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Cl*ty of Poway
Poway, California
Comprehensive Annual Financial Report
For the year ended June 30, 2011
PREPARED BY THE CITY OF POWAY, CALIFORNIA
FINANCE DIVISION
City of Poway
Basic Financial Statements
For the year ended June 30, 2011
Table of Contents
Page
INTRODUCTORY SECTION
Tableof Contents ........................................................................................................................ ............................... i
Letterof Transmittal ................................................................................................................. ............................... v
PrincipalOfficials ................................................................................................................... ............................... xvi
OrganizationalChart ............................................................................................................ ............................... xvii
GFOA Certificate of Achievement for Excellence in Financial Reporting ........................ ..........................xviii
FINANCIAL SECTION
IndependentAuditors' Report ............................................................................................... ............................... l
Management's Discussion and Analysis (Unaudited) ...................................................... ............................... 3
Basic Financial Statements:
Government - Wide Financial Statements:
Statementof Net Assets ............................................................................................. ............................... 18
Statement of Activities and Changes in Net Assets ............................................... ............................... 20
Fund Financial Statements:
Governmental Fund Financial Statements:
BalanceSheet ........................................................................................................ ............................... 26
Reconciliation of Governmental Funds Balances Sheet to the
Government -Wide Statement of Net Assets .............................................. ............................... 28
Statement of Revenues, Expenditures
and Changes in Fund Balances .................................................................... ............................... 30
Reconciliation of Governmental Statement of Revenues, Expenditures,
and Changes in Fund Balances to the Government -Wide Statement
of Activities and Changes in Net Assets .................................................... ............................... 32
Proprietary Fund Financial Statements:
Statementof Net Assets ...................................................................................... ............................... 34
Statement of Revenues, Expenses and Changes in Fund Net Assets ........... ............................... 35
Statementof Cash Flows ..................................................................................... ............................... 36
Fiduciary Fund Financial Statements:
Statement of Fiduciary Net Assets .................................................................... ............................... 38
Notes to Basic Financial Statements ............................................................................. ............................... 39
0
City of Poway
Basic Financial Statements
For the year ended June 30, 2011
Table of Contents, Continued
Page
FINANCIAL SECTION, Continued
Required Supplementary Information (Unaudited):
BudgetaryInformation .............................................................................................. ............................... 84
Budgetary Comparison Schedule - General Fund ................................................ ............................... 85
Budgetary Comparison Schedule - Low/ Moderate Income Housing Special Revenue Fund...... 86
Budgetary Comparison Schedule - Housing Fund ............................................... ............................... 87
Budgetary Comparison Schedule - Royal MobileHome Park Fund .................. ............................... 88
Defined Benefit Pension Plans .................................................................................. ............................... 89
Supplementary Information:
Non -Major Governmental Funds:
CombiningBalance Sheet .......................................................................................... ............................... 95
Combining Statement of Revenues, Expenditures and Changes in Fund Balances ......................
100
Non -Major Special Revenue Funds:
City of Poway RDA Debt Service Fund ....................... ............................... ............................105
FireProtection .............................................................................................. ...............................
106
800 MHz Communication System ................................ ............................... ............................107
GasTax .............................................................................. ............................... ............................108
StreetImprovement .................................................................................... ...............................
109
DrainageSpecial .............................................................. ............................... ............................110
MaintenanceDistricts ................................................................................ ...............................
111
MiscellaneousGrants ...................................................... ............................... ............................112
Community Development Block Grant ....................... ............................... ............................113
Transportation Development Act ............................................................. ...............................
114
PropositionA Special ................................................................................. ...............................
115
TrafficCongestion AB 2928 ............................................ ............................... ............................116
Storm Water Management Special Revenue Fund ................................. ...............................
117
Regional Arterial Traffic Mitigation Special Revenue Fund .................... ............................118
Fire Protection Impact Fees ........................................................................ ...............................
119
BEGINProgram ........................................................................................... ...............................
120
MaryPatricia Ross ....................................................................................... ...............................
121
CityDebt Service Fund ................................................... ............................... ............................122
Park Improvement Capital Project Fund ................................................. ...............................
123
Municipal Improvement Capital Project Fund ........... ............................... ............................124
CIPFund ....................................................................................................... ...............................
125
ii
City of Poway
Basic Financial Statements
For the year ended June 30, 2011
Table of Contents, Continued
Page
FINANCIAL SECTION, Continued
Internal Service Funds:
Combining Statement of Net Assets .......................................... ............................... ............................128
Combining Statement of Revenues, Expenses and Changes in Net Assets ........ ............................129
Combining Statement of Cash Flows ........................................ ............................... ............................130
Agency Funds:
Combining Statement of Fiduciary Net Assets ........................ ............................... ............................132
Combining Statement of Changes in Assets and Liabilities ... ............................... ............................133
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 .... ............................... 135
iii
STATISTICAL SECTION (Unaudited)
'
'
Net Assets by Component - Current and Prior Four Years ................ ............................... ............................139
Changes in Net Assets for Governmental Activities - Current and Prior Four Years ... ............................140
Changes in Net Assets for Business -Type Activities - Current and Prior Four Years ... ............................141
Changes in Net Assets for Primary Government - Current and Prior Four Years ......... ............................141
Fund Balances, Governmental Funds - Last Ten Fiscal Years ............ ............................... ............................142
'
Changes in Fund Balances, Governmental Funds - Last Ten Fiscal Years ...................... ............................144
Assessed Value of Taxable Property General Property Tax - Last Ten Fiscal Years ...... ............................146
Direct and Overlapping Property Tax Rates General Property Tax - Last Ten Fiscal Years ....................148
'
Principal Secured Property Tax Payers General Property Tax
- Current Year and Nine Years Ago ................................................. ............................... ............................149
'
Assessed Value of Taxable Property Redevelopment Tax Increment
Property Tax - Last Ten Fiscal Years ............................................... ............................... ............................150
Redevelopment Property Tax Levies and Collections - Last Ten Fiscal Years ............... ............................152
General Property Tax Levies and Collections - Last Ten Fiscal Years ............................. ............................153
Ratios of Outstanding Debt by Type - Last Ten Fiscal Years .............. ............................... ............................154
'
Ratios of General Bonded Debt Outstanding - Last Ten Fiscal Years ........................... ...............................
156
'
Direct and Overlapping Debt as of June 30, 2009 ................................. ............................... ............................157
Legal Debt Margin Information - Last Ten Fiscal Years ...................... ............................... ............................158
iii
City of Poway
Basic Financial Statements
For the year ended June 30, 2011
Table of Contents, Continued
Page
STATISTICAL SECTION, Continued
Pledged Revenue Coverage - Last Ten Fiscal Years ............................ ............................... ............................160
Demographic and Economic Statistics - Last Ten Calendar Years ................................ ............................... 161
Principal Employers - Current and Prior Three Years .................................................... ............................... 162
Full- Time - Equivalent City Employees by Function - Last Six Fiscal Years .................. ............................... 163
Operating Indicators - Current and Prior Three Years ........................ ............................... ............................164
Capital Assets Statistics - Current and Prior Three Years ............................................... ............................... 165
iv
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DON HIGGINSON, Mayor
JIM CUNNINGI IMAM, Deputy Mayor
MERRILEIF, BOYACK, Councilmember
DAVI? GROSCH, Counciltnember
JOHN M JUAN, Councilmember
January 13, 2012
CITY OF POWAY
Honorable Mayor and Members of the City Council
Poway, California
This Comprehensive Annual Financial Report (CAFR) is prepared in order to provide you and the
community with a report of the financial transactions of the City of Poway, for the year ended June
30, 2011. Responsibility for the accuracy, completeness, and fairness of the report rests with the
City.
We believe that the data, as presented, is accurate in all material aspects; that it is presented in a
manner designed to fairly set forth the financial position and results of operations of the City, as
measured by the financial activity of its various fund types; and that all disclosures necessary to
enable the reader to gain the maximum understanding of the City's financial affairs have been
included.
The significant accounting policies of the City are described in the Notes to Financial Statements.
These accounting policies have been approved by the City's independent certified public
accountants, and are in conformance with the recommendations of the American Institute of
Certified Public Accountants and the Governmental Accounting Standards Board (GASB).
This report is prepared following the guidelines set forth by the Government Finance Officers
Association of the United States and Canada and the California Society of Municipal Finance
Officers.
In accordance with the above - mentioned guidelines, the report is divided into three sections:
Introductory Section - including this letter of transmittal, the City's organizational
chart, and the list of principal officers.
2. Financial Section - including the independent report from the City's certified public
accountants, management's discussion and analysis, basic financial statements,
notes to financial statements, and required supplementary information.
3. Statistical Section - including other pertinent unaudited financial tables and
information that presents historical trends, demographics, and miscellaneous data
about the City.
Management's Discussion and Analysis (MD&A) immediately follows the independent auditor's
report and provides a narrative introduction, overview, and analysis of the basic financial
statements. MD&A complements this letter of transmittal and should be read in conjunction with it.
City Hall Located at 13325 Civic Center Drive
Mailing Address: P.O. Box 789, Poway, California 92074 -0789
www.poway.org
Annual Financial Report
January 13, 2012
Page vi '
The Reporting Entity and Its Services
Included within the City's financial statements is the financial information of the Poway Redevelopment '
Agency, the Poway Housing Authority, and the Poway Public Financing Authority. Although the entities
are legally separate from the City, their financial operations are closely related. Their activities are
included with the activities of the City, because the City Council serves as the Board of Directors and is '
able to impose its will on both entities. There is, therefore, a financial benefit/burden relationship. This
financial presentation is in accordance with GASB Codification, Section 2100.
The City of Poway was incorporated December 1, 1980, under the general laws of the State of 1
California. The City operates under a Council- Manager form of government and provides the following
services: public safety (law enforcement, fire suppression /paramedics), community services, '
development services, public works, general administrative services, and capital improvements.
The Poway Redevelopment Agency was established April 26, 1983, pursuant to the State of California
Health and Safety Codes, Section 33000, entitled "Community Redevelopment Law." Its purpose is to '
eliminate blighted areas by encouraging the development of residential, commercial, industrial,
recreational, and public facilities.
The Poway Housing Authority was established by Resolution of the Poway City Council at a special '
meeting on March 11, 2011 in accordance with the State of California Health and Safety Codes,
Section 34200, entitled "Housing Authorities Law ". Its purpose is to monitor rent and income '
compliance at affordable housing developments and partner with developers to construct and operate
affordable housing in Poway.
The Poway Public Financing Authority is a joint powers authority organized pursuant to the State of
California Government Code, Section 6500. The authority exists under a Joint Exercise of Power
Agreement dated October 8, 1991, between the City of Poway and the Poway Redevelopment Agency. '
Its purpose is to assist in financing and refinancing projects for the benefit of the City and the Agency.
Him I
Poway, from Indian words meaning "where the waters meet," first gained prominence in the 1800s as
an important link in Southern California's stagecoach network. Today the City is a thriving, civic - spirited
community, located in the coastal foothills of San Diego County, just twenty miles north of downtown '
San Diego and three miles east of Interstate 15.
The City of Poway flourishes with a family- oriented population of 48,155 and covers 39 square miles '
with elevations ranging from 450 to 2,250 feet above sea level. Poway is a full - service general -law city
governed by a council of five members -at -large serving staggered four -year terms. In 1990, the City
had its first mayor directly elected by the voters. The City absorbed existing special districts as of '
February 1, 1981. The City provides water, sewage collection, fire, paramedic, parks and recreation,
planning and building, street maintenance, and redevelopment services. Law enforcement services are
contracted through the San Diego County Sheriff's Department, and wastewater treatment is provided '
by the City of San Diego.
Poway is predominately a single - family community that has the lowest crime rate in the County. The
Poway Unified School District is a top performer in the State and nation, and is a source of great pride
for the City.
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' Annual Financial Report
January 13, 2012
' Page vii
As part of San Diego County, Poway has a relatively dry climate with frost -free temperatures over 300
' days per year, and rainfall of about 10 inches, which falls principally between October and April. The
average daytime temperature in Poway is about 74° F.
Poway has been popularly dubbed the "City in the Country." Poway has set aside over 65 percent of
total land use as open space, nearly 3,000 acres of dedicated public open space, 568 acres of
developed parkland featuring community parks and centers, and 82 miles of riding and hiking trails.
Poway has the second highest median household income in San Diego County, at $105,099 for 2011.
Home lots are often larger than in most other areas, with a median sales price of $385,000 in June
2011. Like many areas of the country, especially in Southern California, the June 2011 median sales
price represents a 20.8% decrease from the June 2010 median sales price of $486,250 but is
comparable to the June 2009 median sales price of $373,500. While Poway has not been immune to
the national downturn in housing prices, Poway's property tax base has not been materially affected as
of this date.
' Economic Condition and Outlook
While official economic growth indicators confirmed that the recession had officially ended during 2010,
the rippling effects of the global recession continued to adversely influence governments, businesses,
and households throughout the year. For the City of Poway, continued fiscal challenges meant a
concentrated effort to maintain the level of services and programing that the residents of Poway have
come to expect. It also meant exercising the discipline to refrain from any new spending outside of the
' City's core work program.
The City has been additionally challenged by the State's recent efforts to eliminate redevelopment. On
June 28, 2011, Governor Brown signed several budget trailer bills to implement the State Budget for
Fiscal Year 2011 -2012. These bills included AB X1 26, which immediately suspended all new
redevelopment activities and dissolved redevelopment agencies effective October 1, 2011, and AB X1
27 that allowed redevelopment agencies to avoid dissolution, if their host cities /counties elected to
comply with the alternative redevelopment program and committed to making certain payments to the
State beginning in January 2012. Although the City opted to participate in the alternative program and
make payments to the State, the California Supreme Court rendered a decision on December 29, 2011
upholding the constitutionality of Assembly Bill X1 26 and striking down AB X1 27. As a result of this
decision, the Redevelopment Agency will be replaced by the City of Poway as a successor agency.
The successor agency will be governed by an independent oversight board charged with "winding
down" the agency's affairs and disposing of all of its assets. The tax increment that the Agency
formerly received would continue to be used for servicing the bonded indebtedness of the agency, with
the residual being shared among local tax receiving entities in the same manner as the normal property
taxes. The City of Poway will see an increase in property taxes, as it shares with other local taxing
agencies in the division of the former tax increment. The full fiscal implications of AB X1 26 will be
understood in greater clarity as the legislation is implemented.
In anticipation of the Governor's attempt to eliminate redevelopment agencies statewide, the City acted
to protect its assets and community interests. In March 2011, the Redevelopment Agency transferred
all non - housing related assets to the City and all housing related assets to the newly created Poway
Housing Authority through cooperation agreements. Under the terms of the agreements, the City and
the Housing Authority agree to respectively carry out the projects and activities of the Agency.
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Annual Financial Report ,
January 13, 2012
Page viii '
Despite such daunting realities, the City has fundamental reasons for optimism. Its dedicated and
tireless employees, well maintained public infrastructure, honored education system, and creative and
committed residents will help the City meet the challenges ahead. ,
The City has made strategic cuts to the General Fund totaling $3.7 million over the last two years.
Additional budgetary savings were achieved when employees began contributing toward their pension '
costs in FY 2009 -10 and increased their contributions in the following fiscal years. By the beginning of
FY 2011 -12, non - safety employees were contributing 7% of their salaries and safety employees were
contributing 9% of their salaries toward pension costs. Additionally, bargaining agreements were in
place with all employee groups agreeing to second -tier pension for new employees hired after January
2012. We are proud of the pension reform the City achieved with the collaboration and support of its
employees.
General fund revenues for FY 2010 -11 came in above midyear projections and realized the first year -
over -year increase since FY 2007 -08. Operating expenditures came in under budget. From the
resulting surplus, the City Council elected to prepay a portion of the City's share of cost increases in the
general liability and workers' compensation pool funds. The Council also restored the general fund
contribution to the Capital Facilities Fund. Lastly, the Council recognized the need to purchase
additional emergency equipment following an extended county -wide power outage in September. ,
The City plans to continue to assess and evaluate its budget quarterly and will make additional
adjustments as necessary to ensure a sustainable budget. Sales tax revenues began to recover in
2011, making increases each quarter from the previous year. Property taxes were not as dramatically
affected in the region as they were elsewhere, and have regained their pre- recession levels. The
unemployment rate in Poway was 6.1 % when measured in March of 2011, about half of the statewide '
figure at the time.
Long Term Financial Planning: The unassigned general fund balance exceeds the City Council
policy minimum (25% of general fund operating expenditures). Additional committed fund balances
have been established in the general fund to protect against economic uncertainty ($3.1 million), to
provide pension stabilization ($2.4 million), and to ensure street maintenance ($4.5 million). '
The City's long term plans include the proposed construction of the Michael P. Cafagna Community
Facility and Senior Center in Community Park. Construction costs were originally planned to be
financed by the issuance of redevelopment bonds. This financing method may be unavailable,
depending on the outcome of a case currently being considered by the California Supreme Court, and
future actions by the State of California. When the Community Facility and Senior Center is built, the
City of Poway will incur significant new costs to operate and maintain the new facility.
Economic Development: Poway's local economy is based primarily on general consumer goods,
automobile and transportation related sales, and business and industry. In recent years, new retail '
development in the Poway Business Park has generated growth in our sales tax base. While
automobile sales have traditionally led the way, with the development of the Business Park, other
sectors such as business and industry and general consumer goods have helped to diversify the City's '
sales tax base. While diversification has helped, the slowdown in the larger economy, including
automobile sales, is still reflected in the City's sales tax revenue, when compared to pre- recession
years. Declines in local sales tax revenues are generally thought to have "bottomed out" and
expectations are for moderate gains to continue over the next few years.
The Business Park now represents approximately 8.9 million square feet of developed space, with an
average overall vacancy rate of 4.5 %, which is among the lowest in San Diego County through the third
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Annual Financial Report
January 13, 2012
Page ix
quarter of 2011. The Park is comprised of approximately 533 businesses, with a workforce of more
than 18,000 people. The much anticipated completion of In -N -Out and the addition of approximately
100,000 square feet to the existing Sysco facility highlight recent improvement to the Park. General
Atomics is now the largest employer in the Business Park, offering many quality jobs attracting highly
skilled and educated employees. The Business Park also attracts businesses in the biotech industry as
well as companies in the growing "clean technology" sector. These include companies like Aero -Tech
Engineering, Clean Air Power Inc., and the Sea Space Corporation. The industrial leasing market in
the Poway Business Park is considered better than the market in the rest of the county.
On January 26, 2011, the City of Poway hosted a Business Summit at the Poway Hampton Inn &
Suites in an effort to strengthen Poway's pro- business environment. The event provided a forum for
local business leaders to provide direct feedback and suggestions on City services and
communications, business -to- business opportunities, marketing, and training and networking
strategies. Following the Summit, the City partnered with the Chamber of Commerce to hold a series of
focus group meetings centered on manufacturing and distribution businesses, retailers and commercial
real estate brokers, and Chief Executive Officers of local businesses. Together, these efforts provided
good insight and ideas on how the City can continue to support the Poway business community.
IMaior Accomplishments
Public Safety: Public safety is managed by the Department of Safety Services through two entities:
' contract law enforcement with the County of San Diego Sheriff's Department and the City's Fire
Department.
t The City of Poway remains one of the safest cities in San Diego County. Poway Sheriff deputies
continued their aggressive zero - tolerance policy enforcement toward gang - related crimes. Deputies
conducted detailed documentation of known gang members and partnered with the District Attorney's
' Office to ensure gang - related crimes are prosecuted by the District Attorney's Gang Unit. The station
recently formed an internal criminal apprehension team to target those individuals identified as
significant contributors to Poway crime. "Targeting Known Offenders" (TKO) searches for potential
' violations of court ordered conditions are one of the many methods the team uses to keep criminals in
check. This team is already seeing success through arrests and the seizure of contraband. Members
of this multi- faceted team implement the latest intelligence -led policing techniques.
' Last year, traffic collisions were reduced through increased traffic enforcement operations. Deputies
analyzed crash data and altered work schedules by placing more deputies when and where collisions
were most likely to occur. Periodic re- evaluations were conducted by the Sheriffs Crime Analyst to
' insure resources were focused at the right locations to enhance safety to the public.
Deputies continued their partnership with the Poway Unified School District by providing School
' Resource Officers and increased student interaction. Several community outreach education
presentations on the abuse of Oxycontin and other related drugs were conducted. Deputies offered
monthly Smart Start driver safety education presentations targeting new and future - licensed teenage
' drivers and their parents /guardians. The station also offered a "no questions asked" prescription drug
drop box to rid households of medications that were expired or no longer needed.
' The Poway Sheriffs Station also used a Juvenile Diversion program for first time traffic offenders. It is
education based and helps by establishing a bridge between citizen and community partners.
Successful completion of the program eliminates notification of the first time offense to insurance
' companies and the Department of Motor Vehicles.
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Annual Financial Report
January 13, 2012
Page x '
A basic, but fundamental, component of reducing crime is prevention. The Poway Sheriffs Station
provided the community with the resources and expertise of a Crime Prevention Specialist who is
skilled and trained in educating the public on many programs. These include Neighborhood Watch, '
deterring burglary, residential and commercial security consultations, personal safety, identity theft
prevention, senior safety, Internet safety, and the successful City of Poway endorsed program, Crime
Free Multi- Housing, which addresses reducing crime in apartment communities. '
The Poway Fire Department is an all -risk first responder and Emergency Medical Services transport
agency which celebrated 50 years of service in 2011. The Department responds to emergency and '
non - emergency incidents including structure and vegetation fires, rescues, traffic collisions, emergency
medical services (EMS), alarms, lockouts, public assistance, events involving hazardous materials, and
requests for aid from other jurisdictions. The Department maintains an administrative office, three fire '
stations, and a fire training tower complex. Daily staffing of 17 firefighters are deployed on three
paramedic engines, one paramedic ladder truck, two paramedic ambulances, and one duty chief
officer. Firefighters cross -staff one CalEMA fire engine, one water tender, and two brush fire engines. '
In 2010, the Poway Fire Department responded to 3,801 emergency responses with approximately
70% of the incidents as Emergency Medical Services (EMS) related.
A new emergency power back -up system was installed at Fire Station #1 and ADA- compliant '
improvements were completed at Fire Station #1 and Fire Station #2. Two new replacement fire
engines were placed in service. The Department upgraded its incident pager system and replaced
33% of the Mobile Data Computers (MDC) in use on fire apparatus. These new MDCs operate at a '
faster speed and improve emergency incident management, response mapping, and resource
allocation. The Department also replaced two EKG heart monitors used by paramedics with the latest
in advanced life- saving equipment. '
Department personnel completed many projects including the updating of incident response maps,
computer use of pre- incident plans, and 1,296 business inspections. In addition, Fire Prevention staff '
completed 510 permit inspections, 41 apartment inspections, 46 educational and preschool inspections,
and 47 engine company referral inspections.
Disaster Preparedness: The City continues to improve its Emergency Planning and Disaster '
Preparedness activities. These improvements build upon the effectiveness of the Emergency
Operations Plan by maintaining up -to -date information available in the City's Emergency Operations
Center (EOC). '
Poway's Public Works Department Operations Center (PW DOC) was outfitted with a new computer
system and display technologies. The Center has also been configured with computer and '
communications technology to enable it to operate as a backup site hosting the City's information
systems, should that be necessary. The City remains committed to training employees, minimizing risk
to the effects of disasters, and providing educational opportunities to community members. Staff '
received refresher training on the use of WebEOC, AlertSanDiego emergency notification system,
Disaster Service Worker, and care and shelter operations. Personnel assigned roles in the EOC and
PW DOC participated in two disaster drills /training exercises. '
A care and shelter program is maintained with three local faith -based organizations. When combined
with the City's Community Park Care and Shelter facility, over 2,400 evacuees may be able to seek '
temporary care and shelter within Poway. The Department, in partnership with Palomar College,
conducted a Community Emergency Response Team (CERT) training course. Forty -one students
participated in the 10 -week training program. As a result, the Poway CERT program consists of 80
members divided into three separate groups. Last year, Poway CERT members participated in ten '
training sessions, three community education events, and three county -wide disaster drills.
' Annual Financial Report
January 13, 2012
' Page A
The City continued to administer the Wildfire Defensible Space Program (WDSP). This program
requires 100 feet of defensible space be cleared around habitable structures within the Wildfire Urban
' Interface Area. Staff continues to work with residents to ensure that the amount of flammable
vegetation is significantly reduced on properties.
' Community Services: The Department continues to establish new partnerships and foster existing
ones in order to provide quality services within the community. For example, staff has worked with the
Poway Kiwanis to provide a monthly art program. A local media company, Fun Flicks, sponsored a
' dive -in movie and movie in the park series. Finally, strong financial sponsorships from both Cox
Communications and the Poway Kiwanis club helped the City meet the increased need for PLAY
Scholarships, while sponsorship from Sharp Memorial Hospital brought a series of five free outdoor
' summer concerts in the parks.
The City hosted 22 different community events including: an annual summer concert in the park series,
' Old Fashioned 4th of July Fireworks, Christmas in the Park, Youth Day at the Pool, Movies in the Park,
the Family- Fun series, Art in the Park series, and new this year, Poway WinterFest.
Streamlining of programs and the creation of staffing efficiencies has been a focus this past year. Staff
' was able to reduce operational costs for programs such as the Lake Poway Day Camp and raise the
cost recovery rate for the program to 74 %.
' Redevelopment: Effective February 1, 2012, as successor agency to the Poway Redevelopment
Agency in accordance with the requirements of AB X1 26, the City of Poway and the Housing Authority
will carry out the allowable activities and projects of the former Redevelopment Agency.
In an effort to revitalize blighted parcels in the auto district located at the east end of Poway Road, the
Poway Redevelopment Agency invested $3 Million to purchase the vacant Chrysler dealership in
' September 2010. In turn, the RDA entered into a DDA with Pinnacle Realty of California, LLC which
will enable them to relocate its Toyota of Poway operations onto the former Agency -owned property
and two adjacent parcels now controlled by the City of Poway as successor agency. Once
' development of the new site is complete, Pinnacle will have invested approximately $10.1 million in site
acquisition and construction costs. This project received entitlements, with construction expected to
begin in early 2012.
' The City of Poway as successor agency is responsible for ongoing repair and maintenance of
properties previously owned by the Redevelopment Agency. These properties are reviewed regularly
to ensure that they are well- maintained and preserved. The Agency acquired a commercial office
t building located in the Town Center planning area in 2008 with the intention of removing the structure in
preparation for the Town Center development. Since that time, the Town Center project has been put
on hold due to a downturn in the economy. In order to continue to lease out this property, the City of
' Poway as successor agency will begin assessing the American with Disability Act (ADA) improvements
that will be required. Additionally, the Redevelopment Agency demolished several blighted structures
located on agency property during fiscal year 2010 -11, including three single family homes and two
' commercial structures and outbuildings.
In July 2010, the City of Poway sold the 51 -acre Poway Royal Estates Mobilehome Park to Hometown
' America for $38.3 Million. As a requirement of the sale, Hometown was given 24 months to complete
an extensive list of repairs and renovations to the Park totaling over $1,000,000 including renovation of
two clubhouse facilities and recreational areas, road work, drought tolerant landscaping, and other
' infrastructure improvements. Hometown worked diligently and completed the required work in
September 2011, well ahead of the two -year deadline.
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Annual Financial Report
January 13, 2012
Page xii '
Development Services: Staff has been working with SANDAG on the procedures for the next update
of the Housing Element of the General Plan and the allocation of the regional housing needs
assessment that will establish the number of affordable housing units that must be accommodated in '
that document. The Housing Element must be adopted by January 2013. The affordable housing
overlay zones that will implement the last Housing Element are in process and will be presented to the
City Council for adoption in February 2012. These overlay zones will provide the regulatory framework '
to achieve the affordable housing goals adopted with the Housing Element.
The Oak Knoll area improvements, which began in 2008, were completed in early November 2011. '
This project included a complete sewer line replacement, new storm drain system, streetscape
improvements, installation of landscaping, curb and gutters, sidewalks, and undergrounding of utility
lines along Oak Knoll Road. These significant infrastructure improvements now complement the '
housing renovation of Oak Knoll Villas, and the Orange Gardens affordable apartments which is
currently underway. Together, these improvements have made the Oak Knoll neighborhood a safer,
more pedestrian friendly and attractive part of our community.
June 2011 was the end of the 15-year amortization '
y period for several non - conforming properties.
General Plan Amendments were processed for some of the properties, while the others subject to
Proposition FF restrictions were notified that the non - conforming use must terminate in rural residential '
zones.
As a result of the Business Summit meeting held in January 2011, the City Council directed staff to '
update the sign regulations in the Municipal Code. City Council workshops and a neighborhood
meeting were held and staff has developed recommendations. The proposed Code revisions will be
presented to the City Council in early 2012. '
New Building Codes were adopted this year as required by the State to implement new "green" building
standards. Development entitlements were processed for three major projects: approximately 37,000 '
square foot expansion of the existing Wal -Mart, a new 152,500 square foot Lowe's home improvement
store, and the Toyota dealership relocation. An extensive Environmental Impact Report was processed
for the Wal -Mart project. Work on the Community Park Master Plan has resumed with site planning
and a schematic design prepared by the City's consultants. '
The Department is in the second year of enforcing the Wildfire Defensible Space Program. Of the initial
921 properties identified for vegetation clearing, 607 will remain in the program for annual maintenance. '
The other 314 properties were removed from the annual requirements because these properties
already had the required 100 feet of clearance and do not require annual inspections. Nearly one
hundred percent compliance was achieved in 2011. '
Major On -Going Initiatives
Energy Efficient Initiatives: A comprehensive energy audit completed in late spring 2010 identified '
and prioritized recommended energy efficiency improvement projects. Suggested projects included
replacement of selected HVAC equipment, interior and exterior lighting fixtures, and the installation of '
energy monitoring equipment to measure and verify energy savings. Additionally, the audit identified
sites best suited for the installation of renewable energy technologies to expand on -site renewable
energy generation capacity and reduce the City's energy consumption. Based on the audit results, the
City Council authorized moving forward to hire an Energy Services Company to provide design /build '
services for installation of the recommended energy efficient equipment at several City facilities.
Design is anticipated to begin in February 2012, followed by installation in the spring 2012. It is
expected that the selected projects will result in a 41.8% energy savings totaling about $58,000 in '
annual cost savings. Total project implementation cost is approximately $269,000 with about $138,000
x1i I
Annual Financial Report
January 13, 2012
' Page xiii
funded by Energy Efficiency and Conservation Block Grant ( EECBG) monies received through the
American Recovery and Reinvestment Act (ARRA), $35,000 through SDG &E incentives and rebates
and $96,000 from City capital outlay funds.
Additionally, $50,000 in EECBG funding was approved for a residential rebate program for variable
speed pool pumps and for upgrades to residential air conditioning. Poway residents responded with
over 70 applying for pool pump rebates in 2011. This number outpaces SDG &E's total regional
response of 100 applications last year. The City's program will be in place through June 2012 or until
Ifunding is exhausted
Housing: With the assistance of tax credit financing, a bank construction loan and a Poway
Redevelopment Agency contribution, construction began on the new 77 -unit affordable apartment
complex known as Brighton Place, located on Brighton Avenue near Old Poway Park on Midland Road.
' The townhome style complex will feature a Craftsman design with ample open space, energy efficient
elements and on -site resident services. Construction completion is anticipated in early 2012.
Renovations are underway at Orange Gardens, a 52 -unit apartment complex on Oak Knoll Road. In
I partnership with the Poway Housing Authority, Poway Family Housing Partners, L.P. secured tax
exempt bond financing and a Poway Housing Authority loan to make this renovation possible.
Improvements will include interior and exterior enhancements along with renovations to the private
' driveway adjacent to the apartment complex. Once complete, apartments will be available to low
income households. Construction is scheduled to be complete in summer 2012.
The Redevelopment Agency, in partnership with local non - profit housing developer Community
HousingWorks, rehabilitated the 52 -unit Oak Knoll Villas apartment complex on Oak Knoll Road. Rents
for this development were permanently converted to affordable rents for low- income households. The
' final stage of drainage enhancements and landscape upgrades is underway.
A total of 31 Meadows homes have sold, or are in escrow, and expected to close shortly. Two homes
remain available at this affordable for -sale housing development. Homes at The Meadows are
available to low- and moderate - income households and include a variety of "green" energy efficient
elements including photovoltaic systems, dual pane windows, low -flow toilets, tankless water heaters,
' energy efficient appliances, and drought - tolerant landscaping.
Water: California's water supply outlook improved during fiscal year 2010 -2011 due to increased
precipitation and snowpack in the Sierra Nevada Mountains. Due to significant conservation over the
' past few years and increased supply, the California Department of Water Resources was able to
increase water deliveries to Southern California and Metropolitan Water District (MWD) was able to
replenish its storage reservoirs. In April 2011, the City's wholesale water suppliers, MWD and the San
Diego County Water Authority (SDCWA) lifted mandatory water restrictions which began on July 1,
2009. The City of Poway discontinued its Level 2 water shortage condition on May 17, 2011.
' In June 2011, the City Council adopted the City's 2010 Urban Water Management Plan (UWMP).
Water agencies in California are required to prepare UWMPs every five years, projecting water use
demand and supply for the next 25 years. Regional water wholesalers like MWD and SDCWA, use
data from retail water agency plans to forecast regional water supply and demand. Most significantly,
Poway's most recent UWMP addresses a new State of California requirement for mandatory water
efficiency, commonly referred to as 20 by 2020, which requires that water agencies throughout
California reduce water use by 20% by 2020 based on daily per capita water use. Poway's 2020 target
is 215 gallons per capita per day. In 2006, Poway was at 282 gallons per capita per day. Thanks to
tremendous effort made by Poway residents and businesses, Poway was at 171 gallons per capita per
xiii
Annual Financial Report
January 13, 2012
Page xiv '
day for 2010. In the coming years, it will be important for Poway to maintain an overall reduction in
water use.
Water use in Poway during FY 2010 -11 is down by 36% compared to FY 2007 -08. Water conservation
during FY 2010 -11 alone decreased consumption by 6% from FY 2009 -2010. Cooler weather, the
expensive cost of water, and increased water - efficiency awareness are the likely drivers, as well as the ,
mandatory water use restrictions that were in place until May 2011.
Capital Improvement Projects (CIP): There are 10 CIP projects that are under construction, five of '
which are substantially complete. Some of the major projects that are substantially complete include
Oak Knoll Road Improvements, High Valley Pump Station and St. Andrews Pump Station. Projects
under construction include Arbolitos Sports Field Renovation and Lights, High Valley Waterline
Replacement, and Old Winery Sewer Pipeline Replacement. There are 10 CIP projects that were
completed including Veterans Park, Highlands Ranch Pump Station, and the Water Treatment Plant
Launder Replacement. '
There are currently three projects, Valle Verde Traffic Calming and Solera Way Sidewalk, ADA Barrier
Removal Old Poway Park, and Old Poway Park Maintenance Project, which are in the pre- construction
phase. These projects have a combined construction cost estimate of $526,000. ,
There are 20 CIP projects totaling approximately $7.8 million that are in various stages of design. It is
expected that construction on most of these will begin within the next two years. Some of the major '
projects currently being designed are the Sewer Master Plan Update, the Drainage Master Plan, the
Corrugated Metal Pipe Study, the Rattlesnake Creek Stream Bank Stabilization project, the Water
Treatment Plant Corrosion Repair project, and the Clearwell Redundant Pipeline. '
Independent Audit
The Government Code of the State of California requires general law cities such as Poway to be '
audited annually by independent certified public accountants selected by the City Council. This
requirement has been met and the auditors' independent report is included in this report. Also, please
refer to the Management Discussion and Analysis section for an in -depth review of this year's Financial
Statements.
GFOA Certificate of Achievement for '
Excellence in Financial Reporting
The Government Finance Officers Association of the United States and Canada (GFOA) has awarded '
a Certificate of Achievement for Excellence in Financial Reporting to the City of Poway, California, for
its comprehensive annual financial report for the fiscal year ended June 30, 2010. In order to be
awarded a Certificate of Achievement for Excellence in Financial Reporting, a government must publish
an easily readable, efficiently organized Comprehensive Annual Financial Report whose contents
conform to program standards. Such reports 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 report conforms to the program requirements, and we are
submitting it to the GFOA to determine its eligibility for the certificate.
Acknowledgments
Preparation of the City's Comprehensive Annual Financial Report is an undertaking of the
Administrative Services Department. Special credit is due to Andrew White, Finance Manager; Maria
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Annual Financial Report
January 13, 2012
Page xv
Weston, Senior Accountant; Debra Oestreich, Senior Accountant; and the entire Finance Division staff.
Their yearlong hard work and dedication have made this report possible.
We also thank the City Council for their interest and support in planning and conducting the financial
operations of the City in a responsible and progressive manner.
