FY 2003 CAFRCITY OF EDGE WA TER,
FLORIDA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE YEAR ENDED
SEPTEMBER 30, 2003
City of Edgewater, Florida
COMPREHENSIVE ANNUAL FINANCIAL REPORT
For The Year Ended September 30, 2003
Prepared by: Finance Department
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INTRODUCTORY SECTION
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CITY OF EDGEWATER
COMPREHENSIVE ANNUAL FINANCIAL REPORT
TABLE OF CONTENTS
Year Ended September 30, 2003
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Page
Introductory Section:
Table of Contents
Letter of Transmittal
iii -viii
GFOA Certificate of Achievement
ix
List of Principal Officials
x
Organizational Chart
xi
Financial Section:
Independent Auditor's Report
1-2
Management's Discussion and Analysis
3 -13
Basic Financial Statements:
Government -Wide Financial Statements:
Statement of Net Assets
14
Statement of Activities
15
Fund Financial Statements:
Balance Sheet - Governmental Funds
• 16
Statement of Revenues, Expenditures and Changes in
Fund Balances - Governmental Funds
17
Reconciliation of the Statement of Revenues, Expenditures and
Changes in Fund Balances of Governmental Funds to the Statement of
Activities
18
Statement of Revenues, Expenditures and Changes in Fund
Balances - Budget and Actual - General Fund
19
Statement of Net Assets - Proprietary Funds
20 -21
Statement of Revenues, Expenses and Changes in
Fund Net Assets - Proprietary Funds
22
Statement of Cash Flows - Proprietary Funds
23 -24
Statement of Fiduciary Net Assets - Fiduciary Funds
25
Statement of Changes in Fiduciary Net Assets - Fiduciary Funds
26
Notes to Financial Statements
27-58
Combining and Individual Fund Statements and Schedules:
Major Governmental Fund:
Schedule of Revenues and Expenditures and Changes in Fund
Balance - Budget and Actual:
Debt Service Fund
59
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CITY OF EDGEWATER
COMPREHENSIVE ANNUAL FINANCIAL REPORT
TABLE OF CONTENTS - Continued
Year Ended September 30, 2003
IV. Other Reports:
Report on Compliance and on Internal Control over Financial
Reporting Based on an Audit of Financial Statements Performed 92 -93
in Accordance With Government Auditing Standards
Management Comments 94 -97
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II. Financial Section - Continued:
Nonmajor Governmental Funds:
Combining Balance Sheet - Nonmajor Governmental Funds
60 -61
Combining Statement of Revenues, Expenditures and Changes
In Fund Balances - Nonmajor Governmental Funds
62 -63
Schedule of Revenues, Expenditures and Changes in Fund
Balances - Budget and Actual:
Special Revenue Funds
64 -67
Capital Project Fund
68
Nonmajor Proprietary Funds:
Combining Statement of Net Assets -
Nonmajor Proprietary Funds
69
Combining Statement of Revenues, Expenses and Changes
In Fund Net Assets - Nonmajor Proprietary Funds
70
Combining Statement of Cash Flows -
Nonmajor Proprietary Funds
71 -72
Fiduciary Funds:
Combining Statement of Fiduciary Net Assets
73
Combining Statement of Changes in Fiduciary Net Assets
74
Capital Assets Used in the Operation of Governmental Funds:
Schedule by Function and Activity
75
III. Statistical Section:
General Governmental Expenditures by Function
76 -77
General Governmental Revenues by Source
78 -79
Property Tax Levies and Collections
80
Assessed and Estimated Actual Value of Taxable Property, Net of Exemptions
81
Property Tax Rates, Direct and Overlapping Governments
82
Special Assessment Collections
83
Computation of Overlapping Debt
84
Demographic Statistics
85
Property Value, Construction, and Bank Deposits
86
Summary of Ten Largest Single Unit Water Users
87
Principal Taxpayers
88
Miscellaneous Statistical Data
89 -90
Water and Sewer Revenue Bond Coverage
91
IV. Other Reports:
Report on Compliance and on Internal Control over Financial
Reporting Based on an Audit of Financial Statements Performed 92 -93
in Accordance With Government Auditing Standards
Management Comments 94 -97
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THE CITY OF EDGE WATER
POST OFFICE BOX 100 - EDGEWATER, FLORIDA 32132 -0100
April 22, 2004
Honorable Mayor and Members
Of the City Council
City of Edgewater, Florida
The Comprehensive Annual Financial Report (CAFR) of the City of Edgewater, Florida, hereinafter
referred to as "the City ", for the fiscal year ended September 30, 2003, is submitted herewith
pursuant to Chapter 10.500 of the Rules of the Auditor General of the State of Florida.
Responsibility for both the accuracy of the data, and the completeness and fairness of the
presentation, including all disclosures, rests with the City. To the best of our knowledge and belief,
the enclosed data are accurate in all material respects and are reported in a manner designed to
present fairly the financial position and results of operations of the various funds and account groups
of the City. All disclosures necessary to enable the reader to gain an understanding of the City's
financial activities have been included.
The comprehensive annual financial report is presented in four sections:
• Introductory
• Financial
• Statistical
• Other Reports
The introductory section includes this transmittal letter, the City's organizational chart and a list of
principal officials. The financial section includes the general - purpose financial statements and the
combining and individual fund and account group financial statements and schedules, as well as the
independent auditor's report on the financial statements and schedules. The statistical section
includes selected financial and demographic information, generally presented on a multi -year basis.
The other reports section includes various reports and schedules.
The City has adopted implementation of Governmental Accounting Standards Board Statement No.
34 (GASB 34) , Basic Financial Statements and Management Discussion and Analysis for State and
Local Governments in reporting financial activity for the fiscal year ended September 30, 2003. The
new reporting model in accordance with GASB represents a substantial change in the way
governmental financial reporting has traditionally been prepared and presented. The most notable
change required by GASB 34 is: (1) the inclusion of Management's Discussion and Analysis, which
is an additional required element of the financial statements, (2) requirement to report infrastructure
assets, (3) requirement to report governmental funds on the economic resources measurement focus,
(4) requirement to report government -wide financial statements, and (5) a switch in focus towards
major funds and away from fund reporting. The objective of the GASB 34 in providing emphasis
on government -wide and major fund presentations is to enhance and demonstrate total fiscal and
operational accountability. Other objectives of the new reporting model places an emphasis on the
•" usefulness of external financial reports of state and local governments to the citizens, creditors,
investors, legislative and oversight bodies.
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Honorable Mayor and Members
of the City Council
Page 2 of 6
This report includes all funds and account groups of the City. The City provides a full range of
services. A summary of municipal services include police and fire protection; water, sewer and
reclaimed water services; sanitation services; stormwater management; the construction and
maintenance of local highways and streets; planning, building and development activities;
recreational activities; administrative services and cultural events. In addition to general government
activities, the City Council has financial - accountability and oversight of the Police Officers',
Firefighters', and the General Employees' Retirement Systems; therefore, these activities are
included in the reporting entity.
ECONOMIC CONDITION AND OUTLOOK
The City is located in southeast Volusia County, east of I -95 and south of New Smyrna Beach, to
Ariel Road, along the Indian River and two miles west of the Atlantic Ocean. The City is within the
economic zone of Central Florida, which roughly follows Interstate 4 from Tampa to Daytona Beach
through Orlando to the communities along the Atlantic coast in Volusia County.
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Edgewater has experienced a moderate and increasing rate of growth in the last five years.
Edgewater's population during that period increased from 18,077 to 20,088, an 11.12% increase for
the five -year. The City's single - family residential growth rate remains strong. Economic factors and
residential development interest within the City indicate these trends will continue to rise. Last year
the City issued 278 single - family residential home permits, a 23% increase over the previous year.
Coronado Paint, residential home construction, boat building (Boston Whaler, Edgewater Power
Boats, R. J. Dougherty Associates, Inc, Porta Products), ParkTowne Industrial Center and other light
manufacturing provide employment opportunities within the City. NASA and related supporting
enterprises at Cape Canaveral also provide further employment opportunities. Many of the City's
residents commute to Daytona Beach, Deland and Orlando for business employment as well.
The community currently has a 5.1% unemployment rate, below the state average of 5.3 %. During
the past five years, property taxable assessment values have increased 33.63 %. As the economy t
grows, we expect the recent growth trends experienced by the City to increase. The City continues ri
exploring several options to increase economic growth within the City and improve economic
development within southeast Volusia County. Toward this goal, the City's Economic Development
Board is continuing its emphasis on result- orientated initiatives. The City continues to develop many
partnerships between various economic development agencies and local businesses.
The City's economic growth initiative intensified with the purchase and development of the
ParkTowne Industrial Center. Growth within the Park remains strong with the addition of Chipmunk
Hardwood, Viking Industries and NIT holdings. The on going development of the property will spur
non - residential economic growth for the City and stimulate additional economic benefits for the Park
Avenue corridor. The Daytona Beach Community College, which has a campus adjacent to the
project site, may assist in attracting new jobs through the creation of a marine industry technology
center on a portion of the project site.
The economic condition and outlook for the City is strong. The major initiative towards economic "r
development, such as ParkTowne is shifting the tax burden from primarily residential to a
combination of commercial and residential. This approach has created an atmosphere within
Southeast Volusia County that is desirable to live and work.
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Honorable Mayor and Members
of the City Council
Page 3 of 6
MAJOR INITIATIVES
For the Year
The City is continuing the- development of the $1.6 million Hawks Park Recreational Facility. Phase
H of the project is nearly complete and includes four lighted ball fields, nature trails and an outdoor
amphitheater. Additional improvements will include a soccer complex and supporting facilities.
Construction of Hawks Park is supplemented by utilizing grants from FRDAP and Volusia County
t ECHO totaling $648,500.
ParkTowne Center continues to expand and the City is installing additional infrastructure to
accommodate more indw trial development. The Stormwater Management Master Plan for the City
of Edgewater is progressing and the City has secured a $105,000 cost sharing grant from the St.
Johns River Management District to aid in completing the current phase. The roadway widening and
utilities upgrade project of S.R. 442 has been completed allowing the growing traffic to flow
smoother through the area.. The City has installed a water distribution system for Hazelwood River
Road providing service toy 45 parcels.
For the Future
60 Leisure Services continues to plan for the redevelopment of Kennedy Park east of Riverside
Drive /City Hall complex. The plan will include an expanded landscaped site that will benefit boaters
and the sport fishing public of the area. The redevelopment is planned to begin by 2004/2005.
Additional improvement :3 scheduled throughout the City include replacement of the Rotary Park
playground, arboretum for plant enthusiast and beautification and landscape themes along S.R. 442
and U.S.1
The City is installing water and sewer infrastructure ($2.1 million) to facilitate development in the
western area of the City at the I- 95 /S.R. 442 interchange and along old Mission Road and Park
Avenue. Additionally, the City is renewing its Consumptive Use Permit to add four potable water
production wells from the St. Johns River Water Management District to ensure adequate water
supply through the 2020 planning horizon. The City has joined the Water Authority of Volusia to
develop an alternate sow-ce of potable water and conserve the existing aquifer source of potable
1 water.
The City is planning for a November 2004 referendum initiative for the purchase of a new City Hall
complex and Public Safety facility for the Police and Fire departments. Plans include the demolition
of the existing City Hall complex with site conversion and integration into the redevelopment of
Kennedy Park.
E The Police Department hi actively pursing grant funding to a full -time "Crime Prevention Officer"
position. Efforts are further being made to reduce crime through youth mentoring, placing an officer
in local schools full -time, expanding Crime Watch, and seeking greater Citizen participation in local
Law Enforcement issues. The Police Marine unit is expanding its activities in the areas of Public
safety,• and enforcement.
The Fire Department has entered into and Interlocal Closest -Unit Response Agreement with six (6)
other municipalities on the East Coast of Volusia County. The Agreement assures for the
coordination of the closest unit to respond no matter which City the emergency occurs in. It also
allows for the sharing of ether resources and the requirement for enhanced joint multi jurisdictional
and multi - company train ngs. The City has adopted a closest -unit response agreement with Volusia
County. The Department also plans to purchase a patient- transport capable apparatus. Once the
apparatus is obtained, the Department can work towards an agreement that will allow the City to
transport unstable patients if by chance the ambulance is unable to respond in an adequate time.
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Honorable Mayor and Members
of the City Council
Page 4 of 6
of
Department Focus
The Police Department has experienced another year of low crime rates. Detectives made a
significant number of arrests and clearances throughout the year resulting in higher incarceration
times for those responsible. The Department has expanded its traffic enforcement capabilities by
adding two (2) Motorcycle Officers and aggressively pursing local offenders. Neighborhood traffic
issues continue to be a prime concern though both accidents and traffic fatalities are down this year. W
The Fire/Rescue Department continues to provide superior Advanced Life Support (ALS) and
Emergency Medical Services (EMS) with 2,198 requests for assistance during 2003. The request go
for assistance has increased by 100 incidences or 4.76% since 2002 and is projected to increase as
the City continues to expand through development and annexations. The City maintained its average
response time to of 4 minutes or less to the majority of incidents. The majority of the incidents were go
emergency medical treatment request with many requiring the need for Advanced Life Support
Emergency Medical Treatment.
In addition to the emergency and non - emergency incidents, Fire/Rescue personnel continued to
provide various other services that include blood pressure screenings, CPR/First Aid training,
disaster preparedness, Community Emergency Response Team (CERT) training and immunizations
to City employees and the community. Additionally, the Department continues to assist with the
expansion of the only Regional Communication Center within Volusia County. The computer
program associated with the system gives the dispatchers and emergency responders critical
information for facilities within our area.
The Leisure Services Department was responsible for a variety of activities such as maintaining City
parks, roadway medians and organizing soccer and baseball activities for Edgewater's youth. These
activities allow many children the opportunity to participate in a variety of sports they may not
otherwise have an opportunity to do so. In addition, Leisure Services personnel assisted in the
completion of the new department offices and the first City Historical Museum located at the Hawks
Park Recreational Complex.
FINANCIAL INFORMATION
City management is responsible for establishing and maintaining an internal control structure
designed to ensure that the assets of the City are protected from loss, theft or misuse and to ensure
that adequate accounting data are compiled to allow for the preparation of financial statements in
conformity with generally accepted accounting principles.
The internal control structure is designed to provide reasonable assurance that these objectives are
met. The concept of reasonable assurance recognizes that: (1) the cost of control should not exceed
the benefits likely to be derived; (2) the valuation of costs and benefits requires estimates and
judgments by management. During previous years, the City implemented investment policies in
response to national events, improved internal control measures over cash and investments, and
increased legislative review.
Budgeting Controls
In addition to the internal financial function, the City maintains budgetary controls. The objective
of these budgetary controls is to ensure compliance with legal provisions embodied in the annual
appropriated budget approved by the City Council. The City Manager has the authority to exercise
legal budgetary control at the fund level and has the authority to adjust the various fund budgets.
The adopted annual operating budgets consist of. (1) the general fund; (2) the water and sewer fund;
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Honorable Mayor and Members
of the City Council
Page 5 of 6
(3) the refuse fund; and (4) stormwater management fund. The City maintains an encumbrance
accounting system as one technique of accomplishing budgetary control. Encumbrance amounts
lapse at year -end, however, encumbrances generally are either absorbed or appropriated as part of
the following year's budget.
�. Cash Management
Residual cash held during the year was invested primarily with the State Board of Administration.
Risk Management
The City of Edgewater contracts for all known risk elements through the purchase of insurance from
outside insurance companies. These policies carry low retentions with limits averaging $1,000,000
per risk insured. As a government entity, Florida's sovereign immunity statutes protect the City.
Under Florida Statutes, liability claims in excess of $100,000 per person or $200,000 per occurrence
require that a claim bill be passed by the Florida legislature before judgment can be collected.
The City contracts for its worker's compensation exposure through the Preferred Governmental
Insurance Trust. The loss experience has been excellent over the previous two years and so the City
elected to change to first dollar coverage beginning in October 1, 1997.
A medical health and dental plan, as well as an employee assistance program (EAP), are provided
to all full time employees. The medical plan provides for two options of coverage under either a
Preferred Physician Organization (PPO) or Health Maintenance Organization (HMO) option.
OTHER INFORMATION
Independent Audit
Florida Statute requires an annual audit by an independent certified public accountants. The
accounting firm of McDirmit Davis Puckett was selected by the City Council. The audit is designed
to meet the requirements set forth in State and Federal Statutes. The report of independent certified
public accountants on the general - purpose financial statements and combining and individual fund
rr statements and schedules is included in the financial section of this report.
Awards
The Government Finance Officers Association of the United States and Canada (GFOA) awarded
a Certificate of Achievement for Excellence in Financial Reporting to the City of Edgewater for its
comprehensive annual financial report (CAFR) for the fiscal year ended September 30, 2002. The
Certificate of Achievement is a prestigious national award - recognizing conformance with the highest
standards for preparation of a state and local government financial reports.
k' In order to be awarded a Certificate of Achievement, a government unit must publish an easily
readable and efficiently organized comprehensive annual financial report, whose contents conform
to program standards. The CAFR must satisfy both generally accepted accounting principles and
applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. The City of Edgewater has
received a Certificate of Achievement for the last eighteen consecutive years. We believe our current
report continues to conform to the Certificate of Achievement program requirements, and we are
submitting it to GFOA.
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Honorable Mayor and Members
of the City Council
Page 6 of 6
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Acknowledgments
The preparation of the comprehensive annual financial report on a timely basis was made possible
by the dedicated service of the entire staff of the Finance Department. Each member of the
department has our sincere appreciation for the contributions made in the preparation of this report.
In closing, we would also like to thank the Edgewater City Council for their direction, interest and
support in planning and conducting the financial operations of the City in a responsible and
progressive manner.
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Kenneth R. Hooper Jon C. Williams
City Manager Finance Director
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Certificate of
� Achievement
� for Excellence
in Financial
Reporting
Presented to
City of Edgewater,
Florida
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
September 30, 2002
A Certificate of Achievement for Excellence in Financial
I Reporting is presented by the Government Finance Officers
Association of the United States and Canada to
government units and public employee retirement
systems whose comprehensive annual financial
reports (CAFRs) achieve the highest
standards in government accounting
and financial reporting.
P NGE OFp „/
E STATE' ' L
�( uxlt[DSTA>FS
AND
D President
� CDRPDRATION `�
�NICA��
Executive Director
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CITY OF EDGEWATER, FLORIDA
LIST OF PRINCIPAL OFFICIALS
Year Ended September 30, 2003
MAYOR
Donald A. Schmidt
CITY COUNCIL
James P. Brown - District 1
Dennis A. Vincenzi - District 2
Harriet E. Rhodes - District 3
Judith R. Lichter - District 4
CITY MANAGER
Kenneth Hooper
CITY ATTORNEY
Foley and Lardner
CITY CLERK
Susan J. Wadsworth
FINANCE DIRECTOR
Jon C. Williams
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CITY OF EDGEWA TER
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FINANCIAL SECTION
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MCDIRMIT DAMS PUCKETT
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INDEPENDENT AUDITOR'S REPORT
Honorable Mayor and City Commission
City of Edgewater, Florida
Edgewater, Florida
We have audited the accompanying financial statements of the governmental activities, the
business -type activities, each major fund, and the aggregate remaining fund information of the
City of Edgewater, Florida, as of and for the year ended September 30, 2003, which collectively
comprise the City's basic financial statements as listed in the table of contents. These financial
statements are the responsibility of the City's management. Our responsibility is to express an
opinion on these financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in the United
States of America and the standards applicable to financial audits contained in Government
Auditing Standards, issued by the Comptroller General of the United States. Those standards
require that we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation. We believe that
our audit provides a reasonable basis for our opinions.
