FY 2013 CAFR el I I V Or Ebel ,
COMPREHENSIVE ANNUAL FINANCIAL REPORT
Fiscal Year Ended September 30, 2013
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COMPREHENSIVE ANNUAL FINANCIAL REPORT
For the fiscal year ended September 30, 2013
Prepared by: The Finance Department
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TABLE OF CONTENTS
Page
Introductory Section
Letter of Transmittal Ill
GFOA Certificate of Achievement VII
List of Principal Officials VIII
Organizational Chart IX
Financial Section
Independent Auditor's Report 1
Management's Discussion and Analysis 3
Basic Financial Statements
Government-Wide Financial Statements:
Statement of Net Position 15
Statement of Activities 16
Fund Financial Statements:
Balance Sheet-Governmental Funds 18
Reconciliation of the Balance Sheet of Government Funds to the Statement of
Net Position 19
Statement of Revenues, Expenditures and Changes in
Fund Balances-Governmental Funds 20
Reconciliation of the Statement of Revenues, Expenditures and
Changes in Fund Balances of Governmental Funds to the Statement of
Activities 21
Statement of Revenues, Expenditures and Changes in Fund
Balances-Budget and Actual-General Fund 22
Statement of Net Position-Proprietary Funds 23
Statement of Revenues, Expenses and Changes in
Fund Net Position-Proprietary Funds 24
Statement of Cash Flows-Proprietary Funds 25
Statement of Fiduciary Net Position-Fiduciary Funds 26
Statement of Changes in Fiduciary Net Position—Pension Trust Funds 27
Notes to Financial Statements 29
Required Supplementary Information (Unaudited) 58
Combining and Individual Fund Statements and Schedules
Nonmajor Governmental Funds—Fund Descriptions 61
Combining Balance Sheet-Nonmajor Governmental Funds 62
Combining Statement of Revenues, Expenditures and Changes
In Fund Balances -Nonmajor Governmental Funds 64
Schedule of Revenues, Expenditures and Changes in Fund
Balances- Budget and Actual—Nonmajor Special Revenue Funds 66
Schedule of Revenues, Expenditures and Changes in Fund
Balances-Budget and Actual—Nonmajor Debt Service Funds 70
Schedule of Revenues, Expenditures and Changes in Fund
Balances-Budget and Actual—Nonmajor Capital Projects Funds 71
Internal Service Funds—Fund Descriptions 73
Combining Statement of Net Position 74
Combining Statement of Revenues, Expenses, and Changes in Fund
Net Position—Internal Service Funds 75
Combining Statement of Cash Flows—Internal Service Funds 76
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Financial Section-Continued
Other Supplemental Scheduled—Fiduciary Funds—Fund Descriptions 77
Combining Statement of Fiduciary Net Position—Pension Trust Funds 78
Combining Statement of Changes in Fiduciary Net Position—Pension
Trust Funds 79
Statistical Section (Unaudited)
Table of Contents 81
Financial Trends
Net Position by Component 82
Changes in Net Position 83
Fund Balances of Governmental Funds 85
Changes in Fund Balances of Governmental Funds 86
Revenue Capacity:
Tax Revenues by Source of Governmental Funds 87
Assessed Value and Actual Value of Taxable Property 88
Property Tax Rates-Direct and Overlapping Governments 89
Principal Taxpayers 90
Property Tax Levies and Collections 91
Debt Capacity:
Ratios of Outstanding Debt by Type 92
Ratios of General Obligation Bonded Debt Outstanding 94
Direct and Overlapping Debt 95
Legal Debt Margin Information 96
Pledged-Revenue Coverage 97
Demographic and Economic Information:
Demographic and Economic Statistics 98 I
Principal Employers 99
Operating Information
Full-time Equivalent City Government Employees by Function/Program 100
Operating Indicator by Function/Program 101
Capital Asset Statistics by Function/Program 102
Other Reports:
Schedule of State Financial Assistance 103
Schedule of Findings and Questioned Costs -State Projects 104
Independent Auditors' Report on Compliance For Each Major State Project and ,
Report on Internal Control Over Compliance in Accordance With Chapter
10.550,Rules of the Auditor General 106
Independent Auditors' Report on Internal Control over Financial Reporting and on
Compliance and Other Matters Based on an Audit of Financial Statements
Performed In Accordance with Government Auditing Standards 108
Independent Auditors' Management Letter 110
Reply to the Independent Auditor's Report 112
Affidavit of Impact Fee Compliance 113
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1WGEVATER1
March 26, 2014
To the Honorable Mayor, and Members of the City Council, and Citizens of the City of Edgewater
City Charter and State law requires that all general-purpose local governments publish a complete set of
financial statements presented in conformity with the generally accepted accounting principles in the
United States of America (GAAP) and that they be audited in accordance with generally accepted
auditing standards in the United States of America by a firm of licensed certified public accountants.
Pursuant to the requirement, it is with great pleasure that we present to the City of Edgewater, the
Comprehensive Annual Financial Report(CAFR)for the fiscal year ended September 30`h, 2013.
This report consists of management's representations concerning the finances of the City of Edgewater.
Consequently, management assumes full responsibility for the completeness and reliability of all the
information presented in this report. To provide a reasonable basis for making these representations,
management of the City of Edgewater has established a comprehensive internal control framework that is
designed both to protect the government's assets from loss, theft, or misuse and to compile sufficient
reliable information for the preparation of the City of Edgewater's financial statements in conformity with
GAAP. Because the cost of internal controls should not outweigh their benefits, the City of Edgewater's
comprehensive framework of internal controls has been designed to provide reasonable rather than
absolute assurance that the financial statements will be free from material misstatements. As
management, we assert that, to the best of our knowledge and belief, this financial report is complete and
reliable in all material respects.
James Moore & Co., P.L. a firm of licensed certified public accountants, has issued an unmodified
("clean") opinion on the City of Edgewater's financial statements for the fiscal year ended September 30,
2013. The independent auditor's report is located at the front of the financial section of this report.
Management's discussion and analysis (MD&A) immediately follows the independent auditor's report.
GAAP requires that management provide a narrative introduction, overview, and analysis to accompany
the basic financial statements in the form of Management's Discussion and Analysis (MD&A). This letter
of transmittal is designated to complement the MD&A and should be read in conjunction with it.
Profile of the Government
The City of Edgewater was incorporated in 1952 and has operated under the Council-Manager form of
government since 1981. Primary responsibilities of the City Manager are to implement the policies of the
elected officials. The City Manager assumes responsibilities of the day-to-day operations of the City,
annual budget preparation, appointing/removing officers and employees. In addition to supervising the
daily operations, the City Manager works with elected officials, committees and citizens to plan for the
future of the community.
The City of Edgewater is located in southeast Volusia County, primarily east of 1-95 south of New Smyrna
Beach, two miles west of the Atlantic Ocean and runs along 10.5 miles of the Indian River coastline. The
City is within the economic zone of Central Florida, which roughly follows Interstate 4 from Tampa through
Orlando to Daytona Beach and the communities along the Atlantic Coast in Volusia County. There are
14,362 acres of land within the City with an estimated population of 20,737.
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The City of Edgewater offers a full range of services to its citizens through multiple funds. The City uses
funds to separate resources and assure that the City adheres to restrictions placed upon it by legislators,
grantors, donors, and other outside parties (e.g. GASB, GAAP). The following is a list of services
provided by each fund:
• General Fund - provides planning and zoning, economic development, building (e.g. permits,
inspections, etc), police, fire, fire rescue, animal control, parks, recreation, streets (new and
maintained), code enforcement, and general administrative services.
• Water and Sewer Fund -provides water and sewer services.
• Refuse Fund - uses a combination of City personnel and assets along with private contracted
companies to provide solid waste collection.
• Stormwater Fund—provides and ensures proper water drainage from all properties.
• Internal Service Funds — account for fleet management services, management information
systems, general liability insurance, health insurance, and workers compensation insurance.
Whenever possible the City seeks alternative sources of revenue to provide services, enhance services,
and supplement the existing expenses in the budget. The most prominent example of alternative revenue
is grants through the federal, state, and local levels.
Local economy
Long established businesses such as Boston Whaler, Edgewater Power Boats, R.J. Dougherty Associates,
Inc, Porta Products, Tropical Blossom Honey, Lane Construction, as well as new businesses provide
employment opportunities within the City. NASA and related supporting enterprises at Cape Canaveral as
well as the cruise industry located at Port Canaveral provide further employment opportunities.
The City of Edgewater currently has a 6.8 percent unemployment rate (in line with the state average of
6.7 percent). During the last year, taxable assessment values of property in Edgewater increased 1.80
percent. The City continues exploring several options to increase economic growth within the City and
improve economic development within southeast Volusia County. The City's Economic Development
Board is continuing its emphasis on result-oriented initiatives as well as the City is working with the
County in creating a Community Revelopment Agency to encourage redevelopment along our US. 1 and
Park Ave. corridor. The City continues to develop many partnerships between various economic
development agencies and local businesses.
The City of Edgewater's outlook for fiscal year 2014 is for modest gains in economic growth as the recovery
and expansion from the financial crisis and national and international recessions gain a small degree of
traction in the local economy. With the modest gains, the City of Edgewater continues to apply for Federal
and State and did receive State Revolving Funds for the renewal and replacement of an aging Waste Water
Treatment plant as well as Department of Transportation funds for sidewalks along our major corridor US. 1.
The Waste Water Treatment Plant R&R should be completed in FY2014 with the Sidewalks to be
completed in FY2015. Without these funds, this project would not have been completed within the
foreseeable future.
Financial planning and budgeting
The City continued to stress expenditure control in preparing the FY2014 General Fund budget. The City ad
valorem millage rate for FY2013 was 6.50, which was 2.17% more than the rolled-back rate. The millage
rate increased from the prior year rate of 6.47, resulting in property tax collections increase of 2.2%due to a
decrease in property assessments
The City adopts a five-year capital improvement plan that identifies future funding needs to maintain,
repair and upgrade capital assets and infrastructure including road resurfacing, water line upgrades and
vehicle and technology replacement programs within the funding constraints. It should be noted;
however, that the CIP is not a fixed document but a flexible, evolutionary document that may change to
reflect changing priorities, opportunities, costs, or different financing approaches.
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Relevant financial policies
The City Council recognizes the need to meet seasonal shortfalls in cash flows, its susceptibility to
emergency or unanticipated expenditures or the possibility of revenue shortfalls during any fiscal year. To
address these issues, the City Council included in its Charter a requirement to maintain reserves at a
minimum of 15 percent to a maximum of 25 percent of the general fund appropriations (excluding operating
transfers). The unassigned fund balance at September 30, 2013 was 23.62% which is within the range of
15-25% per the charter. For Fiscal Year 2013 operating budget cuts were necessary in many areas to offset
increasing operating cost while still maintaining our five year salary step plan.
Budgeting Controls
The annual budget serves as the foundation for the City of Edgewater's financial planning and control. All
departments of the City of Edgewater are required to submit requests for appropriation to the City
Manager. The City Manager then uses these requests as the starting point for developing a proposed
budget. The City Manager then presents this proposed budget to the City Council for review. The City
Council is required to hold public hearings on the proposed budget and to adopt a final budget by no later
than September 30, the close of the City of Edgewater's fiscal year. The appropriated budget is prepared
by fund (i.e., General Fund), department (i.e., Fire Department) and division (i.e., Fire Operations). The
City Manager may make transfers of appropriations within and between divisions and departments;
however, any revisions that alter the total appropriations of any funds must be approved by City Council.
Original and final amended budget-to-actual comparisons are provided in this report for each individual
governmental fund.
Cash management policies and practices
The city administers a cash management and investment program that seeks to maximize, in order of
priority, the preservation of funds, liquidity and interest earnings over its cash and investments. Cash
resources of the individual funds are combined to form a pool of cash and investments. The City's cash
and investment pool balance at September 30, 2013 (not including pension funds) was $12,029,656.
Investment income includes the change in the fair value of investments. During the year monies were
invested in U.S. Agencies and Treasuries and the State Board Administration Local Government
Investment Pool in accordance with the City's Investment Policy. Pension fund assets were invested
mainly in equity and bond funds in accordance with the City's Investment Policy for Retirement Funds.
The total pension fund assets at September 30, 2013 were$27,830,908.
Risk Management
During the ordinary course of its operations, the City is exposed to various risks of losses. The City
maintains commercial insurance coverage in amounts management feels is adequate to protect and
safeguard the assets of the City. In the opinion of the City's management and legal counsel, legal claims
and litigation are not anticipated to have a material impact on the financial position of the City.
Pension and other postretirement benefits
The City of Edgewater sponsors three defined benefit and one defined contribution pension plan for its
employees. The general employee pension has been closed since 1996. Each year an independent
actuary by the pension plan calculates the amount of the Annual Required Contribution (ARC) that the
City of Edgewater must make to the pension plan to ensure that the plan will be able to fully meet its
obligations to retired employees on a timely basis. The following Defined Benefit Plan employee
contributions are required, police and firefighters contribute 6% and general employees contribute 2.5%
of their salary to the plan.
The City provides retirees with the option to purchase health insurance at the City's group rate. This
creates an implicit rate subsidy benefit for the retirees' participation. GASB Statement No. 45 "Other
Postemployment Benefits" was implemented at September 30, 2010. There was neither an OPEB asset
nor liability at transition.
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Certificate of Achievement Award
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a
Certificate of Achievement for Excellence in Financial Reporting to the City of Edgewater for its
comprehensive annual financial report for the fiscal year ended September 30, 2012. This was the twenty-
ninth consecutive year that the City of Edgewater has achieved this prestigious award. In order to be
awarded a Certificate of Achievement, a government must publish an easily readable and efficiently
organized comprehensive annual financial report. This report must satisfy both generally accepted
accounting principles and applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. We believe that our current
comprehensive annual financial report continues to meet the Certificate of Achievement Program's
requirements and we are submitting it to the GFOA to determine its eligibility of another certificate.
Acknowledgements
The preparation of this report would not have been possible without the efficient and dedicated
commitment of the entire Finance Department. The City departments, although not extensively involved
in year-end audit activities, contributed significantly by ensuring the accuracy and integrity of the
accounting information and statistics compiled throughout the year. Without their diligence, the work of
the Finance Department would have been considerably more difficult. Appreciation must also be
expressed to the City's external auditor whose suggestions and attention to detail enhanced the quality of
this report.
In closing, special thanks to the Mayor and City Council for their support and commitment to maintaining
the financial integrity and sustainability of the City.
Respectfully submitted,
Tracey T. Barlow
City Manager Finance Director
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Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
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Presented to
City of Edgewater
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For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
September 30, 2012
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Executive Director/CEO
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VII
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CITY OF EDGEWATER FLORIDA
List of Elected and Appointed Officials
September 30, 2013
CITY COUNCIL ,
Michael L.Thomas, Mayor
Christine Power, Michael Ignasiak,
District 1 District 3
Gigi Bennington, Gene Emter,
District 2 District 4
ADMINISTRATION
CITY MANAGER FINANCE DIRECTOR
Tracey T. Barlow Jonathan McKinney
CITY ATTORNEY FIRE CHIEF
Aaron R. Wolfe Stephen Cousins
CITY CLERK POLICE CHIEF
Bonnie Wenzel David J. Arcieri
PERSONNEL DEVELOPMENT SERVICES
DIRECTOR DIRECTOR
Donna Looney Darren Lear
ENVIRONMENTAL SERVICES LEISURE SERVICES
DIRECTOR DIRECTOR
Brenda Dewees Jack Corder
VIII
CITY OF EDGEWATER FLORIDA
,,.. City Organization Chart
September 30, 2013
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City Council
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City Attorney City Manager Advisory City Clerk
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Services Development', Services Public Safety Services
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Recreation Building Utilities Public Works Fire/Rescue Finance
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Maintenance Planning Water Stormwater J Code Personnel
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or Animal Control Wastewater Refuse Police Technoloion
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Animal Shelter Field Street
ON Operations
Wastewater Fleet
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AI James Moore
t�1 Certified Public Accountants and Consultants
INDEPENDENT AUDITORS' REPORT
rr To the Honorable Mayor,City Council,and City Manager
City of Edgewater,Florida:
Report on the Financial Statements
A" We have audited the accompanying financial statements of the governmental activities, business-type
activities, each major fund, and the aggregate remaining fund information of the City of Edgewater,
Florida(the City), as of and for the year ended September 30, 2013, and the related notes to the financial
statements, which collectively comprise the City's basic financial statements as listed in the table of
es
contents.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this includes
the design, implementation, and maintenance of internal control relevant to the preparation and fair
vie presentation of financial statements that are free from material misstatement, whether due to fraud or
error.
Auditors'Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted
our audit in accordance with auditing standards generally accepted in the United States of America and
the standards applicable to financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
„r the financial statement. The procedures selected depend on the auditors' judgment, including the
assessment of the risks of material misstatement of the financial statements,whether due to fraud or error.
In making those risk assessments, the auditor considers internal control relevant to the City's preparation
and fair presentation of the financial statements in order to design audit procedures that are appropriate in
rr the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City's
internal control. Accordingly, we express no such opinion. An audit also includes evaluating the
appropriateness of accounting principles used and significant estimates made by management, as well as
evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinions.
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,
.lr and the aggregate remaining fund information of the City as of September 30, 2013, and the respective
changes in financial position and, where applicable, cash flows 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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121 Executive Circle 5931 NW 1st Place 2477 Tim Gamble Place,Suite 200
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Daytona Beach,FL 32114-1180 Gainesville,Ft.32607-2063 Tallahassee,FL 32308-4386
Telephone:386/257-4100 Telephone:352/378-1331 Telephone:850/386-6184
Fax:386/255-3261 Fax:352/372-3741 Fax:850/422-2074
ow dab @jmco.com gnv @jmco,com tlh @jmco.com
Member ofAGN International with offices in principal cities worldwide
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Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management's
discussion and analysis and other required supplementary information, as listed in the table of contents,
be presented to supplement the basic financial statements. Such information, although not a part of the
basic financial statements, is required by the Governmental Accounting Standards Board, who considers
it to be an essential part of financial reporting for placing the basic financial statements in an appropriate
operational, economic, or historical context. We have applied certain limited procedures to the required
supplementary information in accordance with auditing standards generally accepted in the United States
of America, which consisted principally of inquiries of management regarding the methods of
measurement and presentation of the required supplementary information. We do not express an opinion
or provide any assurance on the information because the limited procedures do not provide us with
sufficient evidence to express an opinion or provide any assurance.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
comprise City of Edgewater, Florida's basic financial statements. The introductory section, combining
and individual nonmajor fund financial statements, budgetary comparison schedules, statistical section,
and the schedule of state financial assistance, as required by Section 215.97, Florida Statutes, 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, budgetary comparison schedules, and
the schedule of state financial assistance are the responsibility of management and were derived from and
relate directly to the underlying accounting and other records used to prepare the basic financial
statements. Such information has been subjected to the auditing procedures applied in the audit of the
basic financial statements and certain additional procedures, including comparing and reconciling such
information directly to the underlying accounting and other records used to prepare the basic financial
statements or to basic the financial statements themselves, and other additional procedures in accordance
with auditing standards generally accepted in the United States of America. In our opinion, the
information is fairly stated in all material respects in relation to the financial statements as a whole.
The introductory section and statistical section have not been subjected to the auditing procedures applied
in the audit of the basic financial statements and, accordingly, we do not express an opinion or provide
any assurance on them.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated March 13,
2014,on our consideration of City of Edgewater,Florida's internal control over financial reporting and on
our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements
and other matters.The purpose of that report is to describe the scope of our testing of internal control over
financial reporting and compliance and the results of that testing, and not to provide an opinion on
internal control over financial reporting or on compliance. That report is an integral part of an audit
performed in accordance with Government Auditing Standards in considering the City's internal control
over financial reporting and compliance.
a•44* NyC L8.
Daytona Beach,Florida
March 13,2014
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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, 2013. 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
• Net Position - The assets of the City exceeded its liabilities at the close of FY 2012-13 by
$83,089,962, which represents a decrease in net assets of $3,296,815 or 3.82% from
the prior fiscal year.
• The City's governmental funds reported combined ending fund balance of $3,920,037, a
decrease of$1,120,939 from the prior fiscal year.
• At the end of FY 2012-13, the General Fund unassigned fund balance was $2,744,608
or 23.62% of the budgeted FY 2014 General Fund expenditures, excluding transfers.
This represents a increase of$291,685 from the prior fiscal year.
• During the fiscal year, the City's total debt increased by $2,602,228. Governmental debt
decreased by $285,131 and business-type debt reflected an increase of$2,887,359.
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 position. Over time, increases or decreases in net
position may serve as a useful indicator of whether the financial position of the City is improving or
deteriorating.
The statement of activities presents information showing how the government's net position
changed during the most recent fiscal year. All changes in net position are reported as soon as the
underlying event giving rise to the change occurs, regardless of the timing of related cash flows.
Thus, revenues and expenses are reported in this statement for some items that will only result in
cash flows in future fiscal periods (e.g., uncollected taxes and earned but unused vacation leave).
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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 and stormwater management.
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 15-17 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 nine 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 capital
projects fund, both of which are considered to be major funds. Data from the other eight
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 22. Budgetary comparison schedules have been provided for
the nonmajor, debt service and capital projects funds at pages 66-71.
The basic governmental fund financial statements can be found on pages 18-22 of this report.
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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 and stormwater management.
Proprietary funds provide the same type of information as the government-wide financial
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.
The basic proprietary fund financial statements can be found on pages 23-25 of this report.
Internal Services Funds — Internal Service funds are used to account for the financing of
centralized services to the City departments on a cost-reimbursement basis.
The basic internal services fund financial statements can be found on pages 74-76 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 78-79 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 29-57 of this report.
Other Information
In addition to the basic financial statements and accompanying notes, this report also presents
certain required supplementary information concerning the City's progress in its obligation to
provide pension benefits to its employees. The combining statements referred to earlier in
connection with nonmajor governmental funds are presented immediately following the Notes to
Financial Statements. Combining and individual fund statements and schedules can be found on
pages 62-65 of this report.
Government-Wide Financial Analysis
As noted earlier, net position 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 $83,089,962 at the
close of the most recent fiscal year. The following table reflects the condensed statement of net
position for the current and prior years. For more detail see the Statement of Net Position on page
15.
5
1
City of Edgewater's Statement of Net Position (in whole dollars)
Governmental Activities Business-Type Activities Total Primary Government
Assets: 2013 2012 2013 2012 2013 2012
Current and other assets $5,178,148 $6,690,619 $10,627,203 $9,899,175 $15,805,351 $16,589,794
Capital Assets 44,948,205 47,443,547 52,601,859 48,871,661 97,550,064 96,315,208
Total Assets 50,126,353 54,134,166 63,229,062 58,770,836 113,355,415 112,905,002
Liabilities:
Long term liabilities 3,625,438 3,715,131 23,340,342 20,410,868 26,965,780 24,125,999
Other liabilities 710,725 927,778 2,588,948 1,464,448 3,299,673 2,392,226
Total Liabilities 4,336,163 4,642,909 25,929,290 21,875,316 30,265,453 26,518,225
Net Position:
Net investment in capital assets 43,278,270 45,488,481 30,199,966 29,330,978 73,478,236 74,819,459
Restricted 1,000,424 1,063,323 1,860,458 2,250,279 2,860,882 3,313,602
Unrestricted 1,511,496 2,939,453 5,239,348 5,314,263 6,750,844 8,253,716
Total Net Position $45,790,190 $49,491,257 $37,299,772 $36,895,520 $83,089,962 $86,386,777
At the end of the current fiscal year, the government's liabilities increased by $3,747,228 which is
mainly attributed to the increase of long term in business-type activities of $2,887,359. Other
liabilities increased by$1,145,000 which is attributed to increases in accounts payable, OPEB, and
compensated absence liabilities of the City.
