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1997-1998 Financial Audit ReportsAgenda Item No: _7 ___ _ Meeting Date: February 1, 1999 SAN RAFAEL CITY COUNCIL AGENDA REPORT Department: ADMINISTRATIVE SERVICEW 0~ Prepared by: Cmdy Mosser for Ken Nordhoff, City Manager Approval: Assistant Ci Mana er SUBJECT: 1997-98 FINANCIAL AUDIT; 1997-98 SINGLE AUDIT ACT REPORT; GANN APPROPRIATION LIMIT REPORT; AND THE MANAGEMENT LETTER. RECOMMENDATION: ACCEPT THE 1997-98 FINANCIAL AUDIT; ACCEPT THE 1997-98 SINGLE AUDIT ACT REPORT; ACCEPT THE GANN APPROPRIATION LIMIT REPORT; AND ACCEPT THE MANAGEMENT LETTER. BACKGROUND: As is required by both local code and State law, the City of San Rafael must complete an annual audit of its financial activities. The auditing firm of e.G. Uhlenberg & Company conducted the audit for the 1997-98 fiscal year. Their work was completed in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General of the United States; and the provisions of Office of Management and Budget Circular A-133, Audits of State and Local Government and Non-Profit Organizations. A Comprehensive Annual Financial Report (CAFR) was submitted this year to the State and National Finance Officers organizations for award consideration. The CAFR was delivered to City Council in December oflast year. Over the years, the City has been the beneficiary of various grants to conduct a number of programs. The Federal Government requires that any local agency receiving grant funds, either directly or indirectly, subject these programs to a more comprehensive review. This review is known as the Single Audit Act. As part of the Single Audit Act, the auditors report on the City's internal controls and compliance with laws and regulations. A management letter is prepared by the auditors to help identify areas that could help improve the City's organization and controls over financial activities. Also, the requirements of Section 1.5 of Article XIIIB of the California Constitution is met with an agreed upon procedure report applied to the Gann Appropriation Limit calculated for the 1997-98 year. I J FOR CITY CLERK ONLY File No.: 8-1)(. '8 -9 Council Meeting: 1,(9<[ I Disposition: ®..c<~;t£d ~.(~~~ ~ ) F ~~o:t:. SAN RAFAEL CITY COUNCIL AGENDA REPORT 1 Pa2e: 2 1 The City Council's approval and acceptance of the 1997-98 audits and management letter are needed to remain in compliance with local charter and State law. ANALYSIS: The actual results of the City's financial activities are presented in the General Purpose Financial Statements. A comprehensive analysis of the 1997-98 year is shown in the introductory section of the CAFR. General Fund taxes and assessments, totaling $25,069,298, exceeded prior years totals by $2,885,804. Tax revenues outpaced both prior year perfonnance and budget expectations. Sales tax and franchise tax were major factors to the increase in revenues. Sales tax increased due to the opening of Home Depot, increased automobile sales, and the revitalization of downtown. Franchise tax increased due to the implementation of a franchise fee on the local waste carrier, Marin Sanitary Service. On the expenditure side, the General Fund total was $148,280 over budget due to an non-departmental transfer for the Bellam claim. The Governmental Accounting Standards Board Statement No. 31 requires investments to be stated at fair market value. To be in compliance, the City restated the beginning fund balances of the General Fund, Special Revenue Fund and Capital Project Fund. All ending fund balances, which are the equity of a fund, have a positive balance. As required under the Single Audit Act, a number of separate reports are contained within this document. Most of these reports comment on either compliance with Federal assistance regulations or recommendations regarding the City's accounting practices. With respect to compliance, the auditors have found no material instances of noncompliance with laws, regulations, contracts or grants applicable to our programs. There were no current findings or recommendations. The Agreed-Upon Procedures report for the Gann Appropriations Limit required four steps to be perfonned including testing the accuracy of the calculations and comparison of infonnation presented. No exceptions were noted in all four steps. In the area of accounting practices and internal controls, a few issues have been raised. The first issue concerned the Federal Emergency Management Administration grant. A reimbursement claim inadvertently included $5,900 of straight time wages. This amount did not exceed the materiality factor for a finding in the Single Audit, but it warns us to scrutinize the expenditures closely. From the prior year, the issues of a lack of written policies and procedures for the fixed assets and coding errors in the Child Development Program were noted again. The issues reported are not critical problems and they are being addressed in this coming year. FISCAL IMPACT: No fiscal impact occurs by having the Council accept these reports. The 1997/98 General Purpose Financial Statements are presented as the actual results of the City and Agency financial activities for the year. The 1997/98 Single Audit Act Report is intended to identify compliance with Federal laws and regUlations. The Gann Appropriation Limit Agreed-Upon Procedure Report is intended to identify compliance with State laws. No budget adjustments are necessary. SAN RAFAEL CITY COUNCIL AGENDA REPORT I Pa2c: 3 , OPTIONS: The City Council can choose to either: 1) Accept the 1997-98 Financial Audit; 1997-98 Single Audit Act Report; Gann Appropriation Limit Report and Management Letter as presented, or 2) Reject the reports. The Council is required under current law to accept the reports and file it with numerous County, State and Federal agencies. Rejecting these reports would leave the City out of compliance with applicable laws. ACTION REQUIRED: Staff recommends Council accept the reports as presented. ATTACHMENTS agenda reports/1999/9798auditmgrntltretc.doc ( c. G. UHLE NB ERG & co. LLP CERTIFIED PUBLIC ACCOUNTANTS ROBERT E. BARSANTI, C.P.A . PEGGY H. CHEN, C.P.A. JEFFREY J. IRA, C.P.A. KATHERINE C. WONG , C.P.A October 31, 1998 Rod Gould, City Manager City of San Rafael 1400 Fifth Avenue San Rafael, California 94901 Dear Mr. Gould: We would like to express our appreciation to your staff for their cooperation and assistance during the course of our engagement. During that time we discussed various aspects of operations and internal controls with your staff. We were extremely pleased with the eagerness of the City's staff to discuss and correct any potential problems. We look forward to working together with the City in the years to come. In planning and performing our audit of the general purpose financial statements for the fiscal year ended June 30, 1998, we considered its internal control structure in order to determine our auditing procedures for the purpose of expressing an opinion on the general purpose financial statements and not to provide assurance on the internal control structure. Our consideration of the internal control structure would not necessarily disclose all matters that might be material weaknesses under standards established by the American Institute of Certified Public Accountants. A description of the responsibility of the management for establishing and maintaining the internal control structure, and of the objective of inherent limitations in such a structure, is set forth in the attached Appendix, and should be read in conjunction with this report. A material weakness is a condition in which the design or operation of the specific internal control structure elements does not reduce to a relatively low level the risk that errors or irregularities in amounts that would be material, in relation to the general purpose financial statements being audited, may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control structure and its operations that we consider to be material weaknesses as defined above. The following comments present our findings with suggested solutions for your consideration and possible implementation. 647 Veterans Boulevard, Redwood City, CA 94063 Phone (650) 365-2323 • (408) 733-9944 • (510) 353-0330 Fax (650) 365-8394 ( ( While conducting the audit, we discussed various aspects of operations and internal controls with management. We feel very positive about the improvements that have been implemented in the past year, especially in light of the budget constraints facing the City. This letter is intended solely for the information and use of management and the City Council and should not be used for any other purpose. This restriction is not intended to limit distribution of this letter which is a matter of public record. We would be pleased to discuss these matters in greater detail at your convenience. Again, we would like to express our appreciation for the courtesy and assistance extended to us during the conduct of our audit by the staff of the City. Very truly yours, C. G. UHLENBERG & CO. LLP By Enc!. cc: Ken Nordhoff, Assistant City Manager 2 I L~.t·Y OF SAN RAFAEL, CALIFORNln CURRENT YEAR FINDINGS AND RECOMMENDATIONS FEDERAL COMPLIANCE Finding -During the perfonnance of the Single Audit procedures on the Federal Emergency Management Administration (FEMA) grant, we noted a claim was filed for reimbursement of unallowable costs. A claim for reimbursement ofFEMA funds included $5,900 of wages paid to police officers for straight time. The grant requirement states that straight time can only be claimed when pennanent restoration is perfonned or when an agreement exists that allows otherwise. The police department activities did not involve restoration nor an agreement exists that allows activities outside of restoration. Recommendation -Although the amount claimed were not material enough to be considered a questioned cost for Single Audit purpose, we do recommend that the City follow the Federal grant requirements closely in the future so that no unallowable costs are claimed. MAJOR BREAKTHROUGH IN REPORTING MODEL A major breakthrough was made by the Governmental Accounting Standards Board (GASB), at its July, 1998, meeting. The board tentatively agreed to a new reporting model. Full details of the model as well as the appropriate level of detail and location of the infonnation will be discussed at a future meeting. The board is also considering modifying the rules of liability and expenditure recognition in governmental funds as part of the final statement. The board has scheduled public hearings over the next few months to discuss these issues. We will continue to keep you updated on the board's progress and of course we are available to answer any questions regarding this comprehensive and momentous statement. Although this change does not effect the City directly it will impact the infonnation and accounting of many entities that are integral to your operations. INTERNAL CONTROLS As a result of new disclosure requirements (SAS 82), we need to remind management of their responsibility to maintain adequate internal controls. Even with strong internal control procedures in place, employees can learn to manipulate the accounting system to their benefit. However, a properly executed system of internal controls can help you reduce these risks. YEAR 2000 COMPLIANCE (y2K) The City is currently in the process of taking the necessary steps to address the Y2K issue. The Governmental Accounting Standards Board (GASB) has responded to the Y2K concerns and has recently proposed Technical Bulletin 98 -A. We fully anticipate that this bulletin will be adopted. This will affect all financial statements issued after October 31, 1998. 3 L~iY OF SAN RAFAEL, CALIFORNln. CURRENT YEAR FINDINGS AND RECOMMENDATIONS The Bulletin is focusing on the disclosures required for an entity compliance with the year 2000 (Y2K). The primary disclosures that need to be presented in the fmancial statements are as follows: 1. In accordance with NCGA Statement 1, paragraph 158, and NCGA Interpretation 6, paragraphs 5 and 6, notes to the financial statements should disclose material items whose omission would cause the financial statements to be misleading. Furthermore, in accordance with NCGA Interpretation 6, paragraph 4, entities are required to disclose significant commitments in the notes to the financial statements. 2 . The year 2000 problem affects many of the computer systems and other equipment necessary for the continued and uninterrupted operations of a government. A significant commitment of resources may be required to make year 2000 compliance changes or updates to computer systems and other equipment. Omitting information about this commitment could cause the fmancial statements to be misleading. 3. Governments should disclose a general description of the year 2000 issue as it relates to their organization. Governments should also disclose the amount spent or payable during the period covered by the financial statements and the amount of resources committed but not yet spent or payable to make computer systems and the other equipment year 2000 - compliant. 4. If software systems or other equipment is replaced or updated and therefore results in year 2000 compliance cannot be determined, the total amount spent or payable for the period on updating software, systems, and other equipment should be disclosed. The disclosure should include whether the replaced or updated system or equipment is year 2000 -compliant. 5. Government should also disclose information about the stages of work needed to make the systems and other equipment year 2000-compliant. This disclosure should include a description of the stages of work completed and the stages of work that need to be completed to make systems and other equipment critical to continued operations year 2000-compliant. The following stages have been identified as necessary to implement a year 2000-compliant system: Awareness Stage -Encompasses establishing a budget and project plan (for example, a timeline or chart noting major tasks and due dates) for dealing with the year 2000 issue. Assessment Stage -When the organization begins the actual process of identifying all of its systems (preparing an inventory) and individual components of the systems. An organization may decide to review all system components for year 2000 compliance or, through a risk analysis, identify only mission-critical systems to check for compliance. 4 ( \ l, .. fV OF SAN RAFAEL, CALIFORNIA CURRENT YEAR FINDINGS AND RECOMMENDATIONS Remediation Stage -When the organization actually makes changes to systems. This stage deals primarily with the technical issues of converting existing systems, or switching to compliant systems. During this stage, decisions are made on how to make the systems or processes year 2000-compliant, and the required system changes are made. Validation/Testing Stage -When the organization determines that no errors were introduced during the conversion process. The development of test data and test scripts, the running of test scripts, and the review of test results are crucial for this stage of the conversion process to be successful. If the testing results show anomalies, the tested area needs to be corrected and retested. Implementation Stage -When a tested year 2000-compliant system is ready for use. These disclosures will be required in your financial statements for the fiscal year ended June 30, 1999 . We recommend that you continue to take the necessary actions to immediately begin to identify, modify, and test all systems that may be negatively affected by the Y2K issue, particularly mission-critical systems. This program should be monitored closely to ensure completion before mission-critical systems begin to fail. Such failures may be evident before January 1, 2000. Depending on the extent of system failures, noncompliance could have catastrophic consequences for the City. Also, the City should implement additional verification procedures to test the accuracy of information received from its vendors, service providers, bankers, customers, and other third- party organizations with whom it exchanges date -dependent information, because these organizations also must become Y2K compliant. The City also should satisfy itself that vendors, service providers, bankers, customers, and other third -party organizations will not experience problems relating to the Y2K issue that could affect the City's operations or cash flows. In addition, the accounting personnel were extremely competent and professional, which made for a very organized and enjoyable audit. 5 (,~ fY OF SAN RAFAEL, CALIFORNIA STATUS OF PRIOR YEAR'S FINDINGS AND RECOMMENDATIONS PETTY CASH Finding -During our review of the City's petty cash, we noted that petty cash funds are not restricted as to maximum amount of disbursements in anyone year. Recommendation -We recommend that the City establish an annual limit on the amount of disbursement from petty cash funds as a control to prevent the circumvention of the purchasing function. Status -Implemented. FIXED ASSETS Finding -The City does not have a written policies manual with established procedures for differentiating between capitalizable additions and replacement and maintenance expenditures. A procedures manual should be in place to guide and assist in the area of maintaining fixed assets and determining depreciation on fixed assets. Recommendation -We recommend that the City establish a written procedures manual as a guide and to assist in the area of maintaining fixed assets. Status -Not implemented; repeat recommendation. CHILD DEVELOPMENT PROGRAM Finding -During our review of the attendance related to the Child Development Program, we noted three instances where the enrollment days were miscalculated. The net effect on the Child Days of Enrollment reported to the California Department of Education is two (2) days less than the actual days of enrollment. Recommendation -We recommend that the enrollment days be calculated carefully and reviewed properly. Status -Implemented. Finding -During our review of the Child Development Program grant revenues, we noted that revenues for the Before and After School Program and the One-Time-Only Instructional Material Grant were recorded in the Latchkey and Preschool Funds. Adjustments were required to allocate the grant revenues to the appropriate funds. Recommendation -We recommend that cash receipts for grant revenues be coded correctly and distributed to the appropriate funds. Status -Not implemented; repeat recommendation. 