In our opinion the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities, the business -type activities, each major
fund, and the aggregate remaining fund information of the City of Edgewater, Florida, as of
September 30, 2003, and the respective changes in financial position and cash flows, where
applicable, thereof and the respective budgetary comparison for the general fund for the year then
ended in conformity with accounting principles generally accepted in the United States of America.
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MCDIRMIT DAVIS PUCKETT & COMPANY, L,L,C
CER'FI FI ED PUBLIC ACCOUNTANTS AND ADVISORS
605 E. ROBINSON STREET, SUITE 635 ° ORLANDO, FLORIDA 32801
TELEPHONE 407- 843 -5406 - FAX 407 -649 -9339 ° EMAIL: INFO@MDPCPA.CO!vi
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MFMHERS: PRIVATE. COMPANIES PRACTICE. SECTION • AMERICA\ INSTITUTF OF CERTIFIED PUHEIC ACCOUNTANT - S • FLORIDA I \STITU'rt OF CERTIFIFD PUI31_IC ACCOUNTANTS
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As described in Note 1, the City has implemented a new financial reporting model as required by
the provisions of GASB Statement No. 34, Basic Financial Statements - and Management's
Discussion and Analysis — for State and Local Governments, as of October 1, 2002. i
In accordance with Government Auditing Standards, we have also issued a report dated
January 27, 2004 on our consideration of the City of Edgewater, Florida's internal control over
financial reporting and our tests of its compliance with certain provisions of laws, regulations, 10 1
contracts and grants. That report is an integral part of an audit performed in accordance with
Government Auditing Standards and should be read in conjunction with this report in
considering the results of our audit. J
The Management's Discussion and Analysis on pages 3 through 13 is not a required part of the
basic financial statements but is supplemental information required by the Governmental
Auditing Standards Board. We have applied certain limited procedures, which consisted
principally of inquiries of management regarding the methods of measurement and presentation
of the supplemental information. However, we did not audit the information and express no
opinion on it.
Our audit was conducted for the purpose of forming an opinion on the financial statements that
collectively comprise the City of Edgewater's basic financial statements. The introductory section,
combining and individual nonmajor fund financial statements and schedules and statistical section
are presented for purposes of additional analysis and are not a required part of the basic financial
statements. The combining and individual nonmajor fund financial statements and schedules
have been subjected to the auditing procedures applied in the audit of the basic financial
statements and, in our opinion, are fairly stated in all material respects in relation to the basic
financial statements taken as a whole. The introductory section and the statistical section have
not been subjected to the auditing procedures applied in the audit of the basic financial
statements and, accordingly, we express no opinion on them. i
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McDIRMIT DAVIS PUCKETT & COMPANY, LLC
January 27, 2004
MANAGEMENT'S DISCUSSION AND ANALYSIS
As management of the City of Edgewater, Florida we offer readers of the City of Edgewater's
financial statements this narrative overview and analysis of the financial activities of the City of
Edgewater for the fiscal year ended September 30, 2003. We encourage readers to consider the
information presented here in conjunction with additional information that we have furnished in our
letter of transmittal.
Financial Highlights
• The assets of the City of Edgewater exceeded its liabilities at the close of the most
recent fiscal year by $44,992,450 (net assets). Of this amount, $15,858,660
(unrestricted net assets) may be used to meet the government's ongoing obligations to
citizens and creditors.
• The government's total net assets decreased by $760,574.
• As of the close of the current fiscal year, the City of Edgewater's governmental funds
reported combined ending fund balances of $2;952,447, a decrease of $217,697 in
comparison with the prior year. Most of this total amount is available for spending at
the government's discretion (unreserved fund balance).
• At the end of the current fiscal year, unreserved fund balance for the general fund was
$767,790, or 7.9% of total general fund expenditures.
Overview of the Financial Statements
This discussion and analysis are intended to serve as an introduction to the City of Edgewater's
(the City) basic financial statements. The City's basic financial statements comprise three
components: 1) government -wide financial statements, 2) fund financial statements, and 3) notes
to the financial statements. This report also contains other supplementary information in addition to
the basic financial statements themselves.
Government -Wide Financial Statements
The government -wide financial statements are designed to provide readers with a broad overview
of the City of Edgewater's finances, in a manner similar to a private- sector business.
The statement of net assets presents information on all of the City's assets and liabilities, with the
difference between the two reported as net assets. Over time, increases or decreases in net
assets may serve as a useful indicator of whether the financial position of the City is improving or
deteriorating.
The statement of activities presents information showing how the government's net assets
changed during the most recent fiscal year. All changes in net assets are reported as soon as the
underlying event giving rise to the change occurs, regardless of the timing of related cash flows.
Thus, revenues and expenses are reported in this statement for some items that will only result in
cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation leave).
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MANAGEMENT'S DISCUSSION AND ANALYSIS - CONTINUED
Both of the government -wide financial statements distinguish functions of the City of Edgewater
that are principally supported by taxes and intergovernmental revenues (governmental activities)
from other functions that are intended to recover all or a significant portion of their costs through
user fees and charges (business -type activities). The governmental activities of the City of
Edgewater include general government, public safety, transportation /public works and leisure
services. The business -type activities of the City of Edgewater include water and sewer, refuse
collection, stormwater management, development fees and renewal and replacement.
The government -wide financial statements include only the City of Edgewater itself (known as the
primary government). The City of Edgewater has no component units.
The government -wide financial statements can be found on pages 14 - 15 of this report.
Fund Financial Statements
A fund is a grouping of related accounts that is used to maintain control over resources that have
been segregated for specific activities or objectives. The City of Edgewater, like other state and
local governments, uses fund accounting to ensure and demonstrate compliance with finance -
related legal requirements. All of the funds of the City of Edgewater can be divided into three
categories: governmental funds, proprietary funds and fiduciary funds.
Governmental Funds - Governmental funds are used to account for essentially the same
functions reported as governmental activities in the government -wide financial statements.
However, unlike the government -wide financial statements, governmental fund financial statements
focus on near -term inflows and outflows of spendable resources, as well as on balances of
spendable resources available at the end of the fiscal year. Such information may be useful in
evaluating a government's near -term financing requirements.
Because the focus of governmental funds is narrower than that of the government -wide financial
statements, it is useful to compare the information presented for governmental funds with similar
information presented for governmental activities in the government -wide financial statements. By
doing so, readers may better understand the long -term impact of the government's near -term
financing decisions. Both the governmental fund balance sheet and the governmental fund
statement of revenues, expenditures, and changes in fund balances provide a reconciliation to
facilitate this comparison between governmental funds and governmental activities.
The City of Edgewater maintains seven individual governmental funds. Information is presented '
separately in the governmental fund balance sheet and in the governmental fund statement of
revenues, expenditures, and changes in fund balances for the general fund, and the debt service
fund, both of which are considered to be major funds. Data from the other five governmental funds .�
are combined into a single, aggregated presentation. Individual fund data for each of these
nonmajor governmental funds is provided in the form of combining statements elsewhere in this
report.
The City of Edgewater adopts an annual appropriated budget for all of its governmental funds.
Budgetary comparison statements have been provided for the General Fund to demonstrate
compliance with this budget at page 19. Budgetary comparison schedules have been provided for
the Debt Service Fund and the nonmajor funds at pages 59 and 64 - 68.
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M MANAGEMENT'S DISCUSSION AND ANALYSIS - CONTINUED
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The basic governmental fund financial statements can be found on pages 16 -19 of this report.
Proprietary funds. The City of Edgewater maintains one type of proprietary fund. Enterprise
funds are used to report the same functions presented as business -type activities in the
government -wide financial statements. The City of Edgewater uses enterprise funds to account for
water and sewer, refuse collection, stormwater management, development fees and renewal and
replacement.
Proprietary funds provide the same type of information as the government -wide financial
r " statements, only in more detail. The proprietary fund financial statements provide separate
information for water and sewer, refuse collection and stormwater management, which are all
considered to be major funds. Data for the other 2 proprietary funds are combined into a single
aggregated presentation. Individual fund data for each of these nonmajor proprietary funds is
provided in the form of combining statements elsewhere in this report.
The basic proprietary fund financial statements can be found on pages 20 - 24 of this report.
Fiduciary funds. Fiduciary funds are used to account for resources held for the benefit of parties
outside the government. Fiduciary funds are not reflected in the government -wide financial
statements because the resources of those funds are not available to support the City of
Edgewater's own programs. The accounting used for fiduciary funds is much like that used for the
proprietary funds.
The basic fiduciary fund financial statements can be found on pages 25 - 26 of this report.
Notes to the financial statements. The notes provide additional information that is essential to
a full understanding of the data provided in the government -wide and fund financial statements.
The notes to financial statements can be found on pages 27 - 58 of this report.
Other information. The combining statements referred to earlier in connection with nonmajor
governmental and proprietary funds are presented immediately following the Notes to Financial
Statements. Combining and individual fund statements and schedules can be found on pages 60 -
74 of this report.
Government -Wide Financial Analysis
As noted earlier, net assets may serve over time as a useful indicator of a government's financial
position. In the case of the City of Edgewater, assets exceeded liabilities by $44,992,450 at the
close of the most recent fiscal year. The following table reflects the condensed statement of net
assets for the current year. Comparison to the prior year is not presented, as 2003 is the
implementation year for GASB Statement #34. For more detail see the Statement of Net Assets
on page 14.
1
MANAGEMENT'S DISCUSSION AND ANALYSIS - CONTINUED
City of Edgewater
Stat of Net Assets
Forty -three percent (43 %) of the City's net assets reflects its investment in capital assets (e.g.,
land, buildings, improvements, infrastructure and equipment) less any related debt used to acquire
those assets that is still outstanding. The City uses these capital assets to provide services to
citizens; consequently, these assets are not available for future spending. Although the City of
Edgewater's investment in its capital assets is reported net of related debt, it should be noted that
the resources needed to repay this debt must be provided from other sources, since the capital
assets themselves cannot be used to liquidate these liabilities.
An additional portion of the City of Edgewater's net assets (22 %) represents resources that are
subject to external restrictions on how they may be used. The remaining balance of unrestricted
net assets ($15,858,660) may be used to meet the government's ongoing obligations to citizens
and creditors.
At the end of the current fiscal year, the City of Edgewater is able to report positive balances in all
categories of net assets.
The City's net assets decreased by $760,574 during the current fiscal year. This decrease was
primarily due to increase in expenses, as detailed below. The following table reflects the
condensed Statement of Activities for the current year. Comparison to the prior year is not
presented, as 2003 is the implementation year for GASB Statement #34. For more detail see the
Statement of Activities on page 15.
0
Governmental
Business Type
Activities
Activities
Total
2003
2003
2003
Current and other assets
$ 7,291,026
$21,917,794
$29,208,820
Capital assets
18,393,432
48,733,463
67,126,895
Total assets
25,684,458
70,651,257
96,335,715
Current liabilities
394,257
276,183
670,440
Long -term liabilities outstanding
13,239,919
35,893,957
49,133,876
Other liabilities
560,386
978,563
1,538,949
Total liabilities
14,194,562
37,148,703
51,343,265
Net assets:
Invested in capital assets, net of
related debt
6,010,568
13,185,840
19,196,408
Restricted
5,309,445
4,627,937
9,937,382
Unrestricted
169,883
15,688,777
15,858,660
Total net assets
$11,489,896
$33,5Q2,554
$44,992,450
Forty -three percent (43 %) of the City's net assets reflects its investment in capital assets (e.g.,
land, buildings, improvements, infrastructure and equipment) less any related debt used to acquire
those assets that is still outstanding. The City uses these capital assets to provide services to
citizens; consequently, these assets are not available for future spending. Although the City of
Edgewater's investment in its capital assets is reported net of related debt, it should be noted that
the resources needed to repay this debt must be provided from other sources, since the capital
assets themselves cannot be used to liquidate these liabilities.
An additional portion of the City of Edgewater's net assets (22 %) represents resources that are
subject to external restrictions on how they may be used. The remaining balance of unrestricted
net assets ($15,858,660) may be used to meet the government's ongoing obligations to citizens
and creditors.
At the end of the current fiscal year, the City of Edgewater is able to report positive balances in all
categories of net assets.
The City's net assets decreased by $760,574 during the current fiscal year. This decrease was
primarily due to increase in expenses, as detailed below. The following table reflects the
condensed Statement of Activities for the current year. Comparison to the prior year is not
presented, as 2003 is the implementation year for GASB Statement #34. For more detail see the
Statement of Activities on page 15.
0
MANAGEMENT'S DISCUSSION AND ANALYSIS - CONTINUED
City of Edgewater
Changes in Net Assets
Governmental Business Type
Activities Activities Total
2003 2003 2003
Revenues:
Program revenues -
Charges for services
Operating grants and contributions
Capital grants and contributions
General revenues -
Property taxes
Franchise and utility taxes
Intergovernmental
Investment income and
Miscellaneous
Total revenues
Expenses:
General government
Public safety
Transportation /public works
Leisure services
Interest on long -term debt
Water and sewer
Refuse collection
Stormwater management
Development fees
Renewal and replacement
Total expenses
Increase (Decrease) in Net Assets
Before Transfers
Transfers
Increase (Decrease) in Net Assets
Net Assets - Beginning
Net Assets - Ending
$ 1,259,220
$ 7,370,234
$ 8,629,454
401,116
-
401,116
192,861
3,047,057
3,239,918
3,403,304
-
3,403,304
2,555,819
-
2,555,819
1,627,439
-
1,627,439
298,967
661,124
960,091
9,738,726
11,078,415
20,817,141
2,478,672
-
2,478,672
5,670,853
-
5,670,853
2,765,177
-
2,765,177
1,573,582
-
1,573,582
356,159
-
356,159
-
6,253,322
6,253,322
-
1,565,664
1,565,664
-
882,456
8,824,456
-
31,180
31,180
-
650
650
12,844,443
8,733,272
21,577,715
(3,105,717)
2,345,143
(760,574)
751,758
(751,758
-
(2,353,959)
1,593,385
(760,574)
13,843,855
31,909,169
45,753,024
11,489,896
533,502,554
$ 44 992,450
7
MANAGEMENT'S DISCUSSION AND ANALYSIS - CONTINUED �
Governmental activities - Governmental activities decreased the City of Edgewater's net assets
by $3,105,717. Key elements of this decrease are as follows:
• Property taxes increased by almost $700,000 (25 %) during the year.
W�
• Expenses for transportation /public works increased primarily because the City transferred
water and sewer and stormwater improvements totaling $1,878,287 from the FIND project
which were originally included in construction in progress for governmental activities.
• Because of implementation of GASB 34 in 2003, expenses include $1,025,575 of QW
deprecation allocated to the proper function.
Business -type activities - Business -type activities increased the City of Edgewater's net assets '
by $2,345,143. Key elements of this increase are as follows:
• Charges for services for business -type activities increased by 10 %, primarily due to
increase in demand.
• As mentioned above, water and .sewer and stormwater improvements totaling $1,878,287 w
were contributed to business -type activities from governmental activities for FIND project.
• The renewal and replacement fund received a $202,000 grant from the St. John's River
Water Management District for construction of a ground storage tank for excess reclaimed
water.
I �
u
I I
51
rr MANAGEMENT'S DISCUSSION AND ANALYSIS - CONTINUED
Expenses and Program Revenues - Governmental Activities
$5,670,853
Revenues by Source - Governmental Activities
r
I n Intergovernment ■ Program revenues ❑ Investment income & miscellaneous ❑ Other taxes ® Property taxes
Intergovernment
a
Property taxi
35%
Othertaxes
26%
ft 9
Program revenues
19%
ment income &
scellaneous
3%
General government Public safety Transportation/Public works Leisure services Interest on long -term debt
® Expenses ■ Program revenues
MANAGEMENT'S DISCUSSION AND ANALYSIS — CONTINUED
Expenses and Program Revenues - Business -Type Activities
Revenues by Source - Business -Type Activities
M Investment income & miscellaneous 17 Charges for Services 17 Capital Grants and Contributions
Capital Grants and Contrib
28%
x Services
i%
10
Water and sewer Refuse collection Stonnwater Management Development Fees Renewal and Replace
I N Expenses ■Program Revenue
Investment income &
miscellaneous
6%
+■ MANAGEMENT'S DISCUSSION AND ANALYSIS — CONTINUED
M
Financial Analysis of the Government's Funds
to As noted earlier, the City of Edgewater used fund accounting to ensure and demonstrate
compliance with finance - related requirements.
Governmental Funds - The focus of the City's governmental funds is to provide information on
near -term inflows, outflows, and balances of spendable resources. Such information is useful in
assessing the City of Edgewater's financing requirements. In particular, unreserved fund
balance may serve as a useful measure of a government's net resources available for spending
at the end of the fiscal year.
As of the end of the current fiscal year, the City of Edgewater's governmental funds reported
it combined ending fund balances of $2,952,447, a decrease of $217,697 in comparison with the
prior year. Approximately 80% of this amount ($2,379,116) constitutes unreserved fund
balance, which is available for spending at the City's discretion. The remainder of fund balance
is reserved to indicate that it is not available for new spending because it has already been
committed to (1) pay debt service ($554,472) or (2) for other purposes ($15,859).
The general fund is the chief operating fund of the City of Edgewater. At the end of the current
fiscal year, unreserved fund balance of the general fund was $767,790, while total fund balance
was $783,649. As a measure of the general fund's liquidity, it may useful to compare both
unreserved fund balance and total fund balance to total fund expenditures. Unreserved fund
balance represents 7.9 percent of total general fund expenditures, while total fund balance
represents 8.1 percent of that same amount.
+� The fund balance of the general fund increased by $35,620 during the current fiscal year.
Proprietary Funds - The City Edgewater's proprietary funds provide the same type of
it information found in the government -wide financial statements, but in more detail.
Unrestricted net assets of the Proprietary Funds at the year end amounted to $15,688,777. The
total growth in net assets for these funds was $1,593,385. Other factors concerning the
finances of these two funds have already been addressed in the discussion of the City of
Edgewater's business -type activities.
General Fund Budgetary Highlights
There were no differences between the original budget and the final amended budget. During
the year, actual revenues were $588,316 less than budgeted revenue and actual expenditures
were $450,250 less than budgeted expenditures. However, actual expenditures did exceed
budgeted expenditures in the following functions: general government and public safety.
Because revenues were less than anticipated, the City was only able to add $35,620 to fund
balance rather than $410,298 budgeted.
to
ft
11
MANAGEMENT'S DISCUSSION AND ANALYSIS — CONTINUED •w
Capital Asset and Debt Administration
am
Capita! Assets - The City of Edgewater's investment in capital assets for its governmental am
activities as of September 30, 2003, amounts to $67,126,895 net of accumulated depreciation).