Eighty-eight percent (88%) of the City's net position reflect 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 position (3%) represents resources that are
subject to external restrictions on how they may be used. The remaining balance of unrestricted
net position $6,750,844 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 position, both for the government as a whole, as well as for its separate
governmental and business-type activities.
The government's net position decreased by $3,296,815 in the current fiscal year. The
government's restricted net position decreased by $452,720 in the current fiscal year. This was
mainly attributed to decreases in net position being restricted for use in capital projects of$492,956
for business-type activities. Further explanations of the increase are detailed below. The following
table reflects the condensed Statement of Activities for the current and prior years. For more detail
see the Statement of Activities on page 16-17.
6
Statement of Activities
Governmental Activities - Governmental activities decreased the City of Edgewater's net position
by$3,701,067. Key elements of this decrease are as follows:
• Capital grants decreased $950,893 due to major sidewalk construction projects on 30th
Street and U.S. Highway 1 becoming complete or near complete during the year.
• Governmental fixed asset depreciation increased $186,341 from the prior year.
• Public safety expenses increased by $506,290 (8%) during the year primarily due to
increases in the City's portion for Police and Fire pension contributions of$384,130.
Business-Type Activities - Business-type activities increased the City of Edgewater's net position
by$404,252. Key elements of this increase are as follows:
• Charges for services increased by$655,237 (6%) during the year due to a 6.0% increase in
the water and sewer rates.
• Stormwater expenses increased by $131,313 (13%) during the year due to increased
personnel costs and professional services.
• Transfers out increased $110,516 (276%) during the year due to the transfer from the
Water and Sewer Fund to the Capital Projects Fund for the US 1 irrigation project.
The remainder of this page intentionally left blank.
City of Edgewater's Changes in Revenues, Expenses and Net Position (in whole dollars)
1
Governmental Activities Business-Type Activities Total Primary Government
2013 2012 2013 2012 2013 2012
Revenues:
Program revenues-
Chargesforservices $ 788,185 $ 579,090 $ 12,198,937 $ 11,543,700 $ 12,987,122 $ 12,122,790
Operating grants and contributions 586,345 591,002 - - 586,345 591,002
Capital grants and contributions 515,775 1,466,668 83,417 86,937 599,192 1,553,605
General revenues-
Property taxes 3,763,456 3,669,226 - - 3,763,456 3,669,226
Franchise and utility taxes 3,051,649 2,947,266 - - 3,051,649 2,947,266
Intergovernmental 1,814,689 1,680,896 - - 1,814,689 1,680,896
Investment income and miscellaneous 76,082 90,878 74,861 81,371 150,943 172,249
Total revenues 10,596,181 11,025,026 12,357,215 11,712,008 22,953,396 22,737,034
Expenses:
General government 2,098,288 1,869,872 - - 2,098,288 1,869,872
Public safety 7,094,211 6,587,921 - - 7,094,211 6,587,921
Transportation/public works 3,719,716 3,542,650 - - 3,719,716 3,542,650
Leisure services 1,490,505 1,388,241 - - 1,490,505 1,388,241
Interest on long-term debt 45,094 36,397 - - 45,094 36,397
Water and sewer - - 8,086,388 8,020,597 8,086,388 8,020,597
Refuse collection - - 2,558,753 2,604,683 2,558,753 2,604,683
Stormwatermanagement - - 1,157,256 1,025,943 1,157,256 1,025,943
Total expenses 14,447,814 13,425,081 11,802,397 11,651,223 26,250,211 25,076,304
Excess(deficiency)before transfers (3,851,633) (2,400,055) 554,818 60,785 (3,296,815) (2,339,270)
Transfers in/(out) 150,566 40,050 (150,566) (40,050) - - ,
Increase(Decrease)in net position (3,701,067) (2,360,005) 404,252 20,735 (3,296,815) (2,339,270)
Net Position-Beginning 49,491,257 51,851,262 36,895,520 36,874,785 86,386,777 88,726,047
Net Position-Ending $ 45,790,190 $ 49,491,257 $ 37,299,772 $ 36,895,520 $ 83,089,962 $ 86,386,777
The remainder of this page intentionally left blank.
8
Expenses and Program Revenues - Governmental Activities
$8,000,000
$7,000,000 I$7,094,211
$6,000,000
$5,000,000 $3,719,716
$4,000,000 .r r
$3,000,000 $2,098,288
r $1,490505
$2,000,000
$1133974 1
$1,000,000 $567,824
$165479 e $23,028 $45,094 $0
General government Public safety Transportation/public Leisure services Interest on long-term
works debt
❑Expense ®Program Revenues
Revenues by Source — Governmental Activities
Investment Other Taxes
Income& 29%
Miscellaneous
1%
Program
Revenues
18%
Property Taxes
Intergovernmental 35%
17%
❑Property Taxes ®Intergovernmental
0 Program Revenues 0 Investment Income&Miscellaneous
Other Taxes
9
lb
Expenses and Program Revenues - Business-Type
1
$8,086,388 $8,321,516
$9,000,000 _ I
$8,000,000
$7,000,000
$6,000,000
$5,000,000 00
$4,000,000 0101
1
$2,558,753 $2,673,005
$3,000,000 00
-�
$1,157,256 $1,287,833
$2,000,000 00 ‘
$1,000,000 ,
L .___ _
$0 , ________.__,
Water and Sewer Refuse Collection Stromwater Management
I❑Expense III Program Revenues
I
Revenues by Source - Business-Type
I
Capital Grants
and Contributions '
1% /
Investment
Charges for
Income & Services I
Miscellaneous 98%
1%
0 Capital Grants and Contributions I
(Charges for Services
❑Investment Income&Miscellaneous
I
I
10 I
Financial Analysis of the Government's Funds
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, unassigned 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
combined ending fund balances of $3,920,037, a decrease of $1,120,939 in comparison with
the prior year. Approximately 70% of this amount or $2,744,608 constitutes unassigned fund
balance, which is available for spending at the City's discretion. The City has assigned fund
balance for the replacement of City Hall in the amount of $500,000. Restricted fund balance of
$653,259 is for scholarships, public safety, debt service, and capital projects. Nonspendable
fund balance of$22,170 is held for inventories and prepaids.
The General Fund is the chief operating fund of the City of Edgewater. At the end of the current
fiscal year, unassigned fund balance of the General Fund was $2,744,608, while total fund
balance was $3,270,806. As a measure of the General Fund's liquidity, it may be useful to
compare both unassigned fund balance and total fund balance to total fund expenditures.
Unassigned fund balance represents 23% of the total General Fund expenditures, while total
fund balance represents 28% of that same amount.
During the current fiscal year, the fund balance of the General Fund decreased by $1,058,090.
This decrease was attributed to the use of fund balance in the current year.
Proprietary Funds - The City of Edgewater's proprietary funds provide the same type of
information found in the government-wide financial statements, but in more detail.
Unrestricted net position of the proprietary funds at the year-end amounted to $5,204,249. The
total increase in net position for these funds was $366,782. Other factors concerning the
finances of these funds have already been addressed in the discussion of the City of
Edgewater's business-type activities.
General Fund Budgetary Highlights
During the year, actual revenues were $29,761 less than budgeted revenues primarily due to
lesser than anticipated utility and franchise taxes, charges for services, and fines and
forfeitures.
Actual expenditures were $11,338 less than budgeted expenditures primarily due to decreased
repair and maintenance costs.
11
Capital Asset and Debt Administration
Capital Assets - The City of Edgewater's investment in capital assets for its governmental and
business-type activities as of September 30, 2013, amounts to $97,550,064 net of accumulated
depreciation. This investment in capital assets includes land, buildings, improvements,
machinery and equipment and infrastructure. The total increase in the City's investment in
capital assets for the current fiscal year was 1.3%.
City of Edgewater's Capital Assets
(net of depreciation)(in whole dollars)
Governmental Activities Business-Type Activities Total Primary Government
2013 2012 2013 2012 2013 2012
Land $ 23,094,577 $ 23,078,325 $ 1,235,467 $ 1,235,467 $ 24,330,044 $ 24,313,792
Buildings 4,343,106 2,246,730 9,517,679 10,368,082 13,860,785 12,614,812
Improvements 8,866,817 9,215,844 30,836,526 31,905,588 39,703,343 41,121,432
Machinery and equipment 1,155,500 1,249,887 4,499,609 5,026,374 5,655,109 6,276,261
Infrastructure 5,912,669 7,677,137 - - 5,912,669 7,677,137
Construction in progress 1,575,536 3,975,624 6,512,578 336,150 8,088,114 4,311,774
Total $ 44,948,205 $ 47,443,547 $ 52,601,859 $ 48,871,661 $ 97,550,064 $ 96,315,208
Additional information on the City of Edgewater's capital assets can be found in Note IV E of the
notes to the financial statements on pages 40-41 of this report.
Long-Term Debt
At the end of the current fiscal year, the City of Edgewater had total debt outstanding of
$24,162,289. This debt includes bonds payable, notes payable, state revolving loan and capital
leases. In FY 2013, the City issued City of Edgewater, Florida Lease Refunding Note, Series
2013 for the refinancing of the City's Water and Sewer Fund meter equipment lease, State
Revolving Loan for the wastewater treatment plant renewal and replacement, and Branch
Banking and Trust Company Vehicle Lease 2013 for the purchase of seven vehicles
(governmental activities). The City is current on all required debt service obligations.
City of Edgewater's Outstanding Debt
(in whole dollars)
Governmental Activities Business-Type Activities Total Primary Government
2013 2012 2013 2012 2013 2012
Bonds payable $ - $ - $ 13,946,595 $ 15,077,524 $ 13,946,595 $ 15,077,524
Notes payable 1,382,019 1,799,037 4,142,717 - 5,524,736 1,799,037
State revolving loan - - 4,403,042 - 4,403,042 -
Capital leases 287,916 156,029 - 4,527,471 287,916 4,683,500
$ 1,669,935 $ 1,955,066 $ 22,492,354 $ 19,604,995 $ 24,162,289 $ 21,560,061
During the current fiscal year, the City's total debt increased by $2,602,228 (12%).
Additional information on the City of Edgewater's long-term debt can be found in Note IV H of
the notes to the financial statements on pages 42-46 of this report.
12
Reserve Policy
The City Council has approved a Reserve Policy, which was adopted within the City Charter.
The policy addresses that the City is required to maintain reserves at a minimum of 15 percent
with a maximum of 25 percent of the general fund. The reserve range is established based on a
percentage of current years' budget. Reserve levels above the top of the range are deemed to
be available for capital or other lawful purposes.
The Reserve amount per Charter is currently set at $1,950,000 (16%) of the FY2013 — 2014
General Fund Budget. The City Council has designated $500,000 towards the future
replacement of City Hall. The nonspendable balance is $22,170 with restricted balances of
$4,028. The amount available for capital or other lawful purposes less any reserves or set
asides is $2,744,608 at September 30, 2013. The increase in available reserves is attributed to
revenues exceeding forecast while maintaining expenditures at or below forecast.
Next Year's Budget and Rates
The City Council adopted a conservative budget for Fiscal Year 2013/2014. The proposed
budget contains many ambitious work plan objectives that are intended to address the highest
priorities in the community and the goals of the City Council. This budget also sets the financial
foundation to establish an accurate and understandable assessment and tracking of the uses
and sources of all funds. The 2013/2014 budget presents a number of opportunities and
challenges to improve overall service to the community while dealing with the slow recovery as
a result of the severe economic downturn. By any standard this is a very aggressive program of
work that will challenge the capacity of staff and the City Council to accomplish under the slow
recovery.
The proposed General Fund budget for Fiscal Year 2013/2014 includes the following
assumptions:
• Realization of reduced revenues as a result of the current economic conditions.
• Decreases in operating expenditures consistent with the revenue forecasts.
• Maintenance of service levels and program to the extent possible and minimal
reductions in service levels where appropriate.
Requests for Information
This financial report is designed to provide a general overview of the City of Edgewater's
finances for 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.
13
City of
"ED G Inc. 1951 TER
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14
I
CITY OF EDGEWATER, FLORIDA
Statement of Net Position
September 30, 2013
Governmental- Business-type
type Activities Activities Total
ASSETS
Cash and cash equivalents $ 1,579,464 $ 6,365,775 $ 7,945,239
Investments 2,001,223 - 2,001,223
Receivables,net 403,729 1,593,902 1,997,631
Special assessment receivable,net - 169,484 169,484
Due from other governments 639,100 321,025 960,125
Inventories and prepaids 42,531 3,362 45,893
Deferred charges,net - 90,461 90,461
Restricted assets:
Cash and cash equivalents - 2,083,194 2,083,194
Investment in joint venture 163,209 - 163,209
Pension assets 348,892 - 348,892
Capital Assets
Nondepreciable assets 24,670,113 7,748,045 32,418,158
Depreciable assets,net 20,278,092 44,853,814 65,131,906
Total assets 50,126,353 63,229,062 113,355,415
LIABILITIES
Accounts payable and other current liabilities 642,652 1,438,020 2,080,672
Accrued interest payable 8,768 222,736 231,504
Unearned revenue 58,201 - 58,201
Due to other governments 1,104 - 1,104
Customer deposits - 928,192 928,192
Noncurrent liabilities
Due within one year 1,348,273 2,222,133 3,570,406
Due in more than one year 2,277,165 21,118,209 23,395,374
Total liabilities 4,336,163 25,929,290 30,265,453
NET POSITION
Net investment in capital assets 43,278,270 30,199,966 73,478,236
Restricted for:
Debt service - 1,241,486 1,241,486
Public safety 357,346 - 357,346
Capital projects 639,050 618,972 1,258,022
Scholarships 4,028 - 4,028
Unrestricted 1,511,496 5,239,348 6,750,844
Total net position $ 45,790,190 $ 37,299,772 $ 83,089,962
The notes to the financial statements are an integral part of this statement.
15
CITY OF EDGEWATER, FLORIDA
Statement of Activities
For the Fiscal Year Ended September 30, 2013
Program Revenues
Operating Capital
Charges for Grants and Grants and
Functions/Programs Expenses Services Contributions Contributions
Governmental activities:
General administrative $ 2,098,288 $ 165,479 $ - $ -
Public works 3,719,716 169,864 577,754 386,356
Public safety 7,094,211 439,680 8,591 119,553
Culture and recreation 1,490,505 13,162 - 9,866
Interest on long-term debt 45,094 - - -
Total governmental activities 14,447,814 788,185 586,345 515,775
Business-type activities:
Water/Sewer 8,086,388 8,238,099 - 83,417
Refuse 2,558,753 2,673,005 - -
Stormwater 1,157,256 1,287,833 - -
Total business-type activities 11,802,397 12,198,937 - 83,417
Total primary government $ 26,250,211 $ 12,987,122 $ 586,345 $ 599,192
General revenues:
Property taxes
Utility and franchise taxes
Intergovernmental shared revenue-non-program
Investment earnings
Gain on sale of assets
Miscellaneous revenue
Transfers
Total general revenues and transfers
Change in net position
Net position-beginning
Net position-ending
The notes to the financial statements are an integral part of this statement.
16
Net(Expense)Revenue and
Changes in Net Position
Governmental Business-type
Activities Activities Total
$ (1,932,809) $ - $ (1,932,809)
(2,585,742) - (2,585,742)
(6,526,387) - (6,526,387)
.. (1,467,477) - (1,467,477)
(45,094) - (45,094)
(12,557,509) - (12,557,509)
-
235,128 235,128
- 114,252 114,252
- 130,577 130,577
- 479,957 479,957
(12,557,509) 479,957 (12,077,552)
3,763,456 - 3,763,456
3,051,649 - 3,051,649
M 1,814,689 - 1,814,689
25,339 3,879 29,218
11,855 - 11,855
38,888 70,982 109,870
150,566 (150,566) -
8,856,442 (75,705) 8,780,737
(3,701,067) 404,252 (3,296,815)
49,491,257 36,895,520 86,386,777
$ 45,790,190 $ 37,299,772 $ 83,089,962
17
CITY OF EDGEWATER, FLORIDA
Balance Sheet
Governmental Funds
September 30,2013
Other Total
Capital Projects Governmental Governmental
General Fund Fund Funds Funds
ASSETS
Cash $ 770,202 $ 89,255 $ 509,215 $ 1,368,672
Investments 2,001,223 - - 2,001,223 �.
Receivables-net of allowance for uncollectibles 403,706 - 23 403,729
Due from other governments 517,643 121,419 38 639,100
Inventories and prepaids 22,170 - - 22,170
Total assets $ 3,714,944 $ 210,674 $ 509,276 $ 4,434,894
LIABILITIES AND FUND BALANCES
Liabilities
Accounts payable $ 89,075 $ 69,564 $ 1,155 $ 159,794
Accrued liabilities 295,758 - - 295,758
Due to other governments 1,104 - - 1,104
Unearned revenues 58,201 - - 58,201
Total liabilities 444,138 69,564 1,155 514,857
Fund balances
Nonspendable:
Inventories and prepaids 22,170 - - 22,170 ...
Restricted for:
Scholarships 4,028 - - 4,028
Public safety - - 8,454 8,454
Debt service - - 1,727 1,727
Capital projects - 141,110 497,940 639,050
Assigned to:
City Hall 500,000 - - 500,000
Unassigned 2,744,608 - - 2,744,608
Total fund balances 3,270,806 141,110 508,121 3,920,037
Total liabilities and fund balances $ 3,714,944 $ 210,674 $ 509,276 $ 4,434,894
The notes to the financial statements are an integral part of this statement.
i
18
CITY OF EDGEWATER, FLORIDA
Reconciliation of the Balance Sheet of Governmental Funds
To the Statement of Net Position
September 30,2013
Total governmental funds fund balance $3,920,037
Amounts reported for governmental activities in the statement of net position are different because:
Capital assets used in governmental activities are not financial resources and,therefore,are not reported
in the funds-total less accumulated depreciation.
Land and land rights $ 23,094,577
Buildings and improvements 26,115,118
Infrastructure 56,359,796
Furniture and equipment 3,938,677
Construction in progress 1,575,536
Accumulated depreciation (66,226,417)
44,857,287
Investment in joint venture is not a financial asset and therefore is not reported in the funds. 163,209
Internal service funds are used by management to charge the costs of fleet,management information systems
and insurance activities to individual funds.The assets and liabilities of the internal service funds are included
in governmental activities in the statement of net position. 55,819
The cumulative net pension contribution in excess of the annual required contribution is presented as an asset
on the government-wide statement of net position. 348,892
Long-term liabilities are not due and payable in the current period and,therefore,are not reported in the funds.
Compensated absences $ 1,517,215
OPEB 359,136
Long-term debt 1,669,935
(3,546,286)
Accrued interest payable on bonds that is not recognized on the fund statements. (8,768)
Net position of governmental activities $45,790,190
The notes to the financial statements are an integral part of this statement.
19
CITY OF EDGEWATER, FLORIDA
Statement of Revenues, Expenditures, and Changes in Fund Balances
Governmental Funds
For the Fiscal Year Ended September 30,2013
Other Total
Capital Projects Governmental Governmental
General Fund Fund Funds Funds
REVENUES
Taxes:
Property $ 3,728,368 $ - $ 35,088 $ 3,763,456
Utility and franchise taxes 3,051,649 - - 3,051,649
Intergovernmental 2,488,040 441,752 3,303 2,933,095
Licenses and permits 236,820 - - 236,820
Charges for services 1,132,520 - - 1,132,520
Fines and forfeitures 194,651 - 1,200 195,851
Investment earnings 25,211 69 58 25,338
Impact fees - - 44,136 44,136
Miscellaneous revenue 38,539 - - 38,539
Total revenues 10,895,798 441,821 83,785 11,421,404
EXPENDITURES
Current:
Legislative 93,377 - - 93,377
Executive 558,357 - - 558,357
Legal counsel 89,195 - - 89,195
Community development 413,255 6,221 - 419,476
Public works 562,286 - - 562,286
Public safety.
Law enforcement 3,191,318 - 40,796 3,232,114
Fire and emergency services 2,942,859 - - 2,942,859
Code enforcement 144,716 - - 144,716
Animal services 132,794 - - 132,794
Culture and recreation 1,237,586 - - 1,237,586
General administrative services 1,590,455 - - 1,590,455
Debt Service:
Principal 425,714 - 20,000 445,714
Interest 38,296 - 14,419 52,715
Capital outlay 267,125 1,053,679 - 1,320,804
Total expenditures 11,687,333 1,059,900 75,215 12,822,448
Excess(deficiency)of revenues over
(under)expenditures (791,535) (618,079) 8,570 (1,401,044)
OTHER FINANCING SOURCES(USES:1
Transfers in - 676,660 - 676,660
Transfers out (438,994) - (130,000) (568,994)
Issuance of debt 160,583 - - 160,583
Sale of capital assets 11,856 - - 11,856
Total other financing sources(uses) (266,555) 676,660 (130,000) 280,105
Net change in fund balances (1,058,090) 58,581 (121,430) (1,120,939)
Beginning fund balances 4,328,896 82,529 629,551 5,040,976
Ending fund balances $ 3,270,806 $ 141,110 $ 508,121 $ 3,920,037
The notes to the financial statements are an integral part of this statement.
20
ill
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 Fiscal Year Ended September 30,2013
Net change in fund balances-total governmental funds $ (1,120,939)
Amounts recorded for governmental activities in the statement of activities are different because:
Governmental funds report capital outlays as expenditures.However,in the statement of activities the cost
of those assets is allocated over their estimated useful lives and reported as depreciation expense.This
is the amount by which capital outlays exceeded depreciation in the current period.
Expenditure for capital assets $ 1,109,284
Current year depreciation (3,680,699)
(2,571,415)
The net effect of various miscellaneous transactions involving capital assets(I.e.sales,trade-ins and
donations)is to increase net position. (1,230)
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 the governmental funds.
Changes in compensated absences $ (120,195)
Changes in OPEB obligation (63,501)
Changes in interest payable 7,621
Changes in joint venture balance (79,069)
(255,144)
The net revenue of certain activities of internal service funds is reported with governmental activities. (37,470)
.. The issuance of long-term debt(I.e.,bonds and leases)provides current financial resources to governmental
funds,while the repayment of the principal long-term debt consumes the current financial resources of
governmental funds. Neither transaction has any effect on net position.Also,governmental funds report the
effect of premiums,discounts,and deferred amount on refunding,when debt is first issued,whereas these
amounts are deferred and amortized in the Statement of Activities.
Principal payments $ 445,714
Debt issued (160,583)
285,131
Change in net position of governmental activities $ (3,701,067)
The notes to the financial statements are an integral part of this statement.
