way to do this is to prepare the infrastructure to utilize the water that has been stored for delivery to customers. To this end, the City has committed over $60 million, including $10 million pledged by the State, to the contruction of a wellfield and pumping station near Lake Pleasant Parkway and the Central Arizona Project canal. This project will assure residents and businesses in North Peoria of continued water supply in the event of curtailments or outages in Colorado River water supply. Expansion of Reclaimed Water Service The fiscal year 2024 ten year capital improvement program includes over $70 million to expand and improve the City’s reclaimed water network. By expanding this network the City will be able to deliver reclaimed water to more customers for parks, golf courses, landscaping and some commercial uses which will reduce the demand on new water supplies. Treatment Facility Expansions The fiscal year 2024 ten year capital improvement program includes over $95 million for expansions at the Beardsley and Jomax Water Reclamation Facilities. These expansions will provide the capacity needed as the City continues to grow. Turf Reduction The City has committed to a turf reduction program which will remove non-programmable turf (on hill sides or sloped areas) from City parks thereby reducing the water requirements without reducing the functionality of the parks. The total project cost is $3.2 million with $2.5 million being provided by a grant from the Arizona Water Infrastructure Finance Authority. vii PUBLIC SAFETY School Resource Officers In June 2023 the City Council approved an amendment to the intergovernmental agreement with Peoria Unified School District to assign four school resource officers (SRO) to support elementary schools within the district. The City already had in place an agreement for SROs to be assigned to the Peoria, Sunrise Mountain, Centennial and Liberty High Schools on the district. The amendment provides an additional four SROs who will each work a variety of elementary schools in the district. The officers participate in educational programs as well as assisting school administrators in investigating and addressing school related criminal activities. New Facilities and Equipment The City has secured a site near Vistancia Boulevard and Twin Buttes Road to construct a joint public safety facility that will house a fire station and a police substation. The facility will provide better emergency response times to the surrounding communities. The City is planning to create and equip a real-time crime center. The real-time crime center uses technology to capture camera feeds from traffic cameras and various businesses that the City contracts with to provide real-time situational information to police officers responding to calls. The Mayor secured a $2.7 million earmark from the state legislature to assist in paying for this new service. The City received $1.5 million in funding from the State to replace a Police Command Vehicle. Additionally, the City will be using approximately $2.5 million to purchase a new Utility Vehicle and Water Tender for the Fire Department. The Utility Vehicle will provide scene support, lighting, hydration, a refill station for Self-Contained Breathing Apparatus (SCBA) bottles and an air-conditioned rehab area for emergency personnel, including Police officers, on working incidents. The 3000 gallon Water Tender will be at Lake Pleasant Station 199 for wildland and structural firefighting in the northern portion of the city where fire hydrants are limited or non-existent. Pension Liabilities Reduction The City of Peoria made a conscious effort to reduce the unfunded liabilities associated with both its Police and Fire pension plans. Both plans are governed and managed by the Arizona Public Safety Personnel Retirement System (PSPRS). Consistent with the city’s Pension Funding Policy, the Mayor and City Council approved a lump sum payment in FY23 above the Annual Required Contribution (ARC) of $6 million. Under the Pension Funding Policy the City has kept its public safety pension contribution rates the same as in fiscal year 2022 despite the ARC being lowered due to additional payments being made. Peoria must reach 100% funding by 2036. With these efforts, the City is projecting achieving full funding in approximately 2031. Police Aviation Unit As the City continues to grow, additional police and fire resources are required to meet the needs of the citizens. To better serve the public, the Peoria Police Department is creating an aviation unit. The unit will expand law enforcement capabilities, search and rescue capabilities, and firefighting services, and increase response times throughout the city. City Council approved the purchase of a helicopter and the lease of a hangar at Glendale Airport to house the aviation unit. The State provided $3.5 million for the purchase of the helicopter. viii ECONOMIC DEVELOPMENT AMKOR Technology Recently Amkor Technology announced that it had selected Peoria as the future home to the largest U.S.-based advanced semiconductor packaging and testing facility. The facility is expected to bring 2,000 jobs and $2 billion in local investment. The first phase of the manufacturing plant is targeted for production to begin within the next two to three years. Downtown Redevelopment The City of Peoria has dedicated $15 million dollars to renovate its historic downtown. Over the last decade, the City has acquired multiple properties, demolished dilapidated buildings and/or remediated contaminated sites. The area is now prepped for new construction and businesses. As such, the City has sought and acquired a restauranteur to operate in a to-be-constructed city building, hired CBRE to market the area, and soliciting an architect to assist with design themes. The Downtown Redevelopment project also includes renovation of a historic schoolhouse with the intention of becoming an Arts & Culture center. New Industrial Space Peoria is experiencing a spurt in new industrial buildings primarily in the southern portion of the City. These are being rapidly filled with companies relocating from California, elsewhere in Valley, and expanding businesses. INNOVATIVE GOVERNMENT Office of Innovation In fiscal year 2023 the City Manager created the office of innovation. This office works with departments to assess processes and policies and to seek out more effective and efficient ways of doing business. The office will also provide training on problem solving and continuous improvement. This office oversees performance measure management city-wide. Performance Management Peoria has always been a data driven City. New City Manager Darwin took the organization to another level. A centralized dashboard consisting of performance measures from every department is now reviewed monthly with the department directors. This provides an instantaneous operating report of the organization and leads to numerous questions and process reviews. BOND RATING The City currently maintains the following ratings on its general obligation debt: “AA+” from Standard & Poor’s, “Aaa” from Moody’s and “AAA“ from Fitch. The Excise Tax and State Shared Revenue Obligations received a AAA rating from S&P. For the water and sewer revenue bonds, the ratings are “AA+” from Standard & Poor’s, “Aa2” from Moody’s and “AA+” from Fitch. ix FINANCIAL CONTROLS Internal Controls The management of the City of Peoria 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 the cost of a control should not exceed the benefits likely to be derived, and 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, 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 in March 2003, the citizens of Peoria approved a permanent adjustment of the expenditure base from the original 1979-80 base of $3,247,857 to a new base of $18,247,857. The permanent adjustment eliminated the need for voter approval every four years. After adjustment for inflation and population growth, the City’s expenditure limitation for fiscal year 2022-23 was $1,125,073,900. The City may utilize the additional expenditure authority for any local budgetary purposes. The City maintains budgetary controls to ensure compliance with legal provisions embodied in the annual appropriated operating budget approved by the Mayor and Council. Activities of the general fund, special revenue funds, debt service funds, capital project funds, enterprise funds, and internal service funds are included in the annual appropriated budget. The legal level of budgetary control (i.e., the level at which expenditures cannot legally exceed the appropriated amount) is the total budget, as adopted by the City Council. The City additionally exercises management control and oversight of the budget at the department level within each fund. 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 rebudgeted as needed in the next fiscal year. Financial Policies The City has an important responsibility to its citizens to carefully account for public funds, to manage its finances wisely, and to plan for the adequate funding of services desired by the public, including the provision and maintenance of public facilities. The City needs to ensure that it is capable of adequately funding and providing those government services desired by the community. Ultimately, the City’s reputation and success depends on the public’s awareness and acceptability of the management and delivery of these services. The City operates under a comprehensive set of financial policies adopted by Council. The Principles of Sound Financial Management establishes guidelines for the City’s overall fiscal planning and management. These principles are intended to foster and support the continued financial strength and stability of the City of Peoria as reflected in its financial goals. The City’s financial goals are broad, fairly timeless statements of the financial position the City seeks to attain: x     To deliver quality services in an affordable, efficient and cost-effective basis providing full value for each tax dollar. To maintain an adequate financial base to sustain a sufficient level of municipal services, thereby preserving the quality of life in the City of Peoria. To have the ability to withstand local and regional economic fluctuations, to adjust to changes in the service requirements of our community, and to respond to changes in Federal and State priorities and funding as they affect the City's residents. To maintain a high bond credit rating to ensure the City’s access to the bond markets and to provide assurance to the City's taxpayers that the City government is well managed and financially sound. These policies establish minimum and recommended fund balance/net position and reserves, as well as establishing policies on the use of one-time revenues (to be used for one-time expenditures), fiscal planning and budgeting, expenditure control, capital improvement program, cash management, debt management, and economic development. Long Term Financial Planning The City annually updates a five-year long-range forecast, incorporating both projected revenues and expenditures for the City’s major operating funds. The five-year revenue forecast only includes revenues that are anticipated to be sustainable over the five-year period. Expenditure projections include anticipated operating impacts of the adopted capital improvement program. Additionally, the City maintains a 10-year Capital Improvement Program that the City Manager submits annually for review by the City Council. The program is updated annually and includes the cost of construction and operating expenditures. No capital improvement project will be authorized or awarded until the funding sources have been established to finance the project. When current revenues or resources are available for Capital Improvement Projects, consideration will be given first to those capital assets with the shortest useful life, and for assets whose nature make them comparatively more difficult to finance with bonds or lease financing. OTHER INFORMATION Responsibility for the accuracy of the presented data and the completeness and fairness of the presentations in this ACFR, including all disclosures, rests with the management of the City. The City has established and maintains a comprehensive internal control framework that is designed both to protect the government’s assets from loss, theft, or misuse and to allow the compilation of sufficient reliable information for the preparation of financial statements. We believe the data, as presented in this report, is accurate in all material respects and is presented in a manner that fairly sets forth the financial position and results of operations of the City on both a government-wide and fund basis. Furthermore, we believe that all disclosures necessary to enable the reader to gain an understanding of the City's financial activity and financial stability have been included. These financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) for local governments as prescribed by the Governmental Accounting Standards Board (GASB) and the American Institute of Certified Public Accountants (AICPA). Independent Audit The basic financial statements and related notes have been audited by an independent firm of certified public accountants, CliftonLarsonAllen LLP., whose report is included herein. The audit satisfies Article VI, Section 7, of the City Charter, which requires an annual audit of all accounts of the City by an independent certified public accountant. As stated in the independent auditors’ report, the goal of the independent audit was to provide reasonable assurance that the financial statements of the City of Peoria, Arizona, for the fiscal year ended June 30, 2023, are free from material misstatement. The independent audit involved examining, on a test basis, evidence supporting the amounts and disclosures xi in the financial statements; assessing accounting principles used and significant estimates made by management; and evaluating the overall financial statement presentation. The independent auditors concluded, based upon the audit, that there was a reasonable basis for rendering an unmodified opinion that the financial statements of the City for the fiscal year ended June 30, 2023, are fairly presented, in all material respects, in conformity with GAAP. The independent auditors’ report is presented as the first component of the financial section of this report. Additionally, the City is required to have an independent audit (“Single Audit”) of federal financial assistance received by the City directly from federal agencies, or passed through to the City by the State of Arizona or other governmental entities during the fiscal year. The standards governing Single Audit engagements require the independent auditor to report not only on the fair presentation of the financial statements, but also on the government’s internal controls and compliance with legal requirements having a direct and material impact on major programs, with special emphasis on internal controls and compliance requirements involving the administration of major federal awards. There were no instances of material weakness or significant deficiencies reported related to the financial statement audit. Award The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City for its Comprehensive Annual Financial Report for the fiscal year ended June 30, 2022. This is the 38th consecutive year the City of Peoria has received this prestigious award. In order to be awarded a Certificate of Achievement, a government must publish an easily readable and efficiently organized comprehensive annual financial report. That report must satisfy both generally accepted accounting principles and applicable legal requirements. A Certificate of Achievement is valid for one year only. We believe our current Annual Comprehensive Financial Report continues to meet the Certificate of Achievement program's requirements. As such, we are submitting this report to the GFOA to determine its eligibility for a certificate. Acknowledgments The preparation of this Annual Comprehensive Financial Report could not have been accomplished without the efficient and dedicated services of the staff of the Finance Department, especially the Financial Services Division. We want to give special recognition to the City’s accounting team for their diligent efforts and superior contributions to this report. We also wish to thank the members of the City Council for their interest and support in planning and conducting the financial affairs of the City in a responsible and progressive manner. Sincerely, Sean Kindell Chief Financial Officer xii Government Finance Officers Association Certificate of Achievement for Excellence in Financial Reporting Presented to City of Peoria Arizona For its Annual Comprehensive Financial Report For the Fiscal Year Ended June 30, 2022 Executive Director/CEO City of Peoria Organizational Chart Peoria Citizens Citizens Advisory Boards and Commissions Presiding Judge George Anagnost Municipal Court Mayor and City Council Henry Darwin City Manager Emily Jurmu City Attorney Christine Nickel Human Resources Director Rick Buss Assistant City Manager Brandon Urness Mayor’s Chief of Staff Scott Kurish Office of Innovation Director Brenda Urias Assistant to the City Manager Kevin Burke Deputy City Manager Travis Cutright Deputy City Manager Marylou Stephens Arts, Cultural and Library Services Director Agnes Goodwine City Clerk Sean Kindell Finance and Budget Director Kris Dalmolin Information Technology Director Gary Bernard Fire Chief Chris Calcaterra Parks and Recreation Director Rhonda Humbles Public Works Director David Burks Water Services Director Mike Faust Deputy City Manager Jennifer Stein Economic Development Director Adina Lund Development and Engineering Director Thomas Intreri Police Chief Chris Hallet Neighborhood and Human Services Director Diane Arthur Office of Communications Director Chris Jacques Planning & Community Development Director xiv City of Peoria Principal Officials of the City Fiscal Year 2023 Jason Beck Mayor Denette Dunn Jon Edwards Michael Finn Brad Shafer Vice Mayor Councilmember Mayor Pro Tem Councilmember Jennifer Crawford Councilmember Bill Patena Councilmember Henry Darwin City Manager Kevin Burke Deputy City Manager Travis Cutright Deputy City Manager Mike Faust Deputy City Manager Marylou Stephens Emily Jurmu Lori Dyckman Arts, Culture and Library Services Director City Attorney City Clerk Diane Arthur Adina Lund Jennifer Stein Director of Communications Development and Engineering Director Economic Development Services Director Sean Kindell Gary Bernard Christine Nickel Chief Financial Officer Fire Chief Human Resources Director Kris Dalmolin George Anagnost Chris Hallett Information Technology Director Municipal Judge Neighborhood & Human Services Director Chris Calcaterra Chris Jacques Art Miller Parks, Recreation & Community Facilities Director Planning and Community Development Director Police Chief Rhonda Humbles David Burks Public Works Director Water Services Director xv City of Peoria Council Districts Lake Pleasant Mayor Jason Beck Mesquite Pine District Mayor Pro Tem Jon Edwards Willow District 67th Ave. Vice Mayor Denette Rae Dunn Carefree Hwy Willow Ironwood Councilmember Jennifer Crawford Acacia District Councilmember Brad Shafer Mesquite District 115th Ave. Councilmember Bill Patena Ironwood District Bell Rd. Palo Verde Peoria Ave. Councilmember Michael Finn Palo Verde District Youth Council Liaison Ana Shrivastava Youth Council Liaison Alliyz Whetstine xvi Pine Northern Ave. Acacia Financial Section CliftonLarsonAllen LLP CLAconnect.com INDEPENDENT AUDITORS' REPORT The Honorable Mayor and Members of City Council City of Peoria, Arizona Peoria, Arizona Report on the Audit of the Financial Statements Opinions We have audited the accompanying financial statements of the governmental activities, the businesstype activities, each major fund, and the aggregate remaining fund information of the City of Peoria, Arizona (City) as of and for the year ended June 30, 2023, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents. 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, as of June 30, 2023, and the respective change in financial position, and, where applicable, cash flows thereof and the respective budgetary comparisons for the general fund, half-cent sales tax special revenue fund, highway user revenue special revenue fund, and transportation sales tax special revenue fund for the year then ended in accordance with accounting principles generally accepted in the United States of America. Basis for Opinions We conducted our audit in accordance with auditing standards generally accepted in the United States of America (GAAS) and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the City and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Responsibilities of Management for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. CLA (CliftonLarsonAllen LLP) is an independent network member of CLA Global. See CLAglobal.com/disclaimer. 1 The Honorable Mayor and Members of City Council City of Peoria, Arizona In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter. Auditors’ Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements. In performing an audit in accordance with GAAS and Government Auditing Standards, we:  Exercise professional judgment and maintain professional skepticism throughout the audit.  Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.  Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, no such opinion is expressed.  Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.  Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the City’s ability to continue as a going concern for a reasonable period of time. We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit. 2 The Honorable Mayor and Members of City Council City of Peoria, Arizona Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis and the schedule of the City’s proportionate share of the net pension and OPEB liability and contributions, as listed in the table of contents, be presented to supplement the basic financial statements. Such information is the responsibility of management and, 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 GAAS, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Supplementary Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The combining and individual nonmajor fund financial statements and budgetary comparison schedules are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with GAAS. In our opinion, the combining and individual nonmajor fund financial statements and schedules are fairly stated, in all material respects, in relation to the basic financial statements as a whole. Other Information Management is responsible for the other information included in the annual report. The other information comprises the introductory and statistical sections but does not include the basic financial statements and our auditors’ report thereon. Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon. In connection with our audit of the basic financial statements, our responsibility is to read the other information and consider whether a material inconsistency exists between the other information and the basic financial statements, or the other information otherwise appears to be materially misstated. If, based on the work performed, we conclude that an uncorrected material misstatement of the other information exists, we are required to describe it in our report. 3 The Honorable Mayor and Members of City Council City of Peoria, Arizona Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated January 23, 2024, on our consideration of the City’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control over financial reporting and compliance. CliftonLarsonAllen LLP Phoenix, Arizona January 23, 2024 4 Management’s Discussion & Analysis MANAGEMENT’S DISCUSSION AND ANALYSIS As management of the City of Peoria, Arizona (the City), we offer this narrative overview and analysis of the financial activities of the City of Peoria, Arizona for the fiscal year ended June 30, 2023. 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. This discussion and analysis (MD&A) has a different focus and purpose than the transmittal letter presented on pages v-xii of this report. It 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. The City also issues separate financial reports, including management’s discussion and analysis, for the Vistancia Community Facilities District, Vistancia West Community Facilities District, Vistancia North Community Facilities District, Mystic at Lake Pleasant Heights Community Facilities District, the Employee Benefit Trust, and the Workers’ Compensation Trust, which are blended component units of the City. Financial Highlights  The City’s total net position increased $71.7 million, 4.2%, in fiscal year 2023, an increase of $50.6 million, 5.3%, in governmental activities and an increase of $21.1 million, 2.8%, in business-type activities.  Total net position of the City is $1,781.4 million, of which $203.6 million is unrestricted.  At June 30, 2023, total fund balance of the governmental funds was $377.8 million, an increase of $47.4 million from the previous year. Of this, $126.2 million or 67.9% of General Fund expenditures for fiscal year 2023 was unassigned and available for spending at the government’s discretion.  General Fund revenues (on a budgetary basis) were higher than budgeted inflows by $22.5 million for fiscal year 2023. Budgetary basis expenditures of the General Fund were 88.2% ($26.5 million in savings) of the final budgeted expenditures as the City continued cost saving measures due to the uncertainty about future revenues. OVERVIEW OF THE FINANCIAL STATEMENTS As pictured in the following illustration, the financial section of the Annual Comprehensive Financial Report (ACFR) for the City of Peoria, Arizona consists of this discussion and analysis, the basic financial statements, other required supplementary information and other non-required financial schedules. The basic financial statements include the government-wide financial statements, fund financial statements, including the budgetary statements for the general fund and major special revenue funds, and notes to the financial statements. Other required supplementary information includes the schedules and notes related to pension and OPEB requirements. The additional non-required information includes combining schedules and other supplementary schedules presented after the basic financial statements (Combining Statements and Statistical Sections of this report). 5 Required Components of the Annual Financial Report Management’s Discussion and Analysis Basic Financial Statements Required Supplementary Information Governmentwide Financial Statements Fund Financial Statements Notes to the Financial Statements Summary Detail Government-wide Financial Statements The government-wide financial statements are designed to provide a broad overview of the City’s finances in a manner similar to those used by private businesses. All of the activities of the City, except those of a fiduciary nature, are included in these statements. The activities of the City are broken into two columns on these statements – governmental activities and business-type activities. A total column for the City is also provided.  The governmental activities include the basic services of the City including general government (administration), culture and recreation, public safety, development services, highways and streets, public works, and human services. These activities are generally supported by taxes and general revenues.  The business-type activities include the private sector type activities such as the water, wastewater solid waste, and storm drain utilities, and the stadium. These activities are primarily supported through user charges or fees. The statement of net position presents information on all of the City’s assets and liabilities (excluding fiduciary funds), both current and long-term and deferred inflows/outflows of resources, with the difference reported as net position. The focus on net position is designed to be similar to the emphasis for businesses. Over time, increases or decreases in net position may serve as a useful indicator of how the financial position of the City may be changing. Increases in net position may indicate an improved financial position; however, even decreases in net position may reflect a changing manner in which the City may have used previously accumulated funds (i.e. cash funding of capital projects). To assess the overall health of the City, other indicators, including non-financial indicators such as the City’s property tax base and condition of its infrastructure, should also be considered. The statement of activities presents information showing how the City’s net position changed over the most recent fiscal year. Since full accrual accounting is used for the government-wide financial statements, all changes to net position are reported at the time the underlying event giving rise to the change occurs, regardless of the timing of the related cash flows. This statement also focuses on both the gross and net costs of the various functions of the City, based only on direct functional revenues and expenses. This is designed to show the extent to which the various functions depend on general taxes and revenues for support. 6 Fund Financial Statements Also presented are fund financial statements for governmental funds, proprietary funds and fiduciary funds. The fund financial statements focus on major funds of the City. A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or conditions. Funds are used to ensure and demonstrate compliance with finance-related legal requirements as well as for managerial control to demonstrate fiduciary responsibility over the assets of the City. Governmental funds – Governmental funds are used to account for most of the City’s basic services. These are essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the governmental activities column on the government-wide financial statements, these fund financial statements focus on near-term inflows and outflows of spendable resources as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in determining what financial resources are available in the near future to finance the City’s programs. Since the governmental fund financial statements focus on near-term spendable resources, while the governmental activities on the government-wide financial statements have a longer-term focus, it may be useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the government’s near-term financing decisions. To facilitate this comparison, reconciliations of the differences between the two are provided immediately following the governmental fund balance sheet and the governmental fund statement of revenues, expenditures and changes in fund balances. The City maintains several individual governmental funds organized according to their type (special revenue, debt service, and capital projects). Information is presented separately in the governmental fund balance sheet and the governmental fund statement of revenues, expenditures and changes in fund balances for the General Fund, Highway User Revenue Fund, Transportation Sales Tax Fund, GO Bond Debt Service Fund, Development Fee Fund, and Non-Bond Capital Projects Fund which are considered to be major funds of the City. Data from the remaining governmental funds are combined into a single, aggregated presentation. Individual fund data for each of the non-major governmental funds is provided in the form of combining statements. Proprietary funds – Proprietary funds are used to account for services primarily supported by user fees. The proprietary fund financial statements are prepared with the same long-term focus as the governmentwide financial statements. The City maintains the following two types of proprietary funds. Enterprise funds are used for activities that primarily serve customers outside the governmental unit. The enterprise funds generally provide information similar to the business-type activities column of the government-wide financial statements, but provide more detail and additional information such as cash flows. Any reconciliation necessary between the enterprise funds and the business-type activities column of the government-wide financial statements is provided on the face of the fund statements. The City’s enterprise funds are the Water, Wastewater, Storm Drain and Solid Waste utilities, as well as the sports complex (Stadium Fund). All of the enterprise funds are considered to be major funds of the City. Internal service funds are used for activities where the primary customer is the City itself. Because the primary customers of the internal service funds are the governmental activities, the assets, liabilities, and deferred outflows/inflows of resources of those funds are included in the governmental activities column of the government-wide statement of net position. The costs of internal service funds are allocated to the various user functions on the government-wide statement of activities. The internal service funds are combined into a single column on the proprietary fund statements. Additional detail of the internal service funds is provided in combining statements. The internal service funds of the City include the Motor Pool, Self-Insurance, Facilities Maintenance, and Information Technology Funds. 7 Fiduciary funds – Fiduciary funds are used to account for resources held for the benefit of others. Fiduciary funds are not included in the government-wide financial statements because the resources of those funds are not available to support programs of the City. The fiduciary fund statements are prepared on the same basis as the government-wide and proprietary fund statements. Notes to the financial statements – The notes to the financial statements provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements and should be read with the financial statements. Required supplementary information other than MD&A – Schedules for pension/OPEB plans have been provided as required supplementary information. GOVERNMENT-WIDE FINANCIAL ANALYSIS The following tables, graphs and analysis discuss the financial position and changes to the financial position for the City as a whole as of and for the year ended June 30, 2023, with comparative information for the previous year. Net Position Net position may serve over time as a useful indicator of a government’s financial position. The following table reflects the condensed Statement of Net Position of the City for June 30, 2023, compared to the prior year. Statement of Net Position As of June 30 (in millions of dollars) Governmental Activities Business‐type Activities Total Primary Government 2023 2022 2023 2022 Current and other assets Capital assets $ 495.6 941.3 $ 442.9 939.8 $ 170.1 752.9 $ 170.5 737.6 Total assets 1,436.9 1,382.7 923.0 908.1 2,359.9 2,290.8 Total deferred outflows of resources 56.3 79.5 3.6 4.6 59.9 84.1 Other liabilities Long‐term liabilities outstanding 51.2 431.2 49.7 412.9 12.4 125.0 10.8 129.8 63.6 556.2 60.5 542.7 Total liabilities 482.4 462.6 137.4 140.6 619.8 603.2 Total deferred inflows of resources 13.9 53.3 4.7 8.7 18.6 62.0 735.1 147.1 114.7 $ 996.9 732.2 133.0 81.1 $ 946.3 662.3 33.3 88.9 $ 784.5 640.4 48.9 74.1 $ 763.4 1,397.4 180.4 203.6 $ 1,781.4 1,372.6 181.9 155.2 $ 1,709.7 Net position: Net investment in capital assets Restricted Unrestricted Total net position 2023 $ 665.7 1,694.2 2022 $ 613.4 1,677.4 The net position of the City increased $71.7 million in fiscal year 2023. Net position of governmental activities increased $50.6 million, while the business-type activities increased $21.1 million. The 4.2% growth in net position reflects the strength of Peoria’s economy and the City’s efforts to control costs while providing valuable services to the public. Net position consists of three components. The largest portion of net position, $1,397.4 million reflects the City’s investment in capital assets net of accumulated depreciation and any related outstanding debt used to acquire or construct those assets. The City uses these capital assets to provide services to its residents. Consequently, it is not the City’s intention to sell these assets, and they are therefore not available for future spending. Although the capital assets are reported net of related debt, it should be 8 noted that the resources needed to repay this debt must be provided from other sources, since the capital assets themselves are not intended to be used to liquidate these liabilities. The $180.4 million restricted portion of the City’s net position represents resources that are subject to external restrictions on how they may be used. The third portion consists of Unrestricted Net Position of $203.6 million. This category of net position may be used to meet the City’s ongoing obligations to residents and creditors. Unrestricted net position is the balance of net position remaining after calculating the other two categories discussed above. Changes in Net Position The following table compares the government-wide revenue and expenses for the current and previous fiscal year. Cha nges i n Net Pos i ti on As of June 30 (in millio ns o f do llars) Governmental Activi ti es 2023 2022 REVENUES: Progra m revenues : Fees , fines & charges for s ervices Opera ti ng grants a nd contri butions Ca pital grants a nd contributi ons General revenues Property ta xes Sa les and us e taxes Franchis e ta xes State s hared s al es tax Urba n revenue s haring Auto‐i n‐li eu ta xes Inves tment ea rnings (l os s es ) Mis cel la neous Tota l revenues EXPENSES: Progra m a cti vities : Governmenta l a cti vities : General government Culture a nd recrea tion Publi c s a fety Devel opment s ervi ces Highwa ys a nd s treets Publi c works Huma n s ervi ces Interes t expens e on debt Bus i nes s ‐type a cti vities : Wa ter util ity Wa s tewater util ity Soli d Wa s te util ity Stadi um Storm Drai n util ity Tota l expens es Exces s (defi cit) before tra ns fers Trans fers and Speci a l Items Increa s e (decrea s e) in net pos ition Net pos i ti on ‐ beginning Net pos i ti on ‐ endi ng $ 35.7 29.9 15.4 $ 36.3 26.2 36.5 Bus i nes s ‐type Acti viti es 2023 2022 $ 108.7 ‐ 18.0 $ 100.8 ‐ 19.9 Tota l Prima ry Government 2023 2022 $ 144.4 $ 137.1 29.9 33.4 26.2 56.4 34.0 131.0 5.2 28.8 37.0 9.7 6.4 3.6 336.7 31.4 125.5 5.0 26.8 24.8 8.3 (6.6) 3.6 317.8 ‐ ‐ ‐ ‐ ‐ ‐ 3.0 ‐ 129.7 ‐ ‐ ‐ ‐ ‐ ‐ (3.0) ‐ 117.7 34.0 131.0 5.2 28.8 37.0 9.7 9.4 3.6 466.4 31.4 125.5 5.0 26.8 24.8 8.3 (9.6) 3.6 435.5 37.3 45.0 108.7 6.8 51.9 8.6 4.9 7.3 29.3 39.0 95.6 7.2 59.8 7.5 3.5 6.3 ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 37.3 45.0 108.7 6.8 51.9 8.6 4.9 7.3 29.3 39.0 95.6 7.2 59.8 7.5 3.5 6.3 ‐ ‐ ‐ ‐ ‐ 270.5 66.2 (15.6) 50.6 946.3 $ 996.9 ‐ ‐ ‐ ‐ ‐ 248.2 69.6 (3.4) 66.2 880.1 $ 946.3 61.4 30.5 18.1 9.6 4.6 124.2 5.5 15.6 21.1 763.4 784.5 61.4 30.5 18.1 9.6 4.6 394.7 71.7 57.1 32.6 16.4 7.3 4.9 366.5 69.0 71.7 1,709.7 $ 1,781.4 69.0 1,640.7 1,709.7 $ 57.1 32.6 16.4 7.3 4.9 118.3 (0.6) 3.4 2.8 760.6 $ 763.4 $ For fiscal year 2023, total governmental activities revenues increased $18.9 million while total businesstype activities revenues increased $12.0 million. Expenses increased $22.3 million for the governmental 9 activities and increased $5.9 million for the business-type activities. The increase in expenses was primarily due to labor costs and inflationary factors. The general revenues of governmental activities increased $36.9 million with the largest increase coming from Urban revenue sharing (shared state income taxes). State income tax allocations to the cities lag two years behind collections, so the increase in fiscal year 2023 represents the increased collections in fiscal year 2021 that resulted from the income tax deferrals available in fiscal year 2020 due to the pandemic. The program revenues of business-type activities increased by $6.0 million primarily due to rate increases in the utility funds and increased spring training revenues for the stadium fund resulting from a return to pre-pandemic scheduling. The following graph shows the functional revenues and expenses of governmental activities to demonstrate the extent to which the governmental functions produce direct revenues to offset the program costs. It should be noted that this is not intended to represent full cost allocation to these functions. Expenses not covered by direct program revenues are covered by general revenues of the City, primarily taxes and state shared revenues. In the governmental activities, the program revenues of $81.0 million are 30.1% of the governmental activities expenses for fiscal year 2023, down from 39.9% in fiscal year 2022. The decrease is primarily due to a decrease in capital grants and contributions resulting from a slow down in residential development activity. In the business-type activities, program revenues of $126.7 million are 102.0% of the business-type expenses for fiscal year 2023. This compares to $120.7 million and 102.0% in fiscal year 2022. Governmental activities account for 72.2% of the total revenues of the City and 68.5% of the total expenses in fiscal year 2023. These percentages were 73.0% and 67.7% respectively in fiscal year 2022. 10 As seen in the following graph, one of the largest financing sources for the City in fiscal year 2023 is charges for services (31.0%), primarily because this is the major funding source of the business-type activities (83.8% of business-type total revenues in fiscal year 2023). The major funding sources of the governmental activities are property taxes, sales/use taxes, contributed capital and state shared revenues. Property taxes increased from fiscal year 2022 with an increase in assessed value plus growth in the City. The total City (primary plus secondary) tax rate did not change in fiscal year 2023 compared to the previous year. Total government-wide expenses of the City increased $27.2 million, 7.4% in fiscal year 2023. mentioned above, this was primarily due to labor costs and inflationary factors. As As shown in the following Government-Wide Functional Expenses graph, business-type activities account for 31.5% of the functional expenses of the City for fiscal year 2023, while governmental activities account for 68.5% of the functional expenses. For the governmental activities, the largest users of resources are public safety (27.5% of total expense, 40.2% of governmental expenses), highways and streets (13.1% of total expenses, 19.2% of governmental expenses), culture and recreation (11.4% of total expenses, 16.6% of governmental expenses), and general government (9.5% of total expenses, 13.8% of governmental expenses). 