This investment in capital assets includes land, buildings, improvements, machinery and
equipment and infrastructure. The total decrease in the City's investment in capital assets for
the current fiscal year was 1%. Major capital asset events during the current fiscal year
included the following:
• Capital improvements to roads drainage and water and sewer lines were completed for
FIND Phase I. The improvements were recorded as either governmental activities or
business -type activities capital assets, except for land held for resale totaling $618,580
was recorded in the general fund.
• The reclaimed water facility costing $2,309,129 was completed.
o
• The City purchased Terra Mar Utilities consisting of water supply, treatment and
distribution system and a sewage collection, treatment and disposal system. Total cost
amounted to $750,000. VOW
City of Edgewater
Capital Assets
(Net of Depreciation)
Additional information on the City of Edgewater's capital assets can be found in Note 6 on
pages 41 - 42 of this report.
OW,
12
Governmental
Business Type
Activities
Activities
Total
2003
2003
2003
Land
$ 3,779,436
$ 676,827
$ 4,456,263
Buildings
2,894,093
15,068,149
17,962,242
Improvements
9,375,323
30,806,397
40,181,720
Machinery and equipment
851,622
1,094,150
1,945,772
Infrastructure
609,823
-
609,823
Construction in progress
883,135
1,087,940
1,971,075
Total
818,393,432
$48,733,463
$67,126,895
Additional information on the City of Edgewater's capital assets can be found in Note 6 on
pages 41 - 42 of this report.
OW,
12
MANAGEMENT'S DISCUSSION AND ANALYSIS - CONTINUED
Long -Term Debt - At the end of the current fiscal year, the City of Edgewater had total debt
outstanding of $48,050,195. This debt includes bonds payable, notes payable and the state
revolving loan. Additional information on long -term debt can be found in Note 7 on pages 43 -
50 of this report.
City of Edgewater
Long -Term Debt
Governmental Business Type
Activities Activities Total
2003 2003 2003
Bonds payable $ - $11,940,000 $11,940,000
Notes payable 12,382,864 7,922,467 20,305,331
State revolving loan - 15,804,864 15,804,864
$12,382,864 $35,667,331 $48,050,195
The City of Edgewater's total debt decreased by $2,258,069 (4.5 percent) during the current
fiscal year. This is net of the following increases:
• City signed a $600,000 notes payable to Terra Mar Utilities for acquisition discussed
above.
• Additions to the FIND note payable amounted to $104,630.
Next Year's Budget and Rates
During the current fiscal year, the unreserved fund balance in the General Fund increased to
$767,790. The City has not appropriated any of this amount for spending in the 2004 fiscal year
budget since the plan is to increase the unreserved fund balance so that it at least 10 -20% of
general fund operating expenditures.
Requests for Information
This financial report is designed to provide a general overview of the City of Edgewater's
finances for all those with an interest in the government's finances. Questions concerning any
of the information should be addressed to the office of the Finance Director, City of Edgewater,
P.O. Box 100, Edgewater, Florida 32132 -0100.
+w
1 13
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BASIC FINANCIAL STATEMENTS
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1
CITY OF EDGEWATER, FLORIDA
STATEMENT OF NET ASSETS
September 30, 2003
Assets:
Cash and cash equivalents
Receivables, net
Inventories and prepaid costs
Due from other governments
Internal balances
Restricted assets:
Cash and cash equivalents
Investments
Special assessments receivable
Bond issuance costs
Land held for resale
Investment in joint venture
Capital assets not being depreciated
Capital assets being depreciated, net of
accumulated depreciation
Total Assets
Liabilities:
Accounts payable and other current liabilities
Due to other governments
Unearned revenue
Liabilities payable from restricted assets
Noncurrent liabilities:
Due within one year
Due in more than one year
Total Liabilities
Primary Government
Governmental Business -type
Activities Activites Total
$ 2,998,133
$ 4,608,020
$ 7,606,153
16,782
891,394
908,176
15,859
58,168
74,027
76,455
-
76,455
275,167
(275,167)
-
-
4,566,380
4,566,380
-
1,126,107
1,126,107
3,140,647
10,636,412
13,777,059
-
306,480
306,480
524,694
-
524,694
243,289
-
243,289
4,662,571
1,764,767
6,427,338
13,730,861
46,968,696
60,699,557'
14
25,684,458
70,651,257
96,335,715
380,302
276,183
656,485
13,955
-
13,955
560,386
-
560,386
-
2,614,202
2,614,202
1,509,154
917,557
2,426,711
11,730,765
33,340,761
45,071,526
14,194,562
37,148,703
51,343,265
Net Assets:
Invested in capital assets, net of related debt
6,010,568
13,185,840
19,196,408
Restricted for:
Capital projects
1,257,012
-
1,257,012
Debt service
3,698,119
1,126,107
4,824,226
Other purposes
354,314
3,501,830
3,856,144
Unrestricted
169,883
15,688,777
15,858,660
f Total
Net Assets
$ 11,489,896
$ 33,502,554
$ 44,992,450
The accompanying Notes to Financial Statements are an
integral part of these
statements.
14
1
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0 CITY OF EDGEWATER, FLORIDA
BALANCE SHEET
• GOVERNMENTAL FUNDS
September 30, 2003
i� Assets:
Cash and cash equivalents
Receivables, net
Inventories, at cost
Due from other governments
Due from other funds
Prepaid costs
Special assessments receivable
Land held for resale
Total Assets
E
t
Liabilities and Fund Balances:
Accounts payable
Accrued liabilities
Retainage payable
Due to other governments
Deferred revenue
Unearned revenue
Deposits
Total Liabilities
Fund balances:
Reserved:
Inventories and prepaid costs
Debt service
Unreserved, reported in:
General fund
Special revenue funds
Capital projects funds
Total fund balances
Total Liabilities and Fund
Balances
$ 1,710,027 $ 3,698,119 $ 1,639,591
Amounts reported for governmental activities in the statement of net
assets are different because:
Capital assets used in governmental activities are not financial resources
and, therefore are not reported in the funds 18,393,432
Investment in joint venture is not a financial asset and therefore is not
reported in the funds 243,289
Other long -term assets are not available to pay for current period
expenditures and, therefore, are deferred in the funds 3,140,647
Long -term liabilities are not due and payable in the current
period and therefore are not reported in the funds (13,239,919)
Net assets of governmental activities $ 11,489,896
r
r�
The accompanying Notes to Financial Statements are an integral part of these statements.
16
Other
Total
Debt
Governmental
Governmental
General
Service
Funds
Funds
$ 801,070
$ 557,472
$ 1,639,591
$ 2,998,133
16,782
-
-
16,782
12,831
-
-
12,831
76,455
-
-
76,455
275,167
-
-
275,167
3,028
-
-
3,028
3,140,647
-
3,140,647
524,694
-
-
524,694
$ 1,710,027
$ 3,698,119
$ 1,639,591
$ 7,047,737
$ 288,564
$ -
28,265
$ 316,829
55,811
-
-
55,811
4,932
-
-
4,932
13,955
-
-
13,955
-
3,140,647
-
3,140,647
560,386
-
-
560,386
2,730
-
-
2,730
926,378
3,140,647
28,265
4,095,290
15,859
-
-
15,859
-
557,472
-
557,472
767,790
-
-
767,790
-
-
354,314
354,314
-
-
1,257,012
1,257,012
783,649
557,472
1,611,326
2,952,447
$ 1,710,027 $ 3,698,119 $ 1,639,591
Amounts reported for governmental activities in the statement of net
assets are different because:
Capital assets used in governmental activities are not financial resources
and, therefore are not reported in the funds 18,393,432
Investment in joint venture is not a financial asset and therefore is not
reported in the funds 243,289
Other long -term assets are not available to pay for current period
expenditures and, therefore, are deferred in the funds 3,140,647
Long -term liabilities are not due and payable in the current
period and therefore are not reported in the funds (13,239,919)
Net assets of governmental activities $ 11,489,896
r
r�
The accompanying Notes to Financial Statements are an integral part of these statements.
16
CITY OF EDGEWATER, FLORIDA
1
STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES
'
IN FUND BALANCES - GOVERNMENTAL FUNDS
For The
Year Ended
September 30,
2003
Other
Total
Debt Governmental
Governmental
General
Service
Funds
Funds
,)
Revenues:
�
Taxes
$ 5,959,123
$ - $
-
$ 5,959,123
w1
Licenses and permits
445,741
-
-
445,741
Intergovernmental revenues
2,221,416
-
-
2,221,416
ry
Charges for services
112,985
-
-
112,985
Fines and forfeitures
184,080
-
9,882
193,962
Impact fees /special assessments
20,701
399,888
223,831
644,420
Investment income
3,616
224,509
26,128
254,253
Miscellaneous
44,714
-
-
44,714
Total revenues
8
624,397
259,841
9,876,614
Expenditures:
Current:
General government
2,033,442
-
-
2,033,442
Public safety
5,218,439
-
90,498
5,308,937
Transportation /public works
359,916
-
-
359,916
Leisure services
1,532,233
-
77,738
1,609,971
Debt service:
Principal retirement
528,471
606,420
-
1,134,891
Interest and fiscal charges
49,214
306,945
-
356,159
Capital outlay:
-
General government
-
-
409,383
409,383
Total expenditures
9,721,715
913,365
577,619
11,212,699
Excess (Deficiency) of
Revenues Over Expenditures
(729,339)
(288,968) (317,778)
(1,336,085)
f
Other Financing Sources (Uses)
Transfers in
755,000
353,429
-
1,108,429
Transfers out
(356,671)
-
-
(356,671)
Loan proceeds
104,630
-
-
104,630
Sale of land held for resale
262,000
-
-
262,000
Net other financing sources
(uses)
764,959
353,429
-
1,118,388
Net Change in Fund Balances
35,620
64,461
(317,778)
(217,697)
Fund Balances - Beginning
748,029
493,011
1,929,104
3,170,144
Fund Balances - Ending
$ 783,649
$ 557,472 $
1,611,326
$ 2,952,447
The accompanying Notes to Financial Statements are an integral part of these statements.
17
i " CITY OF EDGEWATER, FLORIDA
RECONCILIATION OF THE STATEMENT OF REVENUES,
EXPENDITURES, AND CHANGES IN FUND BALANCES OF
GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES
For The Year Ended Sept ember 30, 2003
Amounts reported for the governmental activities in the statement of
activities (page 15) are different because:
Net change in fund balances - total governmental funds (page 17) $ (217,697)
Governmental funds report capital outlays as expenditures. However, in
the statement of activities the cost of those assets is allocated over
their estimated useful lives and reported as depreciation expense.
This is the amount by which capital outlays exceeded depreciation
in the current period. (769,982)
1
The accompanying Notes to Financial Statements are an integral part of these statements
1 18
10
The net effect of various transactions involving capital assets(i.e. sales,
trade -ins and transfers to proprietary funds) is to decrease net assets.
(1,886,040)
The issuance of long -term debt provides current financial resources to
governmental funds, while the repayment of the principal of long -term
debt consumes the current financial resources of governmental funds.
Neither transaction, however, has any effect on net assets. This
amount is the net effect of these differences in the treatment of
long -term debt and related items.
1,030,261
Special assessment revenue reported in the funds in the current
year must be eliminated from the statement of activities since
revenue was recognized in a prior year.
(399,888)
'
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.
(110,613)
Change in net assets of governmental activities (page 15)
$ (2,353,959)
1
The accompanying Notes to Financial Statements are an integral part of these statements
1 18
10
1
1
t
11
1
This page intentionally left blank.
so CITY OF EDGEWATER, FLORIDA
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCE - BUDGET AND ACTUAL
For The Year Ended September 30, 2003
Budgeted Amounts
Original Final
Actual
Amounts
Variance With
Final Budget
Positive
(Negative)
Revenues:
Taxes
Licenses and permits
Intergovernmental revenues
Charges for services
i� Fines and forfeitures
Impact fees /special assessments
Investment income
Miscellaneous
Total revenues
$ 5,773,579
$ 5,773,579
$ 5,959,123
$ 185,544
426,600
426,600
445,741
19,141
2,971,063
2,971,063
2,221,416
(749,647)
135,000
135,000
112,985
(22,015)
96,300
96,300
184,080
87,780
12,000
12,000
20,701
8,701
85,600
85,600
3,616
(81,984)
80,550
80,550
44,714
(35,836)
9,580,692
9,580,692
8,992,376
(588,316)
ft Expenditures:
is
IN The accompanying Notes to Financial Statements are an integral part of these statements.
19
so
Current:
General government
2,023,853
2,023,853
2,033,442
(9,589)
Public safety
5,166,639
5,166,639
5,218,439
(51,800)
Transportation /public works
401,377
401,377
359,916
41,461
Leisure services
1,753,375
1,753,375
1,532,233
221,142
Debt service:
Principal retirement
766,325
766,325
528,471
237,854
Interest and fiscal charges
60,396
60,396
49,214
11,182
Total expenditures
10,171,965
10,171,965
9,721,715
450,250
Excess (Deficiency) of Revenues
Over Expenditures
(591,273)
(591,273)
(729,339)
(138,066)
Other Financing Sources (Uses)
Transfers in
755,000
755,000
755,000
-
Transfers out
(353,429)
(353,429)
(356,671)
(3,242)
Loan proceeds
-
-
104,630
104,630
Sale of land held for resale
600,000
600,000
262,000
(338,000)
Net other financing sources (uses)
1,001,571
1,001,571
764,959
(236,612)
Net Change in Fund Balance
410,298
410,298
35,620
(374,678)
Fund Balances - Beginning
748,029
748,029
748,029
to
Fund Balances - Ending
$ 1,158,327
$ 1,158,327
$ 783,649 $
(374,678)
is
IN The accompanying Notes to Financial Statements are an integral part of these statements.
19
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1
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LJ
CITY OF EDGEWATER, FLORIDA
STATEMENT OF FIDUCIARY NET ASSETS
FIDUCIARY FUNDS
September 30, 2003
Liabilities:
Accounts payable 1,034
Net Assets:
Held in trust for pension benefits $ 16,361,113
The accompanying Notes to Financial Statements are an integral part of these statements.
25
Total Employee
Pension Funds
Assets:
Cash and cash equivalents
$ 212,368
Investments, at fair value:
Debt mutual funds
7,895,108
Equity mutual funds
6,966,746
Other mutual funds
1,287,925
Total investments
16,149,779
Total assets
16,362,147
Liabilities:
Accounts payable 1,034
Net Assets:
Held in trust for pension benefits $ 16,361,113
The accompanying Notes to Financial Statements are an integral part of these statements.
25
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R
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CITY OF EDGEWATER, FLORIDA
STATEMENT OF CHANGES IN FIDUCIARY NET ASSETS
FIDUCIARY FUNDS
For The Year Ended September 30, 2003
Additions:
Contributions:
Employer
Plan members
State
Total contributions
Investment income:
Net increase in fair value of investments
Less investment expense
Net investment income
Total additions
Deductions:
Benefits /distributions
Administrative expenses
Total deductions
Change in Net Assets
Net Assets - Beginning
Net Assets - End
Total Employee
Pension Funds
$ 993,172
207,554
157,122
1,357,848
1,629,435
(34,992)
1,594,443
2,952,291
325,975
44,193
370,168
2,582,123
13,778,990
$ 16,361,113
The accompanying Notes to Financial Statements are an integral part of these statements.
26
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NOTES TO FINANCIAL STATEMENTS
1
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M
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CITY OF EDGEWATER, FLORIDA
NOTES TO FINANCIAL STATEMENTS
September 30, 2003
Note 1 - Summary of Significant Accounting Policies:
A. Reporting Entity
The City of Edgewater, Florida ( "the City ") is a political subdivision of the state of Florida
located in Volusia County. The Town of Edgewater was originally incorporated under the
general law on October 20, 1924, "Municipal Charters" Volume 4, page 117. The town
became the City of Edgewater when its initial charter was adopted by Chapter 275.32 Special
Acts of 1951. The legislative branch of the City is composed of a Mayor and four (4) member
elected Council. The City Council is responsible for the establishment and adoption of policy.
The execution of such policy is the responsibility of the Council appointed City Manager.
In evaluating how to define the government, for financial reporting purposes, the City has
considered all potential component units. The definition of the reporting entity is based
primarily on the notion of financial accountability. A primary government is financially
accountable for the organizations that make up its legal entity. It is also financially
accountable for legally separate organizations if its officials appoint a voting majority of an
organization's governing body, and either it is able to impose its will on that organization or
there is a potential for the organization to provide specific financial benefits to, or to impose
specific financial burdens on, the primary government. A primary government may also be
financially accountable for governmental organizations that are fiscally dependent on it.
A primary government has the ability to impose its will on an organization if it can significantly
influence the programs, projects or activities of, or the level of services performed or provided
by, the organization. A financial benefit or burden relationship exists if the primary
government (a) is entitled to the organizations' resources; (b) is legally obligated or has
otherwise assumed the obligation to finance the deficits of, or provide financial support to, the
organization; or (c) is obligated in some manner for the debt of the organization. In applying
the above criteria, management has determined that there are no components units to be
included within the reporting entity.
27
CITY OF EDGEWATER, FLORIDA
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
Note 1 - Summary of Significant Accounting Policies (Continued):
B. Government -Wide and Fund Financial Statements
ad
The City was required to implement Government Accounting Standards Board (GASB)
Statement 34 that requires a change in the reporting format. The government -wide
financial statements along with the notes to the financial statements comprise the basic
financial statements. This approach differs from the pervious reporting model in that the
fiduciary funds are not included. As a part of a phased implementation of this Statement,
there is a new reporting requirement regarding the government's infrastructure (roads,
bridges, traffic signals, etc.). This requirement permits an optional four -year further delay
for implementation to the fiscal year ending 2007. The City will implement the
infrastructure - related portion by or before the required date.
The government -wide financial statements (i.e., the statement of net assets and the
statement of changes in net assets) report information on all of the nonfiduciary activities of
the City. For the most part, the effect of interfund activity has been removed from these
statements. Governmental activities, which normally are supported by taxes and
intergovernmental revenues, are reported separately from business -type activities, which
rely to a significant extent on fees and charges for support.
The statement of activities demonstrates the degree to which the direct expenses of 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 operational or capital requirements of a
particular function or segment. Taxes and other items not properly included among
program revenues are reported instead as general revenues.
Separate financial statements are provided for governmental funds, proprietary funds, and
fiduciary funds, even though the latter are excluded from the government -wide financial
statements. Major individual governmental funds and major individual enterprise funds are
reported as separate columns in the fund financial statements.
C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation
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 j
items are recognized as revenue as soon as all eligibility requirements imposed by the •i
provider have been met.
28 J
W CITY OF EDGEWATER, FLORIDA
NOTES TO FINANCIAL STATEMENTS - Continued
W
1
September 30, 2003
Note 1 - Summary of Significant Accounting Policies (Continued):
C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation
(Continued)
Governmental fund financial statements are reported using the current financial resources
measurement focus and the modified accrual basis of accounting. Revenues are
recognized as soon as they are both measurable and available. Revenues are considered
to be available when they are collectible within the current period or soon enough thereafter
to pay liabilities of the current period. For this purpose, the government considers revenues
to be available if they are collected within 60 days of the end of the current fiscal period.
Expenditures generally are recorded when a liability is incurred, as under accrual
accounting. However, debt service expenditures, as well as expenditures related to
compensated absences and claims and judgments, are recorded only when payment is
due.