21
CITY OF EDGEWATER, FLORIDA
Statement of Revenues,Expenditures,and
Changes in Fund Balances--Budget and Actual
General Fund
For the Fiscal Year Ended September 30,2013
Variance with
Budgeted Amounts Final Budget-
Actual Positive
Original Final Amounts (Negative)
REVENUES
Taxes:
Property $ 3,685,403 $ 3,685,403 $ 3,728,368 $ 42,965
Utility and franchise taxes 3,138,576 3,144,388 3,051,649 (92,739)
Intergovernmental 2,393,221 2,435,758 2,488,040 52,282
Licenses and permits 159,550 237,317 236,820 (497)
Charges for services 917,902 1,141,349 1,132,520 (8,829)
Fines and forfeitures 173,500 208,385 194,651 (13,734)
Investment earnings 1,500 25,145 25,211 66 ,
Miscellaneous revenue 80,160 47,814 38,539 (9,275)
Total revenues 10,549,812 10,925,559 10,895,798 (29,761)
EXPENDITURES
Current:
Legislative 102,425 102,425 93,377 9,048
Executive 580,013 564,013 558,357 5,656
Legal counsel 106,500 91,500 89,195 2,305
Community development 486,987 417,987 413,255 4,732
Public works 643,199 582,927 562,286 20,641
Public safety: .».
Law enforcement 3,345,139 3,073,639 3,191,318 (117,679)
Fire and emergency services 2,942,366 2,968,872 2,942,859 26,013
Code enforcement 153,949 153,949 144,716 9,233
Animal services 111,722 134,197 132,794 1,403 -.
Culture and recreation 1,264,226 1,239,626 1,237,586 2,040
General administrative services 1,560,520 1,606,863 1,590,455 16,408
Debt service:
Principal 395,714 440,714 425,714 15,000
Interest 36,600 36,600 38,296 (1,696)
Capital outlay 225,359 285,359 267,125 18,234
Total expenditures 11,954,719 11,698,671 11,687,333 11,338 ..
Excess(deficiency)of revenues over
(under)expenditures (1,404,907) (773,112) (791,535) (18,423)
OTHER FINANCING SOURCES(USES)
Transfers in - - - -
Transfers out (438,994) (438,994) (438,994) -
Proceeds from issuance of debt 187,361 160,583 160,583 - -.
Sale of capital assets 3,500 11,856 11,856 -
Total other financing sources(uses) (248,133) (266,555) (266,555) -
Net change in fund balances (1,653,040) (1,039,667) (1,058,090) (18,423)
Beginning fund balances 4,328,896 4,328,896 4,328,896 -
Ending fund balances $ 2,675.856 $ 3,289,229 $ 3,270,806 $ (18,423)
The notes to the financial statements are an integral part of this statement.
22
III
CITY OF EDGEWATER, FLORIDA
Statement of Net Position
Proprietary Funds
September 30,2013
Business-type Activities-Enterprise Funds
Governmental
Major Funds Activities-
Water/Sewer Stormwater Internal Service
Utility Refuse Utility Utility Total Funds
ASSETS
Current assets:
Cash and cash equivalents $ 4,477,393 $ 851,903 $ 1,036,479 $ 6,365,775 $ 210,792
Receivables,net 1,071,684 354,564 167,654 1,593,902 -
Due from other governments 321,025 - - 321,025 -
Inventories - - - - 20,361
Prepaid items 2,003 316 1,043 3,362 -
`* Special assessments receivable 96,779 - - 96,779 -
Totalcurrentassets 5,968,884 1,206,783 1,205,176 8,380,843 231,153
Noncurrent assets:
Restricted cash and cash equivalents:
,. Debt service 1,464,222 - - 1,464,222 -
Capital projects 618,972 - - 618,972 -
Total restricted cash
and cash equivalents 2,083,194 - - 2,083,194 -
Capital assets:
Land and land rights 966,228 - 269,239 1,235,467 -
Buildings and improvements 66,018,966 69,075 8,298,917 74,386,958 60,684
Machinery and equipment 8,040,160 2,171,490 1,055,534 11,267,184 88,186
Construction in progress 6,446,445 21,651 44,482 6,512,578 -
Less accumulated depreciation (35,713,200) (1,438,278) (3,648,850) (40,800,328) (57,952)
Total capital assets(net
of accumulated depreciation) 45,758,599 823,938 6,019,322 52,601,859 90,918
Special assessment receivable 72,705 - - 72,705 -
Deferred charges 90,461 - - 90,461 -
Total noncurrent assets 48,004,959 823,938 6,019,322 54,848,219 90,918
Total assets $ 53,973,843 $ 2,030,721 $ 7,224,498 $ 63,229,062 $ 322,071
LIABILITIES
Current liabilities:
Accounts payable $ 1,157,289 $ 79,704 $ 2,026 $ 1,239,019 $ 174,302
Accrued liabilities 134,168 45,781 19,052 199,001 12,798
Compensated absences 287,821 110,960 57,352 456,133 28,598
Customer deposits 928,192 - - 928,192 -
Accrued interest payable 222,736 - - 222,736 -
Notes payable-current 493,000 - - 493,000 -
Revenue bonds payable-current 1,273,000 - - 1,273,000 -
Total current liabilities 4,496,206 236,445 78,430 4,811,081 215,698
Noncurrent liabilities:
Compensated absences 157,222 37,617 7,836 202,675 37,780
OPEB obligation 116,506 51,267 21,407 189,180 12,774
Long-term debt payable after one year 20,726,354 - - 20,726,354 -
Total noncurrent liabilities 21,000,082 88,884 29,243 21,118,209 50,554
Total liabilities 25,496,288 325,329 107,673 25,929,290 266,252
NET POSITION
Net investment in capital assets 23,356,706 823,938 6,019,322 30,199,966 90,918
Restricted:
Capital projects 618,972 - - 618,972 -
Debt service 1,241,486 - - 1,241,486 -
Unrestricted 3,260,391 881,454 1,097,503 5,239,348 (35,099)
Total net position $ 28,477,555 $ 1,705,392 $ 7,116,825 $ 37,299,772 $ 55,819
The notes to the financial statements are an integral part of this statement.
23
CITY OF EDGEWATER,FLORIDA
Statement of Revenues,Expense and
Changes in Fund Net Position
Proprietary Funds
For the Fiscal Year Ended September 30,2013
Business-type Activities-Enterprise Funds
Governmental
Major Funds Activities-
Water/Sewer Stormwater Internal Service
Utility Refuse Utility Utility Total Funds
Operating revenues:
Charges for sales and services $ 8,238,099 $ 2,673,005 $ 1,287,833 $ 12,198,937 $ 3,761,605
Operating expenses:
Salaries and employee benefits 2,556,532 1,110,889 577,118 4,244,539 2,579,213
Supplies and materials 574,489 149,254 45,300 769,043 481,804
Contract services 379,656 775,247 9,600 1,164,503 130,490
Other services and charges 1,629,666 346,553 208,563 2,184,782 637,212
Depreciation and amortization 2,409,515 176,810 316,675 2,903,000 13,256
Total operating expenses 7,549,858 2,558,753 1,157,256 11,265,867 3,841,975
Operating income(loss) 688,241 114,252 130,577 933,070 (80,370)
Nonoperating revenues(expenses):
Investment earnings 3,856 23 - 3,879 -
Miscellaneous revenues 66,881 2,816 1,285 70,982 -
Interest expense (536,530) - - (536,530) -
Total nonoperating revenues(expenses) (465,793) 2,839 1,285 (461,669) - v.
Income before capital contributions
and transfers 222,448 117,091 131,862 471,401 (80,370)
Transfers in - - - - 203,571
Transfers out (121,966) (14,300) (14,300) (150,566) (160,671)
Capital contributions and grants 83,417 - - 83,417 -
Change in net position 183,899 102,791 117,562 404,252 (37,470)
Total net position-beginning 28,293,656 1,602,601 6,999,263 36,895,520 93,289 ..
Total net position-ending $ 28,477,555 $ 1,705,392 $ 7,116,825 $ 37,299,772 $ 55,819
The notes to the financial statements are an integral part of this statement.
24
CITY OF EDGEWATER,FLORIDA
Statement of Cash Flows
Proprietary Funds
For the Fiscal Year Ended September 30,2013
Business-type Activities-Enterprise Funds
Governmental
Major Funds Activities-
Water/Sewer Stormwater Internal Service
Utility Refuse Utility Utility Total Funds
Cash flows from operating activities:
Receipts-customers and users $ 8,153,531 $ 2,679,741 $ 1,288,438 $ 12,121,710 $ 3,765,041
xi. Payments-suppliers (1,487,940) (1,258,425) (263,554) (3,009,919) (3,490,448)
Payments-employees (2,506,418) (1,141,766) (554,709) (4,202,893) (311,286)
Net cash provided(used)by operating activities 4,159,173 279,550 470,175 4,908,898 (36,693)
Cash flows from noncapital financing activities:
Cash paid to other funds (121,966) (14,300) (14,300) (150,566) -
Cash received from other funds - - - - 42,900
Net cash provided(used)by noncapital financing activities (121,966) (14,300) (14,300) (150,566) 42,900
Cash flows from capital and related financing activities:
Acquisition and construction of capital assets (6,355,171) (153,270) (124,757) (6,633,198) (90,559)
Interest payments on debt (539,310) - - (539,310) -
Capital contributions and fees 1,010,112 2,816 1,285 1,014,213 -
Proceeds from issuance of debt 8,544,668 - - 8,544,668 -
Principal paid on debt (5,978,334) - - (5,978,334) -
Net cash used by capital and related financing activities (3,318,035) (150,454) (123,472) (3,591,961) (90,559)
Cash flows from investing activities:
Interest on investments 3,856 23 - 3,879 -
Net cash provided by investing activities 3,856 23 - 3,879 -
Net increase(decrease)in cash and cash equivalents 723,028 114,819 332,403 1,170,250 (84,352)
Beginning cash and cash equivalents 5,837,559 737,084 704,076 7,278,719 295,144
Ending cash and cash equivalents $ 6,560,587 $ 851,903 $ 1,036,479 $ 8,448,969 $ 210,792
Reconciliation of operating income(loss)to net cash provided
(used) by operating activities:
Operating income $ 688,241 $ 114,252 $ 130,577 $ 933,070 $ (80,370)
Adjustments to reconcile operating income(loss)to net cash provided
(used)by operating activities:
Depreciation and amortization 2,409,515 176,810 316,675 2,903,000 13,256
(Increase)decrease in assets:
Accounts receivable (74,397) 6,736 605 (67,056) 3,436
Inventories (2,003) (316) (1,043) (3,362) 7,238
Increase(decrease)in liabilities:
Accounts payable and accrued expenses 1,098,882 12,256 164 1,111,302 8,005
w. Compensated absences 28,383 (39,425) 19,037 7,995 8,995
OPEB obligation 20,723 9,237 4,160 34,120 2,747
Customer deposits (10,171) - - (10,171) -
Total adjustments 3,470,932 165,298 339,598 3,975,828 43,677
.. Net cash provided(used)by operating activities $ 4,159,173 $ 279,550 $ 470,175 $ 4,908,898 $ (36,693)
Classified As
Cash and cash equivalents $ 4,477,393 $ 851,903 $ 1,036,479 $ 6,365,775 $ 210,792
,or Restricted cash and cash equivalents 2,083,194 - - 2,083,194 -
Total $ 6,560,587 $ 851,903 $ 1,036,479 $ 8,448,969 $ 210,792
As
The notes to the financial statements are an integral part of this statement.
r
r
25
r
CITY OF EDGEWATER, FLORIDA
Statement of Fiduciary Net Position
Fiduciary Funds
September 30, 2013
Pension
Trust Funds
ASSETS
Cash and cash equivalents $ 32,852
Accrued interest 92,210
Investments,at fair value:
Money market funds 1,019,197
Certificates of deposit 49,683
Bonds -
US Treasury notes 552,657
GNMA 1,045,755
Municipal bonds 1,051,546
Corporate bonds 6,054,079
Equities 9,393,302
Mutual fund-equities 8,664,689
Total assets 27,955,970
LIABILITIES
Deferred contributions 117,379
Total liabilities 117,379
NET POSITION
Held in trust for pension benefits $ 27,838,591
The notes to the financial statements are an integral part of this statement.
26
CITY OF EDGEWATER, FLORIDA
Statement of Changes in Fiduciary Net Position
Pension Trust Funds
For the Fiscal Year Ended September 30, 2013
Pension Trust
Funds
ADDITIONS
Contributions:
Employer $ 1,715,026
Employee 173,932
State of Florida 250,381
Total contributions 2,139,339
Investment earnings(loss):
Interest and dividends 332,627
Net increase in the fair value of investments 2,853,011
Total investment earnings(loss) 3,185,638
Less investment expenses (58,444)
Net investment earnings(loss) 3,127,194
Total Additions 5,266,533
DEDUCTIONS
Pension benefits 5,253,107
Administrative expenses 206,869
Total deductions 5,459,976
Change in net assets (193,443)
Net position-beginning of year 28,032,034
Net position-end of Year $ 27,838,591
The notes to the financial statements are an integral part of this statement.
27
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28
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
I. Summary of Significant Accounting Policies
The accompanying financial statements present the financial position, changes in financial position and
cash flows of the applicable fund types governed by the City Council of the City of Edgewater, Florida
("the City") and have been prepared in conformity with accounting principles generally accepted in the
United States of America (GAAP) as applied to governmental units. The Governmental Accounting
Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting
and financial reporting principles. The most significant of the City's accounting policies are described
below.
A. Reporting Entity:
The City of Edgewater was originally incorporated under general law on October 20, 1924. The City became
the City of Edgewater and incorporated in 1951 as a political subdivision of the State of Florida and a
municipal corporation with a five-member Council, including a Mayor and Vice-Mayor. The registered
voters of the City of Edgewater elect the Mayor and Council. The Council appoints the City Manager, who
in turn performs as the administrator of the everyday operations of the City. The City provides a full range
of municipal services as directed by the City Charter including general government, public safety, public
improvements, planning and zoning, water and sewer service, refuse collection, a recycling program, a
stormwater management utility program, and related general and administrative services to 20,737
residents.
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 component units
to be included within the reporting entity.
B. Government-wide and Fund Financial Statements:
The government-wide financial statements (i.e., the statement of net position and the statement of
changes in net position) report information on all of the non-fiduciary activities of the City. For the most
part the effect of inter-fund 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
segments are offset by program revenues. Direct expenses are those that are clearly identifiable with a
specific function or segment. Certain indirect expenses are included in the program expense reported for
individual functions and segments. 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
29
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
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 as general revenues.
Separate fund 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 full accrual basis of accounting, as are the proprietary fund and fiduciary fund financial
statements. Revenues are recorded when earned and expenses are recorded when a liability is incurred,
regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for
which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility
requirements imposed by the provider have been met.
Grant funds received prior to the incurrence of eligible expenditures are reported as deferred revenues in
the fund financial statements and are included in accounts payable and other current liabilities on the
government-wide financial statements.
Governmental fund financial statements are reported using the current financial resources measurement
focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both
measurable and available. Revenues are considered to be available when they are collectible within the
current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the City
considers revenues to be available if they are collected within 60 days of the end of the current fiscal
period. Expenditures 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 when payment is due.
Property taxes, franchise taxes, certain other tax revenues, intergovernmental revenues, 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. All other revenue items are considered to
be measurable and available only when the City receives cash.
The City reports the following major governmental funds:
• The General Fund is the City's primary operating fund. It accounts for all financial resources
of the general government, except those required to be accounted for in another fund.
• The Capital Projects Fund is used to account for the financial resources to be used for the
acquisition or construction of major capital facilities (other than those financed by proprietary
and trust funds).
The City reports the following major proprietary funds:
• The Water and Sewer Utility Fund is used to account for the activities of the City's water and
wastewater systems, which are financed similar to private business enterprises, where the
costs, including depreciation, of providing services to the general public on an ongoing basis
are financed through user charges.
30
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
• The Refuse Utility Fund accounts for the activities of the City's refuse collection and recycling
services.
• The Stormwater Management Utility Fund accounts for the activities of the City's stormwater
management, conservation, protection, control, use and enhancement of stormwater.
Additionally, the City reports the following fund types:
• Special Revenue Funds account for specific revenue resources that are restricted by law or
administrative action to expenditures for specific purposes.
• Pension Trust Funds account for the activities of the Police Officers Pension Fund, the
Firefighters Pension Fund and the General Employees Pension Fund, which accumulate
resources for pension benefit payments to qualified employees.
• Internal Services Funds account for fleet management services, management information
systems, general liability insurance, health insurance, and workers compensation insurance.
As a rule the effect of inter-fund activity has been eliminated from the government-wide financial
statements. Exceptions to the rule are payments-in-lieu of taxes and other charges between the
government's water, sewer, and stormwater functions 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.
Internal, 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 non-operating items. Operating
revenues and expenses generally result from providing services and producing and delivering goods in
connection with a proprietary fund's principal ongoing operations. The principal operating revenues of the
Water and Sewer Utility Fund, the Refuse Fund, and the Stormwater Management Utility Fund are
charges to customers for sales and services. The Water and Sewer Utility fund also recognize as
operating revenue the portion of impact fees intended to recover the cost of connecting new customers to
the system. Operating expenses for the 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 non-operating revenues and expenses.
Sometimes the government will fund outlays for a particular purpose from both restricted (e.g., restricted
bond or grant proceeds) and unrestricted resources. In order to calculate the amounts to report as
restricted — net position and unrestricted — net position in the government-wide and proprietary fund
financial statements, a flow assumption must be made about the order in which the resources are
considered to be applied. It is the government's policy to consider restricted — net position to have been
depleted before unrestricted— net position is applied.
The preparation of financial statements in conformity with accounting principles generally accepted in the
United States requires management to make use of estimates that affect reported amounts in the basic
31
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
financial statements. Actual results could differ from estimates. When both restricted and unrestricted
resources are available for use, it is the City's policy to use restricted resources before unrestricted
resources.
D.Assets, Liabilities, and Net Position or Equity
1. Deposits and investments
The City's cash consists of cash on hand, demand deposits, and equity in pooled cash. The equity in
pooled cash represents a fund's share of a cash pool maintained by the City for the use of all funds
except the pension trust funds and funds that require separate bank accounts.
Florida Statutes and/or the City's investment policy authorize the City to invest in the Local Government
Surplus Funds Trust Fund Investment Pool, United States Government Securities, United States
Government Agencies, Federal Instrumentalities, Interest Bearing Time Deposit or Saving Accounts,
Repurchase Agreements, Commercial Paper, High Grade Corporate Notes, Bankers' Acceptances, State
and/or Local Government Taxable and/or Tax-Exempt Debt, Registered Investment Companies (Money
Market Mutual Funds).
Florida Statutes and/or the pension plans' investment policies allow the City's retirement plans' trustees to
invest in time deposits, savings and money market deposit accounts of a national bank, a state bank
insured by the Bank Insurance Fund, a savings/building and loan association insured by the Savings
Association Insurance Fund, a state or federal chartered credit union whose share accounts are insured
by the National Credit Union Share Insurance Fund; Obligations issued by the United States Government
or obligations guaranteed as to principal and interest by the United States Government or by an agency
of the United States Government; stocks, bonds or other evidences of indebtedness issued or guaranteed
by a corporation organized under the laws of the United States or the District of Columbia; foreign stocks,
bonds or other evidences of indebtedness; and real estate investments made through participation in
diversified commingled funds of real properties.
Investments are stated at fair value. Changes in the fair value during the year are included in investment
income. The Local Governmental Surplus Funds Trust Fund (LGSF) is governed by Chapter 19-7 of the
Florida Administrative Code which identifies the Rules of the State Board of Administration (SBA). These
rules provide guidance and establish the general operating procedures for the administration of the
LGSF. Additionally, the Office of the Auditor General performs the operational audit of the activities and
investments of the SBA. The LGSF is not a registrant with the Securities and Exchange Commission;
however, the Board has adopted operating procedures consistent with the requirements for a 2a-7-like
fund. The LGSF Pool's investments are recorded at amortized cost.
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/due from other funds" (i.e., the current portion of inter-
fund loans) or "advances to/from other funds" (i.e., the non-current portion of inter-fund loans). All other
outstanding balances between funds are reported as "due to/due from other funds". Any residual
balances outstanding between governmental activities and business-type activities are reported in the
governmental-wide financial statements as "internal balances".
Accounts receivable balances are shown net of the allowance for uncollectibles. The allowances are
determined based on management estimates of uncollectible amounts.
32
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
Advances between funds, as reported in the fund financial statements, are offset by nonspendable fund
balance in applicable governmental funds to indicate that they are not available for appropriation and are
not expendable available financial resources.
3. Inventories and prepaid items
Inventories are valued at cost, using the first-in/first-out (FIFO) method. The costs of governmental fund-
type inventories are recorded as expenditures when consumed rather than when purchased. Payments
made to vendors for services that will benefit periods beyond the current fiscal year are recorded as
prepaid items.
4. Restricted assets
Certain proceeds of revenue bonds, as well as certain resources set aside for their repayment, are
classified as restricted assets on the balance sheet and statement of net position and their use is limited
by applicable bond covenants. Restricted cash and investments in the enterprise funds represent debt
issuance proceeds that are restricted assets for purchase of assets, construction and repayment of
bonded debt respectively. In the enterprise fund statement of net position, bond issuance proceeds as
well as other assets are set aside for their repayment and itemized in the restricted cash and investments.
5. Capital assets
In the Government Wide and Proprietary Fund financial statements, capital assets purchased or acquired
are carried at historical cost or estimated historical cost. Contributed assets are recorded at fair market
value as of the date received. The City defines capital assets as assets with an initial, individual cost of
more than $5,000 and an estimated useful life in excess of one year. The costs of normal maintenance
and repairs that do not add to the value of the assets or materially extend asset lives are not capitalized.
The City has implemented the provisions of GASB Statement No. 34. In this process, infrastructure
assets are being accounted for using different methods. For governmental activities, the cost or estimated
cost of roads and sidewalks are presented. The City compiled this information and recorded all roads and
sidewalks acquired after June 30, 1980 during the fiscal year ending September 30, 2007. For business
type activities, infrastructure assets have been capitalized at cost. Water and sewer utility improvements
are being depreciated over their useful lives. The City has recorded all drainage infrastructure acquired
including pre-GASB 34 assets.
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, net of any interest earnings on specific project debt
issued. In Governmental funds capital outlay (capital assets) are reported as expenditures and no
depreciation expense is reported.
Buildings and improvements, improvements other than buildings, and machinery and equipment
(including assets amortized under lease purchase contracts) are amortized using the straight-line method
over the following estimated useful lives:
Infrastructure 20-30 Years
Buildings and improvements 10-50 Years
Improvements other than buildings 5-65 Years
Machinery and equipment 3-35 Years
33
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
6. Compensated absences
The City records the vested portion of accumulated unused compensated absences at year-end based on
each employee's unused hours and rate of pay, including the City's share of Social Security and
Medicare taxes and pension costs. All compensated absences are accrued when earned in the
government-wide and proprietary fund financial statements as accrued liabilities. A liability for these
amounts is reported in the governmental funds only if they have matured, for example, as a result of
employee resignations and retirements. The liability for compensated absences in the Enterprise Fund
Types is liquidated in the Enterprise Fund in which the liability originally incurred.