6 Co. iV OF SAN RAFAEL, CALIFORNlrt STATUS OF PRIOR YEAR'S FINDINGS AND RECOMMENDATIONS ACCOUNTING POLICIES AND PROCEDURES MANUAL Finding -The City does not have an accounting manual which outlines the current accounting policies and procedures. Lack of such a manual can result in inconsistent treatment of accounting transactions, increased supervisor time responding to staff inquiries and difficult transition periods in the event of personnel turnover. Additionally, it is more difficult to assure compliance with legal and other requirements. Recommendation - A comprehensive accounting policies and procedures manual should be prepared which would include, but not be limited to: • Descriptions of the functions of each job within the Finance Department. • The nature and source of entries to each general ledger account. • Descriptions of standard, recurring and closing journal entries, especially for complicated transactions. • Approved procedures for journal entries and invoices . • Monthly and annual closing procedures. • Financial reporting, including compliance requirements. The City acknowledges that there is a need to have a policy and procedures manual. However, this is something that the City is going to work on as time permits. Status -The City is in the process of preparing an accounting policies and procedures manual. 7 ( MANAGEMENT'S RESPONSIBILITY FOR, AND THE OBJECTIVES AND LIMITATIONS, OF THE INTERNAL CONTROL STRUCTURE APPENDIX The following comments concerning management's responsibility for the internal control structure and the objectives of, and the inherent limitations in, the internal control structure are adapted from the Statements on Auditing Standards of the American Institute of Certified Public Accountants. Management's Responsibility Management is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of the internal control structure policies and procedures. Objectives The objectives of an internal control structure are to provide management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, and that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of general purpose financial statements in accordance with generally accepted accounting principles. Limitations Because of inherent limitations in any internal control structure, errors or irregularities nevertheless may occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. 8 ( c. G. UHLEN BERG & co. LLP CERTIFIED PUBLIC ACCOUNTANTS ROBERT E. BARSANTI. C.P.A. PEGGY H. CHEN , C.P.A. JEFFREY J. IRA , C.P.A. KATHERINE C. WONG , C.P.A City Council City of San Rafael, California Independent Accountant's Report on Agreed-Upon Procedures Applied to Appropriations Limit Worksheets We have applied the procedures enumerated below to the accompanying Appropriations Limit worksheet No.6 of the City of San Rafael, California for the year ended June 30, 1998. These procedures, which were agreed to be the City of San Rafael, California and the League of California Cities (as presented in the League publication entitled Article XIIIB Appropriations Limitation Uniform Guidelines) were performed solely to assist the City of San Rafael, California in meeting the requirements of Section 1.5 of Article XIIIB of the California Constitution. This engagement to apply agreed-upon procedures was performed in accordance with standards established by the American Institute of Certified Public Accountants. The sufficiency of the procedures is solely the responsibility of the specified users of the report. Consequently, we make no representation regarding the sufficiency of the procedures described below either for the purpose for which this report has been requested or for any other purpose. The procedures performed and our findings were as follows: 1. We obtained the completed worksheets No.1 through 7 and compared the limit and annual adjustments factors included in those worksheets to the limit and annual adjustment factors that were adopted by resolution of the City Council. We also compared the population and inflation options included in the aforementioned worksheets to those that were selected by a recorded vote of the City Council. Finding: No exceptions were noted as a result of our procedures. 2. For the accompanying Appropriations Limit worksheet No.6, we added line A, last year's limit, to line E, total adjustments, and compared the resulting amount to line F, this year's amount. Finding: No exceptions were noted as a result of our procedures. 647 Veterans Boulevard, Redwood City, CA 94063 Phone (650) 365-2323 • (408) 733-9944 • (510) 353-0330 Fax (650) 365-8394 ( 3. We compared the current year information presented in the accompanying Appropriations Limit worksheet No.6 to the other worksheets described in No.1 above. Finding: No exceptions were noted as a result of our procedures. 4. We compared the prior year appropriations limit presented in the accompanying Appropriations Limit worksheet No. 6 to the prior year appropriations limit adopted by the City Council for the prior year. Finding: No exceptions were noted as a result of our procedures. We were not engaged to, and did not, perform an audit, the objective of which would be the expression of an opinion on the accompanying Appropriations Limit worksheet No.6. Accordingly, we do not express such an opinion. Had we performed additional procedures, other matters might have come to our attention that would have been reported to you. No procedures have been performed with respect to the determination of the appropriations limit for the base year, as defined by the League publication entitled Article XIIIB Appropriations Limitation Uniform Guidelines. This report is intended solely for the use of the City of San Rafael, California and should not be used by those who have not agreed to the procedures and taken responsibility for the sufficiency of the procedures for their purposes. However, this report is a matter of public record and its distribution in not limited. C. 6. ~ ~ &. U(J Octoberber 23, 1998 Redwood City, California ( ( CITY OF SAN RAFAEL GANN APPROPRIA nONS LIMIT A nON COMPUTA nON YEAR ENDED JUNE 30, 1998 A. LAST YEAR'S LIMIT (AS AMENDED) (A) $ 27,941,557 B. ADJUSTMENT FACTORS: l. Population 1.0217% 2. Change in Assessment Roll for Nonresidential Construction 1.0540% Total Adjustment Factor (B) 1.0768% C. ANNUAL ADJUSTMENT 2,235,325 D . OTHER ADJUSTMENTS: Lost responsibility Transfer to private Transfer to fees Asswned responsibility Subtotal E. TOTAL ADJUSTMENTS (E) 2,235,325 F. THIS YEAR'S LIMIT (A+E) $ 30,176,882 ( L ( CITY OF SAN RAFAEL. CALIFORNIA GENERAL PURPOSE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30,1998 * * * l r ~rY OF SAN RAFAEL, CALIFOR1L.~ GENERAL PURPOSE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 1998 TABLE OF CONTENTS (Concluded) Independent Auditor's Report .................................................................................... . General Purpose Financial Statements: Combined Balance Sheet -All Fund Types and Account Groups and Discretely Presented Component Units ........................................................ .. Combined Statement of Revenues, Expenditures and Changes in Fund Balances -All Governmental Fund Types and Expendable Trust Funds .............................................................. . Combined Statement of Revenues, Expenditures and Changes in Fund Balances -Budget and Actual (Budget Basis) -General, Special Revenue and Debt Service Funds ..................................................... .. Combined Statement of Revenues, Expenses and Changes in Fund Equity -Proprietary Fund Type and Discretely Presented Component Unit ........................................................... . Combined Statement of Cash Flows -Proprietary Fund Type and Discretely Presented Component Unit.. ........................................................ .. Notes To General Purpose Financial Statements ...................................................... .. Supplementary Information: Special Revenue Funds: PAGE NO. 1 2-5 6-7 8-9 10 11 12 -44 Combining Balance Sheet....... ......... ............. ......... .......... .... .............. ............. 45 -48 Combining Statement of Revenues, Expenditures and Changes in Fund Balances........................................................................ 49 -52 Recreation Revolving Fund -Statement of Revenues, Expenditures and Changes in Fund Balances -Budget (GAAP Basis) and Actual....... 53 Baypoint Lagoons Assessment District Fund -Statement of Revenues, Expenditures and Changes in Fund Balances - Budget (GAAP Basis) and Actual ........................................................... 54 Parking Services Fund -Statement of Revenues, Expenditures and Changes in Fund Balances -Budget (GAAP Basis) and Actual ....... 55 Gas Tax Fund -Statement of Revenues, Expenditures and Changes in Fund Balances -Budget (GAAP Basis) and Actual............................ 56 Childcare Fund -Statement of Revenues, Expenditures and Changes in Fund Balances -Budget (GAAP Basis) and Actual.............. 57 Equipment Replacement Fund -Statement of Revenues, Expenditures and Changes in Fund Balances -Budget (GAAP Basis) and Actual....... 58 Street Maintenance & Cleaning Fund -Statement of Revenues, Expenditures and Changes in Fund Balances -Budget (GAAP Basis) and Actual........... ..... ........ ....... .............. .... .... .............. ........ ......... ... ......... 59 l _ fY OF SAN RAFAEL. CALIFORN.I. ... GENERAL PURPOSE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 1998 TABLE OF CONTENTS (Concluded) Sewer Maintenance Fund -Statement of Revenues, Expenditures and Changes in Fund Balances -Budget (GAAP Basis) PAGE NO. and Actual...... ...... ..... ........ ........ ........... ........................ ........ ...... .............. 60 Household Hazmat Facility Fund -Statement of Revenues, Expenditures and Changes in Fund Balances -Budget (GAAP Basis) and Actual ...... . 61 Loch Lomond Assessment District Fund -Statement of Revenues, Expenditures and Changes in Fund Balances -Budget (GAAP Basis) andActual ............................................................................................... . 62 Library Fund -Statement of Revenues, Expenditures and Changes in Fund Balances -Budget (GAAP Basis) and Actual............................ 63 Public Safety Fund -Statement of Revenues, Expenditures and Changes in Fund Balances -Budget (GAAP Basis) and Actual.............. 64 Stormwater Fund -Statement of Revenues, Expenditures and Changes in Fund Balances -Budget (GAAP Basis) and Actual.............. 65 Traffic and Housing Mitigation Fund -Statement of Revenues, Expenditures and Changes in Fund Balances -Budget (GAAP Basis) and Actual ........................ .......... ................................. ................. ... ...... ... 66 Development Services Fund -Statement of Revenues, Expenditures and Changes in Fund Balances -Budget (GAAP Basis) and Actual ....... 67 Grants Fund -Statement of Revenues, Expenditures and Changes in Fund Balances -Budget (GAAP Basis) and Actual............................ 68 Parkland Dedication Fund -Statement of Revenues, Expenditures and Changes in Fund Balances -Budget (GAAP Basis) and Actual .............. 69 Debt Service Funds: Combining Balance Sheet............................................................................... 70 -71 Combining Statement of Revenues, Expenditures and Changes in Fund Balances .. ...... ............. ......... ............ ... ...... ... ..... ... ..... ..... 72 -73 Peacock Gap Assessment District Fund -Statement of Revenues, Expenditures and Changes in Fund Balances -Budget (GAAP Basis) and Actual .......... ......... .... ...... ................ ..... .... ............... ...... .... .... ........ ..... 74 1915 Act Bonds Fund -Statement of Revenues, Expenditures and Changes in Fund Balances -Budget (GAAP Basis) and Actual.............. 75 Mariposa Assessment District Fund -Statement of Revenues, Expenditures and Changes in Fund Balances -Budget (GAAP Basis) and Actual ................................................................................................ 76 1997 Financing Authority Revenue Bonds Fund -Statement of Revenues, Expenditures and Changes in Fund Balances -Budget (GAAP Basis) and Actual ............ .... ... ......... ............. .................. ............................. ........ 77 [ [ ( .TY OF SAN RAFAEL, CALIFORN. . GENERAL PURPOSE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED JUNE 30, 1998 TABLE OF CONTENTS (Concluded) 1992 Agency Refunding Bonds Fund -Statement of Revenues, Expenditures and Changes in Fund Balances -Budget (GAAP Basis) and Actual ............................................................................................... . 1995 Agency Refunding Bonds Fund -Statement of Revenues, Expenditures and Changes in Fund Balances -Budget (Cash Basis) and Actual ............................................................................................... . Capital Projects Funds: Combining Balance Sheet .............................................................................. . Combining Statement of Revenues, Expenditures and Changes in Fund Balances ................................................................ . Internal Service Funds: Combining Balance Sheet .............................................................................. . Combining Statement of Revenues, Expenditures and Changes in Retained Earnings .......................................................... . Combining Statement of Cash Flows ............................................................ . Trust and Agency Funds: Combining Balance Sheet .............................................................................. . Expendable Trust Funds -Combining Statement of Revenues, Expenditures and Changes in Fund Balances ......................................... . Statement of Changes in Assets and Liabilities -Agency Fund .................... . PAGE NO. 78 79 80 -81 82 -83 84 85 86 87 -88 89 -90 91 ) ) :qg C. G. UHLENBERG & CO. LLP CERTIFIED PUBLIC ACCOUNTANTS ROBERT E. BARSANTI. C.P.A. PEGGY H. CHEN. C.P.A. JEFFREY J. IRA . C.P.A . KATHERINE C. WONG, C.P.A. 1 j 1 J \ j J INDEPENDENT AUDITOR'S REPORT Honorable Mayor and Members of the City Council of the City of San Rafael San Rafael, California We have audited the accompanying general purpose financial statements of the City of San Rafael, California (the City), as of and for the fiscal year ended June 30, 1998, as listed in the foregoing table of contents. These general purpose financial statements are the responsibility of the City's management. Our responsibility is to express an opinion on these general purpose financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General of the United States; and the provisions of Office of Management and Budget Circular A-133, Audits of State and Local Governments and Non-Profit Organizations. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the general purpose financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the general purpose financial statements referred to above present fairly, in all material respects, the fmancial position of the City of San Rafael, California, at June 30, 1998, and the results of its operations and the cash flows of its proprietary fund types for the fiscal year then ended in conformity with generally accepted accounting principles. In accordance with Government Auditing Standards, we have also issued a report dated October 23, 1998 on our consideration of the City of San Rafael's internal control structure and a report on October 23, 1998 on its compliance with laws and regulations. Our audit was made for the purpose of forming an opinion on the general purpose financial statements taken as a whole . The accompanying combining and individual fund and account group statements and schedules listed in the table of contents under "Supplementary Information" are presented for purposes of additional analysis and are a required part of the general purpose fmancial statements of the City of San Rafael. Such information has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion, is fairly presented in all material respects in relation to the general purpose financial statements taken as a whole . The financial information listed in the accompanying table of contents under "Statistical Section" is presented for purposes of additional analysis and is not a required part of the general purpose financial statements of the City. Such information has not been SUbjected to the auditing procedures applied in the audit of the general purpose financial statements, and, accordingly, we express no opinion on such information. (!. G-. ~ ~ &. ~ October 23, 1998 Redwood City, California 647 Veterans Boulevard, Redwood City, CA 94063 Phone (650) 365-2323 • (408) 733-9944 • (510) 353-0330 P:lY ((;<;0) ~(;<;_R~q4. CITY OF SAN RAFAEL. CALIFORNIA COMBINED BALANCE SHEET -ALL FUND TYPES AND ACCOUNT GROUPS AND DISCRETELY PRESENTED COMPONENT UNITS JUNE 30, 1998 PROPRIETARY GOVERNMENTAL FUND TYPES FUND TYPES SPECIAL DEBT CAPITAL INTERNAL GENERAL REVENUE SERVICE PROJECTS SERVICE ASSETS AND OTHER DEBITS Assets: Cash and investments (Note 2) $4,975,183 $16,479,887 $1,183,603 $ 7,373,715 $ 2,182,998 Cash with fiscal agent (Note 2) 1,043,908 Restricted cash Accounts receivable 750,002 743,094 1,146,758 Taxes receivable (Note 3) 2,708,051 439,444 Grants receivable 9,782 Interest receivable 406,282 74,434 Assessment receivable 1,002,967 Loans receivable (Note 7) 776,004 100,000 343,659 Due from other funds (Note 8) 64,654 1,703,482 Prepaid expenses Land held for resale 2,004,514 Other current assets General flXed assets (Note 4) Component unit fixed assets -net COP issuance costs -net Other Debits: Amount available in debt service funds Amount to be provided for retirement of: General long-term debt Vacation and sick leave obligations TOTAL ASSETS AND OTHER DEBITS S9.615.522 S 17.397,417 S3.230.478 S 13.086.006 S2.182.998 See accompanying notes to general purpose financial statements. 2 ) ) FIDUCIARY PRIMARY REPORTING FUND TYPES ACCOUNT GROUPS GOVERNMENT ENTITY EXPENDABLE GENERAL GENERAL TOTALS TOTALS TRUST AND FIXED LONG-(MEMORANDUM COMPONENT (MEMORANDUM AGENCY ASSETS TERM DEBT ONLY) UNIT ONLY) $ 427,533 $ $ $ 32,622,919 $ 760,557 $ 33,383,476 1,043,908 1,043,908 1 11,496,347 11,496,347 413,517 11,909,864 2,639,854 2,639,854 J 3,147,495 3,147,495 9,782 9,782 480,716 1,673 482,389 1,002,967 1,002,967 1,219,663 1,219,663 1,768,136 1,768,136 12,818 12,818 2,004,514 2,004,514 3,190 3,190 36,347,650 36,347,650 36,347,650 23,088,862 23,088,862 52,550 52,550 J 2,227,511 2,227,511 2,227,511 J 29,252,922 29,252,922 29,252,922 2,646,535 2,646,535 2,646,535 ~ 11,923,880 ~ 36,347,650 $ 34,126,968 $ 127,910,919 $ 24,333,167 $ 152,244,086 OJ (Continued) 3 CITY OF SAN RAFAEL, CALIFORNIA COMBINED BALANCE SHEET -ALL FUND TYPES AND ACCOUNT GROUPS AND DISCRETELY PRESENTED COMPONENT UNIT JUNE 30, 1998 PROPRIETARY GOVERNMENTAL FUND TYPES FUND TYPES SPECIAL DEBT CAPITAL INTERNAL GENERAL REVENUE SERVICE PROJECTS SERVICE LIABILITIES AND FUND EQUITY Liabilities: Accounts payable $1,061,640 $ 359,562 $ $ 1,024,522 $ 13,624 Connection fees payable Developer bonds payable 1,891,635 Insurance claims payable 1,908,741 Interest payable Due to other funds (Note 8) 7,654 1,760,482 Deferred compensation payable Deposits 100,000 Deferred revenue 157,930 1,002,967 70,020 Capital leases (Note 6) Compensated absences (Note 5) Certificates of participation Notes payable (Note 5) Special assessment debt (Note 5) Bonds payable (Note 5) Total Liabilities 2,953,275 525,146 1,002,967 2,955,024 1,922,365 Fund Equity and Other Credits: Investment in general fixed assets Contributed capital Retained earnings (Note 9): Reserved Unreserved: Undesignated 260,633 Total Retained Earnings 260,633 Fund Balances (Note 9): Reserved 3,543,117 1,549,940 2,213,810 6,454,780 Unreserved: Designated 12,024,219 13,701 4,866,003 Undesignated 3,119,130 3,298,112 (1,189,801) Total Fund Balances _6,662,247 16,872,271 2,227,511 10,130,982 Total Fund Equity and other credits 6,662,247 16,872,271 2,227,511 10,130,982 260,633 TOTAL LIABILITIES AND FUND EQUITY $9,615,522 $17,397,417 $3,230,478 $13,086,006 $ 2,182,998 See accompanying notes to general purpose financial statements. 