Property taxes, franchise taxes, licenses, and interest associated with the current fiscal
period are all considered to be susceptible to accrual and so have been recognized as
revenues of the current fiscal period. Only the portion of special assessments receivable
due within the current fiscal period is considered to be susceptible to accrual as revenue of
+■ the current period. All other revenue items are considered to be measurable and available
only when cash is received by the City.
The government reports the following funds:
Major Governmental Funds
The General Fund is the government's primary operating fund. It accounts for all
financial resources of the general government, except those required to be
accounted for in another fund.
The Debt Service Fund was established to account for the accumulation of
resources for, and the payment of principal and interest on certain long -term debt.
f�
1 29
CITY OF EDGEWATER, FLORIDA '
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
Note 1 - Summary of Significant Accounting Policies (Continued):
C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation
(Continued)
Non -Major Governmental Fund Types
Special Revenue Funds account for specific revenue sources that are restricted by
law or administrative action to expenditures for specific purposes.
Capital Projects Funds account for financial resources segregated for the acquisition
or construction of major capital facilities.
Major Proprietary Funds
Water and Sewer Fund is used to account for the operations of the City's water and
wastewater systems, which are financed in a manner similar to private business
enterprises, where the costs, including depreciation, of providing services to the
general public on an ongoing basis are financed primarily through user charges.
Refuse Collection Fund is used to account for the fiscal activities of the City's refuse
collection and disposal operation.
Stormwater Management Fund is used to account for the fiscal activities of the City's
stormwater drainage operation, as well as the funding and payment of related debt.
Non -Major Proprietary Funds
Water and Sewer Development Fee Fund and the Renewal and Replacement Fund
account for amounts reserved for specific enterprise activities.
Fiduciary Funds
Pension Trust Funds account for activities of police officers, firefighters and general
employees retirement plans; which accumulate resources for pension benefit
payments to qualified employees.
Private - sector standards of accounting and financial reporting issued prior to December 1,
1989, generally are followed in both the government -wide and proprietary fund financial
statements to the extent that those standards do not conflict with or contradict guidance of
the Governmental Accounting Standards Board. Governments also have the option of
following subsequent private - sector guidance for their business -type activities and
enterprise funds, subject to this same limitation. The government has elected not to follow
subsequent private- sector guidance.
30
in CITY OF EDGEWATER, FLORIDA
in
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
Note 1 - Summary of Significant Accounting Policies (Continued):
C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation
' (Continued)
As a general rule the effect of interfund activity has been eliminated from the government-
s wide financial statements. Exceptions to this general rule are other charges between. the
!r City's water and sewer function and various other functions of the government. Elimination
of these charges would distort the direct costs and program revenues reported for the
' various functions concerned.
Amounts reported as program revenues include 1) charges to customers or applicants for
goods, services, or privileges provided, 2) operating grants and contributions, and 3) capital
grants and contributions, including special assessments. Internally dedicated resources are
reported as general revenues rather than as program revenues. Likewise, general
revenues include all taxes.
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 water, sewer and stormwater utility funds are
charges to customers for sales and services. The City also recognizes as operating
revenue the portion of tap fees intended to recover the cost of connecting new customers to
the system. Operating expenses for enterprise funds include the cost of sales and services,
administrative expenses, and depreciation on capital assets. All revenues and expenses
not meeting this definition are reported as nonoperating revenues and expenses.
When both restricted and unrestricted resources are available for use, it is the government's
policy to use restricted resources first, then unrestricted resources as they are needed.
D. Assets, Liabilities, and Net Assets or Equity
L 1. Deposits and Investments
The government's cash and cash equivalents are considered to be cash on
hand, demand deposits, and short-term investments with original maturities of
three months or less from the date of acquisition.
Investments of the City are reported at fair value. The City's investments consist
of investments authorized per their investment policy adopted in accordance with
Section 218.415, Florida Statutes.
1 31
CITY OF EDGEWATER, FLORIDA I
NOTES TO FINANCIAL STATEMENTS - Continued '
September 30, 2003
Note 1 - Summary of Significant Accounting Policies (Continued): ,
D. Assets, Liabilities, and Net Assets or Equity - (Continued)
2. Receivables and Payables
Activity between funds that are representative of lending /borrowing
arrangements outstanding at the end of the fiscal year are referred to as either
"due to /from other funds" (i.e., the current portion of interfund loans) or
"advances to /from other funds" (i.e., the non - current portion of interfund loans).
All other outstanding balances between funds are reported as "due to /from other
funds." Any residual balances outstanding between the governmental activities k
and business -type activities are reported in the government -wide financial
statements as "internal balances ".
Advances between funds, as reported in the fund financial statements, are offset
by a fund balance reserve account in applicable governmental funds to indicate
that they are not available for appropriation and are not expendable available
financial resources.
All receivables are shown net of an allowance for uncollectibles. The County .�
bills and collects property taxes and remits them to the City. City property tax
revenues are recognized when levied to the extent that they result in current
receivables. .�
All property is reassessed according to its fair value on the lien date, or January
1 of each year. Taxes are levied on October 1 of each year. Discounts are
allowed for early payment at the rate of 4% in the month of November, 3% in the
month of December, 2% in the month of January, and 1% in the month of
February. The taxes paid in March are without discount. All unpaid taxes
become delinquent on April 1 following the year in which they are assessed. On
or around May 31 following the tax year, certificates are sold for all delinquent
taxes on real property.
3. Inventories and Prepaid Items
All inventories are valued at cost using the first -in /first -out (FIFO) method.
Inventories of governmental funds are recorded as expenditures 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.
32
1
CITY OF EDGEWATER, FLORIDA
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
Note 1 - Summary of Significant Accounting Policies (Continued):
D. Assets, Liabilities, and Net Assets or Equity - (Continued)
4. Restricted assets
Certain proceeds of the City's enterprise fund revenue bonds, as well as certain
resources set aside for their repayment, are classified as restricted assets on the
balance sheet because they are maintained in separate bank accounts and their
use is limited by applicable bond covenants. Assets so designated are identified
as restricted assets on the balance sheet.
i
1
F1
5. Capital assets
Capital assets, which include property, plant, equipment, 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. Capital assets are defined by the City, in accordance
with Chapter 274.02, Florida Statutes, as assets with an initial, individual cost of
$750 or more and an estimated useful life in excess of one year. Such assets
are recorded at historical cost or estimated historical cost if purchased or
constructed. Donated capital assets are recorded at estimated fair market value
at the date of donation.
Pursuant to GASB Statement No. 34, an extended period of deferral (FY 2007)
is available before the requirement to record and depreciate infrastructure assets
(e.g. roads, bridges, sidewalks and similar items) acquired before the
implementation date becomes effective. The City currently intends an early
implementation of this requirement. Infrastructure acquired prior to October 1,
2002 has not been recorded for governmental activities. GASB Statement No.
34 requires the reporting and deprecation of new infrastructure expenditures
effective with the beginning of the implementation year (October 1, 2002.)
The costs of normal maintenance and repairs that do not add to the value of the
asset or materially extend asset lives are not capitalized.
Major outlays for capital assets and improvements are capitalized as projects are
constructed. Interest incurred during the construction phase of capital assets of
business -type activities is included as part of the capitalized value of the assets
constructed.
33
CITY OF EDGEWATER, FLORIDA I
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
Note 1 - Summary of Significant Accounting Policies (Continued): '
D. Assets, Liabilities, and Net Assets or Equity - (Continued)
5. Capital assets (Continued) - '
Capital assets of the City are depreciated using the straight line method over the ,
following estimated useful lives:
Assets
Buildings
Years
10 -50
Improvements
15 -50
Infrastructure
30 -50
Equipment
3 -15
6. Compensated absences
It is the City's policy to permit employees to accumulate earned but unused
vacation and sick pay benefits. Since the City's policy is to pay both vacation
and sick pay when employees separate from service, all vacation and sick pay is
accrued when incurred in the government -wide and proprietary fund financial
statements. A liability for these amounts is reported in governmental funds only
if they have matured, for example, as a result of employee resignations and
retirements. For governmental activities, compensated absences are generally
liquidated by the General Fund.
7. 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 assets. Bond premiums and
discounts, as well as issuance costs, are deferred and amortized over the life of
the bonds using the effective interest method. Bonds payable are reported net
of the applicable bond premium or discount. Bond issuance costs are reported
as deferred charges and amortized over the term of the related debt.
In the fund financial statements, governmental fund types recognize bond
premiums and discounts, as well as bond issuance costs, during the current
period. The face amount of debt issued is reported as other financing sources. ~°
Premiums received on debt issuances are reported as other financing sources
while discounts on debt issuances are reported as other financing uses.
Issuances costs, whether or not withheld from the actual debt proceeds received,
are reported as debt service expenditures.
34
�
WS CITY OF EDGEWATER, FLORIDA
M
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
11
Note 1 - Summary of Significant Accounting Policies (Continued):
D. Assets, Liabilities, and Net Assets or Equity - (Continued)
8. Fund equity
In the fund financial statements, governmental funds report reservations of fund
balance for amounts that are not available for appropriation or are legally
restricted by outside parties for use for a specific purpose. Designations of fund
balance represent tentative management plans that are subject to change.
Note 2 - Reconciliation of Government -Wide and Fund Financial Statements:
1
1 35
A. Explanation of Certain Differences Between the Governmental Fund Statement of
Revenues, Expenditures, and Changes in Fund Balances and the Government -Wide
'
Statement of Activities
The governmental fund statement of revenues, expenditures, and changes in fund
balances includes a reconciliation between net changes in fund balances - total
governmental funds and changes in net assets of governmental activities as reported in
the government -wide statement of activities. One element of that reconciliation explains
that "Governmental funds report capital outlays as expenditures. However, in the
statement of activities the cost of those assets is allocated over their estimated useful lives
and reported as depreciation expense." The details of this $769,982 difference are as
follows:
Capital outlay $ 255,593
Depreciation expense (1,025,575
Net adjustment to decrease net changes in fund balances -
total governmental funds to arrive at changes in net
assets of governmental activities $ (769.982
1
1 35
CITY OF EDGEWATER, FLORIDA
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
Note 2 - Reconciliation of Government -Wide and Fund Financial Statements (Continued):
A. Explanation of Certain Differences Between the Governmental Fund Statement of
Revenues, Expenditures, and Changes in Fund Balances and the Government -Wide
Statement of Activities (Continued)
Another element of that reconciliation states that "the issuance of long -term debt (e.g.,
bonds, leases) provides current financial resources to governmental funds, while the
repayment of the principal of long -term debt consumes the current financial resources of
governmental funds. Neither transaction, however, has any effect on net assets. The
details of this $1,030,261 difference are as follows:
Debt issued or incurred:
Loan proceeds $ 104,630
Principal repayment (1,134,891
Net adjustment to increase net changes in fund balances - total
governmental funds to arrive at changes in net assets of
governmental activities $ 1,030,261
Another element of that reconciliation states that "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." The details of this difference are
as follows:
Compensated absences
Decrease in investment in joint venture
Net adjustment to decrease net changes in fund balances -
total governmental funds to arrive at changes in net assets of
governmental activities
$ (17,535)
(93,078)
1
1 1 )
36
CITY OF EDGEWATER, FLORIDA
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
j Note 3 - Stewardship, Compliance, and Accountability:
Budgetary Information -
The City follows these procedures in establishing the budgetary data reflected in the
financial statements:
(1) Prior to the end of the fiscal year, the City Manager submits to the City Council a
proposed operating budget for the fiscal year commencing the following October
1. The operating budget includes proposed expenditures and the means of
financing them.
(2) Budget workshops are scheduled by the City Manager as needed.
(3) The general summary of the budget and notice of public hearing is published in
the local newspaper.
(4) Public hearings are conducted to obtain taxpayer comments.
(5) Prior to October 1, the budgets are legally enacted through passage of a
ordinance.
(6) The City Manager is authorized to transfer budgeted amounts within and
between divisions and departments; however, any revisions that alter the total
appropriations of any fund must be approved by the City Council.
(7) The level of classification detail at which expenditures may not legally exceed
appropriations is the fund level.
(8) Appropriations lapse at the close of the fiscal year to the extent they have not
been expended.
am (9) Budgets are adopted for the General Fund, Special Revenue Funds, Debt
Service Funds and the Capital Projects Fund on a basis consistent with generally
accepted accounting principles. Budgets are also adopted for the enterprise
funds: however, these data are not presented under generally accepted
accounting principles.
(10) The City Council, by Ordinance or Resolution, may make supplemental
appropriations in excess of those originally estimated for the year up to the
amount of available revenues. Budgeted amounts presented in the
accompanying financial statements have been adjusted for legally authorized
revisions.
L
ift 37
CITY OF E:DGEWATER, FLORIDA I
NOTES TO FINANCIAL STATEMENTS - Continued ,
September 30, 2003
Note 4 - Deposits and Investments: I
Deposits
At year -end, the carrying amount of the City's deposits was $2,220,166 and the bank
balance was $2,332,071. Petty cash fund of $1,750 are not on deposit with a financial
institution, and fiduciary fund cash of $57,454 held by the pension funds are not in the
City's bank. All bank deposits were covered by Federal Depository Insurance or held in
banks that are members of the State of Florida's Collateral Pool as specified under Florida
law. This limits local government deposits to "qualified public depositories." The State of
Florida Collateral Pool is a multiple financial institution pool with the ability to assess its
members for collateral shortfalls if a member institution fails. For this reason, the City
considers its deposits insured or collateralized.
Investments
Investments in all fund types are stated at fair value, which is the amount for which an
investment could be exchanged in a current transaction between willing parties, other than
in a forced liquidation sale. Fair value is based on quoted market prices. Changes in the
fair value of investments are recognized as revenue and included in investment income.
The City's investment policies are governed by state statute and city ordinance.
Authorized investments are:
(a) The Local Government Surplus Funds Trust (SBA)
(b) SEC registered money market funds
(c) Interest - bearing time deposits or savings accounts
(d) Direct obligations of the U.S. Treasury
(e) Federal agencies and instrumentalities
(f) Securities of, or other interests in, any open -end or closed -end management -type
investment company or investment trust registered under the Investment Company
Act of 1940
(g) Other investments authorized by ordinance
38
"" CITY OF EDGEWATER, FLORIDA
an
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
M
Note 4 - Deposits and Investments (Continued):
Investments (Continued)
Investments of the Municipal Police Officers' Retirement Trust and General Employees'
Pension were managed by Principal Mutual Life Insurance Company. Investments
consist principally of debt and equity mutual funds, all of which are authorized by the
City. The Firefighters' Pension Fund's investments are governed by an investment policy
adopted by the Fund's Board of Trustees. Investments consist of debt and equity mutual
funds, all of which are allowed by the policy.
Most of the City's investments besides pension funds are invested in the SBA, an
investment pool administered by the State of Florida.
Investment held in the State Board Administration Fund consist of short-term federal
agency obligations, treasury bills, repurchase agreements and commercial paper. The
SBA is not a registrant with the Securities and Exchange Commission (SEC); however, the
SBA has adopted operating procedures consistent with the requirements for a 2a -7 like
pool and the fair value of the position in the pool is equal to the fair value of the pool
shares. Such investments are stated at amortized cost in the accompanying financial
statements. Investment income is recognized as earned and is allocated to the
participating funds based on their equity participation.
The following levels of credit risk apply to the investments of the City:
Category 1
Insured or registered, held by the City or its agent in the City's name.
Category 2
Uninsured or unregistered, held by a counterparty's trust department or agent in the City's
name.
L Category 3
Uninsured and unregistered, held by a counterparty or its trust department or agent, but
not in the City's name.
e
t
39
CITY OF EDGEWATER, FLORIDA
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
Note 4 - Deposits and Investments (Continued):
Investments (Continued)
Investments in the State Board of Administration Local Government Investment Pool and
Mutual Funds are not required to be categorized since these investments
are in pooled
investment funds and therefore not evidenced by securities that exist in physical or book
entry form. The following schedule shows the City's investments at September 30, 2003,
classified where appropriate as to their respective level of credit risk:
Credit
Risk
Fair Value
Category
State Board of Administration Fund $10,105,530
N/A
U.S. Government Securities 1,126,107
1
Pension Mutual Funds 16,149,779
N/A
$27,381,416
Note 5 - Receivables:
Receivables as of year end for the City's individual major funds, including
the applicable
allowances for uncollectible accounts, are as follows:
Water and Refuse Stormwater
General Sewer Collection Management
Fund Fund Fund Fund
Total
Receivables:
Accounts $64,767 $835,157 $94,651 $41,271
$1,035,846
Less allowance for
uncollectible accounts 47 985) 7( 9,685 - -
(127,670
$16,782 7' 7 4 1 $ 41,271
I-9Q 8,176
40
CITY OF EDGEWATER, FLORIDA
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
W
E
t
L
Note 6 - Capital Assets:
Capital asset activity for the year ended September 30, 2003 was as follows:
Governmental activities:
Capital assets, not being
depreciated:
Land
Construction in progress
Total capital assets, not being
depreciated
Capital assets, being depreciated:
Buildings
Improvements
Machinery and equipment
Infrastructure
Total capital assets, being
depreciated
Less accumulated depreciation for:
Buildings
Improvements
Machinery and equipment
Infrastructure
Total accumulated depreciation
Total capital assets, being
depreciated, net
Governmental activities capital
assets, net
Beginning
Balance Ending
Restated Increases Decreases Balance
$ 1,845,196 $ 1,934,240 $ - $ 3,779,436
5,546,244 605,767 (5,268,876 883,135
7,391,440 2,540,007 (5,268,876 4,662,571
4,370,864 - - 4,370,864
14,210,363 232,872 - 14,443,235
3,228,899 247,843 (67,807) 3,408,935
- 625,460 - 625,460
21,810,126 1,106,175 (67,807 22,848,494
(1,333,982)
(142,789)
- (1,476,771)
(4,484,486)
(583,426)
- (5,067,912)
(2,333,644)
(283,723)
60,054 (2,557,313)
-
(15,637
- (15,637
(8,152,112
(1,025,575)
60,054 (9,117,633
13,658,014 80,600 (7,753 13,730,861
N I'll. . .
M 41
CITY OF EDGEWATER, FLORIDA
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
Note 6 - Capital Assets (Continued):
Business -type activities:
Capital assets, not being
depreciated:
Land
Construction in progress
Total capital assets, not being
depreciated
Capital assets, being depreciated:
Buildings
Improvements
Machinery and equipment
Total capital assets, being
depreciated
Less accumulated depreciation for:
Beginning
Balance Increases Decreases
$ 676,827
$ -
$ -
3,100,793
306,361
(2,319,214
3,777,620
306,361
(2,319,214
20,023,942
2,309,128
-
35,675,080
3,015,675
-
2,193,119
536,619
(41,599
57,892,141 5,861,422 (41,599
I �
1
Ending
(6,540,031)
e
Balance
Improvements
(7,060,847)
(823,511) -
$ 676,827
Machinery and equipment
1,087,940
(256,479 (32,597
1,764,767
Total accumulated depreciation
22,333,070
38,690,755
2,688,139
63,711,964
Buildings
(6,540,031)
(724,890) -
(7,264,921)
Improvements
(7,060,847)
(823,511) -
(7,884,358)
Machinery and equipment
(1,370,107
(256,479 (32,597
(1,593,989
Total accumulated depreciation
J 14,970,985 )
(1,804,880 (32,597
(16,743,268
Total capital assets, being
depreciated, net 42,921,156 4,056,542 (9,002 46,968,696
Business -type activities capital
assets, net $46,698,776 $ 4,362.M $(2 328 216 $48 733,463
Depreciation expense was charged to functions /programs as follows:
Governmental activities:
General government $ 35,847
Public safety 243,550
Transportation /public works 526,974
Leisure services 219,204 �-
Total depreciation expense - governmental activities $1 025 575
Business -type activities:
Water and sewer $1,529,122
Refuse collection 69,432
Stormwater management 199,379
Total depreciation expense - business -type activities JLZa7,95
42
ftl.