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 position. 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.
8. Fund balance
Beginning with fiscal year 2011, the City implemented GASB Statement No. 54, "Fund Balance Reporting
and Governmental Fund Type Definitions." This Statement provides more clearly defined fund balance
categories to make the nature and extent of the constraints placed on a government's fund balance more
transparent. The following classifications describe the relative strength of the spending constraints:
Nonspendable fund balance - amounts that are not in spendable form (such as prepaid expenses and
advances due from other funds)or are required to be maintained intact.
Restricted fund balance - amounts constrained to specific purposes by their providers (such as grantors,
bondholders, and higher levels of government), through constitutional provisions or by enabling
legislation.
Committed fund balance - amounts constrained to specific purposes by the City itself, using its highest
level of decision-making authority (City Council). To be reported as committed, amounts cannot be used
for any other purpose unless the City takes the same highest level action to remove or change the
constraint. City Council establishes (and modifies or rescinds) fund balance commitments by passage of
a resolution.
Assigned fund balance - amounts the City intends to use for a specific purpose. Intent can be expressed
by the City Council or as delegated to the City Manager. The City Council has by resolution authorized
City management to assign fund balance. The council may also assign fund balance as it does when
appropriating fund balance to cover a gap between estimated revenue and appropriations in the
subsequent year's appropriated budget. Unlike commitments, assignments generally only exist
temporarily. In other words, an additional action does not normally have to be taken for the removal of an
34
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
assignment. Conversely, as discussed above, an additional action is essential to either remove or revise
a commitment.
Unassigned fund balance - amounts that are available for any purpose. Positive amounts are reported
only in the general fund.
Disbursements of fund balances will first be made from restricted amounts when both restricted and
unrestricted fund balance is available.Additionally, the City will first use committed fund balance, followed
by assigned fund balance, and then unassigned fund balance when expenditures are incurred for
purposes which amounts in any of the unrestricted fund balance classifications could be used.
II. Reconciliation of Government-wide and Fund Financial Statements
A. Explanation of Certain Differences Between the Governmental Fund Balance Sheet and the
Government-wide Statement of Net position:
The governmental fund balance sheet includes a reconciliation between fund balance — total
governmental funds and net position — governmental activities as reported in the government-wide
statement of net position.
B. Explanation of Certain Differences Between the Governmental Fund Statements 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 balance includes a
reconciliation between net changes in fund balances — total governmental funds and changes in net
position of governmental activities as reported in the government-wide statement of activities.
Ill. Stewardship, Compliance and Accountability
A. Budgetary Information:
The annual operating budgets are adopted by City Council using the following procedures:
• Annual budgets are adopted for all funds of the City except for the Pension Trust funds that are
effectively controlled through governing agreements and related City ordinances. The annual
operating budgets are prepared on a basis consistent with accounting principles generally
accepted in the United States of America. Annual budget appropriations lapse at the end of each
fiscal year, except for unexpended appropriations on open grant programs and capital projects,
which are carried forward in subsequent annual budgets.
• Encumbrance accounting is employed in governmental funds. Encumbrances represent open
purchase orders and other commitments for goods/services that are not yet received and are
recorded to reserve that portion of the applicable appropriation. Encumbrances are recognized
as expenditures in the period in which the actual goods/services are received and a liability is
incurred. Encumbrances outstanding at year-end are canceled and re-appropriated in the
succeeding year's budget; such amounts, if material, are disclosed in the notes as commitments.
• Prior to the first day of August of each year, the City Manager prepares a recommended budget
for the next succeeding fiscal year and submits it to the City Council. The recommended budget
includes proposed expenditures and the source of receipts to finance them.
• City Council holds a series of budget workshops in addition to a minimum of two public hearings
on the proposed budget and adopts the official annual budget of the City, by ordinance, prior to
September 30.
35
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
• The budget, as adopted, may only be amended through formal approval by City Council.
Budgetary integration is established in the accounting records for control purposes at the object
of expenditure level; however, the City Charter establishes the level at which expenditures may
not legally exceed budget at the fund level. Therefore, the City Manager may transfer budgeted
amounts within and between departments of the City without formal approval by City Council.
B. Deficit Fund Equity:
At September 30, 2013, Fully Insured and Workers Comp internal service funds reported $84,492 and
$1,471 deficit net positions, respectively.
C.Ad Valorem Property Taxes:
Under Florida law, the assessment of all properties and the collections of all county, municipal, and
school board property taxes are consolidated in the offices of the County Property Appraiser and the
County Tax Collector. Florida Statutes regulating tax assessment are also designed to assure a
consistent property valuation method statewide. State Statutes permit cities to levy property taxes at a
rate of up to ten (10) mills. The millage rate in effect for the fiscal year ended September 30, 2013, was
$6.50 and the Edgewater l&S 2005 voted debt millage was $.0612 for a total millage of$6.5612.
The tax levy of the City is established by the City Council prior to October 1 of each year and the Volusia
County Property Appraiser incorporates the millage into the total tax levy, which includes the
municipalities, independent districts and the County School Board tax requirements.
Property taxes are levied in November and attached as a lien on property as of January 1 of each year.
All unpaid taxes become delinquent on April 1 following the year in which they are assessed. Discounts
are allowed for early payment at the rate of 4% for payments received in the month of November, 3% for
payments received in the month of December, 2% for payments received in the month of January and 1%
for payments received in the month of February. The taxes paid in March are not subject to discount. Tax
certificates on all property for which taxes are delinquent are sold on or about June 1 of each year.
D. Connection Fees and Impact Fees:
Water and sewer connection fees represent reimbursement of the costs incurred to perform the
connection of the respective utilities. These fees are recorded as non-operating revenue at the time of
service. Impact fees, which are not considered connection fees since they substantially exceed the cost
of connection, are recorded as non-operating revenue in the period earned in the appropriate Enterprise
Fund.
IV. Detailed Notes on All Funds
A. Deposits:
At September 30, 2013, the carrying amount of the City's bank deposits was $10,013,344. The bank
balance at September 30, 201:3 was $10,327,567, all of which is held by a bank that qualifies as a public
depository, as required by Chapter 280 of the Florida Statutes. All of the deposits were covered by the
FDIC or collateralized in accordance with the "Florida Security for Public Deposits Act". (Under the Act,
every qualified public depository shall deposit with the Treasurer eligible collateral having a market value
equal to 50% of the average daily balance for each month that all public deposits are in excess of any
applicable deposit insurance. If the public deposits exceed the total amount of the regulatory capital
accounts of a bank or the regulatory net worth of a savings association, the required collateral shall have
a market value equal to 125% of the deposits). Of the bank balance, no amount was uninsured and
uncollateralized in banks or savings and loans not qualifying under the Act at September 30, 2013.
36
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
B. Investments:
The City Council formally adopted a comprehensive investment policy pursuant to Section 218.415,
Florida Statutes that established permitted investments, asset allocation limits and issuer limits, credit
ratings requirements and maturity limits to protect the City's cash and investment assets. The City
maintains a cash and investment pool for the use of all funds except the pension trust funds and funds
that require separate bank accounts.
The City's investment policy allows for the following investments: Local Government Surplus Funds
Trusts (SBA), SEC registered money market funds, Interest- bearing time deposits or savings accounts,
direct obligations of the U.S. Treasury, Federal agencies and instrumentalities, 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 and Other investments authorized by ordinance.
Investments of the defined benefit pension plans consist principally of debt and equity mutual funds, all of
which are authorized by the plans.
Interest Rate Risk
The City's investment policy does not specifically address interest rate risk; however the general investment
policy is to apply the prudent-person rule: Investments are made as a prudent person would be expected to
act, with discretion and intelligence, to seek reasonable income, preserve capital, and in general, avoid
speculative investments. The City manages its exposure to declines in fair values by investing primarily in
pooled investments that have a weighted average maturity of one year or less, with a special provision
allowing up to 20%of the investment portfolio to have a maturity of not more than five years.
As of September 30, 2013, the City had the following investments and effective duration presented in
terms of years:
Investment Maturities(in Years)
Fair Less More Credit
Investment Type Value Than 1 1-5 6-10 Than 10 Rating
Government-wide
Investments Subject to Rate Risk:
SBA LGIP $ 812,329 $ 812,329 $ - $ - $ - AAAm
SBA Fund B 46,714 - 46,714 - - Unrated
Corporate bond 1,142,180 1,142,180 - - - A
Total government-wide investments $ 2,001,223 $ 1,954,509 $ 46,714 $ - $ -
Fiduciary Funds
Investments Subject to Rate Risk:
Money market funds $ 1,019,197 $ 1,019,197 $ - $ - $ - N/A
Certificates of deposit 49,683 - 49,683 - -
Bonds:
US treasury notes 552,657 - 232,313 - 320,344 N/A
GNMA 1,045,755 - - - 1,045,755 N/A
Municipal obligations 1,051,546 474,180 385,680 191,686 -
Corporate bonds 6,054,079 480,047 3,052,588 1,435,874 1,085,570 **
$ 9,772,917 $ 1,973,424 $ 3,720,264 $1,627,560 $2,451,669
Other Investments:
Corporate equities 9,393,302
Mutual funds—equity 8,664,689
Total other investments 18,057,991
Total fiduciary fund investments 27,830,908
Total City
Investments $ 29,832,131
* -The Standard and Poor's credit ratings range from BBB+to AA-and Moody's credit ratings range from
Baa2 to Aa2 for the Municipal obligations.
** - The Standard and Poor's credit ratings range from BBB- to AAA and Moody's credit ratings range
from Baa3 to Aa2 for the Corporate bonds.
37
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
Credit Risk
The City's investment policy limits credit risk by restricting authorized investments to those described
above. Also the policy requires that investments held are to be diversified to the extent practicable to
control the risk of loss resulting from over concentration of assets in a specific maturity, issue, instrument,
dealer or bank through which financial instruments are bought and sold.
Custodial Credit Risk
The City's investment policy pursuant to Section 218.415(18), Florida Statutes requires securities, with
the exception of certificates of deposits, shall be held with a third party custodian; and all securities
purchased by, and all collateral obtained by the City should be properly designated as an asset of the
City. The securities must be held in an account separate and apart from the assets of the financial
institution. A third party custodian is defined as any bank depository chartered by the Federal
Government, the State of Florida, or any other state or territory of the United States which has a branch
or principal place of business in the State of Florida, or by a national association organized and existing
under the laws of the United States which is authorized to accept and execute trusts and which is doing
business in the State of Florida. Certificates of deposits will be placed in the provider's safekeeping
department for the term of the deposit.
As of September 30, 2013, the City's investment portfolio was held with a third-party custodian as
required by the City's investment policy. The City's investment policy requires that time deposit
investments be made only with banking institutions that are members of the State of Florida collateral
pool. Florida Statutes authorize, and the state administers, a collateral pool that ensures no loss of public
funds.
Concentration of Credit Risk
The City's investment policy requires diversification, but does not specify limits on types of investments.
C. Receivables:
Receivables as of year-end including the applicable allowances for uncollectible accounts are as follows:
Capital Nonmajor
Governmental Funds General Projects Funds Total
Receivables:
Accounts $ 527,788 $ - $ 23 $ 527,811
Intergovernmental 517,643 121,419 38 639,100
Gross receivables 1,045,431 121,419 61 1,166,911
Less:allowance for uncollectible (124,082) - - (124,082)
Net total receivables $ 921,349 $ 121,419 $ 61 $ 1,042,829
Water/Sewer
Proprietary Funds Utility Refuse Utility Stormwater Utility Total
Receivables:
Accounts $ 1,543,116 $ 504,021 $ 231,642 $ 2,278,779
Intergovernmental 321,025 - - 321,025
Special Assessments 169,484 - - 169,484
Gross receivables 2,033,625 504,021 231,642 2,769,288
Less:allowance for uncollectible (471,432) (149,457) (63,988) (684,877)
Net total receivables $ 1,562,193 $ 354,564 $ 167,654 $ 2,084,411
Governmental funds report deferred revenue in connection with receivables for revenues that are not
considered to be available to liquidate liabilities in the current period. No deferred revenue is reported as
38
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
of September 30, 2013. Governmental funds also defer revenue recognition and report unearned revenue
in connection with resources that have been received, but not yet earned. At the end of the fiscal year,
unearned revenue, in the amount of $58,201, reported in the major and non-major governmental funds
was deferred business tax receipts. Such amounts have been included as current liabilities on the
government-wide financial statements.
D. Interfund Receivables, Payables, and Transfers:
The composition of Interfund balances as of September 30, 2013 is as follows:
Transfers In
Capital Internal Service Internal Service
Projects MIS Fleet Total
Transfers Out:
General Fund $ 438,994 $ - $ -$ 438,994
Recreation Impact 130,000 - - 130,000
Enterprise:
Water Sewer 107,666 14,300 - 121,966
Refuse - 14,300 - 14,300
Stormwater - 14,300 - 14,300
Internal Service:
Fully Insured - 113,802 46,869 160,671
Total $ 676,660 $ 156,702 $ 46,869 $ 880,231
Transfers are used to 1) move revenues from the fund with collection authorization to the fund that statute
or budget requires expending them and, 2) move unrestricted fund revenues to finance various programs
that the government must account for in other funds in accordance with budgetary authorizations.
Remainder of page intentionally left blank
39
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
E. Capital Assets:
Capital asset activity for the year ended September 30,2013,was as follows:
Governmental activities:
Beginning Balance Increases Decreases Ending Balance
Capital assets not being depreciated:
Land $ 23,078,325 $ 16,252 $ - $ 23,094,577
Construction in progress 3,975,624 931,368 (3,331,456) 1,575,536
Total assets not being depreciated 27,053,949 947,620 (3,331,456) 24,670,113
Capital assets being depreciated:
Buildings 4,599,533 2,397,097 (595) 6,996,035
Improvement other than buildings 18,964,086 278,055 (62,374) 19,179,767
Machinery and equipment 3,913,415 254,277 (140,829) 4,026,863 ""
Infrastructure 55,705,548 654,248 - 56,359,796
Total assets being depreciated 83,182,582 3,583,677 (203,798) 86,562,461
Less accumulated depreciation for: .
Buildings (2,352,803) (300,724) 598 (2,652,929)
Improvement other than buildings (9,748,242) (625,851) 61,143 (10,312,950)
Machinery and equipment (2,663,528) (348,664) 140,829 (2,871,363)
Infrastructure (48,028,411) (2,418,716) - (50,447,127)
Total accumulated depreciation (62,792,984) (3,693,955) 202,570 (66,284,369)
Total capital assets,being depreciated,net 20,389,598 (110,278) (1,228) 20,278,092
Governmental activities capital assets,net $ 47,443,547 $ 837,342 $ (3,332,684) $ 44,948,205
Business-type activities:
Beginning Balance Increases Decreases Ending Balance
Capital assets not being depreciated:
Land $ 1,235,467 $ - $ - $ 1,235,467
Construction in progress 336,150 6,441,621 (265,193) 6,512,578
Total assets not being depreciated 1,571,617 6,441,621 (265,193) 7,748,045
Capital assets being depreciated:
Buildings 24,565,769 - - 24,565,769
Improvement other than buildings 49,609,593 240,080 (28,484) 49,821,189
Machinery and equipment 11,157,136 219,616 (109,568) 11,267,184 m
Total assets being depreciated 85,332,498 459,696 (138,052) 85,654,142
Less accumulated depreciation for:
Buildings (14,197,687) (850,403) - (15,048,090)
Improvement other than buildings (17,704,005) (1,307,336) 26,678 (18,984,663)
Machinery and equipment (6,130,762) (745,432) 108,619 (6,767,575)
Total accumulated depreciation (38,032,454) (2,903,171) 135,297 (40,800,328)
Total capital assets,being depreciated,net 47,300,044 (2,443,475) (2,755) 44,853,814
Business-type activities capital assets,net $ 48,871,661 $ 3,998,146 $ (267,948) $ 52,601,859
40
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
Depreciation expense was charged to functions/programs of the primary government as follows:
Governmental activities:
General government $ 76,409
Public safety 432,192
Transportation/public works 2,932,592
Leisure services 239,506
Capital assets held by the City's internal service funds 13,256
are charged to the various functions based on their
usage of the assets
Total depreciation expense-governmental activities $3,693,955
Business-type activities:
Water Sewer Utility $ 2,409,515
Refuse collection 176,810
Stormwater System 316,675
Total depreciation expense-business-type activities $ 2,903,000
F. Deferred Charges:
Deferred charges consist of the following:
Accumulated Unamortized
Cost Amortization Balance
Bond issues costs $ 127,454 $ 36,993 $ 90,461
Total deferred charges—business-
type activities $ 127,454 $ 36,993 $ 90,461
G. Leases:
Capital Leases - The City has lease agreements for financing the acquisition of rescue and other vehicles.
These lease agreements qualify as capital leases for accounting purposes and, therefore, have been
recorded at the present value of their future minimum lease payments as of the inception date.
The assets acquired through capital leases are as follows:
Governmental
Activities
Assets-
Machinery and
equipment $ 366,069
Less: accumulated
depreciation (93,883)
Total $ 272,186
41
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
The future minimum lease obligations and the net present value of these minimum lease payments as of
September 30,2013 were as follows:
Year Ending Governmental
30-Sep Activities
2014 $ 68,807
2015 68,807
2016 68,607
2017 68,607
2018 33,566
Total minimum lease payments 308,794
Less: amount representing
interest (20,878)
$ 287,916
H. 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 the
revenue bonds issued and outstanding at year-end is as follows:
Balance
Interest Rates September 30,
Business-Type Activities and Dates Maturity Original Amount 2013
Water and Sewer
Revenue Refunding Bonds- 3.40%
Series 2009 (4/1 &10/1) 10/1/2016 $7,945,000 $6,285,000 '-
Water and Sewer
Revenue Refunding Bonds- 2.18%
Series 2012 (4/1 &10/1) 10/1/2023 8,310,000 7,741,000
Total Revenue Bonds Outstanding $14 026 000
The 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 Bond resolution provides 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 I
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:
42 '
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
(c) Deposits to the reserve fund are required to make up any deficiency in its balance as
compared to the reserve equipment;
(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, 2013
are as follows:
Year Ending Business-Type Activities
September 30 Principal Interest
2014 $ 1,273,000 $ 368,499
2015 1,314,000 332,793
2016 1,349,000 295,985
2017 5,093,000 195,099
2018 724,000 105,032
2019-2023 3,865,000 280,065
2024 408,000 4,447
Total $ 14,026,000 $ 1,581,920
The Water and Sewer Revenue Refunding Bonds, Series 2009 were issued on November 24, 2009, in
the amount of$7,945,000 to refund the City's outstanding Water and Sewer Revenue Bonds, Series 1991
and Water and Sewer Revenue Refunding Bonds, Series 1993. The bond will have semi-annual
payments due on April 1 and October 1. The stated interest rate on the refunding revenue bond is 3.40%
and maturing on October 1, 2016. The new issue will reduce debt service payments for the City by
$3,340,233 with an economic gain of$1,082,825 or 11.719%.
The Water and Sewer Revenue Refunding Bonds, Series 2012 were issued on May 18, 2012, in the
amount of$8,310,000 to refund two of the City's outstanding State Revolving Fund Loans. The remaining
State Revolving Loans were paid off with surplus cash during the year. The new bond will have semi-
annual payments due on April 1 and October 1. The stated interest rate on the refunding revenue bond is
2.18% and maturing on October 1, 2023.
43
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
Notes Payable
The City issued the following revenue note in a prior year:
Guaranteed Entitlement
Revenue Note,Series 2010
Original amount issued $750,000
Issue date November 23,2010
Final maturity October 1,2030
Interest due April 1 and Oct 1
Interest rate Fixed—2.77%
The note is pledged by State Revenue Sharing monies received by the City and the proceeds were used to
construct fire station, number 55.
The City paid the principal payment due on October 1, 2014 in the amount of$30,000, prior to year end,
so the amount due for principal in 2014 is reported at zero. Remaining debt service requirements for this
revenue note using interest rate of 2.77% at September 30, 2013 are:
Year Ending Governmental Activities
September 30 Principal Interest
2014 $ . $ 9,530
2015 30,000 18.699
2016 35,000 17,846
2017 35,000 16,829
2018 35,000 15,860
2019-2023 190,000 64,170
2024-2028 220,000 35,639
2029-2031 145,000 6,169
Total $ 690,000 $ 184,742
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 was $5,056,567
and shall be paid in ten equal installments of $505,657 each year starting August 26, 2003, reduced to
$337,019 beginning in 2009. For the first five years, no interest accrued on the outstanding principal balance.
Starting August 26, 2007, interest began to accrue on the outstanding principal balance at an interest rate
equal to interest available from the State Board Administration (SBA). During 2009, the City extended the
maturity date 2 years to August 28, 2014.
Debt service requirements for the FIND note payable are as follows:
Year Ending Governmental Activities
September 30 Principal Interest
2014 $ 337,019 $ 775
During 2007, the City signed a limited general obligation note payable for$500,000 to fund the construction
of a new animal shelter. The note is secured by a limited pledge of ad valorem taxes. While the note is
outstanding, the City will levy ad valorem taxes, not to exceed .06 mills to pay principal and interest on the
note.Annual debt service requirements are as follows:
44
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
Year Ending Governmental Activities
September 30 Principal Interest
2014 $ 20,000 $ 13,650
2015 20,000 12,881
2016 20,000 12,112
2017 25,000 11,343
2018 25,000 10,382
2019-2023 140,000 36,912
2024-2026 105,000 8,075
Total $ 355,000 $ 105,355
During the year ended September 30, 2013, the City executed an agreement with the Florida Department of
Environmental Protection to borrow up to $6,438,083 at an interest rate of 1.72-1.84% through the State
Revolving Fund loan program,for the purpose of wastewater treatment replacement and renewal. Capitalized
interest added to the loan as of September 30, 2013 was $25,319. Repayment commences on December
15, 2014, is due semiannually thereafter on June 15 and December 15, each year until all amounts due
under the agreement have been fully paid. Current debt service requirements are as follows:
Year Ending Business-Type Activities
September 30 Principal Interest
2014 -
2015 269,765 117,225
2016 272,247 112,239
2017 274,752 107,160
2018 277,279 101,988
2019-2023 1,506,012 428,941
2024-2028 1,650,445 284,509
2029 152,542 10,645
Total $ 4,403,042 $ 1,162,707
During the year ended September 30, 2013, the City executed an agreement with a financial institution to
borrow$4,507,000 at an interest rate of 1.79%, for the purpose of refinancing the capital lease with Johnson
Controls, Inc. for water meters. Principal and interest payments are due quarterly on December 1, March 1,
June 1 and September 1. The note is secured by non-ad valorem revenues of the City. Debt service
requirements are as follows:
Year Ending Business-Type Activities
September 30 Principal Interest
2014 $ 493,000 $ 71,907
2015 533,000 62,787
2016 576,000 52,917
2017 622,000 42,265
2018 657,000 30,832
2019-2023 1,302,000 26,852
Total $ 4,183,000 $ 287,560
45
I
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
Changes in Long-Term Liabilities
Long-term liability activity for the year ended September 30, 2013 was as follows:
Beginning Ending Due Within
Balance Additions Reductions Balance One Year
Governmental Activities:
Notes payable
Guaranteed Entitlement Note,Series
2010 $ 750,000 $ - $ (60,000) $ 690,000 $ 30,000 -
FIND Note 674,037 - (337,018) 337,019 337,019
General Obligation note 375,000 - (20,000) 355,000 20,000
Total notes payable 1,799,037 - (417,018) 1,382,019 387,019
Capital leases
Ambulance 156,029 - (28,696) 127,333 29,898
Vehicles - 160,583 - 160,583 31,174
Other post employment benefits 305,662 66,247 - 371,909 -
Compensated absences 1,454,403 900,183 (770,992) 1,583,594 900,182
Total governmental activities long term
liabilities $3,715,131 $1,127,013 $ (1,216,706) $ 3,625,438 $ 1,348,273
Business-type Activities
Bonds payable
Revenue Bonds $15,180,000 $ - $ (1,154,000) $14,026,000 $ 1,273,000 "
Deferred loss on refunding (102,476) - 23,071 (79,405) -
Total bonds payable 15,077,524 - (1,130,929) 13,946,595 1,273,000
Notes payable
State revolving loan - 4,403,042 - 4,403,042 -
Lease refunding note - 4,507,000 (324,000) 4,183,000 493,000
Deferred loss on refinancing - (44,348) 4,065 (40,283) -
Capital Lease 4,527,471 - (4,527,471) - -
Other post employment benefits 155,060 34,120 - 189,180 -
Compensated absences 650,813 456,133 (448,138) 658,808 456,133
Total business-type activities long term
debt $20,410,868 $9,355,947 $ (6,426,473) $ 23,340,342 $2,222,133
Internal service funds predominately serve the governmental funds. Accordingly, $66,378 of
compensated absences and $12,774 of Net OPEB liability are included in the above governmental
activities amounts. Also, for the governmental activities, compensated absences and the net pension
obligation are generally liquidated by the General Fund.