RPCnPrtfidly submitted_
xv
AL
John Fre
Director df A min
Services
'
City Council
Mayor
Don Higginson
'
Deputy Mayor
Jim Cunningham
Council:
Merrilee Boyack
Dave Grosch
John Mullin
'j
Appointed Officials
City Manager
Penny Riley
'
City Attorney
Morgan Foley
City Clerk
Linda Troyan
,
Administrative Personnel
Assistant City Manager
Tina White
Director of Administrative Services /Treasurer
John French
'
Director of Development Services
Robert Manis
Director of Public Works
Leah Browder
Director Community Services
Robin Bettin
,
Director of Safety Services
Mark Sanchez
t
Xvi
CITY OF POWAY
ORGANIZATION CHART
Administrative Community
Services Services
1. Human Resources 1. Leisure Services
2. Customer Services 2. Lake Operations
3. Finance
3. Aquatics Center
4. Information
4. Performing Arts
Technology
Center
5. Support Services
5. Old Poway Park
6. Risk Management
6. Library
7. Capital Management
7. Interpretive
8. Redevelopment Admin
Services
4. Law
8. Community Park
Citizens
City Council
Planning Commission
Redevelopment Agency
Housing Authority
City Manager/
Executive Director
Development
Services
City Clerk City
Attorney
Economic
Development
Public Safety
Works Services
1. Planning
1. Utility System Operations
1. Fire
2. Building
2. Water Supply
Suppression
Inspection
3. Sewer Pumping &
2. Fire Prevention
3. Capital Projects
Disposal
3. Paramedics
4. Land
4. Water Distribution
4. Law
Development
5. Wastewater Collection
Enforcement
5. Engineering
6. Reclaimed Water
Inspection
7. Maintenance Operations
6. Traff ic
8. Street Maintenance
Engineering
9. Storm Water & Flood
7. Storm Water Mgmt
Control
8. Housing Programs
10. Vehicle & Equip Maint.
11. Environmental Programs
12. Parks, Trails & Landscape
13. Facilities Maintenance
14. Special Dist & Contracts
Council
Committees
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Poway
California
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
June 30, 2010
A Certificate of Achievement for Excellence in Financial
Reporting is presented by the Government Finance Officers
Association of the United States and Canada to
government units and public employee retirement
systems whose comprehensive annual financial
reports (CAFRs) achieve the highest
standards in government accounting
and financial reporting.
President
*efpW A#
Executive Director
Xviii
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C &L
Caporicci & Larson, Inc.
A Subsidiary of Marcum LLP
Certified Public Accountants
INDEPENDENT AUDITORS' REPORT
' To the Honorable Mayor and Members of the City Council
of the City of Poway
Poway, California
We have audited the accompanying financial statements of the governmental activities, the business -type
' activities, each major fund, and the aggregate remaining fund information of the City of Poway, California
( "City "), as of and for the year ended June 30, 2011, which collectively comprise the City's basic financial
statements as listed in the foregoing table of contents. These basic financial statements are the
' responsibility of the City's management. Our responsibility is to express an opinion on these basic financial
statements based on our audit.
' We conducted our audit in accordance with auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing Standards, issued
by the Comptroller General of the United States. Those standards require that we plan and perform the
' audit to obtain reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes consideration of internal control over financial reporting as a basis for
designing audit procedures that are appropriate in the circumstances but not for the purpose of expressing
' an opinion on the effectiveness of the City's internal control over financial reporting. Accordingly, we
express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements, assessing the accounting principles used and significant
' estimates made by management, as well as evaluating the overall basic financial statement presentation.
We believe that our audit provides a reasonable basis for our opinions.
' In our opinion, the basic financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities, the business -type activities, each major fund,
and the aggregate remaining fund information of the City as of June 30, 2011, and the respective changes in
' financial position and cash flows, where applicable, thereof for the year then ended in conformity with
accounting principles generally accepted in the United States of America.
The accompanying financial statements have been prepares assuming that the Development Agency, a
component unit of the City, will continue as a going concern. As discussed in Note 19 to the basic financial
statements, on December 29, 2011, the Supreme Court of the State of California upheld the enforceability of
' legislation that provides for the dissolution of California redevelopment agencies. The full impact of this
most recent development at not known at this time. These recent legislative and judicial actions raise
substantial doubt about the ability of this agency and all redevelopment agencies in the State of California
to continue as a going concern. The financial statements do not reflect any adjustments that might result
from the outcome of this uncertainty.
I
L
Iwww.c- lcpa.com
To the Honorable Mayor and Members of the City Council
of the City of Poway
Poway, California
Page 2
The City adopted the provisions of Governmental Accounting Standards Board ( "GASB ") Statement No. 54,
Fund Balance Reporting and governmental Fund Type Definitions, as of July 1, 2010.
In accordance with Government Auditing Standards, we have also issued our report dated January 13, 2012 on
our consideration of the City's internal control over financial reporting and on our tests of its compliance
with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The
purpose of that report is to describe the scope of our testing of internal control over financial reporting and
compliance and the results of that testing, and not to provide an opinion on the internal control over
financial reporting or on compliance. That report is an integral part of an audit performed in accordance
with Government Auditing Standards and should be considered in assessing the results of our audit.
Accounting principles generally accepted in the United States of America require that the Management's
Discussion and Analysis, budgetary information and budgetary comparison schedule, and schedules of
funding progress 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 n
appropriate operational, economic, or historical context. We have applied certain limited procedures to the
required supplementary information in accordance with auditing standards generally accepted in the
United States of America, which consisted of inquiries of management about the methods of preparing the
information and comparing the information for consistency with management's responses to our inquiries,
the basic financial statements, and other knowledge we obtained during our audit of the basic financial
statements. We do not express an opinion or provide any assurance on the information because the limited
procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
comprise the City's financial statements as a whole. The accompanying supplementary information, as
listed in the table of contents, is presented for purpose of additional analysis and is not a required part of
the financial statements. Such information is the responsibility of the management and is derived from and
relates directly to the underlying accounting and other records used to prepare the financial statements.
The information has been subjected to the auditing procedures applied in the audit of the financial
statements and certain additional procedures, including comparing and reconciling such information
directly to the underlying accounting and other records used to prepare the financial statements or to 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 and Statistical Sections
have not been subjected to the auditing procedures applied in the audit of the basic financial statements
and, accordingly, we express no opinion on them.
Caporicci & Larson, Inc.
A Subsidiary of Marcum LLP
Certified Public Accountants
San Diego, California
January 13, 2012
r
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MANAGEMENT'S DISCUSSION AND ANALYSIS
As management of the City of Poway (City), we offer readers of the City's financial statements
this narrative overview and analysis of the financial activities of the City for the fiscal year ended
June 30, 2011. It should be read in conjunction with the accompanying transmittal letter
' beginning on page i and the accompanying basic financial statements. All amounts, unless
otherwise indicated, are expressed in thousands of dollars.
FINANCIAL HIGHLIGHTS
• The City's net assets increased by 18.99% to $130,764 as a result of the sale of the Poway
' Royal Mobilehome Park and of this year's operations.
• During the year, the City's revenues including program revenues, taxes, other governmental
revenues exceeded govenermental and business -type activity expenses by $20,869, again
primarily due to the sale of the Poway Royal Mobilehome Park and current year operations.
• The total revenues from all sources were $129,310.
• The total cost of all City programs was $108,441.
• Governmental net assets were $50,038.
• Business -Type net assets were $80,726.
• The General Fund reported excess revenues over expenditures and other financing uses of
$12,719.
• Actual revenues received in the General Fund were more than the final budget by $2,091
while actual expenditures were $5,736 less than final budget before other financing sources
and uses.
• At the end of the fiscal year, unassigned fund balance for the General Fund was $23,955 or
73% of total General Fund expenditures (excluding other financing uses).
USING THIS ANNUAL REPORT
This annual report consists of a series of financial statements. The three components of the
financial statements are: (1) Government -wide financial statements, which include the Statement
of Net Assets and the Statement of Activities. These statements provide information about the
activities of the City as a whole. (2) Fund financial statements describe how City services are
financed in the short term as well as what resources are available for future spending. Fund
financial statements also report the City's operations in more detail than the government -wide
statements by providing information about the City's most significant funds. (3) Notes to the
financial statements.
' Reporting the City as a Whole
The Statement of Net Assets and the Statement of Activities (Government -wide)
A frequently asked question regarding the City's financial health is whether the year's activities
contributed positively to the overall financial well - being. The Statement of Net Assets and the
Statement of Activities report information about the City as a whole and about its activities in a
way that helps answer this question. These statements include all assets and liabilities using the
accrual basis of accounting, which is similar to the accounting used by most private- sector
companies. All of the current year's revenues and expenses are accounted for regardless of when
cash is received or paid.
These two statements report the City's net assets and changes thereto. Net assets, the difference
between assets and liabilities, are one way to measure the City's financial health, or financial
position. Over time, increases or decreases in net assets are an indicator of whether the financial
health is improving deteriorating.
or However, it is important to consider other nonfinancial
factors such as changes in the City's property tax base or condition of the City's roads to
'
accurately assess the overall health of the City.
The Statement of Net Assets and the Statement of Activities present information about the
following:
certain taxes, grants, and other money. The City's two kinds of funds, governmental and
,
• Governmental activities - All of the City's basic services are considered to be governmental
activities, including general government, public safety, public works, and community
,
services. Property taxes, sales taxes, motor vehicle license fees and franchise fees finance
most of these activities.
'
• Proprietary activities/Business-type activities - The City charges a fee to customers to cover
all or most of the cost of the services provided. The City's Water and Sewer systems are
reported in this category.
'
• Component units - The City's governmental activities include the blending of two separate
legal entities: the Poway Redevelopment Agency and the Poway Housing Authority.
Although legally separate, these "component units" are important because the City is
'
financially accountable for them.
Reporting the City's Most Significant Funds
Fund Financial Statements
The fund financial statements provide detailed information about the most significant funds - not
'
the City as a whole. Some funds are required to be established by State law and by bond
covenants. However, management establishes many other funds that aid in the administration of
resources for particular purposes or to meet legal responsibilities associated with the usage of
certain taxes, grants, and other money. The City's two kinds of funds, governmental and
proprietary, use different accounting approaches as explained below.
• Governmental funds - Most of the City's basic services are reported in governmental funds.
,
Governmental funds focus on how resources flow in and out with the balances remaining at
year -end that are available for spending. These funds are reported using an accounting
method called modified accrual, which measures cash and all other financial assets that can
readily be converted to cash. The governmental fund statements provide a detailed short -
term view of the City's general government operations and the basic services it provides.
Governmental fund information shows whether there are more or fewer financial resources
that can be spent in the near future to finance the City's programs. We describe the
relationship (or differences) between governmental activities (reported in the Statement of
Net Assets and the Statement of Activities) and governmental funds through reconciliation in
Note 1 in the Notes to Basic Financial Statements.
'
• Proprietary funds - When the City charges customers for the services it provides, these
services are generally reported in proprietary funds. Proprietary funds are reported in the '
same way that all activities are reported in the Statement of Net Assets and the Statement of
Activities.
The City as Trustee '
Reporting the City's Fiduciary Responsibilities I
The City is the trustee, or fiduciary, for certain amounts held on behalf of developers, property
owners, and others. These fiduciary activities are reported in separate Statements of Fiduciary
Net Assets and Changes in Fiduciary Net Assets. The City is responsible for ensuring that the ,
n
assets are used for their intended purposes. Therefore, fiduciary activities are excluded from the
City's other financial statements because the assets cannot be used to finance operations.
'
THE CI TY AS A WHOLE
Our analysis focuses on the net assets (Table 1)
and changes in net assets (Table 2) of the City's
governmental and business activities.
'
Table 1
City of Poway Net Assets
(in Thousands)
Governmental
Activities
Business -Type
Activities
Total
2011 2010
2011
2010
2011
2010
'
Assets:
Current and
other assets $ 139,186 $ 127,520
$ 39,331 $
37,862
$ 178,517
$ 165,382
Capital assets 176,281 199,065
45,425
44,889
221,706
243,954
'
Total assets 315,467 326,585
84,756
82,751
400,223
409,336
Liabilities:
Long -term
'
debt outstanding 253,784 287,223
1,449
1,662
255,233
288,885
Other liabilities 11,645 8,576
2,581
1,980
14,226
10,556
Total liabilities 265,429 295,799
4,030
3,642
269,459
299,441
Net assets:
Invested in capital
assets, net of debt 50,255 46,412
43,976
43,226
94,231
89,638
'
Restricted 70,931 78,370
280
280
71,211
78,650
Unrestricted (71,148) (93,996)
36,470
35,603
(34,678)
(58,393
Total net asset: $ 50,038 $ 30,786
$ 80,726 $
79,109
$ 130,764
$ 109,895
The City's combined net assets for the fiscal year ended June 30, 2011, were $130,764. The City
' has chosen to account for its water and sewer operations as enterprise funds, which is shown as
Business Activities on Table 1. The City's net assets for governmental activities increased 62.5%
from $30,786 to $50,038. The following is an explanation of the governmental activity changes
' between fiscal years as shown in Table 1:
■ Current and other assets increased $11,667, or 9.2% principally due to an increase in
notes receivable for a new $10 million note related to the sale of the Poway Royal
Mobilehome Park.
■ Capital assets decreased $22,785 (net of depreciation and disposition) as detailed in
Table 4. This decrease was also primarily related to the sale of the Poway Royal
Mobilehome Park which had a value net of depreciation of $22 million.
■ Governmental long -term debt decreased $33,441. The decrease is primarily due to the
retirement of the Poway Royal bonds that had a remaining balance of $26,720 with the
remainder related to scheduled principal payments. (See Table 5 for additional detail.)
■ Other liabilities increased by a net $3.1 million. The increase was related to higher
payments by the Redevelopment Agency for tax sharing and owner participation
payments being accrued at June 30, 2011. A major factor in the calculation of these
payments is the Supplemental Educational Revenue Augmentation Fund payment which
was reduced from $13.7 million in fiscal year 2009 -10 to $2.8 million in fiscal year
2010 -11 and resulted in an increase in those payments as compared to the prior year. '
• Invested in capital assets net of debt increased $3.8 due to the amortization of debt and
additions not funded by debt.
• Restricted net assets decreased by $7,438, or 9.5 %, again due to the sale of the Poway
Royal Mobilehome Park and expenditures on capital projects. '
• Unrestricted net assets, the part of net assets that can be used to finance day -to -day
operations without constraints established by debt covenants or other legal requirements,
increased by $22.8 million, or 24.0 %, primarily due to current year operations. '
Governmental Activities
The cost of all Governmental activities this year was $82,646 as shown on Table 2 and 2.1. Of
this cost, $10,337 was paid for by those who directly benefited from the programs, $7,013 was
subsidized by grants received from other governmental organizations for both capital and '
operating activities, and $84,548 was financed through general City revenues. Overall
governmental program revenues, including intergovernmental aid and fees for services were
$17,350. Items of significance within Table 2 are:
Revenues:
• Charges for services decreased by 4.8% primarily due to the Community Services '
decrease related to the Sale of Poway Royal Mobilehome Park.
• Grants and contributions decreased by 20.9% primarily because of decreased funding for
street maintenance, decreased use of housing related grants and fewer federally funded '
projects.
• The General Revenue category increased 14.2% primarily due to the gain on the sale of
the Poway Royal Mobilehome Park and increases in sales tax. '
Expenses:
• General Government Expenses decreased $6.8 million or 28.4 %. The decrease was the
'
net result of reduced administrative expenditures and a decrease in spending on projects
for which financial assistance was provided, but that were not capitalized.
• The Public Safety line decreased by 3.0 %. There were no significant changes in this
'
category just slight decrease in law enforcement and fire suppression.
• Public Works had a small .21 % increase in expenses. There were no significant changes
in this category.
• The Development Services department decreased by $2.1 million, or 46.9 %. The
,
decrease was caused because of reduced staffing and the reduced use of outside
consultants due to less development activity. Additionally, costs were allocated to non-
governmental activities which also contributed to the decrease.
,
■ Community Services decreased by $10.8 million or 42.9 %. The decrease was the net
result of the Supplemental Educational Revenue Augmentation Fund payment being
$10.9 million lower and the related $3.6 million increase in tax shift and tax increment
payments as compared to the prior year. Finally, a $3.6 million reduction was related to
the Sale of Poway Royal.
■ Interest and fiscal charges increased $2.3 million, or 15.1 %. The increase is related to the
payment of accrued but not recorded interest on several interfund loans.
Table 2
City of Poway Changes in Net Assets
(in Thousands)
7
Governmental
Business
Total
Activities
Activities
2011
2010
2011
2010
2011
2010
Revenues:
Program revenues:
Charges for services $
10,337 $
10,858
$ 27,453 $
26,533
$ 37,790 $
37,391
Operating grants
and contributions
5,857
7,615
5,857
7,615
Capital grants
and contributions
1,155
1,247
-
4,226
1,155
5,473
General revenues:
Property taxes
50,961
51,527
-
-
50,961
51,527
Other taxes
13,197
12,472
-
-
13,197
12,472
Other
20,040
9,539
310
967
20,350
10,506
Total revenues
101,547
93,258
27,763
31,726
129,310
124,984
Expenses:
General government
17,144
23,948
17,144
23,948
Public safety
18,899
19,475
18,899
19,475
Public works
12,622
12,596
12,622
12,596
Development Svcs
2,349
4,424
2,349
4,424
Community Svcs
14,399
25,214
14,399
25,214
Interest and charges
17,233
14,969
17,233
14,969
Water
18,144
18,226
18,144
18,226
Sewer
7,651
7,523
7,651
7,523
Total expenses
82,646
100,626
25,795
25,749
108,441
126,375
Change in net assets
before transfers
18,901
(7,368)
1,968
5,977
20,869
(1,391)
Transfers
351
471
(351)
(471)
-
-
Change in net assets
after transfers
19,252
(6,897)
1,617
5,506
20,869
(1,391)
Net assets - 711
30,786
37,683
79,109
73,603
109,895
111,286
Net assets - 6130 $
50,038 $
30,786
$ 80,726 $
79,109
$ 130,764 $
109,895
7
Fiscal Year 2011
Governmental Activities
(Graphic representation of Table 2 in percentages)
Sources of Revenue
canital
!rating
rants
6%
Program Expenses
Community
Services
kkL 23%
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Interest on
Long Term
Debt
21%
_AL/III I
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Net Cost of Governmental
Activities
The City's programs
include: General Government, Public Safety,
Public Works,
and
,
Community Services.
Each program's net cost (total cost less revenues generated by
the
activities) is presented
on Table 2.1. The net cost shows the extent to which the City's general
taxes support each of the City's programs.
Table 2.1
Net Cost of Governmental Activities
(in Thousands)
Total Cost Program
Net Cost
of Services Revenues
of Services
2011 2010 2011 2010
2011
2010
General government $
17,144 $ 23,948 $ 617 $ 1,037
$ (16,527) $
(22,911)
Public safety
18,899 19,475 2,240 2,323
(16,659)
(17,152)
Public works
12,622 12,596 8,003 9,196
(4,619)
(3,400)
'
Development services
2,349 4,424 2,284 1,635
(65)
(2,789)
Community services
14,399 25,214 4,206 5,529
(10,193)
(19,685)
Interest and fiscal chgs
17,233 14,969 - -
(17,233)
(14,969)
'
Totals $
82,646 $ 100,626 $ 17,350 $ 19,720
$ (65,296) $
(80,906)
'
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$20,000
$15,000
$10,000
$5,000
$0
($5,000)
($10,000)
($15,000)
($20,000)
Total Cost of Services, Program Revenues & Net Cost
Governmental Activities (in Thousands)
Total resources available during the year to finance governmental operations were $132,684
consisting of Net Assets at July 1, 2010, of $30,786, Program Revenues of $17,350, General
Revenues of $84,197 and $351 of Transfers. Total Governmental Activities during the year were
$82,646; thus Net Assets increased by $19,252 to $50,038. As noted elsewhere the materially
large and unusual item that contributed to this increase was the sale of the Poway Royal
Mobilehome Park. Also, as discussed previously, increased sales tax and reduced expenses also
contributed to the increase in Net Assets.
Business -Type Activities
Net assets of the Proprietary Funds (Business -Type activities) at June 30, 2011, as reflected in
Table 1 were $80,726. As shown in Table 2, program revenues were $27,769, while the cost of
providing all Proprietary (Business -Type) Activities this year was $25,795 resulting in an
increase of $1,658. The net use of $61 from other revenues, non - operating activity and transfers
resulted in a Net Assets increase of $1,617 or 2.0 %. The decrease in the Water Program Revenue
is attributable to the previous fiscal year including $4 million in contributed capital related to
completed projects that were paid for by the Redevelopment Agency.
Table 2.2
Net Cost of Business Activities
(in Thousands)
Total Cost
of Services
2011 2010
Water $ 18,144 $ 18,226
Sewer 7,651 7,523
Totals $ 25,795 $ 25,749
Program
Revenue
2011 9nin
$ 18,694
8,759
$ 27,453
$ 17,882
8,652
$ 26,534
Net Cost
of Services
2011 2010
$ 550 $ (344)
1,108 1,129
$ 1,658 $ 785
Fiscal Year 2011
Total Cost of Services, Program Revenues & Net Cost — Business Activities (in thousands)
' $20,000
$15,000
' $10,000
$0
1 Water
9
13 Total Cost of Services
■ Program Revenues
■ Net Cost
Sewer
Major Funds Budgetary Highlights
'
General Fund:
'
The final appropriations for the City's General Fund at year -end were $5,331 more than actual
expenditures prior to other financing uses. The largest components of the budget to actual
variance were in the General government and Capital outlay categories. The General government
'
section includes equipment replacement and several large purchases for automobiles, trucks,
firefighting apparatuses and copiers were delayed which contributed to the variance. In regards
to the Capital outlay category, it was under budget because several projects have been budgeted
and are only just starting or are partially complete. All of the expenditure categories were under
'
budget primarily due the City's across the board efforts to control expenditures. Overtime costs
continued to be lower than expected and the City's law enforcement contract with the County of
San Diego
also was lower than expected which resulted in this category's under budget variance.
'
Actual revenues compared favorably to the final budget resulting in a $2,091 positive variance
(excluding other financing sources). The major variances were in Taxes, Intergovernmental,
Charges for services, Developer Fees and Other Revenue. The Taxes actual was higher than
'
budgeted primarily because of the uptick in sales tax combined with property taxes also doing
better than expected. The Intergovernmental category was higher because the State of California
reconciled the amounts owed to cities for previous year's motor vehicle in -lieu fees and made
additional payments for funds owed. Charges for services were under budget because the
'
administrative fees related to equipment replacement were low because those anticipated
purchases were not made during the fiscal year. More development related review work was
performed in -house so the Developer fee category was higher than expected. Finally the Other
'
Revenue category exceeded its budget because donations for various City projects including
Veteran's Park and the Blue Sky Amplitheater. During the fiscal year the City continued to
produce quarterly budget updates in addition to its traditional midyear budget update in order to
enhance focus on the City's financial position and the current factors that were affecting that
'
position.
Redevelopment Agency:
'
Because the State of California proposed to eliminate or "disestablish" redevelopment agencies
as part of its plan to balance the state's budget the Agency transferred its housing assets to the
'
city's new Housing Authority and capital project assets to the city. The Housing Authority fund
appears as a Major Fund and the Capital Project fund is included in the Non -Major Funds
combining schedules. As a result there is activity in both the redevelopment housing and capital
'
projects funds previous to the transfer and in the city housing and capital projects funds after the
transfer. The end result was that both the Agency's housing and capital projects funds have a
zero fund balance as of June 30, 2011. As for the Agency's debt service fund, it remained
'
relatively unchanged though an effort was made to use all available resources to pay down its
Advances from City of Poway balance to the greatest possible extent. See the notes to the
Financial Statements for a further discussion of the State's actions and redevelopment.
'
Agency Housing/City Housing Authority Special Revenue Funds:
As previously mentioned the Agency's Housing fund transferred all of its assets to the City's '
Housing Authority fund. When comparing the Agency's Housing fund's June 30, 2010, fund
balance to the City's Housing Authority fund's fund balance at June 30, 2011, there is a $2.8 '
million increase. However, at the end of fiscal year 2010 -11 74% of the fund balance was
committed to projects while at the end of fiscal year 2009 -10 it was 66 %. Depending upon the
to '
' outcome of California's Redevelopment litigation the City plans on continuing to use these funds
to improve the quantity and quality of affordable housing in the City.
' Redevelopment Capital Project /City Capital Project Funds:
' The remaining funds in the Agency's Capital Project fund were transferred to a new City Capital
Project fund. When comparing the Agency's Capital Project fund's June 30, 2010, fund balance
to the City's June 30, 2011, fund balance there is a decrease of $9.8 million. The decrease in the
t comparative fund balance is attributable to the repayment of previously loaned and unspent
funds and to the fact that there was no new significant funding, such as from the issuance of tax
allocation bonds. Proceeds from previous bond funds continued to be spent on projects.
' City of Poway Redevelopment Agency Debt Service Fund:
Though this fund's fund balance was relatively stable between fiscal years, increasing by
approximately $350,000, there was significant unusual activity. Funds were transferred -in from
the sale of the Poway Royal Mobilehome Park to pay off the remaining principal and interest on
t those bonds. Additionally, other available redevelopment funds were transferred -in to repay
advances from other City funds. The Agency was required to make a Supplemental Educational
Revenue Augmentation Fund (SERAF) payment of $2.8 million in fiscal year 2010 -11. Also, as
' further discussed in the notes to the financial statements, the City has elected to opt -in to the
Alternative Voluntary Redevelopment Program. As such an Alternative Voluntary
Redevelopment Program payment of $10,252,000 will be due for fiscal year 2011 -12.
'
Poway Royal al Mobilehome Park Fund:
' The City purchased the Poway Royal Mobilehome Park in 1991 at the request of Park residents.
The City's goals were to stabilize rents, ensure the Park was properly maintained, and preserve
' Poway Royal as part of the continuum of reasonably priced housing in the community. The
City's intent has always been to transfer the Park to private ownership. The Park's sale to
Hometown America was completed in July 2010. Hometown America paid $38,300,000 for the
' Park, accepted the City's required rent guarantees, and agreed not to raise rent for two years
while completing a list of Park renovations and repairs. As part of the sale, the 1995 Certificates
of Participation with a remaining balance of $26,720,000 were retired and the City received a
' note receivable from Hometown America for $10,000,000.
Other Governmental funds:
' There was no unusual activity in the Other Governmental grouping of funds during the fiscal
year. The Storm Water Management Fund's negative fund balance was reduced by
' approximately 21 % and the remainder of the negative fund balance was expected to be recouped
over the next several years. However, as mentioned in the notes to the financial statements the
Storm Water fee was discontinued in October 2011 and those operations, as well as the negative
fund balance, will be funded by the General Fund.
11
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CAPITAL ASSET AND DEBT ADMINISTRATION
'
Capital Assets
t
The capital assets of the City are those assets that are used in the performance of City functions.
Capital Assets include land, buildings, park facility improvements, infrastructure, equipment and
vehicles. Land decreased by a net $16.7 million due to the sale of the Poway Royal Mobile
'
Home Park ($21.7 million) netted with land purchases of $5.0 million for affordable housing and
commercial revitalization. Improvements increased by $4.0 million and Construction in
Progress decreased by $4.0 million primarily due to the completion of water and sewer pipeline
'
projects. Depreciation on capital assets is recognized in the Government -Wide financial
statements. (See Table 4 & Note III, C to the financial statements)
'
Table 4
City of Poway Capital Assets at Year -End
(Net of Depreciation)
'
(In Thousands)
Governmental Business
Total
Activities Activities
'
2011 2010 2011 2010 2011 2010
Land $ 56,203 $ 72,902 $ 77 $ 77 $ 56,280 $ 72,979
Buildings 38,690 40,654 5,489 5,954 44,179 46,608
'
Improvements 4,676 5,173 35,679 31,132 40,355 36,305
Infrastructure 57,512 60,651 - - 57,512 60,651
Equip & Vehicles 7,525 7,342 868 986 8,393 8,328
'
Construction in Prog 11,675 12,344 3,312 6,739 14,987 19,083
$ 176,281 $ 199,066 $ 45,425 $ 44,888 $ 221,706 $ 243,954
'
Debt
At year -end, the City had $253,784 in governmental -type debt and $1,448 in Proprietary debt.
'
During the year the Poway Royal Mobilehome Park was sold and the related 1995 Certificates of
Participation balance of $26,720,000 was paid -off in full. No other bonds were refunded so,
therefore, the other decreases in bond balances were due to scheduled principal payments and
'
premium /discount amortizations. The Loans Payable balance increased because accrued interest
related to the operating covenant with AZ Poway, LLC (dba Mossy Nissan) was greater than the
payment made under the covenant. Finally, the Compensated Absences balances had minor
changes, but again there was no unusual activity. See the Notes to the Basic Financial
'
Statements, number 5, Long -term Debt for additional information.
Table 5
'
City of Poway Outstanding Debt at Year -End
(In Thousands)
Governmental Business Total
Activities Activities
'
2011 2010 2011 2010 2011 2010
Tax Allocation Bonds $ 228,957 $ 234,987 - - $ 228,957 $ 234,987
Certificates of Participation 20,871 48,454 - - 20,871 48,454
'
Revenue Bonds - - $ 1,182 $ 1,381 1,182 1,381
Loans Payable 2,542 2,401 - - 2,542 2,401
Comp Absences 1,414 1,384 266 282 1,680 1,666
'
Total $ 253,784 $ 287,226 $ 1,448 $ 1,663 $ 255,232 $ 288,889
12
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INEXT YEAR'S BUDGET AND ECONOMIC FACTORS
' In considering the City Budget for fiscal year 2011 -2012, the City Council and management
continued to be cautious but do expect a modest recovery in the local economy. Property taxes
have remained stable and sales tax has increased and is expected to continue to increase at a
' moderate level. General Fund revenue is budgeted to increase by 7.5% from the fiscal year 2010-
11 revenue budget. The increase is primarily due to increased budgets for property tax and sales
tax based upon the actual performance of these revenues in fiscal year 2010 -11. General Fund
expenditures are budgeted to decrease by approximately 1%. The reduction was not due to any
' significant program changes, but rather due to the continued refinement of department budgets
and also considering fiscal year 2010 -11 savings that were anticipated to be sustained into fiscal
year 2011 -12. The City continues to monitor the local, state and national economic situation and
' is prepared to address those situations if they arise. The Poway Redevelopment Agency has
elected to "opt -in" under ABx1 -27 and depending upon the outcome of the current litigation over
this legislation intends to continue its operations. Also, subsequent to the adoption of the budget
' the City discontinued its storm water fee that funded approximately $1.3 million of related storm
water program expenditures. The storm water program is being reorganized and this will result in
the General Fund absorbing approximately an additional $1 million of storm water program
expenditures during fiscal year 2011 -12. The City had initially projected a $600,000 excess for
' the fiscal year and through a combination of revenue increases and expenditure decreases
expects to be able to absorb these expenditures without using reserves.
' CONTACTING THE CITY'S FINANCIAL MANAGEMENT
This financial report is designed to provide our citizens, taxpayers, customers, investors, and
creditors with a general overview of the City's finances and to show the City's fiduciary
' responsibility for the funds it receives. If you have questions about this report or need additional
financial information, contact the City's Finance Department, at the City of Poway, 13325 Civic
Center Drive, Poway, California 92064 or online: http: / /www.poway.org
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BASIC FINANCIAL STATEMENTS
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GOVERNMENT -WIDE
FINANCIAL STATEMENTS
1.7
City of Poway
Statement of Net Assets
June 30, 2011
ASSETS
Current assets:
Cash and investments
Cash and investments with fiscal agents
Receivables:
Taxes
Accounts
Interest
Due from other governments and agencies
Prepaid items
Inventories
Total current assets
Noncurrent assets:
Lease receivable
Notes receivable
Internal balances
Loans to Business Park Fiduciary Fund
Deferred charges, net
Capital assets:
Nondepreciable assets
Depreciable assets, net
Total capital assets
Total noncurrent assets
Total assets
18
Primary Government
Governmental Business -Type
Activities Activities
Total
$ 96,190,357 $
29,038,192
$ 125,228,549
20,490,124
280,450
20,770,574
3,403,478
-
3,403,478
599,006
4,642,752
5,241,758
983,825
-
983,825
1,114,899
-
1,114,899
24,366
-
24,366
106,339
2,244,031
2,350,370
122,912,394
36,205,425
159,117,819
374
-
374
17,998,331
-
17,998,331
(2,247,668)
2,247,668
-
-
850,000
850,000
523,349
27,892
551,241
67,877,734
3,388,488
71,266,222
108,402,808
42,036,498
150,439,306
176,280,542
45,424,986
221,705,528
192,554,928
48,550,546
241,105,474
315,467,322
84,755,971
400,223,293
'
City of Poway
Statement of Net Assets, Continued
June 30, 2011
'
Primary Government
Governmental
Business -Type
Activities
Activities
Total
'
LIABILITIES
Current liabilities:
'
Accounts payable
$ 10,346,742
$ 2,512,334 $
12,859,076
Accrued liabilities
333,597
333,597
Accrued interest payable
962,376
10,908
973,284
'
Deposits
2,100
58,157
60,257
Long -term debt - due within one year
7,258,386
262,518
7,520,904
'Total
current liabilities
18,903,201
2,843,917
21,747,118
Noncurrent liabilities:
Long -term debt - due in more than one year
246,526,099
1,186,206
247,712,305
'
Total noncurrent liabilities
246,526,099
1,186,206
247,712,305
Total liabilities
265,429,300
4,030,123
269,459,423
'
NET ASSETS
in capital assets, net of related debt
50,255,141
43,976,262
94,231,403
'Investments
Restricted for:
Special revenue:
Streets
4,915,219
-
4,915,219
'
Drainage
4,868,152
4,868,152
Maintenance districts
6,659,102
-
6,659,102
'
Grants
2,682,361
-
2,682,361
Miscellaneous
17,048
17,048
Affordable housing
20,421,109
-
20,421,109
'
Debt service
18,495,915
280,450
18,776,365
Capital improvement projects
12,783,201
12,783,201
Permanent:
'
Expendable
89,266
-
89,266
Total restricted
70,931,373
280,450
71,211,823
'
Unrestricted
(71,148,492)
36,469,136
(34,679,356)
Total net assets
$ 50,038,022
$ 80,725,848 $
130,763,870
See accompanying Notes to Basic Financial Statements.
19
City of Poway
Statement of Activities and Changes in Net Assets
For the year ended June 30, 2011
Functions/Programs
Primary government:
Governmental activities:
General government
Public safety
Public works
Development services
Community services
Interest and fiscal charges
Total governmental activities
Business -Type activities:
Water
Sewer
Total business -type activities
Total primary government
Expenses
$ 17,144,376 $
18,899,606
12,622,204
2,348,622
14,398,426
Program Revenues
Charges Operating Capital Total
for Grants and Grants and Program
Services Contributions Contributions Revenues
96,397
$ 520,492 $
2,121,984
118,367
4,422,522
3,577,755
1,584,838
699,139
2,111,476
941,607
82,645,876 10,337,217
18,143,829 18,694,318 -
7,651,228 8,759,001 -
$ 616,889
2,240,351
2,238 8,002,515
- 2,283,977
1,153,146 4,206,229
1,155,384 17,349,961
18,694,318
25,795,057 27,453,319 - - 27,453,319
$ 108,440,933 $ 37,790,536 $ 5,857,360 $ 1,155,384 $ 44,803,280
See accompanying Notes to Basic Financial Statements.
20
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City of Poway
Statement of Activities and Changes in Net Assets, Continued
For the year ended June 30, 2011
II Functions/Programs
II
II
11
Primary government:
Governmental activities:
General government
Public safety
Public works
Development services
Community services
Interest and fiscal charges
Total governmental activities
Business -Type activities:
Water
Sewer
Total business -type activities
Total primary government
General revenues:
' Taxes:
Property taxes
Sales taxes
Motor vehicle license taxes
Transit occupancy taxes
Franchise taxes
t Other taxes
Total taxes
Investment earnings
' Gain (loss) on sale of assets
Miscellaneous
Transfers
Total general revenues and transfers
Change in net assets
Net assets - beginning of year, as restated (See Note 18)
Net assets - end of year
If
Net (Expense) Revenue and
Changes in Net Assets
Primary Government
Governmental Business -Type
Activities Activities Total
$ (16,527,487) $
-
$ (16,527,487)
(16,659,255)
-
(16,659,255)
(4,619,689)
-
(4,619,689)
(64,645)
-
(64,645)
(10,192,197)
-
(10,192,197)
(17,232,642)
-
(17,232,642)
(65,295,915)
-
(65,295,915)
5,964,802
254,279
6,219,081
-
550,489
550,489
-
1,107,773
1,107,773
-
1,658,262
1,658,262
(65,295,915)
1,658,262
(63,637,653)
50,960,736
-
50,960,736
10,418,322
-
10,418,322
262,412
-
262,412
433,934
-
433,934
1,465,926
-
1,465,926
616,466
-
616,466
64,157,796
-
64,157,796
5,964,802
254,279
6,219,081
13,561,625
-
13,561,625
512,858
55,363
568,221
350,874
(350,874)
-
84,547,955
(41,232)
84,506,723
19,252,040
1,617,030
20,869,070
30,785,982
79,108,818
109,894,800
$ 50,038,022
$ 80,725,848
$ 130,763,870
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Governmental Fund Financial Statements
Proprietary Fund Financial Statements
Fiduciary Fund Financial Statements
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FINANCIAL STATEMENTS
25
City of Poway
Balance Sheet
Governmental Funds
June 30, 2011
ASSETS
Cash and investments
Receivables:
Taxes
Notes
Accounts
Interest
Lease
Due from other funds
Due from other governments
Prepaid items
Inventories, at cost
Advances to other funds
Restricted assets:
Cash and investments with fiscal agents
Total assets
LIABILITIES AND
FUND BALANCES
Liabilities:
Accounts payable
Accrued liabilities
Due to other funds
Deposits
Deferred revenue
Advances from other funds
Total liabilities
Fund Balances:
Nonspendable
Restricted
Committed
Assigned
Unassigned
Total fund balances
Total liabilities and fund balances
Major Funds
Low and
City of Poway
Moderate
Redevelopment
Redevelopment
Income Housing
Agency
Area Housing
Special Revenue
Debt Service
Capital Project Authority
General Fund
Fund
Fund Fund
$ 35,701,935 $
2,889,627
10,020,403
251,777
866,657
735,558
281,441
24,366
106,339
3,805,762
13,700 $ 5,183,590 $ 184,912 $ 20,346,712
390,078 - 100,020
116,228 - -
4,705 - -
- - 18,992,814 - _
$ 54,683,865 $ 13,700 $ 24,687,415 $ 184,912 $ 20,446,732
$ 3,721,148 $ 13,700 $ 5,563,144 $ 184,912 $ 23,523
333,597 - _ - -
- - - - 2,100
18,413 - -
- - 4,834,626 - _
4,073,158 13,700 10,397,770 184,912 25,623
10,151,108 - _
- - 14,289,645 - 20,421,109
10,037,638 - _
6,466,719 -
23,955,242 - _ _ _
50,610,707 - 14,289,645 - 20,421,109
$ 54,683,865 $ 13,700 $ 24,687,415 $ 184,912 $ 20,446,732
See accompanying Notes to Basic Financial Statements.