CITY OF EDGEWATER FLORIDA
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
Note 7 - Long -Term Debt:
Revenue Bonds
The City issues bonds where the City pledges revenue derived from the acquired or
constructed assets to pay debt service. Revenue bonds have been issued for business -type
activities. The original amount of amounts of revenue bonds issued in prior years is described
below. Revenue bonds outstanding at year end are as follows:
Business -Type Activities
Water and Sewer 2.75-5.5%
Revenue Bonds - Series 1993 (4/1 & 10/1) 10/1/21 $12.460.000 $11,265,000
Water and Sewer 5.4-7.0%
Revenue Bonds - Series 1991 (4/1 & 10/1) 10/1/21 $13.580.000 675,000
L Total $11,940,000
These Water and Sewer Revenue Bonds are secured by a first lien on and pledge of the net
revenues of the water and sewer system and a first lien on and pledge of allowable impact
fees imposed on new users of the system.
The Water and Sewer Revenue Bonds resolution provide for:
(1) Establishment and maintenance of various funds and accounts
(2) Restrictions on the use of cash from operations in order of priority -
(a) Deposits are made to the Operations and Maintenance Fund each
month in an amount which will pay the costs of operation and
maintenance for the next month;
(b) Deposits to the Sinking Fund are made monthly in an amount equal to
one -sixth (1/6) of the interest coming due on the next semi - annual
interest payment date and one - twelfth (1/12) of the bond amortization
installment coming due during the next year:
(c) Deposits to the Reserve Fund are required to make up any deficiency in
its balance as compared to the reserve equipment;
k
t
4
L 43
CITY OF EDGEWATER, FLORIDA '
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
Note 7 - Long -Term Debt (Continued): '
Revenue Bonds (Continued)
(d) Deposits to the Renewal and Replacement Fund are required each
month in an amount equal to one - twelfth (1/12) of five per centum (5 %)
of the gross revenues of the system for the previous fiscal year;
provided, however, that so long as there shall be on deposit in the
Renewal and Replacement Fund a balance of at least five per centum
(5 %) of the value of the fixed assets of the system, no additional
deposits shall be required;
(e) Deposits will next be made into the Rate Stabilization Fund for the
amount budgeted for the then current period; and
(f) Thereafter for any lawful purposes.
(3) Early redemption:
The bond resolution provides for early redemption of outstanding bonds at call rates
varying from 100% to 102% of the instruments' face value, dependent upon the call
date.
Annual requirements to amortize water and sewer revenue bonds outstanding as of
September 30, 2003 are as follows:
Business -Type Activities
Year ending September 30,
Principal
Interest r „
2004
$ 405,000
$ 663,328
2005
425,000
641,968
2006
450,000
619,143
2007
470,000
594,480
2008
500,000
568,763
2009 -2013
2,950,000
2,393,887
2014 -2018
3,865,000
1,473,775
2019 -2021
2,875,000
327,350
Total
$11,940,000
SZ282, 4
44
CITY OF EDGEWATER, FLORIDA
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
t
fl
L - I
i
Note 7 - Long -Term Debt (Continued):
State Revolving Fund Loans
The City financed a portion of its wastewater improvements for the Florida Shores
capital improvement projects with two loans from the State of Florida Revolving Fund
loan program. The City received the loans on a reimbursement basis as costs were
incurred. The City executed agreements with the State for these loans in the amount of
$25,809,428.
The State Revolving Fund (SRF) loans are secured by a junior lien on and pledge of the
net revenues of the water and sewer system and the special assessment revenues
levied against the benefiting property owners in Florida Shores. The assessments are
payable over 20 years with interest of 6.007% until December 1, 1994 and of 5.35%
thereafter. Since many taxpayers take advantage of prepayment discounts, actual
interest rates paid may be less than the stated amounts.
The SRF loans consist of the following:
Interest Rates:
Payment Frequency:
Payment Amount:
Maturity Date:
Treatment Loan
3.16% to 3.78%
20 annual payments
$516,458
September 30, 2013
Collections Loan
3.57% to 3.78%
20 annual payments
$1,294,980
October 31, 2013
Annual debt service requirements to maturity on the State Revolving Fund Loan are as
follows:
Year ending September 30,
2004
2005
2006
2007
2008
2009 -2013
2014
Total
Business —Type Activities
Principal Interest
$ 1,230,638
$ 580,799
1,275,879
535,558
1,322,786
488,653
1,371,417
440,021
1,421,839
389,599
7,932,933
1,124,258
1,249,372
45,608
1 45
CITY OF EDGEWATER, FLORIDA
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
Note 7 - Long -Term Debt (Continued):
Notes Payable
During 2002, the City issued the following revenue notes:
Water and Sewer General Long -term Debt
Revenue Note, Series 2002 Revenue Note, Series 2002A
Original amount issued
$5,140,000
$2,540,000
Issue date
March 13, 2002
March 13, 2002
Final maturity
October 1, 2012
October 1, 2012
Interest due
Monthly
Monthly
Interest rate
Adjusted Libor
Adjusted Libor
The Water and Sewer Revenue, Series 2002, notes are secured by all water and sewer
revenues of the City. Water and sewer revenues include revenue from the operation of the
water and sewer system as well as the special assessments payable to the City with respect
to water service to be provided by the City to the residents of Waterway Park.
The Revenue Note, Series 2002A, is secured by a covenant to budget and appropriate from
Non -Ad Valorem funds.
Debt service requirements for these revenue notes using interest rate of 1.607% at
September 30, 2003 are:
Year Ending
Governmental Activities
Business Type
Activities
September 30
Principal
Interest
Principal
Interest
2004
$ 254,000
$ 36,736
$ 514,000
$ 74,340
2005
254,000
32,654
514,000
66,080
2006
254,000
28,572
514,000
57,820
2007
254,000
24,491
514,000
49,560
2008
254,000
20,409
514,000
41,300
2009 -2013
1,270,000
40,818
2,570,000
82,600
Total:
SZ 4 QQ
$183,680
$5-140-M
sazuW
The City also entered into an agreement to borrow money from Florida Inland Navigation
District (FIND) for land and improvements in a business /industrial park. The final amount of
the note payable after $104,630 receaved in 2003 is $5,056,567. The note shall be paid in ten
equal installments of $505,657 each starting August 26, 2003. For the first five years, no
interest shall accrue on the outstan&ng principal balance. Starting August 26, 2007, interest
shall begin to accrue on the outstanding principal balance at an interest rate equal to interest
available form the State Board Administration (SBA).
46
CITY OF EDGEWATER, FLORIDA
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
Note 7 - Long -Term Debt (Continued):
Notes Payable (Continued)
Debt service requirements for the FIND note payable are as follows:
Year Ending
Governmental Activities
September 30,
Principal
Interest
2004
$ 505,657
$ -
2005
505,657
-
2006
505,657
-
2007
505,657
-
2008
505,657
33,373
2009 -2012
2,022,625
66.747
4.550.910
$1Q412
The City also incurred notes payable relating to paving and stormwater improvements at
Florida Shores. The original amount of these notes issued in prior years is described below.
A portion of these notes are secured by a pledge of assessments levied on property within the
assessed area. In the event that a deficiency exists because of unpaid or delinquent
assessments, the City must provide resources to cover the deficiency until other resources, for
example, foreclosure proceeds, are received.
I The special assessment and stormwater notes payable consist of the following:
Series 1995A
Interest Rates:
Interest Dates:
Final Maturity:
Original Amount Issued:
5.22%
April 1, October 1
October 1, 2010
$9,234,660
Series 19956
5.58%
April 1, October 1
October 1, 2010
$3,964,740
The 1995 Notes are secured by the revenues pledged in order of priority; (1) assessment
revenues, (2) Stormwater Revenues, (3) Utility Taxes, (4) All Non - Advalorem Revenues
(except Franchise Taxes).
I
i�
47
CITY OF EDGEWATER, FLORIDA
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
Note 7 - Long -Term Debt (Continued):
Notes Payable (Continued)
The Special Assessment and Stormwater Revenue Notes resolutions provide for:
1. Establishment and maintenance of Special Assessment Improvement Notes
Sinking Fund and related accounts.
2. Restrictions on the use of cash from operations in order of priority.
(a) All Special Assessments shall be applied and deposited only into the 1995
subaccounts listed above. Moneys and Authorized Investments on deposit at
any time in the 1995 subaccounts may be used only for the payment of Debt
Service on, or redemption of the price of, the 1995 Bonds.
(b) All Stormwater Fees shall be deposited into the Stormwater Utility Management
Fund ( "the "Utility Fund "). After the provision for the payment of operating
expenses of the City's Stormwater Utility, the City shall transfer to the 1995
Notes subaccount Stormwater Utility Fees until the aggregate amount
transferred is equal to the amount certified by the City's Director of Finance as
the portion of that fiscal year's debt service necessary to be paid out of the
Stormwater Utility Fees.
(c) All Non - Advalorem Revenues (except Franchise Taxes) shall make up for any
deficiency in meeting the debt service requirement after all of the
aforementioned pledged revenues have been exhausted.
3. Early redemption:
The City may prepay up to 10% without penalty. Should the prepayments
exceed the amount allowed by the bank, the prepayments are subject to a
penalty using a predetermined formula based on certain interest factors.
h,
48 1
1
CITY OF EDGEWATER, FLORIDA
' NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
' Note 7 - Long -Term Debt (Continued):
Notes Payable (Continued)
Annual requirements to amortize the special assessment and stormwater notes are as follows:
Year Ending Governmental Activities Business -Type Activities
September 30 Principal Principal Principal Interest
A• 2004 $ 929 S=4
During 2003 the City purchased from Terra Mar Utilities a utility consisting of water supply
treatment and distribution system and a sewage collection, treatment and disposal system for
$750,000. A down payment of $150,000 was made in July 2003 and the balance of $600,000
is to be paid annually in six payments of $100,000. All annual payments are interest free.
Annual debt service requirements are as follows:
Year Ending
Governmental Activities
Business Type
Activities
Principal Interest
September 30
Principal
Interest
Principal
Interest
100,000
2004
$ 639,151
$ 272,220
$ 264,262
$112,551
100,000
2005
673,650
237,721
278,526
98,287
100,000 -
2006
710,012
201,358
293,560
83,253
2007
748,340
163,030
309,407
67,406
2008
788,738
122,632
326,110
50,703
2009 -2010
1,707,422
115,218
705,940
47,638
Total:
$5,267 313
$1,112 179
$2,177,805
The City has a note payable incurred in
a prior year for the purchase of
equipment for the
countywide 8001VIH2 Radio System.
Payments are
due semi - annually
through 2004 as
follows:
Year Ending Governmental Activities Business -Type Activities
September 30 Principal Principal Principal Interest
A• 2004 $ 929 S=4
During 2003 the City purchased from Terra Mar Utilities a utility consisting of water supply
treatment and distribution system and a sewage collection, treatment and disposal system for
$750,000. A down payment of $150,000 was made in July 2003 and the balance of $600,000
is to be paid annually in six payments of $100,000. All annual payments are interest free.
Annual debt service requirements are as follows:
,•
Year Ending
Business -Type Activities
September 30
Principal Interest
2004
$100,000 $
2005
100,000
2006
100,000 -
2007
100,000
2008
100,000
2009
100,000 -
o-
600.000 $ -
,•
CITY OF EDGEWATER, FLORIDA
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
Note 7 - Long -Term Debt:
Changes in Lonq -Term Liabilities
Long -term liability activity for the year ended September 30, 2003 was as follows:
Beginning Ending
Balance Additions Reductions Balance
Governmental activities:
$ -
Notes payable -
$ 254,000
Revenue note,
(505,656)
Series 2002A
$ 2,540,000
FIND Note
4,951,936
Special assessment
639,151
note with government
(23,455
commitment
5,873,733
800 MHZ Note
48,096
Total notes
1,423,449
payable
13,413,765
Compensated absences
839,520
Governmental activity
$(1.135,531
long -term liabilities
$ 14 253 285
Business -type activities:
$ (385,000)
Bonds payable -
$ 405,000
Revenue bonds
$ 12,325,000
Less deferred amount:
-
Issuance discount
(130,963
Total bonds
405,000
payable
12,194,037
State revolving loan
16,991,868
Notes payable -
-
Revenue note,
514,000
Series 2002
5,140,000
Stormwater note
2,428,533
800 MHZ Note
9,098
Terra Mar Note
-
Total notes
-
payable
7,577,631
Compensated absences
232,00(
Business -type activity
882,924
long -term liabilities
i1jIgUN
Due Within
One Year
$ -
$ -
$ 2,540,000
$ 254,000
104,630
(505,656)
4,550,910
505,657
-
(606,420)
5,267,313
639,151
-
(23,455
24,641
24,641
104,630
(1,135,531
12,382,864
1,423,449
17,535
-
857,055
85,705
$122165
$(1.135,531
$13.239.91
$1'.509.154
$ -
$ (385,000)
$11,940,000
$ 405,000
-
11,255
(119,708
-
-
(373,745
11,820,292
405,000
-
(1,187,004)
15,804,864
1,230,639
-
-
5,140,000
514,000
-
(250,728)
2,177,805
264,262
-
(4,436)
4,662
4,662
600,000
-
600,000
100,000
600,000
(255,164
7,922,467
882,924
114.334
-
346,334
34,633
14 4 (1.815.913 $35 893.957 2 1
M
CITY OF EDGEWATER, FLORIDA
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
Note 8 - Interfund Receivables, Payables and Transfers:
The composition of due to /from other funds at September 30, 2003 is as follows:
Receivable Fund Payable Fund Amount
General Water and Sewer $275,167
Water and Sewer Stormwater Management 115,924
Interfund transfers for the year ended September 30, 2003 consisted of the following:
Transfer In
51
Debt
Water
General
Service
and Sewer Nonmajor
Fund
Fund
Fund Business -type
Total
Transfer Out:
General Fund
$ -
$353,429
$ 3,242 $ -
$ 356,671
Water and Sewer
Fund
500,000
-
- 270,809
770,809
Refuse Collection
Fund
200,000
-
- -
200,000
Stormwater Management
Fund
55,000
-
- -
55,000
Nonmajor Business -
Type Funds
-
-
376,407 -
376,407
Total
s�
1 7
Transfers are used to (1)
move revenues
from the
fund that statute or budget requires to
collect them to the fund
that statute
or budget
requires to expend them and
(2) move
receipts restricted to debt
service from
the funds as debt service payments become due.
51
CITY OF EDGEWATER, FLORIDA r
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
Note 9 - Defined Benefit Retirement Plans:
Plan Descriptions:
No
Police Officers' Retirement Trust Fund - The Police Officers' Retirement Trust Fund
is a single employer defined benefit retirement system established pursuant to state
statute. The funding methods and determination of benefits payable are provided in the
various acts of the Florida Legislature, the Board of Trustees, and the City Council. The
statutes provide, in general, that funds are to be accumulated from employee r '
contributions, City contributions, state appropriations and income from investment of
accumulated funds. Actuarial deficiencies, as determined by the state are funded by the
City. The investments of the fund are administered, managed and operated by its Board
of Trustees using the services of the Finance Department and Principal Mutual Life
Insurance Company. Investments are reported at fair value.
Full -time police officers are eligible to participate in the Police Officers' Retirement Trust
Fund on the first of the month following the completion of three months of continuous
service with vesting beginning upon their first day of employment with the City.
Participating police employees contribute 6% of their salary to the plan. The City is
required by statute to contribute remaining amounts necessary based upon actuarial
valuations to the fund as performed in accordance with State Statute. Employees vest
for full benefits after five years of service. Benefit amounts are calculated based on the
three years which give the highest average out of the last five years. Members will
receive a benefit amount equal to 2% of that average multiplied by years of actual r
service up to October 1, 1987, and 3% of that average multiplied by years of actual
service after October 1, 1987.
General Employees' Pension Fund - The General Employees' Pension Fund is a
single employer defined benefit retirement system and contains the assets of the n
General Employees' Pension Fund. The funding methods and determination of benefits
payable are provided by various acts of the City Council, including subsequent
amendments thereto. The code provides, in general, that funds are to be accumulated
from City contributions, and income from investment of accumulated funds. Investments
are reported at fair value.
The General Employees' Pension Fund includes all full -time City employees, except
police, firefighters and City Manager.
52 1
1 CITY OF EDGEWATER, FLORIDA
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
Note 9 - Defined Benefit Retirement Plans (Continued):
Plan Descriptions (Continued):
General Employees' Pension Fund (Continued) - Employees become eligible for the
plan after three months of continuous employment with vesting beginning as of the first
day of employment. Active members are required to contribute 2.5% to the plan. The
City's policy is to contribute amounts as determined by actuarial valuations. Employees
vest for full benefits after five years of service. Benefit amounts are calculated based on
' the three consecutive years which give the highest average out of the last ten years.
Members will receive a benefit amount equal to 2% of that average multiplied by years of
accrual service.
The General Employees' Pension Fund was amended in October 1996, which closed off
the plan to any new employees hired by the City after October 1, 1996. Employees hired
after October 1, 1996, however, are eligible for the City's 401(a) Defined Contribution
Plan. Employees hired prior to October 1, 1996, and not vested in the General
Employees' Pension Fund as of September 30, 1997, may elect to participate in the
401(a) Defined Contribution Plan.
40 Firefighters' Pension Fund - The Firefighters' Pension Fund is a single employer
defined benefit retirement system established pursuant to state statute in July 1990, with
an effective date of November 1989. The funding methods and determination of benefits
payable are provided in the various acts of the Florida Legislature, Firefighters' Pension
Board and the City Council. The statutes provide in general, that funds are to be
accumulated from employee contributions, City contributions, state appropriations and
income from investment of accumulated funds. Investments are reported at fair value.
Full -time firefighters are eligible to participate in the Firefighters' Pension Fund upon
their first day of employment with the City. Participating fire employees contribute 6% of
their salary to the plan. The City is required by statute to contribute remaining amounts
necessary based upon actuarial valuations to the fund as performed in accordance with
State Statute. Employees vest for full benefits after five years of service. Benefit
amounts are calculated based on the five years which give the highest average out of
the last ten years. Members will receive a benefit amount equal to 3% of that average
multiplied by years of accrual service.
IN
i1
53
CITY OF EDGEWATER, FLORIDA
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
Note 9 - Defined Benefit Retirement Plans (Continued):
Plan Descriptions (Continued):
Membership data of the Pension Plans are summarized as follows:
Police General
Officers Employees Firefighters
Retirees and beneficiaries currently
receiving benefits and vested
terminated employees 15 82 1
Active employees:
Fully vested 26 71 9
Nonvested 9 0 9
Significant Accounting Policies - City of Edgewater's financial statements for the three
pension funds are prepared using the accrual basis of accounting. Employer and plan
member contributions are recognized in the period that contributions are due.