11 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 governmental fund financial statements is to provide information on near-term inflows, outflows and balances of spendable resources. All major governmental funds are discretely presented on these financial statements, while the non-major funds are combined into a single column. Combining statements for the non-major funds may be found in the section of the ACFR immediately following the Required Supplementary Information. Although the Highway User Revenue Fund, Transportation Sales Tax Fund, Development Fee Fund, and General Obligation Bond Debt Service Fund do not meet the GASB 34 quantitative criteria of a major fund, the City has chosen to present them as major funds due to local significance or outstanding debt. The fund balance of the governmental funds is $377.8, an increase of $47.4 million from the previous year. Of this, $169.8 million (an increase of $17.1 million from the previous year) is classified as Nonspendable or Restricted because it is not appropriable for expenditure or is legally segregated for a specific future use. The increase is primarily due to increased balances in funds restricted for transportation purposes. An additional $81.8 million of the governmental fund balance (an increase of $3.1 million from the previous year) has been committed or assigned for specific purposes by council or administrative action. These commitments include various stabilization reserves ($59.5 million), debt service reserves ($1.0 million), capital projects ($11.1 million) and arts capital and various other purposes ($10.2 million). The remaining $126.2 million of governmental fund balance is classified as Unassigned. This balance may serve as a useful indicator of a government’s net resources available for spending at the end of the year. By Council policy, these resources are used to fund one-time needs of the City including capital facilities and transportation improvements. The unassigned fund balance increased by $27.2 million compared to the prior year. 12 Governmental Funds ‐ Fund Balance 250 FY22 Millions 200 FY23 150 100 50 ‐ The General Fund is the chief operating fund of the City and accounts for many of the major functions of the government including public safety, parks and recreation, community development and general administrative services. General Fund revenues increased $29.1 million over the prior fiscal year. State shared revenues accounted for over half of that with an increase of $15.6 million. The majority of the state shared revenue increase was due to a $12.2 million increase in urban revenue sharing (shared state income tax). Primary property taxes increased 6.5% in fiscal year 2023 as opposed to 7.1% in the prior fiscal year reflecting increased property values but a slow down in growth in the City. General Fund expenditures decreased $8.0 million in fiscal year 2023 from fiscal year 2022. In fiscal year 2022 the City made an additional contribution of $35 million to the Public Safety Personnel Retirement System to decrease the unfunded liability. That payment is reflected in the fiscal year 2022 expenditures, but was not repeated in fiscal year 2023. Therefore, the actual operating expenditures increased by approximately $27 million due to increased labor costs and inflation. The Highway User Revenue Fund (HURF Fund) is required by state statute to track the receipt of the state allocation of gasoline taxes and other state revenues shared with local governments that are required to be used for transportation purposes. Also, there is a sales tax on utilities and property tax revenues from streetlight improvement districts included in this fund. Revenues increased by $2.1 million in fiscal year 2023 reflecting increased revenues as well as Peoria’s increased share of state revenues based on the last census results. Fund balance increased $4.4 million in fiscal year 2023. The Transportation Sales Tax Fund tracks the collection and expenditure of the 0.3% voter approved sales tax to address transportation issues. Revenues in this fund increased $2.3 million while expenditures increased $1.7 million. The City continues to invest in the Streets capital program to maintain the high quality of Peoria roads while budgeting conservatively to assure the ability to provide for future transportation needs. The fund balance increased $3.6 million in fiscal year 2023. All fund balance in this fund is restricted. The Development Fee Fund, which collects governmental impact fees for parks and recreational facilities, public safety, and streets and intersections had a decrease in revenues of $3.5 million in fiscal year 2023 as development activity continued to slow. Expenditures decreased $7.9 million in fiscal year 2023 as growth related capital projects were delayed. Fund balance increased $3.1 million versus the prior year. All fund balance in this fund is restricted. 13 The GO Bond Debt Service Fund accounts for the payment of general obligation bonds and the related interest. Revenues in this fund increased by $1.7 million due to increased property valuations and growth. The Non-Bond Capital Projects Fund primarily accounts for reimbursements for shared projects with other governments and the expenditures are mostly for street related projects. All non-major governmental funds of the City are combined into one column on the governmental fund statements. 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. Although the Solid Waste, Stadium and Storm Drain Funds do not meet the quantitative criteria of a major fund, the City has chosen to present these funds as major funds due to local significance. Total net position of the enterprise funds increased $20.9 million in fiscal year 2023. Net investment in capital assets increased $21.9 million due to growth and replacement in the water and wastewater systems. Net position restricted for capital projects decreased by $15.7 million due to the use of proceeds from revenue bonds in project construction. Unrestricted net position increased by $14.6 million. In accordance with the City’s Principles of Sound Financial Management, the City continues to maintain appropriate levels of stabilization reserves. Operating revenues of the enterprise funds increased $7.9 million in fiscal year 2023. A return to normal spring training operations following the pandemic resulted in a $4.2 million increase in Stadium Fund operating revenues. Operating expenses of the enterprise funds increased $4.6 million in fiscal year 2023 primarily due to labor costs and inflation. The changes in operating revenues and expenses discussed above resulted in an enterprise funds operating loss of $12.7 million in fiscal year 2023 following an operating loss of $16.0 million in the prior year. The following graph shows the operating revenues and expenses for the enterprise funds for fiscal year 2023. Fiscal Year 2023 Enterprise Fund Operating Revenues and Expenses 70 60 Revenues Millions 50 Expenses 40 30 20 10 0 Water Wastewater Solid Waste 14 Stadium Storm Drain BUDGETARY HIGHLIGHTS The City’s annual budget is the legally adopted expenditure control document of the City. Budgetary comparison statements, required for the General Fund and all major special revenue funds, may be found on pages 30-34. These statements compare the original adopted budget, the budget as amended throughout the fiscal year, and the actual expenditures prepared on a budgetary basis. Budgetary schedules for the other governmental funds are also presented on pages 97-99, and pages 106-113. General Fund revenues of $208.8 million, on a budgetary basis, exceeded budgeted revenues of $186.2 million by $22.6 million due to conservative budgeting and continued growth in local as well as state shared sales taxes. Budgetary basis expenditures of $197.2 million were 88.2% of final budgeted amounts primarily due to lower capital spending as inflation and supply issues delayed some capital projects. Revenues, on a budgetary basis, were less than budgeted revenues in licenses and permits and rents. Police and Fire had slight, less than 1%, expenditure overages for functional departmental categories. During the fiscal year, the original General Fund expenditures and contingencies budget of $248.4 million was reduced by $8.9 million to the final expenditure and contingencies budget of $239.5 million. Notable budgetary transfers during the year were as follows:     $11.1 million transfer from the Half Cent Fund to the General Fund for the public safety subsidies. $3.6 million transfer from the Half Cent Fund to the Stadium Fund as a subsidy in support of the Peoria Sports Complex. $3.3 million transfer from the Transportation Sales Tax Fund to the Public Transit Fund in support of the transit system. Various transfers to the debt service funds to meet debt service requirements. CAPITAL ASSET AND DEBT ADMINISTRATION Capital Assets As of June 30, 2023, the City had $1.4 billion invested in various capital assets, net of accumulated depreciation and related debt. The capital assets of the City (net of depreciation, but not capital debt) are $1.7 billion. This is a net increase of $16.8 million from June 30, 2022. Net capital assets of businesstype activities increased $15.3 million while governmental activities increased $1.5 million. Notable additions to capital assets during the fiscal year included the following:     The City spent $9.3 million to expand its reclaimed water infrastructure to better utilize reclaimed water and help preserve the City’s new water supply. The City invested $14.3 million into new construction and improvements to streets and traffic control around the City. The City spent $14.0 million for expansion of the Beardsley Water Reclamation Facility in fiscal year 2023 bringing the total for the project to $25.0 million. The City spent $3.3 million toward construction of a new operations building at the Jomax Water Reclamation Facility bringing the total project cost to $7.4 million. 15 The following table provides a breakdown of the capital assets of the City at June 30, 2023, and 2022. Additional information on the City’s capital assets may be found in Note 6. Capital Assets at June 30 (Net of depreciation) (in millions of dollars) Governmental Activities 2023 2022 Buildings and building improvement Equipment; Furniture Vehicles Surface water system Street system Park system Water system Water rights Wastewater system SBITA Intangible Assets Land Work in progress Total $ 97.0 2.1 12.3 ‐ 260.4 97.4 ‐ ‐ ‐ 2.2 438.0 31.9 $ 941.3 $ 102.0 3.6 14.1 ‐ 268.8 101.2 ‐ ‐ ‐ ‐ 425.2 24.9 $ 939.8 Business‐type Activities 2023 2022 $ 43.4 2.1 12.4 69.6 ‐ ‐ 244.9 8.8 240.9 ‐ 18.8 112.0 $ 752.9 $ 45.7 2.8 12.6 71.8 ‐ ‐ 246.7 9.0 249.1 ‐ 18.8 81.1 $737.6 Total Primary Government 2023 2022 $ 140.4 4.2 24.7 69.6 260.4 97.4 244.9 8.8 240.9 2.2 456.8 143.9 $ 1,694.2 $ 147.7 6.4 26.7 71.8 268.8 101.2 246.7 9.0 249.1 ‐ 444.0 106.0 $ 1,677.4 The City has adopted a ten year capital improvement plan budgeted at $1,104.1 million, including $410.6 million in fiscal year 2024. Anticipated funding for this plan for fiscal year 2024 is through a combination of impact fees, utility revenue bonds, general obligation bonds, operating revenues, City and County transportation sales taxes and other outside funding sources. The estimated operating budget impact of the capital improvement program over the next five fiscal years is expected to be $16.7 million. The capital improvement plan is updated annually as part of the City’s budget process. Long-term Debt The City’s outstanding long-term debt (due in more than one year), including bonds and loans, leases, SBITA, compensated absences, and deferred bond premiums was $339.4 million at June 30, 2023. Of this total, $240.5 million was in governmental activities and $98.9 million was in business-type activities. The City’s outstanding debt (due in more than one year excluding claims and net pension liability) decreased by $0.6 million in fiscal year 2023. Of the total outstanding bonds and loans of $337.5 million, $177.0 million is general obligation bonds or loans backed by the full faith and credit of the City. The outstanding debt also includes $23.1 million in Community Facilities District bonds where the City has no obligation for payment. All other outstanding debt is secured by pledges of specific revenue sources of the City. The State constitution imposes certain debt limitations on the City of six percent (6%) and twenty percent (20%) of the assessed valuation of the City. Additional information on the debt limitations and capacities may be found in Table XX in the statistical section of this report. 16 The following schedule shows the outstanding debt of the City (both current and long-term, excluding premium, net pension liability and claims payable) as of June 30, 2023, and 2022. Further detail on the City’s outstanding debt may be found in Note 7. Information on the City’s net pension/OPEB liability may be found in the Required Supplementary Section of the report and in Note 9. Outstanding Debt (in millions of dollars) Governmental Business‐type Activities Activities 2023 2022 2023 2022 General obligation debt $ 177.0 Excise tax revenue obligations 21.0 Direct Purchase and Loan Obligations 15.7 Water/Sewer Revenue bonds and loans ‐ Community Facilities District bonds 23.1 Compensated absences 18.8 SBITA 1.9 $ 257.5 Total $ 165.7 21.5 19.6 ‐ 23.5 17.2 2.9 $ 250.4 $ ‐ ‐ ‐ 100.7 ‐ 2.1 ‐ $ 102.8 $ ‐ ‐ ‐ 108.5 ‐ 1.9 ‐ $110.4 Total Primary Government 2023 2022 $ 177.0 21.0 15.7 100.7 23.1 20.9 1.9 $ 360.3 $ $ 165.7 21.5 19.6 108.5 23.5 19.1 2.9 360.8 The City currently maintains the following ratings on its general obligation debt: “AA+” from Standard & Poor’s, “Aaa” from Moody’s and “AAA“ from Fitch. For the water and sewer revenue bonds, the ratings are “AA+” from Standard & Poor’s, “Aa2” from Moody’s and “AA+” from Fitch. ECONOMIC FACTORS Although local sales tax revenues continued to grow in fiscal year 2023, the growth of 4.1% was significantly smaller than the double digit growth in the prior two fiscal years. Retail sales tax, the City’s largest category, increased by 6.0% over the prior year. Both contracting and utilities sales taxes decreased from fiscal year 2022 levels. Additionally, beginning January 1, 2025 the City will no longer be collecting residential rental sales tax. Therefore, budget projections are intentionally conservative and show minimal change in future sales tax revenue levels. Peoria’s housing market has slowed somewhat as rising interest rates and high inflation have tempered demand. The long-term outlook for Peoria continues to be very strong with the expectation that Arizona will continue to outpace the nation in growth and income related metrics. The adopted fiscal year 2024 budget is $950 million, an increase of 21.3% from the fiscal year 2023 budget. The operating budget totals $539.4 million, which is an increase of 8.3% from 2023. The capital projects portion of the budget, $410.6 million, is divided in the following manner: $28.6 million for drainage projects, $64.8 million for operational facilities, $25.3 million for parks, trails, open space and libraries, $15.2 million for public safety projects, $66.7 million for streets and traffic control projects, $39.0 million for economic development projects, $75.7 million for wastewater projects, and $95.3 million for water projects. The General Fund operating budget is $215.9 million, up 13.9% from the prior year budget. With the uncertainty surrounding the economy, resident needs for City services were balanced with a slowly increasing revenue base. The budget continues to focus on preserving the City’s excellent quality of life, while preserving our future financial viability. The City has maintained cash balances over the last few years, both for financial stability and in anticipation of the capital and ongoing operational needs of an ever-changing city. The City has maintained several stabilization reserves within the General Fund in accordance with the City’s adopted financial policies – The Principles of Sound Financial Management. The City also maintains working capital policy reserve, rate stabilization, and debt stabilization reserves in the Utility Funds. It should be noted that while these reserves are established to address immediate and dramatic fiscal difficulties, they 17 are not intended to cover structural budget shortfalls. With this in mind, the fiscal year 2024 budget does not anticipate the use of reserves to address recurring expenses. FINANCIAL CONTACT This financial report is designed to provide a general overview of the City of Peoria, Arizona’s finances and to demonstrate accountability for the use of public funds. Questions about any of the information provided in this report, or requests for additional financial information should be addressed to the City’s Chief Financial Officer at the following address: City of Peoria, 8401 W. Monroe Street, Peoria, Arizona 85345. 18 Basic Financial Statements CITY OF PEORIA, ARIZONA STATEMENT OF NET POSITION JUNE 30, 2023 Governmental Activities ASSETS Pooled cash and investments $ 375,307,253 Cash with fiscal agents 296,327 Accounts receivable, net 19,195,126 Lease receivable 8,566,991 Interest receivable 1,679,668 Internal balances (4,860,740) Due from other governments 4,579,898 Prepaid items 13,421 Supply inventories 580,267 Restricted pooled cash and investments 21,023,442 Restricted cash with fiscal agents 5,814,103 Restricted investments 58,510,539 Investments in Joint Venture Agreements 1,652,072 Net other postemployment benefits asset 3,196,884 Capital assets: Non-depreciable or amortizable 469,899,882 Depreciable or amortizable (net) 471,398,637 Total assets 1,436,853,770 DEFERRED OUTFLOWS OF RESOURCES Deferred outflows related to pensions and other 54,761,884 postemployment benefits Deferred loss on bond refunding 1,528,765 Excess consideration provided for acquisition Total deferred outflows of resources 56,290,649 LIABILITIES Accounts payable 17,772,188 Accrued payroll 4,257,938 Interest payable 3,950,313 320,803 Due to other governments Customer deposits 38,921 Other liabilities 4,381,890 Unearned revenue-other 20,484,643 Non-current liabilities: Due within one year: Current portion of claims payable 8,234,981 Current portion of compensated absences 8,281,657 Current portion of bonds & loans payable 24,814,097 Current portion of lease payable 6,925 Current portion of SBITA payable 966,171 Due in more than one year: Noncurrent portion of claims payable 907,894 Noncurrent portion of compensated absences 10,542,147 Noncurrent portion of bonds & loans payable 229,028,914 Noncurrent portion of lease payable 8,123 Noncurrent portion of SBITA payable 949,013 Net pension and other postemployment benefits liablilities 147,420,589 Total liabilities 482,367,207 DEFERRED INFLOWS OF RESOURCES 8,256,580 Deferred inflows related to leases Deferred inflows related to pensions and other postemployment benefits Total deferred inflow of resources NET POSITION Net investment in capital assets Restricted for: Debt service Capital projects Development fees Transportation purposes Grant purposes Facilities maintenance Public safety Trust purpose Net other postemployment benefits Unrestricted Total net position $ Primary Government Business-type Activities $ 128,553,637 13,457,453 3,939,881 577,555 4,860,740 1,155,684 726,458 765 16,281,759 573,269 $ 503,860,890 296,327 32,652,579 12,506,872 2,257,223 4,579,898 1,169,105 1,306,725 21,023,442 5,814,868 74,792,298 1,652,072 3,770,153 130,841,871 622,045,637 923,014,709 600,741,753 1,093,444,274 2,359,868,479 2,576,710 1,005,618 3,582,328 57,338,594 1,528,765 1,005,618 59,872,977 6,482,390 512,701 1,703,038 167,138 2,061,426 1,481,257 5,153 24,254,578 4,770,639 5,653,351 487,941 2,100,347 5,863,147 20,489,796 949,026 8,728,843 2,423 - 8,234,981 9,230,683 33,542,940 9,348 966,171 1,125,901 97,705,359 9,269 - 907,894 11,668,048 326,734,273 17,392 949,013 16,468,014 137,401,938 163,888,603 619,769,145 3,822,056 12,078,636 5,631,513 13,888,093 894,864 4,716,920 6,526,377 18,605,013 735,144,237 662,256,419 1,397,400,656 23,563,585 40,838,089 49,155,886 7,912,006 10,879 2,086,576 20,286,020 3,196,884 114,694,957 996,889,119 32,651,553 100,000 573,269 88,896,938 $ 784,478,179 23,563,585 32,651,553 40,838,089 49,155,886 7,912,006 110,879 2,086,576 20,286,020 3,770,153 203,591,895 $ 1,781,367,298 The accompanying notes are an integral part of the financial statements 19 Total CITY OF PEORIA, ARIZONA STATEMENT OF ACTIVITIES FOR THE YEAR ENDED JUNE 30, 2023 Net (Expense) Revenue and Changes in Net Position Program Revenues Expenses Functions/Programs Governmental activities: General government Culture and recreation Public safety Development services Highways and streets Public works Human services Interest on long-term debt $ Total governmental activities Business-type activities: Water Utility Wastewater Utility Solid Waste Utility Stadium Storm Drain Utility Total business-type activities Total primary government 37,273,981 45,008,300 108,735,210 6,827,829 51,902,098 8,629,505 4,857,735 7,307,398 Fees, Fines & Charges for Services Operating Grants and Contributions $ $ 270,542,056 35,733,582 61,406,938 30,287,509 18,141,399 9,623,372 4,602,541 54,272,090 26,577,247 17,180,515 8,951,236 1,556,380 394,603,815 4,182,329 540,041 1,656,514 280,106 14,521,341 8,670,127 - 1,000,000 525,959 13,804,409 91,003 - 29,850,458 15,421,371 - 108,537,468 124,061,759 $ 3,103,323 7,486,067 9,339,383 3,539,186 4,563,914 7,612,397 89,312 - $ 144,271,050 Capital Grants and Contributions $ 17,954,815 $ (28,988,329) (36,982,192) (97,213,354) (3,008,537) (19,012,434) (1,017,108) 3,992,707 (7,307,398) Business-type Activities $ (189,536,645) 9,574,758 4,040,600 4,339,457 $ 29,850,458 Governmental Activities 33,376,186 Change in net position Net position - beginning Net position - ending $ The accompanying notes are an integral part of the financial statements 20 (28,988,329) (36,982,192) (97,213,354) (3,008,537) (19,012,434) (1,017,108) 3,992,707 (7,307,398) (189,536,645) - 2,439,910 330,338 (960,884) (672,136) 1,293,296 - 2,430,524 2,430,524 2,430,524 (187,106,121) 6,712,827 27,258,369 131,030,117 5,240,846 Total general revenues and transfers $ - (189,536,645) General revenues: Taxes: Property taxes, levied for general purposes Property taxes, levied for debt service Sales and use taxes Franchise taxes Intergovernmental: State shared sales taxes- unrestricted Urban revenue sharing- unrestricted Auto in-lieu taxes- unrestricted Investment earnings Miscellaneous Transfers in (out) - Total 2,439,910 330,338 (960,884) (672,136) 1,293,296 - 6,712,827 27,258,369 131,030,117 5,240,846 28,812,810 36,976,059 9,669,103 6,404,789 3,641,910 (15,646,720) 2,994,854 15,646,720 28,812,810 36,976,059 9,669,103 9,399,643 3,641,910 - 240,100,110 18,641,574 258,741,684 50,563,465 21,072,098 71,635,563 946,325,654 763,406,081 1,709,731,735 996,889,119 $ 784,478,179 $ 1,781,367,298 21 CITY OF PEORIA, ARIZONA BALANCE SHEET GOVERNMENTAL FUNDS JUNE 30, 2023 Major Funds ASSETS Assets: Pooled cash and investments Cash with fiscal agents Accounts receivable, net Lease receivable Interest receivable Due from other funds Due from other governments Prepaid items Supply inventories Restricted cash with fiscal agents Restricted investments Total assets $ $ LIABILITIES, DEFERRED INFLOWS OF RESOURCES & FUND BALANCES Liabilities: Accounts payable Accrued payroll Interest payable Due to other funds Due to other governments Customer deposits Other liabilities Unearned revenue-other Total liabilities Deferred Inflows of Resources: Unavailable revenue-property taxes Related to leases Unavailable revenue - other Total deferred inflows of resources Fund Balances: Nonspendable: Supply inventories Prepaid items Restricted for: Debt service Capital projects Development fees Transportation purposes Public safety Grant purposes Arts Center maintenance Committed to: Debt service Economic development Arts capital Operating reserve Emergency reserve Budget stabilization reserve Assigned to: Capital projects Municipal Complex reserve Unassigned Total fund balance Total liabilities, deferred inflows of resources & fund balance $ General Fund Highway User Revenue Fund Transportation Sales Tax Fund GO Bond Debt Service Fund Development Fee Fund 187,755,986 21,327 15,583,992 8,566,991 947,815 2,279,691 1,771,050 194,330 217,121,182 $ 18,166,447 594,347 49,826 1,471,169 123,175 $ 20,404,964 $ $ 17,967,969 29,162 195,268 874,006 $ 19,066,405 $ 41,458,338 124,973 $ 41,583,311 4,035,703 3,738,282 313 320,793 38,921 4,003,936 777,891 12,915,839 $ $ $ $ 702,795 702,795 - 745,222 745,222 5,039 8,256,580 136,401 8,398,020 - - - - 194,330 - 123,175 - - - - 10,879 18,052,184 - 1,000,000 2,494,875 21,546,367 14,364,245 23,573,041 $ 2,111,642 117,963 2,229,605 $ 29,138,237 2,458,658 86,427 31,683,322 30,980,527 - - 5,604,860 127,018,726 195,807,323 217,121,182 18,175,359 $ 20,404,964 - $ 30,980,527 31,683,322 The accompanying notes are an integral part of the financial statements 22 19,066,405 19,066,405 $ 19,066,405 40,838,089 40,838,089 $ 41,583,311 (continued) CITY OF PEORIA, ARIZONA BALANCE SHEET GOVERNMENTAL FUNDS JUNE 30, 2023 Major Funds ASSETS Assets: Pooled cash and investments Cash with fiscal agents Accounts receivable, net Lease receivable Interest receivable Due from other funds Due from other governments Prepaid items Supply inventories Restricted cash with fiscal agents Restricted investments Total assets Non-bond Capital Projects Fund Non-Major Governmental Funds Total Governmental Funds $ 24,014,554 79,471 411,739 24,505,764 $ 21,308,367 554,357 119,355 730,672 13,421 4,940,097 49,866,944 77,533,213 $ 339,809,898 21,327 19,191,354 8,566,991 1,437,029 2,279,691 4,579,898 13,421 317,505 5,814,103 49,866,944 $ 431,898,161 622,501 59,542 12,724,624 13,406,667 $ 6,050,046 48,214 2,279,691 10 318,381 6,982,128 15,678,470 $ $ LIABILITIES, DEFERRED INFLOWS OF RESOURCES & FUND BALANCES Liabilities: Accounts payable Accrued payroll Interest payable Due to other funds Due to other governments Customer deposits Other liabilities Unearned revenue-other Total liabilities Deferred Inflows of Resources: Unavailable revenue-property taxes Related to leases Unavailable revenue - other Total deferred inflows of resources Fund Balances: Nonspendable: Supply inventories Prepaid items Restricted for: Debt service Capital projects Development fees Transportation purposes Public safety Grant purposes Arts Center maintenance Committed to: Debt service Economic development Arts capital Operating reserve Emergency reserve Budget stabilization reserve Assigned to: Capital projects Municipal Complex reserve Unassigned Total fund balance Total liabilities, deferred inflows of resources & fund balance $ $ $ 14,267,909 3,904,459 313 2,279,691 320,803 38,921 4,381,859 20,484,643 45,678,598 - 567 567 5,606 8,256,580 136,401 8,398,587 - 13,421 317,505 13,421 - 8,433,505 42,135,388 2,086,576 7,912,006 - 27,499,910 42,135,388 40,838,089 49,032,711 2,086,576 7,912,006 10,879 - 2,082,021 - 1,000,000 2,494,875 2,082,021 21,546,367 14,364,245 23,573,041 (808,741) 61,854,176 77,533,213 11,099,097 5,604,860 126,209,985 377,820,976 $ 431,898,161 11,099,097 11,099,097 24,505,764 $ The accompanying notes are an integral part of the financial statements 23 24 CITY OF PEORIA, ARIZONA RECONCILIATION OF THE BALANCE SHEET TO THE STATEMENT OF NET POSITION GOVERNMENTAL ACTIVITIES JUNE 30, 2023 Fund balances - total governmental funds $ 377,820,976 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 governmental funds. Governmental capital assets Less accumulated depreciation and amortization $ 1,487,762,895 (561,293,143) 926,469,752 Other assets used in governmental activities are not financial resources and therefore are not reported in the governmental funds. Other post employment benefits asset Deferred loss on bond refunding 2,887,430 1,528,765 Long-term liabilities, including bonds payable are not due and payable in the current period and therefore are not reported in the governmental funds. Governmental bonds payable Leases payable SBITA payable Compensated absences (236,821,124) (15,048) (1,422,824) (17,553,735) (255,812,731) Equity in joint ventures are not financial resources and, therefore, are not reported in the funds. 1,652,072 Bond premiums are recognized at the time of issuance in the governmental funds, but recognized over the life of the bonds for government-wide reporting (17,021,887) Property tax revenue and other revenues earned but not received within 60 days of year-end is a deferred inflow of resources for the governmental statements, but is recognized as revenue for the government-wide statements 142,007 Interest payable on long-term debt is not reported in the governmental funds. (3,940,656) Internal service funds are used by management to charge the costs of certain activities to individual funds. The assets and liabilities of the internal service funds are reported with the governmental activities. 53,482,551 Long-term liabilities, such as net pension and OPEB liabilities are not due and payable in the current period and, therefore, are not reported as a liability in the funds. (138,531,049) Deferred outflows and inflows of resources related to pensions/OPEB are applicable to future reporting periods and, therefore, are not reported in the funds. Deferred outflows related to pension/OPEB Deferred inflows related to pension/OPEB 53,360,348 (5,148,459) Total net position of governmental activities 48,211,889 $ The accompanying notes are an integral part of the financial statements 25 996,889,119 CITY OF PEORIA, ARIZONA STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS FOR THE YEAR ENDED JUNE 30, 2023 Major Funds General Fund REVENUES: Taxes Intergovernmental Charges for services Licenses and permits Fines and forfeitures Rents Investment earnings (loss) Miscellaneous Total revenues $ EXPENDITURES: Current: General government Culture and recreation Public safety Development services Highways and streets Public works Human services Debt service: Principal payments Interest and other charges Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES): Issuance of debt Premium on bonds issued Transfers in Transfers out Total other financing sources and uses Net change in fund balances Fund balances - beginning Fund balances - ending $ 117,400,220 75,870,654 21,836,933 3,650,883 1,643,286 1,052,182 1,908,867 1,967,408 225,330,433 Highway User Revenue Fund Transportation Sales Tax Fund GO Bond Debt Service Fund Development Fee Fund $ $ $ 21,937,922 45,844 21,983,766 $ 5,547,044 14,521,341 233,353 123,573 2,220 20,427,531 20,025,690 359,627 590,429 20,975,746 26,909,011 31,974,316 113,348,978 5,519,537 6,410,782 - 483 16,628,458 - 4,967,726 - 730,216 43,913 1,004,139 185,940,892 80,000 16,708,941 4,098,547 9,066,273 16,844,188 5,746,514 22,590,702 86,081 1,503,966 39,389,541 3,718,590 11,909,473 (606,936) 3,128,638 860,000 (7,293,649) (6,433,649) 1,000,000 (334,700) 665,300 (8,294,996) (8,294,996) - 32,955,892 4,383,890 3,614,477 (606,936) 3,128,638 27,366,050 30,980,527 19,673,341 $ 19,066,405 37,709,451 $ 40,838,089 (continued) 162,851,431 195,807,323 $ 13,791,469 18,175,359 $ - 4,000,711 631,893 4,632,604 1,317 3,292 1,413,276 - - The accompanying notes are an integral part of the financial statements 26 CITY OF PEORIA, ARIZONA STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS FOR THE YEAR ENDED JUNE 30, 2023 Major Funds REVENUES: Taxes Intergovernmental Charges for services Licenses and permits Fines and forfeitures Rents Investment earnings (loss) Miscellaneous Total revenues Non-bond Capital Projects Fund Non-Major Governmental Funds Total Governmental Funds $ $ 5,350,716 15,887,744 855,053 135,875 1,788,231 1,262,912 25,280,531 $ 170,261,592 106,279,739 29,001,041 3,650,883 1,779,161 1,052,182 5,284,806 3,822,969 321,132,373 503,692 322,033 - 4,928,165 6,613,124 1,471,285 1,182,998 1,304,098 1,275,407 4,828,035 31,837,659 38,588,757 114,823,555 6,702,535 24,817,250 8,008,222 4,828,035 3,625,241 4,450,966 8,383,485 2,703,882 15,257,545 47,948,024 25,957,889 8,494,309 24,151,553 288,209,764 (1,949,204) (22,667,493) 32,922,609 (64,124) (64,124) 31,708,075 1,547,460 7,624,295 (12,278,566) 28,601,264 31,708,075 1,547,460 9,484,295 (28,266,035) 14,473,795 (2,013,328) 5,933,771 47,396,404 55,920,405 61,854,176 330,424,572 $ 377,820,976 EXPENDITURES: Current: General government Culture and recreation Public safety Development services Highways and streets Public works Human services Debt service: Principal payments Interest and other charges Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES): Issuance of debt Premium on bonds issued Transfers in Transfers out Total other financing sources and uses Net change in fund balances Fund balances - beginning Fund balances - ending $ 2,074,991 426,771 2,501,762 13,112,425 11,099,097 $ The accompanying notes are an integral part of the financial statements 27 28 CITY OF PEORIA, ARIZONA RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES - GOVERNMENTAL ACTIVITIES FOR THE YEAR ENDED JUNE 30, 2023 Net change in fund balances - total governmental funds $ 47,396,404 Amounts reported for governmental activities in the statement of activities are different because: Some expenses reported in the statement of activities do not require the use of current financial resources and therefore are not reported as expenditures in governmental funds. (2,002,744) Certain revenues are advances in the governmental funds because they do not provide current financial resources, but are considered revenue on the statement of activities. (25,426) Interest expense in the statement of activities differs from the amount reported in governmental funds because accrued interest was calculated for bonds and notes payable for the statement of activities, but is expensed when due for the governmental fund statements. (408,103) 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 and amortization expense. This is the amount by which capital outlays ($24,151,553) is exceeded by depreciation and amortization ($38,479,170) in the current period. (14,327,617) In the statement of activities, only the gain on the sale of capital assets is reported, whereas in the governmental funds, the proceeds from the sale of capital assets increase financial resources Thus, the change in net position differs from the change in fund balance by the cost of the assets sold or disposed of. Also gains/losses on sales of capital assets are not shown in the governmental funds, but are revenues or expenses on the statement of activities. (23,496) Donations of capital assets are not reflected on the governmental fund statements but are shown in the statement of activities. 13,804,406 The issuance of long-term debt provides current financial resources in the governmental funds, but creates a long-term liability in the statement of activities. (31,708,075) Repayment of bonds principal and lease payments is an expenditure in the governmental funds, but reduces long-term liabilities in the statement of net position. 25,957,889 Bond premiums or discounts and gains or losses on bond refunding are sources or uses of current financial resources for governmental fund reporting when debt is first issued, whereas these amounts are deferred and amortized in the statement of activities. 547,214 Internal service funds are used by management to charge the costs of certain activities to individual funds. The net revenue (expense) of certain internal service funds is reported with governmental activities. 3,040,830 Governmental funds report pension/OPEB contributions as expenditures. However, in the Statement of Activities, pension/OPEB service costs, interest on the pension liability, current year benefit changes, member contributions, expected earnings on plan investments, administrative expenses and recognition of deferred outflows and inflows from pension and OPEB is reported as pension/OPEB expense. 8,312,183 Change in net position of governmental activities $ The accompanying notes are an integral part of the financial statements 29 50,563,465 CITY OF PEORIA, ARIZONA BUDGETARY COMPARISON STATEMENT GENERAL FUND FOR THE YEAR ENDED JUNE 30, 2023 Budgeted Amounts Original Final REVENUES: Taxes Intergovernmental Charges for services Licenses and permits Fines and forfeitures Rents Investment earnings Miscellaneous Total revenues $ EXPENDITURES: Current: General government: Mayor and council City manager Human resources Attorney City clerk Court Economic development Finance Non-departmental Culture and recreation Public safety: Police Fire Development services Public works Debt service: Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES): Contingencies Transfers in Transfers out Total other financing sources and uses Net change in fund balances Fund balances - beginning Fund balances - ending $ 78,316,997 60,880,228 38,431,411 4,568,371 1,139,000 1,273,510 960,125 666,081 186,235,723 $ 78,316,997 60,880,228 38,431,411 4,568,371 1,139,000 1,273,510 960,125 666,081 186,235,723 Variance with Final Budget Over (Under) Actual Amounts (budgetary basis) $ 84,619,651 75,738,998 38,928,186 3,650,883 1,643,286 1,147,180 1,600,136 1,402,408 208,730,728 $ 6,302,654 14,858,770 496,775 (917,488) 504,286 (126,330) 640,011 736,327 22,495,005 911,451 6,510,108 4,485,609 4,464,197 1,479,537 2,784,478 1,857,274 11,854,058 2,014,745 37,078,464 915,951 7,332,659 4,618,609 4,716,197 1,479,537 2,784,478 1,893,530 12,116,828 4,805,957 37,267,111 804,479 6,169,114 3,296,022 4,149,954 1,031,297 2,662,998 1,794,007 11,432,689 4,381,693 31,865,611 (111,472) (1,163,545) (1,322,587) (566,243) (448,240) (121,480) (99,523) (684,139) (424,264) (5,401,500) 59,075,304 44,086,969 62,830,123 50,318,898 62,864,308 50,484,671 34,185 165,773 5,618,418 7,365,071 7,099,406 7,385,071 5,519,537 6,410,782 (1,579,869) (974,289) 19,217,109 208,802,792 18,147,611 223,711,966 4,374,698 197,241,860 (13,772,913) (26,470,106) (22,567,069) (37,476,243) 11,488,868 48,965,111 (39,593,299) 17,234,469 (7,772,102) (30,130,932) (15,771,299) 17,234,469 (7,772,102) (6,308,932) 12,236,757 (7,075,514) 5,161,243 15,771,299 (4,997,712) 696,588 11,470,175 (52,698,001) (43,785,175) 16,650,111 60,435,286 103,990,306 103,990,306 124,717,460 20,727,154 51,292,305 $ 60,205,131 $ The accompanying notes are an integral part of the financial statements 30 141,367,571 $ 81,162,440 CITY OF PEORIA, ARIZONA BUDGETARY COMPARISON STATEMENT HALF-CENT SALES TAX FUND FOR THE YEAR ENDED JUNE 30, 2023 Budgeted Amounts Original Final REVENUES: Taxes Investment earnings(loss) Miscellaneous Total revenues $ EXPENDITURES: Current: General government Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES): Contingencies Transfers out Total other financing sources and uses Net change in fund balances Fund balances - beginning Fund balances - ending $ 30,519,351 142,500 30,661,851 $ 30,519,351 142,500 30,661,851 Variance with Final Budget Over (Under) Actual Amounts (budgetary basis) $ 32,780,569 467,294 565,000 33,812,863 $ 2,261,218 324,794 565,000 3,151,012 3,917,475 5,469,245 9,386,720 6,914,141 4,984,934 11,899,075 4,207,890 229,160 4,437,050 (2,706,251) (4,755,774) (7,462,025) 21,275,131 18,762,776 29,375,813 10,613,037 (20,000,000) (16,496,016) (36,496,016) (10,488,808) (16,496,016) (26,984,824) (16,496,016) (16,496,016) 10,488,808 10,488,808 (15,220,885) (8,222,048) 12,879,797 21,101,845 46,059,222 46,059,222 46,452,133 392,911 30,838,337 $ 37,837,174 $ 59,331,930 NOTE: Although included with the General Fund for GAAP presentation, the Half-Cent Sales Tax Fund is budgeted separately. The accompanying notes are an integral part of the financial statements 31 $ 21,494,756 CITY OF PEORIA, ARIZONA BUDGETARY COMPARISON STATEMENT GENERAL FUND FOR THE YEAR ENDED JUNE 30, 2023 Explanation of differences between budgetary basis and GAAP revenues and expenditures Sources/inflows of resources: Actual amounts (budgetary basis) "Total revenues" from the General Fund budgetary comparison statement Actual amounts (budgetary basis) "Total revenues" from the Half-Cent Sales Tax Fund budgetary comparison statement Differences - budget to GAAP: Interdepartmental service charges are revenue on a budgetary basis, but are eliminated from the financial statements under GASB34's allocation rules The City budgets certain revenues on the cash basis, rather than on the modified accrual basis Total revenues as reported on the statement of revenues, expenditures, and changes in fund balances - governmental funds Uses/outflows of resources: Actual amounts (budgetary basis) "Total expenditures" from the General Fund budgetary comparison statement Actual amounts (budgetary basis) "Total expenditures" from the Half-Cent Sales Tax Fund budgetary comparison statement Differences - budget to GAAP: The City budgets for certain other expenditures on the cash basis, rather than on the modified accrual basis Capital outlay recognized as expenditures in proprietary fund for budgetary purposes, but assets reclassified to expenditure in governmental funds for financial reporting purposes Capital outlay recognized as expenditures for budgetary purposes, but assets capitalized in proprietary funds for financial reporting purposes Capital outlay for capital leases are expenditures for GAAP purposes, but not for budgetary purposes Certain interdepartmental service charges are recognized as expenditures for budgetary purposes but are eliminated from the financial statements under GASB34's allocation rules Total expenditures as reported in the statement of revenues, expenditures, and changes in fund balances - governmental funds The accompanying notes are an integral part of the financial statements 32 $ 208,730,728 33,812,863 (17,091,253) (121,905) $ 225,330,433 $ 197,241,860 4,437,050 1,377,346 (3,599,719) (13,515,645) $ 185,940,892 CITY OF PEORIA, ARIZONA BUDGETARY COMPARISON STATEMENT HIGHWAY USER REVENUE FUND FOR THE YEAR ENDED JUNE 30, 2023 Budgeted Amounts Original Final REVENUES: Taxes Intergovernmental Charges for services Investment earnings(loss) Miscellaneous Total revenues $ EXPENDITURES: Current: General Government Highways and streets Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES): Contingencies Transfers in Transfers out Total other financing sources and uses Net change in fund balances Fund balances - beginning Fund balances - ending $ 4,880,679 13,114,265 135,000 80,000 18,209,944 $ 4,880,679 13,114,265 135,000 80,000 18,209,944 Variance with Final Budget Over (Under) Actual Amounts (budgetary basis) $ 5,547,044 14,521,341 233,353 123,573 2,220 20,427,531 $ 666,365 1,407,076 98,353 43,573 2,220 2,217,587 14,053,707 7,506,657 21,560,364 14,071,161 7,765,784 21,836,945 483 16,628,458 80,000 16,708,941 483 2,557,297 (7,685,784) (5,128,004) (3,350,420) (3,627,001) 3,718,590 7,345,591 (1,500,000) 2,099,179 (1,425,107) (825,928) (1,127,350) 2,099,179 (1,425,107) (453,278) 1,000,000 (334,700) 665,300 1,127,350 (1,099,179) 1,090,407 1,118,578 (4,176,348) (4,080,279) 4,383,890 8,464,169 12,735,921 12,735,921 13,791,469 1,055,548 8,559,573 $ 8,655,642 $ 18,175,359 The accompanying notes are an integral part of the financial statements 33 $ 9,519,717 CITY OF PEORIA, ARIZONA BUDGETARY COMPARISON STATEMENT TRANSPORTATION SALES TAX FUND FOR THE YEAR ENDED JUNE 30, 2023 Budgeted Amounts Original Final REVENUES: Taxes Investment earnings(loss) Miscellaneous Total revenues $ EXPENDITURES: Current: Highways and streets Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES): Contingencies Transfers out Total other financing sources and uses Net change in fund balances Fund balances - beginning Fund balances - ending $ 18,384,099 291,792 18,675,891 $ 18,384,099 291,792 18,675,891 Variance with Final Budget Over (Under) Actual Amounts (budgetary basis) $ 20,025,690 359,627 590,429 20,975,746 $ 1,641,591 67,835 590,429 2,299,855 414,948 27,369,462 27,784,410 474,181 26,243,900 26,718,081 4,967,726 4,098,547 9,066,273 4,493,545 (22,145,353) (17,651,808) (9,108,519) (8,042,190) 11,909,473 19,951,663 (3,500,000) (8,294,996) (11,794,996) (3,976,718) (8,294,996) (12,271,714) (8,294,996) (8,294,996) 3,976,718 3,976,718 (20,903,515) (20,313,904) 3,614,477 23,928,381 21,065,299 21,065,299 27,366,050 6,300,751 161,784 $ 751,395 $ The accompanying notes are an integral part of the financial statements 34 30,980,527 $ 30,229,132 35 CITY OF PEORIA, ARIZONA STATEMENT OF NET POSITION PROPRIETARY FUNDS JUNE 30, 2023 Business-type Activities Major Enterprise Funds Water Utility Wastewater Solid Waste Fund Utility Fund Utility Fund ASSETS Current assets: Pooled cash and investments Restricted pooled cash and investments Restricted cash with fiscal agents Accounts receivable, net Leases receivable Interest receivable Prepaid items Supplies inventory Total current assets Non-current assets: Restricted assets: Cash with fiscal agents Investments Net restricted assets Capital assets: Buildings and improvements Distribution and collection systems Water rights Equipment & furniture Vehicles Lease Assets Intangible-SBITA Less accumulated depreciation and amortization Land and improvements Construction in progress Capital assets, net Net other postemployment benefits asset Total non-current assets Total assets $ DEFERRED OUTFLOWS OF RESOURCES Deferred outflows related to pensions and other postemployment benefits Excess consideration provided for acquisition Total deferred outflows