26
City of Poway
Balance Sheet
Governmental Funds, Continued
June 30, 2011
Major Fund
Poway Royal
Other
Total
'
Mobilehome
Governmental
Governmental
Park
Funds
Funds
ASSETS
Cash and investments
$ -
$ 28,500,843
$ 89,931,692
Receivables:
Taxes
-
23,753
3,403,478
Notes
7,977,928
17,998,331
Accounts
-
345,682
597,459
Interest
-
940
983,825
'
Lease
374
374
Due from other funds
-
-
735,558
Due from other governments
-
828,753
1,114,899
'
Prepaid items
24,366
Inventories, at cost
106,339
Advances to other funds
-
17,576
3,823,338
Restricted assets:
Cash and investments with fiscal agents
1,497,310
20,490,124
Total assets
$ -
$ 39,193,159
$ 139,209,783
LIABILITIES AND
FUND BALANCES
'
Liabilities:
Accounts payable
$
$ 793,484
$ 10,299,911
Accrued liabilities
-
-
333,597
Due to other funds
-
735,558
735,558
Deposits
2,100
Deferred revenue
-
207,118
225,531
Advances from other funds
-
1,236,380
6,071,006
Total liabilities
2,972,540
17,667,703
Fund Balances:
Nonspendable
10,151,108
Restricted
-
27,744,437
62,455,191
Committed
-
-
10,037,638
'
Assigned
-
8,564,840
15,031,559
Unassigned
(88,658)
23,866,584
Total fund balances
-
36,220,619
121,542,080
Total liabilities and fund balances
$
$ 39,193,159
$ 139,209,783
See accompanying Notes to Basic Financial Statements.
27
City of Poway
Reconciliation of the Governmental Funds Balance Sheet
to the Government -Wide Statement of Net Assets
June 30, 2011
Total Fund Balances - Total Governmental Funds
Amounts reported for governmental activities in the Statement of Net Assets were different because:
Capital assets used in governmental activities were not financial resources and therefore were not reported in
governmental funds.
Nondepreciable
Depreciable, net of accumulated depreciation
Total capital assets
Deferred charges, such as bond issuance costs from issuing debt, were expenditures in the fund financial statements but
were deferred and subject to capitalization and amortization on the Government -Wide Statement of Net Assets.
Long -term liabilities were not due and payable in the current period and therefore were not reported in the governmental
funds.
Long -term liabilities - due within one year
Long -term liabilities - due in more than one year (net of $27,595 reported in Internal Service Fund)
Total long -term liabilities
0
$ 121,542,080 '
67,877,734
108,402,808
176,280,542
523,349
(7,258,386)
(246,498,504)
(253,756,890)
0
Interest payable on long -term debt did not require current financial resources. Therefore, interest payable was not reported
as a liability in Governmental Funds Balance Sheet. (962,376)
Deferred revenues recorded in governmental fund financial statements resulting from activities in which revenues were
earned but funds were not available were recognized as revenues in the Government -Wide Financial Statements. 225,531 '
Internal service funds were used by management to charge the costs of certain activities to individual funds. The assets
and liabilities of the internal service funds were included in governmental activities in the Government -Wide Statement of
Net Assets. 6,185,786
Net Assets of Governmental Activities
$ 50,038,022
See accompanying Notes to Basic Financial Statements. 1
28
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29
City of Poway
Statement of Revenues, Expenditures and Changes in Fund Balances
Governmental Funds
For the year ended June 30, 2011
EXPENDITURES:
Current:
General government
2,680,162
727,856
Major Funds
2,534,136
280,539
Public safety
18,264,668
Low and
City of Poway
_
_
Public works
3,133,475
Moderate
Redevelopment
Redevelopment
-
Development Services
2,388,077
Income Housing
Agency
Area
Housing
Community services
4,452,500
Special Revenue
Debt Service
Capital Projects
Authority
Capital outlay
General
Fund
Fund
Fund
Fund
REVENUES:
Taxes
$ 24,263,657
$ 7,803,052
$ 31,212,209
$ -
$ -
Licenses and permits
457,905
-
-
-
_
Intergovernmental
555,947
-
-
_
_
Charges for services
841,629
-
-
117,017
-
Fines and forfeitures
678,468
-
-
-
_
Use of money and property
1,965,035
28,373
616,391
-
239,985
Developer fees
3,469,785
-
-
-
_
Assessment levied
-
_
_
_
_
Other revenues
499,815
125,013
-
4,215
7,812
Total revenues
32,732,241
7,956,438
31,828,600
121,232
247,797
EXPENDITURES:
Current:
General government
2,680,162
727,856
-
2,534,136
280,539
Public safety
18,264,668
_
_
_
_
Public works
3,133,475
-
-
-
-
Development Services
2,388,077
-
-
-
_
Community services
4,452,500
-
-
-
-
Capital outlay
1,937,038
4,279,020
-
6,087,567
2,452,744
Debt service:
Principal
-
-
32,495,000
-
-
Interest and fiscal charges
-
-
16,868,986
-
94,125
Tax increment reimbursement
-
-
5,948,554
_
_
Tax shift
-
-
2,820,770
-
_
Total expenditures
32,855,920
5,006,876
58,133,310
8,621,703
2,827,408
REVENUES OVER (UNDER) EXPENDITURES
(123,679)
2,949,562
(26,304,710)
(8,500,471)
(2,579,611)
OTHER FINANCING SOURCES (USES):
Proceeds from sale of property
_
_
_
Issuance of debt
-
-
169,930
-
-
Transfers in
15,502,350
4,154,297
37,077,848
6,708,499
24,065,401
Transfers out
(2,660,155)
(24,742,785)
(10,592,023)
(19,720,753)
(1,064,681)
Total other financing sources (uses)
12,842,195
(20,588,488)
26,655,755
(13,012,254)
23,000,720
NET CHANGE IN FUND BALANCE
12,718,516
(17,638,926)
351,045
(21,512,725)
20,421,109
FUND BALANCES:
Beginning of year, as restated (See Note 19)
End of year
37,892,191 17,638,926 13,938,600 21,512,725 -
$ 50,610,707 $ - $ 14,289,645 $ - $ 20,421,109 '
See accompanying Notes to Basic Financial Statements.
30
City of Poway
' Statement of Revenues, Expenditures and Changes in Fund Balances
Governmental Funds, Continued
' For the year ended June 30, 2011
n
II
Major Fund
Poway Royal Other
Mobilehome Governmental
Park Funds
Total
Governmental
See accompanying Notes to Basic Financial Statements.
31
REVENUES:
$
$
3,344,888
$ 66,623,806
'Taxes
Licenses and permits
_
457,905
Intergovernmental
-
1,244,198
1,800,145
for services
194,115
2,079,460
3,232,221
'Charges
Fines and forfeitures
678,468
Use of money and property
11,029
4,960,919
7,821,732
Developer fees
-
1,046,458
4,516,243
'Assessment
levied
-
11902,409
1,902,409
Other revenues
284
92,794
729,933
Total revenues
205,428
14,671,126
87,762,862
EXPENDITURES:
Current:
'
General government
-
872,910
7,095,603
Public safety
63,619
18,328,287
Public works
-
6,856,893
9,990,368
Development Services
-
=
2,388,077
'
Community services
1,026,404
5,478,904
Capital outlay
-
2,062,452
16,818,821
Debt service:
'
Principal
-
928,020
33,423,020
Interest and fiscal charges
1,009,008
17,972,119
Tax increment reimbursement
-
-
5,948,554
Tax shift
-
-
2,820,770
'
Total expenditures
1,026,404
11,792,902
120,264,523
REVENUES OVER (UNDER) EXPENDITURES
(820,976)
2,878,224
(32,501,661)
OTHER FINANCING SOURCES (USES):
from sale of property
38,300,000
-
38,300,000
'Proceeds
Issuance of debt
169,930
Transfers in
2,411,150
14,979,318
104,898,863
Transfers out
(44,125,581)
(1,161,085)
(104,067,063)
'
Total other financing sources (uses)
(3,414,431)
13,818,233
39,301,730
NET CHANGE IN FUND BALANCE
(4,235,407)
16,696,457
6,800,069
FUND BALANCES:
Beginning of year, as restated (See Note 19)
4,235,407
19,524,162
114,742,011
'
End of year $
- $
36,220,619
$ 121,542,080
See accompanying Notes to Basic Financial Statements.
31
City of Poway
Reconciliation of the Governmental Statement of Revenues, Expenditures, and Changes
in Fund Balances to the Government -Wide Statement of Activities and Changes in Net Assets
For the year ended June 30, 2011
Net Change in Fund Balances - Total Governmental Funds
Amounts reported for governmental activities in the Statement of Activities were different because:
Governmental funds report capital outlay as expenditures. However, in the Government -Wide Statement of
Activities and Changes in Net Assets, the cost of those assets was allocated over their estimated useful lives as
depreciation expense. This is the amount of capital assets recorded in the current period.
Depreciation was reported in the Government -Wide Statement of Activities and Changes in Net Assets, but they
did not require the use of current financial resources. Therefore, depreciation and amortization expense was not
reported as expenditures in governmental funds.
Disposal of City's property provides current financial resources to governmental funds, but disposal of capital
asset decrease capital assets in the Government -Wide Statement of Net Assets.
Compensated absences were reported in the Government -Wide Statement of Activities and Changes in Net
Assets, but it did not require the use of current financial resources. Therefore, compensated absences were not
reported as expenditures in governmental funds. This amount represent the change in compensated absences
from prior year.
Issuance costs from issuing debt were expenditures at the fund level but were deferred and subject to
capitalization and amortization on the statement of net assets.
Amortization of bond issuance costs
Proceeds from long -term debt provide current financial resources to governmental funds, but issuing debt
increases long -term liabilities in the Government -Wide Statement of Net Assets. Repayment of bond principal
was an expenditure in governmental funds, but the repayment reduces long -term liabilities in the Government -
Wide Statement of Net Assets.
Proceeds from loans
Repayment of contract and notes payable
Principal payment
Amortization on bond premium was reported in the Government -Wide Statement of Activities and Changes in
Net Assets, but it did not require the use of current financial resources. Therefore, amortization was not
reported as expenditures in governmental funds.
2003 Tax Allocation Bonds
2007 Tax Allocation Bonds
2003 Certificates of Participation
2005 Certificates of Participation
Interest expense on long -term debt was reported in the Government -Wide Statement of Activities and Changes
in Net Assets, but they did not require the use of current financial resources. This amount represents the change
in accrued interest from prior year
Prior year accruals
Current year accruals
Revenues in the statement of activities that did not provide current financial resources are not reported as
revenues in the funds.
Internal service funds were used by management to charge the costs of certain activities, such as insurance and
fleet management, to individual funds. The net revenue of the internal service funds was reported with
governmental activities.
Change in Net Assets of Governmental Activities
See accompanying Notes to Basic Financial Statements.
32
1,701,853
(962,376)
$ 6,800,069
8,486,878 '
(6,533,304)
(24,738,375) '
(116,957)
(23,834) '
(169,930)
28,434 '
33,423,020
191,162
63,517 '
9,241
9,019
739,477 '
160,799 '
922,824 ,
$ 19,252,040
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PROPRIETARY FUND
FINANCIAL STATEMENTS
33
City of Poway
Statement of Net Assets
Proprietary Funds
June 30, 2011
See accompanying Notes to Basic Financial Statements.
34
Governmental
Activities
Major Funds
Internal
Water
Sewer
Total
Service Fund
ASSETS
Current assets:
Cash and investments
$ 8,013,246
$ 21,024,946 $
29,038,192
$ 6,258,665
Cash and investments with fiscal agents
280,450
-
280,450
-
Receivables:
Accounts
3,230,305
1,412,447
4,642,752
1,547
Inventories
2,229,424
14,607
2,244,031
-
Total current assets
13,753,425
22,452,000
36,205,425
6,260,212
Noncurrent assets:
Advances to other funds
-
2,247,668
2,247,668
-
Advances to Fiduciary Fund - Business Park
-
850,000
850,000
-
Deferred charges
27,892
-
27,892
-
Capital assets:
Nondepreciable
2,396,728
991,760
3,388,488
-
Depreciable
55,945,511
34,531,823
90,477,334
-
Less accumulated depreciation
(31,661,153)
(16,779,683)
(48,440,836)
-
Total net capital assets
26,681,086
18,743,900
45,424,986
-
Total noncurrent assets
26,708,978
21,841,568
48,550,546
-
Total assets
40 ,462,403
44,293,568
84,755,971
6,260,212
LIABILITIES
Current liabilities:
Accounts payable
2,390,047
122,287
2,512,334
46,831
Deposits
58,157
-
58,157
-
Accrued interest payable
10,908
-
10,908
-
Long -term debt due within one year
247,158
15,360
262,518
-
Total current liabilities
2,706,270
137,647
2,843,917
46,831
Noncurrent liabilities:
Long -term debt due in more than one year
1,162,238
23,968
1,186,206
27,595
Total noncurrent liabilities
1,162,238
23,968
1,186,206
27,595
Total liabilities
3,868,508
161,615
4,030,123
74,426
NET ASSETS
Invested in capital assets, net of related debt
25,271,690
18,704,572
43,976,262
-
Restricted for debt service
280,450
-
280,450
-
Unrestricted
11,041,755
25,427,381
36,469,136
6,185,786
Total net assets
$ 36,593,895
$ 44,131,953 $
80,725,848
$ 6,185,786
See accompanying Notes to Basic Financial Statements.
34
City of Poway
'
Statement of Revenues, Expenses and Changes in Net Assets
Proprietary Funds
For the year ended June 30, 2011
'
'
Governmental
Activities
Major Funds
Internal
Water
Sewer
Total
Service Fund
OPERATING REVENUES:
'Charges
for services
$ 18,615,425
$ 8,205,724
$ 26,821,149
$ 2,373,738
Connection fees
78,893
553,277
632,170
Other
48,431
6,932
55,363
24,089
'
Total operating revenues
18,742,749
8,765,933
27,508,682
2,397,827
EXPENSES:
'OPERATING
Personnel services
2,946,819
454,989
3,401,808
344,206
Maintenance and operations
4,581,508
6,160,688
10,742,196
711,627
of purchased water
9,324,624
-
9,324,624
-
'Cost
Depreciation
1,290,878
1,035,551
2,326,429
Total operating expenses
18,143,829
7,651,228
25,795,057
1,055,833
'
OPERATING INCOME (LOSS)
598,920
1,114,705
1,713,625
1,341,994
'
NONOPERATING REVENUES (EXPENSES):
Interest revenue
79,605
251,950
331,555
61,756
Interest expense and fiscal charges
(77,276)
-
(77,276)
-
'
Total nonoperating revenues (expenses)
2,329
251,950
254,279
61,756
'
INCOME (LOSS) BEFORE CONTRIBUTED CAPITAL AND TRANSFERS
601,249
1,366,655
1,967,904
1,403,750
CONTRIBUTED CAPITAL AND TRANSFERS:
'
Transfers out
(202,192)
(148,682)
(350,874)
(480,926)
Total contributed capital and transfers
(202,192)
(148,682)
(350,874)
(480,926)
'
Change in
399,057
1,217,973
1,617,030
922,824
net assets
'NET
ASSETS:
Beginning of year
36,194,838
42,913,980
79,108,818
5,262,962
'
End of year
$ 36,593,895
$ 44,131,953
$ 80,725,848
$ 6,185,786
'
See accompanying Notes to Basic Financial Statements.
35
City of Poway
Statement of Cash Flows
Proprietary Funds
For the year ended June 30, 2011
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash receipts from customers
Cash received to/ from other funds
Cash paid to employees for services
Cash paid to suppliers for goods or services
Others
Net cash provided (used) by operating activities
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:
Transfers in
Transfers out
Net cash provided (used) by noncapital financing activities
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES:
Acquisitions to capital assets
Principal paid on long -term debt
Payment of interest and fees
Net cash provided (used) by capital and related financing activities
CASH FLOWS FROM INVESTING ACTIVITIES:
Interest income
Net cash provided (used) by investing activities
Net increase (decrease) in cash and investments
CASH AND INVESTMENTS:
Beginning of year
End of year
RECONCILIATION OF CASH AND INVESTMENTS
TO THE STATEMENT OF NET ASSETS
Cash and investments
Cash with investments with fiscal agents
Total cash and investments
RECONCILIATION OF OPERATING INCOME (LOSS) TO NET
CASH PROVIDED (USED) BY OPERATING ACTIVITIES:
Operating income (loss)
Adjustments to reconcile operating income (loss) to
net cash provided (used) by operating activities:
Depreciation
Changes in operating assets and liabilities:
Accounts receivable
Inventories
Deferred charges
Advances to other funds
Accounts payable
Deposits
Total adjustments
Net cash provided (used) by operating activities
See accompanying Notes to Basic Financial Statements.
36
Goverrunental
Activities
Major Funds Internal
Water Sewer Total Service Fund
$ 18,657,711 $ 8,963,822 $ 27,621,533 $ 2,396,280
2,606,354
3,365,455
5,971,809 -
(2,946,819)
(454,989)
(3,401,808) (344,206)
(14,073,739)
(6,105,573)
(20,179,312) (907,568)
48,431
6,932
55,363 -
4,291,938
5,775,647
10,067,585 1,144,506
(202,192) (148,682) (350,874) (480,926)
(202,192) (148,682) (350,874) (480,926)
n
(2,116,825)
(745,992)
(2,862,817)
5,536,532
'
(212,191)
(1,671)
(213,862)
(3,203)
(79,060)
-
(79,060)
61,756
(2,408,076)
(747,663)
(3,155,739)
58,553
280,450
-
280,450
-
'
79,605
251,950
331,555
-
'
79,605
251,950
331,555
-
3,693,018
4,660,942
8,353,960
(197,488)
'
1,761,275
5,131,252
6,892,527
722,133
6,532,421
15,893,694
22,426,115
5,536,532
'
$ 8,293,696 $
21,024,946
$ 29,318,642
$ 6,258,665
(713,119)
(3,300)
(716,419)
-
8,013,246
21,024,946
29,038,192
6,258,665
280,450
-
280,450
-
$ 8,293,696 $
21,024,946
$ 29,318,642
_$ 6,258,665
'
$ 598,920 $ 1,114,705 $ 1,713,625 $ 1,341,994 t
1,290,878
1,035,551
2,326,429
(42,352)
204,821
162,469
(1,547)
(713,119)
(3,300)
(716,419)
-
6,437
-
6,437
2,606,354
3,365,455
5,971,809
-
539,075
58,415
597,490
(195,941)
5,745
-
5,745
-
3,693,018
4,660,942
8,353,960
(197,488)
'
$ 4,291,938 $
5,775,647
$ 10,067,585
$ 1,144,506
FIDUCIARY FUND
FINANCIAL STATEMENTS
' Agency funds are used to account for assets held by the City as an agent for individuals, private
organizations, other governments, and /or other funds.
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37
City of Poway
Statement of Fiduciary Net Assets
Fiduciary Funds
June 30, 2011
Agency
ASSETS
Cash and investments
$
7,352,379
Receivables:
Taxes
8,171
Accounts
850,000
Interest
21,363
Cash and investments with fiscal agent
1,712,014
Total assets
$
9,943,927
LIABILITIES
Accounts payable
$
109,627
Deposits
3,406,663
Due to bondholders
5,577,637
Advances from City of Poway
850,000
Total liabilities
$
9,943,927
See accompanying Notes to Basic Financial Statements.
38
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NOTES TO BASIC
FINANCIAL STATEMENTS
39
City of Poway
Notes to Basic Financial Statements
For the year ended June 30, 2011
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The basic financial statements of the City of Poway, California, (the "City ") have been prepared in
conformity with generally accepted accounting principles ( "GAAP ") as applied to governmental agencies.
The Governmental Accounting Standards Board ( "GASB ") is the accepted standard setting body for
establishing governmental accounting and financial reporting principles. The more significant of the City's
accounting policies are described below.
A. Financial Reporting Entity
r
The City was incorporated December 1, 1980, under the general laws of the State of California. The City
operates under a Council- Manager form of government and provides the following services: public '
safety (police - through the County of San Diego, and fire), community services, engineering services,
planning services, public works, general administrative services, and capital improvements.
As required by generally accepted accounting principles in the United States, these basic financial
statements present the City and its component units, entities for which the City is considered to be
financially accountable. The City is considered to be financially accountable for an organization if the
City appoints a voting majority of that organizations governing body and either the City is able to
impose its will on that organization or there is a potential for that organization to provide specific
financial benefits to or impose specific financial burdens on the City. The City is also considered to be
financially accountable for an organization if that organization is fiscally dependent (i.e., it is unable to
adopt its budget, levy taxes, set rates or charges, or issue bonded debt without approval from the City).
In certain cases, other organizations are included as component units if the nature and significance of
their relationship with the City are such that their exclusion would cause the City's financial statements
to be misleading or incomplete. Component units for which the City is considered financially
accountable are described below:
Poway Redevelopment Agenci�
The Poway Redevelopment Agency (the "Agency ") was established on April 26, 1983 pursuant to
the State of California Health and Safety Code, Section 33000 entitled "Community Redevelopment
Law ". Its purpose is to eliminate blighted areas by encouraging the development of residential,
commercial, industrial, recreational and public facilities. The Agency was included within the scope
of the reporting entity of the City because its governing body is composed in its entirety of council
members of the City. Separate financial statements can be obtained from the Poway Finance
Department located at Poway City Hall.
Poway Public Financing Authority
The Poway Public Financing Authority (the "Authority ") is a joint powers authority organized
pursuant to the State of California Government Code, Section 6500. The Authority exists under a
Joint Exercise of Power Agreement dated October 8, 1991, between the City and the Agency. Its
purpose is to assist in financing and refinancing projects for the benefit of the City and the Agency.
The Authority was included within the scope of the reporting entity of the City because its
governing body is composed in its entirety of council members of the City. Separate financial
statements are not prepared.
40
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City of Poway
' Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
A. Financial Reporting Entity, Continued
Housing Authority
' On March 1, 2011, the City Council of the City of Poway declared a need for a housing authority in
the City of Poway and adopted a resolution forming the Poway Housing Authority (the "Housing
' Authority "). The creation of the Housing Authority provides the City legal authority to continue
monitoring ongoing rent and income compliance at affordable housing developments. The Housing
Authority was included within the scope of the reporting entity of the City because its governing
' body is composed in its entirety of council members of the City. Separate financial statements can
be obtained from the Poway Finance Department located at Poway City Hall.
IB. Basis of Accounting and Measurement Focus
The accounting policies of the City conform to generally accepted accounting principles in the United
' States for local governmental units. The accounts of the City are organized on the basis of funds, each of
which is considered a separate accounting entity. The operations of each fund are accounted for by
providing a separate set of self - balancing accounts that comprise its assets, liabilities, fund equity,
revenues and expenditures or expenses, as appropriate. Governmental resources are allocated to and
accounted for in individual funds based upon the purpose for which they are to be spent and means by
which spending activities are controlled.
Government - Wide and Fund Financial Statements
' The City's Government -Wide Financial Statements include a Statement of Net Assets and a Statement of
Activities and Changes in Net Assets. These statements present summaries of governmental and
business -type activities for the City accompanied by a total column.
' These basic financial statements are p resented on an "economic resources" measurement focus and the
accrual basis of accounting. Accordingly, all of the City's assets and liabilities, including capital assets,
' as well as infrastructure assets, and long -term liabilities, are included in the accompanying Statement of
Net Assets. The Statement of Activities presents changes in net assets. Under the accrual basis of
t accounting, revenues are recognized in the period in which they are earned while expenses are
recognized in the period in which the liability is incurred.
' Certain types of transactions are reported as program revenues for the City in three categories:
• Charges for services
' Operating grants and contributions
• Capital grants and contributions
C
41
City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
B. Basis of Accounting and Measurement Focus, Continued
Government - Wide and Fund Financial Statements Continued
Certain eliminations have been made as prescribed by GASB Statement No. 34 in regards to interfund
activities, payables and receivables. All internal balances in the Statement of Net Assets have been
eliminated except those representing balances between the governmental activities and the business-
type activities, which are presented as internal balances and eliminated in the total primary government
column. In the Statement of Activities, internal service fund transactions have been eliminated;
however, those transactions between governmental and business -type activities have not been
eliminated. The following interfund activities have been eliminated:
• Due to and from other funds
• Advances to and from other funds
• Transfers in and out
Private - sector standards of accounting and financial reporting issued prior to December 1, 1989,
generally are followed in both the government -wide and proprietary fund financial statements to the
extent that those standards do not conflict with or contradict guidance of the Governmental Accounting
Standards Board. Governments also have the option of following subsequent private - sector guidance of
their business -type activities and enterprise funds, subject to this limitation. The government has elected
not to follow subsequent private - sector guidance.
Governmental Fund Financial Statements
Governmental fund financial statements include a Balance Sheet and a Statement of Revenues,
Expenditures and Changes in Fund Balances for all major governmental funds and non -major funds
aggregated. An accompanying schedule is presented to reconcile and explain the differences in fund
balances as presented in these statements to the net assets presented in the government -wide financial
statements. The City has presented all major funds that met those qualifications.
All governmental funds are accounted for on a spending or "current financial resources" measurement
focus and the modified accrual basis of accounting. Accordingly, only current assets and current
liabilities are included on the balance sheets. The Statement of Revenues, Expenditures and Changes in
Fund Balances present increases (revenues and other financing sources) and decreases (expenditures
and other financing uses) in fund balances. Under the modified accrual basis of accounting, revenues
are recognized in the accounting period in which they become both measurable and available to finance
expenditures of the current period.
Revenues are recorded when received in cash, except that revenues subject to accrual (generally 60 days
after year -end) are recognized when due. The primary revenue sources, which have been treated as
susceptible to accrual by the City, are real and personal property tax, other local taxes, franchise fees,
forfeitures and penalties, motor license fees, rents and concessions, interest revenue, and state and
federal grants and subventions. Expenditures are recorded in the accounting period in which the
related fund liability is incurred except for interest on long -term debt, claims and judgments, and
compensated absences, which are recorded only when due.
42
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' City f Poway
Y
' Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
' 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
' B. Basis of Accounting and Measurement Focus, Continued
Governmental Fund Financial Statements, Continued
' Deferred revenues arise when potential revenues do not meet both the "measurable" and "available"
criteria for recognition in the current period. Deferred revenues also arise when the government
' receives resources before it has a legal claim to them, as when grant monies are received prior to
incurring qualifying expenditures. In subsequent periods when both revenue recognition criteria are
met or when the government has a legal claim to the resources, the deferred revenue is removed from
' the balance sheet and revenue is recognized.
The Reconciliation of the Fund Financial Statements to the Government -Wide Financial Statements is
' provided to explain the differences created by the integrated approach of GASB Statement No. 34.
The City reports the following major governmental funds:
' The General Fund is the general operating fund of the City. It is used to account for all financial
resources except those required to be accounted for in another fund.
tThe Low and Moderate Income Housin g Special ecial Revenue Fund is used to account for funds
' restricted for low and moderate income housing financial activity.
The City of Poway Redevelopment Agency Debt Service Fund is used to account for the
' accumulation of resources for, and the payment of principal, interest, and related costs of the debt.
The Redevelopment Agency Capital Project Fund is used to account for the financial resources to
' be used for the acquisitioned construction of major capital facilities (other than those financed by
proprietary funds).
' The Housing Authority Fund is used to account for funds restricted for financing the City's
Housing Agency activity to carry out the projects and activities with the objectives and purposes
included in the Redevelopment and Implementation Plans.
' The Poway Royal Mobilehome Park Fund is used to account for revenues received and
expenditures made in the administration of the Royal Mobilehome Park.
' Proprietary Fund Financial Statements
' Proprietary fund financial statements include a Statement of Net Assets, a Statement of Revenues,
Expenses and Changes in Net Assets, and a Statement of Cash Flows for all proprietary funds.
' A separate column representing internal service funds is also presented in these statements. However,
internal service balances and activities have been combined with the governmental activities in the
government -wide financial statements.
43
City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
B. Basis of Accounting and Measurement Focus, Continued
Proprietary Fund Financial Statements, Continued
Proprietary funds are accounted for using the "economic resources" measurement focus and the accrual
basis of accounting. Accordingly, all assets and liabilities (whether current or noncurrent) are included
on the Statement of Net Assets. The Statement of Revenues, Expenses and Change in Fund Net Assets
presents increases (revenues) and decreases (expenses) in total net assets. Under the accrual basis of
accounting, revenues are recognized in the period in which they are earned while expenses are
recognized in the period in which liability is incurred.
Operating revenues in the proprietary funds are those revenues that are generated from the primary
operations of the fund. All other revenues are reported as non - operating revenues. Operating expenses
are those expenses that are essential to the primary operations of the fund. All other expenses are
reported as non - operating expenses.
The City reports the following major proprietary funds:
The Water Enterprise Fund is used to account for the provision of water services to the residents of
the City. All activities necessary to provide such services are accounted for in this fund, including,
but not limited to administration, operations, maintenance, financing and related debt service, and
billing and collection.
The Sewer Enterprise Fund is used to account for the provision of sewer services to the residents of
the City. All activities necessary to provide such services are accounted for in this fund, including,
but not limited to administration, operations, maintenance, financing and related debt service, and
billing and collection.
Fiduciary Fund Financial Statements
Fiduciary fund financial statements include a Statement of Net Assets. The City's fiduciary funds
represent agency funds. Agency funds are custodial in nature (assets equal liabilities) and use the
accrual basis of accounting, but do not involve measurement of results of operations.
C. Cash, Cash Equivalents and Investments
The City pools its available cash for investment purposes. The City considers pooled cash and highly
liquid investments held with financial institutions, a fiscal agent, and in a pooled account with the State,
to be cash equivalents.
In accordance with GASB Statement No. 31, Accounting and Financial Reporting for Certain Investments and
for External Investment Pools, highly liquid market investments with maturities of one year or less at time
of purchase are stated at amortized cost. All other investments are stated at fair value. Market value is
used as fair value for those securities for which market quotations are readily available.
,.
n
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n
' City f Poway
Y
' Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
' 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
' C. Cash, Cash Equivalents and Investments, Continued
The City participates in an investment pool managed by the State of California titled Local Agency
' Investment Fund (LAIF) which has invested a portion of the pooled funds in structured notes and asset -
backed securities. LAIF's investments are subject to credit risk with the full faith and credit of the State
of California collateralizing these investments. In addition, these Structured Notes and Asset - Backed
' Securities are subject to market risk as to change in interest rates.
In accordance with GASB Statement No. 40, Deposit and Investment Risk Disclosures (an amendment of
GASB Statement No. 3), the City adheres to certain disclosure requirements, if applicable for deposit and
' investment risk are specified for the following areas:
Interest Rate Risk
' ➢ Credit Risk
Overall
Custodial Credit Risk
' . Concentration of Credit Risk
Foreign Currency Risk
' The cash flow statements require presentation of "cash and cash equivalents." For the purposes of the
statement of cash flows, the City considers all proprietary fund pooled cash and investments as "cash
and cash equivalents," as such funds are available to the various funds as needed. With respect to cash
' and investments with fiscal agents, the City considers all investments with an original maturity of less
than three months to be cash equivalents.
' D. Inter fund Transactions
Activity between funds that are representative of lending/ borrowing arrangements outstanding at the
' end of the fiscal year are referred to as "due to /from other funds" (i.e., current portion of interfund
loans). Any residual balances outstanding between the governmental activities and business -type
activities are reported in the governmental -wide financial statements as "interfund balances."
' E. Inventories
Inventories within the various fund types consist of water, materials and supplies which are valued at
cost on a first -in, first -out basis. Reported expenditures reflecting the purchase of supplies have been
restated to reflect the consumption method of recognizing inventory- related expenditures. A
reservation of fund balance has been reported in the governmental funds to show that inventories do
' not constitute "available spendable resources," even though they are a component of net current assets.
F. Capital Assets
' Capital assets, which include property, plant, equipment and infrastructure assets (e.g., roads, streets,
sidewalks, medians and storm drains), are reported in the applicable governmental or business -type
' activities in the Government -Wide Financial Statements. City policy has set the capitalization threshold
for reporting capital assets at $5,000. Capital assets are valued at historical cost or estimated historical
cost if actual historical cost was not available. Donated assets are valued at their estimated fair market
' value on the date donated.
45
City of Poway
Notes to Basic Financial Statements, Continued '
For the year ended June 30, 2011
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
F. Capital Assets, Continued I
Depreciation is recorded on a straight -line basis over estimated useful lives of the assets as follows:
Buildings 10 -50 years '
Buildings improvements 10 -100 years
Furniture and Equipment 5 -20 years '
Infrastructure 20 -50 years
The City defines infrastructure as the basic physical assets that allow the City to function. These assets ,
include streets, bridges, sidewalks, drainage systems, and lighting systems, etc. Each major
infrastructure system can be divided into subsystems. For example the street system can be subdivided
into pavement, curb and gutters, sidewalks, medians, streetlights, landscaping and land. These '
subsystems are not delineated in the basic financial statements. The appropriate operating department
maintains information regarding the subsystems.
For infrastructure systems, the City elected to use the "Basic Approach" as defined by GASB Statement '
No. 34 for infrastructure reporting. The City commissioned an appraisal of City owned infrastructure
and property as of June 30, 2006. This appraisal determined the original costs, which are defined as the ,
actual cost to acquire new property in accordance with market prices at the time of first
construction/ acquisition. Original costs were developed in one of three ways: (1) historical records;
(2) standard unit costs appropriate for the construction/ acquisition date; or (3) present cost indexed by '
a reciprocal factor of the price increase from the construction/ acquisition date to the current date. The
accumulated depreciation, defined as the total depreciation from the date of construction/ acquisition to
the current date on a straight line, unrecovered cost method was computed using industry accepted life '
expectancies for each infrastructure subsystem. The book value was then computed by deducting the
accumulated depreciation from the original cost.
Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest '
on construction- related debt incurred during the period of construction for business -type and
proprietary fund assets is capitalized as a cost of the constructed assets. Capital assets acquired under '
capital lease are capitalized at the net present value of the total lease payments.
Capital Assets Acquired Under Lease Purchase Contracts I
The long -term principal portion of debt on non - proprietary capital assets acquired through lease
purchase contracts is accounted for in the government -wide financial statements as "capital lease '
obligations." A capital asset is recorded at the net present value of total lease payments in the
government -wide financial statements.
G. Compensated Absences '
Government -Wide Financial Statements I
For governmental and business -type activities, compensated absences are recorded as incurred and the
related expenses and liabilities are reported. '
46
' City Poway
�Y o Y
' Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
1 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued
IG. Compensated Absences, Continued
Fund Financial Statements
' In governmental funds, compensated absences are recorded as expenditures in the years paid, as it is
the City's policy to liquidate any unpaid compensated absences at June 30 from future resources, rather
' than currently available financial resources. In proprietary funds, compensated absences are expensed
to the various funds in the period they are earned, and such fund's share of the unpaid liability is
recorded as a long -term liability of the fund. Vested or accumulated compensated absences are
' recorded in proprietary funds as an expense and liability of those funds as the benefits accrue to
employees.
IH. Long -Term Debt
Government -Wide Financial Statements
' Long -term debt and other long -term obligations are reported as liabilities in the appropriate activities.
' 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 applicable premium or
discount. Issuance costs are reported as deferred charges.
' Fund Financial Statements
' The governmental fund financial statements do not present long -term debt but are shown in the
Reconciliation of the Governmental Funds Balance Sheet to the Government -Wide Statement of Net
Assets.
' L Net Assets
In the governmental -wide financial statements and proprietary fund financial statements, net assets are
classified as follows:
Invested in Capital Assets, Net of Related Debt - This amount consists of capital assets net of
' accumulated depreciation and reduced by outstanding debt that attributed to the acquisition,
construction, or improvement of the assets.
' Restricted Net Assets - This amount is restricted by external creditors, grantors, contributors, or laws
or regulations of other governments.
' Unrestricted Net Assets - This amount is all net assets that do not meet the definition of "invested in
capital assets, net of related debt" or "restricted net assets."