Investments in the three pension funds are reported at fair value according to the
independent custodian for each plan using various third party pricing sources.
Publicly available financial reports for each plan, that include detailed actuarial data, can be
obtained from the City's Finance Department.
In 1997 the City adopted GASB Statement No. 25 on pension accounting and reporting.
This Statement requires the disclosure of any investments in any one organization that
represents 5% or more of plan net assets. All investments in the Police Officers' Retirement
Trust Fund and the General Employees Pension Fund are invested in the Principal Financial
Group's various investment portfolios. There are no investments in any one organization in
the Firefighters' Pension Fund that exceeds 5% of plan net assets. None of the plans held
securities issued by the employer.
Contribution Requirements and Contributions Made - The Florida Legislature, City
Council and each Pension Board governs the City and employee contribution requirements
for the Police Officers' Retirement Trust Fund and Firefighters' Pension Fund. The City's
contribution to the General Employees' Pension Fund is an actuarially determined periodic
amount that increases gradually over time so that sufficient assets will be available to pay
benefits when due. The employees' contribution is 2.5% of their salary.
The City's contribution to the Police Officers' Retirement Trust Fund and Firefighters'
Pension Fund is an actuarially determined periodic amount. The employees' contribution for
these plans is 6% of their salary. Contributions provided by the State of Florida are in
accordance with State statutes.
1
I
54
1
CITY OF EDGEWATER, FLORIDA
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
Note 9 - Defined Benefit Retirement Plans (Continued):
Annual Pension Cost and Net Pension Obligation - The City has contributed the Annual
Required Contribution (ARC) each year since plan inception and thus has not had, or had
need to report, a Net Pension Obligation (NPO). In accordance with GASB Statement No.
27 the City calculated the potential for a net pension liability (asset) and reaffirmed that
none existed at September 30, 2003.
Required supplementary information is as follows:
Schedule
of Contributions from the Employer
General Employees
Police Officers
Firefighters
Annual
Percentage
Annual
Percentage
Annual
Percentage
Year Ended Required
of ARC
Required
of ARC
Required
of ARC
ICI
September 30 Contribution Contributed
Contribution
Contributed
Contribution Contributed
1998
462,796
100%
172,948
100%
61,653
100%
1999
268,589
100%
181,224
100%
71,331
100%
2000
301,864
100%
350,071
100%
99,161
100%
2001
360,769
100%
351,770
100%
140,163
100%
L 2002
439,160
100%
329,225
100%
140,163
100%
2003
436,006
100%
410,431
100%
146,735
100%
Schedule of Funding
Progress - Police Officers' Retirement Trust Fund
Unfunded
Actuarial
(Assets in
Accrued
Excess of) AAL
Actuarial
Liability (AAL) -
Unfunded
as a Percentage
Actuarial
Value of
Frozen Entry
(Assets in
Funded
Covered
of Covered
Valuation
Assets
Age
Excess of) AAL Ratio
Payroll
Payroll
Date
(a)
(b)
(b -a)
(b -a)
(c)
((b -a) /c)
10/01/96
1,679,636
2,001,604
321,968
83.9
918,376
35.1
10/01/97
1,827,091
2,166,313
339,222
84.3
1,001,927
33.9
10/01/98
2,344,955
2,694,072
349,117
87.0
1,049,925
33.3
10/01/99
2,672,255
4,313,393
1,641,138
61.0
995,602
164.8
M
10/01/00
3,307,503
4,861,764
1,554,261
68.0
1,041,134
149.2
10/01/01
3,868,547
5,334,718
1,466,171
72.5
980,382
149.5
10/01/02
4,514,711
6,339,886
1,825,175
71.0
1,074,297
170.0
'
55
CITY OF EDGEWATER, FLORIDA ,
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2003
Note 9 - Defined Benefit Retirement Plans (Continued):
Notes to the Required Supplementary Information - The information presented in the
required supplementary schedule was determined as part of the actuarial valuation at
October 1, 2002. Additional information applies as follows:
As noted above, the General Employees and Firefighters Plan use the aggregate actuarial
cost method, which does not identify or separately amortize unfounded actuarial liabilities.
Therefore, presentation of a schedule of funding progress is not required. Since the Police
Officers Plan uses the frozen entry age actuarial cost method, a schedule of funding
progress has been presented above.
56
General
Police
Employees
Officers
Firefighters
Valuation Date
10/01/01
10/01/01
10/01/01
Actuarial Cost Method
Aggregate Cost
Frozen Entry Age
Aggregate Cost
Amortization Method
N/A
Level Percentage
N/A
Remaining Amortization Period
N/A
28 open
N/A
4 Year Smoothed
Asset Valuation Method
Market Value
Market
Market Value
Actuarial Assumptions:
Investment rate of return
8.0%
7.25%
7.5% -�
Projected salary increases
(including inflation of 3.0 %)
7.5%
7.5%
7.5%
Retirement age
55 and 5 years of
55 with 5 years of
55 with 5 years ,..
plan participation or
accrued service
of accrued
20 years of plan
or after 25 years
service or after
participation,
of accrued
25 years of
whichever is
service
accrued service
earliest
As noted above, the General Employees and Firefighters Plan use the aggregate actuarial
cost method, which does not identify or separately amortize unfounded actuarial liabilities.
Therefore, presentation of a schedule of funding progress is not required. Since the Police
Officers Plan uses the frozen entry age actuarial cost method, a schedule of funding
progress has been presented above.
56
1
CITY OF EDGEWATER, FLORIDA
L NOTES TO FINANCIAL STATEMENTS - Continued
r
September 30, 2003
IP Note 10 - Defined Contribution Pension Plans:
an
General Employees - The City adopted a defined contribution plan effective October 1,
1996. The plan is a money purchase plan administered for the City by the Principal
Financial Group. Eligible employees are employees hired effective October 1, 1996, or
thereafter that would otherwise qualify for the General Employees' Pension Plan.
Employees hired prior to October 1, 1996, and not vested in the General Employees'
Pension Plan may also elect, instead, to participate in the defined contribution plan. The
plan provides for an employer contribution equal to 12% of employee earnings. Employees
who elect to participate in this plan that were hired prior to October 1, 1996 will have the
following contributions made:
Term of % Contributed for % Contributed for
Employment Prior Earnings Prior to Earnings After
to October 1, 1996 October 1, 1996 October 1, 1996
3 months - 2 years 10% 12%
2 years — 4 years 11 12
4 years — 5 years 12 12
Employees are 100% vested immediately upon participation. Employees direct the
investment of funds contributed to the plan on their behalf. Employer contributions made
during the year amounted to $171,897.
Note 11 - Commitments and Contingencies:
t
Litigation - The City is engaged in various liability claims incidental to the conduct of its
general government operations at September 30, 2003. While the ultimate outcome of the
litigation cannot be determined at this time, management believes that any amounts not
covered by insurance, if any, resulting from these lawsuits would not materially affect the
financial position of the City.
Risk Management - The City is exposed to various risks of loss related to torts; theft of,
damage to and destruction of assets; errors and omissions; and natural disasters for which
the City carries commercial insurance. Liability limits are in excess of $39.1 million and
terms associated with property insurance include total deductibles of approximately
$11,000, with a 90% coinsurance provision. The City has obtained excess insurance
coverage with varying retentions and limits to further limit exposure to large losses. There
have been no significant reductions in insurance coverage from the prior year and
settlements have not exceeded insurance coverage during the past three years.
57
CITY OF EDGEWATER, FLORIDA
NOTES TO FINANCIAL STATEMENTS - Continued
September 30, 2002
Note 12 - Joint Venture:
On January 11, 2002 the Cities of Port Orange, New Smyrna and Edgewater entered into
an interlocal agreement to provide a consolidated (Dispatch) communications and record
system servicing law enforcement, fire, rescue and emergency communications for each of
the Cities. This entity, know as Communications Interlocal Agency (Cl Agency) was
established pursuant to Florida Statute Section 163.01 (7). The Cl Agency operates as a
public entity using a fiscal year ending September 30. The interlocal agreement expires on
January 1, 2007, unless renewed by the three cities. On dissolution of the Cl Agency, the
net assets will be distributed in the same proportional share to the financial contribution
made by the cities.
The Cl Agency is an instrumentality of the municipal parties and is entitled to sovereign
immunity except where waived by general law. It operates pursuant to direction from its
governing board. The governing board is comprised of three mayors for the respective
Cities, mentioned above. Operating guidelines, procedures, designations and restrictions
are determined by this governing body.
All cost of the Cl Agency is allocated to Port Orange, New Smyrna and Edgewater in the
respective amounts of 50 %, 25% and 25 %. Therefore, the City of Edgewater has an
ongoing financial responsibility to pay its share of the cost of operations.
The majority of initial, first year charges to the respective Cities were for the acquisitions of
capital purchases. These initial charges were not in accordance with the above allocations, „r
as some Cities owned certain pieces of equipment prior to the inception of the Entity. The
different proportions of existing equipment and other capital already owned by the three
participating Cities gives rise to a disproportionate allocation of net assets. The City of
Edgewater's net investment in the joint venture is reported in the government -wide
statement of net assets and totals $243,289 at September 30, 2003. The net investment in
the joint venture decreased $93,078 from September 30, 2002. Complete financial r
statements for the Cl Agency are available upon request.
A
H
58
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F,
t
1
COMBINING AND INDIVIDUAL FUND
STATEMENTS AND SCHEDULES
w
ri
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1
MAJOR GOVERNMENTAL FUNDS
Debt Service
Debt Service Fund - This fund was established to account for the accumulation
of principal and interest for certain general long -term debt.
1
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n
U
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0
CITY
OF EDGEWATER,
FLORIDA
DEBT SERVICE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND
CHANGES
IN
FUND BALANCES - BUDGET
AND ACTUAL
For The
Year Ended September 30, 2003
Variance With
Final Budget
Budgeted Amounts
Actual
Positive
Original Final
Amounts
(Negative)
Revenues:
Impact fees/ special assessments
$ 426,781 $
426,781 $
399,888
$ (26,893)
Investment income
207,147
207,147
224,509
17,362
Total revenues
633,928
633,928
624,397
(9,531)
Expenditures:
Debt service:
Principal retirement
608,576
608,576
606,420
2,156
Interest and fiscal charges
308,034
308,034
306,945
1,089
Total expenditures
916,610
916,610
913,365
3,245
Excess (Deficiency) of
Revenues Over Expenditures
(282,682)
(282,682)
(288,968)
(6,286)
Other Financing Sources (Uses)
Transfers in
353,429
353,429
353,429
Net other financing sources (uses)
353,429
353,429
353,429
-
Net Change in Fund Balance
70,747
70,747
64,461
(6,286)
Fund Balances - Beginning
493,011
493,011
493,011
-
Fund Balances - Ending
$ 563,758 $
563,758 $
557,472
$ (6,286)
r
59
1
1
I
1
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i
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in
ft
ft
W
NONMAJOR GOVERNMENTAL FUNDS
Special Revenue Funds
Special Law Enforcement - This fund was established to receive revenues derived
Trust Fund from confiscated property obtained during the
enforcement of illegal operations. Proceeds are utilized
strictly for law enforcement purposes, exclusive of
salaries and vehicles. Such purposes may include drug
education programs such as DARE.
Police Impact Fees Fund - This fund was established to account for police impact
fees collected from new developments constructed in the
City.
Fire Impact Fees Fund - This fund was established to account for fire impact fees
collected from new developments constructed in the City.
Recreation Impact Fees - This fund was established to account for recreation
Fund impact fees collected from new developments constructed
in the City.
Capital Projects Funds
Capital Projects Fund - This fund was established to account for the acquisition of
fixed assets or construction of major capital projects not
being financed by proprietary funds.
so
CITY OF EDGEWATER, FLORIDA
COMBINING BALANCE SHEET
NONMAJOR GOVERNMENTAL FUNDS
September 30, 2003
Special Revenue
Special Law Police Fire Recreation
Enforcement Impact Impact Impact
Trust Fees Fees Fees
Assets:
Cash and cash equivalents $ 23,652 $ 16,983 $ 183,256 $ 138,462
Total Assets $ 23,652 $ 16,983 $ 183,256 $ 138,462
Liabilities and Fund Balances:
Liabilities:
Accounts payable $ - $ - $ - $ 8,039
Total Liabilities - - - 8,039
Fund Balances:
Reserved - - - -
Unreserved 23,652 16,983 183,256 130,423
Total Fund Balances 23,652 16,983 183,256 130,423
Total Liabilities and Fund Balances $ 23,652 $ 16,983 $ 183,256 $ 138,462
.ol
Special
Revenue
Total
Capital
Projects
Total
Nonmajor
Governmental
Funds
$
362,353
$
1,277,238
$
1,639,591
$
362,353
$
1,277,238
$
1,639,591
$ 8,039 $ 20,226 $ 28,265
8,039 20,226 28,265
354,314 1,257,012 1,611,326
354,314 1,257,012 1,611,326
$ 362,353 $ 1,277,238 $ 1,639,591
61
CITY OF EDGEWATER, FLORIDA
COMBINING STATEMENT OF REVENUES,
EXPENDITURES AND CHANGES IN FUND BALANCES
NONMAJOR GOVERNMENTAL FUNDS
For The Year Ended September 30, 2003
62
Special Revenue
Special Law
Police
Fire
Recreation
Enforcement
Impact
Impact
Impact
Trust
Fees
Fees
Fees
Revenues:
Fines and forfeitures
$ 9,882
$ -
$ -
$ -
Impactfees /special assessments
-
43,589
79,367
100,875
Investment income
66
214
486
234
Total revenues
9,948
43,803
79,853
101,109
Expenditures:
Current:
Public safety
10,563
75,935
4,000
-
Culture and recreation
-
-
-
77,738
Capital outlay:
General government
-
-
-
-
Total expenditures
10,563
75,935
4,000
77,738
Net Change in Fund Balances
(615)
(32,132)
75,853
23,371
Fund Balances - Beginning
24,267
49,115
107,403
107,052
Fund Balances - Ending
$ 23,652
$ 16,983
$ 183,256
$ 130,423
62
Special
Revenue
Total
Nonmajor
Capital
Governmental
Total
Projects
Funds
$ 9,882
$ -
$ 9,882
223,831
-
223,831
1,000
25,128
26,128
234,713
25,128
259,841
90,498
-
90,498
77,738
-
77,738
-
409,383
409,383
168,236
409,383
577,619
66,477
(384,255)
(317,778)
287,837
1,641,267
1,929,104
$ 354,314
$ 1,257,012
$ 1,611,326
63
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CITY OF EDGEWATER, FLORIDA
SPECIAL LAW ENFORCEMENT TRUST SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
For The Year Ended September 30, 2003
64
Variance with
Budgeted Amounts
Final Budget -
Actual
Positive
Original
Final
Amounts
(Negative)
Revenues:
Fines and forfeitures
$ 12,950
$ 12,950
$ 9,882
$ (3,068)
Impact fees /special assessments
-
-
-
Investment income
170
170
66
(104)
Total revenues
13,120
13,120
9,948
(3,172)
Expenditures:
Current:
Public safety
13,447
13,447
10,563
2,884
Culture and recreation
-
-
-
-
Capital outlay:
-
-
-
-
General government
Total expenditures
13,447
13,447
10,563
2,884
Net Change in Fund Balance
(327)
(327)
(615)
(288)
Fund Balances - Beginning
29,162
29,162
24,267
(4,895)
Fund Balances - Ending
$ 28,835
$ 28,835
$ 23,652
$ (5,183)
64
CITY OF EDGEWATER, FLORIDA
POLICE IMPACT FEES SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES -BUDGET AND ACTUAL
For The Year Ended September 30, 2003
Budgeted Amounts
Actual
Original Final Amounts
Revenues:
Fines and forfeitures
Impact fees /special assessments
Investment income
Total revenues
Expenditures:
Current:
Public safety
Culture and recreation
Capital outlay:
General government
Total expenditures
Net Change in Fund Balance
Fund Balances - Beginning
Fund Balances - Ending
Variance with
Final Budget -
Positive
(Negative)
65
50,000
50,000
43,589
(6,411)
1,000
1,000
214
(786)
51,000
51,000
43,803
(7,197)
94,566
94,586
75,935
18,651
94,586
18,651
75,935
94,566
(43,566)
(43,586)
(32,132)
11,454
47,150
47,150
49,115
1,965
$ 3,584 $
3,564 $
16,983 $
13,419
65
CITY OF EDGEWATER, FLORIDA
FIRE IMPACT FEES SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
For The Year Ended September 30, 2003
..
Variance with
Budgeted Amounts
Final Budget -
Actual
Positive
Original
Final
Amounts
(Negative)
Revenues:
Fines and forfeitures
$ -
$ -
$ -
$ '
Impact fees /special assessments
90,000
90,000
79,367
(10,633)
Investment income
1,200
1,200
486
(714)
Total revenues
91,200
91,200
79,853
(11,347)
Expenditures:
Current:
Public safety
-
4,000
4,000
-
Culture and recreation
-
-
-
-
Capital outlay:
-
General government
-
-
-
'
Total expenditures
-
4,000
4
-
Net Change in Fund Balances
91,200
87,200
75,853
(11,347)
Fund Balances - Beginning
107,403
107,403
107,403
-
Fund Balances - Ending
$ 198,603
$ 194,603
$ 183,256
$ (11,347)
..
CITY OF EDGEWATER, FLORIDA
RECREATION IMPACT FEES SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES-BUDGET AND ACTUAL
For The Year Ended September 30, 2003
Budgeted Amounts
Original Final
Revenues:
Fines and forfeitures
Impact fees /special assessments
Investment income
Total revenues
Expenditures:
Current:
Public safety
Culture and recreation
Capital outlay:
General government
Total expenditures
Net Change in Fund Balances
Fund Balances - Beginning
Fund Balances - Ending
110,000 110,000
1,500 1,500
111,500 111,500
100,875 (9,125)
234 (1,266)
101,109 (10,391)
127,530
127,530
77,738
49,792
49,792
77,738
127,530
127,530
(16,030)
(16,030)
23,371
39,401
111,765
111,765
107,052
(4,713)
$ 95,735 $
95,735 $
130,423 $
34,688
Actual
Amounts
Variance with
Final Budget -
Positive
(Negative)
67
CITY OF EDGEWATER, FLORIDA
CAPITAL PROJECTS FUND
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
..r
For The Year Ended September 30, 2003
to
Variance with
Budgeted
Amounts
Final Budget -
Actual
Positive
Original
Final
Amounts
(Negative)
IN
Revenues:
Fines and forfeitures
$ -
$ -
$ -
$ '
Impact fees /special assessments
Investment income
33,000
33,000
25,128
(7,872)
Total revenues
33,000
33,000
25,128
(7,872)
Expenditures:
Current:
Public safety
-
-
-
-
Culture and recreation
-
-
Capital outlay:
-
-
-
General government
1,650,000
1,650,000
409,383
1,240,617
Total expenditures
1,650,000
1,650,000
409,383
1,240,617
Net Change in Fund Balances
(1,617,000)
(1,617,000)
(384,255)
1,232,745
Fund Balances - Beginning
1,650,000
1,650,000
1,641,267
(8,733)
Fund Balances - Ending
$ 33,000
$ 33,000
$ 1,257,012
$ 1,224,012
68
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NONMAJOR PROPRIETARY FUNDS
Enterprise Funds
Water and Sewer - This fund was established at October 1, 2002 with net
Development Fee Fund assets of the water and sewer fund that were reserved for
development. Water and sewer development fees
received each year are deposited into this fund to be used
primarily for capital improvements to the water and sewer
system.