46
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
I. Other Commitments and Contingencies
The City has entered into several agreements that are outstanding at September 30, 2013, which will
result in future financial obligation as follows:
Description Amount
Ford Transit Van-Police $ 23,604
Chevy Tahoe K9—Police 37,527
US 1 Sidewalk Design 165,338
10'"Street Park Design 3,608
WWTP Expansion 1,049,233
Lift Station#1 4,903
Hart Avenue Stormwater Design 4,928
Public Works Complex&Transfer Design 103,239
$ 1,392,380
V. Other Matters
A. 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. During 2013,
there were no significant reductions in insurance coverage from the previous year or any settlements in
excess of insurance coverage in the current year or the prior three years.
B. Other Postemployment Benefits:
Plan Description and Summary of Benefits - The City provides retirees with the option to purchase
health insurance from the City's single employer, experience rated health insurance plan (Plan) that
provides medical benefits to active and eligible retirees at the City's group rate as mandated by Florida
Statute 112.0801. This requirement creates an implicit rate subsidy benefit for the retirees' participation.
Retirees are required to pay the full amount of the health insurance premium during their eligibility period.
As of the valuation dated October 1, 2012, the Plan had approximately 170 active participants, 3 spouses,
and 5 retirees receiving benefits. The plan does not issue a separate publicly available financial report.
Transition Year - GASB Statement No. 45 was implemented prospectively resulting in a zero net OPEB
obligation at transition, which was October 1, 2008. There was neither an OPEB asset nor liability at
transition.
Funding Policy - The City has followed the pay-as-you-go funding policy, contributing only those
amounts necessary to provide for its portion of current year benefit costs and expenses plus any addition
to the reserve for accrued costs incurred but not yet reported, as determined as part of the insurance
contract. The contribution requirements of Plan members are established annually by the City. The City
pays any remaining required amounts after contributions of plan members are taken into account.
Currently, retired members pay the full premium associated with the coverage elected; no direct City
subsidy is applicable; however there is an implicit cost outlined below. Spouses and other dependents are
also eligible for coverage, and the member is responsible for payment of the applicable premiums.
State of Florida law prohibits the City from separately rating retirees and active employees. The City
therefore assigns both groups equal, blended-rate premiums. Although both groups are assigned the
same blended rate premiums, GAAP requires actuarial liabilities to be calculated using age-adjusted
premiums approximating claim costs for retirees separate from active members. The use of age-adjusted
premiums results in the full expected retiree obligation recognized in this disclosure.
47
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
Annual OPEB Cost and Net OPEB Obligation - The City's annual other postemployment benefit cost
(expense) is calculated based on the annual required contribution of the employer (ARC). The City has
elected to calculate the ARC and related information using the Entry Age Normal actuarial cost method.
The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover normal
costs each year and to amortize any unfunded actuarial liability (or funding excess) using a level
percentage of payroll method and closed amortization over a period not to exceed 30 years. Annual
requirements include a 4.5% discount rate, compounded annually, and based on assumptions that the
plan will be unfunded. The annual health care cost trend rate was assumed to decline gradually over the
next several years from 8.5% in 2013 to an ultimate rate of 4.5% on and after 2017. The economic rates
are based on an assumed inflation rate of 3% per annum.
The actuarial accrued liability (AAL) was determined as of September 30, 2013, based on the above
assumptions and cost method, and applied to member data current at October 1, 2012. Liabilities were
developed based on age adjusted costs for retirees currently receiving plan benefits as of October 1,
2012, with an AAL calculated to be $1,849,238, which is unfunded (or 0% funded). The annual covered
payroll is $7.2 million, resulting in an unfunded AAL of 25.8%. The actuarial calculations reflect a long-
term perspective using methods and assumptions that are designed to reduce short-term volatility in AAL
and actuarial value of assets. The Plan provisions affecting the valuation were those in effect on October
1, 2012.
OPEB GASB No. 45 results are not based on the assumption that all members terminate services as of
the valuation date, but rather on assumptions of future mortality, retirement, and termination.
2013
Fiscal Year
Valuation as
of 10/1/2012
Annual Required Contribution (ARC) $ 217,079
Interest on Net OPEB Obligation 20,732
Adjustment to ARC (20,089)
Annual OPEB Cost (Expense) 217,722
Less: Employer Contributions Made (117,354)
Increase in Net OPEB Obligation 100,368
Net OPEB Obligation at beginning of year 460,722
Net OPEB Obligation at end of year $ 561,090
In the Statement of Net Position, as of September 30, 2013, the City reports a Net OPEB obligation of
$371,909 in governmental activities and $189,181 in business-type activities.
The schedule of funding progress, presented as required supplementary information following the notes
to the financial statements, presents multi-year trend information about whether the actuarial value of plan
assets is increasing or decreasing over time relative to the actuarial accrued liability for benefits.
The City's annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net
OPEB obligation for the past three years was as follows:
Annual Percentage of Net
Year Ended OPEB City Annual OPEB OPEB
September 30, Cost Contributions Cost Contributed Obligation
2013 $ 217,722 $ 117,354 53.9% $ 561,090
2012 $ 195,528 $ 80,788 41.3% $ 460,722
2011 $ 188,807 $ 72,926 38.6% $ 345,982
48
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
C. Employee Defined Benefit Retirement Pension Plans:
The City maintains three separate single-employer, defined benefit pension plans for general employees,
police officers and firefighters, which are maintained as Pension Trust Funds and included as part of the
City's reporting entity. These pension plans do not issue stand-alone financial reports. These plans also
provide for disability and survivor benefits.
Separate boards of trustees independently govern each system. Assets may not be transferred from one
plan to another or used for any purpose other than to benefit each system's participants as defined in
their authorizing ordinances. Administrative expenses and fees attributable to each plan are deducted
from the plan assets. These funds are reported using the full accrual basis of accounting. The benefits
and refunds of each defined benefit plan are recognized when due and payable in accordance with the
terms of the plan.
Investments are reported at fair value. Short-term investments are reported at cost, which approximates
fair value. Securities traded on a national or international exchange are valued at the last reported sales
price at current exchange rates. Investments that do not have an established market are reported at
estimated fair value.
General Employees' Pension Fund - The General Employees' Pension Fund is a single employer
defined benefit retirement system and contains the assets of the General Employees' Pension Fund. The
General Employees' Pension Fund includes all full-time City employees, except police, firefighters and
City Manager.
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.
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.
With the October 1, 2012 valuation the Board of Trustees adopted changes to the mortality, salary scale,
normal and early retirement rates, and turnover rates assumptions. In addition, the Board of Trustees
changed the funding method from the aggregate actuarial cost method to the entry age normal actuarial
cost method. Starting for the year ending September 30, 2014, funding requirements are now based on a
dollar funding methodology as compared to the percentage of payroll methodology. Included in benefits
payment is $1,239,229 for the purchase of annuity contracts for the year ended September 30, 2013.
49
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
Police Officers' Retirement Trust Fund - The Police Officers' Retirement Trust Fund is a single
employer defined benefit retirement system established pursuant with Chapter 185, Florida 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 contributions, City contributions, state appropriations and income from
investment of accumulated funds. The City funds actuarial deficiencies, as determined by the state. The
investments of the fund are administered, managed and operated by its Board of Trustees. 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 service up to October 1, 1987, and 3% of that average multiplied by
years of actual service after October 1, 1987.
Included in benefits payment is $1,724,372 for the purchase of annuity contracts for the year ended
September 30, 2013.
Firefighters' Pension Fund - The Firefighters' Pension Fund is a single employer defined benefit
retirement system established pursuant with Chapter 175, Florida Statue 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.
With the October 1, 2012 valuation the Board of Trustees adopted changes to the salary scale, normal
retirement rates, disability rates, and turnover rates assumptions.
Current membership in the Employees' Pension Plans is comprised of the following as of the latest
actuarial valuation report:
General Police Fire
Group Employees Officers' Fighters'
Retirees and beneficiaries currently receiving benefits and terminated
employees entitled to benefits but not yet receiving them(vested) 107 31 6
Actively employed participants 12 25 27
Totals 119 56 33
Funding Policy - The City has traditionally contributed the annual required contribution (ARC) and thus
had never been required to report a net pension obligation (NPO). The State of Florida Department of
Management Services, Division of Retirement has required the City of Edgewater to change their
contribution method to a fixed percentage of actual payroll. This change in methodology will result in an
NPO or net pension asset(NPA) at year end. In accordance with GASB Statement No. 27, Accounting for
Pensions by State and Local Government Employers, the total NPA at year end was $348,892, the
cumulative net contribution in excess of the annual required contribution, is presented as an asset on the
City's entity-wide Statement of Net Position. In accordance with GAAP, the City recorded the approved
50
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
state police and firefighter pension contribution from insurance premium payments and excise tax in the
amount of $250,381 as an intergovernmental revenue and pension contribution expense in the General
Fund.
At September 30, 2013 the Police Officers plan has $113,625 of accumulated funding in the Funding
Standard Account, as determined by the actuary. The Funding Standard Account balance can be utilized
in future years to reduce the City's contributions into the Police Officers Retirement Trust Fund. In
addition, for the year ended September 30, 2013 the City did not utilize the Funding Standard Account to
meet the Annual Required Contribution.
The schedule of funding progress, presented as RSI following the notes to the financial statements,
presents multiyear trend information about whether the actuarial value of plan assets are increasing or
decreasing over time relative to the actuarial accrued liability for benefits.
The amounts legally required as of September 30, 2013 to be reserved for the general, police and
firefighter pension funds are$12,030,392, $7,382,096 and $8,426,103, respectively.
Annual Pension Cost and Annual Pension Obligation - The annual pension cost, net pension
obligation and required contribution for September 30, 2013, were determined as part of the latest
actuarial valuation of each plan, using the respective actuarial cost method for each plan. The City's
annual pension cost and net pension obligation based on the most recent actuarial valuation were as
follows:
General Police
Employee's Officers' Firefighters'
Pension Fund Pension Fund Pension Fund
Annual Required Contribution(ARC) $ 484,341 $ 762,743 $ 451,165
Interest on Net Pension Obligation(NPO) 2 (32,259) (8,743)
Adjustment to ARC (2) 56,632 12,930
Annual Pension Cost 484,341 787,116 455,352
City and State Contributions Made 484,341 593,502 451,165
Increase/(Decrease)in NPO - 193,614 4,187
NPO(NPA)beginning of year - (430,115) (116,578)
NPO (NPA)end of year $ - $ (236,501) $ (112,391)
51
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
Three Year Trend Information:
General Employee's Pension
Annual
Pension Percentage
Cost of APC Net Pension
Fiscal Year Ending (APC) Contributed Obligation
September 30,2012 484,341 100% -
September 30,2011 443,259 100% -
September 30,2010 358,254 100% -
Police Officers'Pension
Annual
Pension Percentage
Cost of APC Net Pension
Fiscal Year Ending (APC) Contributed Obligation
September 30,2012 787,116 75.40% (236,501)
September 30,2011 701,166 86.50% (430,115)
September 30,2010 629,164 95.50% (524,844)
Firefighters'Pension
Annual
Pension Percentage
Cost of APC Net Pension
Fiscal Year Ending (APC) Contributed Obligation
September 30,2012 455,352 98.10% (112,391)
September 30,2011 362,093 98.20% (116,578)
September 30,2010 360,815 98.10% (122,982)
As of October 1, 2012, the most recent actuarial valuation date, the General Employees' plan was 62.99
percent funded. The actuarial accrued liability for benefits was $17,138,842, and the actuarial value of
assets was $10,795,757, resulting in an unfunded actuarial accrued liability (UAAL) of $6,343,085. The
covered payroll (annual payroll of active employees covered by the plan) was $580,324, and the ratio of
the UAAL to the covered payroll was 1,093.02 percent.
As of October 1, 2012, the most recent actuarial valuation date, the Police Officers' plan was 54.98
percent funded. The actuarial accrued liability for benefits was $11,153,497, and the actuarial value of
assets was $6,132,725, resulting in an unfunded actuarial accrued liability (UAAL) of $5,020,772. The
covered payroll (annual payroll of active employees covered by the plan)was $1,117,545, and the ratio of
the UAAL to the covered payroll was 449.27 percent.
As of October 1, 2012, the most recent actuarial valuation date, the Firefighters' plan was 83.98 percent
funded. The actuarial accrued liability for benefits was $8,068,598, and the actuarial value of assets was
$6,776,342, resulting in an unfunded actuarial accrued liability (UAAL) of$1,292,256. The covered payroll
(annual payroll of active employees covered by the plan) was $1,528,795, and the ratio of the UAAL to
the covered payroll was 84.53 percent.
52
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
Description of Plan Benefits-All Plans
The benefit provisions and all other requirements of the employees' pension retirement systems are
established by Chapter 13 of the City's Code of Ordinances and comply with all applicable Florida State
Statutes. Notable points of the plans are summarized below. The Florida Constitution requires local
governments to make the actuarially determined contribution. The Florida Division of Retirement reviews
and approves each local government's actuarial report prior to it being appropriated for funding purposes.
The funding methods and determination of benefits payable are provided in various acts of the Florida
Legislature, which created the funds including subsequent amendments thereto.
Actuarial methods and significant assumptions
General Employees Police Officers Firefighters
Valuation date 10/1/2012 10/1/2012 10/1/2012
Actuarial cost method Entry Age Normal Frozen Entry Age Entry age Normal
Amortization method Level%of pay,Closed Level%of pay,Closed Level%of pay,Closed
Remaining amortization period 20 years 20 years 22 years
Asset valuation method 4-year smoothed market 4-year smoothed market 4-year smoothed market
Actuarial assumptions:
Investment rate of return 7.5% 7.5% 7.5%
Projected salary increases** 4.0% 6.0% 5.0%
**Includes inflation at 3.0% 3.0% 3.0%
Cost-of-living adjustments None None None
Individual Fiduciary Fund Statements
Individual statements of net position for the three plans included in the City of Edgewater fiduciary funds
are as follows:
CITY OF EDGEWATER,FLORIDA
Combining Statement of Fiduciary Net Position
Pension Trust Funds
September 30,2013
General
Employees Police Officers Firefighters
ASSETS
Investments,at fair value:
Cash and cash equivalents $ 27,095 $ 2,376 $ 3,381
Accrued income 48,332 30,869 13,009
Investments,at fair value
Money market funds 374,814 332,689 311,694
Certificates of deposit - - 49,683
Bonds 4,070,929 2,641,198 1,991,910
Equities - 3,327,279 6,066,023
Mutual fund—equities 7,607,612 1,057,077 -
Total assets 12,128,782 7,391,488 8,435,700
LIABILITIES
Deferred Contributions 98,390 9,392 9,597
NET POSITION
Held in trust for pension benefits $ 12,030,392 $ 7,382,096 $ 8,426,103
53
1
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
CITY OF EDGEWATER,FLORIDA
Combining Statement of Changes in Fiduciary Net Position
Pension Trust Funds
For the fiscal year ended September 30,2013
General
Employees Police Officers Firefighters
ADDITIONS
Contributions:
Employer $ 480,000 $ 753,286 $ 481,740
Employee 15,348 70,430 88,154
State of Florida - 121,375 129,006
Total contributions 495,348 945,091 698,900
Investment earnings:
Interest and dividends 61,100 116,726 154,801
Net increase/(decrease)in the fair value of investments 1,508,921 673,502 670,588
Less investment expenses (2,746) (15,084) (40,614)
Net investment earnings 1,567,275 775,144 784,775
Total Additions 2,062,623 1,720,235 1,483,675
DEDUCTIONS
Pension benefits 2,501,826 2,462,670 288,611
Administrative expenses 80,436 89,127 37,306
Total deductions 2,582,262 2,551,797 325,917
Change in net position (519,639) (831,562) 1,157,758
Net position-beginning of year 12,550,031 8,213,658 7,268,345
Net position-end of Year $ 12,030,392 $ 7,382,096 $ 8,426,103
D. Employee Defined Contribution Retirement Pension Plans:
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 Salem Trust. 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.
Employee participation is immediate upon hiring and are 100% vested after five years of employment.
Employees direct the investment of funds contributed to the plan on their behalf. Employer contributions
made during the year amounted to $475,854. The City Council has the authority to amend the Plan's
provisions including amending contribution requirements.
E. Deferred Compensation Plans:
The City offers its employees a choice of two deferred compensation plans created in accordance with
Internal Revenue Code Section 457; i.e., International City/County Management Association (ICMA). The
plans are available to all City employees and permit employees to defer a portion of their salary until
future years. Participation in either of the plans is optional. Deferred compensation withdrawals are not
available to employees until termination, retirement, death, or an unforeseeable emergency. In
accordance with current professional pronouncements, the City has not included such funds in its
financial statements.
54
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
F. Joint Venture
Communications Interlocal Agency.
On January 11, 2002, the cities of New Smyrna Beach, Port Orange and Edgewater entered into an
interlocal agreement to provide a consolidated dispatch communications and records system servicing
law enforcement, fire, rescue and emergency communications for each of the cities. This entity, known as
the Communications Interlocal Agency (CIA), was established pursuant to Florida Statutes, Section
163.01(7). The CI Agency operates as a public entity using the same fiscal year as the City of New
Smyrna Beach, ending on September 30th.
The CI 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 from the respective cities mentioned above. Operating guidelines,
procedures, designations and restrictions are determined by this governing body.
Substantially all costs of the CI Agency are allocated to Port Orange, New Smyrna Beach, and Edgewater
in the respective amounts of 44%, 33%, and 23%. The books and records are maintained using
accounting principles generally accepted in the United States of America. The City of Port Orange, as
agent, performs all cash and accounting transactions.
The financial statements of the joint venture can be obtained by contacting the Finance Director of the
City of Port Orange, Florida, at the following address:
Wayne Saunders, Finance Director
City of Port Orange
1000 City Center Circle
Port Orange, FL 32129
Summarized audited information of the Communications Interlocal Agency for the year ended September
30, 2013 is as follows:
Operating revenues $ -
Operating expenses (54,809)
Non-operating revenues 2,267
Net loss $ (52,542)
Total assets $ 307,290
Total liabilities $ -
Total net position $ 307,290
A summary of the changes in the City's investment in the Communications Interlocal Agency for the year
ended September 30, 2013 is as follows:
September 30, 2012, balance $ 242,278
Fiscal year 2013 activity (79,069)
September 30, 2013, balance $ 163,209
Effective September 30, 2011, the CIA was dissolved as the County of Volusia, Florida voted to go to a
centralized dispatch service for the entire County. The CIA is still determining the dissolution of assets
between the three cities, and the remaining assets are expected to be distributed during the year ended
September 30, 2014.
55
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
G. Contingencies:
The City has been involved in miscellaneous collections, lot cleaning, stormwater and other liens. In
addition, the City has numerous pending/threatened claims against it. In the opinion of City management
the loss if any, resulting from these actions will not have a material adverse affect on the financial
condition of the City.
Amounts received or receivable from grant agencies are subject to audit and adjustment by grantor
agencies, principally the federal and state government. Any disallowed claims, including amounts already
collected, may constitute a liability of the applicable funds. The amount, if any, of expenditures which may
be disallowed by the grantor cannot be determined at this time although the City expects such amounts, if
any, to be immaterial.
H. Recently Issued Pronouncements:
In March 2012, the Government Accounting Standards Board (GASB) issued GASB Statement
9 ( )
No. 65, Items Previously Reported as Assets and Liabilities. GASB 65 clarifies the appropriate
reporting of deferred outflows of resources and deferred inflows of resources to ensure
consistency in financial reporting. GASB Concepts Statement (CON) No. 4, Elements of
Financial Statements, specifies that recognition of deferred outflows and deferred inflows should
be limited to those instances specifically identified in authoritative GASB pronouncements.
Consequently, guidance was needed to determine which balances being reported as assets and
liabilities should actually be reported as deferred outflows of resources or deferred inflows of
resources, according to the definitions in CON 4. Based on those definitions, GASB 65
reclassifies certain items currently being reported as assets and liabilities as deferred outflows
of resources and deferred inflows of resources. In addition, GASB 65 recognizes certain items
currently being reported as assets and liabilities as outflows of resources and inflows of
resources. The requirements of GASB 65 are effective for fiscal year 2014. The implementation
GASB 65 will result in the removal of approximately $90,461 of unamortized bond issuance
costs and result in the reduction of investment in capital assets net assets in the Water/Sewer
fund.
In June 2012, the Government Accounting Standards Board (GASB) issued GASB 67, which
replaces the requirements of GASB Statement No. 25, Financial Reporting for Defined Benefit
Pension Plans and Note Disclosures for Defined Contribution Plans, and GASB Statement No.
50, Pension Disclosures, as they relate to pension plans that are administered through trusts or
similar arrangements meeting certain criteria. GASB 67 builds upon the existing framework for
financial reports of defined benefit pension plans, which includes a statement of fiduciary net
position (the amount held in a trust for paying retirement benefits) and a statement of changes
in fiduciary net position. GASB 67 enhances note disclosures and required supplementary
information for both defined benefit and defined contribution pension plans. GASB 67 also
requires the presentation of new information about annual money-weighted rates of return in the
notes to the financial statements and in 10-year required supplementary information schedules.