4 ) ) FIDUCIARY PRIMARY REPORTING FUND TYPES ACCOUNT GROUPS GOVERNMENT ENTITY EXPENDABLE GENERAL GENERAL TOTALS TOTALS TRUST AND FIXED LONG-(MEMORANDUM COMPONENT (MEMORANDUM AGENCY ASSETS TERM DEBT ONLY) UNIT ONLY) $ $ $ $ 2,459,348 $ 78,060 $ 2,537,408 2,000 2,000 1,891,635 1,891,635 1,908,741 1,908,741 119,652 119,652 1,768,136 1,768,136 11,496,347 11,496,347 11,496,347 100,000 100,000 1,230,917 1,230,917 102,433 102,433 102,433 2,646,535 2,646,535 2,646,535 4,253,313 4,253,313 169,000 169,000 169,000 1,769,000 1,769,000 1,769,000 29,440,000 29,440,000 29,440,000 11,496,347 34,126,968 54,982,092 4,453,025 59,435,117 36,347,650 36,347,650 36,347,650 --8,034,558 8,034,558 --------- 95,297 95,297 260,633 11,750,287 12,010,920 260,633 11,845,584 12,106,217 3,000 13,764,647 13,7,152 424,533 17,306,951 17,306,951 5,227,441 5,227,441 427,533 36,320,544 36,320,544 72,928,827 19,880,142 92,808,969 $ 11,923,880 $ 36,347,650 $ 34,126,968 $ 127,910,919 $ 24,333,167 $ 152,244,086 (Concluded) 5 CITY OF SAN RAFAEL. CALIFORNIA COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES ALL GOVERNMENTAL FUND TYPES AND EXPENDABLE TRUST FUNDS FOR THE FISCAL YEAR ENDED JUNE 30, 1998 GOVERNMENTAL FUND TYPES SPECIAL DEBT GENERAL REVENUE SERVICE REVENUES: CAPITAL PROJECTS Taxes and special assessments $ 25,069,298 $ 86,895 $ 3,203,499 $ 474,158 Licenses and permits 681,470 148,582 Fines and forfeitures 734,027 2,115 Uses of money and property 521,899 836,884 39,995 587,388 Intergovernmental 4,440,101 2,145,535 4,638,245 Charges for current services 1,817,285 6,573,396 500 Other revenues 64,095 1,409,499 3,185,380 Total Revenues 33,328,175 11,202,906 3,243,494 8,885,671 EXPENDITURES: Current: General government 4,385,297 128,924 Public safety 18,115,295 1,479,852 Public works and parks 4,288,115 2,689,052 Community development 1,488,564 412,959 1,146,492 Culture and recreation 1,179,595 3,513,018 34,461 Capital Outlay 437,530 2,938,419 14,752,465 Debt Service: Principal retirement 801,000 Interest and fiscal charges 1,909,490 Total Expenditures 29,894,396 11,162,224 2,710,490 15,933,418 EXCESS (DEFICIENCy) OF REVENUES OVER (UNDER) EXPENDITURES 3,433,779 40,682 533,004 (7,047,747) OTHER FINANCING SOURCES (USES): Operating transfers -In 812,195 2,986,961 7,585 40,473 Operating transfers -Out (3,536,765) (498,361) (16,896) (7,692) Total Other Financing Sources (Uses) (2,724,570) 2,488,600 (9,311) 32,781 EXCESS (DEFICIENCy) OF REVENUES AND OTHER FINANCING SOURCES OVER (UNDER) EXPENDITURES AND OTHER FINANCING USES 709,209 2,529,282 523,693 (7,014,966) FUND BALANCES AT BEGINNING OF YEAR -RESTATED 5,953,038 14,342,989 1,703,818 17,145,948 FUND BALANCES AT END OF YEAR $ 6,662,247 $ 16,872,271 $ 2,227,511 $10,130,982 See accompanying notes to general purpose financial statements. 6 ] '1 1 J I , J 1 j FIDUCIARY FUND TYPES EXPENDABLE TRUST $ 21,548 35,000 16~771 73)19 66,352 31,572 97,924 (24,605) (24,605) 452,138 $ 427,533 ) PRIMARY GOVERNMENT TOTALS (MEMORANDUM ONLY} $ 28,833,850 830,052 736,142 2,007,714 11,258,881 8,391,181 4,675,745 56,733,565 4,514,221 19,595,147 6,977,167 3,114,367 4,758,646 18,128,414 801,000 1,909,490 59,798,452 (3,064,887) 3,847,214 (4,059,714) (212,500) (3,277,387) 39,597,931 $ 36,320,544 7 ) CITY OF SAN RAFAEL, CALIFORNIA COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES -BUDGET AND ACTUAL (BUDGET BASIS) GENERAL, SPECIAL REVENUE AND DEBT SERVICE FUNDS FOR THE FISCAL YEAR ENDED JUNE 30, 1998 GENERAL FUND VARIANCE FAVORABLE BUDGET ACTUAL (UNFAVORABLE) REVENUES: Taxes and special assessments $23,712,259 $25,069,298 $ 1,357,039 Licenses and penn its 547,987 681,470 133,483 Fines and forfeitures 670,070 734,027 63,957 Uses of money and property 393,025 521,899 128,874 Intergovernmental 3,735,272 4,440,101 704,829 Charges for current services 1,577,265 1,817,285 240,020 Other revenues 42,000 64,095 22,095 Total Revenues 30,677,878 33,328,175 2,650,297 EXPENDITURES: Current: General government 4,237,017 4,385,297 (148,280) Public safety 18,079,773 18,115,295 (35,522) Public works and parks 3,617,562 4,288,115 (670,553) Community development 1,743,427 1,488,564 254,863 Culture and recreation 1,244,309 1,179,595 64,714 Capital Outlay 694,699 437,530 257,169 Debt Service: Principal retirement Interest and fiscal charges Total Expenditures 29,616,787 29,894,396 (277,609) EXCESS (DEFICIENCy) OF REVENUES OVER (UNDER) EXPENDITURES 1,061,091-3,433,779 2,372,688 OTIIER FINANCING SOURCES (USES): Operating transfers -In 821,055 812,195 (8,860) Operating transfers -Out (3,281,099) (3,536,765) (255,666) Total Other Financing Sources (Uses) (2,460,044) (2,724,570) (264,526) EXCESS (DEFICIENCy) OF REVENUES AND OTIIER FINANCING SOURCES OVER (UNDER) EXPENDITURES AND OTHER FINANCING USES ~ (1,398,953) 709,209 $ 2,108,162 FUND BALANCES AT BEGINNING OF YEAR -RESTATED 5,953,038 FUND BALANCES AT END OF YEAR ~ 6,662,247 See accompanying notes to general purpose financial statements. 8 ) , I I SPECIAL REVENUE FUNDS DEBT SERVICE FUNDS VARIANCE VARIANCE FAVORABLE FAVORABLE ] BUDGET ACTUAL (UNFAVORABLE) BUDGET ACTUAL (UNFAVORABLE) $ 86,376 $ 86,895 $ 519 $ 2,792,591 $ 3,203,499 $ 410,908 636,575 148,582 (487,993) 2,115 2,115 670,660 836,884 166,224 78,150 39,995 (38,155) 2,770,927 2,145,535 (625,392) 4,735,677 6,573,396 1,837,719 1,285,706 1,409,499 123,793 10,185,921 11,202,906 1,016,985 2,870,741 3,243,494 372,753 197,524 128,924 68,600 1,439,308 1,479,852 (40,544) 2,629,227 2,689,052 (59,825) 344,000 412,959 (68,959) 3,720,362 3,513,018 207,344 10,805,201 2,938,419 7,866,782 775,000 801,000 (26,000) 1,953,927 1,909,490 44,437 19,135,622 11,162,224 7,973,398 2,728,927 2,710,490 18,437 1 (8,949,701) 40,682 8,990,383 141,814 533,004 391,190 1 2,992,849 2,986,961 (5,888) 7,585 7,585 (504,357) (498,361) 5,996 (8,448) (16,896) (8,448) 2,488,492 2,488,600 108 (8,448) (9,311) (863) $ (6,461,209) 2,529,282 $8,990,491 $ 133,366 523,693 $ 390,327 14,342,989 1,703,818 1 ~ 16,872,271 ~ 2,227,511 J 9 CITY OF SAN RAFAELs CALIFORNIA COMBINED STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND EQUITY -PROPRIETARY FUND TYPE AND DISCRETELY PRESENTED COMPONENT UNIT FOR THE FISCAL YEAR ENDED JUNE 30, 1998 PRIMARY GOVERNMENT COMPONENT TOTALS INTERNAL UNIT (MEMORANDUM SERVICE ENTERPRISE ONLY) OPERATING REVENUES: Charges for current services $ 1,434,929 $ $ 1,434,929 Sewer charges 4,570,151 4,570,151 Connection fees -----79,643 79,643 Total Operating Revenues 1,434,929 4,649,794 6,084,723 OPERATING EXPENSES Insurance premiums and claims 1,649,713 1,649,713 Sewage collection 1,442,139 1,442,139 Sewage treatment 1,843,050 1,843,050 Depreciation and amortization 743,427 743,427 General and administrative 171,926 171,926 Total Operating Expenses 1,649,713 4,200,542 5,850,255 Operating income (loss) (214,784) 449,252 234,468 NON-OPERATING REVENUES (EXPENSES): Property taxes 381,497 381,497 Special assessments -Bayside Acres 61,116 61,lI6 Aid from governmental agencies 10,529 10,529 I...J Investment income 105,002 31,147 136,149 Interest expense (299,835) (299,835) Refunds 157,915 157,915 Other non-operating revenues (15,782) (15,782) Operating transfers -In 212,500 212,500 Total Non-operating Revenues 475,417 168,672 644,089 Net Income 260,633 617,924 878,557 Add: depreciation expense on assets acquired by contributed capital 286,478 286,478 Increase in retained earnings 260,633 904,402 1,165,035 Retained earnings -beginning of year 10,941,182 10,941,182 Retained earnings -end of year 260,633 11,845,584 12,106,217 Contributed capital -beginning of year 8,321,036 8,321,036 Less: depreciation expense accumulated (286,478) (286,478) Contributed capital -end of year 8,034,558 8,034,558 Total Fund Equity $ 260,633 $ 19,880,142 $ 20,140,775 See accompanying notes to general purpose fmancial statements. 10 1 I ) ! 1 1 J 1 ] 1 J 1 J ] CITY OF SAN RAFAEL. CALIFORNIA COMBINED STATEMENT OF CASH FLOWS - PROPIDETARY FUND TYPE AND DISCRETELY PRESENTED COMPONENT UNIT FOR THE FISCAL YEAR ENDED JUNE 30, 1998 PRIMARY GOVERNEMENTCONWONENT TOTALS CASH FLOWS FROM OPERATING ACTIVITIES: Operating income/(loss) Adjustments to reconcile operating income to net cash provided by operating activities: Depreciation and amortization Changes in current assets and liabilities: (Increase) decrease in: Prepaid expenses and other current assets Increase (decrease) in: Accounts payable and other current liabilities Excess ERAF refunded Net Cash Provided by/(Used for) Operating Activities CASH FLOWS FROM NON CAPITAL FINANCING ACTIVITIES: Property taxes Aid from governmental agencies Proceeds from assumption of liabilities Refunds received Operating transfers -in Net Cash Provided by Noncapital Financing Activities CASH FLOWS FROM CAPITAL FINANCING ACTIVITIES: Cash paid for capital acquisitions Special assessments -Bayside Acres Assessment District Interest received from certificates of participation principal cash Principal payments on certificates of participation Interest paid on certificates of participation Principal payments on Bayside Acres coupon bonds Interest paid on Bayside Acres coupon bonds Net Cash Used for Capital Financing Activities CASH FLOWS FROM INVESTING ACTIVITIES: Income from investments Net Cash Provided by Investing Activities Net Increase in Cash and Cash Equivalent Cash and Cash Equivalents -Beginning of Year Cash and Cash Equivalents -End of Year INTERNAL UNIT (MEMORANDUM SERVICE ENTERPRISE ONLY) $ (214,784) $ 449,252 743,427 (616) 13,624 (66,490) (201,160) 1,908,741 157,915 212,500 2,279,156 (15,782) 1,109,791 381,497 10,529 392,026 (762,550) 61,116 21,449 (185,000) (292,530) (110,000) (3,016) (1,270,531) 105,002 9,696 105,002 9,696 2,182,998 240,982 933,092 $ 2,182,998 $ 1,174,074 $ 234,468 743,427 (616) (52,866) (15,782) 908,631 381,497 10,529 1,908,741 157,915 212,500 2,671,182 (762,550) 61,116 21,449 (185,000) (292,530) (110,000) (3,016) (1,270,531) 114,698 114,698 2,423,980 933,092 $ 3,357,072 See accompanying notes to general purpose [mancial statements, 11 ) ) NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS ] 1 1 1 I I , I I 1 1 I 1 , J j } J J ] 1. CITY OF SAN RAFAEL. CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 REPORTING ENTITY AND SIGNIFICANT ACCOUNTING POLICIES The financial statements of the City of San Rafael (the City) have been prepared in conformity with generally accepted accounting principles (GAAP) as applied to governmental units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. A. REPORTING ENTITY The City maintains a Council-Manager form of government and provides the following services: public safety (police and fire), public works, community development, library, parks, recreation, childcare, and general administrative services. As required by generally accepted accounting principles, these financial statements present the City (the primary government) and its component units. Component units generally are legally separate entities for which a primary government is fmancially accountable. Financial accountability ordinarily involves meeting both of the following criteria set forth in GASB Statement No. 14; the primary government is accountable for the potential component unit, and the primary government is able to impose its will upon the potential component unit, or there is a possibility that the potential component unit may provide specific fmancial benefits or impose specific financial burdens on the primary government. In addition to having the same governing board, the City is fmancially accountable for the San Rafael Redevelopment Agency and the San Rafael Joint Powers Financing Authority, and management activities of both entities are conducted by City staff. The two legally separated entities are, in substance, part of the City's operations. The two entities are, therefore, blended into the City's general purpose fmancial statements. The component units discussed in this note are included in the City's reporting entity because of the significance of its operational or fmancial relationships with the City. Each component unit has a June 30 year end. Separately issued component unit financial statements can be obtained at the City of San Rafael, Finance Department, 1400 Fifth Avenue, San Rafael, California 94915. Blended Component Units: San Rafael Redevelopment Agency The San Rafael Redevelopment Agency (the Agency) was established under the provisions of the Community Redevelopment Law (California Health and Safety Code, commencing with Section 33000) primarily to assist in the clearance and rehabilitation of areas determined to be in a declining condition in the City of San Rafael (the City). Financial activity 12 CITY OF SAN RAFAEL, CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 of the Agency commenced in July 1983. Under the Agency's Redevelopment Plan (the Plan), approved in November 1982, the Agency proposes to assist in the development of the property located in the central San Rafael business core and east San Rafael. The Agency receives incremental tax revenues on the developed property due to increases in assessed value. The Agency functions as an independent entity. The City Council serves as the governing board of the San Rafael Redevelopment Agency. The Agency's assets, liabilities, revenues and expenditures (other than those applicable to its fixed assets and long term debt) are blended into the Capital Projects Funds and Debt Service Funds. The Agency's flXed assets are included in the General Fixed Assets Account Group. The Agency's long-term debts are blended into the General Long-Term Debt Account Group. San Rafael Joint Powers Financing Authority The San Rafael Joint Powers Financing Authority (the Financing Authority) was created by the City of San Rafael pursuant to Articles 1 and 2 of Chapter 5 of Division 7 of Title 1 of the Government Code of the State of California for the purpose of assisting the fmancing and refmancing of certain assessment district activities of the City. All of the Financing Authority's assets, liabilities, revenues and expenditures are blended into the Capital Projects Funds and the Debt Service Funds. The Financing Authority's long-term debts are blended into the General Long-Term Debt Account Group. Discretely Presented Component Unit: San Rafael Sanitation District The San Rafael Sanitary District (the District) was formed in 1947 under Section 4700 of the California Health and Safety Code to provide wastewater transmission over the southern two-thirds of the City of San Rafael and adjacent unincorporated areas. The City contracts with the District to maintain the collection systems in the City and unincorporated areas. The District is governed by a three member Board of Directors who are appointed to four year terms. The City Council of the City of San Rafael appoints two out of the three board members and has the ability to remove the two board members at will. 13 1 1 ] 1 I I j J J 1 1 I j 1 , I (;lTY OF SAN RAFAEL. CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 The activities of the District are accounted for in a single enterprise fund. The District's assets, liabilities, revenues, expenses, results of operation and cash flows are discretely presented on the City's general purpose financial statements. Separately issued component unit financial statements can be obtained at Central Marin Sanitation Agency, Finance Department, 1301 Andersen Drive, San Rafael, CA 94901. B. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description of Funds and Account Groups -The accounts of the City are organized on the basis of funds and account groups, each of which is considered a separate accounting entity with its own self-balancing accounts that comprise its assets, liabilities, fund equity, revenues and expenditures. These funds and accounts are established for the purpose of carrying out specific activities or certain objectives in accordance with specific regulations, restrictions or limitations. Government resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled. The various funds are grouped in the fmancial statements in this report into categories as follows: Governmental Funds • The General Fund is the general operating fund of the City. It is used to account for all fmancial resources except those required to be accounted for in another fund. • Special Revenue Funds are used to account for the proceeds of specific revenue sources (other than expendable trusts or major capital projects) that are legally or administratively restricted to expenditures for specified purposes. • Debt Service Funds are used to account for the accwnulation of resources for, and the payment of, general long-tenn debt principal, interest and related costs. • Capital Projects Funds are used to account for financial resources to be used for the acquisition or construction of major capital facilities. 14 CITY OF SAN RAFAEL, CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 Proprietary Funds • Enterprise Funds are used to account for operations that are financed and operated in a manner similar to private business enterprises where the intent of the governing body is that the cost (expenses, including depreciation) of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges; or where the governing body has decided that periodic determination of revenues earned, expenses incurred, and/or net income is appropriate for capital maintenance, public policy, management control, accountability, or other purposes. • Internal Service Funds are used to account for the financing of goods or services provided by one department or program to other departments or programs of the City, or to other governments, on a cost-reimbursement basis. Fiduciary Funds • Expendable Trust Funds are accounted for in the same manner as governmental funds. (All trust funds of the City of San Rafael are classified as expendable.) • Agency Funds are custodial in nature and do not involve the measurement of the results of operations. They are used to account for monies received by the City of San Rafael as an agent for individuals, other governments and other entities. Account Groups • The General Fixed Assets Account Group is used to maintain control and cost information on capital assets acquired to perform general government functions. • The General Long-Term Debt Account Group is used to record the unmatured principal of tax allocation bonds, special assessment bonds, notes, compensated absences, the principal amount of future lease payments due under lease purchase agreements and other long-term liabilities. 