' When expenses are incurred for purposes for which both restricted and unrestricted net assets are
available, the City's policy is to apply restricted net assets first, then unrestricted net assets as they are
needed.
47
City of Poway
Notes to Basic Financial Statements, Continued '
For the year ended June 30, 2011
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued I
J. Fund Balances I
In the governmental fund financial statements, fund balances are classified in the following categories:
Nonspendable - Items that cannot be spent because they are not in spendable form, such as prepaid '
items and inventories, items that are legally or contractually required to be maintained intact, such
as principal of an endowment or revolving loan funds. '
Restricted - Restricted fund balances encompass the portion of net fund resources subject to
externally enforceable legal restrictions. This includes externally imposed restrictions by creditors,
'
such as through debt covenants, grantors, contributions, laws or regulations of other governments,
as well as restrictions imposed by law through constitutional provisions or enabling legislation.
'
Committed - Committed fund balances encompass the portion of net fund resources, the use of
which is constrained by limitations that the government imposes upon itself at its highest level of
decision making, normally the governing body through council resolutions, etc., and that remain
'
binding unless removed in the same manner. The Board of Directors is considered the highest
authority for the Agency.
'
Assigned - Assigned fund balances encompass the portion of net fund resources reflecting the
government's intended use of resources. Assignment of resources can be done by the highest level
of decision making or by a committee or official designated for that purpose. The Board of Directors
'
has authorized the Executive Director for that purpose.
Unassigg e - This category is for any balances that have no restrictions placed upon them.
'
When expenditures are incurred for purposes for which both restricted and unrestricted fund balances
are available, the City's policy is to apply restricted fund balances first, then unrestricted fund balances
'
as they are needed.
When expenditures are incurred for purposes where only unrestricted fund balances are available, the
'
City uses the unrestricted resources in the following order: committed, assigned, and unassigned.
K. Use of Estimates
'
The preparation of the basic financial statements in conformity with generally accepted accounting '
principles in the United States (U.S. GAAP) requires management to make estimates and assumptions
that affect the reported amounts of certain assets and liabilities and the disclosure of contingent assets
and liabilities at the date of the basic financial statements and the related reported amounts of revenues '
and expenses during the reporting period. Actual results could differ from those estimates.
Management believes that the estimates are reasonable.
1
48 1
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City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
2. CASH, CASH EQUIVALENTS AND INVESTMENTS
The City maintains a cash and investment pool, which includes cash balances and authorized investments
of all funds. This pooled cash is invested by the City Treasurer to enhance earnings. The pooled interest
earned is allocated to the funds based on average month -end cash balances of the various funds.
The following is a summary of cash and investment at June 30, 2011:
Cash and investments
' Cash and investments with fiscal agents
Total
Government -Wide
Fiduciary
Statement of
Net Assets
Funds
Governmental
Business -Type
Statement of
Activities
Activities
Net Assets
Total
$ 96,190,357
$ 29,038,192
$ 7,352,379
$ 132,580,928
20,490,124
280,450
1,712,014
22,482,588
$ 116,680,481
$ 29,318,642
$ 9,064,393
$ 155,063,516
ICash, cash equivalents, and investments consisted of the following at June 30, 2011:
C
7
7
Cash on hand
Demand deposits
Investments
Total
A. Cash Deposits
$ 8,660
2,756,173
152,298,683
$ 155,063,516
The carrying amounts of the City's demand deposits were $2,756,173 at June 30, 2011. Bank balances at
June 30, 2011, were $4,183,991 which were fully insured or collateralized with securities held by the
pledging financial institutions in the City's name as discussed below.
The California Government Code requires California banks and savings and loan associations to secure
the City's cash deposits by pledging securities as collateral. This Code states that collateral pledged in
this manner shall have the effect of perfecting a security interest in such collateral superior to those of a
general creditor. Thus, collateral for cash deposits is considered to be held in the City's name.
The market value of pledged securities must equal at least 110% of the City's cash deposits. California
law also allows institutions to secure City deposits by pledging first trust deed mortgage notes having a
value of 150% of the City's total cash deposits. The City may waive collateral requirements for cash
deposits, which are fully insured by the Federal Deposit Insurance Corporation. The City, however, has
not waived the collateralization requirements.
The City follows the practice of pooling cash and investments of all funds, except for funds required to
be held by fiscal agents under the provisions of bond indentures. Interest income earned on pooled
cash and investments is allocated on an accounting period basis to the various funds based on the
period -end cash and investment balances. Interest income from cash and investments with fiscal agents
is credited directly to the related fund.
49
City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
2. CASH, CASH EQUIVALENTS AND INVESTMENTS, Continued
B. Investments
The table below identifies the investment types that are authorized for the City by the California
Government Code (or the City's investment policy, where more restrictive). The table also identifies
certain provisions of the California Government Code (or the City's investment policy, where more
restrictive) that address interest rate risk, credit risk, and concentration of credit risk. This table does
not address investments of debt proceeds held by bond trustee that are governed by the provisions of
debt agreements of the City, rather than the general provisions of the California Government Code or
the City's investment policy.
Authorized
Investment Type
U.S. Treasury Obligation
U.S. Agency Securities
Bankers' Acceptances
Medium -Term and Corporate Notes
Money Market Mutual Funds
Mortgage Backed Securities
Asset Backed Securities
Commercial Paper
Negotiable Certificates of Deposits
Local Agency Investment Fund (LAIF)
County of San Diego Investment Pool
CalTrust Joint Powers Authority
Obligation of any State
Maximum
Maturity
Maximum
Maximum
Percentage of
Investment in
Portfolio*
One Issuer
5 years
None
None
5 years
75%
25%
180 days
40%
5%
5 years
30%
5%
N/A
20%
10%
5 years
20%
None
5 years
20%
None
270 days
25%
3%
5 years
30%
5%
N/A
None
None
N/A
None
None
N/A
None
None
5 years
None
None
* Excluding amounts held by trustee that are not subject to California Government Code restriction.
C. Investment Authorized by Debt Agreements
Investment of debt proceeds held by bond trustee are governed by provisions of the debt agreement,
rather than the general provisions of the California Government Code or the City's investment policy.
The table below identifies certain provisions of these debt agreements that address interest rate risk,
credit risk, and concentration of credit risk.
Authorized
Investment Type
Repurchase agreement
Money Market Mutual Funds
U.S. Agency Securities
Investment Contracts
Local Agency Investment Fund (LAIF)
50
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Maximum
Maximum
Maximum
Percentage of
Investment in
Maturity
Portfolio
One Issuer
1 year
None
30%
N/A
None
None
5 years
75%
25%
30 years
None
None
N/A
None
None
50
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k
City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
2. CASH, CASH EQUIVALENTS AND INVESTMENTS, Continued
D. Risk Disclosures
Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an
investment. Generally, the longer the maturity of an investment, the greater the sensitivity of its fair
value to changes in the market interest rates. One of the ways that the City manages its exposure to
interest rate risk is by purchasing a combination of shorter term and longer term investments and by
timing cash flows from maturities so that a portion of the portfolio is maturing or coming close to
maturity evenly over time as necessary to provide the cash flow and liquidity needed for operations.
Information about the sensitivity of the fair values of the City's investments (including investments
held by bond trustee) to market interest rate fluctuations is provided by the following table that shows
the distribution of the City's investments by maturity:
Investment Type
U.S. Treasury Bills
U.S. Agencies
CalTrust Investment Pool -Short term
CalTrust Investment Pool- Medium term
Mortgage Backed
Medium -Term and Corporate Notes
Local Agency Investment Fund (LAIF)
San Diego County Investment Pool
Obligation of any State
Certificates of Deposit
Held by bond trustee:
Money Market Funds
Investment Contracts
Federal National Mortgage Association
Federal Home Loan Mortgage Corporation
U.S. Treasury Bills
Total
Amounts
5,223,614
16,601,383
19,118,810
20,757,567
836,626
16,403,452
50,671,440
7,447
145,756
50,000
1,506,158
11,073,932
1,566,724
3,089,970
Remaining Maturities
12 Months
13 to 24
25 to 60 More than
or Less
Months
Months 60 Months
$ 2,211,192
$ 1,005,860
$ 2,006,562 $ -
8,752,002
1,840,422
6,008,959 -
19,118,810
-
- -
20,757,567
-
- -
836,626
-
- -
7,083,295
4,164,622
5,155,535 -
50,671,440
-
- -
7,447
-
- -
21,028
22,237
74,681 27,810
50,000
-
- -
1,506,158 - - -
- - - 11,073,932
1,566,724 - - -
3,089,970 - -
5,245,804 -
$152,298,683 $120,918,063 $ 7,033,141 $ 13,245,737 $ 11,101,742
51
City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
2. CASH, CASH EQUIVALENTS AND INVESTMENTS, Continued
D. Risk Disclosures, Continued
Credit Risk
Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by
the assignment of a rating by a nationally recognized statistical rating organization. The following presentation is the minimum rating required
by (where applicable) the California Government Code, the City's investment policy, or debt agreements, and the actual rating as of June 30,
2011 for each investment type:
Exempt AAA/Aaa AA+ /Aa2 AA /Aa2 AA - /Aa+ A+ /A2 A/A2 A+ /Aa3 AAAf
$ - $ 5,223,614 $ S $ $ $ $ $
16,601,383
836,626
7,105,818 3,085,319 2,090,293 1,005,425 1,035,570 1,024,080 1,056,947
7,447
145,756 - - -
- 50,000
11,073,932 -
- 1,566,724
- 3,089,970
- 5,245,804 - - - - -
$ 11,219,688 $ 39,719,939 $ 3,085,319 $ 2,090,293 $ 1,005,425 $ 1,035,570 $ 1,024,080 $ 1,056,947 $ 7,447
M M M � � M
Minimum
Investment Type
Amounts
Rating
U.S. Treasury Bills
$ 5,223,614
Aaa
U.S. Agencies
16,601,383
Aaa
N CalTrust Investment Pool -Short term
19,118,810
N/A
CalTrust Investment Pool- Medium term
20,757,567
N/A
Mortgage Backed
836,626
Aaa
Medium -Term and Corporate Notes
16,403,452
Al
Local Agency Investment Fund (LAIF)
50,671,440
N/A
San Diego County Investment Pool
7,447
N/A
Obligation of any State
145,756
N/A
Certificates of Deposit
50,000
N/A
Held by bond trustee:
Money Market Funds
1,506,158
N/A
Investment Contracts
11,073,932
N/A
Federal Home Mortgage Association
1,566,724
Aaa
Federal Home Loan Mortgage Corporation
3,089,970
Aaa
U.S. Treasury Bills
5,245,804
Aaa
Total
$152,298,683
Exempt AAA/Aaa AA+ /Aa2 AA /Aa2 AA - /Aa+ A+ /A2 A/A2 A+ /Aa3 AAAf
$ - $ 5,223,614 $ S $ $ $ $ $
16,601,383
836,626
7,105,818 3,085,319 2,090,293 1,005,425 1,035,570 1,024,080 1,056,947
7,447
145,756 - - -
- 50,000
11,073,932 -
- 1,566,724
- 3,089,970
- 5,245,804 - - - - -
$ 11,219,688 $ 39,719,939 $ 3,085,319 $ 2,090,293 $ 1,005,425 $ 1,035,570 $ 1,024,080 $ 1,056,947 $ 7,447
M M M � � M
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City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
2. CASH, CASH EQUIVALENTS AND INVESTMENTS, Continued
D. Risk Disclosures, Continued
Concentration of Credit Risk
The City's Policy states that not more than 20% of the portfolio shall be invested in any one entity or
any one instrument to protect the City from concentration of credit risk, with the following exceptions:
U.S. Treasury Obligations and investments pools (State of California - Local Agency Investment Fund
and California Asset Management Program). In addition, purchases of commercial paper must not
exceed 20% of the value of the portfolio at any time and single issuer holdings must not exceed 3
percent per issuer. The City is in compliance with these provisions of the Policy.
The following is a chart of City's investment portfolio:
E. Investment in Local Agency Investment Funds
The City's investments with Local Agency Investment Funds ( "LAIF ") at June 30, 2011, included a
portion of the pooled funds invested in Medium -Term and Short -Term Structured Notes and Asset -
Backed Securities. These investments included the following:
Structured Notes are debt securities (other than asset - backed securities) whose cash flow
characteristics (coupon rate, redemption amount, or stated maturity) depend upon one or more
indices and/or that have embedded forwards or options.
Asset - Backed Securities the bulk of which are mortgage- backed securities, entitle their purchasers to
receive a share of the cash flows from a pool of assets such as principal and interest repayments
from a pool of mortgages (such as Collateralized Mortgage Obligations) or credit card receivables.
The Local Investment Advisory Board provides oversight for LAIF. The Board consists of five members
as designated by statute. The State Treasurer, as Chairman, or his designated representative appoints
two members qualified by training and experience in the field of investment or finance, and two
members who are treasurers, finance or fiscal officers or business managers employed by any county,
city or local district or municipal corporation of this state.
' As of June 30, 2011, the City had $50,671,440 invested in LAIF, which had invested 5.01 % of the pooled
investment funds in short -term and medium -term Structured Notes and Asset - Backed Securities. The
fair value of the City's position in the pool is the same as the value of the pool shares.
53
Investment
Reported
Trustee/Custodian
Type
Amount
Union Bank
U.S. Treasuries
$ 5,223,614
Union Bank
U.S. Agencies
836,626
Union Bank
CalTrust Investment Pool
39,876,377
Union Bank
Corporates
16,403,452
State Treasurer Office
LAIF
50,671,440
FSA Capital
Investment Contract
11,073,932
E. Investment in Local Agency Investment Funds
The City's investments with Local Agency Investment Funds ( "LAIF ") at June 30, 2011, included a
portion of the pooled funds invested in Medium -Term and Short -Term Structured Notes and Asset -
Backed Securities. These investments included the following:
Structured Notes are debt securities (other than asset - backed securities) whose cash flow
characteristics (coupon rate, redemption amount, or stated maturity) depend upon one or more
indices and/or that have embedded forwards or options.
Asset - Backed Securities the bulk of which are mortgage- backed securities, entitle their purchasers to
receive a share of the cash flows from a pool of assets such as principal and interest repayments
from a pool of mortgages (such as Collateralized Mortgage Obligations) or credit card receivables.
The Local Investment Advisory Board provides oversight for LAIF. The Board consists of five members
as designated by statute. The State Treasurer, as Chairman, or his designated representative appoints
two members qualified by training and experience in the field of investment or finance, and two
members who are treasurers, finance or fiscal officers or business managers employed by any county,
city or local district or municipal corporation of this state.
' As of June 30, 2011, the City had $50,671,440 invested in LAIF, which had invested 5.01 % of the pooled
investment funds in short -term and medium -term Structured Notes and Asset - Backed Securities. The
fair value of the City's position in the pool is the same as the value of the pool shares.
53
City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
2. CASH, CASH EQUIVALENTS AND INVESTMENTS, Continued
F. Investment in San Diego County Investment Pool
The City is a voluntary participant in the County Treasury Pool ( "County Pool ") which is regulated
under the oversight of the Treasurer of the County of San Diego. The fair value of the City's investment
in the County Pool is reported in the accompanying financial statements based upon the City's pro -rate
a share of the fair value provided by the County Pool for the entire portfolio. The balance available for
withdrawal is based on the accounting records maintained by the Pool. Included in the County Pool's
investment portfolio are collateralized and negotiable certificates of deposit, floating rate securities
issued by federal agencies and corporations, money market funds, repurchase agreements and
commercial paper.
At June 30, 2011, the City had $7,447 invested in the San Diego County Investment Pool.
3. INTERFUND TRANSACTIONS
A. Due To and Due From Other Funds
As of June 30, 2011, balances were as follows:
Due to other funds
Governmental Activities:
Non -major Governmental Funds
Total
Due from other funds
General
Fund Total
$ 735,558 $ 735,558
$ 735,558 $ 735,558
These balances resulted from loans to cover negative cash balances as of June 30, 2011.
B. Advances To and Advances From Other Funds
Advances to other funds
Governmental Activities:
General Fund
Non -major Governmental Funds
Business -Type Activities:
Sewer
Total
1
Advances from other funds
City of Poway
Redevelopment Agency
Non -major Fiduciary
Debt Service
Governmental Agency
Fund
Funds Funds Total
1
$ 2,801,458 $
1,004,304 $
- $ 3,805,762
-
17,576
- 17,576
'
2,033,168
214,500
850,000 3,097,668
$ 4,834,626 $
1,236,380 $
850,000 $ 6,921,006
54
City of Poway
t Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
' 3. INTERFUND TRANSACTIONS, Continued
' B. Advances To and Advances From Other Funds, Continued
The advances were primarily used for the following:
' The City Council authorized various loans to the Redevelopment Agency totaling $ 4,834,626 and to
other Non -major Governmental funds totaling $1,236,380 at various interest rates. The terms of the
loans are indefinite. Accrued interest on the loans of $5,256 and $1,058,447 respectively, are not
reflected in the accompanying basic financial statements as payment is contingent upon the
availability of tax increment. Interest is recorded when it becomes payable from available
' spendable resources.
The City's Sewer Fund loaned to the Parkway Business Center CFD No. 88 -1 Bond Deposit
' Fiduciary Agency Fund $850,000. Interest on this loan is paid on an annual basis and the
outstanding principal balance will be paid with the final assessment in 2014 -2015.
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55
City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
3. INTERFUND TRANSACTIONS, Continued
C. Transfers To and From Other Funds
Transfers for the year ended June 30, 2011, were as follows:
Transfers Out
Low and Moderate
City of Poway
Redevelopment
Royal
Income Housing
RDA
Area
Housing
MobileHome
Non -major
Water
Sewer
Internal
Special Revenue
Debt Service
Capital Projects
Authority
Park Admin
Governmental
Enterprise
Enterprise
Service
Transfers In
General Fund
Fund
Funds
Fund
Funds
Funds
Fund
Fund
Funds
Total
General Fund
$ 1,731,328 $
$
$
$
$ 12,452,921
$ 717,385
$ 86,650
$ 33,140
$ 480,926
$ 15,502,350
Low and Moderate Income Housing
Special Revenue Fund
-
4,154,298
-
-
-
-
4,154,297
City of Poway RDA
Debt Service Fund
677,384
7,373,720
1,064,681
27,518,363
443,700
37,077,848
Redevelopment Area
Capital Projects Fund
-
6,708,499
-
-
-
-
6,708,499
Housing Authority Fund
24,065,401
-
-
24,065,401
Royal MobileHome Park Admin
- -
2,411,150
-
2,411,150
Non -major Governmental
Funds
928,827 -
1,472,375
12,347,033
-
115,542
115,542
-
14,979,318
Total
$ 2,660,155 $ 24,742,785
$ 10,592,023
$ 19,720,753
$ 1,064,681
$ 44,125,581
$ 1,161,085
$ 202,192
$ 148,682
$ 480,926
$ 104,898,863
Transfers are primary used for the following:
Move revenues from the fund that statute or budget requires to collect them to the fund that statute or budget requires to expend them;
Move receipt restricted to the debt service from the funds collecting the receipts, to the debt service fund as debt service payments become
due.
Move available funds to capital project funds for approved projects.
Move available funds to new funds, or closed funds, at the direction of the Council.
City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
4. CAPITAL ASSETS
A. Government -Wide Financial Statements
Summary of changes in capital assets for governmental activities for the year ended June 30, 2011 is as
follows:
Depreciable Assets:
Building
Balance
- (1,727,361)
63,300 64,628,129
Balance
6,309,047
July 1, 2010
Additions
Deletions Reclassification
June 30, 2011
Non - Depreciable Assets:
- 139,805,234
Machinery and equipment
16,262,526
356,679 (183,970)
Land
$ 72,901,918
$ 4,954,470
$ (21,653,311) $ -
$ 56,203,077
Construction in progress
12,344,061
3,175,729
(2,730,489) (1,114,644)
11,674,657
Total non-depreciable assets
85,245,979
8,130,199
(24,383,800) (1,114,644)
67,877,734
Depreciable Assets:
Building
66,292,190
- (1,727,361)
63,300 64,628,129
Improvements other than buildings
6,309,047
- (306,418)
- 6,002,629
Infrastructure
139,805,234
- -
- 139,805,234
Machinery and equipment
16,262,526
356,679 (183,970)
1,051,344 17,486,579
Total depreciable assets, at cost
228,668,997
356,679 (2,217,749)
1,114,644 227,922,571
Less accumulated depreciation:
Building
(25,638,358)
(1,948,828)
1,648,562
- (25,938,624)
Improvements other than buildings
(1,135,964)
(221,252)
30,642
- (1,326,574)
Infrastructure
(79,154,051)
(3,138,636)
-
- (82,292,687)
Machinery and equipment
(8,921,260)
(1,224,588)
183,970
- (9,961,878)
Total accumulated depreciation
(114,849,633)
(6,533,304)
1,863,174
- (119,519,763)
Total depreciable assets, net
113,819,364
(6,176,625)
(354,575)
1,114,644 108,402,808
Total governmental activities
$ 199,065,343 $
1,953,574
$ (24,738,375) $
- $ 176,280,542
Governmental activities depreciation
expense for
capital assets for the year ended June 30, 2011 is as
follows:
General government
Public safety
Public works
Community services
Total depreciation expense
57
$ 1,601,805
934,597
3,497,556
499,346
$ 6,533,304
City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
4. CAPITAL ASSETS, Continued
A. Government -Wide Financial Statements, Continued
Summary of changes in capital assets for business -type activities for the year ended June 30, 2011 is as
follows:
Non - Depreciable Assets:
Land
Construction in progress
Total non - depreciable assets
Depreciable Assets:
Buildings
Improvements other than buildings
Machinery and equipment
Total depreciable assets, at cost
Less accumulated depreciation:
Buildings
Improvements other than buildings
Machinery and equipment
Total accumulated depreciation
Total depreciable assets, net
Total business -type activities
Balance
Balance
July 1, 2010
Additions Deletions
Reclassification
June 30, 2011
$ 76,797
$ - $ -
$ -
$ 76,797
6,739,432
2,803,345 -
(6,231,086)
3,311,691
6,816,229
2,803,345 -
(6,231,086)
3,388,488
21,076,441
- -
-
21,076,441
60,047,753
- -
6,231,086
66,278,839
3,062,582
59,472 -
-
3,122,054
84,186,776
59,472 -
6,231,086
90,477,334
(15,121,520)
(465,738) -
-
(15,587,258)
(28,915,801)
(1,683,454) -
-
(30,599,255)
(2,077,086)
(177,237) -
-
(2,254,323)
(46,114,407)
(2,326,429) -
-
(48,440,836)
38,072,369
(2,266,957) -
6,231,086
42,036,498
$ 44,888,598
$ 536,388 $ -
$ -
$ 45,424,986
Business -type activities depreciation expense for capital assets for the year ended June 30, 2011 is as
follows:
Water Enterprise Fund
Sewer Enterprise Fund
Total depreciation expense
B. Fund Financial Statements
$ 1,290,878
1,035,551
$ 2,326,429
The fund financial statements do not present general government capital assets but are shown in the
Reconciliation of the Governmental Funds Balance Sheet to the Government -Wide Statement of Net
Assets.
58
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City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
5. LONG -TERM DEBT
Summary of changes in long -term debt for the year ended June 30, 2011:
' Business -Type Activities:
Revenue Bonds $ 1,380,571 $ $ (198,177) $ 1,182,394 $ 215,000 $ 967,394
Compensated Absences 282,015 34,471 (50,156) 266,330 47,518 218,812
' Total business -type activities $ 1,662,586 $ 34,471 $ (248,333) $ 1,448,724 $ 262,518 $ 1,186,206
IA. Governmental Activities Long -Term Debt
Tax Allocation Bonds
Classif ication
'
Balance
Debt
Debt
Balance
Due Within
Due In More
July 1, 2010
Issued
Retired
June 30, 2011
One Year
Than One Year
Balance Debt
Governmental Activities:
Balance
Due Within
Due In More
July 1, 2010 Issued
Retired
'
Tax Allocation Bonds
$ 234,987,072
$
$ (6,029,679)
$ 228,957,393 $
6,180,000
$ 222,777,393
$ 5,815,000
Certificates of Participation
48,454,096
_
(27,583,260)
20,870,836
880,000
19,990,836
126,280,000 -
Notes Payable
2,400,512
169,930
(28,434)
2,542,008
-
2,542,008
2,143,033
Compensated Absences
1,383,514
224,809
(194,075)
1,414,248
198,386
1,215,862
'
Total governmental activities
$ 287,225,194
$ 394,739
$ (33,835,448)
$ 253,784,485 $
7,258,386
$ 246,526,099
' Business -Type Activities:
Revenue Bonds $ 1,380,571 $ $ (198,177) $ 1,182,394 $ 215,000 $ 967,394
Compensated Absences 282,015 34,471 (50,156) 266,330 47,518 218,812
' Total business -type activities $ 1,662,586 $ 34,471 $ (248,333) $ 1,448,724 $ 262,518 $ 1,186,206
IA. Governmental Activities Long -Term Debt
Tax Allocation Bonds
'
Tax Allocation Bonds at June 30, 2011, consisted of the
following:
'
Classification
Balance Debt
Debt
Balance
Due Within
Due In More
July 1, 2010 Issued
Retired
June 30, 2011
One Year
Than One Year
' 2000 Tax Allocation Bonds
$ 7,980,000 $ -
$ (1,425,000)
$ 6,555,000
$ 740,000
$ 5,815,000
2001 Tax Allocation Bonds
72,475,000 -
(580,000)
71,895,000
1,360,000
70,535,000
2003 Tax Allocation Bonds
126,280,000 -
(3,740,000)
122,540,000
4,050,000
118,490,000
' Bond Premium
2,334,195 -
(191,162)
2,143,033
-
2,143,033
2007 Tax Allocation Bonds
24,650,000
(30,000)
24,620,000
30,000
24,590,000
Bond Premium
1,267,877 -
(63,517)
1,204,360
-
1,204,360
' Total Tax Allocation Bonds
$ 234,987,072 $ -
$ (6,029,679)
$ 228,957,393
$ 6,180,000
$ 222,777,393
59
City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
5. LONG -TERM DEBT, Continued
A. Governmental Activities Long -Term Debt, Continued
Tax Allocation Bonds, Continued
2000 Tax Allocation Bonds
In March 2000, the Agency issued the 2000 Tax Allocation Refunding Bonds in the amount of
$39,915,000. The bonds were issued on a subordinate basis to the portion of the Agency's previously
issued $21,595,000 Paguay Redevelopment Project, Tax Allocation Refunding Bonds, Series 1990A, of
which $5,855,000 were not refunded and $4,305,000 are currently outstanding. The bonds consisted of
serial bonds of $9,940,000 maturing from 2000 to 2011 in semi - annual installments of $45,000 to $785,000
and term bonds of $29,975,000 maturing in 2033. Interest is paid semiannually on June 15 and
December 15 at rates ranging from 3.75% to 5.75 %.
0
Bonds maturing on or after June 11, 2011 are subject to optional redemption in whole or in part on any
interest payment date. Bonds maturing on June 15, 2033 are subject to mandatory redemption on each '
interest payment date beginning June 15, 2027. The outstanding balance of the bonds at June 30, 2011
was $6,555,000.
The Agency has pledged a portion of future property tax increment revenue to repay the 2000 Tax '
Allocation Refunding Bonds. The bonds required 7% of property tax increment revenue. Total
principal and interest remaining on the bond is $12,991,934 payable through 2033. '
The annual requirements to amortize the bonds outstanding at June 30, 2011, are as follows:
Year Ending
June 30,
Principal
Interest
Total
2012
$ 740,000
$ 352,863
$ 1,092,863
2013
-
334,362
334,362
2014
-
334,362
334,362
2015
-
334,362
334,362
2016
-
334,362
334,362
2017 -2021
-
1,671,810
1,671,810
2022 -2026
-
1,671,813
1,671,813
2027 -2031
3,795,000
1,255,944
5,050,944
2032 -2033
2,020,000
147,056
2,167,056
Total
$ 6,555,000
$ 6,436,934
$ 12,991,934
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City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
5. LONG -TERM DEBT, Continued
A. Governmental Activities Long -Term Debt, Continued
Tax Allocation Bonds, Continued
2001 Tax Allocation Bonds
In July 2001, the Agency issued the 2001 Tax Allocation Bonds in the amount of $76,395,000 for the
purpose of refinancing the Agency's outstanding Paguay Redevelopment Project, Subordinate Tax
Allocation Bonds of 1999, financing certain improvements, including low and moderate income housing
improvements in the Paguay Redevelopment Project Area, funding an escrow for future capital
improvement, funding a reserve account and paying the bond issuance cost. The bonds bear interest
from 3% to 5.25 %, payable semi - annually on June 15 and December 15 through 2033. Payments of the
bonds collateralized by a pledge of tax revenues to be received by the Agency. The bonds maturing on
or after June 15, 2012 are subject to redemption prior to maturity at the option of the Agency. The
outstanding balance of the bonds at June 30, 2011 was $71,895,000.
The Agency has pledged a portion of future property tax increment revenue to repay the 2001 Tax
Allocation Bonds. The bonds required 17% of property tax increment revenue. Total principal and
interest remaining on the bond is $120,964,531 payable through 2033.
The annual requirements to amortize the bonds outstanding at June 30, 2011, are as follows:
' Year Ending
June 30, Principal Interest Total
2012 $ 1,360,000 $ 3,678,455 $ 5,038,455
2013 2,200,000 3,608,461 5,808,461
2014 2,295,000 3,507,414 5,802,414
2015 2,410,000 3,395,149 5,805,149
2016 2,225,000 3,269,861 5,494,861
2017 -2021 11,950,000 14,484,570 26,434,570
' 2022 -2026 17,100,000 11,117,066 28,217,066
2027 -2031 24,110,000 5,485,089 29,595,089
2032 -2033 8,245,000 523,466 8,768,466
Total $ 71,895,000 $ 49,069,531 $ 120,964,531
r
61
City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
5. LONG -TERM DEBT, Continued
A. Governmental Activities Long -Term Debt, Continued
Tax Allocation Bonds, Continued
2003 Tax Allocation Bonds
In October 2003, the Agency issued the 2003 Series A Tax Allocation Bonds in the amount of
$150,300,000 for the purpose of refinancing the outstanding 1993 Tax Allocation Refunding Bonds in the
amount of $94,740,000, paying approximately $10,983,000 owed under two owner participation
agreements related to the properties located in the City's business parks, with one being paid in full,
providing financing for certain improvements in the Paguay Redevelopment Area, funding a reserve
account and paying the bond issuance costs. The bonds bear interest from 2.0% to 5.25% and are
payable semi - annually on June 15 and December 15 through 2033. Payment of the bonds is
collateralized by a pledge of tax revenues to be received by the Agency. The bonds maturing on or after
June 15, 2028 are subject to redemption prior to maturity at the option of the Agency. The outstanding
balance of the bonds at June 30, 2011 was $122,540,000.
The Agency has pledged a portion of future property tax increment revenue to repay the 2003 Tax
Allocation Bonds. The bonds required 40% of property tax increment revenue. Total principal and
interest remaining on the bond is $193,109,363 payable through 2033.
The annual requirements to amortize the bonds outstanding at June 30, 2011, are as follows:
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Year Ending
June 30,
Principal
Interest
Total
2012
$ 4,050,000
$ 6,155,050
$ 10,205,050
2013
4,465,000
6,003,300
10,468,300
2014
4,695,000
5,824,950
10,519,950
2015
5,010,000
5,614,300
10,624,300
2016
5,225,000
5,352,475
10,577,475
2017 -2021
30,490,000
22,367,463
52,857,463
'
2022 -2026
38,920,000
13,295,950
52,215,950
2027 -2031
18,810,000
5,262,875
24,072,875
2032 -2033
10,875,000
693,000
11,568,000
Total
$ 122,540,000
$ 70,569,363
$ 193,109,363
62
City of Poway
' Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
5. LONG -TERM DEBT, Continued
' A. Governmental Activities Long -Term Debt, Continued
Tax Allocation Bonds, Continued
' 2007 Tax Allocation Bonds
In February 2007, the Agency issued the 2007 Tax Allocation Bonds in the amount of $24,965,000 for the
purpose of refinancing a portion of the 2000 Tax Allocation Refunding Bonds, originally issued in the
principal amount of $39,915,000, of which $36,610,000 is currently outstanding (and of which
' $12,450,000 will remain outstanding upon issuance of the Bonds), finance and refinance certain
improvements in the Paguay Redevelopment Project Area and paying the bond issuance cost. The
bonds bear interest from 3.5% to 4.125% and are payable semi - annually on June 15 and December 15
' through 2033. Payments of the bonds collateralized by a pledge of tax revenues to be received by the
Agency. The bonds maturing on or before June 15, 2017 are not subject to call and optional redemption
prior to maturity. Bonds maturing on or after December 15, 2017 are subject to redemption prior to
' maturity at the option of the Agency. The outstanding balance of the bonds at June 30, 2011 was
$24,620,000.
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The Agency has pledged a portion of future property tax increment revenue to repay the 2007 Tax
Allocation Bonds. The bonds required 5% of property tax increment revenue. Total principal and
interest remaining on the bond is $47,863,205 payable through 2033.
The annual requirements to amortize the bonds outstanding at June 30, 2011, are as follows:
Year Ending
June 30, Principal Interest Total
2012
2013
2014
2015
2016
2017 -2021
2022 -2026
2027 -2031
2032 -2033
Total
$ 30,000
30,000
30,000
30,000
30,000
200,000
235,000
15,800,000
8,235,000
$ 1,224,780
1,223,708
1,222,628
1,221,525
1,220,415
6,080,455
6,037,319
4,491,000
521,375
$ 1,254,780
1,253,708
1,252,628
1,251,525
1,250,415
6,280,455
6,272,319
20,291,000
8,756,375
$ 24,620,000 $ 23,243,205 $ 47,863,205
63
City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
5. LONG -TERM DEBT, Continued
A. Governmental Activities Long -Term Debt, Continued
Certificates of Participation
Certificates of Participation at June 30, 2011, consisted of the following:
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Balance Debt
Debt
Balance
July 1, 2010 Issued
Retired
1995 Certificates of Participation
$ 26,720,000 $ -
$ (26,720,000)
2003 Certificates of Participation
15,275,000 -
(385,000)
Bond Premium
132,758 -
(9,241)
2005 Certificates of Participation
6,260,000 -
(460,000)
Bond Premium
66,338 -
(9,019)
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Total Tax Allocation Bonds $ 48,454,096 $ - $ (27,583,260) $ 20,870,836 $ 880,000 $ 19,990,836
1995 Certi Cates of Participation
In 1995, the Agency issued 1995 Refunding Certificates of Participation in the amount of $31,770,000
consisting of $3,895,000 serial certificates maturing from 1996 to 2009 in semi - annual installments of
$10,000 to $360,000 and term certificates of $6,335,000, $6,405,000, and $15,135,000 maturing in 2016,
2021, and 2029, respectively. The certificates bear interest from 3.65% to 6.15% and are payable semi-
annually on February 1 and August 1. Certificates maturing on or after February 1, 2006 are subject to
optional prepayment in whole or in part on any interest payment date on or after August 1, 2005.
Certificates maturing on August 1, 2015, 2020 and 2028 are subject to mandatory prepayment by lot on
any interest payment date beginning February 1, 2009, 2016, and 2021, respectively. The outstanding
balance of the certificates was paid in full on August 1, 2010.
2003 Certificates of Participation
In January 2003, the City issued 2003 Certificates of Participation in the amount of $17,655,000 for the
construction of a City office building. The 2003 Certificates of Participation consisted of $5,930,000 serial
certificates maturing from 2004 through 2011 in annual installment of $350,000 to $515,000 and term
certificates of $3,005,000, $3,830,000 and $4,890,000 maturing in 2023, 2028 and 2033, respectively.
Interest is payable semi - annually on July 1 and January 1 at rates ranging from 3.00% to 5.00 %.
Certificates maturing on or after January 1, 2018 are subject to optional redemption in whole or in part,
on or after January 1, 2017. Certificates maturing on January 1, 2033 are subject to mandatory
redemption, without premium, on January 1, 2019. At June 30, 2011, the outstanding balance of the 2003
Certificates of Participation was $14,890,000.
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Classification
'
Balance
Due Within
Due In More
June 30, 2011
One Year
Than One Year
14,890,000
400,000
14,490,000
123,517
-
123,517
5,800,000
480,000
5,320,000
'
57,319
-
57,319
Total Tax Allocation Bonds $ 48,454,096 $ - $ (27,583,260) $ 20,870,836 $ 880,000 $ 19,990,836
1995 Certi Cates of Participation
In 1995, the Agency issued 1995 Refunding Certificates of Participation in the amount of $31,770,000
consisting of $3,895,000 serial certificates maturing from 1996 to 2009 in semi - annual installments of
$10,000 to $360,000 and term certificates of $6,335,000, $6,405,000, and $15,135,000 maturing in 2016,
2021, and 2029, respectively. The certificates bear interest from 3.65% to 6.15% and are payable semi-
annually on February 1 and August 1. Certificates maturing on or after February 1, 2006 are subject to
optional prepayment in whole or in part on any interest payment date on or after August 1, 2005.
Certificates maturing on August 1, 2015, 2020 and 2028 are subject to mandatory prepayment by lot on
any interest payment date beginning February 1, 2009, 2016, and 2021, respectively. The outstanding
balance of the certificates was paid in full on August 1, 2010.