Renewal and Replacement - This fund was established at October 1, 2002 with net
Fund assets of the water and sewer fund that were reserved for
renewal and replacement. Bond covenants require that
transfers be made to the renewal and replacement fund
equivalent to 5% of the gross revenues of the system for
the previous fiscal year.
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40
M
CITY OF EDGEWATER, FLORIDA
COMBINING STATEMENT OF NET ASSETS
NONMAJOR PROPRIETARY FUNDS
September 30, 2003
Assets
Noncurrent assets:
Restricted cash and cash equivalents
Total assets
Liabilities
Current liablities:
Accounts payable
Total liabilities
Net Assets
Restricted
Water and Sewer Renewal and Total Nonmajor
Development Replacement Proprietary
Fee Fund Fun Funds
$ 2,515,510 $ 1,016,778 $ 3,532,288
2,515,510 1,016,778 3,532,288
7,240 23,218 30,458
7,240 23,218 30,458
$ 2,508,270 $ 993,560 $ 3,501,830
.•
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CITY OF EDGEWATER, FLORIDA
COMBINING STATEMENT OF REVENUES, EXPENSES
AND CHANGES IN FUND NET ASSETS
NONMAJOR PROPRIETARY FUNDS
September 30, 2003
Water and Sewer Renewal and Total Nonmajor
Development Replacement Proprietary
Fee Fund Fund Funds
Operating Revenues
User Charges
Operating Expenses
Contractual services
Operating income(loss)
Nonoperating Revenue
Grant revenue
Investment income
Total nonoperating revenue
Income before contributions
and transfers
Capital contibutions:
Development fees
Transfers in
Transfers out
Change in net assets
Total Net Assets - Beginning
Total Net Assets - Ending
31,180 650 31,830
(31,180) (650) (31,830)
- 202,000 202,000
35,291 12,599 47,890
35,291 214,599 249,890
4,111 213,949 218,060
446,090 - 446,090
- 270,809 270,809
(154,100) (222,307) (376,407)
296,101 262,451 558,552
2,212,169 731,109 2,943,278
$ 2,508,270 $ 993,560 $ 3,501,830
70
CITY OF EDGEWATER, FLORIDA
COMBINING STATEMENT OF CASH FLOWS
NONMAJOR PROPRIETARY FUNDS
For The Year Ended September 30, 2003
Cash Flows from Operating Activities:
Water and Sewer Renewal and Total Nonmajor
Development Replacement Proprietary
Fee Fund Fund Funds
Receipts from customers $ - $ - $ -
Payments to suppliers (23,940) 22,568 (1,372)
Net cash provided (used) by operating
activities (23,940) 22,568 (1,372)
Cash Flows from Non - Capital
Financing Activities:
Net operating transfers in
Net operating transfers out
Net cash provided (used) by non - capital
financing activities
Cash Flows from Capital and Related
Financing Activities:
Grant received
Development fees received
Net cash provided by capital and
related financing activities
270,809 270,809
(154,100) (222,307) (376,407)
(154,100) 48,502 (105,598)
- 202,000 202,000
446,090 - 446,090
446,090 202,000 648,090
Cash Flows from Investing Activities:
Investment income
Net cash provided by investing activities
Net Increase in Cash and
Cash Equivalents
Cash and Cash Equivalents - Beginning
Cash and Cash Equivalents - End
35,291 12,599 47,890
35,291 12,599 47,890
303,341 285,669 589,010
2,212,169 731,109 2,943,278
$ 2,515,510 $ 1,016,778 $ 3,532,288
71
in
CM
i
to
Reconciliation of Operating Income
(Loss) to Net Cash Provided By
Operating Activities
Operating income (loss)
Change in Assets and Liabilities:
Increase in accounts payable
Total adjustments
Net Cash Provided(Used) by Operating
Activities
M
AN
ft
to
r
.0
Water and Sewer Renewal and Total Nonmajor
Development Replacement Proprietary
Fund Fund Funds
$ (31,180) $ (650) $ (31,830)
7,240 23,218 30,458
7,240 23,218 30,458
$ (23,940) $ 22,568 $ (1,372)
72
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O.
FIDUCIARY FUNDS
Pension Trust Funds
Police, Firefighter and - These funds are used to account for the accumulation of
General Employees' resources to be used for retirement annuity payments at
.. Pension Funds the appropriate amounts and times in the future.
Resources are contributed by employees at rates fixed by
law and by the City and the State at amounts determined
r , by an annual actuarial study.
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M
M
W
W
W
tr
IV
up
W
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qP
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yT,
CITY OF EDGEWATER, FLORIDA
COMBINING STATEMENT OF FIDUCIARY NET ASSETS
FIDUCIARY FUNDS
September 30, 2003
r
General Police Totals
Employees Officers Firefighters Employee
Pension Trust Pension Trust Pension Trust Pension Funds
r Assets:
Cash and short-term investments $ - $ 94,335 $ 118,033 $ 212,368
Investments, at fair value:
Debt mutual funds
Equity mutual funds
Other mutual funds
Total investments
r
Total assets
Liabilities:
Accounts payable
Net Assets Held in Trust for
Pension Benefits
w
4,355,616
2,905,898
633,594
7,895,108
4,605,098
1,345,074
1,016,574
6,966,746
707,352
580,573
-
1,287,925
9,668,066
4,831,545
1,650,168
16,149,779
9,668,066
4,925,880
1,768,201
16,362,147
1,034
-
-
1,034
$ 9,667,032 $ 4,925,880 $ 1,768,201 $ 16,361,113
73
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LI
M CITY OF EDGEWATER, FLORIDA
COMBINING STATEMENT OF CHANGES IN FIDUCIARY NET ASSETS
FIDUCIARY FUNDS
For The Year Ended September 30, 2003
'o
General
Police
- (23,877)
Total
(34,992)
Employees
Officers
Firefighters
Employee
Pension Trust
Pensio Trust
Pensio Trust
Pe n s ion Funds
to
Additions:
Contributions:
so Employer
$ 436,006
$ 410,431
$ 146,735
$ 993,172
Plan members
65,797
84,547
57,210
207,554
State
-
94,334
62,788
157,122
Total contributions
501,803
589,312
266,733
1,357,848
Investments income:
Net increase in fair value
Less investment expense
Net investment income
Total additions
Deductions:
Benefits /distributions
Administrative expenses
Total deductions
Change in Net Assets
Net Assets Held in Trust for
Pension Benefits :
Beginning of Year
End of Year
1,015,990 453,787
159,658
1,629,435
- (23,877)
(11,115)
(34,992)
1,015,990 429,910
148,543
1,594,443
1,517,793 1,019,222
415,276
2,952,291
191,845
114,187
24,354
10,401
216,199
124,588
$ 4,925,880
1,301,594
894,634
19,943
325,975
9,438
44,193
29,381
370,168
$ 4,925,880
385,895
2,582,123
8,365,438
4,031,246
1,382,306
13,778,990
$ 9,667,032
$ 4,925,880
$ 1,768,201
$ 16,361,113
74
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1 7
CAPITAL ASSETS USED IN THE
OPERATION OF GOVERNMENTAL FUNDS
f�
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CITY OF EDGEWATER, FLORIDA
CAPITAL ASSETS USED IN THE OPERATION OF GOVERNMENTAL FUNDS
SCHEDULE BY FUNCTION AND ACTIVITY
an
to
IN
For The Year Ended September 30, 2003
75
General
Public
Public
Leisure
Government
Safety
Works
Services
Total
Land
$ 1,934,540
$ 105,591
$ 6,906
$ 1,732,399
$ 3,779,436
Buildings
175,818
1,225,060
58,268
2,911,718
4,370,864
Improvements
74,943
25,905
12,762,624
1,579,763
14,443,235
Machinery & equipment
328,345
2,229,807
294,468'
556,315
3,408,935
Infrastructure
-
-
625,460
-
625,460
Construction in
progress
-
-
597,819
285,316
883,135
Total
$ 2,513,646
$ 3,586,363
$14,345,545
$ 7,065,511
$ 27,511,065
Deletions
Balance
and
Balance
09 -30 -02
Additions
Transfers
09 -30 -03
General Government
$ 585,833
$ 1,937,313
$ 9,500
$ 2,513,646
Public Safety
3,507,457
132,277
53,371
3,586,363
Public Works
18,401,332
1,227,777
5,283,564
14,345,545
Leisure Services
6,706,944
626,183
267,616
7,065,511
Total
$ 29,201,566
$ 3,923,550
$ 5,614,051
$ 27,511,065
75
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STATISTICAL SECTION
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61
STATISTICAL INFORMATION
Comments Relative to Statistical Section
The following statistical tables that are recommended for inclusion by the Government Finance
Officers Association are not included for the reasons stated below:
A. Ration of Net General bonded Debt to Assessed Value and Net Bonded Debt per
Capita - Last Ten Fiscal Years - The City has not had any general bonded debt over
�.. the past ten fiscal years.
B. Ratio of Annual Debt Service for General bonded Debt to Total General Expenditures -
Last Ten Fiscal Years - The City has not had any general bonded debt over the past
ten fiscal years.
C. Florida Statutes and the Charter of the City of Edgewater, Florida, set no legal debt
margin.
CITY OF EDGEWATER, FLORIDA
GENERAL GOVERNMENTAL EXPENDITURES
BY FUNCTION (1)
Last Ten Fiscal Years
Fiscal Year
General
Ended
Total
Government
Public Safety
Transportation
1994
$ 5,536,175
$1,374,732
$2,618,319
$539,395
1995
5,965,527
1,475,527
2,774,643
484,726
1996
12,357,998
1,496,667
2,762,925
429,734
1997
11,563,627
1,578,623
2,979,253
400,222
1998
7,177,744
1,871,415
3,012,478
328,927
1999
7,720,056
1,194,392
3,283,992
301,660
2000
10,163,707
1,423,439
4,164,037
667,425
2001
10,508,931
1,633,024
4,395,867
949,445
2002
15,749,026
2,133,671
5,362,820
986,671
2003
11,212,699
2,033,442
5,308,937
359,916
(1) Includes General, Special Revenue, Capital Projects and Debt Service Funds.
76
Leisure
Capital
Debt
Services
Outlay
Service
$559,520
$ 402,505
$ 41,704
599,877
557,493
73,261
623,604
6,054,969
990,099
590,121
5,061,279
954,129
601,396
414,808
944,559
616,686
1,375,499
943,649
728,209
2,241,616
938,981
925,987
1,665,678
936,940
1,335,748
4,967,147
962,969
1,609,971
409,383
1,491,050
77
CITY OF EDGEWATER, FLORIDA
GENERAL GOVERNMENTAL REVENUES
BY SOURCE (1)
Last Ten Fiscal Years
(1) Includes General, Special Revenue, Capital Projects and Debt Service Funds.
78
Licenses
Fiscal Year
and
InterGovernmental
Ended
Total
Taxes
Permits
Revenues
1994
$5,507,841
$4,333,768
$169,855
$ 580,153
1995
6,830,328
4,386,811
160,758
549,529
1996
7,547,035
5,016,151
181,459
574,174
1997
7,293,444
5,147,962
179,136
688,286
1998
7,468,670
5,484,239
185,503
667,988
1999
7,672,589
5,516,973
220,890
806,787
2000
7,718,669
5,648,694
267,252
663,079
2001
9,117,174
6,189,561
297,863
1,382,955
2002
9,152,993
5,130,474
326,793
2,566,811
2003
9,876,614
5,959,123
445,741
2,221,416
(1) Includes General, Special Revenue, Capital Projects and Debt Service Funds.
78
Charges for
Fines and
Investment
Special
Miscellaneous
Services
Forfeitures
Income
Assessments
Revenue
$ 195,180
$108,739
$ -
$ -
$120,146
1,380,438
96,340
-
-
256,452
146,434
97,328
813,149
298,767
419,573
111,478
83,247
547,977
288,851
246,507
123,692
75,309
24,910
609,286
297,743
141,439
91,658
27,973
595,790
271,079
139,931
77,659
39,121
577,464
305,469
205,982
115,608
36,420
598,314
290,471
57,137
77,508
293,050
577,998
123,222
112,985
193,962
254,253
644,420
44,714
79
CITY OF EDGEWATER, FLORIDA
PROPERTY TAX LEVIES AND COLLECTIONS
Last Ten Fiscal Years (1)
Fiscal
Total
Total Tax
Percent of Levy
Year Ended
Tax Levy
Collections
Collected
1994
$2,073,547
$2,010,161
96.94%
1995
2,113,146
2,040,928
96.58
1996
2,608,024
2,516,081
96.47
1997
2,528,985
2,440,210
96.49
1998
2,576,393
2,491,303
96.70
1999
2,538,138
2,443,445
96.27
2000
2,463,013
2,376,413
96.48
2001
2,647,837
2,599,328
98.17
2002
2,794,043
2,704,707
96.80
2003
3,516,953
3,388,208
96.34
(1) Each fiscal year contains data from the ad valorem assessment roll of the preceding year
(i.e., fiscal year 2002 contains the 2001 assessment roll tax collections).
(1) Obtained from the Revised Recapitulation of the Ad Valorem Assessment Rolls of
Edgewater, Florida provided by Volusia County, Florida Finance Department.
(2) Each fiscal year contains the ad valorem assessment roll of the preceding year (i.e., fiscal
year 2002, contains data on the 2001 assessment roll).
(3) Assessed taxable values for all fiscal years presented are stated net of the constitutional
homestead exemption of $25,000 and the additional senior homestead exemption of
$25,000.
81
'
CITY OF EDGEWATER, FLORIDA
ASSESSED AND ESTIMATED ACTUAL
VALUE
OF TAXABLE PROPERTY (1)
Last Ten Fiscal Years (1)
(In Thousands)
Ratio of Total
Ratio of Total
Assessed to
Assessed
"
(2)
Total
(3)
Taxable Value
Fiscal Year
Assessed
Estimated Estimated
Assessed
to Estimated
Ended
Value
Actual Value Actual Value
Taxable Value
Actual Value
1994
$484,289
$484,289 100.00%
$352,153
72.72%
F
1995
499,443
499,443 100.00
361,840
72.45
1996
516,875
516,875 100.00
367,272
71.06
1997
542,399
542,399 100.00
383,761
70.75
1998
561,103
561,103 100.00
400,061
71.29
1999
572,804
572,804 100.00
403,519
70.44
2000
589,101
589,101 100.00
413,951
70.26
r
2001
632,205
632,205 100.00
445,014
70.39
2002
694,658
694,658 100.00
469,587
67.59
2003
842,981
842,981 100.00
539,238
63.97
(1) Obtained from the Revised Recapitulation of the Ad Valorem Assessment Rolls of
Edgewater, Florida provided by Volusia County, Florida Finance Department.
(2) Each fiscal year contains the ad valorem assessment roll of the preceding year (i.e., fiscal
year 2002, contains data on the 2001 assessment roll).
(3) Assessed taxable values for all fiscal years presented are stated net of the constitutional
homestead exemption of $25,000 and the additional senior homestead exemption of
$25,000.
81
CITY OF EDGEWATER, FLORIDA
PROPERTY TAX RATES - ALL DIRECT
AND OVERLAPPING GOVERNMENTS
Last Ten Fiscal Years (1)
Tax rates per $1,000 of assessed taxable values
82
SouHieast
Florida
St Johns
Edgwrater
Volusia
Inletand
Inland
Water
Fiscal Year
General
School
Volusia
Hospital
Mosquito
Port
Navigabon
Management
Ended
Fund
District
ou
District
Control
Audio*
District
District
Trial
1994
5.888
9.869
5.627
2.332
0.318
0.094
0.051
0.470
24.649
1995
5.840
10.277
5.716
2.292
0.287
0.094
0.049
0.482
25.037
1996
7.101
10.887
6.172
2.285
0.262
0.094
0.040
0.482
27.323
1997
6.590
10.821
6.217
2.247
0.238
0.093
0.038
0.482
26.726
1998
6.440
10.487
6.381
2.132
0.238
0.090
0.050
0.482
26.300
1999
6.290
10.376
6.378
2.052
0.238
0.090
0.047
0.482
25.953
2000
5.950
9.158
6.367
2.528
0.238
0.090
0.041
0.472
24.844
2001
5.950
9.158
6.367
2.528
0.238
0.090
0.041
0.472
24.844
2002
5.950
8.899
6.604
2.320
0.238
0.090
0.0385
0.462
24.602
2003
6.95
8.699
6.604
2.320
0.238
0.090
0.0385
0.462
25.402
Tax rates per $1,000 of assessed taxable values
82
CITY OF EDGEWATER, FLORIDA
SPECIAL ASSESSMENTS COLLECTIONS
Last Ten Fiscal Years
Water and Sewer
Fund Since Levy
Road Improvement Assessments
Y
Current
Current
Current
Current
Fiscal
Assessments
Assessments
Assessments
Assessments
Year Ended
Due
Collected
Due
Collected
1994
$453,668
$766,062
$ -
$ -
1995
473,499
586,927
771,418
1,366,243
1996
529,579
608,631
238,813
298,767
1997
554,850
644,377
251,480
288,851
1998
580,364
624,088
265,575
293,139
1999
608,750
655,258
281,544
299,546
2000
638,209
684,687
297,401
310,973
2001
670,901
762,235
315,347
341,279
2002
731,162
823,170
352,167
383,260
2003
762,155
834,005
369,351
399,888
83
CITY OF EDGEWATER, FLORIDA
COMPUTATION OF OVERLAPPING DEBT
September 30, 2003
Percentage City of
Applicable to Edgewater w
Net Debt the City of Share of
Overlapping Governments Outstandinq Edgewater Debt
Volusia County School District $37,460,455 2.76 $1,033,909
Total overlapping debt $1,033,909
(1) Data provided by above agencies.
(2) The City does not have any general obligation long -term debt outstanding.
84
CITY OF EDGEWATER, FLORIDA
DEMOGRAPHIC STATISTICS
Last Ten Fiscal Years
w
' (1) Obtained from University of Florida, Bureau of Economics and Business Research.
Census Bureau estimate for April 2000 and City of Edgewater Planning Dept.
(2) Obtained from Volusia County Supervisor of Elections.
(3) Obtained from U.S. Department of Commerce, Bureau of Economic Analysis.
(4) State of Florida, Department of Labor and . Employment Security.
y
(5) Volusia County School Board - includes grades K -5, Edgewater Elementary School and
Indian River Elementary School.