15 1 1 , 1 1 1 1 1 1 1 J J 1 I c. fV OF SAN RAFAEL. CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 C. MEASUREMENT FOCUS All governmental funds are accounted for using a current financial resources measurement focus. With this measurement focus, only current assets and current liabilities generally are included on the balance sheet. Operating statements of these funds present increases (Le., revenues and other financing sources) and decreases (Le., expenditures and other financing uses) in net current assets. D. BASIS OF ACCOUNTING All governmental funds, expendable trust funds and agency funds are accounted for using the modified accrual basis of accounting. Their revenues are recognized when they become susceptible to accruals, that is, when both are measurable and available. "Measurable" means the amounts of the transaction can be determined and "available" me~s collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. All proprietary funds are accounted for using the accrual basis of accounting. Revenues are recognized in the accounting period in which they are earned and expenses are recognized in the accounting period in which they are incurred. The City applies all F ASB statements that do not conflict with or contradict GASB guidance. Accrued revenues include property taxes, sales taxes, transient occupancy taxes, gas tax, franchise fees, interest and grants. Grant revenues which are received as reimbursement for specific purposes or projects, are recognized based upon when the related expenditures are recorded. Grant revenues which are virtually unrestricted as to purpose and revocable only for failure to meet prescribed compliance requirements are reflected as revenues at the time of receipt or earlier if availability criterion are met. Licenses, fmes and penalties and other revenues are recorded as revenues when received in cash because they are generally not measurable until actually received. Investment earnings are accrued since they are measurable and available. Expenditures under the modified accrual basis of accounting are recognized when the related fund liability is incurred, except for principal and interest on general long-term obligations which are recognized when due. Liabilities expected to be paid after the current period are recorded in the General Long-Term Debt Account Group. Agency-type funds are custodial in nature (assets equal liabilities) and thus do not involve measurement of results of operations. 16 CITY OF SAN RAFAEL, CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 E. BUDGETS AND BUDGETARY ACCOUNTING The City annually adopts a budget to be effective July 1 for the ensuing fiscal year. From the effective date of the budget, which is adopted at the department level, the amounts stated therein as proposed expenditures become appropriations to the various City departments. The City Council may amend the budget by resolution during the fiscal year. The City Manager is authorized to transfer budgeted amounts between accounts, departments or funds; the Council must approve any increase in the City's total budget. Several supplemental appropriations were approved during the course of the year. All unencumbered appropriations lapse at year end. The City legally adopts budgets for all its governmental funds, except for the East Francisco boulevard Assessment District and 1997 Reassessment District Debt Service Funds because the City is only required to make Debt Service payments in the event of bondholder default. The City also adopts budgets annually for its internal service funds. The basis of accounting applied to the budget data presented for the General Fund, Special Revenue Funds, and the Debt Service Funds is the modified accrual basis of accounting, and also confonns to generally accepted accounting principles (GAAP). The Capital Projects Funds budgets are based on a project time frame, rather than a fiscal year "operating" time frame, reappropriating unused appropriations from year to year until project completion. Supplemental appropriations for the fiscal year ended June 30, 1998, were as follows: Original Supplemental Amended Fund Budget Appropriations Budget General Fund $ 28,148,940 $1,467,847 $ 29,616,787 Special Revenue Funds 8,893,506 10,242,116 19,135,622 Debt Service Funds 2,728,927 2,728,927 Encumbrance accounting, under which purchase orders, contracts and other commitments for expenditures are recorded in order to reserve that portion of the applicable appropriation, is employed as an extension of the budgetary process. Encumbrances outstanding at year end are reported as reservations of fund balances since they do not constitute expenditures or liabilities and are carried forward in the subsequent year's budget. 17 1 1 1 I J J j t:ITY OF SAN RAFAEL. CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 F. CASH AND CASH EQUIVALENTS Cash and cash equivalents are considered to be all highly liquid investments, with a maturity of ninety days or less from the date of purchase and includes all cash held in the City's cash and investment pool. G. INVESTMENTS H. Investments are stated at fair market value. The City adopted Governmental Accounting Standards Board Statement No. 31 (GASB 31), which requires that the City's investments be carried at fair market value. Under GASB 31, the City is required to adjust the carrying value of its investments to reflect their fair market value at each fiscal year end and include the effects of these adjustments in revenue for that fiscal year. GASB 31 applies to all the City's investments, even if they are held to maturity and redeemed at full face value. Since the City's policy is to hold all investments to maturity, the fair market value adjustments required by GASB 31 result in accounting gains or losses (called "recognized" gains or losses) which do not reflect actual sales of the investments (called "realized gains or losses). Thus, recognized gains or losses on an investment purchased at par will now reflect changes in its market value at each succeeding fiscal year end, but these recognized gains or losses will net to zero if the investment is held to maturity. By following the requirements of GASB 31, the City is reporting the amount of resources which would actually have been available if it had been required to liquidate all its investments at any fiscal year end. For further details of recognized gains or losses, refer to Note 2 and 21. RESTRICTED CASH AND INVESTMENTS Certain proceeds of various special assessment bonds, as well as certain resources set aside for their repayment, are classified as restricted cash and investments on the balance sheet because their use is limited to debt service by applicable bond covenants. I. GENERAL FIXED ASSETS General Fixed assets are recorded as expenditures of the various governmental funds at the time of purchase and are subsequently capitalized for memorandum purposes in the General Fixed Asset Account Group. Such assets include land, buildings, building improvements, furniture and equipment. Public domain "infrastructure" fixed assets such as roads, streets and sidewalks, bridges, curbs and gutters, drainage systems, lighting systems and similar assets are not capitalized. No depreciation is provided on general fixed assets. 18 CITY OF SAN RAFAEL. CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 All fixed assets are valued at historical cost or estimated historical cost if actual historical cost is not available. Donated fixed assets are valued at their estimated fair market value on the date donated. Fixed assets acquired by lease obligations are valued at the present value of future lease payments at the inception of the lease. The collection systems and facilities of the Component Unit are stated at cost less accumulated depreciation. Assets contributed have been recorded at the fair market value at the date received. Maintenance and repairs are charged to expense as incurred. Improvements are capitalized and depreciated over the remaining useful lives of the related fixed asset. Depreciation is computed using the straight-line method over the useful lives of the assets. A summary of the useful lives of the fixed assets of the Component Unit is as follows: Subsurface lines Sewage collection facilities General plant and administrative facilities 50 years 5 -50 years 3 -15 years J. ACCUMULATED UNPAID VACATION AND SICK LEAVE The City acco~ts for compensated absences (unpaid vacation, sick leave, compensatory time and administrative leave) expected to be currently payable as accrued payroll and benefits liability in the governmental funds to which they relate. The balance of the earned and vested, but unused, compensated absences expected to be paid subsequent to June 30, 1998, is recorded in the General Long-Term Debt Account Group. Sick pay vesting was discontinued for employees hired after 1988. No expenditure was recorded for these amounts. K. APPROPRIATION LIMITATIONS Under Article XIIIB of the California Constitution (the Gann Spending Limitation Initiative), the City is restricted as to the amount of annual appropriations from proceeds of taxes. For the fiscal year ended June 30, 1998, based on calculations by City's management, proceeds of taxes did not exceed related appropriations. Further, Section 5 of the Article XIIIB allows the City to designate a portion of fund balance for general contingencies to be used for any purpose. L. PROPERTY TAX LEVY COLLECTION AND MAXIMUM RATES The State of California (State) Constitution Article XIII A provides that the combined maximum property tax rate on any given property may not exceed one percent of its assessed value unless an additional amount for general obligation debt has been approved by voters. Assessed value is calculated at 100% of market value as defined by Article XIII A and may be adjusted by no more than two percent per year unless the 19 J J 1 1 ~ 1 , j 1 ) I LITY OF SAN RAFAEL. CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 property is sold, transferred or improved. The State Legislature has detennined the method of distribution of receipts from a one percent tax levy among the counties, cities, school districts and other districts. Marin County assesses, bills for and collects property taxes as follows: Lien dates Levy dates Due dates Delinquency as of March 1 July 1 Secured 50% on November 1 50% on February 1 December 10 (for November) April 10 (for February) Unsecured March 1 July 1 July 1 August 31 The tenn "unsecured" refers to taxes on personal property other than real estate, land and buildings. These taxes are secured by liens on the property being taxed. Property taxes levied are recorded as revenue when received in the fiscal year of levy because of the adoption of the "alternate method of property tax distribution," known as the Teeter Plan, by the City and the County of Marin. The Teeter Plan authorizes the auditor-controller of the County of Marin to allocate 100% of the secured property taxes billed, but not yet paid. The County of Marin remits tax monies to the City in three installments, as follows: 55% remitted on December 15 40% remitted on April 15 5% remitted on June 15 M. TAXPAYER-ASSESSED TAXES ACCRUAL In accordance with Governmental Accounting Standards Board (GASB) Statement No. 22, the City recognizes taxpayer-assessed taxes in Governmental Funds as follows: Sales Taxes -The City accrues actual advances from the State Board of Equalization received in July and August of the subsequent fiscal year as these amounts are both measurable and available to the City to meet its financial obligations for the current period. Public Safety Sales Tax (Proposition 172 Sales Tax) -The City accrues July and August receipts of the public safety sales tax on the basis consistent with the accrual of regular sales taxes. 20 CITY OF SAN RAFAEL. CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 Transient Occupancy Taxes -The City collects transient occupancy taxes on a quarterly basis. The taxes assessed for the quarter ended June 30 are due by July 31 of the subsequent fiscal year. The City accrues all transient occupancy taxes for the June 30th quarter received subsequent to the fiscal year end. Gas Taxes -The City accrues gas taxes assessed for the month ended June 30 as these amounts are both measurable and available to the City a month after the fiscal year end. Franchise Fees -The City collects cable franchise fees on a quarterly basis and refuse franchise fees on a monthly basis. The taxes assessed for the quarter ended June 30 are due by July 31 of the subsequent fiscal year. The City accrues all franchise fees for the June 30th period received subsequent to the fiscal year end. N. CLAIMS AND JUDGMENTS Claims and judgments that normally would be liquidated with expendable available resources are accounted for in the Internal Service Funds. O. "TOTALS (MEMORANDUM ONL Y)" INFORMATION Columns on the accompanying combined fmancial statements captioned "Totals (Memorandum Only)" do not present consolidated fmancial information. They are not necessary for a fair presentation of the fmancial statements, but are presented as additional analytical data. Interfund elimination's have not been made in the aggregation of this data. 2. CASH AND INVESTMENTS Cash balances from all funds are combined and invested to the extent possible pursuant to the City Council approved Investment Policy and Guidelines and California Government Code. The earnings from these investments are allocated quarterly to each fund based on an average of quarterly opening and closing balances of cash and investments. Investments are stated at fair market value as required by adopted Governmental Accounting Standards Board Statement No. 31 (GASB 31). The market value information is provided as quoted on June 30, 1998. 21 ~ 1 J 1 ~1 ] J J , ~lTY OF SAN RAFAEL. CALIFORNlA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 Authorized Investments: Authorized investments per the City's Investment Policy and Section 53601 of the California Government Code are: Mutual Funds Composed Entirely of U.S. Governmental Securities or other allowable investments Negotiable Certificates of Deposit U.S. Government Securities Bankers Acceptances Commercial Paper Medium-Term Corporate Notes California Local Agency Investment Fund (LAlF) California Arbitrage Management Program (CAMP) Repurchase Agreements Federal Agency Obligations: Federal Intermediate Credit Bank Debentures (FICB) Federal Land Bank Bonds (FLB) Federal Home Loan Bank Notes and Bonds (FHLB) Federal National Mortgage Association Obligations (FNMA) Small Business Administration Obligations (SBA) Government National Mortgage Association Obligations (GNMA) Tennessee Valley Authority Notes (TV A) Student Loan Association Notes (SALLIE MAE) California Local Agency Investment Fund (LAlF): LAIF is a special fund of the California State Treasury through which local governments may pool investments. Each city or agency may invest up to $20,000,000 in the fund. Investments in LAIF are highly liquid, as deposits can be converted to cash within 24 hours. California Arbitrage Management Program (CAMP): CAMP is a non-taxable investment fund under provisions of the California Joint Exercise of Powers Act to provide California Public Agencies with comprehensive investment management, accounting and arbitrage rebate calculation services for proceeds of tax- exempt financing. 22 CITY OF SAN RAFAEL, CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 Cash and investments at June 30, 1998, excluding the discretely presented component unit, consisted of the following: Cash: Demand accounts at banks Petty cash Cash with Fiscal Agent Investments: Medium-Term Corporate Notes Federal Home Loan Bank Notes Federal National Mortgage Association Obligations Federal Home Loan Mortgage Corporation Federal Farm Credit Bank Investments with Fiscal Agent: Mutual Funds -Federal Securities Surety Bonds Restricted cash on deposit with bank trust departments -Deferred Compensation California Local Agency Investment Fund California Arbitrage Management Program Total Cash and Investments The distribution of these monies by funds was as follows: Funds: General Special Revenue Debt Service Capital Projects Internal Service Expendable Trusts Agency TOTAL 23 $ 763,834 6,700 71,678 5,330,807 3,247,884 3,010,000 1,001,250 1,004,550 340,762 631,468 11,496,347 17,356,742 901.152 $ 45.163.174 $ 4,975,183 16,479,887 2,227,511 7,373,715 2,182,998 427,533 11,496,347 $45.163.174 j 1 r 1 1 , . f 1 , ] 1 , I 1 1 J J J J t.:ITY OF SAN RAFAEL, CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 Pooled Deposits/Credit Risk All pooled certificates of deposit and bank balances are entirely insured or collateralized. The California Government Code requires California banks and savings and loan associations to secure an agency's deposits by pledging government securities as collateral. The market value of the pledged securities must equal at least 110% of an agency's deposits. California law also allows fmancial institutions to secure local agency deposits by pledging first trust deed mortgage notes leaving a value of 150% of a local agency's deposits. The City may waive collateral requirements for deposits which are fully insured up to $100,000 by the Federal Deposit Insurance Corporation (FDIC) or the Federal Savings and Loan Insurance Corporation (FSLIC). Three categories of risk level have been developed by the Government Accounting Standards Board (GASB) Statement No. 3 to disclose the various risk associated with deposits and investments of public money: Category 1 -insured or collateralized with securities held by the City or its agent in the City's name. Category 2 -collateralized with securities held by the pledging financial institution's trust department or agent in the City's name. Category 3 -uncollateraIized or collateralized with securities held by the pledging fmanciaI institution~s trust department or agent but not in the City's name. Credit Risk, Carrying Amount and Market Value of Investments Investments made by the City are classified as to credit risk by three categories, as follows: Category 1 -insured or registered, or securities held by the City or its agent in the City's name. Category 2 -uninsured or unregistered, with securities held by the counterparty's trust department or agent in the City's name. Category 3 -uninsured or unregistered, with securities held by the counterparty, or by its trust department or agent but not in the City's name. 24 CITY OF SAN RAFAEL, CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 Investments in pools managed by other governments or in mutual funds are not required to be categorized pursuant to GASS Statement No.3. Category: Carrying __ 1 2 3 Amount DeQosits Pooled Deposits Demand Accounts: Bank balances $100,000 $ 1,040,117 $ $ 1,140,117 Deposits in transit * 333,819 Outstanding checks * (710,102) Petty cash * ~700 Book balance 770,534 Deposits with Fiscal Agents Cash with Marin County 69,264 69,264 Cash in escrow fund 2,414 ---..k414 Total Deposits $100,000 $ 1,040,117 $71,678 $ 842,212 • Not subject to categorization. 