2003 Certificates of Participation
In January 2003, the City issued 2003 Certificates of Participation in the amount of $17,655,000 for the
construction of a City office building. The 2003 Certificates of Participation consisted of $5,930,000 serial
certificates maturing from 2004 through 2011 in annual installment of $350,000 to $515,000 and term
certificates of $3,005,000, $3,830,000 and $4,890,000 maturing in 2023, 2028 and 2033, respectively.
Interest is payable semi - annually on July 1 and January 1 at rates ranging from 3.00% to 5.00 %.
Certificates maturing on or after January 1, 2018 are subject to optional redemption in whole or in part,
on or after January 1, 2017. Certificates maturing on January 1, 2033 are subject to mandatory
redemption, without premium, on January 1, 2019. At June 30, 2011, the outstanding balance of the 2003
Certificates of Participation was $14,890,000.
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' City Poway
tY o Y
' Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
' 5. LONG -TERM DEBT, Continued
A. Governmental Activities Long -Term Debt, Continued
Certificate of Participation, Continued
2003 Certificates of Participation, Continued
' The annual requirements to amortize the Certificates of Participation outstanding at June 30, 2011, are as
follows:
Year Ending
June 30, Principal Interest Total
2012 $ 400,000 $ 731,540 $ 1,131,540
' 2013 410,000 716,740 1,126,740
2014 430,000 700,750 1,130,750
2015 445,000 683,550 1,128,550
' 2016 470,000 660,188 1,130,188
2017 -2021 2,725,000 2,923,263 5,648,263
2022 -2026 3,480,000 2,171,500 5,651,500
' 2027 -2031 4,430,000 1,211,500 5,641,500
2032 -2033 2,100,000 158,750 2,258,750
' Total $ 14,890,000 $ 9,957,781 $ 24,847,781
2005 Certiflcates o2articipation
In April 2005, the City issued 2005 Refunding Certificates of Participation in the amount of $8,245,000 to
' refund and defease the City's outstanding 1995 Certificates of Participation and the 1996 Certificates of
Participation. The original 1995 Certificates of Participation were used for several projects such as the
City's pool and Performing Arts Center, while the 1996 Certificates of Participation were used to build
the City's Sheriff Substation. The 2005 Refunding Certificates of Participation consisted of $6,830,000
serial certificates maturing from 2005 through 2020 in annual installments of $305,000 to $610,000 and
term certificates of $1,415,000 maturing in 2026. Interest is payable semi - annually on February 1 and
August 1 at rates ranging from 3.00% to 4.50 %. Certificates maturing on or after August 1, 2016 are
subject to optional redemption in whole or in part, on any date beginning August 1, 2015. Certificates
maturing on August 1, 2026 are subject to mandatory redemptions in part of August 1 of each year
' beginning August 1, 2021. At June 30, 2011, the outstanding balance of the 2005 Certificates of
Participation was $5,800,000.
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City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
5. LONG -TERM DEBT, Continued
A. Governmental Activities Long -Term Debt, Continued
Certificate of Participation, Continued
2005 Certificates of Participation, Continued
The annual requirements to amortize the Certificates of Participation outstanding at June 30, 2011, are as
follows:
Year Ending
June 30, Principal
2012
2013
2014
2015
2016
2017 -2021
2022 -2026
2027 -2031
Total
Notes Payable
$ 480,000
505,000
520,000
540,000
560,000
1,780,000
1,150,000
265,000
Interest
$ 233,538 $
214,531
194,625
171,113
148,800
452,844
193,500
5,963
Total
713,538
719,531
714,625
711,113
708,800
2,232,844
1,343,500
270,963
$ 5,800,000 $ 1,614,914 $ 7,414,914
Notes payable at June 30, 2011, consisted of the following:
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The Agency entered into an Owner Participation Agreement with AZ Poway LLC (dba Mossy Nissan)
that went into effect upon issuance of the certificate of completion for the Mossy Nissan automobile
dealership on July 11, 2003. The Agency purchased an operating covenant for $1,900,000 that accrues
interest at the rate of 7% per annum. Annual payment of the operating covenant is based on 50% of the
net new sales in effect until (i) the purchase price and accrued interested is paid in full, or (ii) the
fifteenth annual payment is made. The operating covenant is deemed paid in full after the fifteenth
annual payment is made, and all remaining balances, including accrued interest, are forgiven. The
balance outstanding at June 30, 2011 was $2,542,008.
.:
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Classification
Balance
Debt
Debt
Balance
'
Due Within Due In More
July 1, 2010
Issued
Retired
June 30, 2011
One Year Than One Year
Mossy Nissan $ 2,400,512
$ 169,930
$ (28,434)
$ 2,542,008
$ - $ 2,542,008 '
Total Notes Payable $ 2,400,512
$ 169,930
$ (28,434)
$ 2,542,008
$ - $ 2,542,008
The Agency entered into an Owner Participation Agreement with AZ Poway LLC (dba Mossy Nissan)
that went into effect upon issuance of the certificate of completion for the Mossy Nissan automobile
dealership on July 11, 2003. The Agency purchased an operating covenant for $1,900,000 that accrues
interest at the rate of 7% per annum. Annual payment of the operating covenant is based on 50% of the
net new sales in effect until (i) the purchase price and accrued interested is paid in full, or (ii) the
fifteenth annual payment is made. The operating covenant is deemed paid in full after the fifteenth
annual payment is made, and all remaining balances, including accrued interest, are forgiven. The
balance outstanding at June 30, 2011 was $2,542,008.
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City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
5. LONG -TERM DEBT, Continued
B. Business -Type Activities Lon&Term Debt
Revenue Bonds
Revenue Bonds at June 30, 2011, consisted of the following:
1995 Revenue Bonds
In November 1995, the Poway Public Financing Authority issued the 1995 Revenue Bonds in the amount
of $3,380,000 to provide funds to construct certain water facility improvements. The bonds consist of
$2,190,000 serial bonds maturing from 1996 to 2010 in annual installments of $105,000 to $200,000 and
$1,190,000 term bonds maturing in 2015.
' Interest is payable semi - annually on May 1 and November 1 with rates ranging from 3.70% to 5.75 %.
Bonds maturing on or after November 1, 2006 are subject to optional redemption prior to maturity, in
whole or in part, on any date on or after November 1, 2005. The term bonds are subject to mandatory
' redemption in part on November 1, 2011 to 2015 in the amounts ranging from $215,000 to $265,000. At
June 30, 2011, the outstanding balance of the 1995 Revenue Bonds was $1,190,000.
' The City has pledged a portion of future water revenue to repay the 1998 Revenue Bonds. Total
principal and interest remaining on the bond is $1,360,502 payable through 2016.
The annual requirements to amortize the bonds outstanding at June 30, 2011 are as follows:
Year Ending
Classification
Balance Debt
Debt
Balance
Due Within
Due In More
July 1, 2010 Issued
Retired
June 30, 2011
One Year
Than One Year
1995 Revenue Bonds $ 1,390,000 $ -
$ (200,000)
$ 1,190,000
$ 215,000
$ 975,000
Bond Discounts (9,429) -
1,823
(7,606)
-
(7,606)
Total Revenue Bonds $ 1,380,571 $ -
$ (198,177)
$ 1,182,394
$ 215,000
$ 967,394
1995 Revenue Bonds
In November 1995, the Poway Public Financing Authority issued the 1995 Revenue Bonds in the amount
of $3,380,000 to provide funds to construct certain water facility improvements. The bonds consist of
$2,190,000 serial bonds maturing from 1996 to 2010 in annual installments of $105,000 to $200,000 and
$1,190,000 term bonds maturing in 2015.
' Interest is payable semi - annually on May 1 and November 1 with rates ranging from 3.70% to 5.75 %.
Bonds maturing on or after November 1, 2006 are subject to optional redemption prior to maturity, in
whole or in part, on any date on or after November 1, 2005. The term bonds are subject to mandatory
' redemption in part on November 1, 2011 to 2015 in the amounts ranging from $215,000 to $265,000. At
June 30, 2011, the outstanding balance of the 1995 Revenue Bonds was $1,190,000.
' The City has pledged a portion of future water revenue to repay the 1998 Revenue Bonds. Total
principal and interest remaining on the bond is $1,360,502 payable through 2016.
The annual requirements to amortize the bonds outstanding at June 30, 2011 are as follows:
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Year Ending
'
June 30,
Principal
Interest
Total
2012
$ 215,000
$ 59,538
$ 274,538
2013
225,000
47,438
272,438
2014
235,000
34,788
269,788
2015
250,000
21,450
271,450
2016
265,000
7,288
272,288
'
Total
$ 1,190,000
$ 170,502
$ 1,360,502
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67
City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
5. LONG -TERM DEBT, Continued
C. Compensated Absences
This liability represents the total unpaid vacation and compensatory time earned by employees of the
City. Since this amount is paid to the employee upon termination of employment, there is no fixed
payment schedule for earned but unpaid compensated absences. The compensated absences are
predominately associated with the General Fund, Water Fund and Sewer Fund. At June 30, 2011, the
outstanding balance of governmental activities and business -type activities compensated absences were
$1,414,248 and $266,330, respectively.
6. ASSESSMENT DISTRICT AND COMMUNITY FACILITIES DISTRICTS BONDS ISSUES
Community Facilities District Special Refunding Bonds
In November 1998, the City issued $26,090,000 in Special Refunding Bonds, Series A and B to refund the
outstanding portion of the $32,800,000 South Poway Community Facilities District No. 1 1987 Special Tax
Refunding Bonds. In April 2004, the City issued $3,775,000 in Special Tax Refunding Bonds to refund the
outstanding portion of the $26,090,000 South Poway Community Facilities District No. 1 1998 Special Tax
Refunding Bonds, Series B. In May 1998, the City issued $35,445,000 in Special Tax Refunding Bonds to
refund the outstanding portion of the $30,000,000 and $8,000,000 Community Facilities District No. 88 -1
(Parkway Business Centre) Special Tax Bonds, Series 1990, respectively. In December 2009 the City issued
$16,545,000 in Special Tax Refunding Bonds to refund the outstanding portion of the $33,445,000
Community Facilities District No. 88 -1 (Parkway Business Centre) Special Tax Refunding Bonds Series 1998.
The bonds are authorized pursuant to the Mello -Roos Community Facilities Act of 1982 and are secured by
and payable from the proceeds of annual special assessment taxes levied and collected on the property
within the District. The Bonds are not general or special obligations of the City. The City is acting as agent
only for the property owners in collecting the special assessments and forwarding the collections to the
fiscal agents. Neither faith and credit nor the taxing power of the City is pledged to the payment of these
bonds. At June 30, 2011, the outstanding balances of the November 1998, April 2004 and December 2009
issuances were $0, $0, and $13,530,000, respectively.
Integrated Financing Assessment District No. 96 -1 Limited Obligation Improvement Bonds
In June 1996, the City issued $586,470 Integrated Financing Assessment District No. 96 -1 (High Valley
Roads) Limited Obligation Improvement Bonds to finance the cost of acquisition and construction of certain
public infrastructure improvement benefiting properties within the boundaries of the assessment district.
The bonds are authorized pursuant to the Improvement Bond Act of 1915 and are secured by and payable
from the proceeds of annual special assessment taxes levied and collected on the property within the
District. The Bonds are not general or special obligations of the City. The City is acting as agent only for the
property owners in collecting the special assessments and forwarding the collections to the fiscal agents.
Neither faith and credit nor the taxing power of the City is pledged to the payment of these bonds. At June
30, 2011, the outstanding balance of the bonds was $255,000.
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City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
6. ASSESSMENT DISTRICT AND COMMUNITY FACILITIES DISTRICTS BONDS ISSUES,
Continued
Old Coach Water Line Assessment District No. 2001 -01 Limited Obligation Improvement Bonds
In July 2001, the City issued $290,350 Old Coach Water Line Assessment District No. 2001 -01 Limited
Obligation Improvement Bonds to finance the cost of acquisition and construction of certain public
infrastructure improvement benefiting properties within the boundaries of the assessment district. The
bonds are authorized pursuant to the Improvement Bond Act of 1915 and are secured by and payable from
the proceeds of annual special assessment taxes levied and collected on the property within the District. The
Bonds are not general or special obligations of the City. The City is acting as agent only for the property
owners in collecting the special assessments and forwarding the collections to the fiscal agents. Neither
faith and credit nor the taxing power of the City is pledged to the payment of these bonds. At June 30, 2011,
the outstanding balance of the bonds was $145,756.
7. RETIREMENT BENEFITS
A. California Public Employees' Retirement Plan (PERS)
' Plan Description
The City contributes to the California Public Employees' Retirement System ( "PERS "), an agent
' multiple- employer public employee defined benefit pension plan. PERS provides retirement and
disability benefits, annual cost -of- living adjustments, and death benefits to plan members and
beneficiaries. PERS acts as a common investment and administrative agent for participating public
' entities within the State of California. Benefit provisions and all other requirements are established by
state statute and city ordinance. Copies of PERS' annual financial report may be obtained from their
Executive Office located at 400 P Street, Sacramento, California 95814.
Funding g` olict�
' Active members are required by State statute to contribute 7% if a Miscellaneous member, and 9% if a
Safety member, of their annual covered salary. The City pays 3% employee contributions for all
Miscellaneous employees and 5% for Safety employees (Fire, Fire Management, and the Fire Chief),
1 which amounted to $574,918 for the year ended June 30, 2011. The City's employer required
contribution rate was 11.416% for Miscellaneous employees and 18.177% for Safety employees for the
fiscal year.
Annual Pension Cost
' For the year ended June 30, 2011, the City's annual pension cost of $2,147,835 for PERS was equal to the
City's required and actual contributions. The required contribution was determined as part of the June
30, 2008, actuarial valuation using the entry age normal actuarial cost method. The actuarial
' assumptions included (a) 7.75% investment rate of return (net of administrative expenses), (b) projected
salary increases range from 3.25 % to 14.45 % for miscellaneous employees and 3.25 % to 14.45 % for safety
employees depending on age, service, and type of employment, and (c) 3.25% per year cost -of- living
' adjustments. Both (a) and (b) included an inflation component of 3 %. The actuarial value of PERS assets
69
City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
7. RETIREMENT BENEFITS, Continued
A. California Public Employees' Retirement Plan (PERS), Continued
Annual Pension Cost, Continued
was determined using techniques that smooth the effects of short -term volatility in the market value of
investments over a three year period. PERS unfunded actuarial accrued liability (or surplus) is being
amortized as a level percentage of projected payroll on a closed basis. The amortization period at June
30, 2008, was 24 years for miscellaneous employees and 18 years for safety employees for prior and
current service unfunded liability.
THREE -YEAR TREND INFORMATION FOR PERS
($ Amounts in Thousands)
Percentage of
Net
Pension
Obligation
Annual Pension Cost (APC)
APC
Fiscal Year
Safety Miscellaneous
Total
Contributed
6/30/2009
$ 1,119 $ 1,488
$ 2,607
100%
6/30/2010
$ 1,097 $ 1,404
$ 2,501
100%
6/30/2011
$ 1,292 $ 855
$ 2,147
100%
Most Recent Actuarial Study - Schedule of Funding
Progress
($ Amounts in Thousands)
Net
Pension
Obligation
Miscellaneous
Employee Group 6/30/2010 $ 62,915 $ 73,762 $ 10,847 85.29% $ 11,972 90.60%
Public Safety The City's safety plan is part of a CalPERS Risk Pool for employers with less than 100 active plan members.
Employee Group As part of a cost sharing multiple - employer defined benefits plan, disclosures of the schedule of funding
progress is not required.
The schedules of funding progress, presented as required supplementary information ( "RSI ") following
the notes to the financial statements, presented multiyear trend information about whether the actuarial
values if plan assets are increasing or decreasing over time relative to the AALs for benefits.
70
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Unfunded
Actuarial
Entry Age
Unfunded
Liability as
Actuarial Actuarial Actuarial
Actuarial
Percentage of
Valuation Asset Accrued
Accrued
Funded Covered Covered
Date Value Liability
Liability
Ratio Payroll Payroll
Miscellaneous
Employee Group 6/30/2010 $ 62,915 $ 73,762 $ 10,847 85.29% $ 11,972 90.60%
Public Safety The City's safety plan is part of a CalPERS Risk Pool for employers with less than 100 active plan members.
Employee Group As part of a cost sharing multiple - employer defined benefits plan, disclosures of the schedule of funding
progress is not required.
The schedules of funding progress, presented as required supplementary information ( "RSI ") following
the notes to the financial statements, presented multiyear trend information about whether the actuarial
values if plan assets are increasing or decreasing over time relative to the AALs for benefits.
70
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City of Poway
' Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
' 7. RETIREMENT BENEFITS, Continued
'
B. Public Agency Retirement Services (PARS)
Plan Description
'
The City sponsors the PARS Retirement Enhancement
Plan. The plan provides a benefit equal to the
2.7% at 55 plan factor, less the Ca1PERS 2% at
55 plan factors for all years of City service and prior
'
Ca1PERS service and reciprocal agency service.
Sample rates are as follows:
Net
Net Net
'
Age Factor Age
Factor Age Factor
50 1.426% 55
2.000% 60 2.262%
51 1.522% 56
2.052% 61 2.314%
'
52 1.628% 57
2.104% 62 2.366%
53 1.742% 58
2.156% 63 2.418%
54 1.866% 59
2.210% 64+ 2.418%
Funding PolicU
' The City's funding policy is to contribute the annual required contribution. The annual required
contribution equals the sum of:
' ➢ Normal cost
➢ Amortization of the unfunded actuarial accrued liability
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Annual Pension Cost
For the year ended June 30, 2011, the City's annual required contribution is $1,085,103. The required
contribution was based on the June 30, 2009 actuarial valuation using the entry age normal actuarial cost
method. The actuarial assumptions included (a) 7.0% investment return (net of administrative
expenses), (b) the CalPERS 1997 - 2007 Experience Study table for Males and Females, (c) projected
annual payroll increases of 3.25% a year plus merit, and (d) cost -of- living adjustment of 2% per year.
Both (a) and (c) included an inflation component of 3.00 %. In addition, the change in the amortization
technique from level percent of pay to level dollar amortization, to comply with GASB requirements
increases the Unfunded Actuarial Liability contribution percentage by approximately 1.31 %, assuming
the initial 20 year closed amortization period, and 1.55% assuming an initial 30 year closed amortization
period.
THREE -YEAR TREND INFORMATION FOR PARS ($ Amounts in Thousands)
($ Amounts in Thousands)
Annual
Pension Cost
Fiscal Year (APC)
6/30/2009 $ 1,083
6/30/2010 $ 1,027
6/30/2011 $ 1,085
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Percentage of
APC Net Pension
Contributed Obligation
100% $
100% $ -
100% $ -
City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
7. RETIREMENT BENEFITS, Continued
B. Public Agency Retirement Services (PARS), Continued
Most Recent Actuarial Study - Schedule of Funding Progress
($ Amounts in Thousands)
Entry Age
Actuarial Actuarial Actuarial
Valuation Asset Accrued
Date Value Liability
Unfunded
Actuarial
Accrued
Liabilitv
Funded
Ratio
Unfunded
Actuarial
Liability as
Percentage of
Covered Covered
Payroll Payroll
1
Miscellaneous
Employee Group 6/30/2011 $ 4,665 $ 12,177 $ 7,512 38.31% $ 10,981 68.41% '
C. Defined Contribution Pension Plan
The City provides pension benefits for all of its part -time employees through a defined contribution
plan. In a defined contribution plan, benefits depend solely on amounts contributed to the plan plus
investment earnings. The plan is administered as part of the Public Agency Retirement System '
( "PARS "). All part -time employees are eligible to participate from the date of employment. Federal
legislation requires contributions of at least 7.5% to a retirement plan, and City Council resolved to
match the employees' contribution of 3.75% for employees hired prior to July 1, 1996. Employees hired '
after July 1, 1996 pay 7.5% of the contributions. The City's contributions for each employee (and interest
earned by the accounts) are fully vested immediately.
For the year ended June 30, 2011, the City's payroll covered by the plan was $603,180. The City made
employer contributions of $499 (0.0828% of current covered payroll), and employees contributed
$44,739 (7.4172% of current covered payroll). '
8. REHABILITATION LOAN PROGRAM '
A. The City Loan Programs
Commercial Revitalization Loans '
The City has two commercial revitalization loans outstanding at June 30, 2011. The original aggregate '
loan amounts were $322,250 and are forgiven at a rate of 20% per year given that all loan covenants are
met. Due to the contingent repayment schedule of these loans, an expenditure is recorded when the loan
is made and no receivable is included in the accompanying basic financial statements. The outstanding '
balance at June 30, 2011 is $64,900.
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City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
8. REHABILITATION LOAN PROGRAM, Continued
B. The City, Redevelopment Agency and Housing Authority Loan Programs
Housing Rehabilitation Loan Program
There are two types of housing rehabilitation loans. Forgivable rehabilitation loans are forgiven at a rate
of 10% per year given all loan covenants are met. Non - forgivable loans are due upon the sale, transfer or
foreclosure of the property. Due to the contingent repayment schedule of these loans, an expenditure is
recorded when the loan is made and no receivable is included in the accompanying basic financial
statements. The balance of the forgivable rehabilitation loans at June 30, 20111 is $146,441, and the
balance of the non - forgivable rehabilitation loans at June 30, 2011 is $94,068.
BEGIN Program Loans
This program is sponsored by a State of California grant to aid first -time buyers purchase affordable
housing in the City of Poway. These loans have a thirty year term with a one percent interest rate. If the
property is transferred or sold within five years the loan must be repaid. After five years, if the property
is transferred or sold the loan must be assumed by the buyer for the remaining term. At the end of the
thirty years the loan must be repaid with principal and interest. Per the grant terms, loan repayments
must be re- loaned. Due to the contingent nature of the repayment schedule of these loans, an
expenditure is recorded when the loan is made and no receivable is included in the accompanying basic
financial statements. The balance of the BEGIN loans, including accrued interest, at June 30, 2011 is
$1,323,323.
Affordable Housing Loans
These loans are made to aid in the purchase of affordable housing in the City of Poway. They are for a
45 year term with no interest and if there is a sale, transfer or foreclosure before the end of the term the
loan must be assumed by an income qualified buyer and the 45 year term starts over. Due to the
contingent nature of the repayment schedule of these loans, an expenditure is recorded when the loan is
made and no receivable is included in the accompanying basic financial statements. The balance of
these Affordable Housing loans at June 30, 2011 is $3,989,224.
Development Loans
The City, through the Housing Authority, has development loans primarily for affordable rental
housing projects and for one group home for the developmentally disabled. The affordable rental
housing loans have 55 year terms with three percent simple interest. Loan payments are made from
residual receipts and generally do not cover the annual accrued interest. Therefore, due to the
contingent nature of the repayment schedule of these loans, an expenditure is recorded when the loan is
made and no receivable is included in the accompanying basic financial statements. The balance of the
development loans, including accrued interest, at June 30, 2011 is $19,028,039.
73
City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
9. TAX INCREMENT REIMBURSEMENT EXPENDITURES
The tax increment reimbursement expenditures are comprised of pass through payments to other taxing
agencies such as the County of San Diego and owner participation agreement payments to developers that
funded public improvements within the project area.
10. OTHER REQUIRED DISCLOSURES
A. Deficit Net Assets/Fund Balance
Government -Wide Financial Statements
At June 30, 2011, the unrestricted net assets had a deficit balance of $(34,679,356) for governmental
activities because long -term debt is in excess of assets owned by the City. The deficit is caused by pass
through payments and other non - capitalizable expenditures from bond proceeds.
Fund Financial Statements
At June 30, 2011, the following fund had a deficit fund balance:
Funds
Non -Major Governmental Funds:
Deficit
800 MHz Communication System $ (4,508)
Storm Water Management (115,940)
800 MHz Communication SyLtem - The non -major government fund 800 MHz system has a deficit fund
balance of $(4,508) as a result of slightly higher than expected expenditures. This fund has had an
annual payment of $87,710 for the last 15 years for its share of county -wide infrastructure and the last
payment was made during fiscal year 2010 -11. Since this payment will not be necessary in fiscal year
2011 -12 there will be sufficient funds available to make up this deficit balance.
Storm Water Mana e ment - The non -major government fund Storm Water Management has a deficit
fund balance of $(115,940) at June 30, 2011, down from a negative $(147,169) at June 30, 2010. The deficit
was expected to be eliminated over the next several years with annual revenues continuing to exceed
annual expenditures. However, as noted in the Contingent Liabilities and Commitments note, the City
of Poway ceased the imposition and collection of the storm water fee during fiscal year 2011 -12.
Therefore, this deficit will be funded by a transfer from the General Fund during fiscal year 2011 -12.
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Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
11. RISK MANAGEMENT
' The City is a member of the California Joint Powers Insurance Authority ( "Authority "). The Authority is
composed of 123 California public entities and is organized under a joint powers agreement pursuant to
California Government Code Section 6500 et. Seq. The purpose of the Authority is to arrange and
' administer programs for the pooling of self - insured losses, to purchase excess insurance or reinsurance, and
to arrange for group - purchased insurance for property and other coverage. The Authority's pool began
covering claims of its members in 1978. Each member government has an elected official as its
' representative on the Board of Directors. The Board operates through a 9- member Executive Committee.
The audited Financial Statements can be obtained from City of Poway. No settlements have exceeded the
City's insurance coverage for each of the past three years.
' A. General Liabilities
' Each member government pays a primary deposit to cover estimated losses for a fiscal year (claim year).
Six months after the close of a fiscal year, outstanding claims are valued. A retrospective deposit
computation is then made for each open claims year. Limit: $50 million combined single limit per
' occurrence.
B. Workers' Compensation
' The City also participates in the workers' compensation pool administered by the Authority. Each
member pays a primary deposit to cover estimated losses for a fiscal year (claims year). Six months
after the close of a fiscal year, outstanding claims are valued. A retrospective deposit computation is
then made for each open claims year. Limit: Statutory benefits and $10 million employers' liability.
' C. Environmental Insurance
The City also participates in the pollution legal liability and remediation legal liability insurance that is
' administered by the Authority. This policy covers sudden and gradual pollution of scheduled property,
streets and storm drains owned by the City. Limit: $10 million per member, $50,000 per occurrence self -
insured retention.
' D. Property Insurance
The City participates in the all-risk property protection program of the Authority. This insurance
protection is underwritten by several insurance companies. The City's property is currently insured
accordingly to a schedule of covered property submitted by the City to the Authority. Total all -risk
' property insurance coverage is $149,643,226. There is a $5,000 per loss deductible except for earthquake
which has a 5% deductible and flood which has a $100,000 per occurrence deductible. Premium for the
coverage are paid annually and are not subject to retroactive adjustments.
E. Fidelity Bonds
' The City purchases blanket fidelity bond coverage in the amount of $1,000,000 with a $2,500 deductible.
The fidelity coverage is provided through the Authority. Premiums are paid annually and are not
subject to retroactive adjustments. At June 30, 2011, no liability was recorded in the accompanying basic
financial statements.
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City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
12. JOINT VENTURE
The City is a member of the Regional Solid Waste Association Joint Powers Authority ( "JPA "). The JPA
was formed on September 1, 1997 by the Cities of Del Mar, Encinitas, National City, Poway, Solana Beach
and Vista to provide stable, long -term, cost effective options for all aspects of regional solid waste disposal.
Each member provides a proportionate percentage of revenue to cover all costs related to the obligations
and liabilities of the JPA when they become due and payable. In the event of dissolution of the JPA, any
money or assets in possession of the Regional Solid Waste Association after the payment of all liabilities,
costs, expenses and charges shall be distributed to the member agencies in proportion to their contributions
determined as of the time of termination. The activities of the JPA are supervised by a board consisting of
one elected member of the legislative body of each of the member agencies. The City of Escondido joined
the JPA as a special contract party for the purpose of working on Regional Household Hazardous Waste
issues. Summarized audited information of the JPA for the fiscal year ended June 30, 2011 is as follows:
Total Assets
$
329,147
Total Liabilitites
$
3,528
Total Equity
$
325,619
Total Revenues
$
266,404
Total Expenses
$
249,778
Net Increase in Fund Equity
$
16,626
City's share of the JPA's assets and liabilities are not available. Separate financial statements of the JPA are
available at the City of Poway.
13. PROPERTY TAXES
Property taxes are levied on March 1 and are payable in two installments: November 1 and February 1 of
each year. Property taxes become delinquent on December 10 and April 10, for the first and second
installments, respectively. The lien date is January 1. The County of San Diego, California (the "County ")
bills and collects property taxes and remits them to the City according to a payment schedule established by
the County.
The County is permitted by State law to levy taxes at 1 % of full market value (at time of purchase) and can
increase the property tax rate no more than 2% per year. The City receives a share of this basic tax levy
proportionate to what it received during the years 1980 -1981.
Property tax revenue is recognized in the fiscal year for which the taxes have been levied, provided the
taxes are received within 60 days after the end of the fiscal year. Property taxes received after this date are
not considered available as a resource that can be used to finance the current year operations of the City
and, therefore, are not recorded as revenue until collected.
No allowance for doubtful accounts was considered necessary.
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City of Poway
t Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
14. CONTINGENT LIABILITIES AND COMMITMENTS
' A. Litigation
The City is a defendant in certain legal actions arising in the normal course of operations. The
' accompanying basic financial statements reflect a liability for the probable amounts of loss associated
with these claims.
B. Grants
The City participates in a number of programs that are fully or partially funded by grants received from
' federal, state, and county governments. Expenditures financed by grants are subject to audit by the
appropriate grantor agency. If expenditures are disallowed due to non - compliance with grant program
regulations, the City may be required to reimburse the grantor agency. As of June 30, 2011, significant
' amounts of grant expenditures have not been audited by the grantor agencies, but the City believes that
disallowed expenditures, if any, based on subsequent audits will not have a material effect on any of the
individual governmental funds or the City's overall financial position.
' C. Construction
' Various construction projects were in progress at June 30, 2011 with an estimated cost to complete of
approximately $25,368,679 in all fund types.
' D. Stormwater Fees
On October 18, 2011 the City of Poway ceased the imposition and collection of the stormwater fee. In
' compliance with Proposition 218, the City mailed approximately 36,000 public hearing notices to water,
sewer and stormwater customers and property owners in 2007, providing a complete explanation of the
proposed stormwater fee. A public hearing was held and 20 written protests were received, which did
' not constitute a majority protest. At that time staff believed the majority protest process under
Proposition 218 was adequate to approve the fee. With the passage of Proposition 26 in November 2010,
combined with subsequent court decisions, it now appears that a majority protest process was not
sufficient, rather, a simple majority of property owners responding to a mail -in ballot would be required
to establish a stormwater fee. Annual revenues from the stormwater fee were approximately $1.3
' million. The cost of the program will now be borne by the General Fund. A claims process has been
established and customers may make claim for the stormwater fees paid in the preceding twelve -month
period, and have approximately one year to do so. An expenditure for the total claims exposure is
' reflected in the June 30, 2011 financial statements.
77
City of Poway
Notes to Basic Financial Statements, Continued '
For the year ended June 30, 2011
15. COMMITMENTS UNDER DEVELOPER AGREEMENTS
On April 1, 1999, the Agency entered into an Owner Participation Agreement with a developer with regard '
to certain parcels of real estate located in the Project Area within the boundaries of Community Facilities
District ( "CFD ") No. 88 -1. In order to provide for the funding of certain public improvements associated
with the project, the Agency will pay the developer on each annual payment date, an amount equal to gross '
property tax increment allocated to and received by the Agency with respect to the site, less the housing set -
aside and the County and City administrative charges for the previous fiscal year ending June 30 preceding
the annual payment date. '
On June 22, 1999, the Agency entered into an Owner Participation Agreement with a developer with regard
to certain parcels of real estate located in the Project Area. In order to provide for the funding of certain '
public improvements associated with the project, the Agency will pay the developer on each annual
payment date, an amount equal to gross property tax increment allocated to and received by the Agency
with respect to the site, less the housing set -aside and the County and City administrative charges for the '
previous fiscal year ending June 30 preceding the annual payment date.
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City of Poway
Notes to Basic Financial Statements, Continued
'
For the year ended June 30, 2011
'
16. FUND BALANCES CLASSIFICATION
'
The City's fund balances at June 30, 2011 are tabulated below by fund types.
Major Funds
Low and
Moderate
Royal
'
Income Housing City of Poway Redevelopment
Housing Mobflehome
Other
General Special Revenue RDA Debt Area Capital
Authority Park
Governmental
Fund Fund Service Fund Projects Fund
Fund Administration
Fund
Total
'
Nonspendable:
Prepaid Items $ 24,366 $ - $ - $ -
$ - $ -
$ -
$ 24,366
Inventories 106,339 - - -
- -
-
106,339
'
Notes Receivable 10,020,403
_
=
10,020,403
= _ _
Total nonspendable 10,151,108
_
10,151,108
'Restricted:
Capital Projects
3,083,408
3,083,408
_ _ _
Debt Service Payments 14,289,645
_ _
4,206,270
18,495,915
Drainage _ _ _ _
- -
4,984,092
4,984,092
'
Fire Protection
Grants
20,742
2,683,175
20,742
2,683,175
Housing - - - -
20,421,109 -
20,421,109
Maintenance Districts - - - -
- -
6,659,102
6,659,102
Parks and Recreation - - - -
- -
1,192,429
1,192,429
Streets - -
-
4,086,243
4,086,243
'
_
ns =
Traportation
=
828,976
828,976
Total restricted - - 14,289,645 -
20,421,109 -
27,744,437
62,455,191
'
Commited:
Economic Stabilization 3,109,132 - - -
- -
-
3,109,132
Street Maintenance 4,496,494 - - -
- -
-
4,496,494
'
Pension Stabilization 2,432,012 - - -
- -
-
2,432,012
Totalcommited 10,037,638 - - -
-
10,037,638
Assigned:
'
Capital Projects 538,699
8,564,840
9,103,539
Contractual Servires 4,104 - - -
- -
-
4,104
Education and Training 208,083 - - -
- -
-
208,083
Equipment 1,759
1,759
'
Library 891,703
891,703
Parks and Recreation 583,556 - - -
- -
-
583,556
Printing 12,137 - - -
- -
-
12,137
'
Public Safety 84,848 - - -
Repair and Maintenance 4,141,830
- -
-
84,848
4,141,830
Total Assigned 6,466,719 - - -
- -
8,564,840
15,031,559
Unassigned:
'
General Fund 23,955,242 - -
- -
-
23,955,242
Special Revenue Funds - - - -
- -
(88,658)
(88,658)
'
Total Unassigned 23,955,242 - - -
- -
(88,658)
(88,658)
Total fund balances $ 50,610,707 $ - $ 13,281,645 $ -
$ 20,421,109 $ -
$ 36,220,619
$ 82,555,279
79
City of Poway
Notes to Basic Financial Statements, Continued '
For the year ended June 30, 2011
17. RELATED PARTY TRANSACTION
In an effort to ensure that the objectives of Poway's Redevelopment Plan and the Poway Redevelopment '
Agency's ( "Agency') 5 -Year Implementation Plan are fulfilled, on March 11, 2011, the Agency transferred
all non - housing assets to the City and all housing related assets to the newly created Poway Housing
Authority (the "Authority ") through an Amended and Restated Cooperation Agreement between the '
Agency and the City and a Cooperation Agreement between the Agency and the Housing Authority.
Under the terms of these agreements, the City and the Housing Authority agreed to respectively carry out
the projects and activities of the Agency in accordance with the objectives and purposes included in the '
Redevelopment and Implementation Plans. Projects included in the Amended and Restated Cooperation
Agreement between the Agency and the City and the Cooperation Agreement between the Agency and the
Housing Authority further the goals of the Redevelopment Plan and will be completed based on available '
tax increment received through 2037.
18. PRIOR PERIOD ADJUSTMENTS I
Government -Wide Financial Statements '
In 2003, the City implemented GASB Statement No. 34, Basic Financial Statements—and Management's
Discussion and Analysis—for State and Local Governments. The objective of this Statement is to make '
annual reports more comprehensive and easier to understand and use by requiring state and local
governments to begin reporting all government -wide financial transactions on an accrual accounting basis.
During the implementation year, the City, in error, recognized the entire lease revenue of Poway Royal '
Mobilehome Park that was expected to be collected but at the time had not been earned. Accordingly, the
City made an adjustment to reduce Net Assets for the unearned revenue as of July 1, 2010.
Governmental
Activities '
Net Assets at July 1, 2010 $ 57,505,982
Lease Revenue (26,720,000) '
Net Assets July 1, 2010, as restated $ 30,785,982
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City of Poway
Notes to Basic Financial Statements, Continued
For the year ended June 30, 2011
18. PRIOR PERIOD ADJUSTMENTS, Continued
Fund Financial Statements
On July 1, 2011, the City implemented GASB Statement No. 54, Fund Balance Reporting and Governmental
Fund Type Definitions. The objective of this Statement is to enhance the usefulness of fund balance
information by providing clearer fund balance classifications that can be more consistently applied and by
clarifying the existing governmental fund type definitions. Accordingly, the City reclassified certain funds
to General Fund.
19. RECENT CHANGES IN LEGISLATION AFFECTING CALIFORNIA REDEVELOPMENT
' AGENCIES
On December 29, 2011, the Supreme Court of the State of California upheld the enforceability of legislation
' that provides for the dissolution of California redevelopment agencies, but struck down the Assembly Bill
X1 27 which would have provided a means for redevelopment agencies to continue to exist and operate by
means of a Voluntary Alternative Redevelopment Program.