of resources LIABILITIES Current liabilities: Accounts payable Accrued payroll Interest payable Due to other governments Customer deposits Other liabilities Current portion of claims payable Current portion of compensated absences Current portion of bonds & loans payable Current portion of lease payable Current portion of SBITA payable Unearned revenue-other Total current liabilities Non-current liabilities: Long-term portion of claims payable Long-term portion of compensated absences Long-term portion of bonds & loans payable Long-term portion of lease payable Long-term portion of SBITA payable Net pension and other postemployment benefits liablilities Total non-current liabilities Total liabilities DEFERRED INFLOWS OF RESOURCES Deferred inflows related to pensions and other postemployment benefits Deferred inflows related to leases Total deferred inflows of resources NET POSITION Net investment in capital assets Restricted: Capital projects Facilities maintenance Trust purpose Net other postemployment benefits Unrestricted Total net position $ 67,682,033 6,964,025 272,689 1,155,684 726,275 76,800,706 $ 37,904,978 2,981,800 212,069 41,098,847 $ 9,748,976 2,105,565 27,694 183 11,882,418 379 6,639,769 6,640,148 386 9,641,990 9,642,376 - 1,662,522 447,860,205 12,889,805 18,056,536 2,344,044 (225,662,288) 6,867,999 76,424,041 340,442,864 221,017 347,304,029 424,104,735 7,612,045 430,867,633 2,321,429 1,805,115 (196,575,927) 3,878,001 32,069,311 281,977,607 110,212 291,730,195 332,829,042 211,038 19,048,130 (8,619,308) 10,639,860 161,279 10,801,139 22,683,557 1,001,000 1,005,618 2,006,618 499,159 499,159 730,443 730,443 2,505,007 218,092 1,084,288 163,222 2,060,426 444,872 386,113 5,679,050 12,541,070 2,485,866 86,521 618,750 971,508 171,884 3,049,793 7,384,322 322,427 125,628 235,115 683,170 441,294 67,867,572 6,349,044 74,657,910 87,198,980 179,767 29,837,787 3,166,018 33,183,572 40,567,894 257,163 4,632,983 4,890,146 5,573,316 345,004 345,004 172,041 172,041 251,753 251,753 273,158,338 258,642,735 10,639,860 16,304,446 221,017 48,883,568 338,567,369 5,629,036 110,212 28,206,283 $ 292,588,266 184 161,279 6,787,608 17,588,931 (continued) $ The accompanying notes are an integral part of the financial statements 36 CITY OF PEORIA, ARIZONA STATEMENT OF NET POSITION PROPRIETARY FUNDS JUNE 30, 2023 Business-type Activities Major Enterprise Funds Stadium Storm Drain Fund Utility Fund ASSETS Current assets: Pooled cash and investments Restricted pooled cash and investments Restricted cash with fiscal agents Accounts receivable, net Leases receivable Interest receivable Prepaid items Supplies inventory Total current assets Non-current assets: Restricted assets: Cash with fiscal agents Investments Net restricted assets Capital assets: Buildings and improvements Distribution and collection systems Water rights Equipment & furniture Vehicles Lease Assets Intangible-SBITA Less accumulated depreciation and amortization Land and improvements Construction in progress Capital assets, net Net other postemployment benefits asset Total non-current assets Total assets $ 12,317,202 1,227,426 3,939,881 62,869 17,547,378 $ - DEFERRED OUTFLOWS OF RESOURCES Deferred outflows related to pensions and other postemployment benefits Excess consideration provided for acquisition Total deferred outflows of resources 900,448 178,637 2,234 1,081,319 $ - Total Governmental Activities Internal Service Funds 128,553,637 13,457,453 3,939,881 577,555 1,155,684 726,458 148,410,668 $ 35,497,355 21,023,442 275,000 3,772 242,639 262,762 57,304,970 765 16,281,759 16,282,524 8,643,595 8,643,595 70,823,207 2,034,800 110,968 12,868 (34,421,220) 6,703,349 45,263,972 73,049 45,337,021 62,884,399 119,381,075 26,478 (49,743,518) 1,375,175 3,523,995 74,563,205 7,712 74,570,917 75,652,236 80,097,774 998,108,913 12,889,805 22,650,281 23,308,257 12,868 (515,022,261) 18,824,524 112,017,347 752,887,508 573,269 769,743,301 918,153,969 148,102 39,710,048 37,780,745 1,163,648 (66,085,402) 2,111,626 14,828,767 309,454 23,781,816 81,086,786 311,180 311,180 34,928 34,928 2,576,710 1,005,618 3,582,328 1,401,536 1,401,536 LIABILITIES Current liabilities: Accounts payable Accrued payroll Interest payable Due to other governments Customer deposits Other liabilities Current portion of claims payable Current portion of compensated absences Current portion of bonds & loans payable Current portion of lease payable Current portion of SBITA payable Unearned revenue-other Total current liabilities Non-current liabilities: Long-term portion of claims payable Long-term portion of compensated absences Long-term portion of bonds & loans payable Long-term portion of lease payable Long-term portion of SBITA payable Net pension and other postemployment benefits liablilities Total non-current liabilities Total liabilities 883,666 77,084 3,916 1,000 64,877 141,449 2,423 5,153 1,179,568 285,424 5,376 14,465 305,265 6,482,390 512,701 1,703,038 167,138 2,061,426 1,481,257 949,026 8,728,843 2,423 5,153 22,093,395 3,504,279 353,479 9,344 31 8,234,981 608,131 352,322 13,062,567 217,481 9,269 2,098,434 2,325,184 3,504,752 30,196 221,535 251,731 556,996 1,125,901 97,705,359 9,269 16,468,014 115,308,543 137,401,938 907,894 661,938 140,038 8,889,540 10,599,410 23,661,977 DEFERRED INFLOWS OF RESOURCES Deferred inflows related to pensions and other postemployment benefits Deferred inflows related to leases Total deferred inflows of resources 114,027 3,822,056 3,936,083 12,039 12,039 894,864 3,822,056 4,716,920 483,054 483,054 45,252,281 74,563,205 662,256,419 14,259,273 10,717,887 100,000 73,049 (388,473) $ 55,754,744 7,712 547,212 75,118,129 32,651,553 100,000 573,269 84,036,198 779,617,439 309,454 20,286,020 23,488,544 $ 58,343,291 NET POSITION Net investment in capital assets Restricted: Capital projects Facilities maintenance Trust purpose Net other postemployment benefits Unrestricted Total net position $ Adjustment to report the cumulative internal balance for the net effect of the activity between the internal service funds and the enterprise funds over time. $ The accompanying notes are an integral part of the financial statements 37 4,860,740 784,478,179 CITY OF PEORIA, ARIZONA STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET POSITION PROPRIETARY FUNDS FOR THE YEAR ENDED JUNE 30, 2023 Business-type Activities Major Enterprise Funds Water Utility Wastewater Solid Waste Fund Utility Fund Utility Fund OPERATING REVENUES Charges for services Rents Intergovernmental Miscellaneous Total operating revenues $ 51,671,336 280,000 2,320,754 54,272,090 $ 26,553,265 23,982 26,577,247 $ 17,162,418 18,097 17,180,515 7,421,352 37,576,469 14,557,947 59,555,768 (5,283,678) 3,729,650 13,703,292 11,910,410 29,343,352 (2,766,105) 5,635,415 11,014,532 1,445,991 18,095,938 (915,423) 1,431,364 (1,994,443) 13,550 (549,529) 1,135,435 (965,061) 170,374 164,753 (89,871) 74,882 (5,833,207) (2,595,731) (840,541) Capital contributions Transfers in Transfers out Change in net position 9,574,759 10,169,825 (1,398,724) 12,512,653 4,040,600 6,932,602 (5,379,915) 2,997,556 (840,541) Total net position - beginning Total net position - ending 326,054,716 $ 338,567,369 289,590,710 $ 292,588,266 18,429,472 $ 17,588,931 (continued) OPERATING EXPENSES Salaries, wages and employee benefits Contractual services, materials and supplies Insurance claims and expenses Depreciation and amortization Total operating expenses Operating income (loss) NON-OPERATING REVENUES (EXPENSES) Investment income(loss) Interest expense Gain (loss) on sale of capital assets Total non-operating revenues (expenses) Income (loss) before capital contributions and transfers The accompanying notes are an integral part of the financial statements 38 CITY OF PEORIA, ARIZONA STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET POSITION PROPRIETARY FUNDS FOR THE YEAR ENDED JUNE 30, 2023 Business-type Activities Major Enterprise Funds Stadium Storm Drain Fund Utility Fund OPERATING REVENUES Charges for services Rents Intergovernmental Miscellaneous Total operating revenues $ OPERATING EXPENSES Salaries, wages and employee benefits Contractual services, materials and supplies Insurance claims and expenses Depreciation and amortization Total operating expenses Operating income (loss) 1,695,475 3,434,491 3,821,270 8,951,236 $ 1,556,380 1,556,380 Total $ Governmental Activities Internal Service Funds 98,638,874 3,434,491 280,000 6,184,103 108,537,468 $ 59,647,214 541,673 60,188,887 2,811,293 4,462,682 2,363,345 9,637,320 (686,084) 204,320 1,438,362 2,964,158 4,606,840 (3,050,460) 19,802,030 68,195,337 33,241,851 121,239,218 (12,701,750) 10,466,827 19,302,437 27,429,874 4,666,193 61,865,331 (1,676,444) NON-OPERATING REVENUES (EXPENSES) Investment income(loss) Interest expense Gain (loss) on sale of capital assets Total non-operating revenues (expenses) Income (loss) before capital contributions and transfers 251,301 (243) 6,225 257,283 12,000 12,000 2,994,853 (2,959,747) (70,096) (34,990) 1,119,983 (13,901) 66,512 1,172,594 (428,801) (3,038,460) (12,736,740) (503,850) Capital contributions Transfers in Transfers out Change in net position 4,056,800 3,627,999 4,339,457 1,266,132 2,567,129 17,954,816 22,425,359 (6,778,639) 20,864,796 616,962 3,157,513 (22,493) 3,248,132 Total net position - beginning Total net position - ending 52,126,745 $ 55,754,744 72,551,000 $ 75,118,129 758,752,643 779,617,439 55,095,159 $ 58,343,291 Adjustment for the net effect of the current year activity between the internal service funds and the enterprise funds. Change in net position of business-type activities 207,302 $ 21,072,098 The accompanying notes are an integral part of the financial statements 39 CITY OF PEORIA, ARIZONA STATEMENT OF CASH FLOWS PROPRIETARY FUNDS FOR THE YEAR ENDED JUNE 30, 2023 Business-type Activities Major Enterprise Funds Water Utility Wastewater Solid Waste Fund Utility Fund Utility Fund CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers Payments to suppliers Payments to employees Self-insurance costs Payments to internal service funds Net cash provided (used) by operating activities $ 54,368,814 (36,092,629) (7,119,369) (3,393,186) 7,763,630 $ 26,543,329 (9,617,438) (3,738,444) (1,553,399) 11,634,048 CASH FLOWS FROM NON-CAPITAL FINANCING ACTIVITIES Transfers in Transfers out Interfund loans payable Net cash provided (used) by non-capital financing activities 10,169,825 (1,398,724) - 6,932,602 (5,379,915) - - 8,771,101 1,552,687 - CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Acquisition and construction of capital assets Proceeds from disposal of capital assets Capital contributions Principal payments on long-term liabilities Interest paid on long-term liabilities Net cash provided (used) by capital and related financing activities (17,278,471) 13,550 2,234,164 (5,272,953) (2,185,266) (15,609,964) 734,023 (2,546,729) (1,170,789) (1,280,950) 6,549 - (22,488,976) (18,593,459) (1,274,401) (12,097,318) 5,457,549 1,238,701 (5,401,068) (12,897,141) 3,255,151 974,023 (8,667,967) 149,898 149,898 (11,355,313) 79,037,725 $ 67,682,412 (14,074,691) 51,980,055 $ 37,905,364 (635,612) 10,384,588 $ 9,748,976 (continued) CASH FLOWS FROM INVESTING ACTIVITIES Purchase of investments Proceeds from sale of investments Interest received on investments Net cash provided (used) by investing activities Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year $ 16,907,080 (3,007,788) (5,532,387) (7,878,014) 488,891 The accompanying notes are an integral part of the financial statements 40 CITY OF PEORIA, ARIZONA STATEMENT OF CASH FLOWS PROPRIETARY FUNDS FOR THE YEAR ENDED JUNE 30, 2023 Business-type Activities Major Enterprise Funds Stadium Storm Drain Fund Utility Fund CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers Payments to suppliers Payments to employees Self-insurance costs Payments to internal service funds Net cash provided (used) by operating activities CASH FLOWS FROM NON-CAPITAL FINANCING ACTIVITIES Transfers in Transfers out Interfund loans payable Net cash provided (used) by non-capital financing activities CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Acquisition and construction of capital assets Proceeds from disposal of capital assets Capital contributions Principal payments on long-term liabilities Interest paid on long-term liabilities Net cash provided (used) by capital and related financing activities CASH FLOWS FROM INVESTING ACTIVITIES Purchase of investments Proceeds from sale of investments Interest received on investments Net cash provided (used) by investing activities Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year Total Governmental Activities Internal Service Funds $ 9,280,371 (3,014,457) (2,437,853) (603,666) 3,224,395 $ 1,552,641 (921,061) (272,033) (254,662) 104,885 $ 108,652,235 (52,653,373) (19,100,086) (13,682,927) 23,215,849 $ 60,230,821 (18,865,354) (10,376,856) (25,237,798) 5,750,813 4,056,800 - 1,266,132 (481,236) 22,425,359 (6,778,639) (481,236) 3,157,513 (22,493) - 4,056,800 784,896 15,165,484 3,135,020 (139,020) 6,225 (1,176) (243) (3,523,994) 3,523,994 - (37,832,399) 26,324 6,492,181 (7,820,858) (3,356,298) (2,873,570) 89,982 (671,576) (4,268) (134,214) - (42,491,050) (3,459,432) 214,222 214,222 10,667 10,667 (24,994,459) 8,712,700 2,587,511 (13,694,248) (3,503,810) 3,460,690 968,124 925,004 7,361,203 4,955,999 $ 12,317,202 900,448 900,448 (17,803,965) 146,358,367 $ 128,554,402 6,351,405 50,444,392 56,795,797 (continued) $ The accompanying notes are an integral part of the financial statements 41 $ CITY OF PEORIA, ARIZONA STATEMENT OF CASH FLOWS PROPRIETARY FUNDS FOR THE YEAR ENDED JUNE 30, 2023 Business-type Activities Major Enterprise Funds Water Utility Wastewater Solid Waste Fund Utility Fund Utility Fund Reconciliation of operating income (loss) to net cash provided (used) by operating activities Operating income (loss) $ (5,283,678) $ (2,766,105) 14,557,947 11,910,410 1,445,991 51,324 (432,819) (90,638) (32,793) (33,918) (12,665) (273,435) 359,190 (23,214) 303,167 176,722 226,180 (1,376,055) 91,053 (16,847) 7,013 45,400 90,697 1,355,416 1,897,873 10,385 634,582 25,701 578,074 (230,460) 15,118 20,498 970,097 (1,505,557) 13,047,308 (787,011) 14,400,153 (1,105,651) 1,404,314 $ 7,763,630 $ 11,634,048 $ 488,891 $ 7,340,595 $ $ - Adjustments to reconcile operating income (loss) to net cash provided by (used in) operating activities: Depreciation and amortization (Increase) decrease in assets/deferred outflows: Accounts receivable Leases receivable Prepaid items Supplies inventory Net other postemployment benefits asset Deferred outflows - pension and other postemployment benefits Increase (decrease) in liabilities/deferred inflows: Accounts payable Accrued payroll Due to other governments Other liabilities Deposits payable Claims payable Unearned revenue - other Compensated absences Net pension and other post employment benefit liability Deferred inflows - pension and other postemployment benefits Deferred inflows - leases Total adjustments Net cash provided (used) by operating activities Non-cash investing, capital and financing activities: Capital assets acquired through contributions from developers and City governmental funds Execution of agreements for right to use subscription assets Change in fair value of investments Total non-cash investing, capital and financing activities (2,185,616) $ 5,154,979 3,306,577 (1,404,861) $ 1,901,716 $ (915,423) (318,252) $ (318,252) (continued) The accompanying notes are an integral part of the financial statements 42 CITY OF PEORIA, ARIZONA STATEMENT OF CASH FLOWS PROPRIETARY FUNDS FOR THE YEAR ENDED JUNE 30, 2023 Business-type Activities Major Enterprise Funds Stadium Storm Drain Fund Utility Fund Total Governmental Activities Internal Service Funds Reconciliation of operating income (loss) to net cash provided (used) by operating activities Operating income (loss) $ Adjustments to reconcile operating income (loss) to net cash provided by (used in) operating activities: Depreciation and amortization (Increase) decrease in assets/deferred outflows: Accounts receivable Leases receivable Prepaid items Supplies inventory Net other postemployment benefits asset Deferred outflows - pension and other postemployment benefits Increase (decrease) in liabilities/deferred inflows: Accounts payable Accrued payroll Due to other governments Other liabilities Deposits payable Claims payable Unearned revenue - other Compensated absences Net pension and other post employment benefit liability Deferred inflows - pension and other postemployment benefits Deferred inflows - leases Total adjustments Net cash provided (used) by operating activities Non-cash investing, capital and financing activities: Capital assets acquired through contributions from developers and City governmental funds Execution of agreements for right to use subscription assets Change in fair value of investments Total non-cash investing, capital and financing activities (686,084) $ (3,050,460) $ (12,701,750) $ (1,676,444) 2,363,345 2,964,158 33,241,851 4,666,193 382,760 39,197 (18,435) (3,739) 1,500 122,992 39,197 (73,629) (90,638) (85,607) 41,934 59,608 (37,181) 67,228 28,896 802,193 484,994 776,566 35,619 3,116 64,877 4,103 62,430 649,516 262,639 (1,554) 4,821 (22,850) 1,330,563 150,621 (13,731) 706,472 45,400 4,103 204,147 3,530,253 377,475 143,707 31 2,192,076 26,209 1,666,063 (422,918) (96,925) 3,910,479 (78,526) 3,155,345 (3,899,663) (96,925) 35,917,599 (2,193,852) 7,427,257 $ 3,224,395 $ 104,885 $ 23,215,849 $ 5,750,813 $ - $ 815,462 $ 11,462,634 $ 616,962 $ - $ 815,462 (3,908,729) 7,553,905 $ The accompanying notes are an integral part of the financial statements 43 $ 307,293 23,934 948,189 (concluded) CITY OF PEORIA, ARIZONA STATEMENT OF FIDUCIARY NET POSITION JUNE 30, 2023 Custodial Funds ASSETS Pooled cash and investments Due from other governments Interest receivable Total assets $ 197,739 7,620 551 205,910 NET POSITION Restricted for: Individuals and organizations Other governments Total net position 153,142 52,768 $ 205,910 The accompanying notes are an integral part of the financial statements 44 CITY OF PEORIA, ARIZONA STATEMENT OF CHANGES IN FIDUCIARY NET POSITION FOR THE YEAR ENDED JUNE 30, 2023 Total Custodial Funds ADDITIONS Contributions: Individuals Intergovernmental Investment earnings: Interest Total additions $ 32,942 10,890 2,962 46,794 DEDUCTIONS Recipient payments Total deductions 24,251 24,251 Change in net position 22,543 Net position - beginning of the year Net position - end of the year 183,367 $ 205,910 The accompanying notes are an integral part of the financial statements 45 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 47 2 Deposits and Investments 58 3 Deficits in Fund Equity/Excess of Expenditures Over Appropriations 60 4 Accounts Receivable and Allowance for Doubtful Accounts 61 5 Due from Other Governments 61 6 Capital Assets 62 7 Long-term Debt 63 8 Risk Financing Activities 68 9 Leases 69 10 Subscription-Based Information Technology Arrangements 71 11 Pensions and Other Postemployment Benefits 71 12 Deferred Compensation Plan 83 13 Contingencies, Commitments and Other Claims 83 14 Interfund Transactions, Receivable and Payable Balances 84 15 Stabilization Arrangements 85 16 Segment Information for Enterprise Funds 85 46 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accompanying financial statements of the City of Peoria, Arizona (City) have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) applicable to governmental units adopted by the Governmental Accounting Standards Board (GASB). A summary of the City’s more significant policies follows. A. Financial Reporting Entity The City of Peoria was incorporated in 1954 under the Arizona Revised Statutes. The current City charter provides for the Council - Manager form of government and provides such services as authorized by the charter as limited by the constitution of the State of Arizona. The City's major operations include police protection and fire and medical services, parks and recreation, development services, public works, certain social services and general administrative services. In addition, the City owns and operates enterprise funds, which include water, wastewater, solid waste and storm drain operations, and a baseball stadium complex. The financial reporting entity presented in these financial statements consists of the City and its blended component units for which the City is financially accountable. The blended component units are, in substance, part of the primary government’s operations, even though they are legally separate entities. These component units are governed by boards, wholly or substantially, comprised of the government’s elected council. Individual Component Units - Blended City of Peoria Municipal Development Authority, Inc. City of Peoria Municipal Development Authority, Inc. (Authority), an Arizona not-for-profit corporation, was organized for the purpose of financing the construction of municipal facilities within the City through the issuance of bonds. Concurrent with these bond issues, the City entered into contracts with the Authority whereby the City will pay, to the Authority, amounts sufficient to retire the Authority's bonds and related interest. The outstanding Municipal Development Authority, Inc. bonds are reported as a debt service fund in the City’s financial statements. All of the outstanding debt of the Authority will be repaid by revenues of the City. No separate financial statements are prepared for the Municipal Development Authority, Inc. Vistancia Community Facilities District The Vistancia Community Facilities District (Vistancia) was formed by petition to the City Council in 2002. Vistancia’s purpose is to acquire or construct public infrastructure in a specified area of the City. As a special purpose district and separate political subdivision under the Arizona Constitution, Vistancia can levy taxes and issue bonds independently of the City. Property owned in the designated areas is assessed for Vistancia’s property taxes, and thus for the costs of operating the district. The City Council serves as the Board of Directors of Vistancia and City management has operational responsibility for Vistancia. The City has no liability for the district’s debt. For reporting purposes, the transactions of Vistancia are included as governmental funds as if they were part of the City’s operations. 47 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 Vistancia West Community Facilities District The Vistancia West Community Facilities District (Vistancia West) was formed by petition to the City Council in 2014. Vistancia West’s purpose is to acquire or construct public infrastructure in a specified area of the City. As a special purpose district and separate political subdivision under the Arizona Constitution, Vistancia West can levy taxes and issue bonds independently of the City. Property owned in the designated areas is assessed for Vistancia West’s property taxes, and thus for the costs of operating the district. The City Council serves as the Board of Directors of Vistancia West and City management has operational responsibility for Vistancia West. The City has no liability for the district’s debt. For reporting purposes, the transactions of Vistancia West are included as governmental funds as if they were part of the City’s operations. Mystic at Lake Pleasant Heights Community Facilities District The Mystic at Lake Pleasant Heights Community Facilities District (Mystic) was formed by petition to the City Council in 2020. Mystic’s purpose is to acquire or construct public infrastructure in a specified area of the City. As a special purpose district and separate political subdivision under the Arizona Constitution, Mystic can levy taxes and issue bonds independently of the City. Property owned in the designated areas is assessed for Mystic’s property taxes, and thus for the costs of operating the district. The City Council serves as the Board of Directors of Mystic and City management has operational responsibility for Mystic. The City has no liability for the district’s debt. For reporting purposes, the transactions of Mystic are included as governmental funds as if they were part of the City’s operations. Vistancia North Community Facilities District The Vistancia North Community Facilities District (Vistancia North) was formed by petition to the City Council in 2020. Vistancia North’s purpose is to acquire or construct public infrastructure in a specified area of the City. As a special purpose district and separate political subdivision under the Arizona Constitution, Vistancia North can levy taxes and issue bonds independently of the City. Property owned in the designated areas is assessed for Vistancia North’s property taxes, and thus for the costs of operating the district. The City Council serves as the Board of Directors of Vistancia North and City management has operational responsibility for Vistancia North. The City has no liability for the district’s debt. For reporting purposes, the transactions of Vistancia North are included as governmental funds as if they were part of the City’s operations. City of Peoria Employee Benefit Trust The City of Peoria Employee Benefit Trust (the Trust) was formed by petition to the City Council on January 1, 2010. The Trust’s purpose is to fund health, welfare and related benefit programs by the City in accordance with the provisions of Arizona law. Plan premiums are paid by Participants and the City. The City Council Sub Committee on Boards and Commissions nominate individuals to serve as Trustees overseeing the management and administration of the Trust. For financial reporting purposes, the transactions of the Trust are included as part of the Self-Insurance Fund, an internal service fund in the City’s financial statements. City of Peoria Workers’ Compensation Trust The City of Peoria Workers’ Compensation Trust (the Trust) was formed by petition to the City Council in 2009. The Trust’s purpose is to fund workers’ compensation benefit programs by the City in accordance with the provisions of Arizona law. Plan premiums are paid by the City. The City Council Sub Committee on Boards and Commissions nominate individuals to serve as Trustees overseeing the management and administration of the Trust. For financial reporting purposes, the transactions of the Trust are included as part of the Self-Insurance Fund, an internal service fund in the City’s financial statements. Stand-alone financial statements are prepared for Vistancia, Vistancia West, Vistancia North, Mystic and the two trusts above. The accounting records of these are maintained by the City and the financial 48 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 statements are available by contacting the City’s Finance Department, 8401 West Monroe Street, Peoria, AZ 85345. B. Basis of Presentation – Government-wide and Fund Financial Statements The government-wide financial statements (i.e. the statement of net position and the statement of activities) report financial information on all of the non-fiduciary activities of the primary government and its component units. Governmental activities which are normally supported by taxes and intergovernmental revenues are reported separately from business-type activities, which rely to a significant extent on fees and charges for support. The statement of activities demonstrates the degree to which the direct expenses for a given function or segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operation or capital requirements of a particular function or segment. Taxes and other items not included among program revenues are reported instead as general revenues. The City does not currently employ an indirect cost allocation system. The General Fund and certain other funds charge administrative service fees to other operating funds to support general services used by the other operating funds (like purchasing, accounting and administration). These administrative fees are eliminated from the financial statements at both the government-wide and fund level like a reimbursement, by reducing revenues and expenditures/expenses in the allocating fund. Separate financial statements are provided for governmental funds (general fund, special revenue funds, debt service funds and capital projects funds), proprietary funds, and fiduciary funds, even though the latter are excluded from the government-wide financial statements. Major individual funds and major individual enterprise funds are reported as separate columns in the fund financial statements. The City reports the following major governmental funds: The General Fund is the City’s primary operating fund and is used to account for and report all financial resources not accounted for and reported in another fund. The Highway User Revenue Fund, a special revenue fund, is required by state statute to track receipts of specific state shared revenues and the expenditure of those funds. The Transportation Sales Tax Fund, a special revenue fund, accounts for the revenues generated from a sales tax increase designated by public vote for use in funding transportation needs throughout the City. The GO Bond Debt Service Fund accounts for the principal and interest requirements of the City’s general obligation bonds, with revenues generated from the general property tax levy sufficient to meet the debt service. The Development Fee Fund, a capital projects fund, accounts for the receipt and expenditure of development impact or expansion fees for all governmental activities as governed by state statutes. The Non-Bond Capital Projects Fund accounts for the purchase or construction of capital assets with funds other than bond proceeds. This includes monies received from outside sources, i.e. developers or other governments, and also City pay-as-you-go monies. 49 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 The City reports the following major proprietary funds: The Water Utility, Wastewater Utility, Solid Waste Utility and Storm Drain Utility Funds all account for the revenues from charges to the customers of these services and the costs of these services. The Stadium Fund accounts for the revenues generated by and the costs of operation of a sports complex owned by the City. This facility is used for spring training by two major league baseball teams as well as multiple other uses throughout the year. Additionally, the City reports the following fund types: The Internal Service Funds account for (1) Motor Pool, (2) Facilities Maintenance, (3) Self-Insurance which includes workers’ compensation and health insurance programs, and (4) Information Technology which includes a computer replacement program. The Fiduciary Funds are custodial funds and do not involve measurement of operations. The City currently maintains 2 fiduciary funds. One fund, PLAY Peoria, accounts for monies held on behalf of separate notfor-profit agencies for which the City operates as an administrator. Another fund accounts for monies held on behalf of Westside Fire Training IGA, a consortium of area fire departments that pool monies for training activities, for which the City acts as the administrator. For the most part, the effect of the interfund activity has been removed from these statements. Quasiexternal transactions, like the sale of utility services from the Enterprise Funds to the other funds, are not eliminated for the financial statements as elimination of these charges would distort the direct costs and program revenue reported for the various functions. Proprietary funds distinguish operating revenues and expenses from nonoperating 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 and internal service funds are charges for customer services including: water, sewer, solid waste, storm drain, vehicle purchase/maintenance, computer replacement and risk management charges. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. When both restricted and unrestricted resources are available for specified expenditures, generally, the City would first apply restricted resources when an expense is incurred. C. Measurement Focus and Basis of Accounting The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund and fiduciary 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 revenue as soon as all eligibility requirements imposed by the provider have been met. Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are earned and available to pay liabilities of the current period (generally these revenues are earned by June 30 and are expected to be collected within six months after year-end, except for property taxes). For property taxes, the City uses a 60 day collection period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting, except expenditures related to debt service, compensated absences and claims and judgments, which are recorded only when payment is due. Entitlements, other taxes and shared revenues are all considered to be susceptible to accrual and revenue recognition in the current fiscal period. Expenditure-driven grants are recognized as revenue when the qualifying expenditures have been incurred and all other grant requirements have been met. For the 50 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 governmental fund statements, grant revenue earned but not expected to be received within six months of year end is a deferred inflow of resources. Changes in fair value of investments are recognized in investment income at the end of the year. All other revenue items are considered to be measurable and available only when the City receives cash. Because different measurement focuses and basis of accounting are used in the government-wide statement of net position and in governmental fund balance sheets, amounts reported as restricted fund balances in governmental funds may be different from amounts reported as restricted net position in the statement of net position. D. Budgets and Budgetary Accounting The City prepares its annual budget on a basis consistent with generally accepted accounting principles with such exceptions as eliminating compensated absences. The City uses the following procedures in establishing the budgetary data reflected in the accompanying financial statements: • 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. Public meetings are held to obtain citizen comment. • Prior to June 30, the City Council legally enacts the budget, through the passage of a resolution. The resolution 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. • The maximum legal expenditure permitted for the year is the total budget as adopted. The expenditure appropriations in the adopted budget are maintained in the City’s financial system by department within individual funds. Departmental appropriations may be amended during the year, within administrative guidelines and adopted Council policies. • The initial budget for the fiscal year may be amended during the year in a legally permissible manner. • The City Manager is generally authorized to transfer budgeted amounts within any specific fund’s expenditure appropriation. Any budget revisions requiring a transfer between funds must be approved by the City Council. Additionally, budget revisions involving the use of contingency budgets must be approved by the City Council. • 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 staff. Budgetary carry forwards are approved by the City Council. • All funds of the City, except the fiduciary funds, have legally adopted budgets. Formal integration of these budgets into the City’s financial systems is employed as a management control device during the year for all funds. 51 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 E. Assets, Liabilities, Deferred Outflows/Inflows of Resources, and Net Position/Fund Balance I. Deposits and Investments Cash Equivalents 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. Investments The City’s funds are invested in accordance with the City’s investment policy and Arizona Revised Statutes. The City's policy is to invest in obligations of the U.S. Government or any of its agencies and instrumentalities, certificates of deposit, bankers’ acceptances, commercial paper, money market funds, repurchase agreements, corporate securities, the State of Arizona local government investment pool and State of Arizona debt including counties, incorporated cities, towns or duly organized school districts. Funds held by trustees related to the issuance of bonds and certain loan programs are invested in accordance with contractual agreements and trust documents. The City generally reports investments at fair value in the balance sheet and recognizes the corresponding change in the fair value of investments in the year in which the change occurred. The fair value of participants’ position in the Local Government Investment Pool approximates the value of the pool shares. Other non-pooled investments are also generally carried at fair value. The fair value of non-pooled investments is determined annually and is based on current market prices. The fair value of investments in open-end mutual funds is determined based on the funds’ current share price. Except for certain specific investments, generally those held in trust for a specific purpose, the City maintains pooled cash and investments, and allocates interest income based on a fund’s proportionate cash balance. Investment income related to certain special revenue funds is allocated to the General Fund. Non-pooled investment income is recorded in the fund that held the specific investments. II. Receivables All receivables are shown net of an allowance for uncollectible accounts. For trade accounts receivable (miscellaneous receivables and utility billing receivables), amounts outstanding in excess of 90 days are included in the allowance. Lease receivables are calculated as the net present value of future lease payments for the term of the lease as defined by GASB Statement #87. III. Inventory and Prepaid Items Inventories are valued at cost and the City uses the first-in, first-out (FIFO) flow assumption in determining cost and consist of expendable supplies. The cost of such inventories is recorded as expenditures/expenses when consumed rather than when purchased. Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both government-wide and fund financial statements. IV. Restricted Assets Certain proceeds of the City’s bonds, as well as certain resources set aside for their repayment, are classified as restricted on the balance sheet, or statement of net position, because they are maintained in separate bank accounts and their use is limited by applicable debt covenants. 52 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 V. Capital Assets Capital assets, which include property, plant, equipment, right of use leased assets, 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 more than $100,000 for Buildings and Improvements, Water and Sewer Systems, Storm Drainage Systems and Infrastructure systems (streets, etc.) and $25,000 for all other asset categories (except land) and an estimated useful life of greater than one year. Capital assets are recorded at the cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at acquisition value at the date of donation. The cost of normal maintenance and repairs that do not add to the value of the asset or materially extend assets lives are not capitalized. Major improvements are capitalized and depreciated over the remaining useful lives of the related capital assets. Property, plant and equipment is depreciated using the straight-line method over the following estimated useful lives: Assets Water rights Buildings and improvements Water and sewer systems Storm drainage systems Park facilities and landscape Street system Streetlights and traffic control devices Equipment, furniture and fixtures Vehicles Computers/software Right to use Lease Assets Right to use SBITA Useful life (Years) 50 20-40 5-40 40 40 20 10 7 3-15 3 5 2-7 Capital assets transferred between funds are transferred at their net book value (cost less accumulated depreciation) or net realizable value, if lower, as of the date of the transfer. VI. Compensated Absences The liability for compensated absences reported in the government-wide and proprietary statements consists of unpaid, accumulated leave balances. Annual leave, based on a graduated scale of years of employment, is credited to each employee as it accrues. The maximum annual leave accrual for permanent employees is 360 hours while Fire department employees accrue at a maximum rate of 544 hours. Upon employment termination, payment is made to the employee for the unused leave. City employees are granted 8 hours of sick leave per month. The maximum an employee may accumulate varies according to union status. Upon resignation, employees who have at least five years of employment with the City and accumulated 200 hours or more of sick leave are entitled to a 50% payout. Additionally upon retirement, employees who have accumulated 200 hours or more of sick leave are entitled to a 50% payout. Any sick time accrued above the maximum allowed to be carried is paid out annually in December or May at a rate of 25%, or 50%, according to union or employment status, and the corresponding employees’ sick leave is reduced to the allowable maximum. For the governmental fund financial statements, compensated absences are accrued only when due. For the government-wide financial statements, as well as the proprietary fund financial statements, all of the outstanding vacation, compensatory time and benefits, as well as an estimate of the retirement sick-time payout for eligible employees, are recorded as a liability. Compensated absences are liquidated when mature by the various operating funds. 53 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 VII. Long-Term Obligations In the government-wide financial statements, and proprietary fund types in the fund financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities, or proprietary fund type statement of net position. Bond premiums and discounts are amortized over the life of the bonds using the effective interest method. Bonds payable are reported net of the applicable bond premium or discount. In the fund financial statements, governmental fund types recognize bond premiums and discounts in the period in which the bonds are issued. 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. The long-term debt of the City is serviced by various debt service funds, according to the type of debt and the funds benefiting from that debt. VIII. 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 assets that applies to a future periods(s) and so will not be recognized as an outflow of resources (expense/expenditure) until that time. The City reports deferred outflows related to pensions and other postemployment benefits (OPEB), deferred outflows related to bond refunding and excess consideration provided for acquisitions. In addition to liabilities, the statement of net position and the balance sheet of governmental funds 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 assets that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time. The City reports deferred inflows related to pensions and OPEB in the statement of net position, unavailable revenue reported from property taxes and grant or intergovernmental revenues in the balance sheet of governmental funds, and deferred inflows from leases in both reports. IX. Pension and Other Postemployment Benefits For purposes of measuring the net pension and other postemployment benefits (OPEB) assets and liabilities, deferred outflows of resources and deferred inflows of resources related to pensions and OPEB, and pension and OPEB expense, information about the plans’ fiduciary net position and additions to or deductions from the plans’ fiduciary net position have been determined on the same basis as they are reported by the plans. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. X. Net Position In the government-wide and proprietary fund financial statements, net position is reported in three categories: net investment in capital assets, restricted, and unrestricted. The net investment in capital assets balances are separately reported because capital assets make up a significant portion of net position. Restricted balances account for the portion of net position restricted by external resource providers or through enabling legislation. Unrestricted balances are the remaining balances not included in the previous two categories. 