The provisions in GASB 67 are effective for financial statements for periods beginning after
June 15, 2013. Management is currently evaluating the impact of the adoption of this statement
on the City's financial statements.
56
City of Edgewater, Florida
Notes to the Financial Statements
September 30, 2013
In June 2012, the Government Accounting Standards Board (GASB) issued GASB 68, which
replaces the requirements of GASB Statement No. 27, Accounting for Pensions by State and
Local Governmental Employers, and GASB 50, as they relate to governments that provide
pensions through pension plans administered as trusts or similar arrangements that meet
certain criteria. GASB 68 requires governments providing defined benefit pensions to recognize
their long-term obligation for pension benefits as a liability for the first time, and to more
comprehensively and comparably measure the annual costs of pension benefits. GASB 68 also
enhances accountability and transparency through revised and new note disclosures and
required supplementary information. The provisions in GASB 68 are effective for fiscal years
beginning after June 15, 2014. Management is currently evaluating the impact of the adoption of
this statement on the City's financial statements.
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57
I
CITY OF EDGEWATER, FLORIDA
Required Supplementary Information(unaudited)
Schedules of Funding Progress
Other Post Employment Benefit Plan
Unfunded or Unfunded or
Actuarial Actuarial Actuarial (Assets in (Assets in Excess of)
Valuation Value of Accrued Liability Excess of) Funded Covered AAL as a Percentage
Date Assets (AAL)-Entry Age AAL Ratio Payroll of Covered Payroll
(a) (b) (b-a) (a/b) (c) ((b-a)/c)
10/1/2012 $ - $ 1,849,238 $ 1,849,238 0.00% $ 7,177,127 25.8%
10/2/2010 - 1,676,652 1,676,652 0.00% 5,765,693 29.1%
10/1/2008 - 3,009,113 3,009,113 0.00% 6,080,589 49.5%
The City implemented GASB Statement No.45 for the fiscal year ended September 30,2009.Information
for prior years is not available.
General Employee's Retirement Trust
Unfunded or Unfunded or
Actuarial Actuarial Actuarial (Assets in (Assets in Excess of)
Valuation Value of Accrued Liability Excess of) Funded Covered AAL as a Percentage
Date Assets (AAL)-Entry Age AAL Ratio Payroll of Covered Payroll
(a) (b) (b-a) (a/b) (c) ((b-a)/c)
10/1/2012 $ 10,795,757 $ 17,138,842 $ 6,343,085 62.99% $ 580,324 1093.02%
10/1/2011 12,227,558 17,289,981 5,062,423 70.72% 1,017,953 497.31%
10/1/2010 13,310,777 17,088,869 3,778,092 77.89% 1,077,877 350.51%
10/1/2009 13,876,405 16,842,925 2,966,520 82.39% 1,204,161 246.36%
10/1/2008 14,472,525 16,636,744 2,164,219 86.99% 1,254,441 172.52%
10/1/2007 14,130,355 17,505,616 3,375,261 80.72% 2,307,345 146.28%
10/1/2006 13,036,725 13,036,725 - 100.00% 2,621,289 0.00%
Police Officers Pension Trust
Actuarial Unfunded or Unfunded or
Actuarial Actuarial Accrued Liability (Assets in (Assets in Excess of)
Valuation Value of (AAL)--Frozen Excess of) Funded Covered AAL as a Percentage
Date Assets Entry Age AAL Ratio Payroll of Covered Payroll
(a) (b) (b-a) (a/b) (c) ((b-a)/c)
10/1/2012 $ 6,132,725 $ 11,153,497 $ 5,020,772 54.98% $ 1,117,545 449.27%
10/1/2011 5,828,463 11,013,027 5,184,564 52.92% 972,222 533.27%
10/1/2010 7,801,777 8,944,282 1,142,505 87.23% 1,063,774 107.40%
10/1/2009 7,980,169 9,081,117 1,100,948 87.88% 1,105,895 99.55%
10/1/2008 8,040,328 9,229,229 1,188,901 87.12% 1,032,166 115.19% -
10/1/2007 7,772,999 9,136,180 1,363,181 85.08% 1,222,818 111.48%
10/1/2006 7,062,840 8,476,559 1,413,719 83.32% 1,239,780 114.03%
w,
Firefighters Pension Trust
Unfunded or Unfunded or
Actuarial Actuarial Actuarial (Assets in (Assets in Excess of)
Valuation Value of Accrued Liability Excess of) Funded Covered AAL as a Percentage
Date Assets (AAL)--Entry Age AAL Ratio Payroll of Covered Payroll
(a) (b) (b-a) (a/b) (c) ((b-a)/c)
10/1/2012 $ 6,776,342 $ 8,068,598 $ 1,292,256 83.98% $ 1,528,795 84.53%
10/1/2011 5,513,147 7,319,117 1,805,970 75.33% 1,439,711 125.44%
10/1/2010 5,315,976 6,499,389 1,183,413 81.79% 1,475,291 80.22%
10/1/2009 4,977,603 5,652,886 675,283 88.05% 1,475,963 45.75%
10/1/2008 4,700,591 4,813,030 112,439 97.66% 1,556,068 7.23%
10/1/2007 4,004,108 4,557,499 553,391 87.86% 1,495,480 37.00% .4.
10/1/2006 3,280,579 3,786,476 505,897 86.64% 1,477,632 34.24%
58
CITY OF EDGEWATER, FLORIDA
Required Supplementary Information (unaudited)
Schedules of Contributions from the Employer and Other Contributing Entities
Other Post Employment Benefit Plan
Annual
Year Ended Required City Percentage
Sept 30, Contribution City Contribution Contribution
2013 $ 217,079 $ 117,354 54.1%
2012 194,676 80,788 41.5%
2011 187,837 72,926 38.8%
2010 236,130 116,928 49.5%
2009 225,651 114,752 50.9%
General Employee's Retirement Trust
Annual
Year Ended Required City Percentage
Sept 30, Contribution City Contribution Contribution
2013 $ 480,000 $ 480,000 100%
2012 484,341 484,341 100%
2011 443,259 443,259 100%
2010 358,255 358,255 100%
2009 746,270 746,270 100%
2008 746,270 746,270 100%
2007 639,794 639,794 100%
2006 580,701 580,701 100%
Police Officers Pension Trust
Annual
Year Ended Required City City State Percentage
Sept 30, Contribution Contribution Contribution* Contribution
2013 $ 874,661 $ 753,286 $ 121,375 100.00%
2012 762,743 1 471,463 122,039 77.81%
2011 673,391 2 547,752 125,639 100.00%
2010 600,715 3 475,560 125,156 100.00%
2009 474,810 407,647 131,228 113.49%
2008 474,810 474,810 126,189 126.58%
2007 378,127 258,902 222,837 127.40%
2006 378,127 258,902 119,225 100.00%
1)Includes$169,241 from the Funding Standard Accunt to meet
the annual required City contribution.
2)Includes$66,954 from the Funding Standard Account to meet
the annual required City contribution.
3)Includes$117,184 from the Funding Standard Account to meet
the annual required City contribution
Firefighters Pension Trust
Annual
Year Ended Required City City State Percentage
Sept 30, Contribution Contribution Contribution* Contribution
2013 $ 610,746 $ 481,740 $ 129,006 100.00%
2012 451,165 388,329 62,836 100.00%
2011 355,689 288,744 66,946 100.00%
2010 354,059 287,113 66,946 100.00%
2009 292,806 254,858 66,946 109.90%
2008 323,433 256,487 66,946 100.00%
2007 318,049 264,272 63,785 103.15%
2006 316,265 254,640 61,625 100.00%
*Frozen pursuant to Chapter 175 or 185, Florida Statutes
59
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CITY OF EDGEWATER, FLORIDA
Nonmajor Governmental Funds
September 30, 2013
SPECIAL REVENUE FUNDS are used to account for revenue derived from specific taxes or other
earmarked revenue sources (other than for major capital projects) that are restricted by law or
administrative action to expenditures for specified purposes.
Justice Assistance Grant Fund — This fund was established to receive revenues derived from money
received from the Department of Justice for the Victims Of Crime Act grant for the Victim Advocate
salaries and benefits.
Special Law Enforcement Trust Fund — This fund was established to receive revenues derived from
confiscated property obtained during the enforcement purposes, exclusive of salaries and vehicles. Such
purposes may include drug education programs such as DARE.
Transportation Impact Fees Fund — This fund was established to account for road impact fees collected
from new developments constructed in the City.
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 Fund —This fund was established to account for recreation impact fees collected
from new developments constructed in the City.
DEBT SERVICE FUNDS are established to account for the accumulation of resources for, and the
payment of, general long-term debt principal and interest.
Debt Service Fund — This fund was established to account for the payment of general long-term debt
principal and interest for the Station 55 replacement and Animal Shelter.
CAPITAL PROJECTS FUNDS are established to account for resources used for the acquisition and
construction of capital facilities by the City, except for those financed by proprietary 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.
61
CITY OF EDGEWATER, FLORIDA
Combining Balance Sheet
Nonmajor Governmental Funds
September 30, 2013
Special Revenue
Justice
Assistance Transportation
Grants SLETF Impact Police Impact
ASSETS
Cash $ 2,749 $ 6,860 $ 283,156 $ 148,629
Receivables-net - - 13 7
Due from other governments - - _ - -
Total assets $ 2,749 $ 6,860 $ 283,169 $ 148,636
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable $ - $ 1,155 $ - $ -
Total liabilities - 1,155 - -
Fund Balances
Spendable:
Restricted for
Public safety 2,749 5,705 - -
Debt service - - - -
Capital projects - - 283,169 148,636
Unassigned - - - -
Total fund balances 2,749 5,705 283,169 148,636
Total liabilities and fund balance $ 2,749 $ 6,860 $ 283,169 $ 148,636
62
Total Nonmajor
Recreation Governmental
Fire Impact Impact Debt Service Funds
$ 17,228 $ 48,904 $ 1,689 $ 509,215
1 2 - 23
38 38
$ 17,229 $ 48,906 $ 1,727 $ 509,276
$ $ $ - $ 1,155
1,155
8,454
1,727 1,727
17,229 48,906 - 497,940
17,229 48,906 1,727 508,121
$ 17,229 $ 48,906 $ 1,727 $ 509,276
63
I
CITY OF EDGEWATER, FLORIDA
Combining Statement of Revenues, Expenditures, and
Changes in Fund Balances
Nonmajor Governmental Funds
For the Fiscal Year Ended September 30, 2013
Special Revenue
Justice
Assistance Transportation Police
Grants SLETF Impact Impact Fire Impact
REVENUES
Taxes:
Property $ - $ - $ - $ - $ -
Intergovernmental 3,303 - - - -
Fines and forfeitures - 1,200 - - -
Investment earnings - 2 30 16 2
Impact fees - - 26,776 2,512 4,982
Total revenues 3,303 1,202 26,806 2,528 4,984
EXPENDITURES
Current:
Public safety 3,291 37,505 - - -
Debt Service:
Principal - - - - -
Interest - - - - -
Total expenditures 3,291 37,505 - - -
Excess(deficiency)of
revenues over(under)
expenditures 12 (36,303) 26,806 2,528 4,984
OTHER FINANCING SOURCES(USES)
Transfers out - - - - -
Total other financing sources(uses) - - - - -
Net change in fund balances 12 (36,303) 26,806 2,528 4,984
Beginning fund balances 2,737 42,008 256,363 146,108 12,245
Ending fund balances(deficit) $ 2,749 $ 5,705 $ 283,169 $ 148,636 $ 17,229
64
Total Nonmajor
Recreation Governmental
Impact Debt Service Funds
$ - $ 35,088 $ 35,088
- - 3,303
- - 1,200
7 1 58
9,866 - 44,136
9,873 35,089 83,785
- - 40,796
- 20,000 20,000
- 14,419 14,419
- 34,419 75,215
9,873 670 8,570
(130,000) - (130,000)
(130,000) - (130,000)
(120,127) 670 (121,430)
169,033 1,057 629,551
$ 48,906 $ 1,727 $ 508,121
65
I
CITY OF EDGEWATER, FLORIDA
Schedule of Revenues, Expenditures, and
Changes in Fund Balances--Budget and Actual
Annually-Budgeted Nonmajor Special Revenue Funds
For the Fiscal Year Ended September 30, 2013
Special Revenue
Justice Assistance Grants SLETF
Budgeted Amounts Variance Budgeted Amounts Variance
with Final with Final
Budget- Budget-
Actual Positive Actual Positive
Original Final Amounts (Negative) Original Final Amounts (Negative)
REVENUES
Intergovernmental $ 5,000 $ 5,000 $ 3,303 $ (1,697) $ - $ - $ - $ -
Fines and forfeitures - - - - 3,000 3,000 1,200 (1,800)
Investment earnings - - - - - - 2 2
Impact fees - - - - - - - -
Total revenues 5,000 5,000 3,303 (1,697) 3,000 3,000 1,202 (1,798)
EXPENDITURES
Current:
Public safety _ 5,000 _ 5,000 3,291 1,709 40,000 40,000 37,505 2,495
Total expenditures _ 5,000 5,000 3,291 1,709 40,000 40,000 37,505 2,495
Excess(deficiency)of revenues
over(under)expenditures - - 12 12 (37,000) (37,000) (36,303) 697
OTHER FINANCING SOURCES(USES)
Transfers in - - - - - - - -
Transfers out - - - - - - - -
Total other financing sources(uses) - - - - - - - -
Net change in fund balances - - 12 12 (37,000) (37,000) (36,303) 697
Beginning fund balances 2,737 2,737 2,737 - 42,008 42,008 42,008 -
Ending fund balances(deficit) $ 2,737 $ 2,737 $ 2,749 $ 12 $ 5,008 $ 5,008 $ 5,705 $ 697
66
CITY OF EDGEWATER, FLORIDA
Schedule of Revenues, Expenditures, and
Changes in Fund Balances--Budget and Actual--
Annually-Budgeted Nonmajor Special Revenue Funds (continued)
For the Fiscal Year Ended September 30, 2013
Special Revenue
Transportation Impact Police Impact
Budgeted Amounts Variance Budgeted Amounts Variance
with Final with Final
Budget- Budget-
Actual Positive Actual Positive
Original Final Amounts (Negative) Original Final Amounts (Negative)
REVENUES
Intergovernmental $ - $ - $ - $ - $ - $ - $ - $ -
Fines and forfeitures - - - - - - - -
Investment earnings - - 30 30 - - 16 16
Impact fees 20,500 28,000 26,776 (1,224) 2,500 2,500 2,512 12
Total revenues 20,500 28,000 26,806 (1,194) 2,500 2,500 2,528 28
EXPENDITURES
Current:
Public safety - - - - - - - -
Total expenditures - - - - - - - -
. Excess(deficiency)of revenues
over(under)expenditures 20,500 28,000 26,806 (1,194) 2,500 2,500 2,528 28
OTHER FINANCING SOURCES(USES)
Transfers in - - - - - - - -
Transfers out - - - - - - - -
Total other financing sources(uses) - - - - - - - -
.e.
Net change in fund balances 20.500 28,000 26,806 (1,194) 2,500 2,500 2,528 28
Beginning fund balances 256,363 256,363 256,363 - 146,108 146,108 146,108 -
Ending fund balances(deficit) $276.863 $284,363 $283,169 $ (1,194) $148,608 $148,608 $148,636 $ 28
67
CITY OF EDGEWATER, FLORIDA
Schedule of Revenues, Expenditures, and
Changes in Fund Balances--Budget and Actual--
Annually-Budgeted Nonmajor Special Revenue Funds(continued)
For the Fiscal Year Ended September 30, 2013
Special Revenue
Fire Impact Recreation Impact
Budgeted Amounts Variance Budgeted Amounts Variance
with Final with Final
Budget- Budget-
Actual Positive Actual Positive
Original Final Amounts (Negative) Original Final Amounts (Negative)
REVENUES
Intergovernmental $ - $ - $ - $ - $ - $ - $ - $ -
Fines and forfeitures - - - - - - - -
Investment earnings - - 2 2 - - 7 7
Impact fees 5,000 5,000 4,982 (18) 5,000 5,000 _ 9,866 4,866
Total revenues 5,000 5,000 4,984 (16) 5,000 5,000 9,873 4,873
EXPENDITURES
Current:
Public safety - - - - - - - -
Total expenditures - - - - - - - -
Excess(deficiency)of revenues
over(under)expenditures 5,000 5,000 4,984 (16) 5,000 5,000 9,873 4,873
OTHER FINANCING SOURCES(USES)
Transfers in - - - - - - - -
Transfers out - - - - (130,000) (130,000) (130,000) -
Total other financing sources(uses) - - - - (130,000) (130,000) (130,000) -
Net change in fund balances 5,000 5,000 4,984 (16) (125,000) (125,000) (120,127) 4,873
Beginning fund balances 12,245 12,245 12,245 - 169,033 169,033 169,033 -
Ending fund balances(deficit) $ 17,245 $ 17,245 $ 17,229 $ (16) $ 44,033 $ 44,033 $ 48,906 $ 4,873
68
CITY OF EDGEWATER, FLORIDA
Schedule of Revenues, Expenditures, and
Changes in Fund Balances--Budget and Actual--
Annually-Budgeted Nonmajor Special Revenue Funds(continued)
For the Fiscal Year Ended September 30, 2013
Total
Budgeted Amounts Variance
with Final
Budget-
Actual Positive
Original Final Amounts (Negative)
REVENUES
Intergovernmental $ 5,000 $ 5,000 $ 3,303 $ (1,697)
Fines and forfeitures 3,000 3,000 1,200 (1,800)
Investment earnings - - 57 57
Impact fees 33,000 _ 40,500 44,136 3,636
Total revenues 41,000 48,500 48,696 196
EXPENDITURES
Current:
Public safety 45,000 45,000 40,796 4,204
Total expenditures 45,000 45,000 40,796 4,204
Excess(deficiency)of revenues
over(under)expenditures (4,000) 3,500 7,900 4,400
OTHER FINANCING SOURCES(USES)
Transfers in - - - -
Transfers out (130,000) (130,000) (130,000) -
Total other financing sources(uses) (130,000) (130,000) (130,000) -
Net change in fund balances (134,000) (126,500) (122,100) 4,400
Beginning fund balances 628,494 628,494 628,494 -
Ending fund balances(deficit) $ 494,494 $ 501,994 $ 506,394 $ 4,400
•
69
CITY OF EDGEWATER, FLORIDA
Schedule of Revenues, Expenditures, and
Changes in Fund Balances--Budget and Actual
Annually-Budgeted Nonmajor Debt Service Funds
For the Fiscal Year Ended September 30, 2013
Variance with
Budgeted Amounts Final Budget-
Actual Positive
Original Final Amounts (Negative)
REVENUES
Taxes:
Property $ 34,464 $ 34,464 $ 35,088 $ 624
Investment earnings - - 1 1
Total revenues 34,464 34,464 35,089 625
EXPENDITURES
Debt Service:
Principal 20,000 20,000 20,000 -
Interest 14,419 14,419 14,419 -
Total expenditures 34,419 34,419 34,419 -
Net change in fund balances 45 45 670 625
Beginning fund balances 1,057 1,057 1,057 -
Ending fund balances $ 1,102 $ 1,102 $ 1,727 $ 625
Iu
70
CITY OF EDGEWATER, FLORIDA
Schedule of Revenues, Expenditures,and
Changes in Fund Balances--Budget and Actual
Annually- Budgeted Major Capital Projects Funds
For the Fiscal Year Ended September 30, 2013
General Construction
Budgeted Amounts Variance with
Final Budget-
Positive
(Negative)
Actual
Original Final Amounts
REVENUES
Intergovernmental $ 74,939 $ 623,240 $ 441,752 $ (181,488)
Investment earnings 100 100 69 (31)
Total revenues 75,039 623,340 441,821 (181,519)
EXPENDITURES
Capital outlay 644,033 1,300,000 1,053,679 246,321
Other Services&Charges - - 6,221 (6,221)
Total expenditures 644,033 1,300,000 1,059,900 240,100
Excess(deficiency)of revenues
over(under)expenditures (568,994) (676,660) (618,079) 58,581
OTHER FINANCING SOURCES(USES)
Transfers in 568,994 676,660 676,660 -
Total other financing sources(uses) 568,994 676,660 676,660 -
Net change in fund balance - - 58,581 58,581
Beginning fund balances 82,529 82,529 82,529 -
Ending fund balances $ 82,529 $ 82,529 $ 141,110 $ 58,581
71
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aft
CITY OF EDGEWATER, FLORIDA
Internal Service Funds
September 30, 2013
INTERNAL SERVICE FUNDS are used to account for the financing of centralized services to City
departments on a cost-reimbursement basis (including depreciation).
Management Information Systems (MIS) — To account for data processing operations and the cost of
computer services used by other City departments.
Fleet — To account for the cost of operating a maintenance facility for automotive equipment used by
other City departments/divisions.
Loss Fund—To account for the general liability and property insurances of the City.
Fully Insured—To account for the health, dental and life insurance of the City's employees and retirees.
Workers Comp—To account for the workers compensation insurance of the City.
73
CITY OF EDGEWATER, FLORIDA
Combining Statement of Net Position
Internal Service Funds
September 30, 2013
Loss Fully Workers
MIS FLEET Fund Insured Comp Total
ASSETS
Current assets:
Cash $ 38,483 $ 71,184 $ 14,680 $ 85,786 $ 659 $ 210,792
Inventories - 20,361 - - - 20,361
Total current assets 38,483 91,545 14,680 85,786 659 231,153
Noncurrent assets:
Capital assets:
Buildings and improvements 60,684 - - - - 60,684
Machinery and equipment 39,447 48,739 - - - 88,186
Less accumulated depreciation (27,112) (30,840) - - - (57,952)
Total capital assets(net of
accumulated depreciation) 73,019 17,899 - - - 90,918
Total noncurrent assets 73,019 17,899 - - - 90,918
Total assets 111,502 109,444 14,680 85,786 659 322,071
LIABILITIES
Current liabilities:
Accounts payable 1,611 283 - 170,278 2,130 174,302
Accrued liabilities 6,399 6,399 - - - 12,798
Compensated absences 15,613 12,985 - - - 28,598
Total current liabilities 23,623 19,667 - 170,278 2,130 215,698
Noncurrent liabilities:
Compensated absences 24,554 13,226 - - - 37,780
OPEB obligation 6,163 6,611 - - - 12,774
Total noncurrent liabilities 30,717 19,837 - - - 50,554
Total liabilities 54,340 39,504 - 170,278 2,130 266,252
NET POSITION
Invested in capital assets 73,019 17,899 - - - 90,918
Unrestricted (15,857) 52,041 14,680 (84,492) (1,471) (35,099)
Total net position $ 57,162 $ 69,940 $ 14,680 $ (84,492) $ (1,471) $ 55,819
74
CITY OF EDGEWATER, FLORIDA
Combining Statement of Revenues, Expenses, and
Changes in Fund Net Position
Internal Service Funds
For the Fiscal Year Ended September 30, 2013
Loss Fully Workers
MIS FLEET Fund Insured Comp Total
Operating revenues:
Billings to City departments $ 336,560 $ 821,668 $ 371,707 $ 2,016,247 $ 215,423 $ 3,761,605
Operating expenses:
Salaries and employee benefits 165,941 158,038 - 2,035,151 220,083 2,579,213
Supplies and materials 50,037 431,767 - - - 481,804
Contract services 130,312 178 - - - 130,490
Other services and charges 46,224 233,961 357,027 - - 637,212
Depreciation 8,574 4,682 - - - 13,256
Total operating expenses 401,088 828,626 357,027 2,035,151 220,083 3,841,975
Operating income(loss) (64,528) (6,958) 14,680 (18,904) (4,660) (80,370)
Income(loss)before
contributions and transfers (64,528) (6,958) 14,680 (18,904) (4,660) (80,370)
Transfers in 156,702 46,869 - - - 203,571
Transfers out - - - (160,671) - (160,671)
Change in net position 92,174 39,911 14,680 (179,575) (4,660) (37,470)
Total net position-beginning (35,012) 30,029 - 95,083 3,189 93,289
Total net position-ending $ 57,162 $ 69,940 $ 14,680 $ (84,492) $ (1,471) $ 55,819
75
CITY OF EDGEWATER,FLORIDA
Combining Statement of Cash Flows
Internal Service Funds
For the Fiscal Year Ended September 30,2013
Loss Fully Workers
MIS FLEET Fund Insured Comp Total
Cash flows from operating activities: ..