' Assembly Bill X1 26 signed into law as part of the State's budget package on June 29, 2011, requires each
California redevelopment agency to suspend nearly all activities except to implement existing contracts,
C
meet already - incurred obligations, preserve its assets, prepare for the impending dissolution of the agency,
and transfer all of its assets to a successor agency that is governed by an oversight board representing the
various taxing jurisdictions in the community.
81
Non -Major
Governmental
'
Funds
General Fund
Fun Balance at July 1, 2010
$ 21,043,908
$ 36,372,446
'
Non -Major Special Revenue Funds:
Better Bendixon
(21,077)
21,077
'
Poway Road Beautification
Poway Valley Senior Center
(10,367)
(442,571)
10,367
442,571
Old Poway Park Tree
(5,995)
5,995
Poway Public Arts Center
(53,566)
53,566
Kumeyaay
(15,514)
15,514
Poway Fine Arts Center
(3,130)
3,130
Senior Volunteer Patrool
(36,703)
36,703
'
Fire Equipment Trust
(8,925)
8,925
Public Art Trust
(29,124)
29,124
Non -Major Permanent Fund:
'
Library
(892,774)
892,774
Fund Balance at July 1, 2010, as Restated
$ 19,524,162
$ 37,892,191
19. RECENT CHANGES IN LEGISLATION AFFECTING CALIFORNIA REDEVELOPMENT
' AGENCIES
On December 29, 2011, the Supreme Court of the State of California upheld the enforceability of legislation
' that provides for the dissolution of California redevelopment agencies, but struck down the Assembly Bill
X1 27 which would have provided a means for redevelopment agencies to continue to exist and operate by
means of a Voluntary Alternative Redevelopment Program.
' Assembly Bill X1 26 signed into law as part of the State's budget package on June 29, 2011, requires each
California redevelopment agency to suspend nearly all activities except to implement existing contracts,
C
meet already - incurred obligations, preserve its assets, prepare for the impending dissolution of the agency,
and transfer all of its assets to a successor agency that is governed by an oversight board representing the
various taxing jurisdictions in the community.
81
City of Poway
Notes to Basic Financial Statements, Continued '
For the year ended June 30, 2011
19. RECENT CHANGES IN LEGISLATION AFFECTING CALIFORNIA REDEVELOPMENT '
AGENCIES, Continued
Assembly Bill X1 26 also required each agency to adopt an Enforceable Obligation Payment Schedule and '
draft a Recognized Obligation Payment Schedule prior to September 30, 2011. Enforceable obligations
include bonds, loans and payments required by the federal or State government; legally enforceable '
payments required in connection with agency employees such as pension payments and unemployment
payments, judgments or settlements; legally binding and enforceable agreements or contracts; and contracts
or agreements necessary for the continued administration or operation of the agency that are permitted for '
purposes set forth in Assembly Bill X1 26. Only the amount of tax revenues necessary to fund the payments
reflected on the Enforceable Obligation Payment Schedule will be allocated to the successor agencies.
Assembly Bill X1 26 directs the State Controller of the State of California to review the propriety of any '
transfers of assets between redevelopment agencies and other public bodies that occurred after January 1,
2011. If the public body that received such transfers is not contractually committed to a third party for the '
expenditure or encumbrance of those assets, the State Controller is required to order the available assets to
be transferred to the public body designated as the successor agency as defined in Assembly Bill X1 26.
The full impacts of this most recent development and its impact on other funds of the City are not known at t
this time. The financial statements do not reflect any adjustments that might result from the outcome of this
uncertainty. '
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i REQUIRED SUPPLEMENTARY
' INFORMATION
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City of Poway
Required Supplementary Information
For the year ended June 30, 2011
1. BUDGETARY INFORMATION I
The City prepares its budgets on the basis of estimated expenditures and, accordingly, the budget amounts '
included in the accompanying financial statements are presented on a basis consistent with generally
accepted accounting principles.
The City Manager submits a proposed budget to the City Council during early May. The City Council '
holds budget hearings during May and early June. The final budget is adopted by the City County during
late June. '
No budget expenditures can be disbursed without proper appropriations. Once the budget is adopted, no '
additional fund appropriations can be authorized without the Council's approval. The level of budget
control (the level on which expenditures may not legally exceed appropriations) is the individual fund
level. The City Manager can authorize budget transfers between departments without additional
appropriations.
The City holds a mid -year budget review meeting. During the meeting, all the budget expenditures are
reviewed and projections for the whole year are made. Therefore, any necessary changes are submitted for
approval by the City Council with a resolution.
Annual appropriated budgets are adopted for the general, special revenue (except for the Performing Arts ,
Center Trust), the permanent funds, and one debt service fund. Budgets are adopted on a basis consistent
with generally accepted accounting principles. Budgeted amounts are as originally adopted and as further
amended by the City Council. Capital improvement projects budgets are adopted upon project approval
and remaining project balances are carried forward to subsequent fiscal years until the project's completion.
Encumbrance accounting is employed in governmental funds. Encumbrances (e.g., purchase orders and ,
contracts) outstanding at year -end are reported as reservations of fund balances and do not constitute
expenditures or liabilities. The commitments will be reappropriated and honored in the subsequent year. I
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City of Poway
Required Supplementary Information, Continued
For the year ended June 30, 2011
1. BUDGETARY INFORMATION, Continued
The following is the budget comparison schedules for the General Fund and all major special revenue
funds.
Budget Comparison Schedule, General Fund
Budgeted Amounts
Actual
Variance with
Original
Final
Amounts
Final Budget
REVENUES:
'
Taxes
$ 22,792,530 $
22,792,530
$ 24,263,657
$ 1,471,127
Licenses and permits
406,610
406,610
457,905
51,295
'
Intergovernmental
320,300
320,300
555,947
235,647
Charges for services
1,002,590
1,002,590
841,629
(160,961)
Fines and forfeitures
655,960
655,%0
678,468
22,508
'
Use of money and property
1,907,600
1,907,600
1,965,035
57,435
Developer fees
3,259,300
3,259,300
3,469,785
210,485
Other revenues
296,300
296,300
499,815
203,515
Total revenues
30,641,190
30,641,190
32,732,241
2,091,051
EXPENDITURES:
Current:
General government
2,395,191
4,958,011
2,680,162
2,277,849
Public safety
19,187,010
19,236,310
18,264,668
971,642
'
Public works
3,687,684
3,408,552
3,133,475
275,077
Development Services
2,546,217
2,728,067
2,388,077
339,990
Community services
4,674,133
4,804,133
4,452,500
351,633
'
Capital outlay
1,170,931
3,456,938
1,937,038
1,519,900
Total expenditures
33,661,166
38,592,011
32,855,920
5,736,091
REVENUES OVER (UNDER) EXPENDITURES
(3,019,976)
(7,950,821)
(123,679)
7,827,142
'
OTHER FINANCING SOURCES (USES):
Transfers in
2,137,340
16,929,436
15,502,350
(1,427,086)
'
Transfers out
Total financing
(2,382,750)
(4,103,810)
(2,660,155)
1,443,655
16,569
12,842,195
12,825,626
(245,410)
other sources (uses)
'
NET CHANGE IN FUND BALANCE
$ (3,265,386) $
4,874,805
12,718,516
$ 7,843,711
FUND BALANCES:
'
Beginning of year, as restated (See Note 18)
37,892,191
End of year
$ 50,610,707
85
City of Poway
Required Supplementary Information, Continued
For the year ended June 30, 2011
1. BUDGETARY INFORMATION, Continued
Budget Comparison Schedule, Low and Moderate Income Housing pecial Revenue Fund
REVENUES:
Taxes
Use of money and property
Other revenues
Total revenues
EXPENDITURES:
Current:
General government
Capital outlay
Total expenditures
REVENUES OVER (UNDER) EXPENDITURES
OTHER FINANCING SOURCES (USES):
Transfers in
Transfers out
Total other financing sources (uses)
NET CHANGE IN FUND BALANCE
FUND BALANCES:
Beginning of year
End of year
Budgeted Amounts
Original
Final
$ 7,790,850 $ 7,806,535 $
391,490 139,124
45,000 40,057
1,215,751
744,650
11,665,993
4,279,023
12,881,744
5,023,673
7,956,438
(4,654,404)
2,962,043
Actual Variance with
Amounts Final Budget
7,803,052 $
(3,483)
28,373
(110,751)
125,013
84,956
7,956,438
(29,278)
727,856 16,794
O,wo,oio ln,iyi
2,949,562 (12,481)
- 4,154,300
4,154,297 (3)
(1,726,390) (24,742,793)
(24,742,785) 8
(1,726,390) (20,588,493)
(20,588,488) 5
(6,380,794) (17,626,450)
(17,638,926) (12,476)
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City of Poway
Required Supplementary Information, Continued
For the year ended June 30, 2011
'
1. BUDGETARY INFORMATION, Continued
'
Budget Comparison Schedule, Housing Authority Special Revenue Fund
'
Budgeted Amounts
Actual
Variance with
Original
Final
Amounts
Final Budget
REVENUES:
'
Use of money and property $ -
$ 252,366
$ 239,985
$ (12,381)
Other revenues -
4,943
7,812
2,869
'
Total revenues -
257,309
247,797
(9,512)
'
EXPENDITURES:
Current:
General government -
590,899
280,539
310,360
Capital outlay -
17,542,894
2,452,744
15,090,150
Debt service:
Interest and fiscal charges -
-
94,125
(94,125)
'
Total expenditures -
18,133,793
2,827,408
15,306,385
REVENUES OVER (UNDER) EXPENDITURES -
(17,876,484)
(2,579,611)
15,296,873
'
OTHER FINANCING SOURCES (USES):
'
Transfers in -
Transfers out
24,144,868
(1,064,690)
24,065,401
(1,064,681)
(79,467)
9
Total other financing sources (uses) -
23,080,178
23,000,720
(79,458)
'
NET CHANGE IN FUND BALANCE $ -
$ 5,203,694
20,421,109
$ 15,217,415
FUND BALANCES:
Beginning of year
'
End of year
$ 20,421,109
87
City of Poway
Required Supplementary Information, Continued
For the year ended June 30, 2011
1. BUDGETARY INFORMATION, Continued
Budget Comparison Schedule, Poway Royal Mobilehome Park Special Revenue Fund
OTHER FINANCING SOURCES (USES):
Proceeds from sale of property - 38,300,000 38,300,000 -
Transfers in - 2,411,150 2,411,150 -
Transfers out - (45,064,011) (44,125,581) 938,430
Total other financing sources (uses) - (4,352,861) (3,414,431) 938,430
NET CHANGE IN FUND BALANCE $ 280,560 $ (4,072,301) (4,235,407) $ (163,106)
FUND BALANCES:
Beginning of year 4,235,407
End of year $ -
88
Budgeted Amounts
Actual
Variance with
Original
Final
Amounts
Final Budget
REVENUES:
Charges for services
$ 4,484,360 $
4,484,360
$ 194,115
$ (4,290,245)
Use of money and property
56,550
56,550
11,029
(45,521)
Other revenues
-
-
284
284
Total revenues
4,540,910
4,540,910
205,428
(4,335,482)
EXPENDITURES:
Current:
Community services
4,260,350
4,260,350
1,026,404
3,233,946
Total expenditures
4,260,350
4,260,350
1,026,404
3,233,946
REVENUES OVER (UNDER) EXPENDITURES
280,560
280,560
(820,976)
(1,101,536)
OTHER FINANCING SOURCES (USES):
Proceeds from sale of property - 38,300,000 38,300,000 -
Transfers in - 2,411,150 2,411,150 -
Transfers out - (45,064,011) (44,125,581) 938,430
Total other financing sources (uses) - (4,352,861) (3,414,431) 938,430
NET CHANGE IN FUND BALANCE $ 280,560 $ (4,072,301) (4,235,407) $ (163,106)
FUND BALANCES:
Beginning of year 4,235,407
End of year $ -
88
City of Poway
Required Supplementary Information, Continued
For the year ended June 30, 2011
2. DEFINED BENEFIT PENSION PLANS
A. California Public Employees' Retirement Plan (PERS)
A schedule of funding progress for the year ended June 30, 2011 including the past three actuarial
valuations is presented below.
Public Safety The City's safety plan becomes part of a Ca1PERS Risk Pool for employers with less than 100 active plan
Employee Group members. As part of a cost sharing multiple - employer defined benefits plan, disclosures of the schedule of
funding progress is not required.
B. Public Agency Retirement Services (PARS)
A schedule of funding progress for the year ended June 30, 2011 including the past three actuarial
valuation is presented below.
($ Amounts in Thousands)
Unfunded
Actuarial
Entry Age
Unfunded
Liability as
Actuarial
Actuarial
Actuarial
Actuarial
Percentage of
Valuation
Asset
Accrued
Accrued Funded
Covered
Covered
Date
Value
Liability
Liability Ratio
Payroll
Payroll
Miscellaneous 6/30/2008
$ 56,126
$ 63,279
$ 7,153 88.70%
$ 12,891
55.49%
Employee Group 6/30/2009
$ 59,494
$ 69,735
$ 10,241 85.31%
$ 12,754
80.30%
6/30/2010
$ 62,915
$ 73,762
$ 10,847 85.29%
$ 11,972
90.60%
Public Safety The City's safety plan becomes part of a Ca1PERS Risk Pool for employers with less than 100 active plan
Employee Group members. As part of a cost sharing multiple - employer defined benefits plan, disclosures of the schedule of
funding progress is not required.
B. Public Agency Retirement Services (PARS)
A schedule of funding progress for the year ended June 30, 2011 including the past three actuarial
valuation is presented below.
89
($ Amounts in Thousands)
Unfunded
Actuarial
Entry Age
Unfunded
Liability as
Actuarial
Actuarial
Actuarial
Actuarial
Percentage of
Valuation
Asset
Accrued
Accrued Funded
Covered
Covered
Date
Value
Liability
Liability Ratio
Payroll
Payroll
Miscellaneous 6/30/2007
$ 1,336
$ 7,799
$ 6,463 17.13%
$ 13,167
49.08%
Employee Group 6/30/2009
$ 2,409
$ 9,755
$ 7,346 24.70%
$ 12,112
60.65%
6/30/2011
$ 4,665
$ 12,177
$ 7,512 38.31%
$ 10,981
68.41%
89
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I SUPPLEMENTARY INFORMATION
u
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91
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92
n
SPECIAL REVENUE FUNDS:
NON -MAJOR
GOVERNMENTAL FUNDS
Fire Protection Fund - Used to account for revenues received from the Fire Protection Special Tax. Voters
' approved this special tax in June 1997. It is used to pay for a portion of the costs of fire protection within the
City of Poway.
' 800 MHz Regional Communication System Fund - Used to account for revenues received from the 800 MHz
Regional Communication System Special Tax. Voters approved this special tax in June 1998. It is used to
' pay for the City's share of the County -wide radio backbone system, and a portion of the annual maintenance
expenses.
' Gas Tax Fund - Used to account for revenues received and expenditures made for street maintenance.
Financing is provided by the City's share of State gasoline taxes made pursuant to the California State
Constitution and authorized by the State Legislature.
' Street Improvement Fund - Used to account for revenues received and expenditures made for street
improvements. Financing is provided primarily from developer's traffic mitigation fees. City Ordinance No.
' 80 authorized the collection and the segregation of the funding.
Drainage Fund - Used to account for operations of the flood control and drainage division. Financing is
' provided by developer's drainage fees and flood zone fees from the County. Poway Municipal Code Section
16.72 requires the segregation of the funding.
' Maintenance Districts Fund - Used for lighting, landscape and maintenance. Costs of the districts are
estimated and property owners are assessed their proportionate share based on an engineer's report. The
assessments are collected via the tax rolls.
Miscellaneous Grants Fund - Used to account for grants from various agencies used for operations and
' maintenance, and to account for specific in -lieu fees from developers. Financing for grants is provided by
the State, County and Federal Government. Such grants provide for payment of all current operating costs
and may be used only for specified purposes.
Community Development Block Grant Fund - Used to account for revenues received and expenditures
made for community development and housing assistance. Financing is provided under agreement with the
' county whereby the City is a secondary recipient with funds made available from the U.S. Department of
Housing and Urban Development under the Housing and Community Development Acts of 1974 and 1977.
' Transportation Development Act Fund - Used to account for revenues received and expenditures made for
transportation development, transit and related studies. Funding is provided to the City as secondary
recipient under agreements with the county and with the San Diego Association of Governments.
93
NON -MAJOR '
GOVERNMENTAL FUNDS
SPECIAL REVENUE FUNDS, Continued: I
Proposition A Fund - To account for the San Diego County special Proposition A one -half (1/2) cent
transportation sales tax which became effective July 1, 1988. All revenues of this fund must be expended for t
certain transportation- related purposes.
Traffic Congestion AB2928 Fund - Used to account for revenues received and expenditures made under the
State's Traffic Congestion Relief grant, AB 2928. These funds must be used for street and highway pavement
maintenance, rehabilitation and reconstruction of necessary associated facilities such as drainage and traffic '
control devices.
Storm Water Management Fund - Used to account for revenues received and expenditures made for the '
City's storm water pollution prevention program.
Regional Arterial Traffic Mitigation - Used to account for new fees required by SANDAG.
Fire Protection Impact Fees - Used to account for revenues received and expenditures made for fire '
protection improvements. Financing is provided primarily from developer fees.
BEGIN Pro g ram - The Building Equity and Growth in Neighborhoods program ( BEGIN ) is funded by the ,
California Department of Housing and Community Development to provide down payment assistance to '
low and moderate income first -time home buyers of newly constructed homes.
PERMANENT FUNDS: I
Mary Patricia Ross Trust Fund - Used to account for revenue and expenses provided by a private estate to
finance community park and recreation purposes. The principal must be maintained intact until 2006. I
Interest income must also be used to finance such recreational purposes.
DEBT SERVICE FUNDS: '
Used to account for accumulation of resources for the payment of interest and principal of long -term debt.
1
CAPITAL PROTECTS FUNDS:
Park Improvement Fund - Used to account for the financing and construction of park facilities throughout '
the City.
Municipal Improvement Fund - Used to account for the financing and construction of the Old Coach '
Waterline. The remaining funds are to be used for the maintenance and operation costs of the waterline.
CIP Fund - Used to account for financing and construction of major capital facilities including infrastructure. '
Major capital projects include construction of governmental buildings, parks, and infrastructure included
streets and roads, and water and sewer. '
94
City of Poway
'Combining Balance Sheet
Non -Major Governmental Funds
June 30, 2011
II
' ASSETS
Cash and investments
Cash and investments with fiscal agents
Receivables:
Taxes
Accounts
Interest
Lease
Due from other governments and agencies
Notes receivable
Advances to other funds
Total assets
' LIABILITIES AND
FUND BALANCES
Liabilities:
Accounts payable
Due to other funds
Deferred revenue
Advances from other funds
Total liabilities
Fund Balances:
Nonspendable
Restricted
Committed
Assigned
Unassigned
Total fund balances
Total liabilities and fund balances
Special Revenue Funds
800 MHz
Fire Communication Gas Street
Protection System Tax Improvement Drainage
$ - $ 7,447 1,514,723 $ 3,446,125 $ 4,980,255
2,157 42 - - 4,203
- 4,635 - -
= 13 = _ =
160,019 - 5,984
- - - - 17,576
$ 2,157 $ 7,502 $ 1,679,377 $ 3,446,125 $ 5,008,018
$ - $ 4,982 $ 175,564 140,548 $ 23,926
7,028 - - -
- - - 723,147 -
12,010 175,564 863,695 23,926
2,157 - 1,503,813 2,582,430 4,984,092
- (4,508) - - -
2,157 (4,508) 1,503,813 2,582,430 4,984,092
$ 2,157 $ 7,502 $ 1,679,377 $ 3,446,125 $ 5,008,018
95
(Continued)
City of Poway
Combining Balance Sheet
Non -Major Governmental Funds, Continued
June 30, 2011
ASSETS
Cash and investments
Cash and investments with fiscal agents
Receivables:
Taxes
Accounts
Interest
Lease
Due from other governments and agencies
Notes receivable
Advances to other funds
Total assets
LIABILITIES AND
FUND BALANCES
Liabilities:
Accounts payable
Due to other funds
Deferred revenue
Advances from other funds
Total liabilities
Fund Balances:
Nonspendable
Restricted
Committed
Assigned
Unassigned
Total fund balances
Total liabilities and fund balances
Special Revenue Funds
Community Transportation
Maintenance Miscellaneous Development Development
Districts Grants Block Grant Act Proposition A
$ 6,745,956 $ 2,700,163 $ 71,441 $ 550,704 $ 27,872
7,349 - - - -
- 48,688 - - -
340 152,562 194,462 - -
$ 6,753,645 $ 2,901,413 $ 265,903 $ 550,704 $ 27,872
$ 94,543 $ 40,924 $ 91,986 $ 1,355 1,080
- 113,260 173,917 - -
64,868 - - -
94,543 219,052 265,903 1,355 1,080
6,659,102 2,682,361 - 549,349 26,792
6,659,102 2,682,361 - 549,349 26,792
$ 6,753,645 $ 2,901,413 $ 265,903 $ 550,704 $ 27,872
(Continued)
96
City of Poway
' Combining Balance Sheet
Non -Major Governmental Funds, Continued
June 30, 2011
n
ASSETS
Cash and investments
Cash and investments with fiscal agents
' Receivables:
Taxes
Accounts
' Interest
Lease
Due from other governments and agencies
Notes receivable
Advances to other funds
Total assets
' LIABILITIES AND
FUND BALANCES
' Liabilities:
Accounts payable
Due to other funds
Deferred revenue
Advances from other funds
Total liabilities
Fund Balances:
Nonspendable
Restricted
Committed
Assigned
Unassigned
' Total fund balances
Total liabilities and fund balances
Special Revenue Funds
Regional
Fire
Traffic Arterial
Protection
Congestion Storm Water Traffic
Impact BEGIN
AB 2928 Management Mitigation
Fees Program
$ - $ - $ 252,835 $ 18,585 $ -
292,359 - - -
374
- - - 315,386
$ - $ 292,733 $ 252,835 $ 18,585 $ 315,386
$ 75,887 $ - $ - $ -
126,781 - - 314,572
206,005 - - -
408,673 - - 314,572
252,835 18,585 814
(115,940) - - -
(115,940) 252,835 18,585 814
$ - $ 292,733 $ 252,835 $ 18,585 $ 315,386
97
(Continued)
City of Poway
Combining Balance Sheet
Non -Major Governmental Funds, Continued
June 30, 2011
Permanent
Funds
Debt Service
Fund
Capital Projects
Funds
Mary
FUND BALANCES
Patricia
Debt Service
Park Municipal CIP
Ross Trust
Fund
Improvement Improvement Fund
ASSETS
Cash and investments $ 89,266 $ 2,850,283 $ 1,411,333 $ 3,768 $ 3,830,087
Cash and investments with fiscal agents - 1,497,310 - - -
Receivables: - -
Taxes - - - - 10,002
Accounts - - - - -
Interest - 927 - - -
Lease - - - -
Due from other governments and agencies - - - - -
Notes receivable - - - - 7,977,928
Advances to other funds - - - - -
Total assets $ 89,266 $ 4,348,520 $ 1,411,333 $ 3,768 $ 11,818,017
LIABILITIES AND
FUND BALANCES
Liabilities:
Accounts payable
$ - $ -
$ 942 $
- $ 141,747
Due to other funds
- -
-
- -
Deferred revenue
- 142,250
-
- -
Advances from other funds
- -
307,228
- -
Total liabilities
- 142,250
308,170
- 141,747
Fund Balances:
Nonspendable
- -
-
- -
Restricted
89,266 4,206,270
1,103,163
3,768 3,079,640
Committed
- -
-
- -
Assigned
- -
-
- 8,564,840
Unassigned
- -
-
- 31,790
Total fund balances
89,266 4,206,270
1,103,163
3,768 11,676,270
Total liabilities and fund balances
$ 89,266 $ 4,348,520
$ 1,411,333 $
3,768 $ 11,818,017
(Continued)
98
II
City of Poway
' Combining Balance Sheet
Non -Major Governmental Funds, Continued
' June 30, 2011
I I
n
' ASSETS
Cash and investments
Cash and investments with fiscal agents
' Receivables:
Taxes
Accounts
' Interest
Lease
Due from other governments and agencies
' Notes receivable
Advances to other funds
Total assets
LIABILITIES AND
FUND BALANCES
Liabilities:
Accounts payable
Due to other funds
' Deferred revenue
Advances from other funds
Total liabilities
Fund Balances:
Nonspendable
Restricted
' Committed
Assigned
Unassigned
Total fund balances
Total liabilities and fund balances
I I
II
II
II
Total
Other
Governmental
$ 28,500,843
1,497,310
23,753
345,682
940
374
828,753
7,977,928
17,576
$ 39,193,159
$ 793,484
735,558
207,118
1,236,380
27,744,437
8,564,840
(88,658)
36,220,619
$ 39,193,159
(Concluded)
99
City of Poway
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
Non -Major Governmental Funds
For the year ended June 30, 2011
REVENUES:
Taxes
Intergovernmental
Charges for services
Development fees
Assessment levied
Use of money and property
Other revenues
Total revenues
EXPENDITURES:
Current:
General government
Public safety
Public works
Community services
Capital outlay
Debt service:
Principal
Interest and fiscal charges
Total expenditures
REVENUES OVER
(UNDER) EXPENDITURES
OTHER FINANCING SOURCES (USES):
Transfers in
Transfers out
Total other financing sources (uses)
REVENUES AND OTHER
FINANCING SOURCES OVER
(UNDER) EXPENDITURES AND
OTHER FINANCING USES
FUND BALANCES:
Beginning of year
End of year
Special Revenue Funds
63,619 - - -
- 963,585 140,548 573,724
125,144
83,020 -
4,691 - - -
151,330 963,585 140,548 698,868
616,467 (16,197) 376,996 1,237,056 2,368,477
(617,385) - - - -
(617,385) - - -
(918) (16,197) 376,996 1,237,056 2,368,477
3,075 11,689 1,126,817 1,345,374 2,615,615
$ 2,157 $ (4,508) $ 1,503,813 $ 2,582,430 $ 4,984,092
(Continued)
100
800 MHz
Fire
Communication
Gas
Street
Protection
System
Tax
Improvement
Drainage
$ -
$ - $
1,305,554
$ -
$ 682,612
-
-
2,902
-
5,984
616,467
135,133
15
-
-
-
-
-
204,914
11,011
-
-
6,523
1,172,690
2,367,678
-
-
25,587
-
60
616,467
135,133
1,340,581
1,377,604
3,067,345
63,619 - - -
- 963,585 140,548 573,724
125,144
83,020 -
4,691 - - -
151,330 963,585 140,548 698,868
616,467 (16,197) 376,996 1,237,056 2,368,477
(617,385) - - - -
(617,385) - - -
(918) (16,197) 376,996 1,237,056 2,368,477
3,075 11,689 1,126,817 1,345,374 2,615,615
$ 2,157 $ (4,508) $ 1,503,813 $ 2,582,430 $ 4,984,092
(Continued)
100
City of Poway
'
Combining Statement of Revenues, Expenditures and Changes in
Fund Balances
Non -Major Governmental Funds, Continued
For the year ended June 30, 2011
'
'
Special Revenue Funds
Community Transportation
'
Maintenance
Miscellaneous
Development Development
Districts
Grants
Block Grant
Act
Proposition A
'REVENUES:
Taxes $
284,208
$ -
$ - $
-
$ 1,072,514
Intergovernmental
2,628
586,030
267,412
5,000
-
Charges for services
18
-
_
_
_
'
Development fees
362,728
Assessment levied
1,902,409
-
-
-
-
of money and property
64,340
28,466
=
5,533
=
'Use
Other revenues
12,243
54,904
Total revenues
2,265,846
1,032,128
267,412
10,533
1,072,514
'
EXPENDITURES:
Current:
General government
'
Public safety
=
=
_
_
_
Public works
2,081,378
1,134,999
Community services
-
-
-
-
-
'Capital
outlay
-
453,239
267,412
49,471
83,240
Debt service:
Principal
-
-
-
-
-
Interest and fiscal charges
-
-
-
-
-
'
Total expenditures
2,081,378
453,239
267,412
49,471
1,218,239
'
REVENUES OVER
(UNDER) EXPENDITURES
184,468
578,889
(38,938)
(145,725)
OTHER FINANCING SOURCES (USES):
Transfers in
305,821
Transfers out
-
(100,000)
-
-
-
'
Total other financing sources (uses)
305,821
(100,000)
-
-
-
REVENUES AND OTHER
FINANCING SOURCES OVER
'
(UNDER) EXPENDITURES AND
OTHER FINANCING USES
490,289
478,889
(38,938)
(145,725)
'FUND
BALANCES:
Beginning of year
6,168,813
2,203,472
-
588,287
172,517
End of year $
6,659,102
$ 2,682,361
$ - $
549,349
$ 26,792
'
(Continued)
'
101
City of Poway
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
Non -Major Governmental Funds, Continued
For the year ended June 30, 2011
REVENUES:
Taxes
Intergovernmental
Charges for services
Development fees
Assessment levied
Use of money and property
Other revenues
Total revenues
EXPENDITURES:
Current:
General government
Public safety
Public works
Community services
Capital outlay
Debt service:
Principal
Interest and fiscal charges
Total expenditures
REVENUES OVER
(UNDER) EXPENDITURES
OTHER FINANCING SOURCES (USES):
Transfers in
Transfers out
Total other financing sources (uses)
REVENUES AND OTHER
FINANCING SOURCES OVER
(UNDER) EXPENDITURES AND
OTHER FINANCING USES
FUND BALANCES:
Beginning of year
End of year
Special Revenue Funds
472,211 1,490,448 - -
374,242
472,211 1,490,448 - - 374,242
(468,483) (162,621) 161,047 14,852 -
193,850 - -
193,850 - -
(468,483) 31,229 161,047 14,852 -
468,483 (147,169) 91,788 3,733 814
$ - $ (115,940) $ 252,835 $ 18,585 $ 814
(Continued)
102
Regional
Fire
Traffic
Arterial
Protection
Congestion
Storm Water
Traffic
Impact
BEGIN
AB 2928
Management
Mitigation
Fees
Program
-
-
-
-
374,242
-
1,327,827
-
-
-
-
-
158,156
14,653
-
3,728
-
2,891
199
-
3,728
1,327,827
161,047
14,852
374,242
472,211 1,490,448 - -
374,242
472,211 1,490,448 - - 374,242
(468,483) (162,621) 161,047 14,852 -
193,850 - -
193,850 - -
(468,483) 31,229 161,047 14,852 -
468,483 (147,169) 91,788 3,733 814
$ - $ (115,940) $ 252,835 $ 18,585 $ 814
(Continued)
102
'REVENUES:
Taxes $ - $ - $ - $ - $
Intergovernmental - - - -
' Charges for services
Development fees 294,996
Assessment levied - - - - -
'Use of money and property 913 854,193 15,400 39 438,326
Other revenues
Total revenues 913 854,193 310,396 39 438,326
'
EXPENDITURES:
1
Current:
City of Poway
General government
'
Combining Statement of Revenues, Expenditures
and
Changes in Fund Balances
Non -Major Governmental Funds, Continued
Public works
-
For the year ended June 30, 2011
- -
-
'
outlay
- -
67,849
Debt service:
Principal
Permanent
Debt Service
Capital Project
Interest and fiscal charges
- 1,004,317
Funds
Fund
Fund
Total expenditures
1,849,317
67,849
'
Mary
913 (995,124)
242,547
'
Patricia
Debt Service
Park Municipal CIP
OTHER FINANCING SOURCES (USES):
Ross Trust
Fund
Improvement Improvement Fund
'REVENUES:
Taxes $ - $ - $ - $ - $
Intergovernmental - - - -
' Charges for services
Development fees 294,996
Assessment levied - - - - -
'Use of money and property 913 854,193 15,400 39 438,326
Other revenues
Total revenues 913 854,193 310,396 39 438,326
'
EXPENDITURES:
1
Current:
General government
- -
'
Public safety
Public works
-
Community services
- -
-
'Capital
outlay
- -
67,849
Debt service:
Principal
- 845,000
-
Interest and fiscal charges
- 1,004,317
-
'
Total expenditures
1,849,317
67,849
'
REVENUES OVER
(UNDER) EXPENDITURES
913 (995,124)
242,547
OTHER FINANCING SOURCES (USES):
'
Transfers in
- 1,726,938
-
Transfers out
- (443,700)
-
'
Total other financing sources (uses)
- 1,283,238
-
REVENUES AND OTHER
FINANCING SOURCES OVER
'
(UNDER) EXPENDITURES AND
OTHER FINANCING USES
913 288,114
242,547
'
FUND BALANCES:
872,910
641,855
1,514,765
39 (1,076,439)
12,752,709
12,752,709
39 11,676,270
Beginning of year 88,353 3,918,156 860,616 3,729 -
End of year $ 89,266 $ 4,206,270 $ 1,103,163 $ 3,768 $ 11,676,270
' (Continued)
1
103
City of Poway
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
Non -Major Governmental Funds, Continued
For the year ended June 30, 2011
EXPENDITURES:
Total
Current:
Other
General government
Governmental
Public safety
Funds
REVENUES:
6,856,893
Taxes
$ 3,344,888
Intergovernmental
1,244,198
Charges for services
2,079,460
Development fees
1,046,458
Assessment levied
1,902,409
Use of money and property
4,960,919
Other revenues
92,794
Total revenues
14,671,126
EXPENDITURES:
Current:
General government
872,910
Public safety
63,619
Public works
6,856,893
Community services
-
Capital outlay
2,062,452
Debt service:
Principal
928,020
Interest and fiscal charges
1,009,008
Total expenditures
11,792,902
REVENUES OVER
(UNDER) EXPENDITURES
2,878,224
OTHER FINANCING SOURCES (USES):
Transfers in
14,979,318
Transfers out
(1,161,085)
Total other financing sources (uses)
13,818,233
REVENUES AND OTHER
2,226,609
FINANCING SOURCES OVER
(UNDER) EXPENDITURES AND
OTHER FINANCING USES
16,696,457
FUND BALANCES:
Beginning of year 19,524,162
End of year $ 36,220,619
(Concluded)
WE,!