54 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 XI. Fund Balance policies In the fund financial statements, governmental funds distinguish between nonspendable and spendable fund balances. Nonspendable balances include amounts that cannot be spent because they are not in a spendable form, such as inventory or prepaid items, or because resources legally or contractually must remain intact. Spendable balances are further classified as restricted, committed, assigned and unassigned based on the relative strength of the constraints that control how specific amounts can be spent. Restricted fund balances include amounts that can be spent only for the specific purposes stipulated by external resource providers (creditors, grantors, etc.) or through enabling legislation. Committed fund balances includes amounts that can be used only for the specific purposes determined by a formal action of the government’s highest level of decision-making authority. Such commitments are created by legislative action of the City Council, the City’s highest level of decision making authority, by resolution or ordinance and would require the same legislative action to reverse. Ordinances and resolutions both require public votes of the Council and, although the uses may differ, they are both considered to be of the highest level of decision making authority for the City. Commitment must be made or removed prior to June 30 in order to be reported in or removed from the financial statements. Much of the authority to commit fund balance is established in the City’s Council adopted Principals of Sound Financial Management. Amounts in the assigned fund balance classification are intended to be used by the City for specific purposes but do not meet the criteria to be classified as restricted or committed. The authority to make assignments has been delegated by the City Council to the Chief Financial Officer. Unassigned fund balances represent the residual net resources in excess of the other classifications. The General Fund is the only fund that can report a positive unassigned fund balance and any governmental fund can report a negative unassigned fund balance. As previously noted above, generally, the City would first apply restricted resources when an expense is incurred for purposes for which both restricted and unrestricted net position are available. The order in which the City would apply resources when multiple categories of unrestricted fund balance are available is as follows: committed, assigned and unassigned. XII. Interfund Transactions Interfund transactions, consisting of services performed for other funds or costs billed to other funds are treated as expenditures in the fund receiving the services and as a reimbursement reducing expenditures in the fund performing the services, except for utility services provided to other City departments, which are recorded as revenue in the Utility Enterprise funds. In addition, transfers are made between funds to shift resources from a fund legally authorized to receive revenue to a fund authorized to expend the revenue. XII. Stabilization arrangements The City has set aside funds for various stabilization arrangements. It is the City’s intent that situations allowing for the use of stabilization resources will be for non-routine situations. The authority for the stabilization arrangements is in the Council adopted Principles of Sound Financial Management. The governmental fund stabilization arrangements are shown as committed fund balance on the governmental fund financial statements. The City has the following stabilization arrangements at June 30, 2023:  Budget stabilization reserve – Maintained in the General Fund (10% of the average general fund revenues for the preceding five years) and the Half-Cent Sales Tax Fund (35% of the average fund revenues for the preceding five years). These reserves may be used to provide funding to deal with fluctuations in fiscal cycles and operating requirements that exceed $500,000. Any use of these reserves must be formally approved by the City Council and include a repayment plan to restore the reserve within the three fiscal years following the year in which the event occurred. Funding in excess of the stabilization reserve may be assigned by management for other purposes as approved by City 55 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 Council, including debt service, capital, economic development, community promotions or other specific city operational expenditures.  Emergency reserve – Maintained in the General Fund (10% of the average general fund revenues for the preceding five years) and is for unexpected, large-scale events where damage in excess of $250,000 is incurred and immediate remedial action must be taken to protect the health and safety of residents (e.g. floods, fires, storm damage). Usage of the emergency reserve must be approved by City Council, but the City Manager may utilize these funds when immediate action must be taken to protect the health and safety of residents. The City Manager must then provide a summary report to the City Council as soon as practical on the usage of these funds. The City shall strive to restore the Emergency Reserve to the 10% level within the next fiscal year following the fiscal year in which the event occurred.  Operating Reserve - Maintained in the General Fund (15% of the average general fund revenues for the preceding five years) and is for unexpected events whose impact exceeds $500,000, such as failure of the State to remit shared revenues, unexpected mandates, unexpected loss of State Shared revenues, continuance of critical city services due to unanticipated events, or to offset unexpected loss of a significant funding source for the remainder of the fiscal year. Any use of these reserves must be formally approved by the City Council and include a repayment plan to restore the reserve within the two fiscal years following the year in which the event occurred.  Enterprise Operating Fund Working Capital Reserve – Maintained in the Water Utility Fund (25% of the operating expenses of the fund for the fiscal year), the Wastewater Utility Fund (25% of the operating expenses of the fund for the fiscal year), and the Solid Waste Utility Fund (20% of the operating expenses of the fund for the fiscal year). These reserves are to provide the City with a comfortable margin of safety to address emergencies and unexpected declines in revenue without borrowing.  Rate Stabilization Reserve – In the Water and Wastewater Utility Funds (5% of the average fund revenues for the preceding three fiscal years). These funds may be used to moderate significant rate increases. In the event these funds are used, the City shall strive to restore the reserve to the 5% level within the next three fiscal years following the year in which the funds were used.  Debt Stabilization Reserve – In the Water and Wastewater Utility Funds (50% of the maximum annual debt service payment of the fund in the next five fiscal years) and the Half-Cent Sales Tax fund ($1,000,000). The Debt Stabilization Reserve is intended to provide additional security to insure the City’s ability to meet debt service obligations. In the event the Debt Stabilization Reserve is used, the City shall strive to restore the fund to the defined level within the three fiscal years following the year in which the funds were used.  Asset Maintenance Reserve - In the Water and Wastewater Utility Funds (2% of the enterprise fund infrastructure assets). The Asset Maintenance Reserve may be used to provide funding for the repair and maintenance of critical enterprise infrastructure. In the event the Asset Maintenance Reserve is used, the City shall strive to restore the fund to the defined level within the three fiscal years following the year in which the funds were used.  Capital Equipment Replacement Reserves – The City maintains various capital equipment replacement reserves to fund future replacement of certain capital equipment, primarily vehicles and computers. The annual internal charges to the operating funds are determined as part of the annual budget process. F. Property taxes The City Council adopts the annual tax levy each year on or before the third Monday in August as determined by the Maricopa County Assessor. For locally assessed property, the value is determined as of January 1 of the preceding year, known as the valuation year. For utilities and other centrally valued properties, the value is determined as of January 1 of the tax year. The City has an enforceable claim on the property when the property tax is levied. Levies are due and payable in two installments, on October 1 and March 1, and become delinquent on November 1 and May 1, respectively. Delinquent amounts bear 56 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 interest at the rate of 16 percent. A lien is placed on the property at the time the tax bill is sold. Maricopa County, at no charge to the taxing entities, bills and collects all property taxes. Public auctions for sale of delinquent real estate taxes are held in February following the May 1 date upon which the second half taxes become delinquent. G. Tax Abatements The City previously entered into tax abatement agreements as defined by GASB Statement 77. The tax abatements agreements from prior fiscal years have expired. It is the City’s policy to review each agreement individually and in the aggregate annually. For the fiscal year ended June 30, 2023, no tax abatement agreements were noted that were applicable to fiscal year 2023. H. Joint Ventures The City participates in the Regional Wireless Cooperative (RWC), an association of municipalities formed in 2008 to oversee the administration, operation, management, and maintenance of an expanding regional communications network. The RWC was formed through a governance structure founded on the principles of cooperation for the mutual benefit of all members and has expanded to serve a still-growing list of cities, towns, and fire districts, along with many other area entities who serve public safety needs. A regional radio communications network was built to seamlessly serve the interoperable communication needs of first responders and other municipal radio users in and around the Phoenix Metropolitan Region. Financial responsibilities are shared by all members based on their relative size and is measured by the number of subscriber units (radios) on the network. The City records its share of contributions to the RWC, third party contributions paid to the RWC for the benefit of the City, and equity in the joint venture in the City’s governmentwide financial statements. The City’s equity balance as of June 30, 2023 was $1,652,072. The RWC Annual Comprehensive Financial Statement is available from the Regional Wireless Cooperative, 200 West Washington Street, 12th Floor, Phoenix, Arizona, 85003-1611. I. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the statement of net position/balance sheet and the reported amounts of revenues and expenses/expenditures during the reporting period. Actual results could differ from those estimates. J. New Accounting Principles For the year ended June 30 2023, the City implemented the provisions of the following GASB Statements:   GASB Statement No. 94, Public-Private and Public-Public Partnerships and Availability payment Arrangements. The principal objective of GASB Statement No. 94 is to improve financial reporting by addressing issues related to public-private and public-public partnership arrangements. The City does not have any Public-Private or Public-Public Partnerships that meet the criteria for GASB Statement No. 94 so this statement has no impact on the financial statements. GASB Statement No. 96, Subscription-Based Information Technology Arrangements. The principal objective of GASB Statement No. 96 is to better meet the information needs of financial statement users by improving accounting and financial reporting for subscription-based information technology arrangements by governments. The Statement requires recognition of certain intangible assets and liabilities for subscription payments that previously were treated as operating expenses. The City has fifteen agreements that were impacted by this Statement. 57 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 GASB has issued the following pronouncements that may effect future financial position, results of operations, cash flows, or financial presentation of the City upon implementation. The City has not fully determined the effect these pronouncements will have on the City’s financial statements. GASB Statement No. 100 101 GASB Accounting Standards Accounting Changes and Error Corrections Compensated Absences Effective Dates The requirements of this Statement will take effect for financial statements starting with the fiscal year that ends June 30, 2025. The requirements of this Statement will take effect for financial statements starting with the fiscal year that ends June 30, 2025. 2. DEPOSITS AND INVESTMENTS A. Deposits The City maintains a cash and investment pool that is available for use by all funds. Certain restricted funds are not part of the City’s pool, but rather are maintained with trustees as required by contractual commitments. At June 30, 2023, the carrying amount of the City's deposits was $67,119,816 and the bank balance was $67,348,559. The entire bank balance was covered by federal depository insurance or collateralized by the City’s agent in the City’s name or in the Municipal Development Authority, Inc.'s name. The difference between the City’s carrying amount and the bank balance of $228,743 represents deposits in transit, outstanding checks and other reconciling items. The City maintains cash on hand balances in the form of petty cash and change funds. At June 30, 2023, the total amount of these balances was $7,400. B. Investments The City invests in obligations that fall within the authorization of State of Arizona laws, the City’s regulations and investment policy and applicable legal and contractual commitments. Interest rate risk: In order to limit interest and market rate risk, State law and the City’s investment policy sets a maximum maturity on any investment of five years with a minimum of 20% invested for a period of one year or less. At June 30, 2023, 48.6% of the City’s investments have a maturity of less than one year. Credit risk: State law and the City’s investment policy limits the purchase of Commercial Paper to prime quality securities rated within the top two ratings by a nationally recognized statistical rating organization. The City’s investment policy limits the purchase of Corporate Bonds or Notes to those securities rated at least A-/A3 or equivalent at the time of purchase by a nationally recognized statistical rating organization and with a maximum maturity of three years. The City’s investment policy also limits the purchase of Banker’s Acceptances to those securities rated Aa or better at the time of purchase by two nationally recognized statistical rating organizations and with a maximum maturity of 180 days. At June 30, 2023, the City’s investments include $30.2 million in Commercial Paper and $107.7 million in Corporate Notes. State law and the City’s investment policy also restricts investments in certificates of deposit (CD) to fully collateralized or insured from eligible Arizona depositories limited on a statewide basis by their capital structure on a quarterly basis. Such CDs are further collateralized to 110% with pledged securities held by an independent custodian approved by the City. City policy requires that securities underlying repurchase 58 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 agreements must have a collateralization level of at least 102 percent of the market value of principal and accrued interest. Investment Type Agency coupon securities Commercial Paper Corporate Bonds Asset Backed Securities Supra National Agency Bond S&P Ratings range A-1+ to AA+ A-1 to A-1+ BBB+ to AA+ AAA AAA The City’s investment in the State of Arizona local government investment pool is limited to a pool (Pool 7) that invests only in government securities. Pool 7 is not rated. Concentration of credit risk: The City’s investment policy sets diversification limits on both security types and length of maturity. As of June 30, 2023, the City’s investments include 50.3% in U.S. Treasury Notes, 20.0% in Corporate securities, 8.4% in Money Market investments, 7.9% in U.S. Agency Coupon securities, 5.6% in Commercial Paper, 5.2% in the State of Arizona local government investment pool, and 2.7% in Asset Backed Securities. There were no investments in any one issuer, excluding U.S. governments that represent 5% or more of total City investments. 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 safekeeping statements. 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. Investments classified as Level 2 inputs are valued using a matrix pricing model. The City has the following recurring fair value measurements as of June 30, 2023:      All U.S. Treasury securities are valued using quoted prices in active markets (Level 1) All agency coupon securities are valued using other observable inputs (Level 2) All commercial paper is valued using other observable inputs (Level 2) All corporate bonds are valued using other observable inputs (Level 2) All asset backed securities are valued using other observable inputs (Level 2) The City's cash and investments are combined with the State's pooled investments, and therefore, do not represent specific identifiable investments. The State categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting principles as described above. The City's investment in the State of Arizona's local government investment pool and the money market funds are stated at fair value, which also approximates the value of the investment upon withdrawal. 59 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 At June 30, 2023, the City’s total investments of $538,828,804 included the following: Investment Maturities in Years Less than 1 1-2 2-3 Over 3 Fair Value Investments: U.S Treasury notes $ 96,779,316 $ 113,572,976 $ 30,520,398 $ 29,917,360 $ 270,790,050 Agency coupon securities 42,414,622 - - - 42,414,622 Commercial paper 30,175,283 - - - 30,175,283 Corporate notes 19,566,790 Asset Backed Securities 31,813,987 - 10,634,780 - 45,704,196 107,719,753 14,596,406 14,596,406 Mutual fund-money market 45,221,147 - - - 45,221,147 State of Arizona LGIP 27,911,543 - - - 27,911,543 Total Investments $ 262,068,701 $ 145,386,963 $ 41,155,178 $ 90,217,962 $ 538,828,804 3. DEFICITS IN FUND EQUITY/EXCESS OF EXPENDITURES OVER APPROPRIATIONS At June 30, 2023, the following funds reported a deficit in fund balance/net position.   Non-Major Governmental Fund: Non-Bond Debt Service Fund Internal Service Fund: Facilities Maintenance Fund The Non-Bond Debt Service Fund deficit resulted from the timing of debt service transfers into the fund and the debt service payments being made out of the fund. The Facilities Maintenance Fund deficit resulted from the implementation of accounting guidance related to reporting for pensions and OPEB which requires liabilities to be presented on the face of financial statements. For the year ended June 30, 2023, expenditures, including capital outlay and transfers, did not exceed budget at the fund level (i.e. the level of budgetary control) in any funds. 60 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 4. ACCOUNTS RECEIVABLE AND ALLOWANCE FOR DOUBTFUL ACCOUNTS Accounts receivable are recorded in the various funds and displayed in the financial statements net of an allowance for uncollectible accounts as follows at June 30, 2023. Fund Governmental activities: General Fund Receivables $ 18,824,383 Allowance $ 3,240,391 Net $ 15,583,992 Highway User Revenue Fund 594,347 - 594,347 Transportation Sales Tax Fund 2,458,658 - 2,458,658 GO Bond Debt Service Fund 347,809 347,809 - Other Governmental Funds 610,344 55,987 554,357 Total governmental funds Internal Service Funds $ 22,835,541 $ 3,644,187 $ 19,191,354 $ 3,772 $ - $ 3,772 $ 7,265,235 $ $ 6,964,025 Business-type activities: Water Utility Fund 301,210 Wastewater Utility Fund 3,190,654 208,854 2,981,800 Solid Waste Utility Fund 2,237,975 132,410 2,105,565 Stadium Fund 1,227,426 - 1,227,426 Storm Drain Utility Fund 195,603 16,966 178,637 Total enterprise funds 14,116,893 659,440 13,457,453 Grand totals $ 36,956,206 $ 4,303,627 $ 32,652,579 5. DUE FROM OTHER GOVERNMENTS The City has due from other government receivables from various governments, including the Federal, State and County government. At June 30, 2023, significant receivables due to the City included $1,132,804 from the State of Arizona for State Shared Sales Tax revenues recorded in the General fund, $1,463,413 Highway User Revenue Fees revenues recorded in the Highway User Revenue Fund, $411,739 in federal funds from ADOT for reimbursement on a joint agency agreement, and $369,228 from the federal government for community development block grants. Most other receivables are comprised of taxes or various grants due from other governments and agencies. 61 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 6. CAPITAL ASSETS A summary of capital asset activity, for the government-wide financial statements, for the year ended June 30, 2023, follows: Balances** June 30, 2022 Governmental Activities: Non-Depreciable Assets: Work in Progress Land Total Non-Depreciable Assets $ Additions/ Transfers In Disposals/ Transfers Out Balances June 30, 2023 24,857,538 $ 425,218,402 450,075,940 20,068,842 $ 12,822,609 32,891,451 (13,067,509) $ (13,067,509) 31,858,871 438,041,011 469,899,882 198,111,113 60,314,988 37,978,498 870,644,946 143,905,022 41,774 9,858 2,927,217 5,098 112,931 1,720,223 19,737,859 372,373 (1,211,790) (235,892,928) - 198,116,211 60,427,919 38,486,931 654,489,877 143,905,022 41,774 9,858 3,299,590 1,313,933,416 21,948,484 (237,104,718) 1,098,777,182 (96,115,254) (56,734,434) (23,911,071) (601,794,887) (42,739,099) (5,061,285) (1,635,569) (3,426,585) (28,153,952) (3,727,022) 1,188,320 235,892,928 - (101,176,539) (58,370,003) (26,149,336) (394,055,911) (46,466,121) (19,685) - (17,084) (1,123,866) Total Accum. Depreciation/Amortization (821,314,430) (43,145,363) 237,081,248 (627,378,545) Total Depreciable Assets, Net 492,618,986 (21,196,879) (23,470) 471,398,637 $ 942,694,926 $ 11,694,572 $ (13,090,979) $ 941,298,519 $ 81,143,038 $ 18,824,524 37,867,433 $ - (6,993,124) $ - 112,017,347 18,824,524 Total Non-Depreciable Assets 99,967,562 37,867,433 (6,993,124) 130,841,871 Depreciable assets: Buildings & Improvements Equipment; Furniture Vehicles Surface Water System Water Rights Water System Wastewater System Lease Equipment; Furniture 80,097,774 22,275,571 22,036,549 118,565,613 12,889,805 448,791,114 430,780,581 - 374,710 1,726,356 815,462 11,269,952 3,306,577 12,868 (454,648) (12,200,860) (3,219,526) - 80,097,774 22,650,281 23,308,257 119,381,075 12,889,805 447,860,206 430,867,632 12,868 Total Depreciable Assets at Historical Cost 1,135,437,007 17,505,925 (15,875,034) 1,137,067,898 Less Accum. Depreciation: Buildings & Improvements Equipment; Furniture Vehicles Surface Water System Water Rights* Water System Wastewater System (34,378,396) (19,476,977) (9,492,029) (46,779,360) (3,866,941) (202,139,860) (181,657,526) (2,313,000) (1,112,361) (1,763,922) (2,964,158) (257,796) (13,018,045) (11,579,217) 358,228 12,200,860 3,219,526 (36,691,396) (20,589,338) (10,897,723) (49,743,518) (4,124,737) (202,957,045) (190,017,217) Less Accumulated Amortization: Lease Assets Total Accum. Depreciation (497,791,089) (1,287) (33,009,786) 15,778,614 (1,287) (515,022,261) 637,645,918 (15,503,861) (96,420) 622,045,637 737,613,480 $ 22,363,572 $ (7,089,544) $ 752,887,508 Depreciable and Amortizable Assets: Buildings & Improvements Equipment; Furniture Vehicles Street System Park System Lease Equipment; Furniture Lease Vehicle Intangible Asset-SBITA Total Depreciable and Amortizable Assets at Historical Cost Less Accum. Depreciation: Buildings & Improvements Equipment; Furniture Vehicles Street System Park System Less Accum. Amortization: Lease Assets Intangible Asset-SBITA Business-type Activities: Non-Depreciable Assets: Work in Progress Land Total Depreciable Assets, Net Business-Type Activities Capital Assets, Net $ - *The City’s agreement with the Gila River Indian Community provides water rights to 7,000 acre-feet of water each year through 2057. ** Revised due to the implementation of GASB 96 62 (36,769) (1,123,866) CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 Depreciation and amortization expense was charged to governmental and business-type functions in the government-wide financial statements as follows: Governmental activities: General government Culture and recreation Public Safety Development services Highway and streets Public works Human services Total Depreciation and amortization expense Business-type activities: 3,968,424 7,034,675 3,775,744 198,903 27,472,882 658,882 35,853 Water utility * Wastewater utility Storm drain utility Stadium Solid Waste 14,325,882 11,910,410 2,964,158 2,363,345 1,445,991 43,145,363 Total Depreciation expense 33,009,786 * Excludes amoritization of goodw ill of $232,065. 7. LONG-TERM DEBT A. General obligation bonds General: General obligation (GO) bonds are issued, after approval of the City of Peoria voters at an authorized bond election, to finance the purchase or construction of major capital facilities. GO bonds are backed by the “full faith and credit” of the City and are repaid through the City’s levying of property (ad valorem) taxes. There is no legal limit on the secondary property tax used for debt service on GO bonds. Statutory Debt Limitation: Under the provisions of the Arizona Constitution, outstanding general obligation bonded debt for combined water, sewer, light, (after January 1, 1974) parks and open space, and (after December 7, 2006) public safety and transportation purposes may not exceed 20 percent of a City's net limited assessed valuation. Also, outstanding general obligation bonded debt for all other purposes may not exceed 6 percent of a City's net limited assessed valuation. B. Revenue bonds Water and Sewer Revenue Bonds: Water and Wastewater Revenue Bonds are issued for the construction, acquisition, and equipping of water and wastewater facilities and related systems and infrastructure. The bonds are backed by the revenues of the water and wastewater utilities. C. Municipal Development Authority debt obligations Municipal Development Authority (MDA) debt obligations are issued by a non-profit corporation created by the City for the purpose of financing certain capital construction projects. The MDA issues its own debt obligations, which are repaid through a lease purchase agreement with the City equal to the debt service requirements. The City can utilize the City’s excise tax, state shared revenues and other unrestricted revenues for lease payments. 63 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 D. Community Facilities District bonds Community Facilities Districts (CFD’s), are special purpose districts created specifically to acquire or construct public infrastructure within specified areas of the City. CFD’s are authorized under state law to issue general obligation (GO) or revenue bonds to be repaid by property (ad valorem) taxes levied on property within the district (for GO debt), or by specified revenues generated within the districts (revenue bonds). CFD’s are created by petition to the City Council by property owners within the area to be covered by the district, and debt may be issued in accordance with relevant state laws and regulations. Operation and maintenance expenditures, bonds and the repayment of bonds issued by these separate legal entities is the responsibility of the district, not the City. As the administrator for the district, the City collects the property taxes and makes the debt payments on behalf of the district. The City Council formed the Vistancia Community Facilities District (VCFD) in October 2002. VCFD was subsequently authorized, by the voters of the district in November 2002, to issue up to $100,000,000 in general obligation bonds to construct public infrastructure within VCFD. VCFD issued general obligation bonds of $21,250,000, $23,550,000 and $22,760,000 in fiscal years 2003, 2005, and 2007, respectively, against this authorization. The VCFD refunded all these obligations during fiscal year 2016 through the issuance of $36,985,000 in general obligation bonds. In fiscal year 2021 the VCFD refunded the remaining 2016 refunding bonds through an issuance of $20,855,000 in general obligation bonds. Additionally, VCFD issued $1,870,000 in new general obligation bonds against the original $100,000,000 authorization. The City Council formed the Vistancia West Community Facilities District (VWCFD) in August 2014. In December 2014, the VWCFD was authorized through an election to issue up to $9,000,000 of general obligation bonds to construct public infrastructure within the district. VWCFD issued taxable general obligation bonds of $35,000 in fiscal year 2015, $3,000,000 in fiscal year 2017, and $2,590,000 in fiscal year 2020. The City Council formed the Vistancia North Community Facilities District (VNCFD) in June 2020. In October 2020, the VNCFD was authorized through an election to issue up to $50,000,000 of general obligation bonds to construct public infrastructure within the district. VNCFD issued short-term taxable general obligation bonds of $15,987 and $18,950 in fiscal year 2022 and 2023, respectively. The City Council formed the Mystic at Lake Pleasant Heights Community Facilities District (MCFD) in June 2020. In October 2020, the MCFD was authorized through an election to issue up to $65,000,000 of general obligation bonds to construct public infrastructure within the district. MCFD issued a short-term taxable general obligation bond of $56,572 in fiscal year 2022 and a general obligation bond of $3,625,000 in fiscal year 2023. E. Pledged revenues The City has pledged certain future revenues to repay specific bonded debt as follows: The City has pledged future water utility and wastewater utility revenues, net of specific operating expenses, to repay $35,190,000 in Revenue Refunding Bonds issued in 2020, $28,955,000 in Revenue Refunding Bonds issued in 2022 and $62,879,948 in Water Infrastructure Financing Authority loans issued between 2002-2017. The various bonds and loans were issued for the purchase or construction of various water or wastewater infrastructure including wells, treatment plants, pumping stations, a water utility and water and wastewater distribution or collection lines. At June 30, 2023, $100,713,612 in bonds and loans remain outstanding to be repaid by future water and wastewater revenues. For the fiscal year ended June 30, 2023, the pledged revenues, net of operating expenses available for service of this debt were $23,526,908. The debt principal and interest paid on this debt in fiscal year 2023 was $10,775,633, net of amortized premium. 64 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 The City has pledged certain revenues to repay $3,220,000 of Pledged Excise Tax 2018 Refunding Obligations and $21,495,000 of Pledged Excise Tax 2022 Refunding Obligations. Pledged revenues for these obligations include excise taxes and state shared revenues not specifically reserved by law or other regulation to be expended for other purposes. At June 30, 2023, $1,315,000 of the Pledged Excise Tax 2018 Obligation and $21,015,000 of the Pledged Excise Tax 2022 Obligations remained outstanding to be repaid by these future revenues. The obligations were issued to construct various City operational facilities and refund prior MDA bonds. For the fiscal year ended June 30, 2023, the pledged revenues, net of operating expenses available to service this debt were $214,452,849. The debt principal and interest paid on this debt in fiscal year 2023 was $1,688,890. The City has pledged certain revenues for the repayment of $25,755,000 of the Pledged Transportation 2018 refunding obligations. The obligations were issued to refund prior MDA bonds originally issued to construct transportation infrastructure. Pledged revenues for this obligation include transportation sales tax, excise taxes and state shared revenues. At June 30, 2023, $10,095,000 of the Pledged Transportation 2018 obligations remained outstanding to be repaid by future revenues. For the fiscal year ended June 30, 2023, the pledged revenues, net of operating expenses available to service this debt were $233,739,705. The debt principal and interest paid on this debt in fiscal year 2022 was $3,517,995. F. Direct Purchase and Loan Obligations In September 2017, the City entered into a New Clean Renewable Energy Bond (NCREB) agreement to provide financing for solar renewable energy projects at several locations throughout the City. The City borrowed $5,199,304 for a term of 20 years, at a rate of 4.23%. The majority of the debt service payments will be funded from expected savings on the City’s electricity bills. In the event of default, the Lessor may take whatever action at law or in equity may appear necessary or desirable to enforce its rights under this Agreement or the Escrow Agreement or as a secured party in any or all of the Equipment or the Escrow Account or the Delivery Costs Account. G. Tables The following schedule summarizes the City’s long-term liability activity for the year ended June 30, 2023: Beginning Balance* Governmental activities: Bonds payable: General obligation bonds General obligation WIFA loans Excise tax revenue obligations Direct purchase and loan obligations CFD bonds Total bonds payable Net pension and other postemployment benefits liability Compensated absences Claims payable Leases payable SBITA payable Deferred bond premium Governmental activities totals Business-type activities: Bonds and loans payable: Revenue bonds WIFA loans Net pension and other postemployment benefits liability Compensated absences Leases payable Deferred bond premium Business-type activities totals $ $ $ $ 162,020,000 3,724,398 21,495,000 19,621,324 23,480,000 230,340,722 140,764,979 17,247,490 6,950,800 32,546 2,927,106 17,569,101 415,832,744 59,815,000 48,718,291 12,937,761 1,870,780 6,478,550 129,820,382 Additions $ $ 23,810,000 4,273,075 3,625,000 31,708,075 12,960,591 14,142,383 21,737,327 372,373 1,547,460 82,468,209 $ $ Reductions 3,530,253 1,591,164 12,868 5,134,285 * Revised due to implementation of GASB 96 65 $ $ $ $ 15,910,000 934,188 480,000 3,873,485 4,030,000 25,227,673 6,304,981 12,566,069 19,545,252 17,498 1,384,295 2,094,674 67,140,442 4,560,000 3,259,681 1,387,017 1,176 757,958 9,965,832 Ending Balance Due Within One Year $ $ $ $ $ 169,920,000 7,063,285 21,015,000 15,747,839 23,075,000 236,821,124 147,420,589 18,823,804 9,142,875 15,048 1,915,184 17,021,887 431,160,511 55,255,000 45,458,610 16,468,014 2,074,927 11,692 5,720,592 124,988,835 $ $ $ 13,625,000 950,876 2,050,000 3,948,221 4,240,000 24,814,097 8,281,657 8,234,981 6,925 966,171 42,303,831 5,525,000 3,203,843 949,026 2,423 9,680,292 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 Bonds and loans payable at June 30, 2023 are comprised of the following: Governmental Activities Debt General Obligation Bonds Maturity Dates Net Interest Rate Issue Amount Outstanding June 30, 2023 Series 2012A 7/1/12-32 3.32 14,715,000 8,305,000 Series 2015A 7/15/16-35 2.98 30,325,000 22,190,000 Series 2015B 7/15/16-28 2.29 66,425,000 36,005,000 Series 2019 7/15/19-39 2.65 30,420,000 25,250,000 Series 2021 7/15/22-41 1.72 55,880,000 54,360,000 Series 2022 7/15/23-42 3.99 Total General Obligation Bonds 23,810,000 23,810,000 $221,575,000 $ 169,920,000 $ $ WIFA General Obligation Loans WIFA series 2019 7/1/20-39 1.6 WIFA series 2021 7/1/22-41 1.85 Total WIFA General Obligations 5,446,959 5,006,943 3,756,818 3,306,467 $ 10,453,902 $ 7,063,285 $ 21,495,000 $ 21,015,000 $ 21,495,000 $ 21,015,000 $ $ Excise Tax/State Shared Revenue Obligations Series 2022 7/15/22-32 2.73 Total Direct Purchase and Loan Obligations Direct Purchase and Loan Obligations Taxable NCREBs 9/1/1937 4.23 Pledged Excise 2018 7/15/2025 2.01 3,220,000 1,315,000 Pledged Transportation 2018 1/15/2026 1.97 25,755,000 10,095,000 Total Direct Purchase and Loan Obligations 5,199,304 4,337,839 $ 34,174,304 $ 15,747,839 $ 15,550,000 Community Facility District Bonds VCFD – Series 2020 7/15/21-26 0.87 $ 22,725,000 VWCFD – Series 2016 7/15/18-29 4.15 3,000,000 1,960,000 VWCFD – Series 2019 7/15/20-29 4.00 2,590,000 1,940,000 MCFD – Series 2023 7/15/23-47 4.36 Total Community Facility District Bonds 3,625,000 $ 31,940,000 66 3,625,000 $ 23,075,000 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 Business-Type Activities Debt Revenue Bonds Maturity Dates Net Interest Rate Issue Amount Outstanding June 30, 2023 WWW Series 2020 7/15/21-29 0.53 $ 35,190,000 $ WWW Series 2022 7/15/23-42 3.78 28,955,000 Total Revenue Bonds 26,300,000 28,955,000 $ 64,145,000 $ 55,255,000 WIFA Loans WIFA Series 2009 7/1/10-29 3.27 4,371,597 1,758,255 WIFA Series 2015 7/15/16-35 2.40 14,000,000 9,833,487 WIFA Series 2017 7/15/18-36 2.65 44,508,351 Total WIFA loans 33,866,868 $ 62,879,948 $ 45,458,610 The following table discloses the bond debt service requirements as of June 30, 2023, segregating principal and interest, for the next five years and in five-year increments thereafter. Governmental Activities* Bonds and General Obligation Loans Fiscal year 2024 Principal $ 20,865,876 Notes from Direct Borrowings and Direct Placements Interest $ 8,074,278 Business-type Activities* Principal $ Interest 3,948,221 $ Principal 402,279 $ Interest 8,728,843 $ 3,649,088 2025 21,082,862 7,203,840 4,028,267 319,415 9,263,555 2026 22,040,152 6,256,320 4,088,633 234,789 9,664,245 3,275,750 2,881,110 2027 23,022,753 5,360,258 239,328 153,258 10,088,114 2,468,076 2028 13,030,669 4,695,298 250,360 143,018 8,534,670 2,124,216 2029-2033 59,208,536 16,321,180 1,429,749 544,508 26,180,380 7,655,411 2034-2038 43,382,162 7,332,976 1,763,281 207,298 22,989,186 3,550,004 2039-2043 30,978,531 1,995,074 - - 9,770,000 1,007,600 2044-2048 Totals 1,060,000 $ 234,671,541 119,658 $ 57,358,882 $ 15,747,839 $ 2,004,565 - $ 105,218,993 $ 26,611,255 *Includes required principal and estimated interest payments for approved WIFA loans that have not fully drawn as of 6/30/23, the principal payments are contractual and the loans are expected to draw in FY2024. Long-term compensated absences and net pension and OPEB liabilities of governmental activities are expected to be liquidated by the operating funds (primarily the General Fund, Highway User Revenue Fund, Transit Fund and utility funds) as they come due. 67 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 8. RISK FINANCING ACTIVITIES The City is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors and omissions; natural disasters; workers’ compensation; and health insurance. The City maintains a Risk Management Fund, an Employee Benefits Trust Fund and a Workers’ Compensation Trust Fund (presented in the Self-Insurance Fund of the Internal Service Funds) to account for and finance its uninsured risks of loss. Premiums are paid into the internal service funds by the other operating funds and are available to pay claims, claim reserves and administrative costs of the program. These interfund premiums are used to fund claim expenses reported in the internal service funds. The City uses third party administrators to monitor the workers’ compensation and health insurance claims programs. As with any risk retention program, the City is contingently liable with respect to claims beyond those actuarially projected. Risk management The City is self-insured for general liability with a $1,000,000 self- insured retention (SIR) and a $3,000,000 general aggregate. The City purchases layers of excess coverage above the underlying policy limits. The City is self-insured for auto physical damage (collision and comp) on all city vehicles valued at under $100,000. The vehicles valued over $100,000 are insured for physical damage with a $5,000 deductible. All city autos have the $1,000,000 liability SIR. City property is insured through commercial insurance coverage with a $50,000 deductible. The City has and obtains other specialized polices as needed, in addition to the yearly insurance procurement process and package of coverages and policies. The operating funds of the City pay monthly premiums to the risk management fund based upon a model taking into consideration multiple factors including prior loss experience, staffing, liability exposures, and operating budget. Premium payments to insurance carriers are made directly from the risk management fund. There have been no settlements paid in excess of insurance in any of the past three years nor has insurance coverage been significantly reduced in recent years. Workers’ compensation On July 1, 2009, the City established a workers’ compensation trust fund for work-related injuries to employees. For workers’ compensation insurance, the City is self-insured up to $2,250,000 per claim for both public safety employees and for all other employees up to an aggregate stop loss of $4,555,982 for fiscal year 2023. Commercial insurance is purchased to cover claims above the self-insurance amounts. Operating funds with employees covered under the workers’ compensation insurance program pay monthly premiums to the workers’ compensation fund based upon staffing levels. Premium payments to insurance carriers, as well as third party administrator costs are made directly from the workers’ compensation trust fund. Employee wages while off work for workers’ compensation injuries (2/3rds of weekly wages) are also paid from this fund. There have been no settlements paid in excess of insurance in the last three years, nor has insurance coverage been significantly reduced in recent years. Health insurance On January 1, 2010, the City established a health insurance trust fund for health insurance coverage for City employees and dependents. The City is self-insured for employee health claims up to $200,000 per claimant. Commercial insurance is purchased for claims in excess of those limits. Premiums are collected through contributions from employee paychecks and department budgets. COBRA participants contribute 100% of the premiums for their insurance coverage. Premiums for the medical, vision, dental, and life insurance plans are determined prior to each renewal period by estimating the costs of claims and administration of the plan based on a number of factors including: the demographics of the group, previous claims history, plan design changes and any new mandated benefits. 