(6) Volusia County - Census Bureau (2000)
I
85
(1)
(2)
(3) Per
(4) County
(5) School
(6)
Fiscal
Estimated
Registered
Capita
Unemployment
Percent
Median
Year
Population
Voters
Income
Rate
Enrollment
Attendance
Age
1994
17,096
9,024
$16,526
6.4%
1,540
95
-
w
1995
17,484
10,942
18,730
4.9
1,534
95
-
1996
17,820
11,158
18,815
4.2
1,524
95
-
1997
18,077
11,196
19,455
4.0
1,546
95
-
1998
18,761
11,821
19,787
3.2
1,495
96
-
1999
18,865
11,786
20,309
3.0
1,484
95
46.7
2000
19,343
12,839
21,920
2.9
1,491
95
-
2001
19,390
12,484
22,520
4.0
1,457
95
2002
19,515
12,406
23,195
5.3
1,603
93
-
2002
19,515
12,406
23,195
5.3
1,603
93
-
2003
20,088
12,753
23,832
5.2
1,412
95
42.2
w
' (1) Obtained from University of Florida, Bureau of Economics and Business Research.
Census Bureau estimate for April 2000 and City of Edgewater Planning Dept.
(2) Obtained from Volusia County Supervisor of Elections.
(3) Obtained from U.S. Department of Commerce, Bureau of Economic Analysis.
(4) State of Florida, Department of Labor and . Employment Security.
y
(5) Volusia County School Board - includes grades K -5, Edgewater Elementary School and
Indian River Elementary School.
(6) Volusia County - Census Bureau (2000)
I
85
(1) Provided by Florida Bankers Association.
(2) Obtained from revised recapitulation of the ad valorem assessment rolls of the City of
Edgewater.
i
CITY
OF EDGEWATER,
FLORIDA
PROPERTY VALUE,
CONSTRUCTION
AND BANK DEPOSITS
Last Ten Fiscal Years
(In Thousands)
(1)
(2)
Commercial
Residential
(1)
Assessed
Fiscal
Construction
Co
Deposits
Savings
Value
Year
Units
Value
Units Value
Banks
and Loan
1994
5
$900
126 $8,015
$88,750
$91,544
$484,289
1995
8
1,987
70 5,799
93,927
95,542
499,443
1996
13
2,379
124 10,068
96,342
87,419
516,875
1997
20
2,224
105 7,626
190,381
-
542,399
1998
35
2,465
116 9,944
209,575
-
561,103
1999
11
1,755
201 15,834
201,653
-
572,804
2000
23
6,743
195 19,077
201,494
-
589,101
2001
9
1,159
285 28,892
206,981
-
632,205
2002
17
3,953
226 23,495
206,960
-
694,658
2003
17
4,052
281 29,628
215,130
-
842,981
(1) Provided by Florida Bankers Association.
(2) Obtained from revised recapitulation of the ad valorem assessment rolls of the City of
Edgewater.
i
CITY OF EDGEWATER, FLORIDA
SUMMARY OF TEN LARGEST
SINGLE UNIT WATER USERS
' September 30, 2003
(3) Water restrictions implemented by the St. Johns River Water Management District,
Volusia County, and the City of Edgewater continue to be in effect. Reclaimed water has
been available to the Florida Shores area since 1994. A total of 2,599 customers were
connected to the reclaimed /reuse water system at year end.
5
ib
87
Average
Consumption
Percent of
Per Month
Total Gallons
Customers
(Gallons) (1)
Consumed
County of Volusia
6,565,660
12.65%
Eastern Shores Mobile Village
755,725
1.46
Coronado Paint Company
377,148
.73
Halifax Court (Hendry)
140,303
.27
Volusia County Schools
136,391
.26
Blue Gables, Inc.(Naco, Inc.)
113,667
.22
Pyramid Park
97,358
.19
Friendly Shores HOA
105,760
.20
Publix Supermarket, Inc.
79,750
.15
Winn Dixie
56,542
.11
8,428,304
16.24%
FY -2003 average monthly consumption: 51,899,558 gallons
(1) Based on individual meter connections per City
of Edgewater, Florida,
records.
(2) The total average monthly consumption for the
ten largest water users decreased from
the previous year by a total of 161,000 gallons.
(3) Water restrictions implemented by the St. Johns River Water Management District,
Volusia County, and the City of Edgewater continue to be in effect. Reclaimed water has
been available to the Florida Shores area since 1994. A total of 2,599 customers were
connected to the reclaimed /reuse water system at year end.
5
ib
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CITY OF EDGEWATER, FLORIDA
PRINCIPAL TAXPAYERS
September 30, 2003
Source: 2002 ad valorem tax rolls of the City of Edgewater, Florida. DR -403AM
FY -2003 total assessed valuation $ 842,981,339.
Percent of
Assessed
Total Assessed
Customers
Valuation
Valuation
Florida Power & Light
$ 10,813,423
1.28%
Coronado Paint Company, Inc.
6,544,190
.78
BellSouth Communications, Inc.
3,465,163
.41
Edgewater Commons
3,313,639
.39
Laramie Florida Shores, LP
2,866,831
.34
Twean Subsidiary, LLC
2,698,480
.32
Sea Edge Partners, LLC
2,655,698
.32
Bel Aire Investments, Inc.
2,397,000
.28
Carder, James and Rosemary
2,062,301
.24
Florida East Coast Railway Company
1,805,325
.21
$38.6 2 050
4.57
Source: 2002 ad valorem tax rolls of the City of Edgewater, Florida. DR -403AM
FY -2003 total assessed valuation $ 842,981,339.
CITY OF EDGEWATER, FLORIDA
MISCELLANEOUS STATISTICAL DATA
I September 30, 2003
4
The City of Edgewater lies just south of New Smyrna Beach, along the Atlantic coastline.
Beginning as the small village of Hawk's Park with 115 permanent residents in 1871, the name
was formally changed to Edgewater in 1925. The apiaries of the early days evolved into a large
honey company which exports internationally. A large paint factory, a thriving building industry,
boat building, garment factories and other light manufacturing provide employment. A friendly
city with a small town flavor, Edgewater has a wide variety of residential options.
City Operations:
Police Department:
Sworn Officers
Civilian Employees
Reserve Officers
Source: City of Edgewater Finance Department
7
35
5
2
Class 5/9
2
21
8
4
1
1
84 Passive
67 Active
151
14
1
1
89
Fire Department:
Insurance rating
Number of stations
Full -time firefighters
Volunteer firefighters
Civilian employees
Animal Control
Reserves
City Parks (Active and Open Space)
Park acreage
Community Facilities
Nearest Commercial Airport:
Daytona Beach International
Financial Institutions
Churches
Libraries
Post office locations
Electric Service:
Florida Power & Light
Telephone Service:
Bell South
Cable TV Service:
Time Warner Communications, Inc.
Source: City of Edgewater Finance Department
7
35
5
2
Class 5/9
2
21
8
4
1
1
84 Passive
67 Active
151
14
1
1
89
CITY OF EDGEWATER, FLORIDA
MISCELLANEOUS STATISTICAL DATA - CONTINUED
September 30, 2003
Garbage/Trash Collection:
Type:
Residential service
Commercial /Industrial service
Recycling
Water Service:
Source
Plant capacity
Average daily demand
Treatment
Monthly Residential and Commercial Rates
Sewer Service:
System Type:
Average Daily Flow
Plant Capacity
Avg. Capacity Used Daily
Avg. Daily Reclaimed Water
Consumption
Minimum
Additional 1,000 gallons
Stormwater Management Fee
Per Equivalent Drainage Unit (EDU)
Without site mitigation
With site mitigation
Pickups /wk 1/1/03
2 $15.50
2 $18.30
1 $1.50
Florida Upper Aquifer
5.0 mgd
1.706 mgd
Lime softening
Effective 10/1/94
Advanced Wastewater Treatment
1.120 mgd
2.750 mgd
36.4%
1.021 mgd
Relcaimed
Water Sewer Water
$8.00 $9.55 $5.00
$1.25 -3.90 $3.18
Effective 10/1/94
$6.00
$2.92
99
CITY OF EDGEWATER, FLORIDA
WATER AND SEWER REVENUE BOND COVERAGE
(1) Required coverage is 1.00
(2) Required coverage is 1.15
(3) Excludes interest earned on construction and impact fee funds
(4) Includes cumulative collection of assessment principal and interest less amounts used for debt
service payments less collections recognized as revenue in current year
91
September 30, 2003
Operating
Payments to
Net (4) Total
Revenues Pledged Funds
(1)
and
Renewal &
Available Special Available
Total Bond
Bond
Fiscal Gross Maintenance
Replacement
for All Assessment for All
Service
Service
Year Revenues Expenses
Funds
Bonds Funds Bonds
Requirement Coverage
2003 $5,108,991 $3,300,405
$270,809
$1,537,777 $1,700,946 $3,238,723
$2,879,765
1.12
2002 4,898,298 3,047,196
276,222
1,574,879 1,600,311 3,175,190
2,879,701
1.10
2001 4,949,424 2,901,684
278,780
1,768,960 1,332,986 3,101,946
2,878,250
1.08
2000 4,984,683 2,593,721
267,969
2,122,993 1,305,116 3,428,109
2,878,463
1.19
1999 4,713,972 2,468,742
261,066
1,984,164 1,329,440 3,313,604
2,881,456
1.15
tIr
Total Funds
Total Bond
(2)
Fiscal Available
Allowable
Service
Bond Service
Year for All Bonds
Impact Fees
Total Requirement
Coverage
2003 $3,238,723
$503,182
$3,741,905 $2,879,765
1.30
2002 3,175,190
503,152
3,678,342 2,879,701
1.28
2001 3,101,946
502,468.
3,604,414 2,878,250
1.25
2000 3,428,109
502,569
3,930,678 2,878,463
1.37
1999 3,313,604
503,978
3,817,582 2,881,456
1.32
4
Fiscal year 2003 calculations:
Gross revenues:
Operating revenues
$4,808,221
Connection fees
186,772
Interest revenues (3)
113,998
$5,108,991
Operation and maintenance expenses:
Depreciation
$4,868,788
Total operating expenses
1,568,383
$3,300,405
Allowable impact fees:
Bond service requirement
$1,068,328
Impact fee percentage
47.1%
$503,182
Bond service requirements:
Sr. Lien Jr. Lien
Total
Principal
$ 405,000 $ 1,187,004 $ 1,592,004
Interest
663,328 624,433 1,287,761
_$_1,068,328 $ 1,811,437 $ 2,879,765
(1) Required coverage is 1.00
(2) Required coverage is 1.15
(3) Excludes interest earned on construction and impact fee funds
(4) Includes cumulative collection of assessment principal and interest less amounts used for debt
service payments less collections recognized as revenue in current year
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OTHER REPORTS
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f�
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V A MCDIRA41T DAM UCKETT'
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL
REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED
IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
The Honorable Mayor and
City Commission
City of Edgewater, Florida
We have audited the basic financial statements of the City of Edgewater, Florida, as of and for the
year ended September 30, 2003, and have issued our report thereon dated January 27, 2004.
We conducted our audit in accordance with auditing standards generally accepted in the United
States of America and the standards applicable to financial audits contained in Government
Auditing Standards, issued by the Comptroller General of the United States.
Compliance - As part of obtaining reasonable assurance about whether the City of Edgewater,
Florida's basic financial statements are free of material misstatement, we performed tests of its
compliance with certain provisions of laws, regulations, contracts and grants, noncompliance with
which could have a direct and material effect on the determination of financial statement amounts.
However, providing an opinion on compliance with those provisions was not an objective of our
audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no
instances of noncompliance that are required to be reported under Government Auditing
!r Standards. However, we noted certain immaterial instances of noncompliance that we have
reported to management of the City of Edgewater, Florida in a separate letter dated January 27,
2004.
Internal Control Over Financial Reporting - In planning and performing our audit, we
considered the City of Edgewater, Florida's internal control over financial reporting in order to
determine our auditing procedures for the purpose of expressing our opinion on the basic financial
statements and not to provide assurance on the internal control over financial reporting. Our
consideration of the internal control over financial reporting would not necessarily disclose all
matters in the internal control over financial reporting that might be material weaknesses. A
material weakness is a condition in which the design or operation of one or more of the internal
control components does not reduce to a relatively low level the risk that misstatements in
amounts that would be material in relation to the basic financial statements being audited may
occur and not be detected within a timely period by employees in the normal course of performing
their assigned functions. We noted no matters involving the internal control over financial reporting
and its operation that we consider to be material weaknesses. However, we noted other matters
involving the internal control over financial reporting that we have reported to management of the
City of Edgewater, Florida in a separate letter dated January 27, 2004.
MCDIrzMIT D AVIS i UCU r 4z COMPANY, LLC
CER -1 1 . 1PIED PUP,LIC ACCOUNTANTS AND ADVISORS
605 E. ROBINSON STREET, SUITE 635 ° ORLANDO, FLORIDA 32801
TELEPHONE 407 - 843 - 5406 ° FAX 407. 649 -9339 A EMAIL: INFO(_(1 MDPCPA.COM
MEMIII.RS: PRIVATE COMPANIES PRACTIC'F SECTION -A KIER ICA\ INSTITIITF OF CFRTIFIF.D PUBLIC ACCnLINTANTS • FI_nR I DA 1 \ITITUTF OF CF'RTIFIFD PURI.IC Af!'OL`�TANTS
' 92
1
This report is intended solely for the information and use of management, the City Commission
and the Auditor General of the State of Florida and is not intended to be, and should not be used
by anyone other than these specified parties.
January 27, 2004
t
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MANAGEMENT LETTER
This page intentionally left blank.
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lI
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1
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1
F 'Affl,� , A C I)IRI!✓ n" DAVIS PUCIUTT
MANAGEMENT LETTER
Honorable Mayor and City Commission
City of Edgewater, Florida
In planning and performing our audit of the financial statements of the City of Edgewater, Florida for
the year ended September 30, 2003, we considered its internal control to determine our auditing
procedures for the purpose of expressing our opinion on the financial statements and not to provide
assurance on internal control. The following findings and recommendations, which resulted from our
consideration of internal control, are submitted to assist in improving procedures and controls. In
addition, this report includes other disclosures required by Rules of the Auditor General, State of
Florida.
We conducted our audit in accordance with auditing standards generally accepted in the United
States of America and the standards applicable to financial audits contained in Government Auditing
Standards issued by the Comptroller General of the United States. We have issued our Report on
Compliance and Internal Control over Financial reporting and disclosures in this report, which is dated
January 27, 2004, should be considered in conjunction with this management letter.
This management letter is intended solely for the information of the City of Edgewater, Florida and
management, and the State of Florida Office of the Auditor General and is not intended to be and
should not be used by anyone other than those specified parties.
�G
U
January 27, 2004
MCDIRMIT DAVIS PUCKETT & COMPANTY, LLB`
C ERTIFI ED I'URLI'C ACCOUNTANTS AND ADVISORS
605 E. ROFSINSOnI STREET, SUITE 635 ^ ORLANDO, FLORIDA 32801
TELEPHONE 407- 843 -5406 • FAx 407 - 649 -9339 - EMAIL: INFO @?,MDPCPA.COM
MEMHI RS: PR I�ATF COMPANIES PRACTICE SFCTION -A MF.R K A\ INSTITI;TF: OF CERTIFIED Pum.IC ACCOUNT NNTS ° F1 OR IOA 1\'STITUTI: OF CERTIIIED PL'II11. IC ACC'.OI;NTANTS
94
P
Management Comments
City of Edgewater, Florida
January 27, 2004
Page Two
• • - :- *T1 R1 UOTI
The City continued to have some unfavorable ratios when the Auditor General
financial condition assessment procedures were applied. The City's ratio of
unreserved general fund balance to operating expenditures of the general fund for
2002 is less than 7 %. In addition, the City's general fund cash and investments
balances in relation to expenditures also continues to be low. We did note that
there was an excess of revenues over expenditures of $32,060 in the General
Fund for 2002 compared to large deficits of revenues over expenditures in the past
two prior years. This is a favorable trend that the City should continue. The City
Commission did increase the property tax millage rate for fiscal year ending
September 30, 2003, which should have a favorable impact on the financial
condition of the City.
We recommend the City set some goals to increase the ratio of unreserved
general fund balance to general fund operating expenditures to at least 10 -20 %.
By doing this the other ratio of cash to expenditures will automatically increase.
For the second year in a row, the City had a small excess of revenues over
expenditures in the general fund. However, this excess was considerably less than
budgeted and several of the Auditor General financial condition assessment ratios
were still unfavorable compared to benchmark, therefore we continue to
recommend the City increase ratio of unreserved general fund balance to general
fund operating expenditures.
1 - �• - - �- -� - :•l• • - •
The City is in compliance with the water and
but as noted in prior year comments, this
years. Actually, there was a slight increa
Waterway Park special assessments being
probably go back down in 2003 since
assessments will be collected over ten years.
sewer bond coverage requirements,
coverage has decreased from prior
se coverage in 2002 due to some
paid in full. However, coverage will
remaining Waterway Park special
95
Management Comments
City of Edgewater, Florida
January 27, 2004
Page Three
Recommendation
L
Since the City issued subordinate water and sewer debt in 2002, their debt
I service requirements will increase in 2003. We recommend the City monitor the
L , coverage ratios including the new debt to ensure continued compliance with
covenants.
There was a slight increase in coverage in 2003. Also, the rate study completed
in 2003 resulted in a rate increase in wastewater, which will provide additional
revenue in the future. Therefore, we have no further recommendation.
3. Investment Policy
The City's investment policy was revised in 2002 to comply with Section 218.415,
Florida Statutes, however, the City did not meet the continuing education
requirements until after September 30, 2002.
71
We recommend the City make sure they get at least 8 hours per year of continuing
education.
The continuing education requirements were met during 2003 and no further
comment is needed.
4. Excess Expenditures Over Appropriations
Actual expenditures exceeded appropriations in the following funds: Special Law
Enforcement Trust Special Revenue Fund, $789; Recreation Impact Fees Special
Revenue Fund, $4065; and the Capital Projects Fund $4,967,147. All of the above
funds had revenue and funds available to cover the expenditures.
Recommendation
t We recommend the City amend the budget during the year so that expenditures
do not exceed appropriations.
Corrective Action
There are no funds with expenditures in excess of appropriations during 2003.
t
1 96
Management Comments January 27, 2004
City of Edgewater, Florida . Page Four
1. Financial Condition Assessment
The City continues to have some unfavorable ratios when compared to
benchmarks for the Auditor General financial conditions assessment procedures.
For example, the City's ratio of unreserved general fund balance to operating
expenditures of the general fund for 2003 is 7.9 %. This percentage is low
compared to other cities the size of Edgewater. However, this is the second year
in a row that Edgewater had a small excess of revenue over expenditures, which is
a favorable trend which the City should continue.
Corrective Action
We continue to recommend the City set some oals to increase the ration f
9 0
unreserved general fund balance to general fund operating expenditures to at least
10 -20 %.
C. Comments Rpqi jr PH by the Ri iI s of the Auditor General
1. The financial report filed with the Department of Banking and Finance pursuant to
Section 218.32(1)(b), Florida Statutes, is in agreement in all material respects with
the annual financial audit report for the same period.
2. The City is not, or during the fiscal year was not, in a state of financial emergency
as a consequence of conditions described in Section 218.503(1) Florida Statutes.
3. The City of Edgewater, Florida, has complied with Section 218.415, Florida
Statutes, regarding the investment of public funds, except as note above.
4. As required by the Rules of the Auditor General Section 10.554(g)(6)c and
10.556(8), we applied financial condition assessment procedures.
97