City of Poway
'Schedule
of Revenues, Expenditures and Changes in Fund Balances -
Budget and Actual
City of Poway RDA Debt Service Fund
'
For the year ended June 30, 2011
Budgeted Amount
Variance with
Fund balance, July 1, 2010
Original
Final
Actual
Final Budget
$ 13,938,600
$ 13,938,600
$ 13,938,600
$ -
Resources (inflows):
Tax increment
38,954,230
38,954,230
31,212,209
(7,742,021)
Use of money and property
733,330
683,502
616,391
(67,111)
Lease revenue
Proceeds from loans
2,402,920
169,760
2,402,920
169,760
-
169,930
(2,402,920)
170
Transfers in
1,726,390
37,062,173
37,077,848
15,675
'
Amount available for appropriation
43,986,630
79,272,585
69,076,378
(10,196,207)
Charges to appropriation (outflows):
'
Debt service:
Principal
6,600,000
33,320,000
32,495,000
825,000
Interest and fiscal charges
15,048,100
19,634,943
16,868,986
2,765,957
'
Tax increment reimbursement
6,517,390
6,517,390
5,948,554
568,836
Tax shift
2,818,050
2,818,050
2,820,770
(2,720)
Transfers out
12,430,330
27,543,069
10,592,023
(16,951,046)
Total charges to appropriations
43,413,870
89,833,452
68,725,333
(12,793,973)
tExcess
of resources over (under)
charges to appropriations
572,760
(10,560,867)
351,045
(22,990,180)
'
Fund balance, June 30, 2011
$ 14,511,360
$ 3,377,733
$ 14,289,645
$ (22,990,180)
i
1
105
City of Poway
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Fire Protection Special Revenue Fund
For the year ended June 30, 2011
'
Budgeted Amounts
Original Final
Actual
Amounts
Variance with
Final Budget
'
Fund balance, July 1, 2010 $
3,075 $
3,075
$ 3,075
$
Resources (inflows):
Charges for services
600,000
600,000
616,467
16,467
Amount available for appropriation
600,000
600,000
616,467
16,467
Charges to appropriations (outflows):
Transfers out
600,000
617,390
617,385
5
Total charges to appropriations
600,000
617,390
617,385
5
'
Excess of resources over (under)
charges to appropriations
-
(17,390)
(918)
16,472
'
Fund balance, June 30, 2011 $
3,075 $
(14,315)
$ 2,157
$ 16,472
106
'Schedule
City of Poway
of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
800 MHz Communication System Special Revenue Fund
For the year ended June 30, 2011
Budgeted Amounts
Actual
Variance with
'
Original Final
Amounts
Final Budget
Fund balance, July 1, 2010
$ 11,689 $
11,689
$ 11,689
$ -
Resources (inflows):
Charges for services
134,000
134,000
135,133
1,133
'
Use of money and property
500
500
(500)
Amount available for appropriation
134,500
134,500
135,133
633
'
Charges to appropriations (outflows):
Public safety
68,000
68,000
63,619
4,381
'
Debt service:
Principal
83,020
83,020
83,020
-
'
Interest and fiscal charges
Total to
4,700
155,720
4,700
155,720
4,691
151,330
9
4,390
charges appropriations
'
Excess of resources over (under)
charges to appropriations
(21,220)
(21,220)
(16,197)
5,023
Fund balance, June 30, 2011
$ (9,531) $
(9,531)
$ (4,508)
$ 5,023
'
107
City of Poway
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Gas Tax Special Revenue Fund
For the year ended June 30, 2011
108
Budgeted Amounts
Actual
Variance with
Original
Final
Amounts
Final Budget
Fund balance, July 1, 2010
$ 1,126,817 $
1,126,817
$ 1,126,817
$ -
Resources (inflows):
Taxes
1,324,260
1,324,260
1,305,554
(18,706)
Intergovernmental
-
-
2,902
2,902
Charges for services
-
-
15
15
Use of money and property
7,610
7,610
6,523
(1,087)
Other revenue
-
-
25,587
25,587
Amount available for appropriation
1,331,870
1,331,870
1,340,581
27,417
Charges to appropriations (outflows):
Public works
1,687,703
1,509,077
963,585
545,492
Total charges to appropriations
1,687,703
1,509,077
963,585
545,492
Excess of resources over (under)
charges to appropriations
(355,833)
(177,207)
376,996
572,909
Fund balance, June 30, 2011
$ 770,984 $
949,610
$ 1,503,813
$ 572,909
108
'
'
City of Poway
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Street Improvement Special Revenue Fund
For the year ended June 30, 2011
Budgeted Amounts
Actual
Variance with
'
Original
Final
Amounts
Final Budget
'
Fund balance, July 1, 2010 $
1,345,374 $
1,345,374
$ 1,345,374
$ -
Resources (inflows):
Developers fee
86,610
86,610
204,914
118,304
'
Use of money and property
5,220
2,793,129
1,172,690
(1,620,439)
Amount available for appropriation
91,830
2,879,739
1,377,604
(1,502,135)
'
Charges to appropriations (outflows):
Public works
101,900
781,900
140,548
641,352
'
Total charges to appropriations
101,900
781,900
140,548
641,352
Excess of resources over (under)
'
charges to appropriations
(10,070)
2,097,839
1,237,056
(860,783)
'
Fund balance, June 30, 2011 $
1,335,304 $
3,443,213
$ 2,582,430
$ (860,783)
1
t
'
109
City of Poway
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Drainage Special Revenue Fund
For the year ended June 30, 2011
'
Budgeted Amounts
Actual
Variance with
Original
Final
Amounts
Final Budget
'
Fund balance, July 1, 2010
$ 2,615,615 $
2,615,615
$ 2,615,615
$ -
Resources (inflows):
Taxes
655,270
655,270
682,612
27,342
Intergovernmental
-
-
5,984
5,984
'
Developer fees
-
-
11,011
11,011
Use of money and property
19,570
3,379,371
2,367,678
(1,011,693)
Other revenue
-
-
60
60
'
Amount available for appropriation
674,840
4,034,641
3,067,345
(967,296)
'
Charges to appropriations (outflows):
Public works
631,568
636,958
573,724
63,234
Capital outlay
469,859
994,859
125,144
869,715
'
Total charges to appropriations
1,101,427
1,631,817
698,868
932,949
Excess
'
of resources over (under)
charges to appropriations
(426,587)
2,402,824
2,368,477
(34,347)
Fund balance, 30, 2011
June
$ 2,189,028 $
5,018,439
$ 4,984,092
$ (34,347)
'
110
'
'
City of Poway
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Maintenance Districts Special Revenue Fund
For the year ended June 30, 2011
1
Budgeted
Amounts
Actual
Variance with
'
Original
Final
Amounts
Final Budget
Fund balance, July 1, 2010
$ 6,168,813
$ 6,168,813
$ 6,168,813
$ -
'
Resources (inflows):
Taxes
304,920
304,920
284,208
(20,712)
'
Intergovernmental
2,628
2,628
Charges for services
-
-
18
18
Assessment levied
1,883,990
1,883,990
1,902,409
18,419
'
Use of money and property
106,830
106,830
64,340
(42,490)
Other revenue
-
-
12,243
12,243
'
Transfers in
321,150
321,150
305,821
(15,329)
Amount available for appropriation
2,616,890
2,616,890
2,571,667
(45,223)
'
Charges to appropriations (outflows):
Public works
2,297,831
2,356,235
2,081,378
274,857
'
Total charges to appropriations
2,297,831
2,356,235
2,081,378
274,857
Excess of resources over (under)
'
charges to appropriations
319,059
260,655
490,289
229,634
Fund balance, June 30, 2011
$ 6,487,872
$ 6,429,468
$ 6,659,102
$ 229,634
1
1
'
111
City of Poway
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Miscellaneous Grant Special Revenue Fund
For the year ended June 30, 2011
112
Budgeted Amounts
Actual
Variance with
Original
Final
Amounts
Final Budget
Fund balance, July 1, 2010
$ 2,203,472 $
2,203,472
$ 2,203,472
$ -
Resources (inflows):
Intergovernmental
434,264
434,264
586,030
151,766
Developer fees
39,200
39,200
362,728
323,528
Use of money and property
40,680
40,680
28,466
(12,214)
Other revenue
-
-
54,904
54,904
Amount available for appropriation
514,144
514,144
1,032,128
517,984
Charges to appropriations (outflows):
Capital outlay
1,464,569
1,256,297
453,239
803,058
Transfers out
100,000
100,000
100,000
-
Total charges to appropriations
1,564,569
1,356,297
553,239
803,058
Excess of resources over (under)
charges to appropriations
(1,050,425)
(842,153)
478,889
1,321,042
Fund balance, June 30, 2011
$ 1,153,047 $
1,361,319
$ 2,682,361
$ 1,321,042
112
City of Poway
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Community Development Block Grant Special Revenue Fund
For the year ended June 30, 2011
Budgeted Amounts
Actual
Variance with
Original Final
Amounts
Final Budget
'
Fund balance, July 1, 2010
$ - $ -
$ -
$ -
Resources (inflows):
'
Intergovernmental
208,760 208,760
267,412
58,652
Amount available for appropriation
208,760 208,760
267,412
58,652
'
Charges to appropriations (outflows):
Capital outlay
454,679 393,303
267,412
125,891
Total charges to appropriations
454,679 393,303
267,412
125,891
Excess of resources over (under)
'
charges to appropriations
(245,919) (184,543)
-
184,543
Fund balance, June 30, 2011
$ (245,919) $ (184,543)
$ -
$ 184,543
113
City of Poway
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Transportation Development Act Special Revenue Fund
For the year ended June 30, 2011
114
Budgeted Amounts
Actual
Variance with
Original Final
Amounts
Final Budget
Fund balance, July 1, 2010
$ 588,287 $
588,287
$ 588,287
$ -
Resources (inflows):
Intergovernmental
5,000
5,000
5,000
Use of money and property
11,960
11,960
5,533
(6,427)
Amount available for appropriation
16,960
16,960
10,533
(6,427)
Charges to appropriations (outflows):
Capital outlay
395,866
395,866
49,471
346,395
Total charges to appropriations
395,866
395,866
49,471
346,395
Excess of resources over (under)
charges to appropriations
(378,906)
(378,906)
(38,938)
339,968
Fund balance, June 30, 2011
$ 209,381 $
209,381
$ 549,349
$ 339,968
114
'
City of Poway
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Proposition A Special Revenue Fund
For the year ended June 30, 2011
Budgeted Amounts
Actual
Variance with
Original
Final
Amounts
Final Budget
Fund balance, July 1, 2010 $
172,517 $
172,517
$ 172,517
$ -
Resources (inflows):
Taxes
1,139,270
1,139,270
1,072,514
(66,756)
Use of money and property
5,440
5,440
(5,440)
Other revenue
-
-
-
-
'
Amount available for appropriation
1,144,710
1,144,710
1,072,514
(72,196)
Charges to appropriations (outflows):
'
Public works
1,144,710
1,144,710
1,134,999
9,711
Capital outlay
100,000
100,000
83,240
16,760
'
Total charges to appropriations
1,244,710
1,244,710
1,218,239
26,471
Excess of resources over (under)
'
charges to appropriations
(100,000)
(100,000)
(145,725)
(45,725)
Fund balance, June 30, 2011 $
72,517 $
72,517
$ 26,792
$ (45,725)
'
115
City of Poway
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Traffic Congestion AB 2928 Special Revenue Fund
For the year ended June 30, 2011
116
Budgeted Amounts
Actual
Variance with
Original Final
Amounts
Final Budget
Fund balance, July 1, 2010
$ 468,483 $
468,483
$ 468,483
$ -
Resources (inflows):
Use of money and property
1,630
1,630
3,728
2,098
Amount available for appropriation
1,630
1,630
3,728
2,098
Charges to appropriations (outflows):
Public works
5,000
472,220
472,211
9
Total charges to appropriations
5,000
472,220
472,211
9
Excess of resources over (under)
charges to appropriations
(3,370)
(470,590)
(468,483)
2,107
Fund balance, June 30, 2011
$ 465,113 $
(2,107)
$ -
$ 2,107
116
'
'
City of Poway
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Storm Water Management Special Revenue Fund
For the year ended June 30, 2011
Budgeted Amounts
Actual
Variance with
Original
Final
Amounts
Final Budget
Fund balance, July 1, 2010
$ (147,169) $
(147,169)
$ (147,169)
$ -
Resources (inflows):
Charges for services
1,430,300
1,430,300
1,327,827
(102,473)
'
Transfers in
193,850
193,850
193,850
Amount available for appropriation
1,624,150
1,624,150
1,521,677
(102,473)
'
Charges to appropriations (outflows):
Public works
1,613,253
1,621,173
1,490,448
130,725
Total charges to appropriations
1,613,253
1,621,173
1,490,448
130,725
Excess of resources over (under)
'
charges to appropriations
10,897
2,977
31,229
28,252
Fund balance, June 30, 2011
$ (136,272) $
(144,192)
$ (115,940)
$ 28,252
'
117
City of Poway
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Regional Arterial Traffic Mitigation Special Revenue Fund
For the year ended June 30, 2011
Fund balance, July 1, 2010
Resources (inflows):
Developers fee
Use of money and property
Amount available for appropriation
Excess of resources over (under)
charges to appropriations
Fund balance, June 30, 2011
Budgeted Amounts
Actual
Variance with
Original Final
Amounts
Final Budget
$ 91,788 $
91,788
$ 91,788
$ -
24,980
24,980
158,156
133,176
1,960
1,960
2,891
931
26,940
26,940
161,047
134,107
26,940
26,940
161,047
134,107
$ 118,728 $
118,728
$ 252,835
$ 134,107
118
City of Poway
' Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Fire Protection Impact Fees
For the year ended June 30, 2011
Budgeted Amounts
Actual
Variance with
t
Original Final
Amounts
Final Budget
Fund balance, July 1, 2010
$ 3,733 $
3,733
$ 3,733
$ -
Resources (inflows):
Development fees
3,870
3,870
14,653
10,783
'
Use of money and property
199
199
Amount available for appropriation
3,870
3,870
14,852
10,982
'
Excess of resources over (under)
charges to appropriations
3,870
3,870
14,852
10,982
'
Fund balance, June 30, 2011
$ 7,603 $
7,603
$ 18,585
$ 10,982
'
119
City of Poway
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
BEGIN Program
For the year ended June 30, 2011
'
Budgeted Amounts
Actual
Variance with
'
Original Final
Amounts
Final Budget
Fund balance, 1, 2010
July
$ 814 $ 814
$ 814
$ -
Resources (inflows):
'
Intergovernmental
- -
374,242
374,242
Amount available for appropriation
- -
374,242
374,242
,
Charges to appropriations (outflows):
Capital outlay
610,598 610,598
374,242
236,356
'
Total charges to appropriations
610,598 610,598
374,242
236,356
t
Excess of resources over (under)
charges to appropriations
(610,598) (610,598)
-
137,886
'
Fund balance, June 30, 2011
$ (1,545,000) $ (1,545,000)
$ 814
$ 814
'
120
City of Poway
' Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Mary Patricia Ross Trust Permanent Fund
For the year ended June 30, 2011
Budgeted Amounts Actual Variance with
' Original Final Amounts Final Budget
' Fund balance, July 1, 2010 $ 88,353 $ 88,353 $ 88,353 $
Resources (inflows):
' Use of money and property 920 920 913
Amount available for appropriation 920 920 913 (7)
' Excess of resources over (under)
charges to appropriations 920 920 913 (7)
Fund balance, June 30, 2011 $ 89,273 $ 89,273 $ 89,266 $ (7)
' 121
(7)
City of Poway
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
City Debt Service Fund
For the year ended June 30, 2011
122
Budgeted Amounts
Actual
Variance with
Original
Final
Amounts
Final Budget
Fund balance, July 1, 2010
$ 3,918,156
$ 3,918,156
$ 3,918,156
$ -
Resources (inflows):
Use of money and property
799,700
849,528
854,193
4,665
Transfers in
662,170
1,728,870
1,726,938
(1,932)
Amount available for appropriation
1,461,870
2,578,398
2,581,131
2,733
Charges to appropriations (outflows):
Debt service:
Principal
845,000
845,000
845,000
-
Interest and fiscal charges
1,013,130
1,013,130
1,004,317
8,813
Transfers out
-
443,700
443,700
-
Total charges to appropriations
1,858,130
2,301,830
2,293,017
8,813
Excess of resources over (under)
charges to appropriations
(396,260)
276,568
288,114
11,546
Fund balance, June 30, 2011
$ 3,521,896
$ 4,194,724
$ 4,206,270
$ 11,546
122
'
'
City of Poway
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Park Improvement Capital Project Fund
For the year ended June 30, 2011
Budgeted Amounts
Actual
Variance with
'
Original Final
Amounts
Final Budget
Fund balance, July 1, 2010 $
860,616 $
860,616
$ 860,616
$ -
Resources (inflows):
Development fees
54,740
54,740
294,996
240,256
'
Use of money and property
21,750
21,750
15,400
(6,350)
Amount available for appropriation
76,490
76,490
310,396
(6,350)
'
Charges to appropriations (outflows):
Capital outlay
-
700,000
67,849
632,151
'
Total charges to appropriations
-
700,000
67,849
632,151
Excess of resources over (under)
'
charges to appropriations
76,490
(623,510)
242,547
625,801
'
Fund balance, June 30, 2011 $
937,106 $
237,106
$ 1,103,163
$ 625,801
'
123
City of Poway
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
Municipal Improvement Capital Project Fund
For the year ended June 30, 2011
'
Budgeted Amounts
Actual
Variance with
Original Final
Amounts
Final Budget
'
Fund balance, July 1, 2010 $ 3,729 $
3,729
$ 3,729
$ -
Resources (inflows):
Use of money and property 80
80
39
(41)
'
Amount available for appropriation 80
80
39
(41)
Excess of resources over (under)
'
charges to appropriations 80
80
39
(41)
Fund balance, June 30, 2011 $ 3,809 $
3,809
$ 3,768
$ (41)
'
1
'
124
'
'
City f Poway
Y
Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual
CIP Fund
For the year ended June 30, 2011
Budgeted Amounts
Actual
Variance with
'
Original Final
Amounts
Final Budget
Fund balance, July 1, 2010
$ - $ -
$ -
$ -
Resources (inflows):
Use of money and property
= 557,652
438,326
(119,326)
'
Transfers in
12,688,741
12,752,709
63,968
Amount available for appropriation
- 13,246,393
13,191,035
(55,358)
'
Charges to appropriations (outflows):
General government
- 1,632,316
872,910
759,406
'
Capital outlay
- 2,301,631
641,855
1,659,776
Total charges to appropriations
- 3,933,947
1,514,765
2,419,182
'
Excess of resources over (under)
charges to appropriations
- 9,312,446
11,676,270
2,363,824
'
Fund balance, 30, 2011
$ $ 9,312,446
$ 11,676,270
$ 2,363,824
June
-
'
125
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126
u
n
F,
I
1
7
C
C.
G
L'.
INTERNAL SERVICE FUND
Vehicle Maintenance Fund - Used to account for the cost of operating a maintenance facility for automotive
equipment used by other City departments. Such costs to other departments are billed on a direct cost basis.
The Vehicle Maintenance Fund is responsible for financing replacement vehicles, as necessary.
127
City of Poway
Statement of Net Assets
Internal Service Fund - Vehicle Maintenance Fund
June 30, 2011
ASSETS
Current assets:
Cash and investments
$ 6,258,665
Accounts receivable
1,547
Total current assets
6,260,212
Total assets
6,260,212
LIABILITIES
Current liabilities:
Accounts payable
46,831
Total current liabilities
46,831
Noncurrent liabilities:
Long -term debt due in more than one year
27,595
Total current liabilities
27,595
Total liabilities
74,426
NET ASSETS
Unrestricted
6,185,786
Total net assets
$ 6,185,786
128
City of Poway
Statement of Activities and Changes in Net Assets
Internal Service Fund - Vehicle Maintenance Fund
For the year ended June 30, 2011
'
OPERATING REVENUES:
Charges for services
$ 2,373,738
'
Other
24,089
Total operating revenues
2,397,827
'
OPERATING EXPENSES:
Personnel services
344,206
Maintenance and operations
711,627
Total operating expenses
1,055,833
'
OPERATING INCOME (LOSS)
1,341,994
'NONOPERATING
REVENUES:
Interest
61,756
revenue
Total nonoperating revenues
61,756
'
INCOME (LOSS) BEFORE TRANSFERS
1,403,750
'
TRANSFERS:
Transfers out
(480,926)
'
Total transfers
(480,926)
'
Changes in net assets
922,824
NET ASSETS:
Beginning of year
5,262,962
End of year
$ 6,185,786
t
'
129
City of Poway
Statement of Cash Flows
Internal Service Fund - Vehicle Maintenance Fund
For the year ended June 30, 2011
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash receipts from users
Cash payments to employees for services
Cash payments to suppliers of goods or services
Net cash provided (used) by operating activities
$ 2,396,280
(344,206)
(907,568)
1,144,506
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:
Transfers out (480,926)
Net cash provided (used) by noncapital financing activities (480,926)
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES:
Principal paid on long -term debt (3,203)
Net cash provided (used) by capital and related financing activities (3,203)
CASH FLOWS FROM INVESTING ACTIVITIES:
Interest received 61,756
Net cash provided (used) by capital and related financing activities 61,756
Net increase in cash and cash equivalents
CASH AND CASH EQUIVALENTS:
Beginning of year
End of year
RECONCILIATION OF OPERATING INCOME (LOSS) TO NET
CASH PROVIDED (USED) BY OPERATING ACTIVITIES:
Operating income
Adjustments to reconcile operating income (loss) to
net cash provided (used) by operating activities:
Changes in operating assets and liabilities:
Accounts receivable
Accounts payable
Total adjustments
Net cash provided (used) by operating activities
130
722,133
5,536,532
$ 6,258,665
$ 1,341,994
(1,547)
(195,941)
(197,488)
$ 1,144,506
IAGENCY FUNDS
FIDUCIARY FUNDS
The agency funds are used to account for assets held by the City as an agent. Agency funds include the
' following:
' Developer Deposits Fund - Used to account for the collection and payments of development deposits from
and on behalf of the collective and individual developers.
' South Poway CFD No. 1 Bond Deposits Fund - Used to account for debt service payments CFD No. 1 Bond
Deposits collected through property tax assessments remitted to fiscal agent - trustee for payment on bonds.
' Parkway Business Center CFD No. 88 -1 Bond Deposits Fund - Used to account for debt service payments
tCFD No. 88 -1 Bond Deposits collected through property tax assessments remitted to fiscal agent - trustee for
payment on bonds.
' High Valley Roads AD No. 96 -1 Bond Deposits Fund - Used to account for debt service payments AD No. 96-
1 Bond Deposits collected through property tax assessments remitted to fiscal agent - trustee for payment on
Ibonds.
u
Old Coach Waterline AD No. 01 -1 Bond Deposits Fund - Used to account for debt service payments AD No.
01 -1 Bond Deposits collected through property tax assessments remitted to fiscal agent - trustee for payment
on bonds.
131
City of Poway
Combining Statement of Fiduciary Net Assets
All Agency Funds
June 30, 2011
132
South
Parkway
High
Old Coach
Poway
Business
Valley
Water
CFD No. 1
Center
Road
Line
Developer
Bond
CFD No. 88 -1
AD No. 96-1
AD No. 01 -1
Total
Deposits
Deposits
Bond Deposits
Bond Deposits
Bond Deposits
Agency
Fund
Fund
Fund
Fund
Fund
Funds
ASSETS
Cash and investments
$
3,448,335
$
63,720
$ 3,724,400
$ 54,154
$ 61,770
$
7,352,379
Receivables:
Taxes
-
-
7,195
-
976
8,171
Accounts
-
-
850,000
-
850,000
Interest
-
-
21,363
-
-
21,363
Cash and investments with fiscal agents
-
-
1,658,264
53,750
-
1,712,014
Total assets
$
3,448,335
$
63,720
$ 6,261,222
$ 107,904
$ 62,746
$
9,943,927
LIABILMES
Accounts payable
$
41,672
$
63,720
$ -
$ 4,235
$ -
$
109,627
Deposits
3,406,663
-
-
-
-
3,406,663
Due to bondholders
-
-
5,411,222
103,669
62,746
5,577,637
Advances from City of Poway
-
-
850,000
-
-
850,000
Total liabilities
$
3,448,335
$
63,720
$ 6,261,222
$ 107,904
$ 62,746
$
9,943,927
132
City of Poway
' Combining Statement of Changes in Assets and Liabilities
All Agency Funds
' For the year ended June 30, 2011
' Bal Bal
' Developer Deposits Fund
Assets:
' Cash and investments
Total assets
Liabilities:
' Accounts payable
Deposits
Total liabilities
' South Poway CFD No. 1
Bond Deposits Fund
' Assets:
Cash and investments
' Interest receivable
Cash and investments with fiscal agent
Total assets
' Liabilities:
Accounts payable
Due to bondholders
' Total liabilities
Parkway Business Center
'CFD No. 88-1 Bond Deposits Fund
Assets:
Cash and investments
' Taxes receivable
Accounts receivable
Interest receivable
' Cash and investments with fiscal agent
Total assets
Liabilities:
' Accounts payable
Due to bondholders
Advances from City of Poway
' Total liabilities
ance
July 1, 2010
Additions
Deletions
ance
June 30, 2011
$
4,302,179
$
1,166,732
$ (2,020,576)
$
3,448,335
$
4,302,179
$
1,166,732
$ (2,020,576)
$
3,448,335
$
223,366
$
-
$ (181,694)
$
41,672
$
4,078,813
$
1,166,732
(1,838,882)
$
3,406,663
$
4,302,179
$
1,166,732
$ (2,020,576)
$
3,448,335
$
1,021,023
$
2,239
$ (959,542)
$
63,720
26,669
-
(26,669)
-
1,484,731
981,232
(2,465,963)
-
$
2,532,423
$
983,471
$ (3,452,174)
$
63,720
$
-
$
983,471
$ (919,751)
$
63,720
$
2,532,423
$
-
(2,532,423)
$
-
$
2,532,423
$
983,471
$ (3,452,174)
$
63,720
$
3,995,283
$
3,273,503
$ (3,544,386)
$
3,724,400
-
7,195
-
7,195
1,000,000
-
(150,000)
850,000
21,363
21,363
(21,363)
21,363
1,664,616
3,514,591
(3,520,943)
1,658,264
$
6,681,262
$
6,816,652
$ (7,236,692)
$
6,261,222
$
-
$
3,571,391
$ (3,571,391)
$
-
5,681,262
3,245,261
(3,515,301)
5,411,222
1,000,000
-
(150,000)
850,000
$
6,681,262
$
6,816,652
$ (7,236,692)
$
6,261,222
133
(Continued)
City of Poway
Combining Statement of Changes in Assets and Liabilities
All Agency Funds, Continued
For the year ended June 30, 2011
High Valley Roads
AD No. 96 -1 Bond Deposits Fund
Assets:
Cash and investments
Taxes receivable
Cash and investments with fiscal agents
Total assets
Liabilities:
Accounts payable
Due to bondholders
Total liabilities
Old Coach Waterline
AD No. 2001 -1 Bond Deposits Fund
Assets:
Cash and investments
Taxes receivable
Total assets
Liabilities:
Due to bondholders
Total liabilities
All Agency Funds
Assets:
Cash and investments
Taxes receivable
Accounts receivable
Interest receivable
Cash and investments with fiscal agents
Total assets
Liabilities:
Accounts payable
Deposits
Due to bondholders
Advances from City of Poway
Total liabilities
Balance Balance
July 1, 2010 Additions Deletions June 30, 2011
$
55,580
$
54,651
$ (56,077)
$
54,154
345
3,069
-
(345)
(3,069)
-
$
53,750
$
52,571
(52,571)
$
53,750
$
109,675
$
107,222
$ (108,993)
$
107,904
$
61,959
$
33,329
$ (32,542)
$
62,746
$
4,235
$
60,501
$ (60,501)
$
4,235
$
105,440
$ (12,850,977)
46,721
(48,492)
'
103,669
$
109,675
$
107,222
$ (108,993)
$
107,904
$
59,235
$
32,353
$ (29,818)
$
61,770
2,724
3,069
976
(2,724)
(3,069)
976
$
61,959
$
33,329
$ (32,542)
$
62,746
850,000
'
48,032
21,363
$
61,959
$
33,329
$ (32,542)
$
62,746
$
61,959
$
33,329
$ (32,542)
$
62,746
� I
0
0
$
9,433,300
$
4,529,478
$ (6,610,399)
$
7,352,379
3,069
8,171
(3,069)
8,171
1,000,000
-
(150,000)
850,000
'
48,032
21,363
(48,032)
21,363
3,203,097
4,548,394
(6,039,477)
1,712,014
$
13,687,498
$
9,107,406
$ (12,850,977)
$
9,943,927
'
$
227,601
$
4,615,363
$ (4,733,337)
$
109,627
'
4,078,813
1,166,732
(1,838,882)
3,406,663
8,381,084
3,325,311
(6,128,758)
5,577,637
1,000,000
-
(150,000)
850,000
'
$
13,687,498
$
9,107,406
$ (12,850,977)
$
9,943,927
t
(Concluded)
'
134
' 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
' To the Honorable Mayor and Members of the City Council
of the City of Poway
Poway, California
We have audited the accompanying financial statements of the governmental activities, the business -type
' activities, each major fund, and the aggregate remaining fund information of the City of Poway, California
( "City "), as of and for the year ended June 30, 2011, which collectively comprise the City's basic financial
statements, and have issued our report thereon dated January 13, 2012. 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.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered the City's internal control over financial reporting as
' a basis for designing our auditing procedures 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 over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the
' City's internal control over financial reporting.
A deficiency in internal control exists when the design or operation of a control does not allow management
' or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct
misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in
internal control such that there is a reasonable possibility that a material misstatement of the City's financial
' statements will not be prevented, or detected and corrected on a timely basis.
' 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 deficiencies, significant deficiencies, or material weaknesses. We did not
' identify any deficiencies in internal control over financial reporting that we consider to be material
weaknesses, as defined above.
' 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 provision 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 that are required to be reported under
Government Auditing Standards.
Iwww c- lcpa.com
C &L
Caporicci & Larson, Inc.
'
A Subsidiary of Marcum LLP
Certified Public Accountants
' 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
' To the Honorable Mayor and Members of the City Council
of the City of Poway
Poway, California
We have audited the accompanying financial statements of the governmental activities, the business -type
' activities, each major fund, and the aggregate remaining fund information of the City of Poway, California
( "City "), as of and for the year ended June 30, 2011, which collectively comprise the City's basic financial
statements, and have issued our report thereon dated January 13, 2012. 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.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered the City's internal control over financial reporting as
' a basis for designing our auditing procedures 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 over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the
' City's internal control over financial reporting.
A deficiency in internal control exists when the design or operation of a control does not allow management
' or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct
misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in
internal control such that there is a reasonable possibility that a material misstatement of the City's financial
' statements will not be prevented, or detected and corrected on a timely basis.
' 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 deficiencies, significant deficiencies, or material weaknesses. We did not
' identify any deficiencies in internal control over financial reporting that we consider to be material
weaknesses, as defined above.
' 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 provision 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 that are required to be reported under
Government Auditing Standards.
Iwww c- lcpa.com
To the Honorable Mayor and Members of the City Council
of the City of Poway
Poway, California
Page Two
This report is intended solely for the information and use of management, the City Council others within '
p Y g �'
the City, and federal awarding agencies and pass- through entities and is not intended to be and should not '
be used by anyone other than these specified parties.
Caporicci & Larson, Inc.
A Subsidiary of Marcum LLP
Certified Public Accountants
San Diego, California
January 13, 2012
136
I
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n
11
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i
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P
STATISTICAL SECTION
This part of the City of Poway's comprehensive annual financial report presents detailed
information as context for understanding what the information in the financial statements,
note disclosures, and required supplementary information says about the government's
overall financial health.
Contents
Financial Trends
These schedules contain trend information to help the reader understand
how the government's financial performance and well-being have changed
over time.
Revenue Capacity
These schedules contain information to help the reader assess the government's
most significant local revenue sources.
Debt Capacity
These schedules present information to help the reader assess the affordability
of the government's current levels of outstanding debt and the government's
ability to issue additional debt in the future.
Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader
understand the environment within which the government's financial activities
take place.
Operating Information
These schedules contain service and infrastructure data to help the reader
understand how the information in the government's financial report relates
to the services the government provides and the activities it performs.
Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive
annual financial reports for the relevant year.
137
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138 1
II
II
n
II
II
r
City of Poway
Net Assets by Component,
Current and Prior Five Years
(accrual basis of accounting)
Year Ended Year Ended Year Ended Year Ended Year Ended Year Ended
June 30, 2011 Lune 30, 2010 Tune 30, 2009 June 30, 2008 June 30, 2007 June 30, 2006
Governmental activities
' Business -type activities
Invested in capital assets, net of related debt 94,231,403 89,920,470 75,841,537
Invested in capital assets, net of related debt
$ 50,255,141
$ 46,412,443
$ 36,713,773
$ 28,805,157
$ 21,675,540
$ 16,728,005
Restricted
70,931,373
78,369,565
99,252,462
101,384,182
99,518,581
98,416,094
Unrestricted - as restated
(71,148,492)
(93,996,026)
(98,283,120)
(95,193,402)
(97,582,504)
(105,519,982)
Total governmental activities net assets
50,038,022
30,785,982
3703,115
34,995,937
23,611,617
9,624,117
'
' Business -type activities
Invested in capital assets, net of related debt 94,231,403 89,920,470 75,841,537
63,462,787
56,730,592
Invested in capital assets, net of related debt
43,976,262
43,508,027
39,127,764
34,657,630
35,055,052
36,472,213
Restricted
280, 450
280, 450
280,469
281,531
283,938
283,534
$ 102,446,764
' Unrestricted
36,469,136
35,320,341
34,194,395
32,511,666
30,112,939
25,587,312
Total business -type activities net assets
80,725,848
79,108,818
73,602,628
67,450,827
65,451,929
62,343,059
'
Primary government
Invested in capital assets, net of related debt 94,231,403 89,920,470 75,841,537
63,462,787
56,730,592
53,200,218
Restricted 71,211,823 78,650,015 99,532,931
101,665,713
99,802,519
98,699,628
'
Unrestricted (34,679,356) (58,675,685) (64,088,725)
(62,681,736)
(67,469,565)
(79,932,670)
Total primary government net assets $ 130,763,870 $ 109,894,800 $ 111,285,743
$ 102,446,764
$ 89,063,546
$ 71,967,176
'
Note: The City began to report accrual information when it implemented GASB Statement 34 in
fiscal year 2003. The City implemented the retroactive reporting of infrastructure in fiscal year 2007.
The City is reporting its ten year history with the implentation of GASB 44 in fiscal year 2006.
139
City of Poway
Changes in Net Assets
Current and Prior Five Years
(accrual basis of accounting)
r � M M M M M M M M M M M M M M M M M
Year Ended
Year Ended
Year Ended
Year Ended
Year Ended
Year Ended
Tune 30, 2011
Tune 30, 2010
Tune 30, 2009
Tune 30, 2008
Tune 30, 2007
Tune 30, 2006
Expenses:
Governmental Activities:
General Government
$ 17,144,376
$ 23,947,500
$ 23,261,446
$ 18,616,222
$ 14,559,177
$ 15,689,334
Public Safety
18,899,606
19,475,481
19,227,914
19,039,199
18,121,264
17,313,198
Public Works
12,622,204
12,595,756
11,213,841
10,607,352
9,100,534
13,023,698
Development Services
2,348,622
4,423,865
5,226,071
5,367,148
4,978,301
Community Services
14,398,426
25,213,955
16,195,999
18,329,674
16,964,745
19,510,067
Interest and fiscal charges
17,232,642
14,969,311
16,692,399
17,038,330
19,697,044
16,986,839
Total governmental expenses
82,645,876
100,625,868
91,817,670
88,997,925
83,421,065
82,523,136
Business -type activities:
Water
18,143,829
18,226,463
18,697,576
17,534,682
17,371,707
16,009,205
Sewer
7,651,228
7,522,634
8,011,470
7,743,880
7,970,848
8,730,098
Total business -type expenses
25,795,057
25,749,097
26,709,046
25,278,562
25,342,555
24,739,303
Total primary government expenses
108,440,933
126,374,965
5 118,526,716
114,276,487
108,763,620
107,262,439
Program revenues:
Governmental Activities:
° Charges for services:
General Government
$ 96,397
$ 91,745
$ 105,084
$ 133,893
$ 176,938
$ 173,484
Public Safety
2,121,984
2,131,729
2,413,197
2,068,632
2,181,971
2,104,975
Public Works
4,422,522
4,479,896
4,868,530
4,327,217
4,011,644
3,512,623
Development Services
1,584,838
1,332,714
1,388,448
1,522,060
1,451,489
Community Services
2,111,476
2,821,718
3,033,466
2,935,862
2,894,396
3,908,179
Interest and fiscal charges
-
-
-
-
-
Operating grants and contributions
5,857,360
7,615,477
5,826,044
6,478,997
6,103,045
6,198,885
Capital grants and contributions
1,155,384
1,246,555
2,110,463
5,128,657
2,940,273
3,088,436
Total program revenues
17,349,961
19,719,834
19,745,232
22,595,318
19,759,756
18,986,582
Business -type activities:
Charges for services:
Water
18,694,318
17,881,695
16,714,571
16,806,379
16,637,705
15,181,771
Sewer
8,759,001
8,651,681
8,651,968
8,440,646
7,943,890
7,479,071
Captial grants and contributions
-
-
-
-
63,604
66,840
Total program revenues
27,453,319
26,533,376
25,366,539
25,247,025
24,645,199
22,727,682
Total primary government program revenue 44,803,280
46,253,210
45,111,771
47,842,343
44,404,955
41,714,264
Net (expense)/ revenue
Governmental activities
(65,295,915)
(80,906,034)
(72,072,438)
(66,402,607)
(63,661,309)
(63,536,554)
Business -type activities
1,658,262
784,279
1,342,50
31,53
697,356
2,011,621
Total primary government net (expense)
(63,637,653)
(80,121,755)
(73,414,945)
(66,434,144)
64,358,665
65,548,175
r � M M M M M M M M M M M M M M M M M
Year Ended
Year Ended
Year Ended
Year Ended
Year Ended
Year Ended
Tune 30, 2011
Tune 30, 2010
Tune 30, 2009
Tune 30, 2008
Tune 30, 2007
Tune 30, 2006
General revenues and Other Changes
in Net Assets:
Governmental Activities:
Taxes:
Property taxes
$ 50,960,736
$ 51,526,758
$ 51,190,712
$ 50,669,452
$ 48,048,249
$ 45,725,853
Sales taxes
10,418,322
9,833,390
10,325,455
12,904,265
13,032,518
13,918,879
Motor vehicle license tax
262,412
150,641
173,673
225,353
273,727
392,240
Transient occupancy tax
433,934
367,434
247,787
206,323
202,767
190,097
Franchise taxes
1,465,926
1,491,231
1,590,066
1,497,724
1,588,677
1,399,524
Other Taxes
616,466
629,589
597,880
598,965
596,868
609,982
Total taxes
64,157,796
63,999,043
64,125,573
66,102,082
63,742,806
62,236,575
Investment earnings
5,964,802
8,287,516
9,879,153
10,639,352
10,569,205
8,508,647
Miscellaneous
512,858
1,251,844
607,387
714,405
3,349,606
2,894,418
Sale of capital assets
13,561,625
-
-
-
-
(11,262)
Transfers
350,874
470,498
147,503
331,088
(12,808)
460,810
Total governmental activities
84,547,955
74,008,901
74,759,616
77,786,927
77,648,809
74,089,188
Business -type activities:
Property taxes
-
-
-
-
-
309,296
Investment earnings
254,279
463,177
1,987,778
2,283,493
3,038,852
1,157,563
Contributed capital
-
4,225,637
4,720,039
-
-
-
Miscellaneous
55,363
503,595
933,994
78,030
754,566
738,337
Transfers
(350,874)
(470,498)
(147,503)
(331,088)
12,808
(460,810)
Total business -type activities
41,232
4,721,911
7,494,308
2,030,435
3,806,226
1,744,386
Total primary government
84,506,723
78,730,812
82,253,924
79,817,362
81,455,035
75,833,574
r-�
It Change in Net Assets
Governmental activities
$ 19,252,040
$ (6,897,133)
$ 2,687,178
$ 11,384,320
$ 13,987,500
$ 10,552,634
Business -type activities
1,617,030
5,506,190
6,151,801
1,998,898
3,108,870
267,235
Total primary government
20,869,070
1,390,943
8,838,979
13,383,218
17,096,370
10,285,399
Note: The City began to report accrual information when it implemented GASB Statement 34 in
fiscal year 2003. The City implemented the retroactive reporting
of infrastructure in fiscal year 2007.