68 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 Premium payments to insurance carriers, as well as third party administrator costs are made directly from the health insurance trust fund. There have been no settlements in excess of insurance in the past three years, nor has insurance coverage been significantly reduced in recent years. Estimated liability – The total claims liability of $8,142,875 reported in the Self-Insurance Fund at June 30, 2023, is based on the requirements of Governmental Accounting Standards Board Statement #10, which requires that liabilities be reported when it is probable that a loss has occurred and the amount of the loss can be reasonably estimated. The claims liability consists of $206,273 for liability/property claims, $6,248,614 for workers’ compensation claims and $1,687,988 for health insurance claims. The claims liability includes an estimated amount for claims that have been incurred but not reported (IBNR). Claim liabilities are calculated considering the effects of inflation, recent claim settlement trends, including frequency and amount of payouts, and other economic and social factors. Non-incremental claims adjustment expenses are not included in the calculation. Changes in the Self-Insurance Fund’s claims liability amount (claims only, exclusive of other insurance expenses) during the last two fiscal years are as follows: Fiscal Year 2022: Risk management Beginning of Fiscal Year Liability Current Year Claims and Changes in Estimates $ $ 1,068,049 (14,584) Claims Payments $ (840,420) Balance at Fiscal Year-end $ 213,045 Workers' comp 5,376,181 842,467 (1,154,093) 5,064,555 Health insurance 1,773,583 17,431,596 (17,531,979) 1,673,200 18,259,479 $ (19,526,492) $ 8,217,813 $ $ 6,950,800 Fiscal Year 2023: Risk management Beginning of Fiscal Year Liability Current Year Claims and Changes in Estimates $ $ 213,045 2,012,010 Claims Payments $ (1,018,782) Balance at Fiscal Year-end $ 1,206,273 Workers' comp 5,064,555 842,468 341,591 6,248,614 Health insurance 1,673,200 18,882,849 (18,868,061) 1,687,988 21,737,327 $ (19,545,252) $ 6,950,800 $ $ 9,142,875 9. LEASES A. City as Lessee The City has entered into lease agreements to provide copy center equipment, a trash compactors at Rio Vista Park and the Peoria Sports Complex, and the Mayor’s vehicle. The original lease terms were four or five years. The lease assets are presented in the Government-wide financial statements and listed separately in Note 6. 69 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 The following schedule summarizes the City’s lease liability activity for the year ended June 30, 2023: Description Beginning Liability Balance Rate Additions Remeasurements Ending Liability Balance Payments Due within one year Governmental Activities Copier Services Lease - ACON 22918 Mayor's Car - ACON 53918 Rio Vista Trash Compactor - ACON 57116A 2.60% $ 2.60% 2.47% 15,059 $ 3,218 14,269 - - $ (400) - (11,245) $ (2,818) (3,035) 3,814 $ 11,234 3,814 3,111 $ 32,546 $ - (400) $ (17,098) $ 15,048 $ 6,925 12,868 - (1,176) 11,692 2,423 12,868 - (1,176) $ 11,692 $ 2,423 Total Business-type Activities Sports Complex Trash Compactor - ACON 55616A 3.92% - Total $ - $ $ The following table discloses the lease payment requirements as of June 30, 2023, segregating principal and interest, for the next five years. Governmental Activities Business-type Activities* Fiscal year Principal Interest Principal Interest 2024 $ 6,925 $ 263 $ 2,423 $ 415 2025 3,189 165 2,520 318 2026 3,269 85 2,620 218 2027 1,665 12 2,725 113 2028 Totals - - 1,404 16 $ 15,048 $ 525 $ 11,692 $ 1,080 B. City as Lessor In 2005, the City leased property and two office buildings in the P83 district. The original lease term, including available extensions, is 75 years. The lease payments are fixed and increase 2.5% per year. The implied interest rate on the lease is 3.81% which resulted in $304,905 of interest earnings in fiscal year 2023. Lease payments totaled $199,976 resulting in an interest receivable of $104,929. In 2011 the City leased property to a sports medicine and training facility at the Peoria Sports Complex. The original lease term, including available extensions, is 70 years. The lease payments are fixed and increase 10% every five years. The implied interest rate on the lease is 3.02% which resulted in $76,183 of interest earnings in fiscal year 2023. Lease payments totaled $58,084 resulting in an interest receivable of $18,099. In 2017, the City leased property for the Arizona Broadway Theater (ABT). The original lease term, including available extensions, is 45 years. In fiscal year 2023, ABT exercised the purchase option in the lease and the lease was closed out. In 2018, the City leased property for a cell tower at Fire Station #4. The original lease term, including available extensions, is 25 years. The lease payments are fixed and increase 4% per year. The implied interest rate on the lease is 2.49%. In fiscal year 2023, the City recognized $18,600 in payments against the receivable and $18,351 of interest earnings. In 2021, the City leased property for a cell tower at Peoria Sports Complex. The original lease term, including available extensions, is 30 years. The lease payment has two components, an annual base rate 70 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 that is fixed for the term of the lease, and a sub-lease fee that is fixed at a per sub-lessee rate. If the number of sub-lessees changes, the lease payment will change. All calculations are based on the current number of sub-lessees. The implied interest rate on the lease is 2.47%. In fiscal year 2023 the City recognized $39,197 in payments against the receivable and $38,803 of interest earnings. 10. SUBSCRIPTION-BASED INFORMATION TECHNOLOGY ARRANGEMENTS The City has entered into various subscription-based information technology arrangements (SBITA) to provide software solutions. The original SBITA terms range from two to seven years and all include fixed payments. The SBITA assets are presented in the Government-wide financial statements and listed separately in Note 6. The following schedule summarizes the City’s SBITA liability activity for the year ended June 30, 2023: Rate Beginning Liability Balance 1.66%-3.92% $ 2,927,106 Description Governmental Activities Additions $ Payments Ending Liability Balance Due within one year 372,373 $ (1,384,295) $ 1,915,184 $ 966,171 The following table discloses the SBITA payment requirements as of June 30, 2023, segregating principal and interest, for the next three years. Governmental Activities Fiscal year 2024 Principal $ Interest 966,171 $ 43,806 2025 676,021 18,341 2026 Totals 272,992 1,970 $ 1,915,184 $ 64,117 11. PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS The City of Peoria contributes to the pension plans described below. The City of Peoria contributes to the Elected Officials Retirement Plan; however the plan is not described below because of its relative insignificance to the financial statements. The plans are component units of the State of Arizona. A summary of pension and other postemployment benefit related items as of and for the year ended June 30, 2023, is presented below: Plan ASRS Governmental Activities Business-Type Activities PSPRS - Police PSPRS - Fire Net Pension and Other Postemployment Benefits Liability Other Postemployment Benefits Asset $ $ $ 67,511,923 16,468,014 43,976,524 35,932,142 163,888,603 $ Deferred Outflows of Resources 2,350,160 573,269 363,732 482,992 3,770,153 $ $ 10,663,681 2,576,710 19,776,537 24,321,666 57,338,594 Deferred Inflows of Resources Pension and Other Postemployment Expense $ $ $ 3,668,562 894,864 741,499 1,221,452 6,526,377 $ 6,255,364 1,917,834 7,562,524 7,031,869 22,767,591 The City of Peoria reported $28,771,297 of pension and OPEB contributions as expenditures in the governmental funds related to all plans to which it contributes. 71 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 A. Arizona State Retirement System Plan Description. City of Peoria employees not covered by the other pension plans described after this section 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 cost-sharing multiple-employer defined benefit long-term disability (OPEB) plan. The Arizona State Retirement System Board governs the ASRS according to the provisions of A.R.S. Title 38, Chapter 5, Articles 2 and 2.1. The ASRS is a component unit of the State of Arizona. 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, long-term 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 consecutive 36 months of last 120 months Highest consecutive 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 members’ death. For retired members, the retirement benefit option chosen determines the survivor benefit. For all other members, the beneficiary is entitled to the member’s account balance that includes the member’s contributions and employer’s contributions, plus interest earned. Health insurance premium benefits are available to retired or disabled members with 5 years of credited service. The benefits are payable only with respect to allowable health insurance premiums for which the member is responsible. For members with 10 or more years of service, benefits range from $100 per month to $260 per month depending on the age of the member and dependents. For members with 5 to 9 years of service, the benefits are the same dollar amounts as above multiplied by a vesting fraction based on completed years of service. Active members are eligible for a monthly long-term disability benefit equal to two-thirds of monthly earnings. Members receiving benefits continue to earn service credit up to their normal retirement dates. Members with long-term disability commencement dates after June 30, 1999, are limited to 30 years of service or the service on record as of the effective disability date if their service is greater than 30 years. 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, statute required active ASRS members to 72 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 contribute at the actuarially determined rate of 12.17 percent (12.03 percent for retirement & health insurance benefits and 0.14 percent for long-term disability) of the members’ annual covered payroll, and the City of Peoria was required by statute to contribute at the actuarially determined rate of 12.17 percent (11.92 percent for retirement, 0.11 percent for health insurance premium benefit, and 0.14 percent for longterm disability) of the members’ annual covered payroll. These percentages led to City’s contributions for the year ended June 30, 2023 of $7,956,552, $73,428, and $93,445 to the pension, health insurance premium benefit, and long-term disability plans, respectively. In addition, the City of Peoria was required by statute to contribute at the actuarially determined rate of 9.68 percent (9.62 percent for retirement, 0.00 percent for health insurance premium benefit, and 0.06 percent for long-term disability) of annual covered payroll of retired members who worked in positions that would typically be filled by an employee who contributes to ASRS. Liability. The net asset and net liabilities were measured as of June 30, 2022. The total liability used to calculate the net asset or liability was determined using update procedures to roll forward the total liability from an actuarial valuation as of June 30, 2021, to the measurement date of June 30, 2022. The City's proportion of the net assets or net liability was based on the City's actual contributions to the plan relative to the total of all participating employers' contributions for the year ended June 30, 2022, and the change from its proportion measured as of June 30, 2021. At June 30, 2023, the City of Peoria reported the following asset and liabilities for its proportionate share of the ASRS’ net/pension/OPEB asset or liability. In addition, the City's proportion for each plan measured as of June 30, 2022, and the change from its proportion measured as of June 30, 2021 was: Net pension/OPEB (asset) liability ASRS Pension Health insurance premium benefit Long-term disability $ 83,932,124 (2,923,429) 47,813 Proportion June 30, 2022 % 0.51422 0.52382 0.51768 Increase (decrease) from June 30, 2021 0.001 0.002 0.000 Pension/OPEB Expense and Deferred Outflows/Inflows of Resources. For the year ended June 30, 2023, the City of Peoria recognized the following pension and OPEB expense for ASRS. ASRS Pension/OPEB expense Pension $ Health insurance premium benefit Long-term disability 8,586,537 (427,760) 14,421 73 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 Deferred outflows/inflows of resources. At June 30, 2023, the City of Peoria reported deferred outflows of resources and deferred inflows of resources related to pensions and OPEB from the following sources: Deferred Health insurance premium benefit Deferred Deferred Long-term disability Deferred Deferred outflows of inflows of outflows of inflows of outflows of inflows of resources resources resources resources resources resources Pension Deferred Differences between expected and actual experience Changes of assumptions or other inputs $ 715,152 Difference between projected and actual earnings on plan investments Changes in proportion and differences between City contributions and proportionate share of contributions City contributions subsequent to the measurement date Total $ $ - $ 1,491,952 $ 24,886 $ 44,551 4,165,714 - 47,447 79,732 26,039 116,695 - 2,210,852 - 98,477 - 1,486 134,824 503,421 2,904 2,338 - 13,922 7,956,552 $ - 12,972,242 $ 73,428 2,714,273 $ 123,779 $ 1,672,499 93,445 $ 144,370 $ 176,654 The deferred outflows of resources related to ASRS pensions and OPEB resulting from contributions subsequent to the measurement date as reported in the table above will be recognized as an increase of the net asset or a reduction of the net liability in the year ended June 30, 2024. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to ASRS pensions and OPEB will be recognized as expenses as follows: Year ending June 30 2024 2025 2026 2027 2028 Thereafter $ Health insurance premium benefit Pension 3,543,189 $ (446,241) (941,787) (485,234) (3,838,561) (532,117) 3,538,576 (79,906) (78,650) - Long-term disability $ (12,961) (15,637) (26,834) (5,424) (24,537) (40,336) Actuarial Assumptions. The significant actuarial assumptions used to measure the total pension/OPEB liability are as follows: Actuarial valuation date June 30, 2021 Actuarial roll forward date June 30, 2022 Actuarial cost method Entry Age Normal Investment rate of return 7.0% Projected salary increases 2.9 - 8.4% for pensions/not applicable to OPEB Inflation 2.3% Permanent benefit increase Included for pensions/not applicable for OPEB Mortality rates Recovery rates 2017 SRA Scale U-MP for pensions and health insurance premium benefit 2012 GLDT for long-tem disability Healthcare cost trend rate Not applicable Actuarial assumptions used in the June 30, 2021, valuation were based on the results of an actuarial experience study for the 5-year period ended June 30, 2020. 74 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 The long-term expected rate of return on ASRS pension plan investments was determined to be 7 percent using a building-block method in which best-estimate ranges of expected future real rates of return (expected returns, net of plan investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage, excluding any expected inflation. The target allocation and best estimates of geometric real rates of return for each major asset class of ASRS are summarized in the following table: Long-Term expected geometric real Target rate of return Allocation Asset Class Equity 50% 3.90% Fixed income - credit Fixed income - interest rate sensitivity 20% 5.30% 10% -0.02% Real estate 20% 1.20% Total 100% Discount Rate. The discount rate used to measure the ASRS total pension/OPEB liability was 7 percent. The projection of cash flows used to determine the discount rate assumed that contributions from participating employers will be made based on the actuarially determined rates based on the ASRS Board’s funding policy, which establishes the contractually required rate under Arizona statute. Based on those assumptions, the plans’ fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on plan investments was applied to all periods of projected benefit payments to determine the total pension/OPEB liability. Sensitivity of the Proportionate Share of the Net Pension/OPEB (Asset) Liability to Changes in the Discount Rate. The following table presents the City of Peoria’s proportionate share of the net pension/OPEB (asset) liability calculated using the discount rate of 7.0 percent, as well as what the proportionate share of the net pension/OPEB (asset) liability would be if it were calculated using a discount rate that is 1-percentage-point lower or 1-percentage-point higher than the current rate: Net pension liability Net insurance premium benefit liability (asset) Net long-term disability liability 1% Decrease (6.0%) $ 123,839,356 (2,102,105) 79,262 Current Discount Rate (7.0%) $ 83,932,124 (2,923,429) 47,813 1% Increase (8.0%) $ 50,655,730 (3,620,309) 17,337 Plan Fiduciary Net Position. Detailed information about the plans’ 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 of Peoria public safety employees who are regularly assigned hazardous duty participate in the Public Safety Personnel Retirement System (PSPRS). The PSPRS administers agent and cost-sharing multiple-employer defined benefit pension plans and agent and cost-sharing multiple-employer defined benefit health insurance premium benefit (OPEB) plans. A nine-member board known as the Board of Trustees and the participating local boards govern the PSPRS according to the provisions of A.R.S. Title 38, Chapter 5, Article 4. The PSPRS issues a publicly available financial report that includes their financial statements and required 75 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 supplementary information. The report is available on the PSPRS website at www.psprs.com. Benefits Provided. The PSPRS provides retirement, health insurance premium supplement, disability, and survivor benefits. State statute establishes benefits terms. Certain retirement and disability 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. Initial Membership Date: Years of service and age required to receive benefit Final average salary is based on Benefit percent Normal retirement Before January 1, 2012 20 years of service and any age or 15 years of service and age 62 On or After January 1, 2012 and before July 1, 2017 25 years of service or 15 years of credited service, and age 52.5 On or after July 1, 2017 15 years of credited service, age 52.5* 15 or more years of service, age 55 Highest 36 consecutive months of last 20 years Highest 60 consecutive months of last 20 years Highest 60 consecutive months of last 15 years 50% less 2.0% for each year of credited service less than 20 years or plus 2.0% to 2.5% for each year of credited service over 20 years, not to exceed 80% 1.5 to 2.5% per year of credited service, not to exceed 80% Accidental disability retirement 50% or normal retirement, whichever is greater Catastrophic disability retirement 90% for the first 60 months reduced to either 62.5% or normal retirement, whichever is greater Survivor benefit Retired members Active members 80% to 100% of retired member’s pension benefit 80% to 100% of accidental disability retirement benefit or 100% of average monthly compensation if death was the result of injuries received on the job Retirement benefits for employees who became a member on or after July 1, 2017, (Tier 3 members) are contingent upon which retirement plan is chosen by a member. This group of members has an irrevocable choice of enrolling in either the defined benefit plan (police employees) or a hybrid plan, which has elements of both a defined benefit and defined contribution plan (fire employees), or a defined contribution plan in lieu of the respective choices listed above (both police and fire employees). If enrolling in the defined benefit plan or hybrid plan, benefits (defined benefit portion only for the hybrid plan) commence the first day of the month following termination of employment and are based upon the following:  Age 55 with 15 or more years of credited service: average monthly benefit compensation times a multiplier that varies by years of service, from 1.5 percent to 2.5 percent per year of service, times the number of years of service - up to a maximum of 80 percent of the average monthly benefit compensation.  An individual who became a member on or after July 1, 2017, and reaches age 52.5 with at least 15 years of credited service may take an early retirement; however, the amount of his or her retirement benefit is actuarially reduced. Retirement and survivor benefits are subject to automatic cost-of-living adjustments. The adjustments are based on inflation for PSPRS. In addition, the Legislature may enact permanent one-time benefit increases after a Joint Legislative Budget committee analysis of the increase’s effect on the plan. 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 76 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 member is responsible. Benefits range from $100 per month to $260 per month depending on the age of the member and dependents. Employees Covered by Benefit Terms. At June 30, 2023, the following employees were covered by the agent pension plan’s benefit terms: PSPRS - POLICE Pension Health PSPRS - FIRE Pension Health Inactive employees or beneficiaries currently receiving benefits 116 116 56 56 Inactive employees entitled to but not yet receiving benefits 37 14 23 19 Active employees 132 132 133 133 Total 285 262 212 208 Contributions and Annual OPEB Cost. State statutes establish the pension contribution requirements for active PSPRS employees. In accordance with state statutes, annual actuarial valuations determine employer contribution requirements for PSPRS pension and health insurance premium benefits. The combined active member and employer contribution rates are expected to finance the costs of benefits employees earn during the year, with an additional amount to finance any unfunded accrued liability. Contributions rates for the year ended June 30, 2023, are indicated below. Rates are a percentage of active members’ annual covered payroll. Active members - pension City of Peoria Pension Health Insurance PSPRS Police 7.65% PSPRS Fire 7.65% 48.23% 0.21% 34.33% 0.17% In addition, the City of Peoria was required by statute to contribute at the actuarially determined rate of 34.24 percent for the PSPRS Police, and 19.05 percent for the PSPRS Fire, of annual covered payroll of retired members who worked in positions that would typically be filled by an employee who contributes to the PSPRS. For the agent plans, the contributions to the pension plan and contributions for the health insurance premium benefit for the year ended June 30, 2023 were: PSPRS - Police PSPRS - Fire Pension: Contributions made $ 11,662,574 $ 10,891,970 Health insurance premium benefit: 42,290 Contributions made 77 35,614 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 Asset and Liability. At June 30, 2023, the City of Peoria reported the following assets and liabilities. PSPRS - Police PSPRS – Fire Net pensionliability $ 43,976,524 35,932,142 Net OPEB asset $ (363,732) (482,992) The net assets and net liabilities were measured as of June 30, 2022, and the total liability used to calculate the net asset or liability was determined by an actuarial valuation as of that date. Actuarial Assumptions. The significant actuarial assumptions used to measure the total pension/OPEB liability are as follows: Actuarial Valuation Date June 30, 2022 Measurement Date June 30, 2022 Actuarial Cost Method Entry Age Normal Inflation Salary Increases 2.50% for pensions/not applicable for OPEB 3.25%-15.00%, including inflation, for pensions/not applicable for OPEB Tier 1/2 Investment Rate of Return 7.20% Tier 3 Investment Rate of Return 7.00% Active Lives: PubS-2010 Employee mortality, adjusted by a factor of 1.3 for male members and 1.08 for female members, with generational improvements using 85% of the most recent projection scale (currently Scale MP-2021). 100% of active deaths are assumed to be in the line of duty. Mortality Rates Inactive Lives: PubS-2010 Healthy Retiree mortality, adjusted by a factor of 1.03 for male retirees and 1.11 for female retirees, with generational improvements using 85% of the most recent projection scale (currently Scale MP-2021) Beneficiaries: PubS-2010 Survivor mortality, adjusted by a factor of 0.98 for male beneficiaries and adjusted by a factor of 1.06 for female beneficiaries, with generational improvements using 85% of the most recent projection scale (currently Scale MP-2021). Disabled Lives: PubS-2010 Disabled mortality, adjusted by a factor of 1.08 for male disabled members and 1.01 for female disabled members, with generational improvements using 85% of the most recent projection scale (currently Scale MP2021) Actuarial assumptions used in the June 30, 2022 valuation were based on the results of the 2022 experience study. 78 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 The long-term expected rate of return on PSPRS plan investments was determined to be 7.20 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: Target Allocation Long-Term Expected Geometric Real Rate of Return* U.S. Public Equity 24% 3.49% International Equity 16% 4.47% Global Private Equity 20% 7.18% Other Assets (Capital Appreciation) 7% 4.83% Core Bonds 2% 0.45% Private Credit 20% 5.10% Diversifying Strategies 10% 2.68% Cash - Mellon 1% (0.35)% Total 100% Asset Class Discount Rates. At June 30 2022, the discount rate used to measure the PSPRS total pension/OPEB liabilities was 7.20 percent, which was 0.1 lower than the discount rate used as of June 30, 2021. 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 rates and the member rate. Based on those assumptions, PSPRS plans’ fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on plan investments was applied to all periods of projected benefit payments to determine the total pension/OPEB liability. 79 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 Changes in the Net Pension/OPEB Liability Increase (decrease) PSPRS - POLICE Balances at June 30, 2021 Changes for the year: Service cost Interest on the total liability Differences between expected and actual experience in the measurement of the liability Changes of assumptions or other inputs Contributions – employer Contributions – employee Net investment income Benefit payments, including refunds of employee contributions Administrative expense Net changes Balances at June 30, 2022 Total Pension Liability Plan Fiduciary Net Position Net Pension Liability Increase (decrease) Plan Total OPEB Fiduciary Net Liability Position $ 160,753,257 $ 102,880,751 $57,872,506 $ 2,094,294 3,355,365 11,719,465 60,471 154,251 - 60,471 154,251 3,355,365 11,719,465 - $ (596,124) 1,419,354 1,677,907 - 35,785,241 1,317,660 (4,957,000) 1,419,354 1,677,907 (35,785,241) (1,317,660) 4,957,000 (84,366) 48,624 - 53,232 (104,779) (84,366) 48,624 (53,232) 104,779 (7,136,011) 11,036,080 $ 171,789,337 (7,136,011) (77,828) 24,932,062 $ 127,812,813 77,828 (13,895,982) $43,976,524 (83,482) 95,498 $ 2,189,792 (83,482) (1,865) (136,894) $ 2,553,524 1,865 232,392 $ (363,732) Pension Increase (decrease) PSPRS - FIRE Balances at June 30, 2021 Changes for the year: Service cost Interest on the total liability Differences between expected and actual experience in the measurement of the liability Changes of assumptions or other inputs Contributions – employer Contributions – employee Net investment income Benefit payments, including refunds of employee contributions Administrative expense Other Net changes Balances at June 30, 2022 $ 2,690,418 Net OPEB Asset Total Pension Liability Plan Fiduciary Net Position Net Pension Liability Health insurance premium benefit Increase (decrease) Plan Total OPEB Fiduciary Net Net OPEB Liability Position Asset $ 130,201,295 $ 101,860,154 $28,341,141 $ 1,749,499 3,710,281 9,592,431 56,633 129,786 - 56,633 129,786 3,710,281 9,592,431 - $ 2,326,291 $ (576,792) 4,163,638 1,398,720 - 14,331,947 1,401,092 (4,380,045) 4,163,638 1,398,720 (14,331,947) (1,401,092) 4,380,045 (157,630) 14,185 - 41,562 (90,772) (157,630) 14,185 (41,562) 90,772 (5,016,815) 13,848,255 $ 144,049,550 (5,016,815) (78,925) 6,257,254 $ 108,117,408 78,925 7,591,001 $35,932,142 (56,491) (13,517) $ 1,735,982 (56,491) (1,616) (107,317) $ 2,218,974 1,616 93,800 $ (482,992) 80 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 Sensitivity of the Net Pension/OPEB (Asset) Liability to Changes in the Discount Rate. The following table presents City of Peoria’s net pension/OPEB (assets) liabilities calculated using the discount rates noted above, as well as what the net pension/OPEB (asset) liability would be if it were calculated using a discount rate that is 1-percentage-point lower or 1-percentage-point higher than the current rate: 1% Decrease PSPRS – Police Rate 6.20% Net pension (asset) liability $ 68,706,518 Net OPEB (asset) liability (105,756) PSPRS – Fire Rate 6.20% Net pension (asset) liability $ 57,387,041 Net OPEB (asset) liability (273,223) Current Discount Rate 1% Increase $ 7.20% 43,976,524 (363,732) 8.20% $ 23,908,826 (580,369) $ 7.20% 35,932,142 (482,992) 8.20% $ 18,504,338 (659,510) Plan Fiduciary Net Position. Detailed information about the pension plan’s 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, 2023, the City of Peoria recognized the following pension and OPEB expense: PSPRS - Police PSPRS - Fire Pension Expense $ 7,661,199 7,068,285 81 OPEB Expense $ (98,675) (36,416) CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 Deferred Outflows/Inflows of Resources. At June 30, 2023, the City of Peoria reported deferred outflows of resources and deferred inflows of resources related to pensions and OPEB from the following sources: Health Insurance Benefit Pension Deferred Outflows of Resources PSPRS – Police Differences between expected and actual experience Changes of assumptions or other inputs $ Deferred Inflows of Resources 2,726,329 $ 312,295 Premium Deferred Deferred Outflows of Inflows of Resources Resources $ 20,352 $ 429,204 2,684,230 - 51,311 - Net difference between projected and actual earnings on plan investments 2,545,503 - 43,948 - Contributions subsequent to the measurement date 11,662,574 - 42,290 - Total $ 19,618,636 $ 312,295 $ 157,901 $ 429,204 Health Insurance Benefit Pension Deferred Outflows of Resources PSPRS – Fire Differences between expected and actual experience Changes of assumptions or other inputs $ Deferred Inflows of Resources 7,788,273 $ 708,252 Premium Deferred Deferred Outflows of Inflows of Resources Resources $ 61,172 $ 464,406 3,543,905 - 22,257 48,794 Net difference between projected and actual earnings on plan investments 1,939,179 - 39,296 - Contributions subsequent to the measurement date 10,891,970 - 35,614 - Total $ 24,163,327 $ 708,252 82 $ 158,339 $ 513,200 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 The amounts reported as deferred outflows of resources related to pension and OPEB resulting from contributions subsequent to the measurement date will be recognized as an increase in the net asset or a reduction of the net liability in the year ended June 30, 2024. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to pensions and OPEB will be recognized as expenses as follows: Pension Year ending June 30: 2024 2025 2026 2027 2028 Thereafter PSPRS - Police $ 1,706,660 1,670,250 810,878 3,455,979 - OPEB PSPRS - Fire $ 2,422,819 1,826,773 871,681 3,769,407 1,334,993 2,337,432 PSPRS - Police $ (99,329) (104,308) (117,898) 13,899 (5,957) - PSPRS - Fire $ (56,623) (63,504) (85,588) (15,399) (67,766) (101,595) 12. DEFERRED COMPENSATION PLAN The City offers deferred compensation plans to its employees and management employees, created in accordance with Internal Revenue Code Section 457 and Section 401a. The plans permit participants to defer contributions into the plan until future years. The deferred compensation is not available to employees, under either plan, until termination, retirement, death or unforeseeable emergency. The City’s fiduciary responsibility is that of exercising “due care” in selecting a third-party administrator. Federal legislation requires that Section 457 and 401a plan assets be held in trust for employees. This means that employee assets held in Section 457 and 401a plans are not the property of the City and are not subject to claims of the City’s general creditors. Also, the City exercises no administrative control nor makes investment decisions. Therefore, the deferred compensation assets are not included in the City’s Basic Financial Statements. 13. CONTINGENCIES, COMMITMENTS AND OTHER CLAIMS The City is involved in litigation arising in the ordinary course of its operations. The City believes that its ultimate liability, if any, in connection with these matters will not have a material adverse effect on the City's financial position, changes in financial position, or liquidity. The City is self-insured for the first $1,000,000 of any occurrence and then has additional coverage up to $25.0 million. Amounts received or receivable from grant agencies are subject to audit and adjustment by grantor agencies, principally the federal government. Any disallowed claims, including amounts already collected, may constitute a liability of the applicable funds. The amount, if any, of expenditures that may be disallowed by the grantor cannot be determined at this time, although the City expects such amounts, if any, to be immaterial. The City has development agreements where, in return for developers constructing public infrastructure, the City agreed to reimburse the developer for the cost of such infrastructure at some future time contingent on the collection of impact fees and sales tax revenues. The City had the following significant commitments as of June 30, 2023:      $1,155,876 in the GO Bond Capital Projects Fund for design of a new fleet shop. $1,887,205 in the Wastewater Utility Fund for construction at the 112 th and Northern lift station. $1,374,481 in the Water Utility Fund for pre-construction services at the Salter Well Site. $11,435,653 in the Wastewater Utility Fund for the Beardsley Plant expansion. $13,780,498 in the Water and Wastewater Utility Funds for reclaimed water pipelines. 83 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 14. INTERFUND TRANSACTIONS, RECEIVABLE AND PAYABLE BALANCES At June 30, 2023, there were interfund loans from the General Fund to the GO Bond Capital Projects Fund and the Non-Bond Debt Service Fund to cover deficit cash balances in those funds. The loans are expected to be repaid in the following year. The interfund transfers generally fall within one of the following categories: 1) debt service payments made from a debt service fund but funded from an operating fund; 2) subsidy transfers; 3) transfers to fund internal service equipment replacement funds; or 4) capital assets purchased or constructed in one fund, but capitalized in another. There were no significant transfers during fiscal year 2023 that were either nonroutine in nature or inconsistent with the activities of the fund making the transfer. The following interfund transfers are reflected in the fund financial statements for the year ended June 30, 2023: Fund Governmental funds: General Fund Highway User Revenue Fund Transportation Sales Tax Fund Non-Bond Capital Projects Fund Non-Major Governmental Funds Total governmental funds Enterprise funds: Water Utility Fund Wastewater Utility Fund Stadium Fund Storm Drain Utility Fund Total enterprise funds Internal Service funds Transfers out $ 7,293,649 334,700 8,294,996 64,124 12,278,566 28,266,035 Transfers in $ 1,398,724 5,379,915 6,778,639 22,493 $ Grand totals 84 35,067,167 860,000 1,000,000 7,624,295 9,484,295 10,169,825 6,932,602 4,056,800 1,266,132 22,425,359 3,157,513 $ 35,067,167 CITY OF PEORIA, ARIZONA NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 2023 15. STABILIZATION ARRANGEMENTS The committed and assigned fund balances of the governmental funds are shown on the fund financial statements. The following table presents the City’s stabilization reserves included in the proprietary fund financial statements at June 30, 2023: Water Utility Fund: Working capital policy reserve Rate stabilization Debt stabilization System asset maintenance Capital equipment replacement $ Wastewater Utility Fund: Working capital policy reserve Rate stabilization Debt stabilization System asset maintenance Capital equipment replacement 11,249,458 2,566,675 4,011,090 10,971,544 1,447,362 30,246,129 4,396,732 1,219,158 2,166,958 9,207,055 1,077,226 18,067,129 Solid Waste Utility Fund: Working capital policy reserve Capital equipment replacement 3,329,991 4,307,219 7,637,210 Stadium Fund: Capital equipment replacement Total enterprise funds $ Internal Service Funds: Capital equipment replacement Risk management purpose Total internal service funds $ $ 478,622 56,429,090 19,519,712 6,802,770 26,322,482 16. SEGMENT INFORMATION FOR ENTERPRISE FUNDS Both the Water Utility Fund and the Wastewater Utility Fund have revenue streams pledged in support of outstanding revenue bonds but since both segments are discretely presented in the proprietary fund financial statements, all required segment information is presented on the face of those statements. 85 86 Required Supplementary Information CITY OF PEORIA, ARIZONA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF THE CITY'S PROPORTIONATE SHARE OF THE NET PENSION/OPEB LIABILITY COST-SHARING PLANS JUNE 30, 2023 ASRS-Pension Proportion of the net pension liability Proportionate share of the net pension liability Covered payroll Proportionate share of the net pension liability as a percentage of its employee payroll Plan fiduciary net position as a percentage of the total pension liability Reporting Fiscal Year (Measurement Date) 2023 (2022) 2022 (2021) 2021 (2020) 2020 (2019) 0.514220% $ 83,932,124 $ 63,959,887 0.512820% $ 67,382,271 $ 57,978,944 0.523230% $ 90,657,551 $ 57,428,297 0.532380% $ 77,467,484 $ 56,417,665 131.23% 74.26% 116.22% 78.58% 157.86% 69.33% 137.31% 73.24% 2019 (2018) $ $ 0.546250% 76,182,651 54,343,055 2018 (2017) 0.571460% 89,022,329 53,419,833 $ $ 140.19% 73.40% 2017 (2016) $ $ 166.65% 69.92% NOTE: The pension schedules in the required supplementary information are intended to show information for ten years and additional information will be displayed as it becomes available. ASRS-Health insurance premium benefit Proportion of the net OPEB (assset) Proportionate share of the net OPEB (asset) Covered payroll Proportionate share of the net OPEB (asset) as a percentage of its employee payroll Plan fiduciary net position as a percentage of the total OPEB liability Reporting Fiscal Year (Measurement Date) 2023 (2022) 2022 (2021) 2021 (2020) 2020 (2019) 0.523820% $ (2,923,429) $ 63,959,887 0.522130% $ (2,543,860) $ 57,978,944 0.532290% $ (376,859) $ 57,428,297 0.541370% $ (149,610) $ 56,417,665 -4.57% 137.79% -4.39% 130.24% -0.66% 104.33% -0.27% 101.62% 2019 (2018) $ $ 0.554120% (199,533) 54,343,055 2018 (2017) $ $ -0.37% 102.20% 0.577940% (314,630) 53,419,833 -0.59% 103.57% NOTE: The health insurance premium benefit schedules in the required supplementary information are intended to show information for ten years and additional information will be displayed as it becomes available. ASRS-Long-term disability Proportion of the net OPEB liability Proportionate share of the net OPEB liability Covered payroll Proportionate share of the net OPEB liability as a percentage of its employee payroll Plan fiduciary net position as a percentage of the total OPEB liability Reporting Fiscal Year (Measurement Date) 2023 (2022) 2022 (2021) 2021 (2020) 2020 (2019) 0.517680% $ 47,813 $ 63,959,887 0.517490% $ 106,822 $ 57,978,944 0.528200% $ 400,699 $ 57,428,297 0.537820% $ 350,360 $ 56,417,665 0.07% 95.40% 0.18% 90.38% 0.70% 68.01% 0.62% 72.85% 2019 (2018) $ $ 0.550920% 287,858 54,343,055 0.53% 77.83% 2018 (2017) $ $ 0.569260% 206,344 53,419,833 0.39% 84.44% NOTE: The long‐term disability benefit schedules in the required supplementary information are intended to show information for ten years and additional information will be displayed as it becomes available. See accompanying notes to pension/OPEB plan schedules 87 0.542460% 87,558,493 50,820,065 172.29% 67.06% 2016 (2015) $ $ 2015 (2014) 0.526670% 82,036,552 47,561,194 0.520455% $ 77,009,675 $ 46,266,286 172.49% 68.35% 166.45% 69.49% CITY OF PEORIA, ARIZONA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF CHANGES IN NET PENSION LIABILITY AND RELATED RATIOS AGENT-EMPLOYER PLANS JUNE 30, 2023 Reporting Fiscal Year (Measurement Date) Public Safety Personnel Retirement System Peoria Police Department Total pension liability Service cost Interest on the total pension liability Changes in benefit terms Differences between expected and actual experience in the measurement of the pension liability Changes of assumptions or other inputs Benefit payments, including refunds of employee contributions Net change in total pension liability Total pension liability - beginning Total pension liability - ending (a) Plan fiduciary net position Contributions - employer Contributions - employee Net investment income Benefit payments, including refunds of employee contributions Hall/Parker Settlement Administrative expense Other changes Net change in plan fiduciary net position Plan fiduciary net position - beginning Adjustment to beginning of year Plan fiduciary net position - ending (b) Net pension liability - ending (a)-(b) Plan fiduciary net position as a percentage of the total pension liability Covered payroll Net pension liability as a percentage of covered payroll 2023 (2022) 2022 (2021) 2021 (2020) $ $ $ 3,355,365 11,719,465 - 3,403,053 11,102,550 - 3,529,413 10,379,460 - 2020 (2019) $ 3,517,607 9,742,131 - 2019 (2018) $ 3,437,849 9,195,638 - 2018 (2017) $ 3,497,564 8,207,737 1,019,089 $ 2017 (2016) 2016 (2015) 2015 (2014) 2,658,484 7,450,121 6,569,592 $ 2,557,053 7,075,581 - $ 2,556,976 6,074,980 1,228,208 1,419,354 1,677,907 749,764 - 2,182,003 - (152,876) 3,131,115 (1,331,798) - 5,141,159 2,469,996 (1,372,059) 4,270,128 341,776 - (672,105) 8,103,978 (7,136,011) 11,036,080 160,753,257 $ 171,789,337 (6,377,577) 8,877,790 151,875,467 $ 160,753,257 (5,740,752) 10,350,124 141,525,343 $ 151,875,467 (5,690,900) 10,547,077 130,978,266 $ 141,525,343 (5,739,761) 5,561,928 125,416,338 $ 130,978,266 (5,213,832) 15,121,713 110,294,625 $ 125,416,338 (5,716,802) 13,859,464 96,435,161 $ 110,294,625 (4,791,028) 5,183,382 91,251,779 $ 96,435,161 (4,300,112) 12,991,925 78,259,854 $ 91,251,779 $ 35,785,241 1,317,660 (4,957,000) $ $ $ $ $ $ 4,729,872 1,732,502 320,234 $ 3,254,563 1,689,030 1,821,818 $ 2,907,800 1,491,406 5,954,387 (7,136,011) (89,216) 11,388 24,932,062 102,880,751 $ 127,812,813 (6,377,577) (106,627) 25,833,349 77,047,402 $ 102,880,751 (5,740,752) (81,409) 3,950,596 73,096,802 4 $ 77,047,402 (5,690,900) (68,704) (4,128) 6,808,601 66,335,122 (46,921) $ 73,096,802 (5,739,761) (2,283,693) (65,122) 40,695 4,186,708 62,148,414 $ 66,335,122 (5,213,832) (59,988) (21,848) 9,285,039 52,863,375 $ 62,148,414 (5,716,802) (46,480) 37,100 1,056,426 51,806,949 $ 52,863,375 (4,791,028) (44,835) (56,762) 1,872,786 49,934,163 $ 51,806,949 (4,300,112) (1,313,936) 4,739,545 45,194,618 $ 49,934,163 43,976,524 57,872,506 74,828,065 68,428,541 64,643,144 63,267,924 57,431,250 44,628,212 41,317,616 74.40% 64.00% 50.73% 51.65% 50.65% 49.55% 47.93% 53.72% 54.72% $ 17,697,415 $ 16,653,104 $ 17,044,648 $ 16,897,694 $ 16,153,506 $ 15,387,963 $ 13,992,947 $ 13,449,859 $ 13,035,510 248.49% 347.52% 439.01% 404.96% 400.18% 411.15% 410.43% 331.81% 316.96% 8,091,143 1,323,822 22,902,588 7,327,021 1,447,635 998,101 7,419,726 1,254,178 3,898,429 6,622,615 1,379,152 4,232,822 5,122,411 2,723,948 6,734,348 NOTE: The pension schedules in the required supplementary information are intended to show information for ten years and additional information will be displayed as it becomes available. See accompanying notes to pension/OPEB plan schedules 88 CITY OF PEORIA, ARIZONA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF CHANGES IN NET PENSION LIABIILTY AND RELATED RATIOS AGENT-EMPLOYER PLANS JUNE 30, 2023 Public Safety Personnel Retirement System Peoria Fire Department Total pension liability Service cost Interest on the total pension liability Changes in benefit terms Differences between expected and actual experience in the measurement of the pension liability Changes of assumptions or other inputs Benefit payments, including refunds of employee contributions Net change in total pension liability Total pension liability - beginning Total pension liability - ending (a) Plan fiduciary net position Contributions - employer Contributions - employee Net investment income Benefit payments, including refunds of employee contributions Hall/Parker Settlement Administrative expense Other changes Net change in plan fiduciary net position Plan fiduciary net position - beginning Adjustment to