25 J ] J l i J J * Not subject to categorization. (\) Includes deferred compensation plan investment. (2) At June 30, 1998, market value of LA IF was $31,932,227,970. The City'S proportionate share of the value is $17,356,742. Included in LAIF's investment portfolio are certain derivative securities or similar products in the form of structured notes and asset-backed securities totaling $1,335,637,000. LAIF's (and the City's) exposure to risk (credit, market, or legal) is not currently available. 26 CITY OF SAN RAFAEL, CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 3. TAXES RECEIVABLE Accounts receivable at June 30, 1998, consisted of the following: Property taxes Sales taxes Transient occupancy taxes Franchise fees Miscellaneous taxes & fees TOTAL 4. FIXED ASSETS General Fund $ 111,097 2,119,578 295,719 143,104 38~553 $2,708,051 Capital Projects Funds $439,444 $439.444 Totals $ 550,541 2,119,578 295,719 143,104 38~553 $3.147.495 A summary of changes in general fixed assets for the fiscal year ended June 30, 1998, is as follows: Land and buildings Rolling equipment Furniture and equipment Improvements other than buildings Investment in general fixed assets Balance at JulYl...1998 $21,873,389 4,903,627 4,752,106 3,286,732 $34,815,854 27 Additions $ 350,960 783,538 614,895 $1.749,393 Deletions $ 171,577 46,020 $217.597 Balance at June 30~ 1998 $ 22,224,349 5,515,588 5,320,981 3,286,732 $36.347,650 1 I , I I 1 1 J , I , I I 1 . I I 1 J 1 J l ) L.iTY OF SAN RAFAEL, CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 5. LONG· TERM DEBT The City records long-term debt of governmental funds in the General Long-Term Debt Account Group. Other governmental fund obligations not expected to be financed with current available fmancial resources are also recorded in the general long-term debt account group. Long-term debt outstanding at June 30, 1998, was as follows: San Rafael Joint Powers Financing Authority: 1998 Authority Revenue Bonds San Rafael Redevelopment Agency Tax Allocation Bonds: Series 1992 Series 1995 Total Tax Allocation Bonds Special Assessment Bonds (with governmental commitment) Lucas Valley Peacock Gap Refunding Mariposa Road Assessments Total Special Assessment Bonds (with governmental commitment) Note payable Total Long-term Debt Interest Authorized Outstanding Maturi.!Y Rates and Issued June 30~ 1998 2011 4.00 -6.00% 5,250,000 $ 5,230,000 2017 2021 1998 2005 2008 2025 28 3.25 -6.45 18,615,000 4.00 -6.00 8,895,000 5.50 -5.75 4.00 -4.75 4.50 -6.90 8.00 217,393 2,405,000 233,688 15,980,000 8,230,000 24,210,000 4,000 1,590,000 175,000 1,769,000 169,000 $ 31,378,000 LJTY OF SAN RAFAEL, CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 Long-tenn debt transactions during the fiscal year ended June 30, 1998 were as follows: Tax Special Liability Vacation and Revenue Allocation Assessment Note Lease Sick Leave Bonds Bonds Bonds Payable Total Debt Purchases Obligations Balance atJuly I, 1997 $ 5,250,000 $ 24,790,000 $ 1,970,000 $ 169,000 $ 32,179,000 $ 19,576 $ 2,474,288 Additions: Lease purchases 113,814 Accrued interest 172,247 Vacation and sick leave obligations (net) Retirements: Principal repayments 20,000 580,000 201,000 801,000 30,957 Balance at June 30, 1998 $ 5,230,000 $ 24,210,000 $ 1,769,000 $ 169,000 $ 31,378,000 $102,433 $ 2,646,535 Debt service requirements, including interest, are follows: Tax Special Liability Revenue Allocation Assessment Note Lease Bonds Bonds Bonds Payable Purchases Totals Year Ending June 30: 1999 $ 671,743 $ 2,057,435 $ 314,565 $ $ 22,763 $ 3,066,506 2000 669,743 2,050,284 317,710 22,763 3,060,500 2001 671,068 2,055,640 314,520 22,763 3,063,991 2002 675,405 2,054,312 310,260 22,763 3,062,740 2003 667,405 2,048,064 309,833 11,381 3,036,683 Thereafter 3,778,050 33,065,801 791,517 642,200 38,277,568 Total $ 7,133,414 $ 43,331,536 $ 2,358,405 $ 642,200 $102,433 $ 53,567,988 29 1 J 1 1 1 1 I 1 .J I I I j J ] 1 I I I \"'~TY OF SAN RAFAEL. CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 A. 1992 AGENCY REFUNDING BOND On May 1, 1992, the Agency issued Tax Allocation Refunding Bonds in the amount of $18,615,000. The proceeds of the bonds were used to refund $10,905,000 outstanding principal of the Agency's Central San Rafael Redevelopment Project Tax Allocation Bonds, Series 1985 which were issued in May 1985 to fund the construction of new improvements within the Project Area. The defeased Central San Rafael Redevelopment Project Tax Allocation Bonds, Series 1985, was fully called during the fiscal year ended June 30, 1992. Thus, no amount is outstanding at June 30, 1998. The 1992 Bonds mature annually each December 1 from 1992 to 2017, in amounts ranging from $340,000 to $1,350,000 and bear interest at rates ranging from 3.25% to 6.45%. Interest is payable semiannually on June 1 and December 1. Bonds maturing on or after December 1,2002 are subject to the optional redemption prior to maturity, in whole or in part, in inverse order of maturity on any date on or after December 1, 2002 at a price equal to the principal amount, plus accrued interest on the redemption date, plus a premium ranging from 0.00% to 2.00%. The Bonds are secured by an irrevocable pledge of the Tax Revenues and other funds. The annual requirements to amortize the outstanding bond indebtedness as of June 30, 1998, including interest, are as follows: Year Ending June 30, Principal Interest Total 1999 $ 430,000 $ 998,057 $ 1,428,057 2000 450,000 972,407 1,422,407 2001 480,000 945,662 1,425,662 2002 505,000 916,844 1,421,844 2003 535,000 885,629 1,420,629 Thereafter 13,580,000 7,540,588 21,120,588 Total ~ 15,980,000 $12,259,187 $28,239,187 30 CITY OF SAN RAFAEL, CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 B. 1995 AGENCY BOND On October 1, 1995, the Agency issued Tax Allocation Bonds in the amount of $8,895,000. The proceeds of the bonds were used to fmance certain redevelopment activities of the Agency relating to the Central San Rafael Redevelopment Project Area. The Bonds mature annually each December 1 from 1995 to 2021, in amounts ranging from $170,000 to $610,000 and bear interest at rates ranging from 3.50% to 6.00%. Interest is payable semiannually on June 1 and December 1. Bonds maturing on or after December 1,2003 are subject to optional redemption prior to maturity, in whole or in part, either in inverse order of maturity or on a pro rata basis among maturities on any date on or after December 1, 2002 at a price equal to the principal amount, plus accrued interest on the redemption date, plus a premium ranging from 0.00% to 2.00%. The Bonds are secured, on a parity with the 1992 Bonds, by a pledge and lien on Tax Revenues and amounts on deposit in certain funds and accounts held by the Fiscal Agent. The annual requirements to amortize the outstanding bond indebtedness as of June 30, 1998, including interest, are as follows: Year Ending June 30, Principal Interest Total 1999 $ 185,000 $ 445,378 $ 630,378 2000 190,000 437,877 627,877 2001 200,000 429,988 629,988 2002 210,000 421,468 631,468 2003 215,000 412,435 627,435 Thereafter 7,230,000 4,715,212 11,945,212 Total $8,230,000 $6,862,358 $ 15,092,358 C. 1998 AUTHORITY REVENUE BONDS On January 28, 1998, the San Rafael Joint Powers Financing Authority issued Revenue Bonds in the amount of $5,250,000 bearing interest at rates from 4.00% to 6.00%. The proceeds of the bonds were used to acquire Reassessment District Bonds in the amount of $4,965,000 bearing interest at rates from 5.246% to 6.996% issued by ~e City during the fiscal year for the purpose of consolidating and refunding the previously issued special assessment bonds: Sun Valley Open Space District, Series No. 1985-3; Kerner Boulevard Refunding Assessment District, Series 1986-1; and Civic Center -Northgate Refunding Assessment District, Series 1991-1. The 1998 Authority Revenue Bonds mature annually each September 2 from 1998 to 2011, in amounts ranging from $20,000 to $555,000. Interest is payable semiannually on 31 J 1 J 1 ~l 1 1 1 1 1 J 1 D. E. \.-lTY OF SAN RAFAEL. CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 March and September 2. The Bonds are subject to redemption in advance of maturity at the option of the City upon payment of the principal and interest accrued thereon to the date of redemption, plus a redemption premium ranging from 2.00% to 5.00%. Revenues from the Reassessment District Bonds are utilized to meet debt service requirements of the Revenue Bonds. The Reassessment District Bonds are secured by unpaid reassessments confirmed against private property within the applicable Reassessment District. The annual requirements to amortize the outstanding bond indebtedness as of June 30, 1998, including interest, are as follows: Year Ending June 30, Principal Interest Total 1999 $ 400,000 $ 271,743 $ 671,743 2000 415,000 254,743 669,743 2001 435,000 236,068 671,068 2002 460,000 215,405 675,405 2003 475,000 192,405 667,405 Thereafter 3,045,000 733,050 3,778,050 Total $5,230,000 $1,903,414 $7,133,414 OTHER LONG-TERM OBLIGATIONS At June 30, 1998, other long-term obligations consisted of a $169,000 promissory note bearing interest at 8% with principal and accrued interest due and payable in November 2024. The note was assumed to fmance the purchase of certain property by the Agency. Accrued interest at June 30, 1998 was $116,763. SPECIAL ASSESSMENT DEBT The City is "obligated in some manner" (as defined by GASB Statement No.6) for special assessment debt (1) because the City must cover delinquencies of special assessment bonds with other resources until foreclosure proceeds are received or (2) because the City has been indicated that it may do so. Long-term debt does not include special assessment debt issued under the 1911 Bond Act as the City is not liable in any manner for repayment. The County of Marin acts as the City's agent for property owners in collecting the assessments and forwarding the collections to bondholders. The 1911 Bonds were fully retired during the fiscal year ending June 30, 1998. 32 {;ITY OF SAN RAFAEL, CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 6. CAPITAL LEASES The City leases various equipment through capital leasing arrangements in the governmental funds. The assets and obligations for agreements of the governmental funds are recorded in the General Fixed Asset Account Group and the General Long-Term Debt Account Group, respectively. The equipment acquired through the capital leases totaled $212,921 at June 30, 1998. The future minimum lease obligations as of June 30, 1998, were as follows: Year Ending June 30, 1999 2000 2001 2002 2003 Subtotal Less: Amount representing interest Present value of minimum lease payments 7. LOANS RECEIVABLE The City has the following loans receivable at June 30, 1998: $22,763 22,763 22,763 22,763 11.381 102,433 (13,297) $89,136 A. $100,000 loan from Marin Housing Development at 5% interest rate; all principal and interest due January 30, 2005. B. $100,000 loan from One "H" Street Associates at 5% interest rate; all principal and interest due May 1, 1999. C. $303,000 loan from Centertown Associates, Ltd. at 3% interest rate due semi- annually. The remaining loan receivable at June 30, 1998, was $243,659. The final payment is due on July 1,2065. D. $392,000 loan from the City Manager at 5.56% interest rate; principal and interest due monthly until August 31, 2026. The principal balance outstanding at June 30, 1998, was $382,220. 33 , 1 1 1 1 1 I \ 1 1 } ) J 8. ,--lTY OF SAN RAFAEL. CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 E. $400,000 loan from the Chief of Police at 5.56% interest rate; principal and interest due monthly until August 1, 2027. The principal balance outstanding at June 30, 1998, was $393,784. INTERFUND RECEIVABLES AND PAY ABLES A summary of due from and due to other funds is as follows: Fund Special Revenue Funds: Childcare Fund Grants Fund Park Dedication Fund Capital Projects Funds: Bedroom Tax Fund Park Capital Projects Fund 1985 Capital Project and Administration Fund Low and Moderate Income Housing Fund 1992 Bonds Capital Project Fund 1995 Bonds Capital Project Fund Total Due From Due To $ 7,654 $ 7,654 57,000 34,845 91,845 1,150,199 1,150,199 518,438 518 .. 438 $ 1.768,136 $ 1,768.136 9. FUND EQillTY RESERVES AND DESIGNATIONS Fund balances and retained earnings consist of reserved and unreserved amounts. Reserved fund equity represent that portion of a fund equity which is not appropriable for expenditure or is legally segregated for a specific future use. The remaining portion is unreserved fund equity. Portions of unreserved fund equity may be designated to indicate tentative plans for fmancial resource utilization in a future period, such as for general contingencies or capital projects. Such plans or intent are subject to change, have not been legally authorized and may not result in expenditures. 34 CITY OF SAN RAFAEL.! CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 A detailed schedule of the fund balances and retained earnings at June 30, 1998, is shown as follows: Proprietary Fiduciary Governmental Fund T~Qes Fund T~~s FundT~Qes Special Debt Capital Internal Trust and General Revenue Service Projects Service Agenc~ Totals Fund balances/Retained earnings: Reserved: Encumbrances $ 76,691 $ 553,477 $ $ 5,940 $ $ $ 636,108 Petty cash 3,700 3,000 6,700 Community development 351,123 351,123 Department savings 235,753 235,753 Employee M.O.U. 1,678,264 1,678,264 Loans receivable 776,004 100,000 378,504 1,254,508 Taxes receivable 352,744 352,744 Debt service 2,213,810 2,213,810 Projects 68,838 703,463 4,065,822 4,838,123 ~uipmentreplacement 3,000 3,000 Building and structure 20,000 20,000 Facility closure 20,000 20,000 Liability payments 150,000 150,000 Land held for resale 2,004,514 2,004,514 Total Reserved 3,543,117 1,549,940 2,213,810 6,454,780 3,000 13.764.647 Unreserved and Designated: Library services 30,999 30,999 Public safety 324,681 324,681 Grant projects 321,063 321,063 Parkland 1,016,845 1,016,845 Construction 1,675,458 13,701 4,866,003 424,533 6,979,695 Traffic mitig.ation 8,655,173 8.655,173 Total Unreserved and Designated 12,024,219 13,701 4,866,003 424,533 17,328,456 Unreserved and Undesignated 3,119,130 3,298,112 (1,189,801) 260,633 5,488,074 TOTAL FUND EQUITIES $ 6,662,247 $16.872,271 $ 2,227,511 $10,130,982 $ 260,633 $ 427,533 $ 36,581,177 10. DEFICIT FUND BALANCES At June 30, 1998, the City has no funds with deficit fund balances. 35 L1TY OF SAN RAFAEL. CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 1 11. EXCESS OF EXPENDITURES OVER APPROPRIATIONS rl I J 1 1 l I 1 I Special Revenue Funds: Baypoint Lagoon Assessment District Household Hazmat Facility Development Services Library Public Safety Debt Service Funds: Mariposa Assessment District 1995 Agency Bonds 12. EMPLOYEES' RETIREMENT PLAN Plan Description Appropriations $ 24,500 708,785 344,000 45,032 97,595 23,235 632,578 Expenditures Excess $ 29,681 $ 5,181 734,631 25,846 412,959 68,959 77,692 32,660 106,203 8,608 23,650 415 632,595 17 The City contributes to the Marin County Employees' Retirement Fund (the Fund). All permanent employees are eligible to participate. The Fund is an agent multiple-employer defined benefit retirement plan that acts as a common investment and administrative agent for various local governmental agencies within the County of Marin. The Fund provides retirement, disability, and death benefits based on the employee's years of service, age and final compensation. Employees vest after five years of service and are eligible to receive retirement benefits after 10 years of service and have attained the age of 50, or 30 years of service (20 years for safety employees) regardless of age. These benefit provisions and all other requirements are established under the County Employees Retirement Law of 1937. The City's retirement plan is included in a separately issued report for the Marin County Employees' Retirement Fund, which can be obtained from William M. Mercer, Incorporated, 3 Embarcadero Center, Suite 1500, San Francisco, CA 94111-4015. Funding Policy The funding policy of the Fund provides for actuarially determined periodic contributions by the City at rates such that sufficient assets will be available to pay Fund benefits when due. The City contributed 12.52% of payroll to the Fund for public safety personnel and 7.75% for other covered employees for the year ended June 30, 1998. The City, due to a collective bargaining agreement, also has a legal obligation to contribute half of the employees' contribution up to a maximum of 7% of payroll for safety employees and a maximum of 5% of payroll for all other employees. Employees have an obligation to contribute the remaining portion. 36 (.;lTY OF SAN RAFAEL. CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 Annual Pension Cost The City's annual pension cost to the Fund for the year ended June 30, 1998 of $2,690,127 was equal to the city's required and actual contributions. The annual required contribution was determine as part of the actuarial valuation performed as of June 30, 1996. The employer rates for normal cost is determined using the Entry Age Normal Actuarial Cost Method, a projected benefit cost method. It takes into account those benefits that are expected to be earned in the future as well as those already accrued. The significant assumptions used in the 1996 actuarial valuation include an assumed rate of return on investment assets of 8%, and annual payroll increases of 5.50% per year reflecting 4.50% for inflation and approximately 1.00% for merit and longevity. The actuarial value of assets was determined using techniques that smooth the effects of short term volatility in the market value of investments over a period of five years. The Fund also uses the level percentage of payroll method to amortize the unfunded actuarial liability. It is assumed that payroll increases at an annual inflation rate of 4.5% over the amortization period. As of June 30, 1996 ten years are left in the amortization period. Three-Year Historical Trend Information Fiscal Year Annual Pension Cost Percentage of Net Pension EndinL.. (APC) APC Contributed Obligation 6/30/96 $ 2,989,846 100% $ 0 6/30/97 2,949,871 100% 0 6/30/98 2,690,127 100% 0 Actuarial Actuarial Actuarial Accrued Unfunded UAAL Valuation Value Liability (AAL) -AAL Funded Covered Asa%of Date of Assets ~ntryAge (UAAL) Ratio Payroll Payroll 6/30/94 $ 79,506,000 $ 88,849,000 $ 9,343,000 89% $ 13,945,000 67% 6/30/96 101,331,000 101,159,000 (172,000) 100% 15,403,000 (1)% 6/30/97 114,506,000 110,198,000 (4,308,000) 104% 16,928,000 (25.3)% 37 ) 1 I I r 1 1 I 1 I I ,-,lTY OF SAN RAFAEL. CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 13. PUBLIC AGENCY RETIREMENT SYSTEM (DEFINED CONTRIBUTION RETIREMENT PLAN) The City contributes to the Public Agency Retirement System (PARS), which is a defined contribution retirement plan. A defined contribution retirement plan provides retirement benefits in return for services rendered, provides an individual account for each participant, and specifies how contributions to the individual's account are to be determined instead of specifying the amount of benefits the individual is to receive. Under a defmed contribution pension plan, the benefits a participant will receive depend solely on the amount contributed to the participant's account, the returns earned on investments on those contributions, and forfeitures of other participant's benefits that may be allocated to such participant's account. As established by the plan, all eligible employees of the City will become a participant in the plan from the date they are hired. An eligible employee is any employee who, at any time during which the employer maintains this plan, is not accruing a benefit under the Marin County Employees Retirement Fund. (See Note 12). Contributiops made by an employee and the employer vest immediately. As determined by the plan, each employee must contribute 3.75% of gross earnings to the plan. The City contributes an additional 3.75% of the employee's gross earnings. During the year, the City contributed $79,585 and employees contributed $79,585. The total covered payroll of employees participating in the plan for the year ended June 30, 1998, was $2,122,268. The total payroll for the year was $22,727,965. 