The City is reporting its ten year history with the implentation of
GASB 44 in fiscal year 2006.
City of Poway
Fund Balances, Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
General Fund
Non - spendable
Restricted
Committed
Assigned
Unassigned
Reserved
Unreserved:
Designated
Undesignated
Total General Fund
All Other Governmental Funds
Non - spendable
Restricted
Committed
Assigned
Unassigned
Reserved
Unreserved:
Designated:
Special revenue funds
Debt service funds
Capital projects funds
Undesignated:
Special revenue funds
Debt service funds
Capital projects funds
Total all Other Governmental Funds
Total Fund Balance
June 30,
2011
2010
2009
2008
2007
$ 10,151,108
4,676,562
5,278,620
$
91,980,017
10,037,638
6,466,719
23,955,240
121,527,214
$
114,742,011
$
$
4,647,709 $
5,561,391 $
8,478,531 $
7,538,564
31,724,737
32,152,754
31,160,911
30,375,251
$ 50,610,705 $
36,372,446 $
37,714,145 $
39,639,442 $
37,913,815
62,440,327
8,564,840
(88,658)
$ 51,660,768 $ 62,868,328 $ 55,650,435 $ 43,663,739
20,795,704
24,840,402
32,578,654
43,037,658
5,913,093
5,982,341
4,676,562
5,278,620
$
70,916,509
$
78,369,565
$
93,691,071
$
92,905,651
$
91,980,017
$
121,527,214
$
114,742,011
$
131,405,216
$
132,545,093
$
129,893,832
142
June 30,
'
2006
2005
2004
2003
2002
' $
7,389,245
7,885,013
7,581,391
6,907,055
16,683,177
27,539,942
25,115,075
21,827,076
12,325,729
21,258,117
'
8,556,645
$
34,929,187
33,000,088
29,408,467
27,789,429
37,941,294
' $
39,477,985
35,478,892
44,761,898
51,282,639
49,W,668
'
7,760,635
8,816,961
8,175,996
8,613,436
8,133,105
'
6,014,938
7,795,241
7,804,756
6,898,403
5,207,265
37,769,191
42,511,597
55,342,242
44,896,736
60,711,652
' $
91,022,749
94,602,691
116,084,892
111,691,214
123,112,690
$
161,053,984
125,951,936
127,602,779
145,493,359
139,480,643
'
143
City of Poway
Changes In Fund Balances, Governmental Funds
Last Ten Fiscal Years
(modified accrual basis of accounting)
Note: The City implemented GASB 34 beginning with the fiscal year ended June 30, 2003. Prior to that time, interfund loans where
treated as "Other Financing Sources" and classified as "Proceeds from issuance of debt" in the fund receiving the loan.
144
Year Ended June 30,
2011
2010
2009
2008
Revenues
Taxes
$ 66,623,806 $
67,411,848 $
66,062,646 $
68,817,462
Licenses and permits
457,905
433,517
422,948
328,159
Intergovernmental
1,800,145
2,994,005
2,889,804
3,971,720
Charges for services
3,232,221
3,140,274
2,954,967
2,676,329
Fines and forfeitures
678,468
750,551
852,535
803,552
Use of money and property
7,821,732
12,180,028
14,862,137
15,516,351
Developer Fees
4,516,243
3,711,578
3,897,877
3,780,128
Assessment levied
1,902,409
1,886,300
1,873,179
1,892,326
Other revenues
729,933
2,228,662
1,013,135
2,568,693
Total revenues
87,762,862
94,736,763
94,829,228
100,354,720
Expenditures
Current:
General government
2,680,162
6,056,348
6,733,135
7,252,320
Public safety
18,328,287
18,966,380
18,673,036
18,528,701
Public works
9,990,368
9,943,681
8,566,157
8,009,622
Development services
2,388,077
4,475,943
5,279,297
5,420,200
Community services
9,894,345
9,048,983
9,741,990
12,593,136
Capital outlay
16,818,821
27,639,839
17,981,861
18,354,376
Debt service:
Principal
6,703,020
7,150,000
6,855,000
6,560,000
Principal -early retirement -sale of capital asset
26,720,000
Interest and fiscal charges
17,972,119
14,943,766
16,732,005
17,077,417
Debt Issuance Costs
_
_
_
_
Tax shift
2,820,770
13,700,882
-
-
Tax increment reimbursements
5,948,554
2,380,740
6,205,709
5,515,447
Total expenditures
120,264,523
114,306,562
96,768,190
99,311,219
Excess of revenues over (under) expenditures
(32,501,661)
(19,569,799)
(1,938,962)
1,043,501
Other Financing Sources (Uses)
Proceeds from issuance of debt
169,930
161,049
154,734
151,285
Refunding bond activity -net
-
_
-
_
Proceeds from sale of capital assets
38,300,000
-
-
_
Transfers in (out) net
831,800
2,745,545
644,351
1,456,475
Total other financing sources
39,301,730
2,906,594
799,085
1,607,760
Net change in fund balance
$ 6,800,069 $
(16,663,205) $
(1,139,877) $
2,651,261
Debt service as a percentage of noncapital expenditures
22-1%
21.3%
25.8%
26.2%
Note: The City implemented GASB 34 beginning with the fiscal year ended June 30, 2003. Prior to that time, interfund loans where
treated as "Other Financing Sources" and classified as "Proceeds from issuance of debt" in the fund receiving the loan.
144
Year Ended June 30,
'
2007
2006
2005
2004
2003
2002
$
63,810,241 $
62,042,614 $
55,406,112 $
47,368,683 $
43,439,827 $
39,575,352
330,755
296,935
288,716
296,984
295,471
305,685
'
4,336,767
5,796,558
4,637,517
5,445,572
8,313,394
6,183,143
4,419,664
7,557,159
7,607,467
7,449,929
8,452,248
8,192,172
720,949
732,633
273,322
251,834
176,291
202,598
'
16,120,443
13,459,180
13,535,451
8,152,189
11,924,593
12,584,448
4,509,741
489,210
536,404
1,243,389
1,208,015
591,230
1,868,567
1,845,859
1,835,519
1,816,524
1,825,528
1,754,096
'
1,389,762
1,157,139
2,525,614
1,473,492
2,007,778
3,000,545
97,506,889
93, 377, 287
86, 646, 122
73 ,498,596
77,643,145
72,389,269
9,614,109
9,552,247
11,114,009
10,668,972
10,178,866
8,918,157
17,897,811
16,563,059
17,304,746
15,588,991
13,866,595
12,905,831
'
6,556,796
11,338,373
4,865,184
3,966,484
4,246,773
3,817,814
5,028,405
11,877,425
11,884,718
10,671,636
7,569,324
7,373,691
6,579,853
'
14,205,962
18,802,010
31,981,651
31,743,517
32,096,700
22,972,729
6,470,000
5,875,000
6,706,720
7,875,000
14,192,769
9,288,293
'
17,896,630
17,101,983
16,482,351
15,477,533
18,455,993
15,095,386
-
-
255,302
2,765,590
-
1,708,370
'
-
1,674,851
2,549,564
1,357,911
780,349
-
4,889,025
3,831,350
2,380,488
29,865,057
5,678,795
4,928,042
94,436,163
96,623,591
104,311,651
126,878,379
106,870,531
86,214,475
3,070,726
(3,246,304)
(17,665,529)
(53,379,783)
(29,227,386)
(13,825,206)
'
148,273
149,563
8,499,883
156,029,702
17,856,218
80,781,467
(184,586)
-
(9,301,120)
(99,094,350)
-
(8,005,801)
-
-
232,168
1,110,603
14,600,000
-
'
907,483
1,445,898
506,234
1,346,544
658,650
640,108
871,170
1,595,461
(62,835)
59,392,499
33,114,868
73,415,774
' $
3,941,896 $
(1,650,843) $
(17,728,364) $
6,012,716 $
3,887,482 $
59,590,568
29.1%
26.4%
27.3%
19.9%
38.9%
38.6%
'
145
City of Poway
Assessed Value of Taxable Property '
Last Ten Fiscal Years
Fiscal Year
Assessed Value
'
Ended
Personal
Net Taxable
June 30,
Land
Improvments
Property
Total
Exemptions
Value
2002
1,921,113,526
2,857,873,316
162,481,953
4,941,468,795
(118,250,152)
4,823,218,643
2003
2,128,867,560
3,119,821,315
200,414,378
5,449,103,253
(145,945,106)
5,303,158,147
2004
2,338,197,043
3,315,524,886
190,767,595
5,844,489,524
(171,519,517)
5,672,970,007
2005
2,611,610,220
3,535,334,922
187,042,681
6,333,987,823
(214,007,737)
6,119,980,086
'
2006
2,991,468,898
3,840,250,821
245,308,882
7,077,028,601
(217,368,560)
6,859,660,041
2007
3,230,084,121
4,191,380,246
278,291,264
7,699,755,631
(229,216,072)
7,470,539,559
2008
3,525,237,590
4,412,172,141
272,804,881
8,210,214,612
(229,932,712)
7,980,281,900
'
2009
3,647,796,486
4,472,160,193
254,000,489
8,373,957,168
(244,967,192)
8,128,989,976
2010
3,640,861,781
4,548,446,929
288,729,686
8,478,038,396
(261,984,967)
8,216,053,429
2011
3,606,251,228
4,540,602,915
276,448,124
8,423,302,267
(255,814,376)
8,167,487,891
'
In 1978 the voters of the State of California passed Proposition 13 which resulted in dramatic tax reform as it relates to '
property tax collections. Proposition 13 established a property tax of 1% based upon the assessed value of the property
being taxed. Each year the assessed value of property may be increased by an "inflation factor" that may not exceed 2 %.
With few exceptions, property is only re- assessed at the time that it is sold to a new owner. At that point the new assessed
value is fixed at the purchase price of the property. Due to the nature of Proposition 13, over time the assessed value base '
has become significantly undervalued when compared to the true market value of the property. Because the true market
value is not tied to any type of annual valuation process, there is no reliable means of determining the market value of the
parcels within the City and therefore this amount is not disclosed.
Source: San Diego County Assessors Office
n
146 1
'
Change
Estimated
Total
From
Tax
Direct
Prior Year
Revenues
Tax Rate
11.35%
5,616,359
0.211%
9.95%
5,954,586
0.211%
6.97%
6,399,317
0.211%
7.88%
6,895,981
0.211%
12.09%
7,615,898
0.211%
8.91%
8,358,741
0.211%
6.82%
8,939,836
0.211%
1.86%
9,117,319
0.211%
'
1.07%
-0.59%
9,024,247
9,005,230
0.211%
0.211%
147
City of Poway
Direct and Overlapping Property Tax Rates
Last Ten Fiscal Years
In 1978, California voters passed Proposition 13 which resulted in dramatic tax reform as it relates to property tax. Proposition 13 set the
property tax rate at a 1.00% fixed amount. This 1.00% is shared by all taxing agencies for which the subject property resides within. Because
the rate is fixed at 1.00 %, the rate for each taxing agency shares within the 1.00% does not change materially from year -to -year. Rates over the
one percent are for voter approved bond indebtedness
Source: San Diego County Assessors Office
148
Overlapping Rates
Poway
Educational
Palomar
Total 1%
Fiscal Year
City
Unified
Revenue
Community
Property
Ended
Direct
School
San Diego
Augmentation
College
All
Tax
June 30,
Rate
District
County
Fund
District
Other
Rate
2002
0.211%
0.389%
0.167%
0.118%
0.067%
0.047%
1.000%
2003
0.211%
0.389%
0.167%
0.118%
0.067%
0.047%
1.000%
2004
0.211%
0.389%
0.167%
0.118%
0.067%
0.047%
1.000%
2005
0.211%
0.389%
0.167%
0.118%
0.067%
0.047%
1.000%
2006
0.211%
0.389%
0.167%
0.118%
0.067%
0.047%
1.000%
2007
0.211%
0.389%
0.167%
0.118%
0.067%
0.047%
1.000%
2008
0.211%
0.389%
0.167%
0.118%
0.067%
0.047%
1.000%
2009
0.211%
0.389%
0.167%
0.118%
0.067%
0.047%
1.000%
2010
0.211%
0.389%
0.167%
0.118%
0.067%
0.047%
1.000%
2011
0.211%
0.389%
0.167%
0.118%
0.067%
0.047%
1.000%
Rates for Voter Approved Bond Indebtedness
Total 1%
Poway
Total
Fiscal Year
Property
Unified
Property
Ended
Tax
City
School
All
Tax
June 30,
Rate
Rate
District
Other
Rate
2002
1.000%
0.010%
0.000%
0.009%
1.019%
2003
1.000%
0.010%
0.000%
0.007%
1.018%
2004
1.000%
0.000%
0.052%
0.007%
1.059%
2005
1.000%
0.007%
0.047%
0.006%
1.060%
2006
1.000%
0.007%
0.043%
0.023%
1.072%
2007
1.000%
0.000%
0.046%
0.022%
1.069%
2008
1.000%
0.000%
0.045%
0.032%
1.077%
2009
1.000%
0.000%
0.047%
0.035%
1.082%
2010
1.000%
0.000%
0.055%
0.031%
1.086%
2011
1.000%
0.000%
0.055%
0.042%
1.097%
In 1978, California voters passed Proposition 13 which resulted in dramatic tax reform as it relates to property tax. Proposition 13 set the
property tax rate at a 1.00% fixed amount. This 1.00% is shared by all taxing agencies for which the subject property resides within. Because
the rate is fixed at 1.00 %, the rate for each taxing agency shares within the 1.00% does not change materially from year -to -year. Rates over the
one percent are for voter approved bond indebtedness
Source: San Diego County Assessors Office
148
n
n
City of Poway
Principal Secured Property Tax Payers
Current Year and Nine Years Ago
Source: San Diego County Assessors Office
n
n
II
II
II
149
'
2011
2002
Taxable
% of Total
Taxable
% of Total
Assessed
City Assessed
Assessed
City Assessed
Secured Value
Rank
Secured Value
Secured Value
Rank
Secured Value
Poway I LLC
$ 118,935,921
1
1.40%
0.00%
'Slough
Sorento West Properties
114,062,370
2
1.35%
=
0.00%
PDP Pomerado LLC
70,893,303
3
0.84%
-
0.00%
Sysco Food Services
36,230,582
4
0.43%
$ 18,618,533
7
0.38%
'Government
Employees Insurance Company
34,489,899
5
0.41%
26,278,145
2
0.53%
Toray Membrane USA Inc
33,944,223
6
0.40%
-
0.00%
Costco Wholesale Corporation
29,850,000
7
0.35%
-
0.00%
'Poway
Crossings Investors LLC
29,622,691
8
0.35%
-
0.00%
Fairfield Township LLC
27,201,360
9
0.32%
0.00%
PR Stowe LLC
26,754,803
10
0.32%
-
0.00%
Applied Micro Circuits Corporation
-
-
34,082,268
1
0.69%
Resmed Corporation
22,888,699
3
0.46%
Cohu Inc.
-
-
22,449,721
4
0.45%
'First
American Title Insurance Co.
Regency Centers LP
_
-
20,130,925
20,090,910
5
6
0.41%
0.41%
Pacific Star -Poway LLC
-
-
17,133,000
8
0.35%
Prudential Insurance
-
-
16,772,798
9
0.34%
'
Western Silver Oaks Partners LP
-
-
14,447,200
10
0.29%
$ 521,985,152
6.16%
$ 212,892,199
4.31%
Source: San Diego County Assessors Office
n
n
II
II
II
149
City of Poway
Assessed Value of Taxable Property
Redevelopment Tax Increment Property Tax
Last Ten Fiscal Years
Fiscal Year
Ended
June 30,
Land Improvements
Assessed Value
Personal
Property Total Exemptions
I
j
Base Year '
Values
2002
874,897,982
1,373,748,814
116,806,955
2,365,453,751
(14,732,381)
(186,287,869)
2003
984,697,076
1,545,545,528
167,042,477
2,697,285,081
(26,741,073)
(186,287,869)
2004
11069,060,617
1,644,074,499
157,368,510
2,870,503,626
(40,683,262)
(186,287,869)
2005
1,190,799,171
1,756,732,835
145,512,135
3,093,044,141
(51,334,639)
(186,287,869)
2006
1,366,315,823
1,923,849,526
205,148,011
3,495,313,360
(54,732,751)
(186,287,869)
2007
1,455,401,981
2,087,221,327
219,066,696
3,761,690,004
(61,891,980)
(186,287,869)
2008
1,590,220,327
2,198,461,319
212,387,349
4,001,068,995
(66,618,692)
(186,287,869)
2009
1,666,217,121
2,208,050,046
191,508,808
4,065,775,975
(66,638,280)
(186,287,869)
2010
1,698,144,577
2,286,610,454
213,648,005
4,198,403,036
(68,141,344)
(186,287,869)
2011
1,669,652,573
2,277,541,902
210,644,139
4,157,838,614
(67,140,049)
(186,287,869)
In 1978 the voters of the State of California passed Proposition 13 which resulted in dramatic tax reform as it relates to
property tax collections. Proposition 13 established a property tax of 1% based upon the assessed value of the property
being taxed. Each year the assessed value of property may be increased by an "inflation factor" that may not exceed 2 %.
With few exceptions, property is only re- assessed at the time that it is sold to a new owner. At that point the new assessed
value is fixed at the purchase price of the property. Due to the nature of Proposition 13, over time the assessed value base
has become significantly undervalued when compared to the true market value of the property. Because the true market
value is not tied to any type of annual valuation process, there is no reliable means of determining the market value of the
parcels within the City and therefore this amount is not disclosed.
Source: San Diego County Assessors Office
150
i
I I
f
F,
n
II
I I
151
Change
Estimated
Total
Net Taxable
From
Tax
Direct
Value
Prior Year
Revenues
Tax Rate
2,164,433,501
15.59%
22,171,626
1.024%
2,484,256,139
14.78%
25,377,236
1.022%
2,643,532,495
6.41%
26,732,816
1.011%
2,855,421,633
8.02%
29,031,365
1.017%
3,254,292,740
13.97%
33,064,572
1.016%
3,513,510,155
7.97%
35,445,525
1.009%
3,748,162,434
6.68%
37,854,271
1.010%
3,812,849,826
1.73%
38,500,704
1.010%
3,943,973,823
3.44%
39,822,711
1.010%
3,904,410,696
-1.00%
39,482,933
1.011%
151
City of Poway
Redevelopment Property Tax Levies
and Collections
'
Last Ten Fiscal Years
1
Within The Year of Levy
Collections
Fiscal Year
Current
Current
Percent
From Prior
'
Ended
Secured
Secured
of Levy
Years'
Total
June 30,
Tax Levy
Collected
Collected
Levies
Collections
'
2002
22,075,411
21,850,407
98.98%
370,732
22,221,139
2003
25,285,115
25,033,065
99.00%
383,654
25,416,719
2004
26,637,504
26,397,127
99.10%
419,490
26,816,617
'
2005
28,914,339
28,583,331
98.86%
387,359
28,970,690
2006
32,938,833
32,397,596
98.36%
494,520
32,892,116
2007
35,319,838
34,426,834
97.47%
629,698
35,056,532
'
2008
37,650,893
36,657,780
97.36%
930,938
37,588,718
2009
38,031,377
37,099,651
97.55%
1,465,939
38,565,590
2010
39,609,344
38,592,272
97.43%
1,495,015
40,087,287
2011
39,189,880
38,684,907
98.71%
1,399,870
40,084,777
'
Source: San Diego County Assessors Office
'
1
'
152
'
City f Poway
Y
'General
Property Tax Levies and Collections
Last Ten Fiscal Years
Within The Year of Levy
Collections
'
Fiscal Year
Current
Current
Percent
From Prior
Ended
Secured
Secured
of Levy
Years'
Total
'
June 30,
Tax Levy
Collected
Collected
Levies
Collections
2002
14,105,425
13,958,405
98.96%
173,832
14,132,237
2003
14,461,370
14,250,473
98.54%
213,119
14,463,592
t
2004
14,539,338
14,432,902
99.27%
250,896
14,683,798
2005
15,074,377
14,925,461
99.01%
124,804
15,050,265
2006
15,924,752
15,669,141
98.39%
153,982
15,823,123
2007
16,494,681
16,171,714
98.04%
269,763
16,441,477
'
2008
17,034,013
16,641,698
97.70%
329,517
16,971,215
2009
17,295,459
16,805,480
97.17%
378,562
17,184,041
2010
16,665,674
16,276,757
97.67%
490,668
16,767,426
'
2011
14,772,947
14,515,679
98.26%
411,305
14,926,983
Source: San Diego County
Assessors Office
'
153
City of Poway
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
154
Loan General
Payable Obligation
41,416
1,955,000
40,572
Governmental Activities
Fiscal Year
Tax
Certificates
525,000
Ended
Allocation
of
Capital
June 30,
Bonds
Participation
Leases
2,400,513
-
2,542,009
2002
214,455,000
51,915,000
199,638
2003
211,895,000
58,740,000
150,674
2004
260,910,000
57,410,000
98,711
2005
256,350,000
55,395,000
43,565
2006
251,675,000
54,195,000
-
2007
247,395,000
52,810,000
-
2008
242,280,000
51,365,000
-
2009
236,940,000
49,850,000
-
2010
231,385,000
48,255,000
-
2011
225,610,000
20,690,000
-
Notes: Details regarding the city's outstanding debt can be found in the notes to the financial statements.
Source: City of Poway Finance Department
154
Loan General
Payable Obligation
41,416
1,955,000
40,572
1,500,000
1,939,667
1,025,000
2,120,310
525,000
2,169,647
-
2,201,788
-
2,250,467
-
2,282,702
-
2,400,513
-
2,542,009
-
Business -type
Activities
Total
Percentage
Revenue
Capital
Contract
Primary
of Personal
Per
t
Bonds
Leases
Payable
Government
Income
Capita
2,675,000
83,462
5,407
271,329,923
15.74%
5,464
'
2,540,000
62,993
5,407
274,934,646
15.49%
5,517
2,400,000
41,268
5,407
323,830,053
16.85%
6,396
'
2,250,000
2,095,000
18,213
5,407
316,707,495
310,134,647
15.64%
14.36%
6,250
6,136
1,930,000
-
-
304,336,788
13.48%
5,987
1,760,000
-
-
297,655,467
12.39%
5,825
'
1,580,000
-
-
290,652,702
12.44%
5,685
1,390,000
283,430,513
12.22%
5,445
1,190,000
-
-
250,032,009
11.37%
5,192
155
City of Poway
Ratios of General Bonded Debt Outstanding
Last Ten Fiscal Years
Notes:
Details regarding the city's outstanding debt can be found in the notes to the financial statements.
(a) Assessed value has been used because the actual value of taxable property is not readily
available in California.
Source: City of Poway Finance Department
156
Outstanding
General
Bonded Debt
Fiscal Year
Tax
Percent of
Ended
Allocation
Assessed
Per
June 30,
Bonds
Value (a)
Capita
2002
214,455,000
4.34%
4,319
2003
211,895,000
3.89%
4,252
2004
260,910,000
4.46%
5,153
2005
256,350,000
4.05%
5,059
2006
251,675,000
3.56%
4,980
2007
247,395,000
3.21%
4,867
2008
242,280,000
2.95%
4,741
2009
236,940,000
2.83%
4,634
2010
231,385,000
2.73%
4,445
2011
225,610,000
2.68%
4,685
Notes:
Details regarding the city's outstanding debt can be found in the notes to the financial statements.
(a) Assessed value has been used because the actual value of taxable property is not readily
available in California.
Source: City of Poway Finance Department
156
d
C
11
City of Poway
Direct and Overlapping Debt
As of June 30, 2011
2010 -11 Assessed Valuation: $ 8,245,166,266
Redevelopment Incremental Valuation: 3,904,410,696
Adjusted Assessed valuation: $ 4,340,755,570
OVERLAPPING TAX AND ASSESSMENT DEBT:
Metropolitan Water District
Poway Unified School District Facilities Improvement Dist No. 2002 -1
Poway Unified School District Facilities Improvement Dist No. 2007 -1
Palomar Community College District
Escondido Union High School District
San Pasqual Union High School District
Palomar Pomerado Hospital District
City of Poway Community Facilities District No. 88 -1
Poway Unified School District Community Improvement Dist No.1
City of Poway 1915 Act Bonds
TOTAL OVERLAPPING TAX AND ASSESSMENT DEBT
OVERLAPPING GENERAL FUND DEBT:
San Diego County General Fund Obligations
San Diego County Pension Obligations
San Diego County Superintendent of Schools General Fund Obligations
Palomar Community College District Certificates of Participation
Escondido Union High School District Certificates of Participation
Poway Unified School District Certificates of Participation
TOTAL OVERLAPPING GENERAL FUND DEBT
TOTAL OVERLAPPING DEBT
DIRECT GENERAL FUND DEBT:
City of Poway Certificates of Participation
TOTAL DIRECT AND OVERLAPPING DEBT
Ratios to Assessed Valuation:
Total Overlapping Tax and Assessment Debt 1.78%
Ratios to Adjusted Assessed Valuation:
Combined Direct Debt ($20,690,000) 0.48%
Combined Total Debt 4.67%
State School Building Aid Repayable as of 6/30/11: $ -
Notes:
(a) Percentage of overlapping agency's assessed valuation located within boundaries of the city.
(b) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and tax allocation bonds
and non - bonded capital lease obligations.
Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the City. This schedule
estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents and businesses
of the City. This process recognizes that, when considering the City's ability to issue and repay long -term debt, the entire
debt burden borne by the residents and businesses should be taken into account. However, this does not imply that every
taxpayer is a resident, and therefore responsible for repaying the debt, of each overlapping government.
Source: California Municipal Statistics, Inc.
157
Estimated Share
Debt
%
of Overlapping
Outstanding
Applicable (a)
Debt
$
227,670,000
0.241%
$ 548,685
175,999,320
26.098%
45,932,303
98,996,943
26.827%
26,557,910
322,528,901
5.638%
18,184,179
85,751,275
0.113%
96,899
781,351
2.794%
21,831
481,514,998
8.543%
41,135,826
13,530,000
100.000%
13,530,000
40,075,000
0.391%
156,693
400,756
100.000%
400,756
1,447,248,544
146,565,082
$
385,650,000
1.266%
$ 4,882,329
820,288,160
1.266%
10,384,848
19,992,500
1.266%
253,105
6,275,000
5.638%
353,785
60,955,000
0.113%
68,879
127,465,490
15.249%
19,437,213
$
1,420,626,150
$ 35,380,159
$
2,867,874,694
$ 181,945,241 (b)
20,690,000
100.000%
20,690,000
$ 202,635,241
$
2,888,564,694
Notes:
(a) Percentage of overlapping agency's assessed valuation located within boundaries of the city.
(b) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and tax allocation bonds
and non - bonded capital lease obligations.
Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the City. This schedule
estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents and businesses
of the City. This process recognizes that, when considering the City's ability to issue and repay long -term debt, the entire
debt burden borne by the residents and businesses should be taken into account. However, this does not imply that every
taxpayer is a resident, and therefore responsible for repaying the debt, of each overlapping government.
Source: California Municipal Statistics, Inc.
157
City of Poway
Legal Debt Margin Information
Last Ten Fiscal Years
FISCAL YEAR
2011
2010 2009 2008
Assessed valuation $ 4,340,755,570 $
4,350,898,397 $ 4,394,570,216 $ 4,310,588,610
Conversion percentage 25%
25% 25% 25%
Adjusted assessed valuation 1,085,188,893
1,087,724,599 1,098,642,554 1,077,647,153
Debt limit percentage 15%
15% 15% 15%
Debt limit 162,778,334
163,158,690 164,796,383 161,647,073
Total net debt applicable to limit:
General obligation bonds -
- - -
Legal debt margin 0.00%
0.00% 0.00% 0.00%
The Government Code of the State of California provides for a legal debt limit of
15% of gross assessed valuation. However, this provision was enacted when
assessed valuation was based upon 25% of market value. Effective with the 1981 -82
fiscal year, each parcel is now assessed at 100% of market value (as of the most
recent change in ownership for that parcel). The computations shown above reflect
a conversion of assessed valuation data for each fiscal year from the current full
valuation perspective to the 25% level that was in effect at the time that the legal
debt margin was enacted by the State of California for local governments located
within the state.
Notes: Details regarding the city's outstanding debt can be found in the notes to the financial statements.
Source:
City of Poway Finance Department
San Diego County Assessors Office
158
FISCAL YEAR
'
2007
2006
2005
2004
2003
2002
$
4,035,420,029 $
3,683,578,609 $
3,341,441,046 $
3,106,118,400 $
2,894,214,986 $
2,734,305,211
'
25%
25%
25%
25%
25%
25%
'
1,008,855,007
920,894,652
835,360,262
776,529,600
723,553,747
683,576,303
15%
15%
15%
15°%
15%
15%
'
151,328,251
138,134,198
125,304,039
116,479,440
108,533,062
102,536,445
'
-
-
243,728
491,401
466,036
790,018
0.00%
0.00°%
0.19%
0.42%
0.43%
0.77°%
t
159
City of Poway
Pledged Revenue Coverage
Last Ten Fiscal Years
Fiscal Year
Ended Tax
Tax Allocation Bonds
Debt Service
June 30,
Increment
Principal
Interest
17,498,444
1.58
2002
23,503,772
2,370,000
11,418,952
2003
26,247,819
2,560,000
11,571,940
2004
27,665,286
6,545,000
10,953,444
2005
30,428,470
4,560,000
13,740,175
2006
34,109,857
4,675,000
12,781,669
2007
36,011,865
5,085,000
12,328,271
2008
38,256,892
5,115,000
12,299,556
2009
38,940,302
5,340,000
12,068,451
2010
39,377,603
5,555,000
11,877,545
2011
39,015,261
5,775,000
11,658,142
Notes: Details regarding the city's outstanding debt
can be found in the notes
to the financial statements.
Source: City of Poway
Finance Department
160
Total Coverage
13,788,952
1.70
14,131,940
1.86
17,498,444
1.58
18,300,175
1.66
17,456,669
1.95
17,413,271
2.07
17,414,556
2.20
17,408,451
2.24
17,432,545
2.26
17,433,142
2.24
161
City of Poway
'
Demographic and Economic Statistics
Last Ten Calendar Years
Per
'
Capita
Calendar Personal
Personal
Labor
Unemployment
'
Year Population Income
Income
Force
Rate
2002 49,658 1,724,076,102
34,719
26,200
3.0%
'
2003 49,833 1,775,051,460
2004 50,632 1,922,243,880
35,620
37,965
26,400
26,900
3.2%
2.8%
2005 50,675 2,025,072,272
39,962
27,300
2.5%
2006 50,542 2,159,204,782
42,721
27,400
2.4%
2007 50,830 2,258,376,900
44,430
28,000
2.7%
2008 51,103 2,402,914,163
47,021
28,600
3.5%
2009 51,126 2,336,764,956
45,706
28,100
6.1%
'
2010 52,056 2,318,838,039
44,545
28,000
6.3%
2011 48,155 2,198,908,930
45,663
27,900
6..2%
Source:
Population - State of California Department of Finance
Personal Income - State of California Department of Finance/ U.S. Bureau of Economic Analysis
'
Employment Information - State of California Employment Development Department
161
City of Poway
Principal Employers
Current Year and Five Years Prior
Employer
2011
Percent of
Number of Total
Employees Rank Employment
General Atomics Aeronautical Systems
2,561
1
9.18%
Geico Direct
1,720
2
6.16%
Poway Unified School District
1,267
3
4.54%
Cohn Inc.
964
4
3.46%
Pomerado Hospital
738
5
2.65%
Core Logic Credco
498
6
1.78%
Sysco Food Services of SD
475
7
1.70%
Walmart
300
8
1.08%
Mitchell Repair Information Co.
268
9
0.96%
Costco
266
10
0.95%
HNR Framing
Delta Design, Inc.
Disguise, Inc
COT-O -Van
Digirad Corporation
Total 9,057
Total City Labor Force 27,900
Source:
City of Poway Economic Development Division -by employer
State of California Employment Development Department -total employment
Note:
Information on Principal Employers from nine years back is not available so
information from the year 2006 will be used for the comparison until 2016.
162
32.46%
2006
Percent of
Number of Total
Employees Rank Employment
1,800
1
6.57%
758
5
2.77%
750
6
2.74%
935
4
3.41%
500
8
1.82%
0.00%
1,200
2
4.38%
1,000
3
3.65%
600
7
2.19%
400
9
1.46%
375
10
1.37%
6,518 23.79%
27,400
City of Poway
Full- time - Equivalent City Employees by Function
Last Seven Fiscal Years
'
Function 2011 2010 2009 2008 2007
2006
2005
2004
General government 33.00 40.00 35.00 37.00 38.00
38.00
40.00
40.00
'
Public Safety (a) 54.00 54.00 57.00 57.00 57.00
57.00
58.00
56.00
'
Public works 84.00 83.00 92.00 92.00 90.00
90.00
84.00
80.00
Redevelopment Services 9.00 9.00 9.00 9.00 10.00
10.00
11.00
11.00
'
Community Services 20.00 20.00 27.00 28.00 29.00
28.00
28.00
27.00
'
Development Services 29.00 29.00 37.00 36.00 37.00
37.00
36.00
35.00
229.00 235.00 257.00 259.00 261.00
260.00
257.00
249.00
'
Notes:
Amounts shown are the number of positions approved in each operating budget for the fiscal year.
'
(a) Law enforcement services are provided through contract with the County of San Diego Sheriff.
The City is reporting its ten year history starting with the implentation of GASB 44 in fiscal year 2006,
and in this instance was able to add an additional two years.
'
Source: City Poway Human
of Resources Division
163
City of Poway
Operating Indicators
Current and Prior Five Years
Function
2011
2010
2009
2008
2007
2006
General government:
Business registrations issued
1,192
942
1,240
1,071
792
Vendor payments processed
7,063
7,804
8,936
10,230
10,562
10,782
Public Safety:
Arrests made
1,145
1,334
1,015
1,052
981
1,898
Fire emergency responses
3,811
3,691
3,711
3,907
3,460
3,602
Safety Inspections
2,863
1,606
2,104
4,827
4,024
3,196
Development Services:
Building permits issued (1)
1,176
1,144
1,157
1,441
2,740
3,048
Building inspections
6,126
6,580
7,417
9,280
11,264
11,163
Culture and recreation:
Performing arts center attendance
53,249
61,214
68,993
74,420
64,728
67,004
Library-number of volumes in collection
104,367
125,977
124,977
124,977
124,977
120,628
Library-number of volumes borrowed
765,704
638,494
562,865
545,279
492,501
390,974
Athletic field permts issued
152
148
144
140
124
214
Highways and streets:
Roads resurfaced in square feet
207,968
290,877
600,000
600,000
200,000
16,000
Roads slung sealed in square feet
4,563,496
4,369,503
4,980,000
5,000,000
5,000,000
5,000,000
Pot holes repaired/ work orders (2)
571
193
147
46
36
35
Water:
Residential water customers
12,439
12,492
12,458
12,588
12,556
12,530
Commercial water customers
496
514
514
510
514
511
Average daily consumption (million /gallons)
8.99
9.57
11.61
12.82
13.83
13.37
Sewer:
Residential sewer customers
11,241
11,225
11,191
11,175
11,180
11,322
Commercial sewer customers
770
774
770
771
755
532
Average daily treatment (million /gallons)
3.27
3.15
3.43
3.24
3.25
3.42
Source:
City of Poway Operating Departments
The City is reporting its ten year history starting with the implentation of GASB 44 in
fiscal year 2006.
(1) In Fiscal Year 2007 -08 the Development Services Department changed the method used to
count the number of permits issued which led to the large decrease from the previous year.
(2) In Fiscal Year 2008 -09 the Public Works Department began reporting pot holes fixed rather than
pot holes work orders.
164
City of Poway
Capital Assets Statistics
Current and Prior Five Years
'
Function
2011
2010
2009
2008
2007
2006
Public Safety:
Number of fire stations
3
3
3
3
3
3
'
Number of sheriff stations
1
1
1
1
1
1
Public works:
'
Total number of streetlights
3,073
3,045
3,045
3,026
2,889
2,874
Signal controlled intersections
55
55
55
55
55
53
Health and welfare
'
Senior center facilities
1
1
1
1
1
1
Culture and recreation
'
Number of Libraries
1
1
1
1
1
1
Number of Performing Arts Centers
1
1
1
1
1
1
tAcres
Number of Parks
of developed parks
19
568
18
568
18
568
18
568
18
568
18
568
Number of reserves/ preserves
2
2
2
2
2
2
Acres of reserves /preserves
2,400
2,400
2,400
2,400
2,400
2,400
'
Miles of trails
82
82
82
82
82
82
Highways and streets
'
Miles of roadway
152
152
152
152
152
Water
Miles of water lines
289
253
253
253
253
253
'
Water storage capacity (billon /gallons)
1.11
1.11
1.11
1.11
1.11
1.11
'
Sewer
Miles of sewer lines
186
175
175
175
175
175
Miles of storm sewers
64
64
64
64
64
64
'
Source:
City of Poway Operating Departments
'
The City is reporting its ten year history starting with the implentation of GASB 44
in fiscal year 2006.
'
165