beginning of year Plan fiduciary net position - ending (b) Net pension liability - ending (a)-(b) Plan fiduciary net position as a percentage of the total pension liability Covered payroll Net pension liability as a percentage of covered payroll Reporting Fiscal Year (Measurement Date) 2023 (2022) 2022 (2021) 2021 (2020) $ $ $ 3,710,281 9,592,431 - 3,318,890 8,884,264 - 3,259,480 8,199,149 - 2020 (2019) $ 3,230,796 7,557,042 - 2019 (2018) $ 3,070,924 7,066,051 - 2018 (2017) $ 3,111,892 6,395,230 466,111 $ 2017 (2016) 2016 (2015) 2015 (2014) 2,379,652 5,434,649 6,700,272 $ 2,056,517 4,952,998 - $ 2,013,025 4,197,224 453,523 4,163,638 1,398,720 1,734,765 - 2,094,984 - 1,198,203 2,087,419 (1,450,577) - 1,834,916 1,708,934 86,478 3,273,059 809,490 - 660,641 3,815,327 (5,016,815) 13,848,255 130,201,295 $ 144,049,550 (4,239,948) 9,697,971 120,503,324 $ 130,201,295 (4,215,838) 9,337,775 111,165,549 $ 120,503,324 (3,598,608) 10,474,852 100,690,697 $ 111,165,549 (3,894,840) 4,791,558 95,899,139 $ 100,690,697 (2,663,473) 10,853,610 85,045,529 $ 95,899,139 (1,739,905) 16,134,205 68,911,324 $ 85,045,529 (1,949,881) 5,869,124 63,042,200 $ 68,911,324 (1,117,704) 10,022,036 53,020,164 $ 63,042,200 $ 14,331,947 1,401,092 (4,380,045) $ $ $ $ $ $ 3,162,518 1,375,202 298,901 $ 1,866,365 1,238,541 1,710,692 $ 1,885,422 1,168,186 5,369,649 (5,016,815) (78,925) 6,257,254 101,860,154 $ 108,117,408 (4,239,948) (102,023) (108) 27,626,042 74,234,112 $ 101,860,154 (4,215,838) (78,924) 2,986,160 71,247,948 4 $ 74,234,112 (3,598,608) (65,997) 5,874,917 65,392,298 (19,267) $ 71,247,948 (3,894,840) (1,926,795) (64,663) 44,976 4,553,751 60,838,547 $ 65,392,298 (2,663,473) (57,251) 671 8,895,042 51,943,505 $ 60,838,547 (1,739,905) (43,410) 87,273 3,140,579 48,802,926 $ 51,943,505 (1,949,881) (42,126) (35,356) 2,788,235 46,014,691 $ 48,802,926 (1,117,704) (1,063,021) 6,242,532 39,772,159 $ 46,014,691 35,932,142 28,341,141 46,269,212 39,917,601 35,298,399 35,060,592 33,102,024 20,108,398 17,027,509 8,624,902 1,412,514 21,930,705 5,095,674 1,217,298 967,950 4,632,927 1,165,663 3,740,932 4,749,672 1,439,943 4,205,458 3,596,394 1,593,634 6,425,067 75.06% 78.23% 61.60% 64.09% 64.94% 63.44% 61.08% 70.82% 72.99% $ 17,385,094 $ 13,051,041 $ 13,658,235 $ 13,822,178 $ 12,085,624 $ 11,543,146 $ 11,796,929 $ 11,068,029 $ 10,934,868 206.68% 217.16% 338.76% 288.79% 292.07% 303.74% 280.60% 181.68% 155.72% NOTE: The pension schedules in the required supplementary information are intended to show information for ten years and additional information will be displayed as it becomes available. See accompanying notes to pension/OPEB plan schedules 89 CITY OF PEORIA, ARIZONA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF CHANGES IN NET OPEB LIABILITY AND RELATED RATIOS AGENT-EMPLOYER PLANS JUNE 30, 2023 Reporting Fiscal Year (Measurement Date) Public Safety Personnel Retirement System Peoria Police Department Total OPEB liability Service cost Interest on the total OPEB liability Changes in benefit terms Differences between expected and actual experience in the measurement of the OPEB liability Changes of assumptions or other inputs Benefit payments, including refunds of employee contributions Net change in total OPEB liability Total OPEB liability - beginning Total OPEB liability - ending (a) Plan fiduciary net position Contributions - employer Contributions - employee Net investment income Benefit payments, including refunds of employee contributions Administrative expense Other changes Net change in plan fiduciary net position Plan fiduciary net position - beginning Adjustment to beginning of year Plan fiduciary net position - ending (b) 2023 (2022) 2022 (2021) 2021 (2020) $ $ $ $ $ $ 60,471 154,251 - 64,399 163,960 - 66,728 153,939 - 2020 (2019) $ 44,231 167,216 - 2019 (2018) $ 45,757 164,184 - 2018 (2017) $ 50,779 167,590 6,476 (84,366) 48,624 (271,397) - 35,618 - (351,117) 25,181 (103,677) - 19,591 (159,009) (83,482) 95,498 2,094,294 2,189,792 (88,596) (131,634) 2,225,928 2,094,294 (87,770) 168,515 2,057,413 2,225,928 (87,095) (201,584) 2,258,997 2,057,413 (86,192) 20,072 2,238,925 2,258,997 (111,290) (25,863) 2,264,788 2,238,925 53,232 (104,779) (83,482) (1,865) (136,894) 2,690,418 2,553,524 $ $ $ 52,644 581,519 (88,596) (2,391) 543,176 2,147,242 2,690,418 $ $ $ 56,957 26,801 (87,770) (2,179) (6,191) 2,153,433 2,147,242 $ $ $ 59,304 109,070 (87,095) (1,883) 79,396 2,027,116 46,921 2,153,433 $ $ $ 31,038 134,052 (86,192) (2,040) (1) 76,857 1,950,259 2,027,116 $ $ $ 66,083 208,162 (111,290) (1,842) 161,113 1,789,146 1,950,259 Net OPEB liability/(asset) - ending (a)-(b) (363,732) (596,124) 78,686 (96,020) 231,881 288,666 Plan fiduciary net position as a percentage of the total OPEB liability 116.61% 128.46% 96.47% 104.67% 89.74% 87.11% $ 17,697,415 $ 16,653,104 $ 17,044,648 $ 16,897,694 $ 16,153,506 $ 15,387,963 -2.06% -3.58% 0.46% -0.57% 1.44% 1.88% Covered payroll Net OPEB liability/(asset) as a percentage of covered payroll NOTE: The OPEB schedules in the required supplementary information are intended to show information for ten years and additional information will be displayed as it becomes available. See accompanying notes to pension/OPEB plan schedules 90 CITY OF PEORIA, ARIZONA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF CHANGES IN NET OPEB LIABILITY AND RELATED RATIOS AGENT-EMPLOYER PLANS JUNE 30, 2023 Reporting Fiscal Year (Measurement Date) Public Safety Personnel Retirement System Peoria Fire Department Total OPEB liability Service cost Interest on the total OPEB liability Changes in benefit terms Differences between expected and actual experience in the measurement of the OPEB liability Changes of assumptions or other inputs Benefit payments, including refunds of employee contributions Net change in total OPEB liability Total OPEB liability - beginning Total OPEB liability - ending (a) Plan fiduciary net position Contributions - employer Contributions - employee Net investment income Benefit payments, including refunds of employee contributions Administrative expense Other changes Net change in plan fiduciary net position Plan fiduciary net position - beginning Adjustment to beginning of year Plan fiduciary net position - ending (b) 2023 (2022) 2022 (2021) 2021 (2020) $ $ $ $ $ $ 56,633 129,786 - 54,849 133,505 - 54,365 130,735 - 2020 (2019) $ 35,268 134,427 - 2019 (2018) $ 35,268 128,515 - 2018 (2017) $ 39,357 119,494 5,572 (157,630) 14,185 (184,074) - (63,904) - (193,678) 16,414 (49,429) - 175,598 (140,066) (56,491) (13,517) 1,749,499 1,735,982 (57,545) (53,265) 1,802,764 1,749,499 (61,508) 59,688 1,743,076 1,802,764 (61,324) (68,893) 1,811,969 1,743,076 (42,867) 71,487 1,740,482 1,811,969 (66,108) 133,847 1,606,635 1,740,482 41,562 (90,772) (56,491) (1,616) (107,317) 2,326,291 2,218,974 $ $ $ 48,285 499,969 (57,545) (2,056) 488,653 1,837,638 2,326,291 $ $ $ 38,836 22,949 (61,508) (1,866) (1,589) 1,839,227 1,837,638 $ $ $ 37,857 94,227 (61,324) (1,627) 69,133 1,750,826 19,268 1,839,227 $ $ 19,805 115,059 $ $ (42,867) (1,751) 90,246 1,660,580 $ 1,750,826 31,072 176,536 (66,108) (1,563) 139,937 1,520,643 $ 1,660,580 Net OPEB liability/(asset) - ending (a)-(b) (482,992) (576,792) (34,874) (96,151) 61,143 79,902 Plan fiduciary net position as a percentage of the total OPEB liability 127.82% 132.97% 101.93% 105.52% 96.63% 95.41% $ 17,385,094 $ 13,051,041 $ 13,658,235 $ 13,822,178 $ 12,085,624 $ 11,543,146 -2.78% -4.42% -0.26% -0.70% 0.51% 0.69% Covered payroll Net OPEB liability/(asset) as a percentage of covered payroll NOTE: The OPEB schedules in the required supplementary information are intended to show information for ten years and additional information will be displayed as it becomes available. See accompanying notes to pension/OPEB plan schedules 91 CITY OF PEORIA, ARIZONA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PENSION/OPEB CONTRIBUTIONS JUNE 30, 2023 2023 2022 2021 2020 2019 Reporting Fiscal Year 2018 2017 2016 2015 2014 Arizona State Retirement System - Pension Statutorily required contribution Actual contributions in relation to the statutorily required contribution Contribution deficiency (excess) Covered payroll Actual contribution as a percentage of covered payroll $ 7,956,550 $ 7,387,367 $ 6,696,568 $ 6,575,540 $ 6,307,495 $ 5,923,393 $ 5,513,977 $ 5,458,945 $ 5,019,946 $ $ 5,458,945 47,561,194 5,019,946 $ $ 46,266,286 11.48% 10.85% 7,387,367 $ $ 63,959,887 6,696,568 $ $ 57,978,944 6,575,540 $ $ 57,428,297 6,307,495 $ $ 56,417,665 5,923,393 $ $ 54,343,055 5,758,658 $ $ 53,419,833 5,513,977 $ $ 50,820,065 12.03% 12.01% 11.55% 11.45% 11.18% 10.90% 10.78% 10.85% $ 73,427 $ 129,172 $ 284,095 $ 281,400 $ 259,521 $ 239,109 73,427 $ $ 66,139,235 129,172 $ $ 63,959,887 284,095 $ $ 57,978,944 281,400 $ $ 57,428,297 259,521 $ $ 56,417,665 239,109 $ $ 54,343,055 0.11% 0.21% 0.49% 0.49% 0.46% 0.44% Arizona State Retirement System - Long-term disability Statutorily required contribution Actual contributions in relation to the statutorily required contribution Contribution deficiency (excess) Covered payroll Actual contribution as a percentage of covered payroll 5,758,658 7,956,550 $ $ 66,139,235 Arizona State Retirement System - Health Insurance Statutorily required contribution Actual contributions in relation to the statutorily required contribution Contribution deficiency (excess) Covered payroll Actual contribution as a percentage of covered payroll $ $ 93,446 $ 116,867 $ 104,363 $ 97,627 $ 90,268 $ 86,949 93,446 $ $ 66,139,235 116,867 $ $ 63,959,887 104,363 $ $ 57,978,944 97,627 $ $ 57,428,297 90,268 $ $ 56,417,665 86,949 $ $ 54,343,055 0.14% 0.19% 0.18% 0.17% 0.16% 0.16% See accompanying notes to pension plan schedules 92 CITY OF PEORIA, ARIZONA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF PENSION/OPEB CONTRIBUTIONS JUNE 30, 2023 Public Safety Personnel Retirement System - Pension 2023 Peoria Police Department Statutorily required contribution Actual contributions in relation to the statutorily required contribution Contribution deficiency (excess) Covered payroll Actual contribution as a percentage of covered payroll Peoria Fire Department Statutorily required contribution Actual contributions in relation to the statutorily required contribution Contribution deficiency (excess) Covered payroll Actual contribution as a percentage of covered payroll $ 5,039,558 $ 4,406,379 5,039,558 $ $ 15,387,963 4,696,546 $ (290,167) $ 13,992,947 61.77% 204.17% 49.71% 44.86% 44.01% 41.07% 32.75% 33.56% 2,711,485 $ 2,568,191 $ 7,646,229 5,881,182 $ $ 7,436,675 4,714,745 $ $ 8,917,938 5,721,681 $ $ 11,224,720 $ (4,985,724) $ 18,173,597 14,195,735 $ (7,832,791) $ 17,385,094 7,563,149 $ (2,786,468) $ 13,051,041 5,881,182 $ $ 13,658,235 4,714,745 $ $ 13,822,178 3,794,886 $ 1,926,795 $ 12,085,624 2,976,968 $ (265,483) $ 11,543,146 2,747,609 $ (179,418) $ 11,796,929 61.76% 81.65% 57.95% 43.06% 34.11% 31.40% 25.79% 23.29% Public Safety Personnel Retirement System - OPEB Peoria Police Department Statutorily required contribution Actual contributions in relation to the statutorily required contribution Contribution deficiency (excess) Covered payroll Actual contribution as a percentage of covered payroll Peoria Fire Department Statutorily required contribution Actual contributions in relation to the statutorily required contribution Contribution deficiency (excess) Covered payroll Actual contribution as a percentage of covered payroll 2016 6,634,245 $ 2,283,693 $ 16,153,506 4,776,681 $ 2017 7,436,675 $ $ 16,897,694 $ 7,806,975 Reporting Fiscal Year 2018 7,646,229 $ $ 17,044,648 6,362,944 $ 2019 8,278,054 $ (471,079) $ 16,653,104 $ 8,296,548 2020 36,132,348 $ (27,835,800) $ 17,697,415 6,238,996 $ 2021 11,695,201 $ (2,564,281) $ 18,932,033 $ 9,130,920 2022 $ 39,757 $ 61,941 $ 55,479 $ 59,656 $ 65,900 $ 79,152 39,757 $ $ 18,932,033 61,941 $ $ 17,697,415 58,825 $ (3,346) $ 16,653,104 59,656 $ $ 17,044,648 65,900 $ $ 16,897,694 79,152 $ $ 16,153,506 0.21% 0.35% 0.35% 0.35% 0.39% 0.49% $ 30,895 $ 45,201 $ 33,933 $ 51,931 $ 38,702 $ 35,048 30,895 $ $ 18,173,597 45,201 $ $ 17,385,094 53,727 $ (19,794) $ 13,051,041 51,931 $ $ 13,658,235 38,702 $ $ 13,822,178 35,048 $ $ 12,085,624 0.17% 0.26% 0.41% 0.38% 0.28% 0.29% NOTE: The pension/OPEB schedules in the required supplementary information are intended to show information for ten years and additional information will be displayed as it becomes available. See accompanying notes to pension plan schedules 93 2015 2014 $ 3,235,398 $ 2,907,800 $ $ 3,235,398 13,449,859 2,907,800 $ $ 13,035,510 24.06% 22.31% $ 1,842,016 $ 1,885,422 $ $ 1,842,016 11,068,029 1,885,422 $ $ 10,934,868 16.64% 17.24% CITY OF PEORIA, ARIZONA REQUIRED SUPPLEMENTARY INFORMATION NOTES TO PENSION/OPEB PLAN SCHEDULES JUNE 30, 2023 Note 1 – Actuarially Determined Contribution Rates Actuarial determined contribution rates for PSPRS are calculated as of June 30 two years prior to the end of the fiscal year in which contributions are made. The actuarial methods and assumptions are disclosed in the notes to the financial statements. Note 2- Factors that Affect Trends Arizona State Retirement System (ASRS) The actuarial assumptions used in the June 30, 2022, valuation for ASRS were based on the results of an actuarial experience study for the five-year period ended June 30, 2020. The ASRS Board adopted the experience study recommended changes which were applied to the June 30, 2021 actuarial valuation. Public Safety Personnel Retirement System (PSPRS) The actuarial assumptions used in the June 30, 2022, valuation for PSPRS were based on the results of an actuarial experience study, dated April 21, 2022. Several actuarial assumptions were adjusted based on the study. Adjustments included:  Decreasing wage inflation from 3.0% to 2.5%.  Decreasing the investment rate of return from 7.3 percent to 7.2 percent. Arizona courts have ruled that provisions of a 2011 law that changed the mechanism for funding permanent pension benefit increases and increased employee pension contribution rates were unconstitutional or a breach of contract because those provisions apply to individuals who were members as of the law’s effective date. As a result, the PSPRS changed benefit terms to reflect the prior mechanism for funding permanent benefit increases for those members and revised actuarial assumptions to explicitly value future permanent benefit increases. PSPRS also reduced those members’ employee contribution rates. These changes are reflected in the plans’ pension liabilities for fiscal year 2015 (measurement date 2014) for members who were retired as of the law’s effective date and fiscal year 2018 (measurement date 2017) for members who retired or will retire after the law’s effective date. These changes also increased the PSPRS-required pension contributions beginning in fiscal year 2016 for members who were retired as of the law’s effective date. These changes increased the PSPRS-required contributions beginning in fiscal year 2019 for members who retired or will retire after the law’s effective date. 94 Combining Statements & Budgetary Schedule Combining Fund Financial Statements and Budgetary Schedules This section contains the combining financial statements for non-major governmental funds, internal service funds and fiduciary funds as well as the budget schedules other than those for the general fund and major special revenue funds (which may be found immediately following the governmental fund financial statements). Page Major Governmental Funds Other than General Fund & Special Revenue Funds Budgetary Comparison Schedules General Obligation Bonds Debt Service Fund Development Fee Fund Non-Bond Capital Projects Fund 97 98 99 Non-Major Governmental Funds Combining Statements Combining Balance Sheet 102 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances 104 Budgetary Comparison Schedules Public Transit Fund 106 Other Grant Fund 107 Smart and Safe Arizona Fund 108 Municipal Development Authority (MDA) Debt, Debt Service Fund 109 Community Facilities District (CFD) Bonds Debt Service Fund 110 Non-Bond Debt Service Fund 111 Community Facilities District (CFD) Bonds Capital Projects Fund 112 General Obligation Bonds Capital Projects Fund 113 Internal Service Funds Combining Statements Combining Statement of Net Position 115 Combining Statement of Revenues, Expenses, and Changes in Fund Net Position 116 Combining Statement of Cash Flows 117 Fiduciary Funds Combining Statements Combining Statement of Net Position Combining Statement of Changes in Fiduciary Net Position 95 119 120 MAJOR GOVERNMENTAL FUNDS OTHER THAN GENERAL FUND & SPECIAL REVENUE FUNDS Budgetary Comparison Schedules Debt Service Funds Debt service funds are used to account for and report financial resources that are restricted, committed, or assigned to expenditure for principal and interest payments on debt. This includes financial resources that are being accumulated for principal and interest maturing in future years. Principal payments are due annually. Interest is due semiannually. General Obligation (GO) Bonds Debt Service Fund This fund accounts for the principal and interest requirements of the City's general obligation bonds. Provisions are made in the City's general property tax levy for funds sufficient to meet the general obligation debt service. Capital Projects Funds A capital project fund is established to account for the acquisition and construction of major capital facilities other than those financed by Special Revenue Fund and Enterprise Fund resources. A capital project fund enhances reporting to ensure that requirements regarding the use of the revenue were fully satisfied. Development Fee Fund This fund accounts for the receipt and expenditure of development impact or expansion fees for all governmental activities as governed by state statutes. Non-Bond Capital Projects Fund This fund accounts for the purchase or construction of capital assets with funds other than bond proceeds. This includes monies received from outside sources, i.e. developers or other governments, and also City pay-as-you-go monies. 96 CITY OF PEORIA, ARIZONA BUDGETARY COMPARISON SCHEDULE GENERAL OBLIGATION BONDS DEBT SERVICE FUND FOR THE YEAR ENDED JUNE 30, 2023 Variance with REVENUES: Taxes Investment earnings(loss) Total revenues $ EXPENDITURES: Debt service: Principal payments Interest and other charges Total expenditures Excess (deficiency) of revenues over (under) expenditures Net change in fund balances Fund balances - beginning Fund balances - ending $ Actual Final Budget Budgeted Amounts Original Final Amounts (budgetary basis) Over (Under) 21,989,530 30,000 22,019,530 $ $ 21,989,530 30,000 22,019,530 21,937,922 45,844 21,983,766 $ (51,608) 15,844 (35,764) 18,139,906 8,411,337 26,551,243 18,139,906 8,411,337 26,551,243 16,844,188 5,746,514 22,590,702 (1,295,718) (2,664,823) (3,960,541) (4,531,713) (4,531,713) (606,936) 3,924,777 (4,531,713) (4,531,713) (606,936) 3,924,777 14,399,108 14,399,108 19,673,341 5,274,233 9,867,395 97 $ 9,867,395 $ 19,066,405 $ 9,199,010 CITY OF PEORIA, ARIZONA BUDGETARY COMPARISON SCHEDULE DEVELOPMENT FEE FUND FOR THE YEAR ENDED JUNE 30, 2023 Budgeted Amounts Original Final REVENUES: Charges for services Investment earnings(loss) Total revenues $ EXPENDITURES: Current: Culture and recreation Public safety Highways and streets Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES): Contingencies Total other financing sources and uses Net change in fund balances Fund balances - beginning Fund balances - ending $ 14,190,951 202,340 14,393,291 $ 14,190,951 202,340 14,393,291 Variance with Final Budget Over (Under) Actual Amounts (budgetary basis) $ 4,000,711 631,893 4,632,604 $ (10,190,240) 429,553 (9,760,687) 15,679 4,984,321 11,683,438 16,683,438 15,679 5,330,664 9,993,253 15,339,596 1,317 3,292 1,413,276 86,081 1,503,966 (14,362) 3,292 (3,917,388) (9,907,172) (13,835,630) (2,290,147) (946,305) 3,128,638 4,074,943 (3,000,000) (3,000,000) (1,071,776) (1,071,776) (5,290,147) (2,018,081) 3,128,638 5,146,719 $31,536,029 31,536,029 37,709,451 6,173,422 26,245,882 98 $ 29,517,948 - $ 40,838,089 1,071,776 1,071,776 $ 11,320,141 CITY OF PEORIA, ARIZONA BUDGETARY COMPARISON SCHEDULE NON-BOND CAPITAL PROJECTS FUND FOR THE YEAR ENDED JUNE 30, 2023 Budgeted Amounts Original Final REVENUES: Intergovernmental revenue Charges for Services Investment earnings Miscellaneous Total revenues $ EXPENDITURES: Current: Highways and streets Public Works Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES): Issuance of debt Transfers out Total other financing sources and uses $ $ 2,500,000 94,010 32,653,295 35,247,305 Variance with Final Budget Over (Under) $ $ 2,074,991 426,771 2,501,762 (2,500,000) 2,074,991 332,761 (32,653,295) (32,745,543) 39,308,367 39,308,367 175,219 24,932,237 25,107,456 503,692 322,033 3,625,241 4,450,966 328,473 322,033 (21,306,996) (20,656,490) (4,061,062) 10,139,849 (1,949,204) (12,089,053) - 64,165 64,165 (64,124) (64,124) (64,165) (64,124) (128,289) (4,061,062) 10,204,014 (2,013,328) (12,217,342) - Net change in fund balances Fund balances - beginning Fund balances - ending 2,500,000 94,010 32,653,295 35,247,305 Actual Amounts (budgetary basis) 15,357,581 11,296,519 99 $ 15,357,581 25,561,595 $ 13,112,425 11,099,097 $ (2,245,156) (14,462,498) NON-MAJOR GOVERNMENTAL FUNDS OTHER GOVERNMENTAL FUNDS Special Revenue Funds Special revenue funds are used to account for and report the proceeds of specific revenue sources that are restricted or committed to expenditure for specified purposes other than debt service or capital projects. Public Transit Fund This fund receives and expends the City's allocation of Federal Transit Authority grant money as well as the City's allocation of the Local Transportation Assistance Fund money. The amount of Federal Transportation Authority funds available to each city is based on the total funding available and the total requests for funds. The amount of Local Transportation Assistance funds available to each city is allocated on a population basis, which is determined by the latest federal census. Expenditures are for the administration and operating costs of the public transit system. Other Grants Fund This fund receives and expends much of the City’s grant fund money. The amount of grants received is generally based upon application to granting agencies by the City and availability of funding by grantors. Grant money may be used only for the purpose of the approved budget and is subject to grantor expenditure guidelines. Smart & Safe AZ Fund This fund receives and expends the City's allocation of sales tax on recreational marijuana. These monies are deposited into the State’s Smart and Safe Arizona Fund (SSAF). The City receives a portion of this money from the state to be spent on police and fire departments. Debt Service Funds Debt service funds are used to account for and report financial resources that are restricted, committed, or assigned to expenditure for principal and interest payments on debt. This includes financial resources that are being accumulated for principal and interest maturing in future years. Principal payments are due annually. Interest is due semiannually. Municipal Development Authority (MDA) Bonds Debt Service Fund This fund accounts for the principal and interest requirements of the Municipal Development Authority's bonds. Provisions are made in the City's transaction privilege tax for funds sufficient to meet the Municipal Development Authority's debt service. Community Facilities District (CFD) Bonds Debt Service Fund This fund accounts for the principal and interest requirements of the Vistancia, Vistancia West, Vistancia North and Mystic at Lake Pleasant Heights Communities Facilities Districts (blended component units) general obligation bonds. Provisions are made in the District's general property tax levy for funds sufficient to meet the general obligation debt service. Non-Bond Debt Service Fund This fund accounts for all non-general obligation bond debt service payments of the City. 100 Capital Projects Funds A capital project fund is established to account for the acquisition and construction of major capital facilities other than those financed by Special Revenue Fund and Enterprise Fund resources. A capital project fund enhances reporting to ensure that requirements regarding the use of the revenue were fully satisfied. Community Facilities District (CFD) Bonds Capital Projects Fund This fund accounts for the expenditure of Vistancia, Vistancia West, Vistancia North and Mystic at Lake Pleasant Heights Communities Facilities Districts bond proceeds for the construction of capital assets for the District. Once the capital assets are completed, they are turned over to the City for operation and maintenance. General Obligation (GO) Bond Capital Projects Fund This fund accounts for the receipt of proceeds from General Obligation bonds and the expenditure of those funds to purchase or construct capital assets for the City. 101 CITY OF PEORIA, ARIZONA COMBINING BALANCE SHEET NON-MAJOR GOVERNMENTAL FUNDS JUNE 30, 2023 Special Revenue Funds Public Transit Fund ASSETS Pooled cash and investments Accounts receivable, net Interest receivable Due from other governments Prepaid items Restricted cash with fiscal agents Restricted investments Total assets LIABILITIES, DEFERRED INFLOWS AND FUND BALANCES Liabilities: Accounts payable Accrued payroll Due to other funds Due to other governments Other liabilities Unearned revenue-other Total liabilities Deferred inflows of resources: Unavailable revenue-property taxes Total deferred inflows of resources Fund balances: Unspendable: Prepaid items Restricted for: Debt service Capital projects Public safety Grant purposes Committed for: Arts capital Unassigned: Total fund balance Total liabilities, deferred inflows & fund balance $ $ $ $ 6,016,899 345,191 16,685 6,378,775 123,708 19,794 5,000 148,502 Other Grants Fund $ 9,911,520 208,599 39,012 677,301 427,970 $ 11,264,402 $ $ $ 495,157 28,420 10 (67) 6,977,128 7,500,648 $ Debt Service Funds Smart & Safe AZ Fund Municipal Development Authority Debt 2,088,565 2,088,565 $ 1,989 1,989 $ $ 3,037,180 9,370 3,046,550 - CFD Bonds $ $ $ Non-Bond 252,641 567 13,240 53,371 13,421 4,506,448 561,255 5,400,943 - $ $ $ 1,707 259 1,966 5,948 804,759 810,707 - - - - 567 567 - - - - - 13,421 - - - 6,230,273 1,681,733 2,086,576 - 6,230,273 2,082,021 3,763,754 2,086,576 6,378,775 $ 11,264,402 102 $ 2,088,565 $ 3,046,550 - 5,386,955 - - 3,046,550 5,400,376 (808,741) (808,741) 3,046,550 $ 5,400,943 $ 1,966 (continued) CITY OF PEORIA, ARIZONA COMBINING BALANCE SHEET NON-MAJOR GOVERNMENTAL FUNDS JUNE 30, 2023 Total Capital Project Funds CFD Bonds ASSETS Pooled cash and investments Accounts receivable, net Interest receivable Due from other governments Prepaid items Restricted cash with fiscal agents Restricted investments Total assets LIABILITIES, DEFERRED INFLOWS AND FUND BALANCES Liabilities: Accounts payable Accrued payroll Due to other funds Due to other governments Other liabilities Unearned revenue-other Total liabilities Deferred inflows of resources: Unavailable revenue-property taxes Total deferred inflows of resources Fund balances: Unspendable: Prepaid items Restricted for: Debt service Capital projects Public safety Grant purposes Committed for: Arts capital Unassigned: Total fund balance Total liabilities, deferred inflows & fund balance $ $ $ $ Non-Major Governmental Funds GO Bonds 1,562 5,420 347,234 354,216 $ 39,341 48,958,455 $ 48,997,796 $ 1,500 18,950 20,450 $ $ 5,421,744 1,474,932 299,498 7,196,174 $ 21,308,367 554,357 119,355 730,672 13,421 4,940,097 49,866,944 77,533,213 6,050,046 48,214 2,279,691 10 318,381 6,982,128 15,678,470 - - 567 567 - - 13,421 333,766 - 41,801,622 - 8,433,505 42,135,388 2,086,576 7,912,006 333,766 41,801,622 2,082,021 (808,741) 61,854,176 354,216 $ 48,997,796 103 $ 77,533,213 CITY OF PEORIA, ARIZONA COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NON-MAJOR GOVERNMENTAL FUNDS FOR THE YEAR ENDED JUNE 30, 2023 Public Transit Fund REVENUES: Taxes Intergovernmental Charges for service Fines and forfeitures Investment earnings(loss) Miscellaneous Total revenues EXPENDITURES: Current: General government Culture and recreation Public safety Development services Highways and streets Public works Human services Debt service: Principal payments Interest and other charges Capital outlay Total expenditures Excess (deficiency) of revenues over expenditures OTHER FINANCING SOURCES (USES): Issuance of debt Premium on bonds issued Transfers in Transfers out Total other financing sources and uses Net change in fund balances Fund balances - beginning Fund balances - ending $ Special Revenue Funds Other Smart & Grants Safe AZ Fund Fund 919,150 87,844 89,603 390,343 1,486,940 $ 12,873,103 767,209 135,875 217,799 528,410 14,522,396 $ 1,095,491 1,095,491 Debt Service Funds Municipal Development CFD Authority Debt Bonds Non-Bond $ 50,317 50,317 $ 5,350,716 71,096 221,590 5,643,402 $ 9,168 122,569 131,737 3,636,666 1,305,763 6,528,082 1,118,584 1,182,998 1,191,369 124,182 - - 70,286 - 17,648 - 3,636,666 290,886 11,617,682 124,182 - 4,030,000 852,685 4,952,971 4,353,485 1,250,321 5,621,454 (2,149,726) 2,904,714 971,309 50,317 690,431 (5,489,717) 3,277,000 3,277,000 (2,320,768) (2,320,768) - (11,763) (11,763) (72,558) (72,558) 4,274,737 4,274,737 1,127,274 583,946 971,309 38,554 617,873 (1,214,980) 5,102,999 $ 6,230,273 3,179,808 $ 3,763,754 1,115,267 $ 2,086,576 3,007,996 $ 3,046,550 4,782,503 $ 5,400,376 104 $ 406,239 (808,741) (continued) CITY OF PEORIA, ARIZONA COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NON-MAJOR GOVERNMENTAL FUNDS FOR THE YEAR ENDED JUNE 30, 2023 Capital Project Funds CFD Bonds REVENUES: Taxes Intergovernmental Charges for service Fines and forfeitures Investment earnings(loss) Miscellaneous Total revenues $ EXPENDITURES: Current: General government Culture and recreation Public safety Development services Highways and streets Public works Human services Debt service: Principal payments Interest and other charges Capital outlay Total expenditures Excess (deficiency) of revenues over expenditures OTHER FINANCING SOURCES (USES): Issuance of debt Premium on bonds issued Transfers in Transfers out Total other financing sources and uses Net change in fund balances Fund balances - beginning Fund balances - ending $ 434 434 GO Bonds $ 1,000,000 1,349,814 2,349,814 Total Non-Major Governmental Funds $ 5,350,716 15,887,744 855,053 135,875 1,788,231 1,262,912 25,280,531 3,284,848 - 267,268 85,042 228,519 1,304,098 1,257,759 - 4,928,165 6,613,124 1,471,285 1,182,998 1,304,098 1,275,407 4,828,035 377,395 3,662,243 223,481 14,966,659 18,332,826 8,383,485 2,703,882 15,257,545 47,948,024 (3,661,809) (15,983,012) (22,667,493) 3,625,000 23,294 72,558 3,720,852 28,083,075 1,524,166 (9,873,477) 19,733,764 31,708,075 1,547,460 7,624,295 (12,278,566) 28,601,264 59,043 3,750,752 5,933,771 274,723 333,766 $ 38,050,870 41,801,622 105 $ 55,920,405 61,854,176 CITY OF PEORIA, ARIZONA BUDGETARY COMPARISON SCHEDULE PUBLIC TRANSIT FUND FOR THE YEAR ENDED JUNE 30, 2023 Budgeted Amounts Original Final REVENUES: Intergovernmental Charges for services Investment earnings Miscellaneous Total inflows $ EXPENDITURES: Current: Human services Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES): Transfers in Total other financing sources and uses Net change in fund balances Fund balances - beginning Fund balances - ending $ 425,000 90,000 15,000 225,000 755,000 $ 425,000 90,000 15,000 225,000 755,000 Variance with Final Budget Over (Under) Actual Amounts (budgetary basis) $ 919,150 87,844 89,603 390,343 1,486,940 $ 494,150 (2,156) 74,603 165,343 731,940 4,560,916 4,560,916 4,557,150 4,557,150 3,636,666 3,636,666 (920,484) (920,484) (3,805,916) (3,802,150) (2,149,726) 1,652,424 3,277,000 3,277,000 3,277,000 3,277,000 3,277,000 3,277,000 (528,916) (525,150) 1,127,274 1,652,424 2,167,738 2,167,738 5,102,999 2,935,261 1,638,822 106 $ 1,642,588 $ 6,230,273 - $ 4,587,685 CITY OF PEORIA, ARIZONA BUDGETARY COMPARISON SCHEDULE OTHER GRANTS FUND FOR THE YEAR ENDED JUNE 30, 2023 Budgeted Amounts Original Final REVENUES: Intergovernmental Charges for services Fines and forfeitures Investment earnings Miscellaneous Total revenues $ EXPENDITURES: Current: General government Culture and recreation Public safety Development services Human Services Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES): Contingencies Transfers out Total other financing sources and uses Net change in fund balances Fund balances - beginning Fund balances - ending $ 7,745,325 450,000 159,798 58,485 7,528 8,421,136 $ 7,745,325 450,000 159,798 58,485 7,528 8,421,136 Variance with Final Budget Over (Under) Actual Amounts (budgetary basis) $ 12,873,103 767,209 135,875 217,799 528,410 14,522,396 $ 5,127,778 317,209 (23,923) 159,314 520,882 6,101,260 700,387 3,415,255 536,757 2,205,663 10,859,714 5,408,070 23,125,846 1,023,386 6,973,130 1,597,301 2,346,627 16,475,121 7,562,412 35,977,977 1,305,763 6,528,082 1,118,584 1,182,998 1,191,369 290,886 11,617,682 282,377 (445,048) (478,717) (1,163,629) (15,283,752) (7,271,526) (24,360,295) (14,704,710) (27,556,841) 2,904,714 30,461,555 (3,000,000) (225,327) (3,225,327) (225,327) (225,327) (2,320,768) (2,320,768) (2,095,441) (2,095,441) (17,930,037) (27,782,168) 583,946 28,366,114 20,119,767 20,119,767 3,179,808 (16,939,959) 2,189,730 $ (7,662,401) $ The accompanying notes are an integral part of the financial statements 107 3,763,754 $ 11,426,155 CITY OF PEORIA, ARIZONA BUDGETARY COMPARISON SCHEDULE SMART & SAFE AZ FUND FOR THE YEAR ENDED JUNE 30, 2023 Budgeted Amounts Original Final REVENUES: Intergovernmental revenue Total revenues $ EXPENDITURES: Current: Public Safety Total expenditures Excess (deficiency) of revenues over (under) expenditures Net change in fund balances Fund balances - beginning Fund balances - ending $ 980,000 980,000 $ 980,000 980,000 Actual Amounts (budgetary basis) Variance with Final Budget Over (Under) $ $ 1,095,491 1,095,491 115,491 115,491 139,086 139,086 139,086 139,086 124,182 124,182 (14,904) (14,904) 840,914 840,914 971,309 130,395 840,914 840,914 971,309 130,395 1,115,267 1,956,181 108 $ 1,115,267 1,956,181 $ 1,115,267 2,086,576 $ 130,395 CITY OF PEORIA, ARIZONA BUDGETARY COMPARISON SCHEDULE MUNICIPAL DEVELOPMENT AUTHORITY (MDA) DEBT, DEBT SERVICE FUND FOR THE YEAR ENDED JUNE 30, 2023 Budgeted Amounts Original Final REVENUES: Investment earnings Total revenues $ EXPENDITURES: Debt service: Principal payments Interest and other charges Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES): Transfers out Total other financing sources and uses $ Fund balances - beginning $ 25,000 25,000 $ 50,317 50,317 $ 25,317 25,317 2,285,000 877,526 3,162,526 - - - (3,137,526) 25,000 50,317 25,317 - (11,763) (11,763) (11,763) (11,763) (3,137,526) 25,000 38,554 13,554 5,280,602 5,280,602 3,007,996 (2,272,606) - Net change in fund balances Fund balances - ending 25,000 25,000 Variance with Final Budget Over (Under) Actual Amounts (budgetary basis) 2,143,076 109 $ 5,305,602 $ 3,046,550 $ (2,259,052) CITY OF PEORIA, ARIZONA BUDGETARY COMPARISON SCHEDULE COMMUNITY FACILITIES DISTRICT (CFD) BONDS DEBT SERVICE FUND FOR THE YEAR ENDED JUNE 30, 2023 Budgeted Amounts Original Final REVENUES: Taxes Charges For Service Investment earnings Miscellaneous Total revenues $ EXPENDITURES: Current: General government Debt service: Principal payments Interest and other charges Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES): Contingencies Transfers out Total other financing sources and uses Net change in fund balances Fund balances - beginning Fund balances - ending $ 5,371,815 $ Variance with Final Budget Over (Under) Actual Amounts (budgetary basis) 5,371,815 $ 5,350,716 $ (21,099) 1,175,740 6,547,555 1,175,740 6,547,555 71,096 221,590 5,643,402 71,096 (954,150) (904,153) 1,140,000 1,140,000 70,286 (1,069,714) 4,102,560 918,765 6,161,325 4,102,560 918,765 6,161,325 4,030,000 852,685 4,952,971 (72,560) (66,080) (1,208,354) 386,230 386,230 690,431 304,201 10,000 10,000 (10,000) (10,000) (72,558) (72,558) 10,000 (72,558) (62,558) 396,230 376,230 617,873 241,643 - - 4,782,503 4,782,503 396,230 110 $ 376,230 $ 5,400,376 $ 5,024,146 CITY OF PEORIA, ARIZONA BUDGETARY COMPARISON SCHEDULE NON-BOND DEBT SERVICE FUND FOR THE YEAR ENDED JUNE 30, 2023 Budgeted Amounts Original Final REVENUES: Investment earnings Miscellaneous Total revenues $ EXPENDITURES: Current: General government Public works Debt service: Principal payments Interest and other charges Total expenditures $ - Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES): Transfers in Total other financing sources and uses Net change in fund balances Fund balances - beginning Fund balances - ending 1,550 1,550 1,550 1,550 $ 9,168 122,569 131,737 $ 7,618 122,569 130,187 64,445 - 17,648 (64,445) 17,648 3,873,485 489,444 4,362,929 6,158,485 1,366,970 7,589,900 4,353,485 1,250,321 5,621,454 (1,805,000) (116,649) (1,968,446) (4,361,379) (7,588,350) (5,489,717) 2,098,633 4,198,850 4,198,850 4,198,850 4,198,850 4,274,737 4,274,737 75,887 75,887 (162,529) (3,389,500) (1,214,980) 2,174,520 406,239 406,239 $ Variance with Final Budget Over (Under) Actual Amounts (budgetary basis) - (162,529) 111 $ (3,389,500) $ (808,741) $ 2,580,759 CITY OF PEORIA, ARIZONA BUDGETARY COMPARISON SCHEDULE COMMUNITY FACILITIES DISTRICT (CFD) BONDS CAPITAL PROJECTS FUND FOR THE YEAR ENDED JUNE 30, 2023 Budgeted Amounts Original Final REVENUES: Investment earnings Total revenues $ EXPENDITURES: Current: General government Debt service: Interest and other charges Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES): Issuance of debt Premium on bonds issued Transfers in Total other financing sources and uses Net change in fund balances Fund balances - beginning Fund balances - ending - $ - $ 434 434 $ 434 434 - - 3,284,848 3,284,848 475,000 475,000 475,000 475,000 377,395 3,662,243 (97,605) 3,187,243 (475,000) (475,000) (3,661,809) (3,186,809) 5,075,000 5,075,000 5,075,000 5,075,000 3,625,000 23,294 72,558 3,720,852 (1,450,000) 23,294 72,558 (1,354,148) 4,600,000 4,600,000 59,043 (4,540,957) 274,723 274,723 $ Variance with Final Budget Over (Under) Actual Amounts (budgetary basis) 4,600,000 112 $ 4,600,000 $ 333,766 $ (4,266,234) CITY OF PEORIA, ARIZONA BUDGETARY COMPARISON SCHEDULE GENERAL OBLIGATION (GO) BOND CAPITAL PROJECTS FUND FOR THE YEAR ENDED JUNE 30, 2023 Budgeted Amounts Original Final REVENUES: Intergovernmental revenue Investment earnings(loss) Total revenues $ EXPENDITURES: Current: General government Culture and recreation Public safety Highways and streets Public works Debt service: Interest and other charges Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures OTHER FINANCING SOURCES (USES): Issuance of debt Premium on bonds issued Transfers out Total other financing sources and uses Net change in fund balances Fund balances - beginning Fund balances - ending $ 10,000 10,000 $ 10,000 10,000 Variance with Final Budget Over (Under) Actual Amounts (budgetary basis) $ 1,000,000 1,349,814 2,349,814 $ 1,000,000 1,339,814 2,339,814 780,305 - 759,150 - 267,268 85,042 228,519 1,304,098 1,257,759 267,268 85,042 228,519 544,948 1,257,759 65,700,388 66,480,693 62,037,765 62,796,915 223,481 14,966,659 18,332,826 223,481 (47,071,106) (44,464,089) (66,470,693) (62,786,915) (15,983,012) 46,803,903 42,844,104 42,844,104 64,505,092 64,505,092 28,083,075 1,524,166 (9,873,477) 19,733,764 (36,422,017) 1,524,166 (9,873,477) (44,771,328) (23,626,589) 1,718,177 3,750,752 2,032,575 30,318,445 30,318,445 38,050,870 7,732,425 6,691,856 113 $ 32,036,622 $ 41,801,622 $ 9,765,000 INTERNAL SERVICE FUNDS Motor Pool Fund The Motor Pool Fund is responsible for the maintenance and operation of the City’s fleet of vehicles and various other equipment. Self-Insurance Fund The Self-Insurance Fund is responsible for the administration of the self-insurance programs, including liability and property damage, workers’ compensation insurance, and employee health insurance. This fund provides the excess insurance coverage for claims over the self-insurance limits; claims under the limits are charged directly to the SelfInsurance Fund. Facilities Maintenance Fund The Facilities Maintenance Fund is responsible for the maintenance and operations of the City's buildings and grounds. Information Technology Fund The Information Technology Fund is responsible for the maintenance and operations of the City's computer hardware and software systems. 