14. POST-EMPLOYMENT HEALTH CARE BENEFITS The City provides certain health care benefits for retired employees and their spouses. The benefit provisions were established under the authority of the 1937 Act, Section 31450, et. seq. of the Government Code. Substantially all of the City's employees may become eligible for these benefits if they are receiving a retirement benefit from the Marin County Employees' Retirement Fund within 120 days of retirement from City employment. At June 30, 1998, 164 retirees received post-employment health care benefits. Those expenditures are reduced by reimbursements from the Marin County Retirement Office of the annual amount set forth in the County Retirement Rules and Regulations 1937 Act as amended and in Sections 31450 et. seq. of the Government Code. The cost of retiree health care benefits is recognized as an expenditure as claims are paid. For the fiscal year ended June 30, 1998, those costs totaled $257,685. 38 CITY OF SAN RAFAEL, CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 15. DEFERRED COMPENSATION PLAN The City offers its employees a deferred compensation plan created in accordance with Internal Revenue Code Section 457. The plan, available to all City employees, permits them to defer a portion of their salary until future years. The deferred compensation is not available to employees until termination, retirement, death, or unforeseeable emergency. All amounts of comp~nsation deferred under the plan, all property and rights purchased with those amounts, and all income attributable to those amounts, property, or rights are (until paid or made available to the employee or other beneficiary) solety the property and rights of the City (without being restricted to the provisions of benefits under the plan), subject only to the claims of the City's general creditors. Participants' rights under the plan are equal to those of general creditors of the City in an amount equal to the fair market value of the deferred account for each participant. The City has no liability for losses under the plan but does have the fiduciary duty of due care that would be required of an ordinary prudent investor. The City believes that it is unlikely that it will use the assets to satisfy the claims of general creditors in the future. The City is in the process of transferring the deferred compensation plan to a trust account and will adopt Government Accounting Standards Board (GASB) Statement No. 32 in the fiscal year ending June 30, 1999. 16. SEGMENT INFORMATION FOR ENTERPRISE FUNDS The City's Enterprise Funds comprises only of the discretely presented component unit, San Rafael Sanitation District. Segment information for the fiscal year ended June 30, 1998, is as follows: Types of goods or services provided Wastewater transmission Operating revenues Depreciation and amortization expense Operating income Tax revenues Non-operating revenues (expenses) Net income Fixed asset additions Net working capital Total Assets Long-term obligations payable from operating revenues Total Fund Equity 39 $ 4,649,794 743,427 449,252 381,497 168,672 617,924 762,550 696,505 24,333,167 4,053,313 19,880,142 1 1 J I 1 1 J , L1TY OF SAN RAFAEL. CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 17. RISK MANAGEMENT The City is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors and omissions; injuries to employees; and natural disasters. The City is self-insured up to a maximum of $500,000 for each general liability claim, $250,000 for each workers' compensation claim, and $25,000 for each property damage claim. The City participates in a public agency risk sharing pool (California Joint Powers Risk Management Authority) for general liability claims in excess of the self-insured amounts up to $9,500,000. The City purchases commercial insurance for workers' compensation claims in excess of the self-insured amount up to $9,750,000. The City also purchases commercial insurance for property damage claims in excess of the self-insured amount up to $28,853,000. The City accounts for and fmances its uninsured risks of loss in the Internal Service Funds. The City had established a claims liability of$1,908,741 at June 30, 1998, based on the requirement of Governmental Accounting Standards Board Statement No. 10, which requires that a liability for claims be reported if information prior to the issuance of the fmancial statements indicates that it is probable that a liability has been incurred at the date of the financial statements and the amount of the loss can be reasonably estimated. Settled claims have not exceeded this coverage in any of the past three fiscal years. Changes in the general and workers' compensation claims liabilities for the fiscal years ended June 30, 1996, 1997 and 1998 are as follows: Balance at Current Year Balance at General Beginning of Claims & Changes Claim End of Liability Fiscal Year In Estimates Payments Fiscal Year 1995-96 $ 453,397 $ 563,376 $ (416,249) $ 600,524 1996-97 600,524 321,747 (193,159) 729,112 1997-98 729,112 135,381 (17,775) 805,634 Worker's Balance at Current Year Balance at Compensation Beginning of Claims & Changes Claim End of Liability Fiscal Year In Estimates Payments Fiscal Year 1995-96 $ 768,488 $ 920,005 $ (318,122) $ 1,370,371 1996-97 1,370,371 211,743 (362,038) 1,220,076 1997-98 1,220,076 421,352 (108,584) 1,103,107 40 CITY OF SAN RAFAEL. CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 The California Joint Powers Risk Management Authority which began operations in February 1986, is a governmental self-insurance cooperative organized under a joint power agreement consisting of 23 members which represent over 120 public agencies in California. The Risk Management Authority pools self-insurance losses of charter and associate members, develops risk management programs, and provides for administration of pooled coverage claims. The City paid $212,219 in premiums to the Risk Management Authority during the fiscal year ended June 30, 1998. Condensed [mancial information for the California Joint Powers Risk Management Authority for the fiscal year ended June 30, 1998 is as follows: Assets Liabilities Equity: Retained earnings Total Liabilities and Equity Revenues Expenses Refunds to members Net increase in retained earnings 18. JOINT POWER AGREEMENTS $55,507,730 $26,611,402 28,896,328 $ 55,507,730 $14,321,822 (3,766,467) (5,324,172) $ 5.231.138 The City participates in various organizations through formally organized and separate entities established under the Joint Exercise of Powers Act of the State of California. As separate legal entities, these entities exercise full powers and authorities within the scope of the related Joint Powers Agreement including the preparation of annual budgets, accountability for all funds, the power to make and execute contracts, and the right to sue and be sued. Obligations and liabilities of the separate entities are not those of the City. Joint Ventures: The Marin County Integrated On-Line Library System (the System) was formed to provide for the procurement, ownership, operation, maintenance, and governance of an integrated on-line library system that is jointly owned and operated by the Cities of San Rafael, Mill Valley, Sausalito, and the County of Marin. The Governing Board of the System consists of the library director or designated alternate of each partidpant in the System. In accordance with the cost sharing formula developed by the library directors of the participants, the City's share of the acquisition cost in" the amount of $108,007 represents 18.98% of ownership in the System. Operating costs for the System are also shared by each participant by applying the cost sharing the formula. Financial Statements of the System can be obtained at the County Librarian, Marin County Free Library, Civic Center, Administration Building, San Rafael, CA 94903. 41 1 1 J I ~fTY OF SAN RAFAEL, CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 The Marin Street Light Acquisition Joint Powers Authority (MSLAJPA) was formed by the County of Marin and twelve local agencies to acquire street light facilities, operate the facilities during the pendency of an eminent domain action against PG&E and subsequent transfer of the facilities to the individual local agencies. The Governing Board consists of five members from the participating agencies. Each of the local agencies' share of contribution was based on the number of street lights to be acquired in the local agencies' individual jurisdiction in relation to the total number of street lights to be acquired by the MSLAJP A. The Marin Emergency Radio Authority (the Authority) was formed by local agencies within Marin County to own and operate the public safety and emergency radio system. The Governing Board consists of one representative from each Member. Initially, the costs of system acquisition, maintenance, and operations will be divided on a pro rata share based on an agreed upon formula established by a majority of the governing board. Each Member will advance a deposit amount of money anticipated to be needed for the first twelve months of operations. Financial information may be obtained at the County of Marin, Assistant County Administrator, Civic Center, Room 325, San Rafael, CA 94902. Jointly Governed Organizations: The Countywide Planning Agency was established by the County of Marin and ten local cities to implement countywide performance standards for traffic, housing, water and sewer facilities, and environmental protection to ensure that residential and commercial growth does not exceed local water, sewer and transportation capacities. The Governing Board of the Countywide Planning Agency consists of one member of the County Board of Supervisors and one member of the City Council of each participating city. The Marin County Cable Rate Regulation Joint Powers Authority was established to regulate the rates for cable television service and equipment and to advise the participants in their exercise of their license authority. The Governing Board of the Marin County Cable Rate Regulation Joint Powers Authority consists of one member from each of the seven participating local cities. The Marin County Major Crimes Task Force was established by twelve local law enforcement agencies to provide funding and policy direction of a unit of peace officers and support personnel to detect, apprehend and prosecute major crimes including highly mobile criminal narcotic traffickers thus reducing major narcotic activity and combating its influence throughout the County. The Governing Board of the Marin County Major Crimes Task Force consists of nine members, one city council member, one member of the Marin County Board of Supervisors, two city managers, two chief law enforcement officials, two residents of Marin County, and the Marin County Administrator. The Marin County Hazardous and Solid Waste Joint Powers Authority was established by the County, local cities and waste franchising districts to fmance, prepare and implement source reduction and recycling elements on a county-wide integrated waste management plan as required by State Assembly Bill 939. 42 CITY OF SAN RAFAEL. CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 19. LITIGATION There are several pending lawsuits in which the City is involved. The City's attorneys estimate that the potential claims against the City not covered by insurance resulting from such litigation would not materially affect the fmancial statements of the City. 20. RELATED PARTY TRANSACTION On August 1, 1996, the City made a 30-year loan to the City Manager in the amount of $392,000, at an interest rate equivalent to Local Agency Investment Fund interest rate, for the purchase of a home. The loan is secured by the Deed of Trust. On August 1, 1997, the City made a 30-year loan to the Chief of Police in the amount of $400,000, at an interest rate equivalent to Local· Agency Investment Fund interest rate, for the purchase of a home. The loan is secured by the Deed of Trust. 21. FUND BALANCE. JULY 1.1997 -RESTATED 22. Government Accounting Standards Board Statement No. 31 (GASB 31) requires the City to restate June 30, 1997 fund balances for fair market value adjustments on investments. As a result, the City's fund balance at beginning of year was restated as follows: Originally Reported Adjustments Restated General Fund $ 5,948,519 $ 4,519 $ 5,953,038 Special Revenue Funds 14,333,042 9,945 14,342,987 Debt Service Funds 1,703,819 1,703,819 Capital Projects Funds 17,133,837 12,112 17,145,949 Expendable Trust Funds 452,138 452,183 YEAR 2000 The City's Information Services Committee formed a sub-committee to conduct a comprehensive review of its computer systems and equipment to identify systems that could be affected the "Year 2000" issue and is in the process of developing an implementation plan to resolve the issue.-The Year 2000 problem is the result of computer programs being written using two digits rather than four to defme the application year. Any of the City's programs that have time- sensitive software may recognize a date using "00" as the year 1900 rather than the year 2000. This could result in major system failure or miscalculations if not appropriately addressed. 43 I 1 1 I , 1 1 J I I J \ I I J 1 j LITY OF SAN RAFAEL. CALIFORNIA NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS JUNE 30, 1998 The City is in the process of modifying its BRC application programs which are accessed by Police' CAD and RMS, Financial Applications and the Recreation Departments. The costs incurred during the year was minimal and no significant additional costs are expected in the future. The City presently believes that, with modification to existing software, the Year 2000 problem will not pose significant operational problems for the City's computer systems as so modified and converted. 44 NOll. VWlIOJlNI AlIV l.N~W~'1ddflS l r I r [ f f r f r f l l l t [ I 1 1 ] I 1 J 1 ] ASSETS Cash and investments Accounts receivable Grants receivable Loans receivable Due from other funds TOTAL ASSETS CITY OF SAN RAFAEL. CALIFORNIA SPECIAL REVENUE FUNDS COMB~GBALANCESHEET JUNE 30, 1998 RECREATION REVOLVING $115,004 ~115,004 BAYPOINT LAGOONS ASSESSMENT DISTRICT $ 14,696 ~ 14,696 LIABILITIES AND FUND BALANCES Liabilities: Accounts payable $ 33,455 $ Due to other funds Deferred revenue Total Liabilities 33,455 Fund Balances: Reserved for: Encumbrances Loans Equipment Replacement Building and Structure Facility Closure Projects Liability payments Unreserved-Designated for: Library services Public safety Grant projects Parkland Construction 14,696 Traffic Mitigation Unreserved-Undesignated 81,549 Total Fund Balances 81,549 14,696 TOTAL LIABILITIES AND FUND BALANCES $115,004 ~ 14,696 4S PARKING SERVICES $ 131,018 9,879 ~ 140,897 $ 2,092 2,092 138,805 138,805 ~ 140,897 GAS TAX $1,284,175 3,287 ~1,287,462 $ 2,087 2,087 1,285,375 1,285,375 ~1,287,462 EQUIPMENT CIllLDCARE REPLACEMENT $ 474,417 $2,238,302 7 .. 654 $482,071 $2,238,302 $ 23,171 $ 37,267 23 .. 171 37 .. 267 68,840 459,808 390 .. 060 -1.741.227 458 .. 900 2,201.035 $ 482,071 $2,238.302 STREET MAINTENANCE & CLEANING $ 572,750 $ 572,750 $ 3,212 3 .. 212 24,089 545 .. 449 569 .. 538 $ 572,750 HOUSEHOLD SEWER HAZMAT MAINTENANCE FACILITY $ 6,962 6,442 L.ll..404 $ 250 250 13 .. 154 13 .. 154 L.ll..404 46 $ 321,489 154,288 $ 475,777 $140,042 140 .. 042 3,000 20,000 20,000 292,735 335 .. 735 $475,777 LOCH LOMOND ASSESSMENT DISTRICT $ 170,943 $ 170,943 $ 95,797 150,000 (74,854) 170 .. 943 $ 170,943 (C~ntinued) , 1 1 1 1 , I J t..:ITY OF SAN RAFAEL, CALIFORNIA ASSETS Cash and investments Accounts receivable Grants receivable Loans receivable Due from other funds TOTAL ASSETS SPECIAL REVENUE FUNDS COMBINING BALANCE SHEET JUNE 30, 1998 PUBLIC LIBRARY SAFETY $132,620 $ 22,490 18,572 16,802 $151.192 $ 39,292 LIABILITIES AND FUND BALANCES Liabilities: Accounts payable $ 3,193 $ 7,346 Due to other funds Deferred revenue -.llL000 Total Liabilities 120.193 7,346 Fund Balances: Reserved for: Encumbrances Loans Equipment Replacement Building and Structure Facility Closure Projects Liability payments Unreserved-Designated for: Library services 30,999 Public safety 31,946 Grant projects Parkland Construction Traffic Mitigation Unreserved-Undesignated Total Fund Balances 30,999 31,946 TOTAL LIABILITIES AND FUND BALANCES ~ 151,192 ~ 39,292 47 STORMWATER $ 401,470 $ 401,470 $ 26,083 26,083 375,387 375,387 ~ 401,470 TRAFFIC AND HOUSING MITIGATION $8,367,952 335,515 100,000 $8,803.467 $ 47,554 47,554 740 100,000 8,655,173 8,755,913 $8,803.467 DEVELOPMENT SERVICES $ 1,092,864 530 S 1.093.394 $ 23,006 23 .. 