Receipts-customers and users $ 336,560 $ 821,668 $ 371,707 $ 2,016,494 $ 218,612 $ 3,765,041
Payments-suppliers (229,839) (665,999) (357,027) (2,019,630) (217,953) (3,490,448)
Payments-employees (160,559) (150,727) - - - (311,286)
Net cash provided(used)by operating activities (53,838) 4,942 14,680 (3,136) 659 (36,693) "'
Cash flows from noncapital financing activities:
Cash received from(paid to)other funds 156,702 46,869 - (160,671) - 42,900
Cash flows from capital and related financing activities:
Acquisition and construction of capital assets (74,708) (15,851) - - - (90,559)
Net increase(decrease)in cash and cash w..
equivalents 28,156 35,960 14,680 (163,807) 659 (84,352)
Beginning cash and cash equivalents 10,327 35,224 - 249,593 - 295,144
Ending cash and cash equivalents $ 38,483 $ 71,184 $ 14,680 $ 85,786 $ 659 $ 210,792
Reconciliation of operating income(loss)to net cash provided ..
(used)by operating activities:
Operating income(loss) $ (64,528) $ (6,958) $ 14,680 $ (18,904) $ (4,660) $ (80,370)
Adjustments to reconcile operating income(loss)to net
cash provided(used)by operating activities:
Depreciation and amortization 8,574 4,682 - - - 13,256
(Increase)decrease in assets:
Receivables-net - - - 247 3,189 3,436
Inventories - (172) - 7,410 - 7,238 .
Increase(decrease)in liabilities:
Accounts payable (3,266) 79 - 8,111 2,130 7,054
Accrued liabilities 272 679 - - - 951
OPEB obligation 1,435 1,312 - - - 2,747 .v
Compensated absences 3,675 5,320 - - - 8,995
Total adjustments 10,690 11,900 - 15,768 5,319 43,677
Net cash provided(used)by operating activities $ (53,838) $ 4,942 $ 14,680 $ (3,136) $ 659 $ (36,693)
76
CITY OF EDGEWATER, FLORIDA
Other Supplemental Schedules
September 30, 2013
Fiduciary Funds—Pension trust Funds
Police, Firefighter and General Employees' Pension Funds — These funds are used to account for the
accumulation of resources to be used for retirement annuity payments at the appropriate amounts and
times in the future. Resources are contributed by employees at a rate fixed by law and by the City and
the State at amounts determined by an annual actuarial study.
77
CITY OF EDGEWATER, FLORIDA
Combining Statement of Fiduciary Net Position
Pension Trust Funds
September 30, 2013
General
Employees Police Officers Firefighters Total ..
ASSETS
Cash and cash equivalents $ 27,095 $ 2,376 $ 3,381 $ 32,852
Accrued income 48,332 30,869 13,009 92,210
Investments,at fair value:
Money market funds 374,814 332,689 311,694 1,019,197
Certificates of deposit - - 49,683 49,683
Bonds
US Treasury notes 268,999 196,258 87,400 552,657
GNMA 622,327 373,396 50,032 1,045,755
Municipal bonds 516,822 343,038 191,686 1,051,546
Corporate bonds 2,662,781 1,728,506 1,662,792 6,054,079
Equities - 3,327,279 6,066,023 9,393,302
Mutual fund-equities 7,607,612 1,057,077 - 8,664,689
Total assets 12,128,782 7,391,488 8,435,700 27,955,970
LIABILITIES
Deferred contributions 98,390 9,392 9,597 117,379
Total liabilities 98,390 9,392 9,597 117,379
NET POSITION
Held in trust for pension benefits $ 12,030,392 $ 7,382,096 $ 8,426,103 $ 27,838,591
78
CITY OF EDGEWATER, FLORIDA
Combining Statement of Changes in Fiduciary Net Position
Pension Trust Funds
For the Fiscal Year Ended September 30,2013
General Police
Employees Officers Firefighters Total
ADDITIONS
Contributions:
Employer $ 480,000 $ 753,286 $ 481,740 $ 1,715,026
Employee 15,348 70,430 88,154 173,932
State of Florida - 121,375 129,006 250,381
Total contributions 495,348 945,091 698,900 2,139,339
Investment earnings(loss):
Interest and dividends 61,100 116,726 154,801 332,627
Net increase in the fair value of investments 1,508,921 673,502 670,588 2,853,011
Total investment earnings 1,570,021 790,228 825,389 3,185,638
Less investment expenses (2,746) (15,084) (40,614) (58,444)
Net investment earnings(loss) 1,567,275 775,144 784,775 3,127,194
Total Additions 2,062,623 1,720,235 1,483,675 5,266,533
DEDUCTIONS
Pension benefits 2,501,826 2,462,670 288,611 5,253,107
Administrative expenses 80,436 89,127 37,306 206,869
Total deductions 2,582,262 2,551,797 325,917 5,459,976
Change in net position (519,639) (831,562) 1,157,758 (193,443)
Net position-beginning 12,550,031 8,213,658 7,268,345 28,032,034
Net position-ending $ 12,030,392 $ 7,382,096 $ 8,426,103 $ 27,838,591
79
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80
CITY OF EDGEWATER, FLORIDA
Statistical Secton
This part of the City of Edgewater, Florida's Comprehensive Annual Financial Report presents detailed
information as a context for understanding what the information in the financial statements, note
disclosures, and required supplementary information says about the City's overall financial health and is
unaudited.
Contents Page(s)
Financial Trends
These schedules contain trend information to help the reader understand how the City's
financial performance and well-being have changed over time.
82-86
Revenue Capacity
These schedules contain information to help the reader assess the City's most
significant local revenue source, the property tax, and the municipal sales tax. 87-91
Debt Capacity
These schedules present information to help the reader assess the affordability of the
City's current levels of outstanding debt and the City's ability to issue additional debt in
the future. 92-97
Demographic and Economic Information
These schedules offer economic and demographic indicators to help the reader
understand the environment within which the City's financial activities take place. 98-99
Operating Information
These schedules contain service and infrastructure data to help the reader understand
how the information in the City's financial report relates to the services the City provides
and the activities it performs. 100-102
Sources: Unless otherwise noted, the information in these schedules is derived from the
Comprehensive Annual Financial Report for the relevant fiscal year.
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86
CITY OF EDGEWATER, FLORIDA
Tax Revenues by Source of Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
Fiscal Year Ended Utility and franchise
September 30 Property Taxes taxes Total
2004 $ 3,884,932 $ 2,615,188 $ 6,500,120
2005 4,125,604 2,721,040 6,846,644
2006 5,045,677 3,098,230 8,143,907
2007 5,983,622 3,134,569 9,118,191
2008 6,053,935 2,822,644 8,876,579
2009 5,638,194 3,109,453 8,747,647
2010 5,083,616 3,076,195 8,159,811
2011 4,459,591 3,047,731 7,507,322
2012 3,669,228 2,947,266 6,616,494
2013 3,763,456 3,051,649 6,815,105
87
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88
CITY OF EDGEWATER, FLORIDA
Property Tax Rates
Direct and Overlapping Governments
Last Ten Fiscal Years
City of Debt Total Volusia
Fiscal Edgewater Service Direct County" School District Grand
Year Operating Millage Millage Rate Millage Millage Other(2) Total
2004 6.9500 0.0000 6.9500 8.7620 8.6990 0.5910 25.0020
2005 6.4500 0.0000 6.4500 8.8820 8.5170 0.5910 24.4400
2006 6.4500 0.0600 6.5100 7.7210 8.2590 0.5910 23.0810
2007 5.7000 0.0317 5.7317 5.3235 7.6850 2.7886 21.5288
2008 5.2000 0.0271 5.2271 4.8819 7.4670 2.6866 20.2626
2009 5.9000 0.0330 5.9330 5.4037 7.4590 3.5865 22.3823
2010 6.3600 0.0382 6.3982 6.4233 8.2370 3.7932 24.8517
2011 6.5910 0.0475 6.6385 6.3025 8.2370 4.0012 25.1792
2012 6.4700 0.0604 6.5304 6.7791 8.0630 3.9682 25.3407
2013 6.5000 0.0612 6.5612 6.8809 7.8880 3.6967 25.0268
(1) Millage includes General Fund, Southeast Volusia Hospital District
(2) Inlet and Port Authority, Florida Inland Navigation District and St. Johns River Water
Management District, Mosquito Control, and Hospital Operating
89
CITY OF EDGEWATER, FLORIDA
Principal Taxpayers
Current year and ten years ago
2013 2004
Real Percentage Real Percentage
Property of Total Property of Total
Assessed Assessed Assessed Assessed
Taxpayer Valuation Rank Valuation Valuation Rank Valuation
Florida Power&Light Company $ 14,993,832 1 2.54% $ 10,631,694 1 1.09%
R. J. Dougherty Associates Inc. 5,944,337 2 1.01%
Bright House Networks LLC 3,490,519 3 0.59%
Carder James C TR 3,307,988 4 0.56% 2,217,597 9 0.23% —
Revenue Properties Florida 3,289,478 5 0.56%
3050 Holdings LLC 3,145,155 6 0.53%
Edgewater Power Boats LLC 2,906,995 7 0.49%
Holly Investments LTD 2,669,209 8 0.45%
Transcapital Bank 2,637,047 9 0.45%
Bellsouth Telecommunication LLC 2,589,732 10 0.44% 3,700,860 3 0.38%
Coronado Paint Company, Inc - - 7,192,189 2 0.74%
Edgewater Commons - - 3,490,379 4 0.36%
Laramie Florida Shores, LP - - 2,897,412 5 0.30%
Twean Subsidiary, LLC - - 2,698,480 6 0.28% .a,
Sea Edge Partners, LLC - - 2,655,698 7 0.27%
Bel Aire Investments, Inc - - 2,397,000 8 0.25%
Florida East Coast Railway Company - - 1,893,608 10 0.19%
$ 44,974,292 7.62% $ 39,774,917 4.09%
Total Assessed Valuation $ 590,466,100 $974,165,071
Source: Volusia County Property Appraiser's Office&2004 City of Edgewater CAFR
90
CITY OF EDGEWATER, FLORIDA
Property Tax Levies And Collections
Last Ten Fiscal Years
Percent of Percent of
Total Current Current Tax Delinquent Total Total Tax
Fiscal Tax Tax Collections Tax Tax Collections
Year Levy Collections To Tax Levy Collections Collections To Tax Levy
2004 $ 4,014,168 $ 3,863,278 96.24 % $ 10,563 $ 3,873,841 96.50 %
2005 4,283,690 4,115,041 96.06 % 5,140 4,120,181 96.18 %
2006 5,243,485 5,040,537 96.13 % 17,219 5,057,756 96.46 %
2007 6,209,694 5,933,287 95.55 % 218,300 6,151,587 99.06
2008 6,219,068 5,835,665 93.84 % - 5,835,665 93.84 %
2009 5,822,971 5,611,299 96.36 % 26,895 5,638,194 96.83 %
2010 5,230,103 5,035,560 96.28 % 17,704 5,053,264 96.62 %
2011 4,515,489 4,343,936 96.20 % 83,812 4,427,748 98.06 %
2012 3,752,808 3,625,224 96.60 % 10,100 3,635,324 96.87 %
2013 3,836,165 3,558,179 92.75 % 170,189 3,728,368 97.19 %
Source: Volusia County Property Appraiser and Tax Collector
91
CITY OF EDGEWATER, FLORIDA
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
Governmental Activities
Special General Capital
Fiscal Notes Assessment Obligation Improvement Capital Line Notes
Year Payable Notes Note Revenue Bonds Leases of Credit Payable
2004 $ 6,331,253 $4,628,163 $ - $ - $ 452,820 $ - $7,039,543
2005 5,571,596 3,954,514 - - 331,123 - 6,147,017
2006 4,811,939 3,244,502 470,000 - 357,544 - 5,239,457
2007 4,052,282 2,874,549 455,000 - 224,579 12,500 4,472,504
2008 3,292,112 2,106,625 440,000 - 181,415 50,000 3,541,000
2009 2,701,092 1,297,442 425,000 - 225,466 - 2,592,437
2010 2,110,073 - 410,000 - 388,424 - 1,542,000
2011 2,269,055 - 395,000 - 183,569 - 1,028,000
2012 1,424,037 - 375,000 - 156,029 - -
2013 1,027,019 - 355,000 - 287,916 - 4,142,717
Note-1: Details regarding the City's outstanding debt can be found in the notes to the financial statements. .
Note-2: Net of un-amortized discount and deferred amount refunding.
(1) See Demographic and Economic Statistics for personal income and population data.
•
92
Business-Type Activities
State Percentage
Capital Revolving Revenue Line of Personal Per
Leases Loan Bonds of Credit Total Income(1) Capita(1)
$ 395,952 $14,574,225 $ 11,426,212 $ - $ 44,848,168 8.01% 2,173
6,544,290 13,298,345 11,011,773 - 46,858,658 7.81% 2,215
6,750,820 11,975,560 10,660,000 - 43,509,822 6.91% 2,017 I
6,391,335 10,604,143 10,215,000 37,500 39,339,392 6.00% 1,825
5,971,878 9,182,304 10,146,086 - 34,911,420 5.04% 1,604
5,548,388 8,137,963 9,679,987 - 30,607,775 5.70% 1,431
_ 5,258,430 8,388,828 7,814,973 - 25,912,728 4.72% 1,233
4,881,594 8,582,920 7,331,611 - 24,671,749 5.70% 1,181
4,527,471 - 15,077,524 - 21,560,061 5.10% 1,038
- 4,403,042 13,946,595 - 24,162,289 5.45% 1,165
93
CITY OF EDGEWATER, FLORIDA
Ratios of General Bonded Debt Outstanding
Last Ten Fiscal Years
General Bonded Debt Outstanding
Percentage of Net
Estimated General Actual Taxable Bonded
Fiscal Actual Obligation Value of Debt Per
Year Population Taxable Value Bonded Debt Property Capita
2004 20,637 $ 577,578,094 $ - - -
2005 21,156 664,137,932 - - -
2006 21,572 812,943,450 470,000 0.058% 21.79
2007 21,558 1,089,419,939 455,000 0.042% 21.11
2008 21,770 1,195,974,542 440,000 0.037% 20.21
2009 21,394 981,617,652 425,000 0.043% 19.87
2010 21,017 822,343,254 410,000 0.050% 19.51
2011 20,885 688,838,957 395,000 0.057% 18.91
2012 20,775 580,032,073 375,000 0.065% 18.05
2013 20,737 590,466,100 355,000 0.060% 17.12
94
CITY OF EDGEWATER, FLORIDA
Direct and Overlapping Debt
Net General Percentage City of
Obligation Applicable to Edgewater
Debt the City of Share of
Governmental Unit Outstanding Edgewater Debt
Volusia County $ 25,430,000 2.45% $ 623,035
Volusia County School District - 0% -
Subtotal Overlapping Debt 25,430,000 2.45% 623,035
City Direct Debt 1,669,932 100% 1,669,932
Total Direct and Overlapping Debt $ 27,099,932 $ 2,292,967
Note: The county-wide debt amount is comprised of$25,430,000 of the County of Volusia's
Limited Tax general obligation bonds.
The County's debt is overlapping to the City's in relation to its taxable property value
compared to the County's as a whole. The City's general obligation debt is listed above and
is direct debt to the City and underlapping to the County.
Source: Volusia County
95
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CITY OF EDGEWATER, FLORIDA
Pledged-Revenue Coverage
Last Ten Fiscal Years
(dollars in thousands)
Water and Wastewater Refunding Revenue Bond,Series 2009
Less: Net
Fiscal Gross Operating Impact Available Debt Service
Year Revenues(') Expenses(2) Fees Revenue Principal Interest Total Coverage
2010 $ 7,085,984 $ 4,863,198 $ 226,897 $ 2,449,683 $ - $ 95,296 $ 95,296 25.71
2011 7,474,168 4,372,447 70,550 3,172,271 505,000 261,545 766,545 4.14
2012 7,634,056 4,849,002 42,979 2,828,033 570,000 243,378 813,378 3.48
2013 8,238,099 5,140,343 61,907 3,159,663 585,000 223,635 808,635 3.91
Water and Wastewater System Refunding Revenue Bond,Series 2012
Available Net
Fiscal Revenue& Debt Service
Year Impact Fees Principal Interest Total Coverage
2012 $ 2,014,655 $ - $ - $ - 0.00
2013 2,351,028 569,000 154,891 723,891 0.31
Note: Detail regarding the City's outstanding debt can be found in the notes to the financial statements.
(1) According to the Resolution,Gross Revenues should exclude interest earnings on the
Renewal and Replacement Fund and Construction Fund.
(2) Total direct operating expenses excludes depreciation,amortization and overhead
charges.
Required coverage of 1.05 refers to the Series 2009 Bonds.
97
CITY OF EDGEWATER, FLORIDA
Demographic and Economic Statistics
Last Ten Fiscal Years
Total Per Capita County
Calendar Personal Personal Median Unemployment School
Year Population(1) Income(1) Income(1) Age(1) Rate(2) Enrollment(3)(4)
2004 20,637 $ 538,997,166 $ 26,118 43.6 5.0% 2,179
2005 21,156 575,675,916 27,211 43.7 3.4% 2,191
2006 21,572 611,501,484 28,347 43.8 3.1% 2,203
2007 21,558 535,586,952 24,844 45.4 3.4% 2,166
2008 21,997 561,319,446 25,518 46.0 7.2% 2,180
2009 21,394 536,989,400 25,100 46.3 11.8% 2,188
2010 21,017 549,153,193 26,129 46.1 12.6% 2,144
2011 20,885 432,528,350 20,710 46.4 10.3% 1,900
2012 20,775 423,020,550 20,362 47.5 8.8% 1,895
2013 20,737 443,418,346 21,765 47.9 6.8% 1,933
Sources:
(1)Volusia County Demographic Statistics:2004-2012; University of Florida BEBR:2013
(2)Florida Agency for Workforce Innovation:2004-2010; U.S. Bureau of Labor Statistics 2011 -2013
(3)Recived data from schools directly:2004-2011; Obtained data from Volusia County School District:2012-2013
(4)Includes Discovery Academy(elementary), Indian River Elementary,and Edgewater Elementary
98
CITY OF EDGEWATER, FLORIDA
Principal Employers
Current Year and Ten Years Ago
2013 2004
Percentage Percentage
Number of of Total County Number of of Total County
Employer (1)(2) Employees Employment Employees Employment
City of Edgewater 194 0.08% - -
Publix Supermarkets 137 0.06% - -
Everglade Boats 159 0.07% - -
Brunswick Commercial&Government Products 105 0.04% - -
Winn Dixie Supermarkets 95 0.04% - -
Edgewater Power Boats 92 0.04% - -
Edgewater Elementary 85 0.04% - -
Indian River Elementary 81 0.03% - -
Edgewater Family YMCA of S.E.Volusia 77 0.03% - -
Dustin's Bar-B-Q 30 0.01% - -
Total 1,055 0.44% - -
Total County Employment(3) 235,231 -
Sources:
(1)Information provided by each company
(2)Information not available for 2004
(3)Labor Market Statistics,Florida Research and Economic Database
99
CITY OF EDGEWATER, FLORIDA
Full-Time Equivalent City Government Employees by Function/Program
Last Ten Fiscal Years
Fiscal Year
Function/program 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004
General Government:
Mayor and Commission 5.0 5.0 5.0 5.0 5.0 5.0 5.0 5.0 5.0 5.0
City Manager 2.0 2.0 2.0 2.0 2.0 1.0 2.0 3.0 3.0 3.0
City Clerk 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0
Finance 9.5 9.5 6.5 6.5 7.0 8.0 9.0 10.0 10.0 7.0
IT/MIS 2.0 2.0 2.0 2.0 2.0 2.0 0.0 0.0 0.0 0.0
Human Resources 2.0 2.0 2.0 2.0 2.0 2.0 2.0 3.0 2.0 2.0
Community Development
Planning and Zoning 2.0 2.0 3.0 3.0 3.0 3.0 4.0 3.0 3.0 3.0
Building 3.5 3.5 3.5 3.5 3.5 4.0 4.0 6.0 5.0 4.0
Public Safety:
Police Department 35.0 33.5 33.0 34.0 33.5 36.0 33.0 40.0 37.0 38.0
Fire Department 29.5 29.0 30.0 30.0 31.0 32.0 35.0 38.0 28.0 23.0 �..