114 CITY OF PEORIA, ARIZONA COMBINING STATEMENT OF NET POSITION INTERNAL SERVICE FUNDS JUNE 30, 2023 ASSETS Current assets: Pooled cash and investments Restricted pooled cash and investments Restricted cash with fiscal agents Accounts receivable, net Interest receivable Supplies inventory Total current assets Non-current assets: Restricted assets: Investments Total restricted assets Capital assets: Buildings and improvements Equipment & furniture Vehicles Intangible-SBITA Less accumulated depreciation/amortization Construction in progress Total capital assets, net Net other postemployment benefits asset Total assets DEFERRED OUTFLOWS OF RESOURCES Deferred outflows related to pensions Total deferred outflows of resources LIABILITIES Current liabilities: Accounts payable Accrued payroll Accrued interest payable Other current liabilities Current portion of claims payable Current portion of compensated absences Current portion of SBITA payable Total current liabilities Non-current liabilities: Long-term portion of claims payable Compensated absences Long-term portion of SBITA payable Net pension and other postemployment benefits liability Total non-current liabilities Total liabilities DEFERRED INFLOWS OF RESOURCES Deferred inflows related to pensions Total deferred inflows of resources NET POSITION Net investment in capital assets Restricted - trust purpose Restricted - net other postemployment benefits Unrestricted Total net position Motor Pool Fund SelfInsurance Fund Facilities Maintenance Fund Information Technology Fund Total $ 15,818,148 3,575 49,961 262,762 16,134,446 $ 7,082,885 21,023,442 275,000 134,512 28,515,839 $ 2,065,518 13,492 2,079,010 $ 10,530,804 197 44,674 10,575,675 $ 35,497,355 21,023,442 275,000 3,772 242,639 262,762 57,304,970 - 8,643,595 8,643,595 1,048,125 37,780,745 (26,650,840) 2,111,626 14,289,656 39,120 30,463,222 177,178 177,178 - 37,159,434 - - 8,643,595 8,643,595 87,638 2,166,648 148,102 38,661,923 1,163,648 (39,434,562) 539,111 182,696 11,297,482 148,102 39,710,048 37,780,745 1,163,648 (66,085,402) 2,111,626 14,828,767 309,454 81,086,786 396,920 396,920 827,438 827,438 1,401,536 1,401,536 478,921 48,330 31 68,719 596,001 1,863,501 9,307 8,234,981 20,665 10,128,454 56,317 76,528 154,260 287,105 1,105,540 219,313 9,344 364,487 352,322 2,051,006 3,504,279 353,478 9,344 31 8,234,981 608,131 352,322 13,062,566 79,197 - 907,895 34,295 - 216,382 - 332,064 140,038 907,895 661,938 140,038 1,123,788 1,202,985 1,798,986 942,190 11,070,644 2,517,546 2,733,928 3,021,033 5,248,206 5,720,308 7,771,314 8,889,540 10,599,411 23,661,977 136,801 136,801 285,186 285,186 483,054 483,054 87,638 (681,904) (594,266) 46,751 182,696 3,838,973 $ 4,068,420 14,336,407 20,286,020 309,454 23,411,410 $ 58,343,291 61,067 61,067 14,289,656 39,120 14,451,571 $ 28,780,347 115 - 20,286,020 5,802,770 $ 26,088,790 $ CITY OF PEORIA, ARIZONA COMBINING STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET POSITION INTERNAL SERVICE FUNDS FOR THE YEAR ENDED JUNE 30, 2023 Facilities Maintenance Fund Information Technology Fund Total $ 7,172,788 32 7,172,820 $ 13,684,936 64,602 13,749,538 $ 59,647,214 541,673 60,188,887 451,396 1,524,800 27,429,874 29,406,070 (924,660) 2,806,036 3,763,307 6,569,343 603,477 5,848,607 7,929,852 1,271,582 15,050,041 (1,300,503) 10,466,827 19,302,437 27,429,874 4,666,193 61,865,331 (1,676,444) 268,299 66,512 334,811 539,330 539,330 72,454 72,454 239,900 (13,901) 225,999 1,119,983 (13,901) 66,512 1,172,594 280,053 (385,330) 675,931 (1,074,504) (503,850) Capital contributions Transfers in Transfers out Change in net position 616,962 754,857 (3,000) 1,648,872 (19,493) (404,823) 675,931 2,402,656 1,328,152 616,962 3,157,513 (22,493) 3,248,132 Total net position - beginning Total net position - ending 27,131,475 $ 28,780,347 26,493,613 $ 26,088,790 2,740,268 4,068,420 55,095,159 $ 58,343,291 OPERATING REVENUES Charges for services Miscellaneous Total operating revenues OPERATING EXPENSES Salaries, wages and employee benefits Contractual services, materials and supplies Insurance claims and expenses Depreciation and amortization Total operating expenses Operating income (loss) NON-OPERATING REVENUES (EXPENSES) Investment income(loss) Interest expense Gain (Loss) on sale of capital assets Total non-operating revenues Income (loss) before capital contributions and transfers Motor Pool Fund SelfInsurance Fund $ 10,739,215 45,904 10,785,119 $ 28,050,275 431,135 28,481,410 1,360,788 6,084,478 3,394,611 10,839,877 (54,758) 116 $ (1,270,197) (594,266) $ CITY OF PEORIA, ARIZONA COMBINING STATEMENT OF CASH FLOWS INTERNAL SERVICE FUNDS FOR THE YEAR ENDED JUNE 30, 2023 Motor Pool Fund SelfInsurance Fund $ 10,797,169 (5,668,972) (1,283,457) 3,844,740 $ 28,503,494 (2,413,550) (440,858) (25,237,798) 411,288 CASH FLOWS FROM NON-CAPITAL FINANCING ACTIVITIES Transfers in Transfers out Net cash provided (used) by non-capital financing activities 754,857 (3,000) 751,857 (19,493) (19,493) CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Acquisition and construction of capital assets Proceeds from disposal of capital assets Principal payments on SBITA agreements Interest payments on SBITA agreements Net cash flows used by capital and related financing activities (2,873,570) 89,982 (2,783,588) - CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers Payments to suppliers Payments to employees Self-insurance costs Net cash provided (used) by operating activities CASH FLOWS FROM INVESTING ACTIVITIES Purchase of investments Proceeds from sale of investments Interest received on investments Net cash provided by investing activities Facilities Maintenance Fund Information Technology Fund Total $ $ 13,757,338 (7,015,118) (5,613,988) 1,128,232 $ 60,230,821 (18,865,354) (10,376,856) (25,237,798) 5,750,813 - 2,402,656 2,402,656 3,157,513 (22,493) 3,135,020 - (671,576) (4,268) (675,844) (2,873,570) 89,982 (671,576) (4,268) (3,459,432) 7,172,820 (3,767,714) (3,038,553) 366,553 236,252 236,252 (3,503,810) 3,460,690 467,033 423,913 60,867 60,867 203,972 203,972 (3,503,810) 3,460,690 968,124 925,004 Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year 2,049,261 13,768,887 $ 15,818,148 815,708 27,565,619 $ 28,381,327 427,420 1,638,098 2,065,518 3,059,016 7,471,788 $ 10,530,804 6,351,405 50,444,392 $ 56,795,797 Classified as: Pooled cash and investments Cash with fiscal agents Totals $ 15,818,148 $ 15,818,148 $ 28,106,327 275,000 $ 28,381,327 $ $ 2,065,518 2,065,518 $ 10,530,804 $ 10,530,804 $ 56,520,797 275,000 $ 56,795,797 $ $ $ 603,477 $ (1,300,503) $ (1,676,444) $ Reconciliation of operating income (loss) to net cash provided (used) by operating activities Operating income (loss) Adjustments to reconcile operating income (loss) to net cash provided by (used in) operating activities: Depreciation and amortization (Increase) decrease in assets/deferred outflows: Accounts receivable Supplies inventory Net other postemployment benefits asset Deferred outflows - pension and other postemployment benefits Increase (decrease) in liabilities/deferred inflows: Accounts payable Accrued payroll Other liabilities Claims payable Compensated absences Net pension and other post employment benefit liability Deferred inflows - pension and other postemployment benefits Total adjustments Net cash provided (used) by operating activities Non-cash investing, capital and financing activities: Capital assets acquired through contributions from developers and City governmental funds Execution of Agreements for right to use Subscription Assets Change in fair market value of investments Total non-cash investing, capital and financing activities (54,758) 3,394,611 (924,660) - - 1,271,582 4,666,193 12,050 59,608 (6,468) 49,066 22,084 - (5,283) 173,702 7,800 (25,430) 262,226 41,934 59,608 (37,181) 484,994 355,898 15,944 31 21,206 257,513 (259,961) 3,899,498 (888,750) 5,828 2,192,076 4,710 1,335,948 (4,407) 14,754 (75,448) 332,645 (672,887) (236,924) 914,734 107,181 75,741 1,075,905 (1,261,004) 2,428,735 377,475 143,707 31 2,192,076 26,209 1,666,063 (2,193,852) 7,427,257 $ 5,750,813 $ 3,844,740 $ 411,288 $ 366,553 $ 1,128,232 $ 616,962 616,962 $ 23,934 23,934 $ - $ 307,293 307,293 $ 117 $ $ $ $ $ 616,962 307,293 23,934 948,189 FIDUCIARY FUNDS Play Peoria NFP Fund This fund accounts for monies held on behalf of separate not-for-profit agencies for which the City operates as an administrator. Westside Fire Training IGA Fund This fund accounts for monies held on behalf of a consortium of area fire departments that pool monies for training activities for which the City acts as the administrator. 118 CITY OF PEORIA, ARIZONA COMBINING STATEMENT OF NET POSITION FIDUCIARY FUNDS JUNE 30, 2023 Custodial Funds Westside PLAY Fire Peoria Training NFP Fund IGA Fund ASSETS Pooled cash and investments Due from other governments Interest receivable Total assets NET POSITION Restricted for: Individuals and organizations Other governments Total net position $ $ 152,729 413 153,142 153,142 153,142 119 $ $ Total Custodial Funds 45,010 7,620 138 52,768 $ 197,739 7,620 551 205,910 52,768 52,768 153,142 52,768 $ 205,910 CITY OF PEORIA, ARIZONA COMBINING STATEMENT OF CHANGES IN FIDUCIARY NET POSITION FIDUCIARY FUNDS FOR THE YEAR ENDED JUNE 30, 2023 Custodial Funds Westside PLAY Fire Peoria Training NFP Fund IGA Fund ADDITIONS Contributions: Individuals Intergovernmental Investment earnings: Interest Total additions $ 32,942 - DEDUCTIONS Recipient payments Total deductions Change in net position Net position - beginning of the year Net position - end of the year $ 120 $ 10,890 Total Custodial Funds $ 32,942 10,890 2,220 35,162 742 11,632 2,962 46,794 14,727 14,727 9,524 9,524 24,251 24,251 20,435 2,108 22,543 132,707 153,142 50,660 $ 52,768 183,367 $ 205,910 Statistical Section Statistical Section The Statistical Section presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplemental information says about the government’s overall financial health. Statistical information is different from financial statements in that the statistics usually cover more than one fiscal year and may present non-accounting information. The following tables present financial trends, information about the fiscal capacity of the government, and social and economic information, as necessary for complete disclosure and understanding of the City’s financial activity. The information presented in these tables is not required for fair presentation in conformity with accounting principles generally accepted in the United States of America and is therefore not covered by the auditor’s opinion. Contents Financial Trends These schedules contain trend information to help the reader understand how the City’s financial performance and well-being have changed over time. Revenue Capacity These schedules contain information to help the reader assess the City’s most significant local revenue sources - sales and use taxes, property taxes and utility user fees. Debt Capacity These schedules present information to help the reader assess the affordability of the City’s current levels of outstanding debt and the City’s ability to issue additional debt in the future. Economic and Demographic Information These schedules offer economic and demographic indicators to help the reader understand the environment within which the City’s financial activities take place. Operating Information These schedules contain service and infrastructure data to help the reader understand how the information in the City’s financial report relates to the services the City provides and the activities it performs. 121 Statistical Section Table Page Financial Trends I Net Position By Component II Changes in Net Position III Fund Balances, Governmental Funds IV Changes in Fund Balances, Governmental Funds 123 124 126 127 Revenue Capacity V City Transaction Privilege Taxes By Category VI Direct and Overlapping Sales Tax Rates VII Sales Tax Payers - By Category VIII Assessed Values By Property Classification IX Comparative Assessed Values X Direct and Overlapping Property Tax Rates XI Direct and Overlapping Property Tax Levies XII Limited Property Value Top Ten Tax Payers XIII Property Tax Levies and Collections XIV Utility Statistical Data 128 129 130 131 132 133 134 135 136 137 Debt Capacity XV Outstanding Debt By Type XVI Ratio of Net General Bonded Debt to Full Cash Value and Net Bonded Debt Per Capita XVII Direct and Overlapping General Obligation Bonded Debt – Current Fiscal Year XVIII Direct and Overlapping Governmental Activities Debt – Current Fiscal Year XIX Direct and Overlapping Governmental Activities Debt – Last Ten Fiscal Years XX Legal Debt Margin XXI Pledged Revenue Coverage – Excise Tax and State Shared Revenue Debt Obligations - Governmental Portion XXII Pledged Revenue Coverage – Water and Wastewater Revenue Bonds XXIII Pledged Revenue Coverage – Special Assessment Bonds XXIV Special Assessment Collections 140 141 142 143 144 145 146 147 148 149 Economic and Demographic Information XXV Demographic and Economic Statistics XXVI Major Employers Within the City 150 151 Operating Information XXVII Authorized Full-time Equivalent City Government Employees By Function XXVIII Operating Indicators By Function/Program XXIX Capital Asset Statistics By Function/Program 152 153 154 122 CITY OF PEORIA, ARIZONA NET POSITION BY COMPONENT LAST TEN FISCAL YEARS (accrual basis of accounting) Table I Fiscal Year 2015 (1) 2014 Governmental Activities Net investment in capital assets Restricted Unrestricted Total governmental activities net position Business-type Activities Net investment in capital assets Restricted Unrestricted Total business-type activities net position Primary Government Net investment in capital assets Restricted Unrestricted Total primary government net position $ $ $ $ $ $ 855,286,264 151,624,692 84,211,745 1,091,122,701 $ 533,623,141 23,153,024 68,382,971 625,159,136 $ 1,388,909,405 174,777,716 152,594,716 1,716,281,837 $ $ $ $ 2016 885,716,419 139,143,949 (29,002,988) 995,857,380 $ 568,223,130 23,830,354 54,351,770 646,405,254 $ 1,453,939,549 162,974,303 25,348,782 1,642,262,634 $ $ $ $ 2018 (2) 2017 899,648,174 162,959,546 (32,938,378) 1,029,669,342 $ 589,629,061 31,926,587 49,023,256 670,578,904 $ 1,489,277,235 194,886,133 16,084,878 1,700,248,246 $ $ $ $ 747,243,866 149,717,064 (41,146,402) 855,814,528 $ 597,736,728 27,590,003 59,376,481 684,703,212 $ 1,344,980,594 177,307,067 18,230,079 1,540,517,740 $ $ $ $ 2019 635,872,778 121,796,554 (7,041,008) 750,628,324 $ 600,474,983 29,456,418 67,576,862 697,508,263 $ 1,236,347,761 151,252,972 60,535,854 1,448,136,587 $ $ $ $ (1) Decrease in unrestricted net position is due to the implementation of GASB Statement No. 68. (2) Beginning net position was restated due to implementation of GASB Statement No. 75 and adjustments to capital assets and restricted cash with fiscal agents. Source: Statement of Net Position City financial records and reports 123 2020 671,171,180 121,505,682 (2,470,597) 790,206,265 $ 619,320,612 25,123,557 70,087,860 714,532,029 $ 1,290,491,792 146,629,239 67,617,263 1,504,738,294 $ $ $ $ 2021 687,881,892 112,074,204 25,270,359 825,226,455 $ 622,466,137 13,719,271 87,023,600 723,209,008 $ 1,310,348,029 125,793,475 112,293,959 1,548,435,463 $ $ $ $ 2022 727,837,350 122,549,508 33,644,712 884,031,570 $ 640,684,899 32,937,325 83,010,832 756,633,056 $ 1,368,522,249 155,486,833 116,655,544 1,640,664,626 $ $ 2023 732,178,933 132,975,636 81,171,085 946,325,654 $ 640,404,948 48,913,594 74,087,539 763,406,081 $ $ 1,372,583,881 181,889,230 155,258,624 $ 1,709,731,735 $ $ 735,144,237 147,049,925 114,694,957 996,889,119 662,256,419 33,324,822 88,896,938 784,478,179 $ 1,397,400,656 180,374,747 203,591,895 $ 1,781,367,298 Table II CITY OF PEORIA, ARIZONA CHANGES IN NET POSITION LAST TEN FISCAL YEARS (accrual basis of accounting) Fiscal Year 2014 Expenses Governmental Activities General Government Culture & Recreation Public Safety* Development Services Highways & Streets Public Works Human Services Interest on long-term debt Unallocated Depreciation Total governmental activities expenses Business-type Activities Water Utility Wastewater Utility Solid Waste Utility Stadium Storm Drain Utility Total business-type activities expenses Total primary government expenses Program Revenues Governmental Activities Charges for services Operating grants and contributions Capital grants and contributions Total governmental activities program revenues Business-type Activities Charges for services Capital grants and contributions Total business-type activities program revenues Total primary government program revenues Net (Expense)/Revenue Governmental Activities Business-type Activities Total primary government net expense $ $ $ $ $ $ 20,038,112 25,559,518 60,213,181 9,193,743 31,411,752 7,015,316 1,629,118 12,009,243 574,550 167,644,533 30,836,235 21,083,666 10,806,101 5,176,689 823,780 68,726,471 236,371,004 19,221,921 12,693,535 11,703,447 43,618,903 69,499,963 9,325,636 78,825,599 122,444,502 (124,025,630) 10,099,128 (113,926,502) 2015 $ $ $ $ $ $ 21,210,452 25,982,440 64,261,923 9,544,919 33,658,672 7,259,675 1,177,275 11,373,755 174,469,111 34,566,373 21,737,995 10,939,896 6,372,954 813,636 74,430,854 248,899,965 25,696,523 13,485,788 22,908,863 62,091,174 68,417,721 29,760,720 98,178,441 160,269,615 (112,377,937) 23,747,587 (88,630,350) 2016 $ $ $ $ $ $ 22,250,673 26,447,013 70,342,389 7,123,106 34,620,944 7,507,311 1,788,130 11,549,457 181,629,023 33,221,797 22,001,744 11,137,739 6,742,573 1,052,977 74,156,830 255,785,853 29,321,181 14,329,168 27,259,727 70,910,076 76,106,994 17,518,669 93,625,663 164,535,739 (110,718,947) 19,468,833 (91,250,114) 2017 $ $ $ $ $ $ 21,623,532 28,371,539 97,665,783 6,630,945 44,979,242 6,705,095 1,283,420 8,451,596 215,711,152 39,316,668 24,075,245 11,867,773 7,579,975 3,497,956 86,337,617 302,048,769 32,311,277 14,666,090 25,638,030 72,615,397 80,152,247 20,698,020 100,850,267 173,465,664 (143,095,755) 14,512,650 (128,583,105) * Beginning in fiscal year 2015, the Police and Fire line items have been combined and are being presented in the Public Safety line item. 124 2018 $ $ $ $ $ $ 20,343,398 28,003,374 81,720,528 5,731,857 54,647,432 5,694,902 2,527,213 8,011,112 206,679,816 40,780,450 25,715,392 13,008,905 7,736,745 3,301,070 90,542,562 297,222,378 34,954,574 16,640,349 20,441,205 72,036,128 85,557,374 12,517,749 98,075,123 170,111,251 (134,643,688) 7,532,561 (127,111,127) 2019 $ $ $ $ $ $ 21,473,593 29,499,798 89,026,946 4,757,015 55,594,789 5,112,076 4,072,235 7,768,341 217,304,793 41,968,847 24,512,758 13,749,718 7,850,061 3,469,645 91,551,029 308,855,822 37,925,774 15,394,092 31,886,362 85,206,228 84,331,736 14,999,480 99,331,216 184,537,444 (132,098,565) 7,780,187 (124,318,378) 2020 $ $ $ $ $ $ 25,559,396 31,614,048 90,943,804 4,825,318 60,214,083 6,731,383 4,691,770 7,903,847 232,483,649 44,813,959 30,007,409 14,059,601 6,868,271 3,747,753 99,496,993 331,980,642 34,130,112 30,380,591 17,490,699 82,001,402 87,888,011 15,053,394 102,941,405 184,942,807 (150,482,247) 3,444,412 (147,037,835) 2021 $ $ $ $ $ $ 26,262,983 31,387,780 101,363,787 6,369,766 53,298,576 7,188,048 2,154,216 5,196,192 233,221,348 47,882,705 29,013,309 15,039,332 6,865,555 3,918,628 102,719,529 335,940,877 33,877,259 26,737,353 33,507,214 94,121,826 97,952,658 29,697,095 127,649,753 221,771,579 (139,099,522) 24,930,224 (114,169,298) 2022 $ $ $ $ $ $ 29,320,764 38,959,427 95,609,943 7,241,732 59,756,231 7,498,034 3,480,639 6,341,184 248,207,954 57,101,424 32,608,310 16,406,294 7,279,287 4,947,393 118,342,708 366,550,662 36,304,943 26,225,414 36,466,449 98,996,806 100,817,330 19,914,624 120,731,954 219,728,760 (149,211,148) 2,389,246 (146,821,902) 2023 $ $ $ $ $ $ 37,273,981 45,008,300 108,735,210 6,827,829 51,902,098 8,629,505 4,857,735 7,307,398 270,542,056 61,406,938 30,287,509 18,141,399 9,623,372 4,602,541 124,061,759 394,603,815 35,733,582 29,850,458 15,421,371 81,005,411 108,537,468 17,954,815 126,492,283 207,497,694 (189,536,645) 2,430,524 (187,106,121) Table II CITY OF PEORIA, ARIZONA CHANGES IN NET POSITION LAST TEN FISCAL YEARS (accrual basis of accounting) Fiscal Year 2014 General Revenues and Other Changes in Net Position Governmental Activities Taxes Property taxes, levied for general purposes Property taxes, levied for debt service Sales and use taxes Franchise taxes Intergovernmental State shared sales taxes - unrestricted Urban revenue sharing - unrestricted Auto in-lieu taxes - unrestricted Investment Earnings(Losses) Gain on sale of capital assets Miscellaneous Special Item: Defeasance of G.O. debt Transfers in (out) Total governmental activities Business-type Activities Investment Earnings(Losses) Gain on sale of capital assets Transfers in (out) Total business-type activities Total primary government Change in Net Position Governmental Activities Business-type Activities Total primary government Source: $ $ $ $ 2,744,900 15,479,771 70,213,953 4,194,371 2015 $ 2,889,150 16,891,026 74,556,024 4,312,836 2016 $ 2,994,905 17,537,813 79,410,364 4,461,864 2017 $ 3,207,433 18,532,683 84,236,770 4,501,681 13,431,637 17,172,500 5,495,225 878,164 111,342 3,920,109 14,139,128 18,650,521 5,886,971 843,648 3,216,595 14,760,029 18,549,406 6,385,294 1,693,475 2,732,726 15,631,512 20,949,613 6,728,814 1,667,892 4,120,882 (28,205,646) 105,436,326 (11,931,172) 129,454,727 (3,994,967) 144,530,909 359,158 28,205,646 28,564,804 134,001,130 348,717 11,931,172 12,279,889 141,734,616 709,850 3,994,967 4,704,817 149,235,726 (18,589,304) 38,663,932 20,074,628 $ $ $ 17,076,790 36,027,476 53,104,266 $ $ $ 33,811,962 24,173,650 57,985,612 $ $ $ 2018 $ 3,522,321 20,152,280 89,781,248 5,035,331 2019 $ 5,099,325 20,276,526 93,182,810 4,925,609 2020 $ 5,928,720 21,829,330 99,747,911 4,776,257 (6,346,374) 153,230,906 15,894,140 20,334,388 6,799,997 2,172,236 5,383,459 (450,797) (4,803,295) 163,821,308 17,018,021 20,366,697 7,262,809 7,200,254 2,342,583 (5,997,632) 171,677,002 17,079,368 22,275,583 7,313,007 7,800,410 1,138,662 (2,387,307) 185,501,941 519,774 109,744 6,346,374 6,975,892 160,206,798 700,909 13,305 4,803,295 5,517,509 169,338,817 3,107,572 138,375 5,997,632 9,243,579 180,920,581 10,135,151 21,488,542 31,623,693 Statement of Activities City financial records and reports 125 $ $ $ 29,177,620 13,050,070 42,227,690 $ $ $ 39,578,437 17,023,766 56,602,203 $ $ $ 2021 $ 6,086,505 23,814,936 113,852,555 4,965,951 2022 $ 20,186,716 25,147,285 8,349,703 544,254 3,221,522 6,351,779 25,044,456 125,521,932 4,961,622 2023 $ 6,712,827 27,258,369 131,030,117 5,240,846 (8,264,790) 197,904,637 26,815,644 24,816,247 8,237,369 (6,556,874) 3,658,727 (3,373,622) 215,477,280 28,812,810 36,976,059 9,669,103 6,404,784 3,641,910 (15,646,720) 240,100,105 2,854,480 (9,220) 2,387,307 5,232,567 190,734,508 211,199 17,835 8,264,790 8,493,824 $206,398,461 (2,985,986) 24,095 3,373,622 411,731 215,889,011 2,918,672 15,646,720 18,565,392 258,665,497 35,019,694 8,676,979 43,696,673 $58,805,115 33,424,048 $92,229,163 $ $ $ 66,266,132 2,800,977 69,067,109 $ $ $ 51,563,465 21,012,310 72,575,775 CITY OF PEORIA, ARIZONA FUND BALANCES, GOVERNMENTAL FUNDS LAST TEN FISCAL YEARS (modified accrual basis of accounting) Table III Fiscal Year 2014 General Fund Nonspendable Restricted Committed Assigned Unassigned Total General Fund All Other Governmental Funds Nonspendable Restricted Committed Assigned Unassigned Total All Other Governmental Funds $ $ $ 262,852 54,193 37,028,922 3,340,512 17,308,306 57,994,785 131,641 145,352,432 10,300,556 23,410,508 - $ 179,195,137 2015 $ $ $ 163,703 67,084 36,911,493 3,056,458 21,584,005 61,782,743 70,579 127,294,490 10,572,297 22,821,310 (6,638,667) $ 154,120,009 2016 $ $ $ 115,042 388,375 38,464,678 2,859,523 20,816,526 62,644,144 67,986 150,498,066 10,885,668 30,353,689 - $ 191,805,409 2017 $ $ $ 113,859 354,566 40,221,571 2,618,447 25,684,922 68,993,365 69,711 137,842,918 11,315,062 27,978,550 - $ 177,206,241 2018 $ $ $ 123,939 40,488 42,249,268 1,760,838 33,849,097 78,023,630 2019 $ $ 2020 $ 277,778 25,943 56,852,819 1,768,200 111,244,006 $ 170,168,746 $ 190,312 1,924 59,902,768 3,748,153 99,008,274 $ 162,851,431 $ $ $ $ 60,828 143,532,067 2,838,609 16,217,244 - $ $ 160,890,907 $ 162,648,748 $ 120,298,976 126 2023 2,323,312 30,639 55,086,725 1,528,073 80,266,172 $ 139,234,921 $ 69,986 108,519,124 2,429,777 9,280,089 - $ 2022 939,966 40,762 52,300,995 1,363,728 58,221,670 112,867,121 78,068 115,222,701 10,663,895 34,926,243 - Source: Statement of Revenue, Expenditures and Changes in Fund Balances - Governmental Funds Balance Sheet - Governmental Funds City financial records and reports 2021 144,357 107,990,268 2,424,547 4,902,888 (7,969,083) $ 107,492,977 379,976 304,865,760 63,770,700 29,973,003 99,008,274 $ 497,997,713 194,330 10,879 62,978,528 5,604,860 127,018,726 $ 195,807,323 136,596 169,504,680 2,082,021 11,099,097 (808,741) $ 182,013,653 Table IV CITY OF PEORIA, ARIZONA CHANGES IN FUND BALANCES, GOVERNMENTAL FUNDS LAST TEN FISCAL YEARS (modified accrual basis of accounting) 2013 Revenues Taxes Intergovernmental Charges for Services Licenses and Permits Fines and Forfeitures Rents Investment Earnings(Losses) Special Assessments Miscellaneous $ Total Revenues Fiscal Year 2015 2014 89,948,724 49,831,144 21,405,623 2,564,075 2,257,477 1,101,082 537,732 1,217,271 5,880,511 $ 93,731,980 50,132,922 17,684,357 2,800,894 2,128,289 731,901 757,747 1,137,018 5,060,343 $ 2016 98,629,880 55,289,472 19,355,378 3,132,178 1,856,640 889,053 725,208 381,761 3,536,024 $ 104,369,837 65,237,794 21,812,733 4,080,210 1,747,528 915,846 1,462,408 381,950 3,278,730 2017 $ 2018 110,535,434 60,096,580 24,367,635 4,778,632 1,571,788 908,678 1,320,578 2,171,319 4,411,440 $ 118,352,843 61,643,624 26,637,159 5,509,240 1,815,644 1,002,948 1,709,765 5,307,423 2019 $ 2020 123,645,058 61,054,399 28,089,117 5,720,889 2,390,644 980,732 6,364,506 3,049,527 $ 2021 131,784,413 85,338,544 27,299,388 4,929,081 1,382,853 721,181 6,881,841 1,258,583 $ 2022 148,454,717 83,673,505 26,414,975 5,287,497 1,535,140 843,911 85,750 3,537,355 $ 2023 162,396,713 96,914,612 28,254,679 5,100,898 1,731,336 1,080,477 (6,532,719) 3,732,659 $ 170,261,592 106,279,739 29,001,041 3,650,883 1,779,161 1,052,182 5,284,806 3,822,969 174,743,639 174,165,451 183,795,594 203,287,036 210,162,084 221,978,646 231,294,872 259,595,884 269,832,850 292,678,655 321,132,373 15,094,866 19,668,598 56,702,266 8,568,013 16,355,505 4,914,720 2,213,374 39,612,698 15,866,612 21,762,725 58,976,873 9,311,964 17,098,590 5,110,924 1,604,288 17,728,188 17,085,501 22,181,064 60,840,413 9,714,954 19,400,893 5,261,842 1,147,341 26,491,974 19,424,865 21,797,069 68,151,428 7,129,814 19,086,404 5,325,264 1,725,328 12,332,241 18,216,483 23,862,880 73,087,082 6,291,295 21,610,293 6,384,151 1,184,926 29,367,979 17,493,779 24,200,927 79,514,160 5,935,127 25,666,063 5,415,791 2,447,943 25,896,002 18,381,872 26,631,491 84,514,269 4,835,544 27,314,691 5,535,727 4,020,781 27,839,028 19,129,269 29,367,980 90,140,255 4,867,486 32,490,156 6,927,246 4,690,171 55,429,562 22,437,588 27,500,891 94,011,139 6,221,071 24,989,110 6,731,414 2,143,606 33,233,819 26,640,810 34,019,114 135,035,214 6,967,231 30,518,643 7,234,142 3,476,262 17,099,261 31,367,566 38,588,757 114,823,555 6,702,535 24,817,250 8,008,222 4,828,035 24,151,553 Expenditures General Government Culture & Recreation Public Safety (1) Development Services Highways & Streets Public Works Human Services Capital Outlay Debt Service Interest 12,534,039 12,543,974 11,933,264 10,606,558 11,336,938 9,705,255 8,776,334 8,623,160 8,170,203 7,635,199 8,528,288 Principal 20,120,163 21,937,761 17,305,000 18,010,000 19,867,000 19,483,000 22,022,461 22,726,060 21,569,912 24,368,166 26,394,001 Payment to bond escrow agent - - - 6,707,216 13,604,681 - - - - - - Total Expenditures 195,784,242 181,941,899 191,362,246 190,296,187 211,209,027 229,362,728 229,872,198 274,391,345 247,008,753 292,994,042 288,209,762 Excess of Revenues over (under) Expenditures (21,040,603) (7,776,448) (7,566,652) 12,990,849 (1,046,943) (7,384,082) 1,422,674 (14,795,461) 22,824,097 (315,387) 32,922,611 Other Financing Sources (Uses) Refunding bonds issued Issuance of debt Premium on bonds issued Payments to bond refunding escrow agent Transfers In Transfers Out 35,510,000 1,039,481 16,968,105 (27,205,066) 112,000 20,159,941 (48,650,688) 35,000 16,357,492 (30,113,010) 103,410,000 30,325,000 14,096,688 (114,802,841) 12,890,960 (20,363,855) 3,000,000 108,061 17,925,171 (28,236,236) 28,975,000 5,199,304 (28,814,053) 17,684,545 (19,786,126) 30,420,000 3,146,339 36,612,624 (35,000,305) 2,590,000 292,139 14,049,347 (18,117,997) 20,855,000 1,870,000 2,448,280 (22,641,792) 9,787,365 (17,015,124) 21,495,000 55,880,000 8,086,575 (26,081,153) 11,422,490 (17,724,676) 31,708,075 1,547,460 9,484,295 (28,266,035) Total Other Financing Sources (Uses) Net Change in Fund Balance Debt Service as a percentage of noncapital expenditures (1) 26,312,520 $ 5,271,917 20.91% (28,378,747) $ (36,155,195) (13,720,518) $ (21,287,170) 21.00% 17.73% 25,555,952 $ 38,546,801 (7,203,004) $ (8,249,947) 19.85% 17.16% Beginning in Fiscal Year 2015, Police and Fire expenditures were combined into the Public Safety category. Source: Statement of Revenue, Expenditures and Changes in Fund Balances - Governmental Funds City financial records and reports 127 3,258,670 $ (4,125,412) 21.03% 35,178,658 $ 36,601,332 15.24% (1,186,511) $ (15,981,972) 14.32% (4,696,271) $ 18,127,826 13.91% 53,078,236 $ 52,762,849 11.60% 14,473,795 $ 47,396,406 13.23% Table V CITY OF PEORIA, ARIZONA CITY TRANSACTION PRIVILEGE TAXES BY CATEGORY LAST TEN FISCAL YEARS Fiscal Year 2014 2015 2016 2017 2018 Retail Sales Contracting Rentals Utilities* Telecom/Cable TV Restaurant/Bar Amusement Use Other $ 36,878,825 6,301,005 7,214,392 7,388,831 1,262,651 8,505,082 960,332 624,795 2,101,228 $ 38,908,327 6,257,112 7,522,177 7,498,115 1,217,583 9,284,232 1,036,941 718,931 2,112,606 $ 41,216,781 7,394,036 8,123,884 7,904,665 1,151,941 9,833,912 1,034,959 740,179 2,010,007 $ 43,666,206 8,587,978 8,383,946 8,022,722 942,239 10,335,218 1,021,968 1,243,655 2,032,838 $ 45,112,750 10,219,772 8,823,620 8,911,107 816,179 11,388,465 979,386 1,707,181 1,822,787 $ Total $ 71,237,141 $ 74,556,024 $ 79,410,364 $ 84,236,770 $ 89,781,247 $ 8.1% 33.6% -8.9% 0.6% 0.3% 4.1% -3.3% 31.6% 118.7% 5.5% -0.7% 4.3% 1.5% -3.6% 9.2% 8.0% 15.1% 0.5% 5.9% 18.2% 8.0% 5.4% -5.4% 5.9% -0.2% 3.0% -4.9% 5.9% 16.1% 3.2% 1.5% -18.2% 5.1% -1.3% 68.0% 1.1% 3.3% 19.0% 5.2% 11.1% -13.4% 10.2% -4.2% 37.3% -10.3% 8.0% 4.7% 6.5% 6.1% 6.6% % Growth by Year Retail Sales Contracting Rentals Utilities Telecom/Cable TV Restaurant/Bar Amusement Use Other Total 2019 * For confidentiality reasons, Utilities sales tax cannot be reported separately in FY2023 and is included with Other Note: Includes all governmental fund types Source: City financial records and reports 128 2020 48,201,653 9,108,314 8,983,145 8,115,617 697,849 11,661,217 1,246,039 2,248,575 2,920,401 $ 93,182,810 $ 2021 2022 2023 52,794,953 11,472,743 10,684,541 8,303,764 725,389 11,597,024 971,024 2,334,003 864,471 $ 63,612,494 10,673,164 10,279,587 9,042,824 494,061 13,499,778 1,004,435 3,551,444 1,694,768 $ 69,900,613 11,285,579 11,194,971 9,164,337 446,508 15,917,098 1,689,514 3,048,117 2,875,195 $ 125,521,932 $ 73,186,740 10,035,444 12,326,917 99,747,911 $ 113,852,555 $ 6.8% -10.9% 1.8% -8.9% -14.5% 2.4% 27.2% 31.7% 60.2% 9.5% 26.0% 18.9% 2.3% 3.9% -0.6% -22.1% 3.8% -70.4% 20.5% -7.0% -3.8% 8.9% -31.9% 16.4% 3.4% 52.2% 96.0% 9.9% 5.7% 8.9% 1.3% -9.6% 17.9% 68.2% -14.2% 69.7% 16.4% 8.3% 9.3% -14.9% 361.9% 3.79% 7.05% 14.14% 10.25% 4.39% 519,698 17,239,681 1,846,366 2,594,351 13,280,920 131,030,117 4.7% -11.1% 10.1% Table VI CITY OF PEORIA, ARIZONA DIRECT AND OVERLAPPING SALES TAX RATES LAST TEN FISCAL YEARS Year Taxes Are Payable 2015 2016 2014 2017 2018 2019 2020 2021 2022 2023 City Direct Rates (1): Retail Sales (excluding groceries) Groceries Contracting Rentals Hotel/Transient Lodging Utilities Telecommunications Restaurant/Bar Amusement All Others 1.80% 1.80% 1.80% 1.80% 5.60% 3.30% 1.80% 2.80% 2.80% 1.80% 1.80% 1.60% 1.80% 1.80% 5.60% 3.30% 1.80% 2.80% 2.80% 1.80% 1.80% 1.60% 1.80% 1.80% 5.60% 3.30% 1.80% 2.80% 2.80% 1.80% 1.80% 1.60% 1.80% 1.80% 5.60% 3.30% 1.80% 2.80% 2.80% 1.80% 1.80% 1.60% 1.80% 1.80% 5.60% 3.30% 1.80% 2.80% 2.80% 1.80% 1.80% 1.60% 1.80% 1.80% 5.60% 3.30% 1.80% 2.80% 2.80% 1.80% 1.80% 1.60% 1.80% 1.80% 5.60% 3.30% 1.80% 2.80% 2.80% 1.80% 1.80% 1.60% 1.80% 1.80% 5.60% 3.30% 1.80% 2.80% 2.80% 1.80% 1.80% 1.60% 1.80% 1.80% 5.60% 3.30% 1.80% 2.80% 2.80% 1.80% 1.80% 1.60% 1.80% 1.80% 5.60% 3.30% 1.80% 2.80% 2.80% 1.80% County Rates: Retail Sales (excluding groceries) Groceries Hotel/Transient Lodging Mining - Nonmetal All Others 0.70% 0.70% 1.77% 0.44% 0.70% 0.70% 0.70% 1.77% 0.44% 0.70% 0.70% 0.70% 1.77% 0.44% 0.70% 0.70% 0.70% 1.77% 0.44% 0.70% 0.70% 0.70% 1.77% 0.44% 0.70% 0.70% 0.70% 1.77% 0.44% 0.70% 0.70% 0.70% 1.77% 0.44% 0.70% 0.70% 0.70% 1.77% 0.44% 0.70% 0.70% 0.70% 1.77% 0.44% 0.70% 0.70% 0.70% 1.77% 0.44% 0.70% State Rates (2): Retail Sales (excluding groceries) Hotel/Transient Lodging Mining - Nonmetal Mining - Severance All Others 5.60% 5.50% 3.13% 2.50% 5.60% 5.60% 5.50% 3.13% 2.50% 5.60% 5.60% 5.50% 3.13% 2.50% 5.60% 5.60% 5.50% 3.13% 2.50% 5.60% 5.60% 5.50% 3.13% 2.50% 5.60% 5.60% 5.50% 3.13% 2.50% 5.60% 5.60% 5.50% 3.13% 2.50% 5.60% 5.60% 5.50% 3.13% 2.50% 5.60% 5.60% 5.50% 3.13% 2.50% 5.60% 5.60% 5.50% 3.13% 2.50% 5.60% Notes: (1) Pursuant to City Charter, increases in the City transaction privilege (sales) tax rates are subject to voter approval. Prior to January 2017, the City collected its own sales tax. In January 2017, the state began collecting and remitting the sales tax to the City. The City has earmarked 0.8% of its sales tax for payment of Excise Tax and State Shared Revenue Obligations. (2) The State transaction privilege (sales) tax is levied against the same categories of business activity as the City's sale tax with the exception of groceries and prescription drugs, which the State exempts from tax. The State collects and distributes a portion of its sales tax revenues to all cities and towns based on the city or town's population relative to the aggregate population of all cities and towns as shown by the latest census. Source: ADOR Transaction Privilege And Other Tax Rate Tables 129 CITY OF PEORIA, ARIZONA SALES TAX PAYERS - BY CATEGORY CURRENT YEAR AND NINE YEARS AGO Table VII 2023 Category # of Payers Percentage of Total Payers 2014 Sales Tax Paid Percentage of Total City Sales Tax Revenue # of Payers Percentage of Total Payers 20.83% 24.74% 2.25% 41.45% 0.09% 1.15% 8.56% 0.39% 0.53% 100.00% Retail Sales Contracting Restaurant/Bar Rental Utilities* Telecom/Cable TV Use Amusement Others 6,626 321 311 3,015 55.5% 2.7% 2.6% 25.3% 73,186,740 10,035,444 17,239,681 12,326,917 55.60% 7.60% 13.10% 9.50% 198 1,360 45 57 1.7% 11.4% 0.4% 0.5% 519,698 2,594,351 1,846,366 13,800,618 0.50% 2.00% 1.40% 10.50% 3,292 3,910 355 6,550 15 182 1,353 62 84 Total 11,933 100.10% 131,549,815 100.20% 15,803 $ * For confidentiality reasons, Utilities sales tax cannot be reported separately in FY2023 and is included with Others Source: City Sales Tax system City financial records 130 Sales Tax Paid $ Percentage of Total City Sales Tax Revenue 36,878,825 6,301,005 8,505,082 7,214,392 7,388,831 1,262,651 624,795 960,332 2,101,228 51.80% 8.80% 11.90% 10.10% 10.40% 1.80% 0.90% 1.30% 2.90% 71,237,141 99.90% CITY OF PEORIA, ARIZONA ASSESSED VALUES BY PROPERTY CLASSIFICATION LAST TEN FISCAL YEARS 2014 2015 546,593,560 161,107,937 $ 2016 $ $ $ $ 1,155,587,438 9.3% $ 1,178,016,995 1.9% $ 1,244,679,295 5.7% $ 1,340,068,217 7.7% $ 1,439,812,989 7.4% $ 1,556,721,002 8.1% $ 1,659,175,244 15.2% $ 1,780,974,057 7.3% $ 1,890,818,254 6.2% Net Assessed Value Per Capita Population $ 6,702 157,780 $ 7,203 160,432 $ 7,174 164,212 $ 7,400 168,192 $ 7,632 172,259 $ 8,008 179,800 $ 8,641 190,985 $ 8,687 194,517 $ 9,156 194,517 $ 9,481 199,424 310,764,850 44,053,047 1,065,441 305,265 25,390 813,110,830 259,614,712 $ 875,459,952 290,792,306 328,762,027 36,731,719 1,015,986 577,715 - $ 352,052,608 36,824,728 1,040,771 502,515 48,122 954,002,402 309,884,348 356,175,720 37,571,067 1,002,644 488,535 50,528 1.25 1.25 1.25 1.25 1.25 1.15 1.15 1.15 Full Cash Value % Growth $ 10,057,364,678 -5.4% $ 11,162,489,178 11.0% $ 13,968,351,523 25.1% $ 15,264,587,035 9.3% $ 16,607,545,225 8.8% $ 18,374,791,035 10.6% $ 20,055,499,784 9.1% $ 22,175,481,320 20.7% Full Cash Value Per Capita $ $ $ $ $ $ $ $ Net Assessed Value as a Percentage of Full Cash Value 63,743 10.5% 69,578 85,063 10.4% 8.4% 90,757 8.2% 96,410 8.1% 102,196 7.8% Note: All property, both real and personal, is assigned a classification to determine its assessed valuation for tax purposes. Each classification is defined by property use and has an assessment ratio that is multiplied by the taxable value of the property to obtain the assessed valuation. The assessment ratios for the major classes of property are as follows: Property Tax Assessment Ratios (a) Fiscal Year 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Residential 10% 10% 10% 10% 10% 10% 10% 10% 10% 10% 10% Agriculture and Vacant Land 16% 16% 16% 16% 15% 15% 15% 15% 15% 15% 15% Railroad 15% 15% 16% 15% 14% 15% 14% 15% 15% 15% 15% (a) Several additional classes of property exist, but seldom amount to a significant portion of an entity's total valuation. 131 111,320 7.8% $ 2023 1,057,413,204 -7.0% 297,883,403 40,513,630 1,040,707 396,725 - 740,037,974 243,816,250 2022 $ 291,761,032 44,305,284 1,137,482 24,540 5,100 674,378,782 230,466,048 2021 Net Assessed Value % Growth 298,078,633 42,347,136 1,205,775 59,907 48,182 626,696,840 214,086,717 2020 $ Total Direct Secondary Tax Rate $ 2019 Residential (Owner occupied) Residential (Renter occupied) Commercial, Industrial, Mining & Utilities Agriculture & Vacant Railroad Historic & Environmental Public Property Improvements 304,844,019 43,659,181 1,118,206 83,177 7,124 614,234,433 199,613,372 Fiscal Year 2018 2017 Table VIII 116,111 7.5% 1,034,473,284 328,554,140 $ 379,013,645 37,321,864 1,061,989 496,080 53,055 1,103,379,764 363,797,432 385,810,266 36,498,803 1,276,282 55,707 1.15 1.15 $ 24,444,971,352 10.2% $ 26,391,921,793 8.0% $ 125,670 7.3% $ 132,341 7.2% CITY OF PEORIA, ARIZONA COMPARATIVE ASSESSED VALUES LAST TEN FISCAL YEARS Table IX Fiscal Year 2014 City of Peoria $ 1,057,413,204 2015 $ 1,155,587,438 2016 (a) $ 1,178,016,995 2017 $ 1,244,679,295 2018 $ 1,340,068,217 2019 $ 1,439,812,989 2020 $ 1,556,721,002 2021 $ 1,659,175,244 2022 $ 1,780,974,057 2023 $ 1,890,818,254 Peoria Unified School District No. 11 1,350,310,615 1,471,213,352 1,475,721,803 1,549,607,885 1,649,351,547 1,780,118,947 1,934,677,253 2,043,501,690 2,188,687,421 2,316,600,539 Maricopa County 32,229,006,810 35,079,646,593 34,623,670,323 36,135,494,474 38,251,891,249 40,423,232,421 43,194,326,395 45,704,969,813 48,724,126,672 51,575,018,189 State of Arizona 52,598,341,678 55,349,948,120 54,840,074,052 56,573,588,295 59,404,007,785 62,328,357,186 66,158,541,837 69,914,521,042 74,200,233,397 78,405,598,978 (a) Prior to FY2015-16, Primary or Limited Property Values were used for primary ad valorem taxes which are levied for operations of the city and Secondary Assessed Values were used for secondary ad valorem taxes which are levied for debt service. Beginning in FY2015-16, with a voter approved constitutional amendment, both primary and secondary ad valorem taxes are now levied on the Limited Property Values. Because FY2015-16 is the first year for implementation of the constitutional amendment and use of Limited Property Values, there is no comparative data from prior years and accordingly the Net Assessed Values presented for years prior to FY2015-16 represent Secondary Assessed Values based on the then-applicable but now replaced valuation rules. Source: Arizona Department of Revenue - Property Tax Division Abstract of the Assessment Roll City financial records 132 Table X CITY OF PEORIA, ARIZONA DIRECT AND OVERLAPPING PROPERTY TAX RATES LAST TEN FISCAL YEARS (rate per $100 assessed value) 2014 Total Direct City Primary Secondary Total $ Peoria Unified School District No. 11 (1) Primary Secondary Total Maricopa County (2) Primary Secondary Total 0.19 1.25 1.44 2015 $ 0.19 1.25 1.44 Fiscal Year 2016 $ 0.19 1.25 1.44 2017 $ 0.19 1.25 1.44 2018 $ 0.19 1.25 1.44 2019 $ 0.29 1.15 1.44 2020 $ 0.29 1.15 1.44 2021 $ 0.29 1.15 1.44 2022 $ 0.29 1.15 1.44 2023 $ 0.29 1.15 1.44 4.18 3.35 7.53 4.43 2.84 7.27 4.93 2.84 7.77 4.78 3.26 8.04 4.51 3.03 7.54 4.00 3.02 7.02 3.86 2.94 6.80 3.75 2.92 6.66 3.72 2.44 6.16 3.54 2.23 5.77 3.08 0.79 3.87 3.11 0.86 3.98 3.13 0.97 4.10 3.14 1.01 4.15 3.09 1.07 4.16 3.05 1.03 4.08 3.01 1.05 4.07 2.97 1.02 3.99 2.89 0.96 3.85 2.34 0.86 3.20 7.45 5.39 12.84 7.73 4.95 12.69 8.25 5.06 13.31 8.11 5.52 13.63 7.79 5.35 13.14 7.34 5.20 12.54 7.16 5.15 12.31 7.01 5.08 12.09 6.90 4.55 11.45 6.17 4.24 10.41 Total Primary Secondary Total $ $ $ $ $ $ $ $ (1) Peoria Unified School District serves the majority of the City of Peoria. Other areas of the City are served by the Deer Valley Unified School District whose most recent rates are as follows: Primary Secondary Deer Valley Unified School District $ 3.53 $ 2.31 (2) The Maricopa County rates includes the rates for the County, State Education Equalization Assistance and other county districts and special districts as follows: Maricopa County State Education Equalization Assistance Maricopa County Community College District Maricopa County Flood Control District Maricopa County Fire District Assistance Maricopa County Library District Maricopa County Special Health Care District West Maricopa Education Center Central Arizona Water Conservation District Fiscal Year 2023 Tax Rate Primary $ 1.25 1.09 $ 2.34 Secondary $ 0.10 0.16 0.01 0.05 0.25 0.15 0.14 $ 0.86 Note: All rates rounded to two decimal places from the four shown by the County Source: Maricopa County Assessor - Tax Rates Publication 133 $ $ Table XI CITY OF PEORIA, ARIZONA DIRECT AND OVERLAPPING PROPERTY TAX LEVIES LAST TEN FISCAL YEARS 2014 Total Direct City Primary Secondary Total $ 1,998,305 13,217,665 15,215,970 2015 $ 2,115,212 14,444,843 16,560,055 2016 $ 2,238,232 14,725,212 16,963,444 Tax Levy Fiscal Year 2018 2017 $ 2,364,891 15,558,491 17,923,382 $ 2,546,130 16,750,853 19,296,983 2019 $ 4,175,458 16,557,849 20,733,307 2020 $ 4,514,491 17,902,292 22,416,783 2021 $ 4,811,608 19,080,515 23,892,123 2022 $ 5,164,825 20,481,202 25,646,027 2023 $ 5,483,373 21,744,410 27,227,783 Peoria Unified School District No. 11 (1) Primary Secondary 56,069,720 45,266,377 62,749,751 41,807,627 72,782,246 41,966,017 74,140,908 50,494,525 74,370,911 50,046,959 71,186,957 53,764,234 74,661,130 56,922,243 76,563,878 59,604,705 81,502,342 53,396,580 81,921,945 51,687,487 Maricopa County (2) Primary Secondary 986,315,014 251,345,124 1,043,203,072 274,744,408 1,083,409,268 234,978,404 1,134,787,546 337,146,316 1,179,611,336 356,706,002 1,231,523,511 373,658,155 1,300,978,643 402,738,173 1,357,249,060 411,099,616 1,405,395,276 409,383,469 1,203,658,775 390,658,525 Total Primary Secondary Total $ 1,044,383,039 309,829,166 1,354,212,205 $ 1,108,068,035 330,996,878 1,439,064,913 $ 1,158,429,746 291,669,633 1,450,099,379 $ 1,211,293,345 403,199,332 1,614,492,677 (1) The Peoria Unified School District serves the majority of the City of Peoria. Other areas of the City are served by Deer Valley Unified School District, whose most recent tax levies are as follows: Deer Valley Unified School District $ Primary 114,054,971 $ Secondary 74,688,483 (2) The tax levies for Maricopa County include those for the County, State Education Equalization, and other county and special districts whose most recent tax levies are as follows: Maricopa County State Education Equalization Assistance Maricopa County Community College District Maricopa County Flood Control District Maricopa County Fire District Assistance Maricopa County Library District Maricopa County Special Health Care District West Maricopa Education Center Central Arizona Water Conservation District Fiscal Year 20220Tax Levy Source: $ $ Primary 643,295,202 560,363,573 1,203,658,775 Secondary $ $ 53,051,463 75,704,791 4,252,620 26,045,384 129,214,055 29,684,155 72,706,057 390,658,525 Maricopa County Assessor - Tax Rates and Levies publication 134 $ 1,256,528,377 423,503,814 1,680,032,191 $ 1,306,885,926 443,980,238 1,750,866,164 $ 1,380,154,264 477,562,708 1,857,716,972 $ 1,438,624,546 489,784,836 1,928,409,382 $ 1,492,062,443 483,261,251 1,975,323,694 $ 1,291,064,093 464,090,422 1,755,154,515 CITY OF PEORIA, ARIZONA LIMITED PROPERTY VALUE TOP TEN TAX PAYERS CURRENT YEAR AND NINE YEARS AGO Table XII 2023(a)(b) Taxpayer Arizona Public Service Vestar LPTC LLC Park West Retail I LLC Park West WFB LLC DDRA Arrowhead Crossing LLC Imagine Peoria Properties LLC N 75th AZ Partners LLC Freedom Plaza Limited Partnership Lease Peoria Center Apartments South LLC BCC Development Inc. Sprint Nextel Wireless LP Vestar Arizona XLVIII LLC Miller Family Real Estate LLC Southwest Gas Corporation Excel Lake Pleasant LLC Target Corporation Total Type of Business Gas & Electric Utility Property Development Shopping Center Asset Management Shopping Center Property Development Multi-family Housing Retirement Housing Multi-family Housing Property Development Telecommunications Property Development Shopping Center Gas Utility Shopping Center Shopping Center Limited Property Assessed Value $ 22,885,032 9,075,794 7,693,022 7,023,910 5,216,283 4,966,663 4,891,421 4,678,132 4,470,245 4,453,696 $ Rank 1 2 3 4 5 6 7 8 9 10 2014 % of Limited Property Assessed Value 1.28% 0.51% 0.43% 0.39% 0.29% 0.28% 0.27% 0.26% 0.25% 0.25% 75,354,198 4.23% $ (a) Prior to FY2015-16, Primary or Limited Property Values were used for primary ad valorem taxes which are levied for operations of the city and Secondary Assessed Values were used for secondary ad valorem taxes which are levied for debt service. Beginning in FY2015-16, with a voter approved constitutional amendment, both primary and secondary ad valorem taxes are now levied on the Limited Property Values Because FY2015-16 is the first year for implementation of the constitutional amendment and use of Limited Property Values, there is no comparative data from prior years and accordingly the Net Assessed Values presented for years prior to FY2015-16 represent Secondary Assessed Values based on the then-applicable but now replaced valuation rules. (b) In 2023 Maricopa County changed their reporting software, so company consolidations may be different from prior years. Note - As a quasi-governmental entity, Salt River Project pays in-Lieu taxes, rather than property taxes. For fiscal year 2023, the assessed value of Salt River Project property within the City of Peoria is $20,630,940 Source - Maricopa County Treasurer's or Assessor's Office 135 Rank 1 8 4 % of Taxable Secondary Assessed Value 2.26% 0.36% 0.47% $4,493,481 5 0.42% 7,828,821 4,986,864 4,397,673 3,992,858 3,737,680 3,688,771 65,871,362 2 3 6 7 9 10 0.74% 0.47% 0.42% 0.38% 0.35% 0.35% 6.23% Taxable Secondary Assessed Value $ 23,928,175 3,832,994 4,984,045 CITY OF PEORIA, ARIZONA PROPERTY TAX LEVIES AND COLLECTIONS LAST TEN FISCAL YEARS Fiscal Year Ended June 30, 2023 2022 2021 2020 2019 2018 2017 2016 2015 2014 2013 Notes: 27,227,783 25,646,027 23,892,123 22,416,783 20,733,307 19,296,983 17,923,382 16,963,444 16,560,055 15,215,970 16,372,418 (1) (2) Source: Collected with the Fiscal Year of the Levy (2) Percentage Amount of Levy Taxes Levied for the Fiscal Year (1) $ 27,003,934 25,375,055 23,599,465 21,914,662 20,589,725 18,955,264 17,596,843 16,695,651 16,290,571 14,882,168 15,962,490 99.18% 98.94% 98.78% 97.76% 99.31% 98.23% 98.18% 98.42% 98.37% 97.81% 97.50% Table XIII Collections in Subsequent Years (2) 234,842 222,627 280,245 49,481 156,712 178,622 144,002 176,834 231,305 247,428 Levy figures obtained from Maricopa County Tax Levy Books-February Publication. Collection amount obtained from Maricopa County Treasurer's