006 607,666 462.722 1.070388 S 1.093.394 GRANTS $ 172,890 176,053 9,782 S 358.725 $ 10,804 7,654 19s 204 37s 662 321,063 321.063 S 358.725 PARKLAND DEDICATION $ 959,845 21,726 57,000 S 1.038.571 $ 21 s726 21 s726 _ 1,016,845 1.016,845 S 1.038.571 48 TOTAL $ 16,479,887 743,094 9,782 100,000 64,654 S 17.397,417 $ 359,562 7,654 157s 930 525 • .146 553,477 100,000 3,000 20,000 20,000 703,463 150,000 30,999 324,681 321,063 1,016,845 1,675,458 8,655,173 3.298.112 16.872.271 S 17.397,417 (Concluded) 1 I I j J J j CITY OF SAN RAFAEL. CALIFORNIA SPECIAL REVENUE FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES FOR THE FISCAL YEAR ENDED JUNE 30, 1998 REVENUES: Taxes and special assessments Licenses and permits Fines and forfeitures Uses of money and property Intergovernmental Charges for current services Other revenues Total Revenues EXPENDITURES: General governmental Public safety Public works and parks Community development Culture and recreation Capital Outlay Total Expenditures EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES OTHER FINANCING SOURCES (USES): Operating transfers -In Operating transfers -Out Total Other Financing Sources (Uses) EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES AND OTHER SOURCES (USES) FUND BALANCES AT BEGINNING OF YEAR -~STATED FUND BALANCES AT END OF YEAR BAYPOINT LAGOONS RECREA nON ASSESSMENT PARKING REVOLVING DISTRICT SERVICES $ 801,619 5~249 806~868 1,408,172 2~255 1,410,427 (603,559) 685,108 685~108 81,549 .L..n.549 49 $ 27,290 27~290 29,681 29~681 (2,391) (2,391) 17~087 lli696 $ 130,999 6,230 593,442 !lli 730,578 128,924 462,536 77,232 668,692 61,886 (65,001) (65,001) (3,115) 141~920 ~805 $ GAS TAX 57,738 1,039,379 133 1,097,250 156~432 156,432 940,818 (350,000) (350,000) 590,818 694~558 $1,285,376 STREET HOUSEHOLD LOCH LOMOND EQUIPMENT MAINTENANCE & SEWER HAZMAT ASSESSMENT ClllLDCARE REPLACEMENT CLEANING MAINTENANCE FACILITY DISTRICT $ $ $ $ $ $ 59,605 17,583 20,284 102,201 10,889 12,000 23,956 18,054 22,075 4,831 88,593 2,007,024 700,594 637,920 719,171 12999 382 26A07 220452362 821 2372 342963 717,807 794,459 59,605 726,441 995,777 641,297 54 1,807,832 11 2381 806,646 95A27 8,190 1.819,213 8062646 1.091.204 641.297 7342631 54 226,149 14,726 (1.056,241) 76.510 592828 59.551 1,625,779 (63,356) 1,625 2779 (63,356) 226,149 14,726 569,538 13,154 59,828 59,551 232,,751 22 186,309 275,,907 111,,392 $ 458,900 $22 201 ,035 $ 569.538 .Ll1.154 t.1li.735 $ 170,943 (Continued) 50 1 'VtTY OF SAN RAF AELl CALIFORNlA , j SPECIAL REVENUE FUNDS 1 COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES FOR THE FISCAL YEAR ENDED JUNE 30, 1998 TRAFFIC AND I PUBLIC HOUSING LIBRARY SAFETY STORMWATER MITIGATION ~I REVENUES: Taxes and special assessments $ $ $ $ Licenses and permits J Fines and forfeitures 2,115 Uses of money and property 30,915 1,023 14,298 438,931 Intergovernmental 22,417 80,501 365,000 Charges for current services 4,887 5,496 655,031 753,455 Other revenues 10,024 6,418 255,538 Total Revenues 68,243 93,438 1,036,444 1,447,924 EXPENDITURES: Current: General governmental Public safety 31,074 Public works and parks 767,469 Community development Culture and recreation 77,693 Capital Outlay 75,130 1,131,083 281,995 Total Expenditures 77,693 106,204 1,898,552 281,995 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES (9,450) (12,766) (862,108) 1,165,929 OTHER FINANCING SOURCES (USES):' Operating transfers -In 4 556,070 Operating transfers -Out Total Other Financing Sources (Uses) 4 556,070 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES AND OTHER SOURCES (USES) (9,446) (12,766) (306,038) 1,165,929 FUND BALANCES AT BEGINNING OF YEAR -RESTATED 40,445 44,712 681,425 7589,984 FUND BALANCES AT END OF YEAR ~ 30,999 ~ 31,946 ~ 375,387 ~8,755,913 51 DEVELOPMENT PARKLAND SERVICES GRANTS DEDICATION TOTAL $ $ $ $ 86,895 148,582 2,115 59,912 8,395 50,112 836,884 504,685 2,145,535 357,708 56,220 6,573,396 192.219 29.119 162.933 1.409.499 609.839 598.419 213.045 11.202.906 128,924 259,801 1,479,852 167,027 10,515 2,689,052 412,959 412,959 219,321 3,513,018 18.920 350.960 2.938.419 412.959 665.069 361.475 11.162.224 196.880 (66.650) (148.430) 40.682 120,000 2,986,961 (4) (20.000) (498.361) 119.996 (20.000) 2.488.600 196,880 53,346 (168,430) 2,529,282 873 .. 507 267 .. 717 1.185.275 14.342.989 $ 1.070.387 $ 321.063 $ 1.016.845 $ 16.872.271 52 LITY OF SAN RAFAEL! CALIFORNIA RECREATION REVOLVING FUND I STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET (GAAP BASIS) AND ACTUAL 1 FOR THE FISCAL YEAR ENDED JUNE 30, 1998 VARIANCE 1 FAVORABLE BUDGET ACTUAL (UNFAVORABLE) REVENUES: Charges for current services $752,192 $ 801,619 $ 49,427 Other revenues 2,600 5,249 2,649 Total Revenues 754,792 806,868 52,076 EXPENDITURES: Culture and recreation 1,458,565 1,408,172 50,393 Capital outlay 4,000 2,255 1.745 Total Expenditures 1,462,565 1,410,427 52.138 EXCESS (DEFICIENCy) OF REVENUES OVER (UNDER) EXPENDITURES (707,773) (603,559) 104,214 I OTHER FINANCING SOURCES (USES): Operating transfers -In 685,000 685.108 108 J Total Other Financing Sources (Uses) 685,000 685.108 108 EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES AND OTHER SOURCES (USES) $ (22,773) 81,549 $104.322 FUND BALANCES AT BEGINNING OF 1 YEAR -RESTATED FUND BALANCES AT END OF YEAR L.ll.549 J 53 CITY OF SAN RAFAEL. CALIFORNIA BA YPOINT LAGOONS ASSESSMENT DISTRICT FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET (GAAP BASIS) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 1998 VARIANCE FAVORABLE BUDGET ACTUAL (UNFAVORABLE) REVENUES: Taxes and special assessments Total Revenues EXPENDITURES: Public works and parks Total Expenditures EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES FUND BALANCES AT BEGINNING OF YEAR -RESTATED FUND BALANCES AT END OF YEAR ~576 27,..576 24 .. 500 24 .. 500 $ 3,076 54 UL290 $ (286) 27 .. 290 (286) 29 .. 681 (5.181) 29 .. 681 (5.181) (2,391) $ (5.467) 17,087 $ 14,696 LITY OF SAN RAFAEL.! CALIFORNIA PARKING SERVICES FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET (GAAP BASIS) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 1998 VARIANCE ~ 1 FAVORABLE BUDGET ACTUAL (UNFAVORABLE) REVENUES: Licenses and permits $636,575 $130,999 $ (505,576) Uses of money and property 14,000 6,230 (7,770) Charges for current services 596,442 593,442 Other revenue (93) (93) Total Revenues 650,575 730,578 80,003 EXPENDITURES: General government 197,524 128,924 68,600 Public safety 464,261 462,536 1,725 Public works and parks 80,548 77,232 3,316 Total Expenditures 742,333 668,692 73,641 EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES (91~758) 61~886 153~644 J OTHER FINANCING SOURCES (USES): Operating transfers -Out (65,00n (65,00n Total Other Financing Sources (Uses) (65,00n (65,00n EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES AND OTHER SOURCES (USES) $(156,759) (3,115) ~644 FUND BALANCES AT BEGINNING OF YEAR -RESTATED 141~920 FUND BALANCES AT END OF YEAR ~805 S5 CITY OF SAN RAFAEL" CALIFORNIA GAS TAX FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET (GAAP BASIS) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 1998 VARIANCE r 1 FAVORABLE BUDGET ACTUAL (UNFAVORABLE) REVENUES: Uses of money and property $ 36,000 $ 57,738 $ 21,738 Intergovernmental 1,159,853 1,039,379 (120,474) Other revenue 133 133 Total Revenues 1,195,853 1.097,250 (98,603) EXPENDITURES: Current: Public works and parks 1.228,371 156,432 1,071,939 Total Expenditures 1.228,371 156,432 1.071.939 EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES (32.518) 940,818 973.336 OTHER FINANCING SOURCES (USES): Operating transfers -Out (350,000) (350,000) Total Other Financing Sources (Uses) (350,000) (350,000) EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES AND OTHER SOURCES (USES) $ (382,518) 590,818 $ 973.336 FUND BALANCES AT BEGINNING OF YEAR -RESTATED 694 .. 558 FUND BALANCES AT END OF YEAR $1.285,376 56 L~TY OF SAN RAFAELl CALIFORNlA CHILDCARE FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET (GAAP BASIS) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 1998 VARIANCE FAVORABLE BUDGET ACTUAL (UNFAVORABLE) REVENUES: Uses of money and property $ 4,000 $ 20,284 $ 16,284 Intergovernrnenuu 10,400 18,054 7,654 Charges for current services 1,900,060 2,007,024 106,964 Touu Revenues 1,914,460 2,045,362 130,902 EXPENDITURES: Culture and recreation 1,803,252 1,807,832 (4,580) Capiuu Outlay 85,700 11,381 74,319 Touu Expenditures 1,888,952 1.819,213 69,739 EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES 25,508 226.149 200,641 OTHER FINANCING SOURCES (USES): Operating transfers -In 6,000 (6,000) . J Touu Other Financing Sources (Uses) 6,000 (6,000) ] EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES j AND OTHER SOURCES (USES) $ 31,508 226,149 il2.4..641 FUND BALANCES AT BEGINNING OF ) YEAR -RESTATED 232,751 ] FUND BALANCES AT END OF YEAR $ 458,900 57 CITY OF SAN RAFAEL. CALIFORNIA EQUIPMENT REPLACEMENT FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET (GAAP BASIS) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 1998 VARIANCE FAVORABLE BUDGET ACTUAL (UNFAVORABLE) REVENUES: Uses of money and property Other revenue Total Revenues EXPENDITURES: Capital outlay Total Expenditures EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES FUND BALANCES AT BEGINNING OF YEAR -RESTATED FUND BALANCES AT END OF YEAR $ 110,000 $ 102,201 716,056 719,171 826,056 821.372 1.523,751 806 .. 646 1.523,751 806 .. 646 $ (697,695) 14,726 2,186.309 $2,201.035 58 $ (7,799) 3,115 (4,684) 717 .. 105 717 .. 105 $712.421 1 J 1 J I ,--lTv OF SAN RAFAEL, CALIFORNiA STREET MAINTENANCE & CLEANING FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET (GAAP BASIS) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 1998 BUDGET ACTUAL REVENUES: Uses of money and property $ $ 10,889 Intergovernmental 22,075 Other revenues 1.999 Total Revenues 34,963 EXPENDITURES: Public works and parks 930,002 995,777 Culture & recreation Capital outlay 975,000 95,427 Total Expenditures 1,905,002 1,091.204 EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES (1,905,002) (1,056,241) OTHER FINANCING SOURCES (USES): Operating transfers -In 1.625.779 1.625.779 Total Other Financing Sources (Uses) 1.625.779 1.625.779 EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES AND OTHER SOURCES (USES) $ (279.223) 569,538 FUND BALANCES AT BEGINNING OF YEAR -RESTATED FUND BALANCES AT END OF YEAR $569538 59 VARIANCE FAVORABLE (UNFAVORABLE) $ 10,889 22,075 1.999 34,963 (65,775) 879,573 813,798 848,761 $ 848.761 CITY OF SAN RAFAEL, CALIFORNIA SEWER MAINTENANCE FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET (GAAP BASIS) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 1998 VARIANCE FAVORABLE BUDGET ACTUAL (UNFAVORABLE) REVENUES: Uses of money and property Intergovernmental Charges for current services Other revenues Total Revenues EXPENDITURES: Public works and parks Total Expenditures EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES OTHER FINANCING SOURCES (USES): Operating transfers -Out Total Other Financing Sources (Uses) EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES AND OTHER SOURCES (USES) FUND BALANCES AT BEGINNING OF YEAR -RESTATED FUND BALANCES AT END OF YEAR $ 689,984 689,984 783 .. 484 783 .. 484 (84,500) (63356) (63356) $047,856) 60 $ 12,000 $ 12,000 4,831 4,831 700,594 1,610 382 382 717,807 18,823 641 .. 297 142 .. 187 641 .. 297 142 .. 187 (76.510) 161 .. 010 (63.356) (63356) 13,154 $ 161.010 $ 13.154 LITY OF SAN RAFAEL1 CALIFORNlA HOUSEHOLD HAZMAT FACILITY FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET (GAAP BASIS) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 1998 VARIANCE 1 FAVORABLE BUDGET ACTUAL CUNF A VORABLE) REVENUES: Licenses and pennits $ $ 17,583 $ 17,583 Uses of money and property 10,000 23,956 13,956 Intergovernmental 37,354 88,593 51,239 Charges for current services 644,471 637,920 (6,551) 1 Other revenues 37,000 26,407 (10.593) Total Revenues 728,825 794,459 65,634 EXPENDITURES: Public safety 676,181 726,441 (50,260) Capital outlay 32,604 8,190 24,414 Total Expenditures 708,785 734,631 (25,846) EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES AND OTHER SOURCES (USES) $ 20,040 59,828 Ll2.,788 FUND BALANCES AT BEGINNING OF j YEAR -RESTATED 275,907 FUND BALANCES AT END OF YEAR ~735 1 - 61 CITY OF SAN RAFAEL. CALIFORNIA LOCH LOMOND ASSESSMENT DISTRICT STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET (GAAP BASIS) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 1998 BUDGET ACTUAL REVENUES: Taxes and special assessments $ 58,800 $ 59,605 Total Revenues 58,800 59,605 EXPENDITURES: Public works and parks 5,000 54 Total Expenditures 5,000 54 EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES AND OTHER SOURCES (USES) $ 53,800 59.551 FUND BALANCES AT BEGINNING OF YEAR -RESTATED 111~392 FUND BALANCES AT END OF YEAR ~943 62 VARIANCE FAVORABLE (UNFAVORABLE) $ 805 805 4,946 4,946 L..i.751 J J I ~ I ~ J 1 1 } J 1 } , 1 1 J } I LITY OF SAN RAFAEL. CALIFORNIA LIBRARY FUND STATEMENT OF REVENUES, EXPENDITIJRES AND CHANGES IN FUND BALANCES BUDGET (GAAP BASIS) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 1998 VARIANCE FAVORABLE BUDGET ACTUAL (UNFAVORABLE) REVENUES: Uses of money and property Intergovernmental Charges for current services Other revenues Total Revenues EXPENDITURES: Culture and recreation Capital outlay Total Expenditures EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES OTHER FINANCING SOURCES (USES): Operating transfers -In Total Other Financing Sources (Uses) EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES AND OTHER SOURCES (USES) FUND BALANCES AT BEGINNING OF YEAR -RESTATED FUND BALANCES AT END OF YEAR $ 28,900 7~500 36 .. 400 35,032 10 .. 000 45 .. 032 (8,632) $ (8.632) 63 $30,915 22,417 4,887 10,024 68.243 77,693 77 .. 693 (9.450) 4 4 (9,446) 40.445 $30.999 $ 2,015 22,417 4,887 2.524 31.843 (42,661) 10 .. 000 (32,661) illID 4 4 $ (814) LITY OF SAN RAFAEL, CALIFORNlA PUBLIC SAFETY FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET (GAAP BASIS) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 1998 REVENUES: Uses of money and property Intergovernmental Charges for current services Other revenues Total Revenues EXPENDITURES: Public safety Capital outlay Total Expenditures EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES AND OTHER SOURCES (USES) FUND BALANCES AT BEGINNING OF YEAR -RESTATED FUND BALANCES AT END OF YEAR BUDGET $ 800 60,000 9,700 50 70,550 42,228 55.367 97,595 $(27,045) 64 ACTUAL $ 1,023 80,501 5,496 6A18 93.438 31,074 75.130 106,204 (12,766) 44,712 $ 31.946 VARIANCE FAVORABLE (UNFAVORABLE) $ 223 20,501 (4,204) 6.368 22,888 11,154 (19.763) (8,609) $14.279 I LJTY OF SAN RAFAEL! CALIFORNIA STORMWATERFUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET (GAAP BASIS) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 1998 VARIANCE FAVORABLE BUDGET ACTUAL (UNFAVORABLE) 1 REVENUES: Fines and forfeitures $ $ 2,115 $ 2,115 Uses of money and property 8,400 14,298 5,898 Intergovernmental 363,559 365,000 1,441 Charges for current services 655,270 655,031 (239) Other revenue Total Revenues 1,027,229 1,036,444 9,215 EXPENDITURES: Public works and parks 756,944 767,469 (10,525) Capital outlay 1,382,468 1.131,083 251.385 Total Expenditures 2.139,412 1,898,552 240,860 EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES (1.112.183) (862,108) 250,075 1 OTHER FINANCING SOURCES (USES) Operating transfers -In 556,070 556,070 .; TOTAL OTHER FINANCING SOURCES (USES) 556,070 556,070 EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES AND OTHER SOURCES (USES) $ (556.113) (306,038) $250,075 FUND BALANCES AT BEGINNING OF YEAR -RESTATED 681,425 FUND BALANCES AT END OF YEAR $ 375,387 65 CITY OF SAN RAFAEL, CALIFORNIA TRAFFIC AND HOUSING MITIGATION FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET (CASH BASIS) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 1998 VARIANCE FAVORABLE BUDGET ACTUAL (UNFAVORABLE) REVENUES: Uses of money and property Charges for current services Other revenues Total Revenues EXPENDITURES: Capital outlay Total Expenditures EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES FUND BALANCES AT BEGINNING OF YEAR -RESTATED FUND BALANCES AT END OF YEAR $ 401,000 $ 438,931 753,455 240,000 255,538 641,,000 1.447,924 4,250,739 281,,995 4,250,739 281,,995 $(3,609,739) 1,165,929 7,589,984 $ 8,755,913 66 $ 37,931 753,455 15,,538 806,,924 3,968,744 3,968,744 $4,775,668 \ 1 1 ] 1 I 1 1 , ! J \ J J 1 L f TY OF SAN RAFAEL. CALIFORNIA DEVELOPMENT SERVICES FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET (GAAP BASIS) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 1998 REVENUES: Uses of money and property Charges for current services Other revenue Total Revenues EXPENDITURES: General government Total Expenditures EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES AND OTHER SOURCES (USES) FUND BALANCES AT BEGINNING OF YEAR -RESTATED FUND BALANCES AT END OF YEAR BUDGET $ 75,000 228 .. 000 303 .. 000 344 .. 000 344 .. 000 $ (41.000) 67 ACTUAL $ 59,912 357,708 192 .. 219 609 .. 839 412 .. 959 412 .. 959 196,880 873.507 $1.070,387 VARIANCE FAVORABLE (UNFAVORABLE) $ 59,912 282,708 (35,781) 306 .. 839 (68,959) (68,959) $237,880 CITY OF SAN RAFAEL. CALIFORNIA GRANTS FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET (GAAP BASIS) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 1998 REVENUES: Uses of money and property Intergovernmental Charges for current services Other revenues Total Revenues EXPENDITURES: Public safety Public works and parks Culture and recreation Capital outlay Total Expenditures EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES OTHER FINANCING SOURCES (USES): Operating transfers -In Operating transfers -Out Total Other Financing Sources (Uses) EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES AND OTHER SOURCES (USES) FUND BALANCES AT BEGINNING OF YEAR -RESTATED FUND BALANCES AT END OF YEAR BUDGET $ 2,750 1,139,761 54,500 1.197.011 256,638 38,234 423,513 675.603 1.393.988 (196.977) 120,000 (6.000) 114,.000 $ (82.977) 68 ACTUAL $ 8,395 504,685 56,220 29.119 598.419 259,801 167,027 219,321 18.920 665.069 (66.650) 120,000 ill 119,.996 53,346 267.717 $321.063 VARIANCE FAVORABLE (UNFAVORABLE) $ 5,645 (635,076) 56,220 (25.381) (598.592) (3,163) (128,793) 204,192 656.683 728.919 130,.327 5,.996 5,.996 $136,323 1 J I } , J 1 1 1 1 J j I t;ITY OF SAN RAFAEL. CALIFORNIA PARKLAND DEDICATION FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET (GAAP BASIS) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 1998 REVENUES: Uses of money and property Other revenues Total Revenues EXPENDITURES: Public works and parks Capital outlay Total Expenditures EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES OTHER FINANCING SOURCES (USES): Operating transfers -Out Total Other Financing Sources (Uses) EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES AND OTHER SOURCES (USES) FUND BALANCES AT BEGINNING OF YEAR -RESTATED FUND BALANCES AT END OF YEAR BUDGET $ 54,810 54~81O 10,515 581 .. 598 592 .. 113 (537.303) (20,000) (20,000) $ ACTUAL 50,112 162~933 213~045 10,515 350 .. 960 361 .. 475 (148,430) (20,000) (20,000) $(557,303) (168,430) 69 1,185,275 $ 1,016,845 VARIANCE FAVORABLE (UNFAVORABLE) $ (4,698) 162~933 158~235 230 .. 638 230 .. 638 388 .. 873 $388,873 CITY OF SAN RAFAEL, CALIFORNIA ASSETS Cash and investments Cash with fiscal agent Assessments receivable -deferred TOTAL ASSETS DEBT SERVICE FUNDS COMB~GBALANCESHEET JUNE 30, 1998 EAST FRANCISCO BOULEVARD ASSESSMENT DISTRICT $ 13,701 .L!l.701 LIABILITIES AND FUND BALANCES Liabilities: Deferred revenue Total Liabilities Fund Balances: Reserved for debt service Unreserved: Designated for construction Total Fund Balances TOTAL LIABILITIES AND FUND BALANCES $ 13,.701 13,701 ~ 13,701 70 PEACOCK GAP ASSESSMENT DISTRICT $ 523,043 265,.710 $ 788,753 $ 265,710 265,710 523,043 523,043 ~ 788,753 $ 1915 ACT BONDS 69,264 19,.025 U!,289 $ 19,025 19,025 69,264 69,264 ~ 88,289 ] 1 1 } J 1 MARIPOSA ASSESSMENT DISTRICT $ 39,429 22,376 $ 61,805 $ 22,376 22,376 39,429 39,429 $ 61,805 L1TY OF SAN RAFAEL, CALIFORNIA DEBT SERVICE FUNDS COMB~GBALANCESHEET JUNE 30, 1998 1997 1997 FINANCING REASSESSMENT AUTHORITY 1992 AGENCY REFUNDING BONDS DISTRICT REVENUE BONDS $ $ 607,430 $ 2,397 340,762 12 695,856 ~ 2,397 ~ 1,644,048 $ 12 $ $ 695,856 $ 695,856 2,397 948,192 12 2,397 948,192 12 $ 2,397 $ 1,644,048 $ 12 71 $ 1995 AGENCY BONDS 631,473 ~ 631,473 $ 631,473 631,473 $ 631,473 $ $ $ $ TOTAL 1,183,603 1,043,908 1,002,967 3,230,478 1,002,967 1,002,967 2,213,810 13.701 2,227,511 3,230,478 CITY OF SAN RAFAEL. CALIFORNIA DEBT SERVICE FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES FOR THE FISCAL YEAR ENDED JUNE 30, 1998 REVENUES: Taxes and special assessments Uses of money and property Total Revenues EXPENDITURES: Principal retirement Interest and fiscal charges Total Expenditures EXCESS (DEFICIENCy) OF REVENUES OVER (UNDER) EXPENDITURES OTHER FINANCING SOURCES (USES): Operating transfers -In Operating transfers -Out Total Other Financing Sources (Uses) EXCESS (DEFICIENCy) OF REVENUES AND OTIIER FINANCING SOURCES OVER (UNDER) EXPENDITURES AND OTHER FINANCING SOURCES (USES) FUND BALANCES AT BEGINNING OF YEAR FUND BALANCES AT END OF YEAR EAST FRANCISCO BOULEVARD ASSESSMENT DISTRICT $ 13 .. 