Animal Control/Shelter 2.0 2.0 5.0 4.0 4.0 5.0 2.0 3.0 2.0 2.0
Code Enforcement 2.0 2.0 1.0 3.0 3.0 3.0 2.0 3.0 4.0 3.0
Water Resources
Water Utility 11.0 9.0 10.0 10.0 10.0 10.0 9.0 10.0 10.0 10.0
Wastewater Utility 15.0 14.0 15.0 15.0 15.0 15.0 16.0 11.0 11.0 11.0
Field Operations 11.0 10.0 9.0 10.0 10.0 9.0 10.0 5.0 13.0 13.0
Stormwater 9.5 9.0 8.0 7.0 6.0 8.0 9.0 10.0 5.0 5.0
Refuse 26.0 24.0 23.0 23.0 23.0 24.0 27.0 28.0 22.0 22.0
Parks and Recreation 15.0 15.0 15.0 16.0 16.0 16.0 12.0 20.0 14.0 15.0
Fleet 3.0 3.0 3.0 2.0 2.0 3.0 0.0 0.0 0.0 0.0
Public Works 9.0 7.0 7.0 7.0 8.0 0.0 0.0 0.0 7.0 5.0
Totals: 196.0 185.5 185.0 187.0 188.0 188.0 183.0 200.0 183.0 173.0
100
CITY OF EDGEWATER,FLORIDA
Operating Indicators by Function/Program
Last Ten Fiscal Years
Fiscal Year
Function/program 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004
General Government
Employment Applications Received 541 543 401 339 625 763 392 275 298 334
Personnel Actions Processed 138 136 81 90 94 116 89 157 152 156
Accidents&Injuries Reviewed 60 52 29 40 51 45 30 18 20 26
Business Tax Receipts Issued 1,269 1,544 982 1,401 1,707 1,699 1,722 1,720 1,681 1,650
Checks Issued 2,414 1,727 1,727 983 2,947 3,253 3,682 4,883 4,243 *
Purchase Orders Issued 757 734 408 449 766 1,000 1,124 1,962 1,975 729
Public Safety
Police Department
Accidents 239 246 328 259 250 257 281 254 341 323
Traffic citations issued 3,188 5,245 5,958 4,780 5,514 3,419 6,528 6,000 6,319 6,764
Evidence Processed 1,803 1,800 2,130 2,027 1,582 1,703 2,197 2,203 2,153 2,191
Physical arrests 1,128 1,393 1,327 1,227 1,649 1,378 1,287 1,141 1,113 945
Calls for service 34,395 29,752 34,228 31,168 31,394 33,379 41,909 33,115 32,706 36,321
Fire Department
Emergency responses 2,738 2,679 2,825 2,873 2,841 2,991 3,035 3,069 2,922 2,701
Average response time-minutes 4.19 4.18 4.25 4.56 4.41 4.50 4.50 4.40 4.10 4.70
Public Education Programs 64 63 62 60 70 41 56 19 10 12
Fire inspections 1,015 1,002 920 810 807 860 867 171 168 180
Burn Permits Issued - - - 1 - 5 - 4 8 8
Public Works
Miles of street paved - - - - - - - 1 - 7
Miles of street Resurfaced 1 2 - - 4 - - 3 7 7
Sidewalks-new construction-miles 1 1 - - - - - 14 - -
Leisure Services
Ball games&field rentals 1,226 1,598 1,726 1,887 1,974 1,958 1,935 2,003 *
Events/Programs 17 19 14 19 21 23 26 11 * *
Water Resources
Water main breaks 84 80 88 88 63 76 81 60 64 72
Average daily consumption-mgd 1.900 1.929 1.931 1.931 1.941 1.944 1.989 1.850 1.770 1.710
Number of water customers 10,603 10,580 10,542 10,542 10,504 10,487 10,467 10,387 10,164 10,191
New Connections 23 18 38 38 16 35 54 175 278 265
Sewer Resources
New Connections 19 11 26 26 8 30 42 162 261 214
Average daily consumption-mgd 1,264 1 1 1.179 1.324 1.523 1.225 1.070 1.180 1.090
Number of customers 9,869 9,850 9,823 9,823 9,797 9,784 9,761 9,626 9,394 9,214
Refuse Collection
Number of Customers 9,451 9,403 9,378 9,378 9,356 9,326 9,272 9,205 8,977 8,809
Sources:Provided by the respective departments of the City of Edgewater
*Infornation not available.
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CITY OF EDGEWATER,FLORIDA
Capital Asset Statistics by Function/Program
Last Ten Fiscal Years
Fiscal Year
Function/program 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004
Police
Police Stations 1 1 1 1 1 1 1 1 1 1
Police Vehicles 27 28 30 30 30 24 26 30 24 24
Patrol Zones 2 2 2 2 2 2 2 2 2 2
Fire
Fire Stations 2 2 2 2 2 2 2 2 2 2
Fire Vehicles 17 17 18 15 15 13 13 15 11 11
Public Works
Streets(miles) 124 124 124 124 124 124 124 124 123 123
Number of street lights 1,068 1,068 1,068 1,068 1,068 1,068 1,068 1,068 1,068 1,068 ..-
Number of traffic signals 3 3 3 3 3 3 3 3 3 3
Vehicles 9 8 5 5 5 5 5 5 4 4
Leisure Services
Vehicles 12 12 12 12 12 9 9 10 10 9 w
Parks Acreage 151 151 151 151 151 151 151 143 150 151
Parks 28 28 28 28 28 28 28 28 28 28
Baseball Fields 7 7 7 7 7 7 7 7 7 7
Tennis Courts 4 4 4 4 4 4 4 4 4 5 ..
Basketball Courts 2 2 2 2 2 2 2 2 2 2
Racquetball Courts 4 4 4 4 4 4 4 4 4 6
Community Center 0 0 1 1 1 1 1 1 1 1
Gymnasiums 1 1 1 1 1 1 1 1 1 1 ,„,
Water Resources
Water mains(miles) 275 275 274 274 274 274 274 194 186 186
Fire hydrants 701 700 700 700 695 694 694 691 686 670
Vehicles 24 24 23 23 23 23 23 14 13 13
Sewer mains(miles) 189 189 189 189 189 189 189 189 180 180
Reclaim Water(miles) 72 71 71 71 71 71 71 71 71 69
Stormwater Utility
Storm Sewers(miles) 36 36 35 35 35 35 35 35 35 35
Vehicles 16 15 7 7 10 10 10 10 7 7
Solid Waste
Garbage Trucks 10 9 7 7 8 7 10 10 7 5
Other Vehicles 13 13 12 12 14 14 15 15 12 10
Sources:Provided by the respective departments of the City of Edgewater
102
CITY OF EDGEWATER, FLORIDA
Schedule of State Financial Assistance
For the Fiscal Year Ended September 30,2013
CSFA
State Agency/Pass-Through Entity/State Project Number Contract/Grant Number Expenditures
State Agency
Department of Environmental Protection
Direct
Wastewater Treatment Facility Construction 37.077 WW64052 $ 4,403,042
Total Department of Environmental Protection 4,403,042
Total State Financial Assistance $ 4,403,042
Notes:
1) The accompanying Schedule of State Financial Assistance includes state financial assistance activity of the City of Edgewater, Florida and
is presented on the accrual basis of accounting. The information in this schedule is presented in accordance with the requirements of
Chapter 10.550, Rules of the Florida Auditor General.
103
CITY OF EDGEWATER,FLORIDA
SCHEDULE OF FINDINGS AND QUESTIONED COSTS—STATE PROJECTS
FOR THE YEAR ENDED SEPTEMBER 30,2013
A. Summary of Auditors' Results:
Financial Statements:
• Type of audit report issued on the basic financial statements: Unmodified. rrr
Internal control over financial reporting:
• There were no significant deficiencies or material weaknesses related to internal control
over financial reporting disclosed by the audit.
• The audit did not disclose any noncompliance, which was material to the basic financial
statements.
State Financial Assistance:
✓
Internal control over major State projects:
• There were no significant deficiencies or material weaknesses related to internal control
over major State projects disclosed by the audit.
• Type of report issued on compliance for each major program: Unmodified.
• The audit disclosed one audit finding, which is required to be reported under Chapter
10.550,Rules of the Auditor General and is included in this schedule.
• Major project identification: ""
CFDA No. 37.077—Wastewater Treatment Facility Construction
• Dollar threshold used to distinguish between Type A and Type B programs was$300,000.
B. Financial Statement Findings
None.
C. State Financial Assistance Findings and Questioned Costs:
1rr
2013-001—CSFA 37.077—Wastewater Treatment Facility Construction: Retainage Withheld
Condition: On one owner direct vendor they provider two style of invoices. One style withheld
retainage, while the other style did not. This resulted in excess of ten percent of retainage being
withheld on several invoices received.
Criteria: Florida Statute, 218.735, indicates the maximum allowable retainage is ten percent of the
invoiced amount related to construction by a local municipality.
Cause: The City withheld retainage on the invoiced amount and did not notice the vendor had s`
already reduced the invoice amount due for retainage.
Effect: The grantor agency could withhold funding or require reimbursement from the grantee.
Context: This incident was isolated to one vendor due to an oversight related specifically to the
vendor invoice and was not found to be the case on any other vendors selected for testing.
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Recommendation: Review invoices more carefully to ensure retainage is not already subtracted from
the amount due by the vendor.
D. Prior Audit Findings:
2011-002 Information Technology: Corrective action taken.
2012-001 Accounts and Retainage Payable: Corrective action taken.
E. Corrective Action Plan:
See attached response to findings as listed in the table of contents.
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Ai dames Moore
Certified Public Accountants and Consultants NB
INDEPENDENT AUDITORS' REPORT ON COMPLIANCE FOR EACH MAJOR STATE 1116
PROJECT AND REPORT ON INTERNAL CONTROL OVER COMPLIANCE
IN ACCORDANCE WITH CHAPTER 10.550,RULES OF THE AUDITOR GENERAL
To the Honorable Mayor,City Council,and City Manager,
City of Edgewater, Florida: `g
Report on Compliance for Each Major State Project
We have audited the City of Edgewater, Florida's (the City) compliance with the types of compliance
requirements described in the Department of Financial Services' State Projects Compliance Supplement
that could have a direct and material effect on each of the City's major State projects for the year ended
September 30, 2013. The City's major State projects are identified in the summary of auditors' results
section of the accompanying schedule of findings and questioned costs.
Management's Responsibility i»
Management is responsible for compliance with the requirements of laws, regulations, contracts, and
grants applicable to its State projects.
rr
Auditors'Responsibility
Our responsibility is to express an opinion on compliance for each of the City's major State projects
based on our audit of the types of compliance requirements referred to above. We conducted our audit of ""
compliance in accordance with auditing standards generally accepted in the United States of America;the
standards applicable to financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States; and Chapter 10.550, Rules of the Auditor General. Those
so
standards and Chapter 10.550,Rules of the Auditor General, require that we plan and perform the audit to
obtain reasonable assurance about whether noncompliance with the types of compliance requirements
referred to above that could have a direct and material effect on a major State project occurred. An audit
includes examining, on a test basis, evidence about the City's compliance with those requirements and ow
performing such other procedures as we considered necessary in the circumstances.
We believe that our audit provides a reasonable basis for our opinion on compliance for each major state
project.However,our audit does not provide a legal determination of the City's compliance. r+•
Opinion on Each Major State Project
In our opinion, the City complied, in all material respects, with the types of compliance requirements
referred to above that could have a direct and material effect on each of its major State projects for the
year ended September 30,2013.
■r
121 Executive Circle 5931 NW 1st Place 2477 Tim Gamble Place,Suite 200
Daytona Beach,FL 32114-1180 Gainesville,FL 32607-2063 Tallahassee,FL 32308-4386
Telephone:386/257-4100 Telephone:352/378.1331 Telephone:850/386-6184
Fax:386/255-3261 Fax:352/372-3741 Fax:8501422-2074
dab @jmco.com gnv @jmco.com tlh @jmco.com
Ale,nber of International with offices in principal cities worldwide
106
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Other Matters
The results of our auditing procedures disclosed instances of noncompliance which are required to be
reported in accordance with Chapter 10.550,Rules of the Auditor General, and which are described in the
accompanying schedule of findings and questioned costs as item 2013-001. Our opinion on each major
State project is not modified with respect to these matters.
The City's response to the noncompliance finding identified in our audit is described in the accompanying
Reply to the Independent Auditors' Reports. The City's response was not subjected to the auditing
procedures applied in the audit of compliance and, accordingly,we express no opinion on the response.
IiIi Report on Internal Control over Compliance
Management of the City is responsible for establishing and maintaining effective internal control over
compliance with the types of compliance requirements referred to above. In planning and performing our
audit,we considered the City's internal control over compliance with the types of requirements that could
have a direct and material effect on each major State Project a basis for designing auditing procedures that
are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each
major State Project and to test and report on internal control over compliance in accordance with Chapter
10.550, Rules of the Auditor General, but not for the purpose of expressing an opinion on the
effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the
effectiveness of the City's internal control over compliance.
A deficiency in internal control over compliance exists when the design or operation of a control over
compliance does not allow management or employees, in the normal course of performing their assigned
functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a
federal program on a timely basis. A material weakness in internal control over compliance is a
deficiency, or combination of deficiencies, in internal control over compliance, such that there is a
reasonable possibility that material noncompliance with a type of compliance requirement of a State
Project will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in
internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over
compliance with a type of compliance requirement of a State project that is less severe than a material
weakness in internal control over compliance, yet important enough to merit attention by those charged
ii with governance.
Our consideration of internal control over compliance was for the limited purpose described in the first
iiii
paragraph of this section and was not designed to identify all deficiencies in internal control over
compliance that might be material weaknesses or significant deficiencies. We did not identify any
deficiencies in internal control over compliance that we consider to be material weaknesses. However,
material weaknesses may exist that have not been identified.
1;i The purpose of this report on internal control over compliance is solely to describe the scope of our
testing of internal control over compliance and the results of that testing based on the requirements of
Chapter 10.550, Rules of the Auditor General. Accordingly, this report is not suitable for any other
iiiii purpose.
avAl.# Atilt 41 (e . / ?.L. .
Daytona Beach,Florida
March 13,2014
ii
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AA James Moore
Certified Public Accountants and Consultants
INDEPENDENT AUDITORS' REPORT ON INTERNAL CONTROL OVER FINANCIAL
REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT
OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH
GOVERNMENT AUDITING STANDARDS rrr
am
To the Honorable Mayor,City Council,and City Manager
City of Edgewater,Florida:
We have audited, in accordance with auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing Standards,
issued by the Comptroller General of the United States, the financial statements of the governmental
activities, the business-type activities, each major fund, and the aggregate remaining fund information of el.
the City of Edgewater,Florida(the City)as of and for the year ended September 30, 2013, and the related
notes to the financial statements, which collectively comprise the City's basic financial statements, and
have issued our report thereon dated March 13,2014. no
Internal Control over Financial Reporting
■
In planning and performing our audit of the financial statements,we considered the City's internal control
over financial reporting to determine the audit procedures that are appropriate in the circumstances for the
purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an
opinion on the effectiveness of the City's internal control. Accordingly, we do not express an opinion on sr
the effectiveness of the City's internal control.
A deficiency in internal control exists when the design or operation of a control does not allow ,1,,,
management or employees, in the normal course of performing their assigned functions, to prevent, or
detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination
of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement
of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A
significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less
severe than a material weakness, yet important enough to merit attention by those charged with
governance. no
Our consideration of internal control over financial reporting was for the limited purpose described in the
first paragraph of this section and was not designed to identify all deficiencies in internal control over
financial reporting that might be material weaknesses or significant deficiencies, and therefore, material
weaknesses or significant deficiencies may exist that were not identified. Given these limitations, during
our audit,we did not identify any deficiencies in internal control over financial reporting that we consider
to be material weaknesses. However,material weaknesses may exist that have not been identified. ..
121 Executive Circle 5931 NW 1st Place 2477 Tim Gamble Place,Suite 200
Daytona Beach,FL 32114-1180 Gainesville,FL 32607-2063 Tallahassee,FL 32308-4386
Telephone:386/257-4100 Telephone:352/378-1331 Telephone:850/386-6184
Fax:386/255-3261 Fax:352/372-3741 Fax:850/422-2074
dab@jmco.com gnv @jmco.com tlh @jmco.com
Member ofAGN International with offices in principal cities worldwide
108
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Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City's financial statements are free of
material misstatement, we performed tests of its compliance with certain provisions of laws, regulations,
contracts, and grant agreements,noncompliance with which could have a direct and material effect on the
determination of financial statement amounts. However, providing an opinion on compliance with those
provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The
results of our tests disclosed no instances of noncompliance or other matters that are required to be
reported under Government Auditing Standards.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance
and the results of that testing, and not to provide an opinion on the effectiveness of the entity's internal
control or on compliance. This report is an integral part of an audit performed in accordance with
Government Auditing Standards in considering the entity's internal control and compliance. Accordingly,
this communication is not suitable for any other purpose.
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Daytona Beach,Florida
March 13,2014
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..)U Jaes Moore
Certified Pubic Accountants and Consultants
INDEPENDENT AUDITORS' MANAGEMENT LETTER REQUIRED BY CHAPTER 10.550, irr
RULES OF THE STATE OF FLORIDA OFFICE OF THE AUDITOR GENERAL
or
To the Honorable Mayor,City Council,and City Manager,
City of Edgewater, Florida:
■.t
We have audited the financial statements of City of Edgewater, Florida,as of and for the fiscal year ended
September 30, 2013,and have issued our report thereon dated March 13,2014.
We conducted our audit in accordance with auditing standards generally accepted in the United States of tar
America, and the standards applicable to financial audits contained in Government Auditing Standards,
issued by the Comptroller General of the United States; and Chapter 10.550, Rules of the Auditor
General. We have issued our Independent Auditors' Report on Internal Control over Financial Reporting
and Compliance and Other Matters, Independent Auditors' Report on Compliance for Each Major State �•
Project and Report on Internal Control Over Compliance Required by Chapter 10.550, Rules of the
Auditor General, and Schedule of Findings and Questioned Costs. Disclosures in those reports and
schedule, which are dated March 13, 2014, should be considered in conjunction with this management
letter.
Additionally, our audit was conducted in accordance with the provisions of Chapter 10.550, Rules of the
Auditor General, which govern the conduct of local government entity audits performed in the State of
Florida. This letter includes the following information, which is not included in the aforementioned W"
auditor's reports or schedule:
Section 10.554(1)(i)1.,Rules of the Auditor General,requires that we determine whether or not corrective sr
actions have been taken to address findings and recommendations made in the preceding annual financial
audit report. Findings and recommendations made in the preceding annual financial audit and their status
is summarized in the schedule of findings and questioned costs and below:
2011-008 Deficit Fund Equity—Corrective action taken.
2012-002 Signatures on Checks over$50,000—Corrective action taken.
2013-003 Accounts Receivable—Corrective action taken.
All findings included in the second preceding fiscal year financial audit report under the same paragraph
headings were corrected.
Section 10.554(1)(i)2., Rules of the Auditor General, requires our audit to include a review of the
provisions of Section 218.415, Florida Statutes, regarding the investment of public funds. In connection
with our audit, we determined that the City of Edgewater, Florida complied with Section 218.415, Florida
Statutes.
Section 10.554(1)(i)3., Rules of the Auditor General, requires that we address in the management letter
any recommendations to improve financial management. In connection with our audit, we have the ..r
following recommendations:
.r
a.
121 Executive Circle 5931 NW 1st Place 2477 Tim Gamble Place,Suite 200
Daytona Beach,FL 32114 1 180 Gainesville,FL 32607-2063 Tallahassee,FL 32308-4386
Telephone:386/257-4100 Telephone:352/378.1331 Telephone:850/386-6184
Fax:386/255-3261 Fax:352/372-3741 Fax:850/422-2074
dabQjmco.com gnv @jmco.com tlh@jmco.com
Member ofAGN International with offices in principal cities worldwide
110
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law
2013-002 Fully Insured and Workers Comp Deficit Net Position —At September 30, 2013, the
Fully Insured and Workers Comp internal service funds have a deficit net position of$84,492 and
ti,L $1,471, respectively. We recommend the City develop a plan to eliminate these deficits in net
II position.
2013-003 City's Police Pension Contribution — Our initial testing of the City's Police Pension
contribution indicated the City did not contribute the annual required contribution. We discussed
with the City and the City's actuary and it was determined an error had occurred in the information
and instructions provided to the actuary, and therefore, the required city contribution was not
calculated corrected.The actuary upon receipt of the revised information and instructions provided a
corrected actuarial valuation. We recommend the City in conjunction with the Police Pension board
iiii and other pension boards more closely monitor the information provided to the actuaries is carefully
analyzed to be complete and accurate per Board actions an intent.
1 Section 10.554(1)(i)4., Rules of the Auditor General, requires that we address violations of provisions of
contracts or grant agreements, or abuse, that have occurred, or are likely to have occurred, that have an
effect on the financial statements that is less than material but more than inconsequential. In connection
with our audit,we did not have any such findings.
Section 10.554(1)(i)5., Rules of the Auditor General, requires that the name or official title and legal
authority for the primary government and each component unit of the reporting entity be disclosed in this
management letter, unless disclosed in the notes to the financial statements. The official title and legal
authority for the primary government are discussed in note 1 to the financial statements. The City does
not report any component units.
Section 10.554(1)(i)6.a., Rules of the Auditor General, requires a statement be included as to whether or
not the local governmental entity has met one or more of the conditions described in Section 218.503(1),
Florida Statutes, and identification of the specific condition(s) met. In connection with our audit, we
determined that the City of Edgewater, Florida did not meet any of the conditions described in Section
218.503(1),Florida Statutes.
Section 10.554(1)(i).6.b., Rules of the Auditor General, requires that we determine whether the annual
financial report for the City of Edgewater,Florida for the fiscal year ended September 30,2013, filed with
the Florida Department of Financial Services pursuant to Section 218.32(1)(a), Florida Statutes, is in
agreement with the annual financial audit report for the fiscal year ended September 30, 2013. In
connection with our audit,we determined that these two reports were in agreement.
Pursuant to Sections 10.554(1)(i)7.c. and 10.556(7), Rules of the Auditor General, we applied financial
condition assessment procedures. It is management's responsibility to monitor the City of Edgewater,
Florida financial condition, and our financial condition assessment was based in part on representations
made by management and the review of financial information provided by same.
The City's response to the findings identified in our audit is described in the accompanying response to
management comments. The City's response was not subjected to the auditing procedures applied in the
iiiaudit of the financial statements and,accordingly,we express no opinion on it.
Our management letter is intended solely for the information and use of the Legislative Auditing
Committee, members of the Florida Senate and the Florida House of Representatives,the Florida Auditor
General, Federal and other granting agencies, and applicable management, and is not intended to be and
should not be used by anyone other than these specified parties.
aws, Wtt9+C i i
Daytona Beach,Florida
N March 13,2014
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MEMO TO: The Honorable Mayor and City Council
The State Auditor General
THRU: Tracey T. Barlow, City Manager
FROM: Jonathan C. McKinney, Finance Director
DATE: March 26, 2013
SUBJECT: Reply to the Independent Auditor's Report on Internal Control and Management
Letter Comments for Fiscal Year Ended September 30, 2013
FINANCIAL STATEMENT FINDINGS
Retainaqe Withheld
Management concurs with this comment and recommendation to review more carefully invoices
withholding retainage
CURRENT YEAR FINDINGS AND RECOMMENDATIONS
Deficit Net Position
Management concurs with this comment and implemented the necessary changes in the FY 2013—2014
budgets.
Pension Contributions
Management concurs with this comment and recommendation to monitor the information provided to the
actuaries and Boards per actions taken.
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EDGE,�WATER
AFFIDAVIT OF IMPACT FEE COMPLIANCE
The City of Edgewater, Florida has complied with Section 163.31801 of Florida
Statues regarding accounting and reporting of impact fee collections and
expenditures. a
,
Tracey T. Barlow Jonathan C. McKinney
City Manager Finance Director
STATE OF FLORIDA
COUNTY OF VOLUSIA
I HEREBY CERTIFY that on this day, before me, an officer duly authorized in the
State and County aforesaid to take acknowledgments, personally appeared Tracey
T. Barlow and Jonathan C. McKinney, whom I know personally and whom executed
the foregoing instrument and acknowledged before me that he executed the same.
WITNESS my hand and official seal in the County and State last aforesaid this 26th
day of March 2013.
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(Seal/Stamp) Notary Public
(Commission Expiration Date) State of Florida at Large
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