Secured Levy Report at 6/30/2023 Maricopa County Treasurer's Office Maricopa County Assessor's Office City financial records and reports 136 Total Collections To Date Percentage Amount of Levy 27,003,934 25,609,897 23,822,092 21,914,662 20,639,206 19,111,976 17,775,465 16,839,653 16,467,405 15,113,473 16,209,918 99.18% 99.86% 99.71% 97.76% 99.55% 99.04% 99.17% 99.27% 99.44% 99.33% 99.01% CITY OF PEORIA, ARIZONA UTILITY STATISTICAL DATA LAST TEN FISCAL YEARS Average Utility Bill Amounts Last Ten Fiscal Years 2016 (c) 2017 2014 2015 $37.31 -0.27% $35.54 -4.74% $37.53 5.60% $23.36 -3.31% $23.99 2.70% $13.38 0.00% $13.35 -0.22% Table XIV 2018 2019 2020 2021 2022 2023 $39.13 4.26% $41.44 5.90% $42.15 1.71% $43.02 2.06% $43.87 1.98% $45.08 2.76% $46.35 2.82% $24.64 2.71% $25.22 2.35% $25.26 0.16% $26.60 5.30% $26.91 1.17% $27.29 1.41% $28.58 4.73% $29.05 1.64% $13.44 0.67% $13.39 -0.37% $14.23 6.27% $14.42 1.34% $15.29 6.03% $16.21 6.02% $17.06 5.24% $17.96 5.28% 2018 2019 2020 2021 2022 2023 Water Average bill % Increase Wastewater Average bill % Increase Residential Solid Waste Average bill % Increase Water # of Accounts % Increase Wastewater # of Accounts % Increase Residential Solid Waste # of Accounts % Increase Utility Service Connections Last Ten Fiscal Years 2016 (c) 2017 2014 2015 50,399 1.99% 51,405 2.00% 55,558 8.08% 57,011 2.62% 58,061 1.84% 59,185 1.94% 60,705 2.57% 62,083 2.27% 63,357 2.05% 63,575 0.34% 53,548 1.66% 54,599 1.96% 56,235 3.00% 57,909 2.98% 59,499 2.75% 60,913 2.38% 62,617 2.80% 63,924 2.09% 65,169 1.95% 65,923 1.16% 51,609 1.74% 52,640 2.00% 54,262 3.08% 55,828 2.89% 57,452 2.91% 58,816 2.37% 60,123 2.22% 61,332 2.01% 62,575 2.03% 63,323 1.20% Charges for Wastewater Services Base Minimum Monthly Bill As of June 30, 2023 Charges for Water Services Base Minimum Monthly Bill As of June 30, 2023 Resid., Commerc. & Landscape Multi Family Customers Meter Size 5/8"-3/4" Base Charge 1" per Meter 1 1/2" $9.06 2" 3" Charge per 4" Dwelling Unit 6" $5.00 8" Resid., Landscape Charge $ 17.38 21.27 35.56 51.16 92.83 139.66 269.67 425.75 Multi Family Customers Base Charge per Meter $4.07 Charge per Dwelling Unit $3.70 Meter Size 5/8"-3/4" 1" 1 1/2" 2" 3" 4" 6" 8" Charge $ 10.23 10.23 24.58 36.90 69.80 106.75 209.37 332.56 (a) Base service charge is based on each bill rendered. (b) For residential & multi-plex users, volume is measured as the rate per 1,000 gallons of a four-month winter average (December - March). For commercial customers, the volume charge is based on actual monthly usage. (c) Water account total includes the acquisition of New River System. These accounts were excluded from the FY16 average water bill calculation, but included beginning in FY17. Source: City customer servCity customer service and billing records (continued) 137 Table XIV CITY OF PEORIA, ARIZONA UTILITY STATISTICAL DATA Volume Consumption (gallons) 0 - 4,000 4,001 - 10,000 10,001 - 20,000 20,000+ Volume Charges for Water Services Usage Per Month As of June 30, 2023 Residential Multiplex (per 1,000 gallons) (per 1,000 gallons) $ 1.26 $ 3.34 4.75 5.26 - Commercial (per 1,000 gallons) $ - 1,000+ - 3.34 - 0 - 10,000 10,001 - 50,000 50,000+ - - 1.26 3.34 4.75 Water Meter Permit Charges As of June 30, 2023 Meter Size Charge 317 3/4" $ 495-781 1 1/2" 629 - 1,033 2" 3" 1,751 - 2,662 4" 2,231 - 3,172 6" 3,781 - 5,086 Hydrant meter 1,280 Commercial accounts By meter size Charges for Residential Solid Waste As of June 30, 2023 Monthly fee Single container & recycling $ 17.96 Additional container 14.71 Charges for Storm Water As of June 30, 2023 Monthly All Customers $ 1.50 (a) Base service charge is based on each bill rendered. (b) For residential & multiplex users, volume is measured as the rate per 1,000 gallons of a three-month winter average (December - February). For commercial customers, the volume charge is based on actual monthly usage. Source: City customer service and billing records (continued) 138 X CITY OF PEORIA, ARIZONA UTILITY STATISTICAL DATA TEN LARGEST WATER USERS CURRENT YEAR AND NINE YEARS AGO Table XIV 2014 2023 Entity Trilogy at Vistancia Blue Star Golf Blackstone Country Club Sunrise Water Company City of Peoria - Parks North Sun Harbor Community Assoc Ashton Woods Homes AWPHX Ventana Lakes N. of Beardsley Lake City of Peoria - Right of Way City of Peoria - Pioneer Park City of Peoria Padre's Pump Station Desert Harbor Lake Liberty High School Westwing Mountain HOA Sun Garden Park II HOA Pleasant Valley HOA Christ's Church of the Valley Centennial High School Avg Monthly Water Usage 16,229 13,559 13,273 8,640 8,019 7,578 7,273 6,659 6,199 6,010 Type of User Commercial Landscape Golf Course Golf Course Water Company City Park Health Care Facility Residential Constuction Homeowner's Association Right of Way Landscape City Park Sports Complex Homeowner's Association Public School Homeowner's Association Homeowner's Association Homeowner's Association Church Public School Water usage measured in thousands of gallons Source: City customer service and billing records (concluded) 139 Rank 1 2 3 4 5 6 7 8 9 10 % Avg Monthly Water Usage 2.07% 1.89% 1.82% 1.19% 1.04% 1.00% 0.86% 0.82% 0.82% 0.80% Avg Monthly Water Usage 3,436 Rank 4 % Avg Monthly Water Usage 0.48% 3,541 3 0.49% 6,758 6,642 2,326 1,961 1,922 1,704 1,629 1,488 1 2 5 6 7 8 9 10 0.94% 0.92% 0.32% 0.27% 0.27% 0.24% 0.23% 0.21% CITY OF PEORIA, ARIZONA OUTSTANDING DEBT BY TYPE LAST TEN FISCAL YEARS 2015 2014 Governmental Activities General Obligation Bonds $ General Obligation WIFA Loans Municipal Development Authority Debt Obligat Excise Tax Revenue Obligations Direct Purchase and Loan Obligations Special Assessment Bonds Community Facilities District Bonds 152,820,000 81,035,000 3,195,000 51,095,000 Business-type Activities Water and Sewer Revenue Bonds WIFA Loans 32,720,000 77,780,535 $ 2016 145,088,146 77,797,482 2,865,416 48,409,540 $ 29,669,224 73,235,496 Table XV 2017 170,995,550 73,257,994 2,508,814 40,575,685 $ 24,622,433 78,549,337 2018 158,031,697 68,529,573 2,137,211 40,400,804 $ 19,095,643 74,229,903 2019 8,412,062 62,724,636 $ 325,739,598 $ 298,202,194 $ 289,356,757 $ 362,921,663 $ 360,277,212 $ $ 1,561.39 $ 1,515.08 $ 1,865.76 $ 1,806.59 $ 377,065,304 $ 390,509,813 $ 362,424,831 $ 327,826,497 Total Debt Per Capita $ 2,565.75 $ 2,350.33 $ 2,378.08 $ 2,154.83 $ 1,903.06 6.4% 5.8% 5.7% 5.1% Source: City financial records. Debt schedule exhibits and Long-term liability activity footnote 140 4.4% 1,851.20 4.1% $ 4,665,273 57,320,925 3.8% 128,984,480 3,954,426 28,437,337 23,415,375 29,993,568 $ 2023 13,383,853 70,004,831 398,645,535 142,247,708 3,000,000 30,620,436 27,130,287 33,217,566 2022 $ 157,167,099 32,753,534 30,761,347 33,920,919 $ $ 2021 135,863,947 34,792,700 36,514,304 37,266,862 Total Primary Government Total Debt as a % of Personal Income 2020 41,331,911 33,239,660 3.7% 174,891,326 3,724,398 24,222,767 19,621,324 25,450,008 $ 66,293,549 48,718,291 3.9% 182,957,316 7,063,285 23,469,990 15,747,839 24,604,581 60,975,592 45,458,610 3.5% CITY OF PEORIA, ARIZONA RATIO OF NET GENERAL BONDED DEBT TO FULL CASH VALUE AND NET BONDED DEBT PER CAPITA LAST TEN FISCAL YEARS Table XVI Fiscal Year 2015 2014 Bonded Debt (1) Less: $ 152,820,000 $ 123,895,463 Debt Service Reserves (2) Net Bonded Debt 2016 $ 145,088,146 $ 119,229,075 28,924,537 2017 $ 170,995,550 $ 144,412,048 25,859,071 2018 $ 158,031,697 $ 132,501,730 26,583,502 2019 $ 135,863,947 $ 119,976,753 25,529,967 2020 2021 $ 157,167,099 17,095,199 16,376,110 $ 140,071,900 $ 125,871,598 15,887,194 $ 142,247,708 2022 $ 128,984,480 $ 110,706,795 2023 $ 174,891,326 $ 155,217,985 18,277,685 $ 182,957,316 $ 163,890,911 19,673,341 19,066,405 Percentage of Net Bonded Debt to Full Cash Value 1.2% 1.1% 1.0% 0.9% 0.7% 0.8% 0.6% 0.5% 0.6% 0.6% Percentage of Net Bonded Debt to Assessed Value (3) 11.7% 10.3% 12.3% 10.6% 9.0% 9.7% 8.1% 6.7% 8.7% 8.7% Net Bonded Debt Per Capita $785 $743 $879 $788 $696 $796 $659 $569 $798 $822 Net Bonded Debt as a % of Personal Income 1.99% 1.83% 2.12% 1.87% 1.62% 1.77% 1.51% 1.25% 1.66% 1.58% (1) Represents face value of general obligation debt outstanding plus deferred bond premiums (2) Fund balance of GO Bond Debt Service Fund per the fund financial statements (3) Prior to FY2015-16, Primary or Limited Property Values were used for primary ad valorem taxes which are levied for operations of the city and Secondary Assessed Values were used for secondary ad valorem taxes which are levied for debt service. Beginning in FY2015-16, with a voter approved constitutional amendment, both primary and secondary ad valorem taxes are now levied on the Limited Property Values. Because FY2015-16 is the first year for implementation of the constitutional amendment and use of Limited Property Values, there is no comparative data from prior years and accordingly the Net Assessed Values presented for years prior to FY2015-16 represent Secondary Assessed Values based on the then-applicable but now replaced valuation rules. Note: Personal income and population information may be found on Table XXV Full cash value information may be found on Table VIII 141 Table XVII CITY OF PEORIA, ARIZONA DIRECT AND OVERLAPPING GENERAL OBLIGATION BONDED DEBT - CURRENT FISCAL YEAR AS OF JUNE 30, 2023 Governmental Unit Overlapping: State of Arizona Maricopa County Maricopa County Community College District Maricopa County Flood Control District Maricopa County Library District Maricopa County Fire District Assistance Maricopa County Special Health Care District Central AZ Water Conservation West MEC Vocational District Sub-total - City-wide overlapping Total City-wide debt levies (3) $ Unified School Districts: Peoria No. 11 Deer Valley No. 97 Nadaburg No. 81 Sub-total - Unified school district overlapping Total overlapping Limited Assessed Valuation General Obligation Bonds Outstanding (2) 78,405,598,978 51,575,018,189 51,575,018,189 47,553,260,925 51,575,018,189 51,575,018,189 51,932,898,351 51,932,898,351 19,300,490,997 $ Percentage Applicable to City of Peoria (1) Secondary Tax Rate per $100 Assessed Amount Applicable to City of Peoria 135,585,000 677,938,352 130,195,000 2.41% 3.67% 3.67% 3.98% 3.67% 3.67% 3.64% 3.64% 9.80% $ 4,970,751 24,682,971 12,754,861 42,408,583 221,024,307 1,624,439,186 270,162,765 1,776,482 153,065,000 127,500,000 2,169,000 69.97% 8.28% 1.70% 107,099,581 10,557,000 36,873 117,693,454 160,102,037 $1,890,818,254 $178,615,724 100.00% 178,615,724 $ 0.10 0.16 0.05 0.01 0.25 0.14 0.15 2.23 2.31 0.17 Direct: City of Peoria (4) Total direct and overlapping debt $ 338,717,761 Notes: Overlapping governments are those that coincide, at least in part, with the geographical boundaries of the city. This table estimates the portion of outstanding debt of those overlapping governments that is borne by the residents and businesses in the city. This process recognizes that, when considering the city'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. Does not include debt amount of Community Facilities Districts ($24,604,581) (1) Percentage applicable to the City is computed on the ratio of secondary assessed valuation. (2) Includes total stated principal amount of general obligation bonds outstanding. Does not include certificates of participation, revenue obligations or loan obligations outstanding for the jurisdictions listed. (3) Total City-wide debt levies are County debt plus City debt. (4) Includes the GO WIFA loans as these are general obilgation debt and restricted by the same constraints as general obligation bonds. Sources: - City of Peoria financial records - Maricopa County Treasurer - Maricopa County Assessor - State of Arizona, Department of Revenue, Abstract of the Assessment Roll - Individual jurisdictions' ACFRs and official statements 142 $ 1.15 CITY OF PEORIA, ARIZONA DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT - CURRENT FISCAL YEAR AS OF JUNE 30, 2023 Limited Assessed Valuation Governmental Unit Overlapping: State of Arizona Maricopa County Maricopa County Community College District (3) Maricopa County Flood Control District Maricopa County Library District Maricopa County Fire District Assistance Maricopa County Special Health Care District Central AZ Water Conservation West MEC Vocational District Sub-total - City-wide overlapping Total City-wide debt levies (4) $ 78,405,598,978 51,575,018,189 51,575,018,189 47,553,260,925 51,575,018,189 51,575,018,189 51,932,898,351 51,932,898,351 19,300,490,997 Unified School Districts: Peoria No. 11 Deer Valley No. 97 Nadaburg No. 81 Sub-total - Unified school district overlapping Total overlapping Direct: City of Peoria Debt Outstanding (2) $ 1,624,439,186 270,162,765 1,776,482 $ 1,890,818,254 Percentage Applicable to City of Peoria (1) $ Table XVIII 135,585,000 130,195,000 2.41% 3.67% 3.67% 3.98% 3.67% 3.67% 3.64% 3.64% 9.80% 153,065,000 127,500,000 2,169,000 69.97% 8.28% 1.70% 107,099,581 10,557,000 36,873 117,693,454 135,419,066 100.00% 253,843,011 253,843,011 (5) Total direct and overlapping debt $ $ 4,970,751 12,754,861 17,725,612 271,568,623 389,262,077 Notes: Overlapping governments are those that coincide, at least in part, with the geographical boundaries of the city. This table estimates the portion of outstanding debt of those overlapping governments that is borne by the residents and businesses in the city. This process recognizes that, when considering the city'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. (1) Percentage applicable to the City is computed on the ratio of secondary assessed valuation. (2) Includes total stated principal amount of general obligation bonds outstanding. Does not include certificates of participation, revenue obligations or loan obligations outstanding for the jurisdictions listed. (3) Although Maricopa County Community Colleges reports all activity as Business-Type, since the general obligation bonds are repaid solely from tax collections, they will be included with governmental activities. (4) Total City-wide debt levies are County debt plus City debt. (5) GO WIFA Loan is included in the total debt because it was paid for through secondary property taxes. Although the project falls uner the Storm Drain Utility, the City is utilizing secondary property taxes to pay the debt and the debt is secured by the full faith and credit of the City. Sources: - City of Peoria financial records - Maricopa County Treasurer - Individual jurisdictions' ACFRs and official statements - Maricopa County Assessor - State of Arizona, Department of Revenue, Abstract of the Assessment Roll 143 Secondary Tax Rate per $100 Assessed Amount Applicable to City of Peoria $ 0.10 0.16 0.05 0.01 0.25 0.14 0.15 2.23 2.31 0.17 $ 1.15 CITY OF PEORIA, ARIZONA DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT LAST TEN FISCAL YEARS Governmental Unit 2014 Overlapping: State of Arizona Maricopa County Community College District County Flood Control District County Free Library Fire District Assistance Education Equalization West MEC Vocational District Central AZ Water Conservation Sub-total - City-wide overlapping Total City-wide levies (1) $ Unified School Districts: Peoria No. 11 Deer Valley No. 97 Nadaburg No. 81 Sub-total - Unified school district overlapping 23,384,382 3,198,843 26,583,225 317,946,402 Fiscal Year 2016 2015 $ 21,550,210 3,025,964 24,576,174 298,736,758 $ 20,203,810 6,722,916 26,926,726 314,264,769 2017 $ 2018 17,547,206 13,247,434 30,794,640 188,826,337 $ 15,609,534 13,266,411 28,875,945 236,046,896 Table XIX 2019 $ 13,561,370 12,333,671 25,895,041 280,497,941 2020 $ 11,260,680 11,410,853 22,671,533 258,887,529 2021 $ 9,077,824 10,721,153 19,798,977 234,584,163 2022 $ 6,751,740 14,233,479 20,985,219 274,828,230 2023 $ $ 4,970,751.00 $ 12,754,861.00 17,725,612 271,568,623 208,200,535 27,264,686 2,286 180,916,246 25,506,618 1,212 219,811,259 26,927,344 789 186,654,480 30,347,141 579 160,934,200 16,287,234 12,519 161,744,660 14,099,937 8,541 135,901,818 15,421,516 6,105 120,868,113 15,477,532 72,893 116,652,993 13,338,388 41,694 107,099,581 10,557,000 36,873 235,467,507 206,424,076 246,739,392 217,002,200 177,233,953 175,853,138 151,329,439 136,418,538 130,033,075 117,693,454 Total overlapping 262,050,732 231,000,250 273,666,118 247,796,840 206,109,898 201,748,179 174,000,972 156,217,515 151,018,294 135,419,066 Direct (2): City of Peoria 291,363,177 274,160,584 287,338,043 158,031,697 207,170,951 254,602,900 236,215,996 214,785,186 253,843,011 253,843,011 505,160,834 $ 561,004,161 $ 405,828,537 $ 413,280,849 456,351,079 $ 410,216,968 $ 371,002,701 $404,861,305 $389,262,077 Total direct and overlapping debt $ 553,413,909 $ $ (1) - Total City-wide debt levies are County debt plus City debt. (2) - Due to a recommended change in accounting principle, the contracts payable category is no longer being used to calculate direct governmental activities debt. Sources: City Financial Records Individual jurisdictions' CAFRs and official statements for debt of other entities 144 Table XX CITY OF PEORIA, ARIZONA LEGAL DEBT MARGIN LAST TEN FISCAL YEARS Fiscal Year 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Property Assessed Value (1) $ 1,057,413,204 $ 1,155,587,438 $ 1,178,016,995 $ 1,244,679,295 $ 1,340,068,217 $ 1,439,812,989 $ 1,556,721,002 $ 1,659,175,244 $ 1,780,974,057 $ 1,890,818,254 6% Limitation Debt limit $ 63,444,792 $ 69,335,246 $ 70,681,020 $ 74,680,758 $ 80,404,093 $ 86,388,779 $ 93,403,260 $ 99,550,515 $ 106,858,443 $ 113,449,095 Total net debt applicable to limit Legal 6% Debt Margin 350,000 $ Total net debt applicable to the limit as a percentage of debt limit 20% Limitation Debt limit $ 0.6% $ Total net debt applicable to limit Legal 20% Debt Margin 63,094,792 - 211,482,641 Total net debt applicable to the limit as a percentage of debt limit 59,012,641 72.1% $ 0.0% $ 152,470,000 $ 69,335,246 4,814,727 231,117,488 88,192,488 61.8% $ 6.8% $ 142,925,000 $ 65,866,293 4,149,727 235,603,399 80,258,126 65.9% $ 5.6% $ 155,345,273 $ 70,531,031 2,999,727 248,935,859 104,845,586 $ 3.7% $ 144,090,273 $ 77,404,366 4,526,273 268,013,643 57.9% 143,958,370 46.3% $ 92,461,987 5.2% $ 124,055,273 $ 81,862,506 941,273 287,962,598 146,308,871 49.2% $ 311,344,200 $ 174,632,343 43.9% 145 99,550,515 6,398,560 $ 0.0% $ 136,711,857 (1) Prior to FY2015-16, Primary or Limited Property Values were used for primary ad valorem taxes which are levied for operations of the city and Secondary Assessed Values were used for secondary ad valorem taxes which are levied for debt service. Beginning in FY2015-16, with a voter approved constitutional amendment, both primary and secondary ad valorem taxes are now levied on the Limited Property Values. Because FY2015-16 is the first year for implementation of the constitutional amendment and use of Limited Property Values, there is no comparative data from prior years and accordingly the Net Assessed Values presented for years prior to FY2015-16 represent Secondary Assessed Values based on the then-applicable but now replaced valuation rules. Source: Maricopa County Assessor and City records $ 1.0% 141,653,727 $ - 331,835,049 206,588,320 37.7% $ 6.0% $ 125,246,729 $ 100,459,883 6,483,342 356,194,811 5.7% $ 190,765,335 $ 165,429,476 53.6% 106,965,753 378,163,651 193,774,041 $ 184,389,610 51.2% CITY OF PEORIA, ARIZONA PLEDGED REVENUE COVERAGE - EXCISE TAX AND STATE SHARED REVENUE DEBT OBLIGATIONS GOVERNMENTAL PORTION LAST TEN FISCAL YEARS Table XXI Fiscal Year 2015 2014 2016 2017 2018 (6) 2019 2020 2021 2022 2023 Senior Lien Excise Tax and State Shared Revenue Debt Obligations Pledged Revenues Sales and use taxes (1) State-shared sales tax Urban revenue sharing Franchise taxes License and permits Fines and forfeitures User fees and charges Miscellaneous Total Pledged Revenues Senior Lien Debt Service Requirements Principal (2) Interest (2) Total Senior Lien Debt Service Requirements $ $ Estimated Coverage 60,587,446 13,431,637 17,172,500 4,194,371 2,800,894 1,933,142 12,535,479 1,379,952 114,035,421 2,010,000 1,708,383 3,718,383 $ $ 30.67 63,331,915 14,139,128 18,650,521 4,312,836 3,132,178 1,699,818 12,703,987 2,146,784 120,117,167 2,020,000 1,642,083 3,662,083 $ 67,425,794 14,760,029 18,549,406 4,461,864 4,080,210 1,601,014 11,998,841 2,341,988 125,219,146 2,085,000 1,567,808 3,652,808 $ 32.80 $ $ 34.28 71,476,726 15,631,512 20,949,613 4,501,681 4,778,632 1,433,868 14,376,186 2,980,499 136,128,717 2,165,000 1,483,533 3,648,533 $ $ 37.31 76,168,326 15,894,140 20,334,388 5,035,331 5,509,240 1,728,303 16,758,517 4,696,224 146,124,469 2,361,806 1,385,086 3,746,892 $ 79,020,319 17,018,021 20,366,698 4,925,609 5,720,889 2,241,580 16,881,528 5,452,362 151,627,006 2,265,000 1,232,635 3,497,635 $ 39.00 $ $ 43.35 84,429,889 17,079,368 22,275,583 4,776,257 4,929,081 1,249,763 15,897,926 4,547,082 155,184,949 2,475,000 1,157,476 3,632,476 $ $ 42.72 96,328,365 20,186,716 25,147,285 4,965,951 5,287,497 1,436,969 14,599,930 2,400,673 170,353,386 2,535,000 1,091,061 3,626,061 $ $ 46.98 106,277,624 28,070,949 24,816,247 4,961,622 5,100,898 1,619,089 18,305,648 2,257,340 191,409,417 2,610,000 1,004,220 3,614,220 $ $ 52.96 111,004,429 28,812,810 36,976,059 5,240,846 3,650,883 1,643,286 22,070,286 5,054,250 214,452,849 900,000 788,890 1,688,890 126.98 Other Excise Tax and State Shared Revenue Debt Obligations (3) Net Pledged Revenues from above (4) Additional Pledged Revenues (5) Total Debt Service Requirements Principal Interest Total Annual Requirements Estimated Coverage Note: $ $ 110,317,038 10,861,145 121,178,183 2,185,000 1,730,263 3,915,263 30.95 $ $ 116,455,084 11,334,889 127,789,973 2,285,000 1,648,325 3,933,325 $ 121,566,339 12,231,059 133,797,398 $ 2,385,000 1,545,500 3,930,500 32.49 34.04 $ $ 132,480,184 12,939,338 145,419,522 2,490,000 1,438,175 3,928,175 $ $ 37.02 142,377,577 13,977,877 156,355,454 2,665,000 1,114,408 3,779,408 $ 148,129,371 15,203,014 163,332,385 $ 3,015,000 507,374 3,522,374 41.37 (1) Excludes the 0.3% Transportation Sales Tax approved by voters in September 2005. (2) Although the pledged revenues for all Senior Lien Debt Obligations are excise taxes and state shared revenues (excluding the 0.3% Transportation Sales Tax), some debt service payments, including the 2011 MDA Debt Obligation, are funded by Enterprise Funds. (3) Other Excise Tax and State Shared Revenue Debt Obligations are backed by a senior lien on the .03% transaction privilege tax approved by voters in 2005 and a subordinated lien on the Excise Taxes and State Shared revenues listed above. (4) Pledged revenues on the Senior Lien Debt Obligations, less the debt requirements for the Senior Lien Debt Obligations (5) Revenues of the Transportation Sales Tax Fund, primarily consisting of the 0.3% transaction privilege tax in Note (1). (6) During FY2018, the 2006 and 2008 MDA debt obligations were refunded using direct purchase obligations. As part of the refunding the City deposited $3,128,884, which was available for upcoming debt service payments for the debt being refunded, with the bond escrow agent. This amount is included in debt principal and interest listed above. Source: Statement of Revenues, Expenditures and Changes in Fund Balances - Governmental Funds Debt service schedules, City financial records 146 46.37 $ $ 151,552,473 16,080,887 167,633,360 3,065,000 447,978 3,512,978 47.72 $ $ 166,727,325 17,469,832 184,197,157 3,130,000 387,598 3,517,598 52.36 $ $ 187,795,197 19,363,508 207,158,705 3,195,000 325,937 3,520,937 58.84 $ $ 212,763,959 20,975,746 233,739,705 3,255,000 262,995 3,517,995 66.44 Table XXII CITY OF PEORIA, ARIZONA PLEDGED REVENUE COVERAGE - WATER AND WASTEWATER REVENUE BONDS LAST TEN FISCAL YEARS Fiscal Year 2015 2014 Gross Revenue (1) Operating and Maintenance Expenses (2) Net Revenue Available for Debt Service $ 54,515,296 30,942,736 23,572,560 $ 2016 52,770,260 35,326,061 17,444,199 $ 2017 60,010,324 33,060,448 26,949,876 $ 2018 64,032,933 35,787,927 28,245,006 $ 2019 69,512,706 38,664,295 30,848,411 $ 2020 69,682,089 39,616,866 30,065,223 $ 2021 72,892,452 47,802,256 25,090,196 $ 2022 78,379,187 49,575,457 28,803,730 $ 2023 75,671,386 61,522,222 14,149,164 $ 83,570,126 62,584,753 20,985,373 Development Fee Revenue Total Net Revenue 4,311,153 27,883,713 4,418,565 21,862,764 5,116,972 32,066,848 6,268,689 34,513,695 6,034,425 36,882,836 6,529,816 36,595,039 6,911,813 32,002,009 9,163,448 37,967,178 6,932,135 21,081,299 2,541,541 23,526,914 Debt Service Requirements Principal (3) Interest (4) Total Debt Service Requirements 9,007,117 3,343,413 12,350,530 9,210,038 3,097,542 12,307,580 9,456,159 3,026,940 12,483,099 10,635,513 2,621,761 13,257,274 10,983,985 2,567,632 13,551,617 12,431,144 2,001,074 14,432,218 11,433,344 1,683,084 13,116,428 52,166,353 1,597,208 53,763,561 8,304,058 1,862,828 10,166,886 7,819,681 2,955,952 10,775,633 $ $ $ $ $ $ $ $ $ $ Ratio of Total Net Revenue/ Total Bond Expense 2.26 1.78 2.57 2.60 2.72 2.54 2.44 0.71 2.07 2.18 Ratio of Net Available/ Total Bond Expense (5) 1.91 1.42 2.16 2.13 2.28 2.08 1.91 0.54 1.39 1.95 (1) Includes total operating revenues and investment income of the Water Utility and Wastewater Utility Enterprise Funds. (2) Includes total operating expenses of the Water Utility and Wastewater Utility Enterprise Funds, less depreciation and amortization. (3) Includes principal for Water and Sewer Revenue bonds and Water Infrastructure Finance Authority loans. Although some MDA bonds are financed by the Utility Funds, the pledged revenue is excise tax therefore the debt is included in the MDA Bond debt coverage calculations on Table XXI. (4) Bond interest payments only. Does not include amortization of loss on refunding, capitalized interest, agent fees or amortization of bond issuance costs that are included in interest expense on the statement of revenues, expenses, and changes in net position. (5) Excludes Development Fee Revenue. (6) In FY2012 $24,810,509 in principal and $405,829 in interest were defeased. These additional debt payments have been removed from the FY12 debt service requirements so as not to distort the ratios. Source: Statement of Revenues, Expenses, and Changes in Fund Net Position Repayment schedules for debt serviced by Water and Wastewater Utility Enterprise funds 147 CITY OF PEORIA, ARIZONA PLEDGED REVENUE COVERAGE - SPECIAL ASSESSMENT BONDS LAST TEN FISCAL YEARS Pledged Revenues (1) Debt Service Requirements Principal Interest (2) Total Annual Requirements 2014 2015 2016 2017 2018 $ 1,259,303 $ 1,168,526 $ 1,078,196 $ 2,787,558 $ 2,130,000 325,000 149,600 474,600 340,000 135,788 475,788 355,000 121,338 476,338 370,000 106,250 476,250 2,130,000 90,825 $ 2,220,825 5.85 0.96 $ Estimated Coverage 2.65 $ 2.46 $ 2.26 $ 2019 Table XXIII 2020 $ - $ - 2021 $ - $ - - - 2022 $ - $ - (1) - Pledged revenues equals Special Assessment Debt Service Fund current year fund balance plus current year principal & interest payments. (2) - Bond interest payments only. Does not include agent fees included in interest expense on the Statement of Revenues, Expenditures and Changes in Fund Balance. Source: City financial records Governmental Fund Financial Statements 148 2023 $ - $ - $ - $ - Table XXIV CITY OF PEORIA, ARIZONA SPECIAL ASSESSMENT COLLECTIONS LAST TEN FISCAL YEARS Current Assessments Due 2014 (3) $ 455,116 Fiscal Year 2015 (4) $ 381,761 Assessments Collected Prepaid Assessments Collected Total Assessments Collected (1) 455,116 675,958 $ 1,131,074 381,761 381,761 Ratio of Current Collections to Amount Due Outstanding Assessment Principal (2) $ $ 2016 (5) 381,950 2017 (6) $344,741 $ 381,950 381,950 344,741 1,809,173 $2,153,914 100.0% 100.0% 100.0% 100.0% $ 2,603,127 $ 2,326,112 $ 2,036,876 $0.00 2018 2019 $ - $ - 2020 $ - $ - - $ - - $ - 2023 $ - $ - $ - $ - N/A N/A N/A N/A N/A $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 (2) Principal only. Assessments Receivable on Balance Sheet-Governmental Funds may include delinquent administrative charges, interest and penalties. (3) These Special Assessments relate to Improvement District 0601 which includes three lots. The tax rolls of Maricopa County Assessor's Office indicate that the current full cash value of the Assessed Property is approximately $25,957,000 for Lot No. 1, $17,577,500 for Lot No. 2 and $669,500 for Lot No. 3. There are no overlapping Assessment Districts and all lots are current in their assessment payments. (4) These Special Assessments relate to Improvement District 0601 which includes three lots. The tax rolls of Maricopa County Assessor's Office indicate that the current full cash value of the Assessed Property is approximately $25,957,000 for Lot No. 1, $23,400,000 for Lot No. 2 and $669,500 for Lot No. 3. There are no overlapping Assessment Districts and all lots are current in their assessment payments. (5) These Special Assessments relate to Improvement District 0601 which includes three lots. The tax rolls of Maricopa County Assessor's Office indicate that the current full cash value of the Assessed Property is approximately $30,000,000 for Lot No. 1, $21,066,600 for Lot No. 2 and $770,300 for Lot No. 3. There are no overlapping Assessment Districts and all lots are current in their assessment payments. (6) These Special Assessments relate to Improvement District 0601 which includes three lots. The tax rolls of Maricopa County Assessor's Office indicate that the current full cash value of the Assessed Property is approximately $30,000,000 for Lot No. 1, $25,285,800 for Lot No. 2 and $733,200 for Lot No. 3. There are no overlapping Assessment Districts and all lots are current in their assessment payments. 149 2022 $ N/A (1) Does not include penalties or administrative fees which are included in special assessment revenues on the Statement of Revenues, Expenditures and Changes in Fund Balance - Governmental Funds. Source: City financial records and reports 2021 $ Table XXV CITY OF PEORIA, ARIZONA DEMOGRAPHIC AND ECONOMIC STATISTICS LAST TEN FISCAL YEARS Fiscal Year 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Population (1) 157,770 160,431 164,212 168,192 172,263 175,961 190,985 194,517 199,424 199,424 Personal Income (in thousands) (2) 6,112,799 6,392,534 6,701,656 7,100,730 7,596,109 8,116,201 9,179,694 10,085,901 11,628,015 (7) N/A Per Capita Personal Income (3) 38,745 39,846 40,811 42,218 44,096 46,125 48,065 51,851 58,308 N/A Median Age (4) 40.2 40.5 36.9 41.6 41.0 39.5 38.2 38.5 42.7 41.0 Public School Enrollment (5) 34,952 34,897 34,966 34,912 35,388 35,490 35,784 34,030 34,495 34,557 Unemployment Rate (6) 6.0% 5.0% 4.9% 4.2% 4.0% 4.3% 9.3% 6.6% 3.4% 3.9% (1) City population for the most current year based on Maricopa Association of Government (MAG) estimates and prior year data is from the U.S. Census. (2) Peoria personal income calculated by multiplying Phoenix Metropolitan Statistical Area (MSA) per capita income times Peoria population divided by 1,000. (3) Bureau of Economic Analysis - Phoenix Metropolitan Statista Area (MSA) (4) US Census Bureau - American Community Surveys (5) Arizona Department of Education (6) US Bureau of Labor Statistics (7) Population for fiscal year 2023 was taken from the most recent U.S. Census estimates for fiscal year 2022 because it is the most updated and accurate population count as of fiscal year 2023. 150 CITY OF PEORIA, ARIZONA MAJOR EMPLOYERS WITHIN THE CITY CURRENT YEAR AND NINE YEARS AGO Table XXVI 2023 Employer Peoria Unified School District City of Peoria Walmart (Multiple Locations) Fry's Food Stores (Multiple Locations) Target Stores Inc (Multiple Locations) Home Depot (Multiple Locations) Taronis Fuels Plaza Del Rio Campus/Freedom Plaza & Care Center Larry Miller Dodge/Hyundai Oak Craft Inc The Younger Brothers Group Inc Immanuel Campus of Care The Antigua Group Inc Arizona Retirement Center Good Shepherd Care Center Total Total City Employment # of Employees 3,805 1,354 1,030 880 450 410 400 380 330 320 2014 Rank 1 2 3 4 5 6 7 8 9 10 9,359 Percentage of Total City Employment 4.0% 1.4% 1.1% 0.9% 0.5% 0.4% 0.4% 0.4% 0.3% 0.3% 9.8% # of Employees 3,047 1,093 523 200 528 456 289 236 130 6,502 95,652 78,056 Sources: City of Peoria Economic Development Department, Maricopa Association of Governments Employer Database, and the U.S. Bureau of Labor Statistics. 151 Rank 1 2 4 8 3 5 6 7 9 Percentage of Total City Employment 3.9% 1.4% 0.0% 0.0% 0.0% 0.0% 0.0% 0.7% 0.0% 0.3% 0.7% 0.6% 0.4% 0.3% 0.2% 8.3% Table XXVII CITY OF PEORIA, ARIZONA AUTHORIZED FULL-TIME EQUIVALENT CITY GOVERNMENT EMPLOYEES BY FUNCTION LAST TEN FISCAL YEARS Full-time Equivalent Employees as of June 30, 2022 2014 General Government City Manager Office of Communications Human Resources Attorney City Clerk Court Economic Development*** Finance & Budget Culture & Recreation Police Fire Community Development Development and Engineering** Highways & Streets Public Works Human Services Water Utility Wastewater Utility Solid Waste Utility Information Technology Stadium Total FTE* Note: 2015 2016 2017 2018 2019 2020 2021 2022 2023 16.00 8.00 17.50 26.00 7.00 20.90 28.00 80.00 115.97 292.00 168.50 13.50 33.25 38.80 57.95 7.50 55.50 29.50 45.50 40.00 17.50 16.00 8.00 17.50 26.00 7.00 20.90 30.50 80.00 115.97 292.00 168.50 14.00 33.25 38.80 57.95 7.50 55.50 29.50 45.50 40.00 17.50 16.00 9.00 19.00 26.00 7.00 20.90 31.50 79.00 119.22 295.00 175.50 15.00 33.25 38.80 57.95 7.50 55.50 31.50 49.50 41.00 17.50 18.00 9.00 19.00 26.00 7.00 20.90 8.00 79.00 121.47 299.00 194.50 16.00 65.00 38.80 57.95 7.50 58.50 32.50 53.25 42.00 18.50 18.00 9.00 20.00 26.00 7.00 20.90 8.00 80.00 121.20 306.00 194.50 16.00 65.00 38.80 57.95 7.50 58.50 32.50 56.25 42.00 18.50 18.00 9.00 20.50 26.00 7.00 20.90 7.00 79.00 145.78 303.00 212.00 12.92 67.25 38.80 58.95 9.50 61.50 33.50 58.25 42.00 18.50 19.00 10.00 21.50 26.00 7.00 20.90 7.00 78.00 155.80 304.00 220.00 13.00 67.00 39.80 58.95 9.50 63.50 34.50 61.00 43.00 18.50 19.00 10.00 21.50 26.00 6.00 20.90 7.00 78.00 155.80 305.00 220.00 13.00 67.00 39.80 58.95 9.50 69.50 35.50 61.00 45.00 18.50 19.00 10.00 21.50 27.00 6.00 21.45 7.00 79.00 188.10 308.00 236.00 13.00 70.00 40.8 57.95 10.50 72.50 35.50 62.00 45.00 17.96 19.00 10.00 21.50 29.00 6.50 23.45 7.00 79.00 161.85 323.00 241.00 14.00 72.00 42.8 59.95 11.00 67.50 37.50 64.00 47.00 17.90 1,118.87 1,121.87 1,145.62 1,191.87 1,203.60 1,249.35 1,277.95 1,286.95 1,348.26 1,354.95 Counts do include part-time non-seasonal benefitted employees. *The Total FTE presentation for years 2008-2013 was updated to reflect a calculation correction. **The presentation was updated in fiscal year 2017 to reflect the renaming of departments. Source: City budget office 152 2014 Governmental Activities: General Government Registered Voters in City Voter Participation (last election) Culture & Recreation Recreation Participants New Recreation Accounts Special Event Participants Police Calls for Service Avg Response Time (minutes) Fire Number of Incidents Avg Response Time (minutes) Development Services Building Permits Issued Value of Building Permits (millions $) Highways & Streets Asphalt Used (in tons) Centerline Miles Swept Miles Inspected Public Works Number of Vehicle Work Orders Human Services Number of Dial-a-Ride users Number of Annual Trips Business-type Activities Water Utility (E) Annual Consumption (000's gal) Wastewater Utility Wastewater Treated (billion gal) Solid Waste Utility Residential Tonnage Processed Commercial Tonnage Processed Recycle Tonnage Processed Stadium Spring Training Attendance Sporting Rentals Days Non-Sporting Rentals Days CITY OF PEORIA, ARIZONA OPERATING INDICATORS BY FUNCTION/PROGRAM LAST TEN FISCAL YEARS Fiscal Year 2015 2016 2017 2018 2019 Table XXVIII 2020 2021 2022 2023 89,604 24.9% 87,541 31.3%(F) 93,916 N/A 101,881 76.7% 102,460 N/A 109,073 36.48% 113,282 41.33% 124,458 83.87% 118,397 N/A 119,718 67.66% 122,318 5,533 74,950 120,232 5,483 79,550 104,544 5,166 71,300 109,220 5,396 102,938 112,802 5,029 95,822 116,696 4,344 88,348 64,170 2,255 107,120 11,976 4,325 5,706 18,672 6,610 102,775 18,108 7,128 110,750 52,193 4.39 (C) 47,612 4.55 (C) 53,256 5.13 (C) 55,136 5.40 (C) 53,574 5.33 (C) 51,127 5.28 51,081 5.23 51162 5.36 55197 5.47 54497 5.25 19,312 5.30 20,873 5.24 23,824 5.38 23,726 5:16(A) 24,932 5:24(A) 23,752 5:25(A) 25,066 5:47(A) 25,559 5:51(A) 24,859 5:36(A) 28,509 6:22(A) 3,993(D) $188.3 4,534(D) $221.1 5,818(D) $311.9 6,336(D) $393.3 6,231(D) $355.0 5,701 (D) $382.1 5,795 (D) $307.7 6,764 (D) $298.3 6,151 $313.0 4,369 $164.3 2,227 5,660 2,302 4,968 1,289 4,118 1,930 6,199 1,566 5,052 1,394 6,405 2,189 7,205 2,496 8,555 1,174 8363 1,185 8,719 205 211 296 1,551(G) 0(G) 0(G) 867 (G) 0(G) 0(G) 0(G) 5,464 5,493 5,558 5,732 5,416 5,592 5,385 4957 4821 4857 836 33,308 850 30,212 749 30,756 585 27,241 599 28,033 599 22,954 387 22,257 399 15,987 425 21,878 402 22,656 8,662,507 8,090,136 8,650,664 9,488,059 9,950,302 9,630,290 9,660,709 10,661,260 10,197,595 9,640,256 3.69 3.74 3.78 3.87 3.98 4.13 4.21 4.29 4.36 4.41 47,987 21,176 15,155 51,666 25,227 16,077 52,593 23,309 16,447 54,967 20,895 16,698 55,757 20,974 17,109 59,819 16,748 16,859 64,283 19,165 16,047 67,087 18,066 17,729 68,856 17,691 17,417 66,290 19,001 17,070 192,513 322 146 238,847 297 151 240,111 339 204 227,646 333 210 201,272 335 196 180,190 340 182 93,932 245 133 51,067 255 105 78,928 207 112 217,530 291 135 Notes: * Information is not available for these fiscal years. (A) Decrease in Fire Average Response time reflects change in calculation. Beginning in FY17, average response time is calculated 1st unit on scene and only includes code 3 (emergency calls). (B) Changed from lane miles to center line miles in FY11 to be consistent with other highway measurements. Decrease in Police Average Response time reflects calculation change. New Calculation=Dispatch to Arrival. Previous (D) Beginning FY13, this number includes all permits issued including tenant improvements, C of O permits, and spec suite permits. (E) Beginning in FY15, Average Gallons/Household/Year is no longer being presented. (F) Percentage reflects voter participation in March 2015 Special General Election for Mesquite District Council. Eligible registered voters = 16,582. (G) Starting In FY17 an electronic survey of every road is completed every third year. (H) FY2020 number of participants are considerably lower than prior fiscal years because COVID-19 caused programmatic changes and event cancellations. (C) Source:Various City Departments 153 CITY OF PEORIA, ARIZONA CAPITAL ASSET STATISTICS BY FUNCTION/PROGRAM LAST TEN FISCAL YEARS Governmental Activities: General Government Annexed Area (square miles) Culture & Recreation # of Neighborhood Parks Total Neighborhood Park Acreage # of Community Parks Total Community Park Acreage Public Safety Police Stations Marked Patrol Vehicles (units) Fire Stations (full-time / part-time) Number of Fire Engines (B) Number of Ladder Trucks Highways & Streets Streets (miles maintained) Crack Seal Application (linear feet) Surface Treatments (lane miles) Public Works Street Lights Vehicles in Fleet Water Services Number of Pump Stations Number of Lift Stations Number of Wells Number of Reservoirs Human Services Dial-a-Ride Buses Business-type Activities Water Utility Number of Water Accounts Storage Capacity (million gal) Wastewater Utility Number of Wastewater Accounts Treatment Capacity million gallon per Solid Waste Utility Number of Solid Waste Accounts Stadium Number of Practice Fields Number of Clubhouses Total Complex Acreage (C) Table XXIX 2014 2015 Fiscal Year 2016 2017 2018 2019 2020 2021 2022 2023 179.1 179.1 179.1 179.1 179.1 179.1 179.1 179.1 179.1 179.1 33 294 2 139 34 305 2 139 34 301 2 139 34 301 2 139 34 301 2 139 34 301 2 139 34 301 2 139 35 311 3 225 36 314 3 225 36 314 3 225 2 88 2 88 2 90 2 91 2 92 2 98 2 105 2 106 2 108 2 111 7/1 7 2 7/1 7 2 8/0 7 2 8/0 7 2 8/0 7 2 8/0 7 2 8/0 7 2 8/0 7 2 8/0 8 2 8/0 8 2 1452(A) 1,165,460 88 1505(A) 1,156,722 96 1,534 2,144,476 60 1,551 2,007,173 99 1,559 3,381,554 153 1,579 2,447,248 136(D) 1,596 3,670,620 119 1,604 3,434,915 120 1,635 3,587,669 145 1,668 2,549,676 99 14,786 738 14,945 732 15,565 778 15,722 795 15,973 840 16,152 842 16,493 878 16,896 953 17,235 969 17,251 971 25 15 38 30 25 14 40 30 30 13 46 33 30 13 47 33 30 13 47 33 27 11 24 22 30 13 47 33 27 14 47 34 27 14 47 34 27 15 47 34 6 5 5 5 5 6 4 6 6 6 50,399 42.0 51,405 42.0 55,558 42.0 57,011 42.0 58,061 42.0 59,185 42.0 60,705 42.0 62,083 42.0 63,357 42.0 63,575 43.0 53,548 16.25 54,599 16.25 56,235 16.25 57,909 16.25 59,499 16.25 60,913 16.25 62,617 16.25 63,924 16.25 65,169 16.25 65,923 16.25 51,609 52,640 54,262 55,828 57,452 58,816 60,123 61,332 62,575 63,323 13 3 125 13 3 125 13 3 125 13 3 125 13 3 125 13 3 125 13 3 125 13 3 125 13 3 125 13 3 125 Notes: * Information not tracked during this fiscal year. (A) Measurement changed from center-lane miles to lane miles in FY14. (B) Number of fire engines reported in FY13, FY14, FY15 and FY16 was restated to exclude a bush truck previously reported as a fire engine. (C) Number updated in FY17 for all years presented to reflect land owned by the City which was used to construct office space, and thus not part of Stadium complex acreage. (D) Number of Surface treatments for FY19 was restated due to query error in FY19 that was corrected in FY20. Source: Various City Departments 154 Continuing Disclosures Continuing Disclosure Section SEC Rule 15c2-12, as amended, requires the City to provide Continuing Disclosure Annual Reports that include audited financial statements and other financial information for the benefit of owners and holders of bond obligations issued by the City. The Continuing Disclosure Annual Report shall contain or incorporate by reference certain information as set forth in the Continuing Disclosure Agreements and Undertakings executed by the City with the issuance of its municipal bond obligations. Information in this section is provided solely pursuant to the requirements of SEC Rule 15c2-12 and Continuing Disclosure Agreements and Undertakings and include financial information that is not required for fair presentation in conformity with accounting principles generally accepted in the United States of America and is therefore unaudited and not covered by the auditor’s opinion. Annual continuing disclosure information is filed with the Municipal Securities Rulemaking Board (MSRB) for public access via their Electronic Municipal Market Access (EMMA) system at www.emma.msrb.org. 15 Continuing Disclosures Annual Report For the Year Ended June 30, 2023 Audited Financial Statements The City’s Annual Comprehensive Financial Report for fiscal year ended June 30, 2023, is included as part of this submittal. Other Financial Information Information concerning the outstanding debt by type of bond can be found in the Notes to the Financial Statements, Note 7 Long Term Debt. Other financial information required per the City’s Continuing Disclosure Agreements and Undertakings for each type of bond obligation is incorporated by reference as follows: Statistical Section Page General Obligation Bonds (CUSIP 712838) Assessed values by property classification Table VIII 131 Comparison of assessed value to full cash value Table VIII 131 Comparative assessed values Table IX 132 Direct and overlapping assessed values Direct and overlapping tax rates Table XVII Table X 142 133 Property tax levies and collections Table XIII 136 Direct and overlapping general obligation bonds Direct general obligation debt ratios Table XVII Table XVI 142 141 Legal debt margin and unused borrowing capacity Table XX 145 Net revenues and debt service coverage Table XXII 147 Number of utility service connections Table XIVa 137 Ten largest water users Table XIVc 139 Municipal Development Authority Bonds (CUSIP 71284R and 71285A) Excise tax and state shared revenues and debt service coverage Table XXI 146 Privilege and use tax rates by category Table VI 129 Annual debt service requirements Table XXI 146 Legal debt margin and unused borrowing capacity Table XX 145 Assessed values by property classification Table VIII 131 Property tax levies and collections Table XIII 136 Special assessment collections Table XXIV 149 Water and Wastewater Revenue Bonds (CUSIP 712851) Improvement District Bonds (CUSIP 712844) 156 City of Peoria FINANCE AND BUDGET DEPARTMENT 8401 West Monroe Street Peoria, Arizona 85345 www.peoriaaz.gov