701 lli..701 72 PEACOCK GAP ASSESSMENT DISTRICT $ 312,836 21 .. 097 333,933 160,000 95 .. 477 255.477 78 .. 456 (5,676) (5,676) 72,780 450 .. 263 Ull,,043 1915 ACT BONDS $ 32,109 32,109 31,000 431 31.431 678 678 68 .. 586 .L§2..264 LfTY OF SAN RAFAEL! CALIFORNIA DEBT SERVICE FUNDS 1 COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES } FOR THE FISCAL YEAR ENDED JUNE 30, 1998 1997 1992 MARIPOSA 1997 FINANCING AGENCY 1995 ASSESSMENT REASSESSMENT AUTHORITY REFUNDING AGENCY DISTRICT DISTRICT REVENUE BONDS BONDS BONDS TOTAL $ 22,448 $ $ 786,166 $ 1,423,045 $ 626,895 $ 3,203,499 1,716 15,448 1,206 528 39,995 24,164 801.614 1.424,251 627.423 3,243,494 10,000 20,000 405,000 175,000 801,000 13,650 321.430 1,020,907 457.595 1.909,490 23,650 341.430 1,425,907 632,595 2,710,490 514 460,184 (1,656) (5,172) 533,004 2,568 5,017 7,585 (352) (10,868) (16,896) (352) (10,868) 2.568 5,017 (9,311) 162 449,316 912 (155) 523,693 , l 39,267 2,397 498,876 (900) 631,628 1.703,818 $ 39,429 $ 2,397 $ 948,192 $ 12 $ 631.473 $ 2,227,511 1 73 CITY OF SAN RAFAEL, CALIFORNIA PEACOCK GAP ASSESSMENT DISTRICT FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET (GAAP BASIS) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 1998 VARIANCE FAVORABLE BUDGET ACTUAL (UNFAVORABLE) REVENUES: Taxes and special assessment $267,000 $312,836 $45,836 Uses of money and property 19.500 21,097 1,597 Total Revenues 286,500 333,933 47.433 EXPENDITURES: Principal retirement 160,000 160,000 Interest and fiscal charges 100,062 95.477 4.585 Total Expenditures 260,062 255.477 4.585 EXCESS (DEFICIENCy) OF REVENUES OVER (UNDER) EXPENDITURES 26.438 78.456 52,018 OTHER FINANCING SOURCES (USES) Operating transfers -Out (2,838) (5,676) (2,838) Total Other Financing Sources (Uses) (2,838) (5,676) (2,838) EXCESS (DEFICIENCy) OF REVENUES AND OTHER FINANCING SOURCES OVER (UNDER) EXPENDITURES AND OTHER FINANCING SOURCES (USES) $ 23,600 72,780 $49.180 FUND BALANCES AT BEGINNING OF YEAR 450~263 FUND BALANCES AT END OF YEAR $523,043 74 I 1 1 ] L1TY OF SAN RAFAEL. CALIFORNIA 1915 ACT BONDS FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET (GAAP BASIS) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 1998 REVENUES: Taxes and special assessment Total Revenues EXPENDITURES: Principal retirement Interest and fiscal charges Total Expenditures EXCESS (DEFICIENCy) OF REVENUES OVER (UNDER) EXPENDITURES AND OTHER FINANCING SOURCES (USES) FUND BALANCES AT BEGINNING OF YEAR FUND BALANCES AT END OF YEAR BUDGET ~500 i 75 31~500 25,000 6~500 31~500 VARIANCE FAVORABLE ACTUAL (UNFAVORABLE) t]1..109 32~109 31,000 431 3t431 678 68,586 $69,264 i 609 609 (6,000) 6~069 69 $ 678 CITY OF SAN RAFAEL. CALIFORNIA MARIPOSA ASSESSMENT DISTRICT FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET (GAAP BASIS) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 1998 REVENUES: Taxes and special assessment Uses of money and property Total Revenues EXPENDITURES: Debt Service: Principal retirement Interest and fiscal charges Total Expenditures . EXCESS (DEFICIENCy) OF REVENUES OVER (UNDER) EXPENDITURES OTHER FINANCING SOURCES (USES): Operating transfers -Out Total Other Financing Sources (Uses) EXCESS (DEFICIENCy) OF REVENUES AND OTHER FINANCING SOURCES OVER (UNDER) EXPENDITURES AND OTHER FINANCING USES FUND BALANCES AT BEGINNING OF YEAR FUND BALANCES AT END OF YEAR BUDGET $ 23,000 1,,750 24,,750 10,000 13,,235 23 .. 235 1 .. 515 (176) (176) $ 1.339 76 VARIANCE FAVORABLE ACTUAL (UNFAVORABLE) $ 22,448 1,,716 24,,164 10,000 13,,650 23,,650 514 (352) (352) 162 39,266 $ 39.428 $ (552) (34) (586) (415) (415) (1,001) (176) (176) $ (1.177) I LITY OF SAN RAFAEL! CALIFORNIA 1997 FINANCING AUTHORITY REVENUE BONDS FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET (GAAP BASIS) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 1998 VARIANCE FAVORABLE BUDGET ACTUAL (UNFAVORABLE) REVENUES: Taxes and special assessment $ 433,900 $ 786,166 $ 352,266 Uses of money and property 32,000 15.448 Cl6,552) Total Revenues 465,900 801,614 335,714 EXPENDITURES: Principal retirement 20,000 (20,000) Interest and fiscal charges 352,938 321,430 31,508 Total Expenditures 352,938 341,430 11,508 EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES 112,962 460,184 347,222 OTHER FINANCING SOURCES (USES): Operating transfers -Out (5.434) ClO,868) (5.434) Total Other Financing Sources (Uses) (5.434) (10,868) (5.434) EXCESS (DEFICIENCy) OF REVENUES AND OTHER FINANCING SOURCES 1 OVER EXPENDITURES AND OTHER FINANCING USES $ 107,528 449,316 $ 341,788 J FUND BALANCES AT BEGINNING OF YEAR 498,876 1 FUND BALANCES AT END OF YEAR $ 948,192 77 CITY OF SAN RAFAEL. CALIFORNIA 1992 AGENCY REFUNDING BONDS FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET (GAAP BASIS) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 1998 REVENUES: Taxes and special assessment Uses of money and property Total Revenues EXPENDITURES: Principal retirement Interest and fiscal charges Total Expenditures EXCESS (DEFICIENCy) OF REVENUES OVER (UNDER) EXPENDITURES OTHER FINANCING SOURCES (USES): Operating transfers -In Total Other Financing Sources (Uses) EXCESS (DEFICIENCy) OF REVENUES AND OTHER FINANCING SOURCES OVER (UNDER) EXPENDITURES BUDGET $1,413,614 15.1900 1.429,514 405,000 1.023,614 1,428,614 900 AND OTHER FINANCING USES $ 900 FUND BALANCES AT BEGINNING OF YEAR FUND BALANCES AT END OF YEAR 78 VARIANCE FAVORABLE ACTUAL (UNFAVORABLE) $1,423,045 1.1206 i 1,424,251 405,000 1.020,907 1,425,907 (1.656) 2.1 568 2.1 568 912 (900) 12 $ 9,431 04,694) (5,263) 2.1707 2.1707 (2,556) 2.1 568 2.1 568 i 12 l lTV OF SAN RAF AELl CALIFORN~ A 1995 AGENCY REFUNDING BONDS FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET (GAAP BASIS) AND ACTUAL FOR THE FISCAL YEAR ENDED JUNE 30, 1998 , VARIANCE I FAVORABLE BUDGET ACTUAL (lJNF A VORABLE) I REVENUES: Taxes and special assessment $623,577 $ 626,895 $ 3,318 Uses of money and property 9,000 528 (8.472) Total Revenues 632,577 627.423 (5.154) EXPENDITURES: Principal retirement 175,000 175,000 Interest and fiscal charges 457.578 457,595 (17) Total Expenditures 632.578 632.595 (17) EXCESS (DEFICIENCy) OF REVENUES OVER (UNDER) EXPENDITURES (n (5.172) (5.171) OTHER FINANCING SOURCES (USES): Operating transfers -In 5,017 5,017 Total Other Financing Sources (Uses) 5,017 5,017 EXCESS (DEFICIENCy) OF REVENUES AND OTHER FINANCING SOURCES OVER (UNDER) EXPENDITURES AND OTHER FINANCING USES $ (1) (155) $ (154) FUND BALANCES AT BEGINNING OF YEAR 631,,628 FUND BALANCES AT END OF YEAR $ 631,473 79 ASSETS Cash and investments Accounts receivable Taxes receivable Interest receivable Loans receivable Due from other funds Land held for resale ~fTY OF SAN RAFAEL, CALIFORl\_a'i. CAPITAL PROJECTS FUNDS COMBnuNGBALANCESHEET JUNE 30, 1998 CAPITAL OPEN SPACE IMPROVEMENT $ 505,648 $1,247,814 TOTAL ASSETS ~ 505,648 $1,247,814 LIABILITIES AND FUND BALANCES Liabilities: Accounts payable $ $ 822 Due to other funds Deposits Deferred revenue Total Liabilities 822 Fund Balances: Reserved for: Encumbrances Loans Projects 1,195,079 Land held for resale Unreserved: Designated for: Redevelopment Construction 505,648 51,913 Undesignated Total Fund Balances 505,648 1,246,992 TOTAL LIABILITIES AND FUND BALANCES ~ 505,648 ~ 1,247,814 80 BEDROOM ASSESSMENT TAX DISTRICTS $ 102,404 $ 584,156 13,020 12,024 34,845 ~ 150,269 ~ 596,180 $ $ 70,965 13~020 13,020 70,965 34,845 102,404 525,215 137,249 525,215 ~ 150,269 ~ 596,180 J ) ) I ~ LOW AND 1 PARK 1985 CAPITAL MODERATE 1992 BONDS 1995 BONDS CAPITAL PROJECT AND INCOME CAPITAL CAPITAL ~ROJECTS ADMINISTRA nON HOUSING PROJECT PROJECT TOTAL 1 $ 96,362 $ 82,245 $ 365,834 $ 483,466 $3,905,786 $ 7,373,715 117,000 15,255 989,459 1,146,758 439,444 439,444 62,627 11,807 74,434 343,659 343,659 1,150,199 518,438 1,703,482 2,004,514 2,004,514 ~ 213,362 ~2,086,759 ~2,377,018 ~ 1,472,925 ~4,436,031 ~ 13,086,006 $ $ 21,443 $ 3,280 $ 915,001 $ 13,011 $ 1,024,522 91,845 1,150,199 518,438 1,760,482 100,000 100,000 57,000 70,020 148,845 1,271,642 3,280 1,433,439 13,011 2,955,024 404 5,536 5,940 343,659 378,504 522,243 2,348,500 4,065,822 2,004,514 2,004,514 64,517 1,507,836 33,950 2,074,520 4,866,003 (1,189,801) (1,189,801) 1 64,517 815,117 2,373,738 39,486 4,423,020 10,130,982 1 ~ 213,362 ~2,086,759 ~2,377,018 ~ 1,472,925 ~4,436,031 ~ 13,086,006 81 CITY OF SAN RAFAEL, CALIFORNIA CAPITAL PROJECTS FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES FOR THE FISCAL YEAR ENDED JUNE 30, 1998 CAPITAL BEDROOM OPEN SPACE IMPROVEMENT TAX REVENUES: Taxes and special assessments $ $ $ 33,714 Uses of money and property 26,210 67,724 Intergovernmental Charges for current services Other revenues 6~000 Total Revenues 26,210 67,724 39,714 EXPENDITURES: Community development Culture and recreation 34,461 Capital Outlay 19,677 Total Expenditures 19,677 34.461 EXCESS (DEFICIENCy) OF REVENUES OVER (UNDER) EXPENDITURES 26,210 48,047 5,253 OTHER FINANCING SOURCES (USES): Operating transfers -In Operating transfers -Out Total Other Financing Sources (Uses) EXCESS (DEFICIENCy) OF REVENUES OVER (UNDER) EXPENDITURES AND OTHER SOURCES (USES) 26,210 48,047 5,253 FUND BALANCES AT BEGINNING OF YEAR -RESTATED 479,438 1,198,945 131.996 FUND BALANCES AT END OF YEAR $ 505.648 $1.246.992 $137.249 82 l ASSESSMENT DISTRICTS $ 12,024 12,024 233,339 233,339 I. J (221,315) 20,473 20.473 (200,842) 726,057 $ 525.215 I ) ) CITY OF SAN RAFAEL. CALIFORNIA INTERNAL SERVICE FUNDS COMB~GBALANCESHEET JUNE 30, 1998 LIABILITY WORKERS' DENTAL INSURANCE COMPENSATION INSURANCE TOTAL Assets: Cash and investments $ 859,972 $ 1,265,839 $ 57,187-$ 2,182,998 Total Assets $ 859,972 $ 1,265,839 $ 57,187 $ 2,182,998 Liabilities and Retained Earnings Liabilities: Accounts payable $ 8,049 $ 5,575 $ $ 13,624 Claims payable 805,634 1.103.107 1.908,741 Total Liabilities 813,683 1,108,682 1,922.365 Retained Earnings: Unreserved: Designated for insurance premiums and claims 46,289 157.157 57.187 260,633 Total Retained Earnings 46,289 157.157 57.187 260,633 Total Liabilities and Retained Earnings $ 859,972 $ 1,265,839 $ 57,187 $ 2,182,998 84 ~.tTY OF SAN RAFAEL.t CALIFO~.I.A INTERNAL SERVICE FUNDS COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN RETAINED EARNINGS FOR THE FISCAL YEAR ENDED JUNE 30, 1998 I LIABILITY WORKERS' DENTAL INSURANCE COMPENSA nON INSURANCE TOTAL 1 Operating Revenues: 1 Charges for current services $ 558,845 $ 691,478 $184,606 $ 1.434,929 Total Operating Revenues 558,845 691,478 184,606 1.434,929 Operating Expenses: Insurance premiums and claims 910,904 611,390 127.419 1,649,713 Total Operating Expenses 910,904 611,390 127.419 1,649,713 Operating Income (Loss) (352,059) 80,088 57.187 (214,784) Non-Operating Revenues: Investment income 34,788 70,214 105,002 Refunds 151,060 6,855 157,915 Operating transfers -In 212,500 212,500 Total Non-Operating Revenues 398,348 77,069 475.417 Net Income 46,289 157,157 57,187 260,633 Retained Earnings at beginning of year Retained Earnings at end of year $ 46,289 $ 157,157 $ 57,187 $ 260,633 ] 85 CITY OF SAN RAFAEL, CALIFORNIA INTERNAL SERVICE FUNDS COMBININGSTATEMrnNTOFCASHFLOWS FOR THE FISCAL YEAR ENDED JUNE 30, 1998 LIABILITY WORKERS' DENTAL INSURANCE COMPENSA nON INSURANCE TOTAL Cash Flows From Operating Activities: Operating Income (Loss) $ (352,059) $ 80,088 $ 57,187 $ (214,784) Change in Assets and Liabilities: Increase in accounts payable 8,049 5,575 13,624 Increase (Decrease) in contract payable Net Cash Provided By (Used for) Operating Activities (344,010) 85,663 57,187 (201,160) Cash Flows from Non-Capital Financing Activities: Proceeds from assumption of liabilities 805,634 1,103,107 1,908,741 Refunds received 151,060 6,855 157,915 Operating transfers -In from other funds 212,500 212,500 Net Cash Provided By Non-Capital Financing 1,169,194 1,109,962 2,279,156 Cash Flows from Investing Activities: Interest and dividends on investments 34.788 70.214 105,.002 Net Cash Provided By Investing Activities 34.788 70.214 105.002 Net Increase (Decrease) in Cash and Cash Equivalents 859,972 1,265,839 57,187 2,182,998 Cash and Cash Equivalents at Beginning of Year Cash and Cash Equivalents at End of Year ~ 859.972 ~ 1.265.839 ~ 57.187 ~ 2.182.998 86 I 1 J 1 J J ,-,lTV OF SAN RAFAEL. CALIFORNiA. ASSETS Cash and investments Restricted cash TOTAL ASSETS LIABILITIES AND FUND EQUITY LIABILITIES: Deferred compensation payable Total Liabilities FUND BALANCES: Reserved for: Petty cash Unreserved: Designated for projects Total Fund Balances TRUST AND AGENCY FUNDS COMBINING BALANCE SHEET JUNE 30, 1998 AGENCY FUND EXPENDABLE TRUST FUNDS DEFERRED BUSINESS NEIGHBORHOOD COMPENSATION IMPROVEMENT TRUST $ $ 6,760 $ 11.496,347 $ 11,496,347 ~760 i $ 11,496,347 i i 11.496,347 3,000 3~760 6~760 TOTAL LIABILITIES AND FUND EQUITY $ 11,496,347 ~760 i 87 CITY OF SAN RAFAEL. CALIFORNIA TRUST AND AGENCY FUNDS COMBINING BALANCE SHEET JUNE 30, 1998 EXPENDABLE TRUST FUNDS LIBRARY FIDICIARY $ 392,069 $ 392,069 ~ 392,,069 392,,069 $ 392,069 RECREATION FIDUCIARY $ 28,704 ~ 28 • .704 ~ 28,,704 28,,704 ~ 28,,704 TOTAL $ 427,533 11.496,347 $ 11.923,880 $ 11.496,347 11,496,347 3,000 424,,533 427,,533 $ 11,923,880 88 J I 1 1 ) I , I I J 1 J I l..lTY OF SAN RAFAEL. CALIFORNIA EXPENDABLE TRUST FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES . FOR THE FISCAL YEAR ENDED JUNE 30, 1998 BUSINESS NEIGHBORHOOD IMPROVEMENT TRUST REVENUES: Uses of money and property $ $ Intergovernmental 35,000 Other revenues 15.588 Total Revenues 50.588 EXPENDITURES: Community development 61,352 5,000 Culture and recreation Total Expenditures 61.352 5,000 EXCESS (DEFICIENCy) OF REVENUES OVER EXPENDITURES (10,764) (5,000) FUND BALANCES AT BEGINNING OF YEAR 17,524 5,000 FUND BALANCES AT END OF YEAR $ 6,760 ~ 89 LIBRARY FIDUCIARY $ 21,548 1,183 22,731 31~572 31.572 (8,841) 400,910 ~ 392,069 RECREATION FIDUCIARY $ 28,704 ~ 28.704 TOTAL $ 21,548 35,000 16 .. 771 73 .. 319 66,352 31 .. 572 97 .. 924 (24,605) 452,138 ~ 427.533 90 l l ~TY OF SAN RAFAEL. CALIFO~~rl. AGENCY FUND STATEMENT OF CHANGES IN ASSETS AND LIABILITIES FOR THE FISCAL YEAR ENDED JUNE 30, 1998 Balance at Balance at July 1. 1997 Additions Deductions June 30, 1998 DEFERRED COMPENSATION ASSETS: Cash and investments $ 9.138,223 $ 3.137.499 $ 779.375 $11,496.347 TOTAL ASSETS $ 9.138,223 $ 3.137.499 $ 779.375 $11.496,347 LIABILITIES: Deferred compensation payable %.,$ .;;;..::9 ,=13::....:8=,2=2=3 _--",-$.:.,:3 '0=3 .:....:17'-1...4.:..::;9 ...... 9 _---"'$'-'-7"'""-'79~,3=7:....:::5 _ ___=$o:...:1..:..;1.L..:..49::....:6=.3:::....4:....:..7 TOTAL LIABILITIES =$ =9,=13=8=,2=:23====$=3=.3:::::17=.4=9:::::9=====$::::::77=9==.3=7=5 =::::=::=$1:=1==:.4::::::96:=.3=4=7 91 ( ( CITY OF SAN RAFAEL, CALIFORNIA SINGLE AUDIT ACT JUNE 30, 1998 * * * ( CITY OF SAN RAFAEL, CALIFORNIA TABLE OF CONTENTS JUNE 30, 1998 PAGE NO. Independent Auditor's Report on Schedule of Expenditures of Federal Award ..................................................................................... 1 Schedule of Expenditures of Federal Award........................................................................ 2 Notes to Schedule of Expenditures of Federal Award ......................................................... 3 Independent Auditor's Report on Compliance and on Internal Control over Financial Reporting Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards .............................. ............................... ....................... 4 - 5 Independent Auditor's Report on Compliance with Requirements Applicable to Each Major Program and Internal Control Over Compliance in Accordance with OMB Circular A-133.............................................................................................. 6 - 7 Schedule of Findings and Questioned Costs ....................................................................... 8 Prior Year's Findings and Questioned Costs ....................................................................... 9 c. G. UHLENBERG & co. LLP CERTIFIED PUBLIC ACCOUNTANTS ROBERT E. BARSANTI, C.P.A. PEGGY H. CHEN , C.P.A. JEFFREY J. IRA , C.P.A. KATHERINE C. WONG , C.P.A. INDEPENDENT AUDITOR'S REPORT ON SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS Honorable Mayor and Members of the City Council City of San Rafael, California We have audited the general purpose financial statements of the City of San Rafael, California, as of and for the fiscal year ended June 30, 1998, and have issued our report thereon dated October 23, 1998. These general purpose financial statements are the responsibility of the City of San Rafael's management. Our responsibility is to express an opinion on these general purpose financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards; Government Auditing Standards, issued by the Comptroller General of the United States; and the provision of Office of Management and Budget COMB) Circular A-133, Audits of State and Local Governments. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the general purpose financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall fmancial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In accordance with Government Auditing Standards, we have also issued a report dated October 23, 1998 on our consideration of the City of San Rafael's internal control structure and a report on October 23, 1998 on its compliance with laws and regulations. Our audit was conducted for the purpose of forming an opinion on the general purpose financial statements of the City of San Rafael, taken as a whole. The accompanying Schedule of Expenditures of Federal Awards is presented for purposes of additional analysis and is not a required part of the general purpose fmancial statements. The information in that schedule has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion, is fairly presented in all material respects in relation to the general purpose financial statements taken as a whole. e.G. ~ October 23, 199;·~ t Redwood City, California 1 647 Veterans Boulevard, Redwood City, CA 94063 Phone (650) 365-2323 • (408) 733-9944 • (510) 353-0330 Fax (650) 365-8394 CI'l'Y OF SAN RAFAEL. CALIFORNIA SCHEDULE OF EXPENDITURES OF FEDERAL A WARDS FOR THE FISCAL YEAR ENDED JUNE 30, 1998 PASS FEDERAL lHROUGH PROGRAM FEDERAL GRANTORIPASS lHROUGH CFDA GRANT OR AWARD PROGRAM CONTROLIPROGRAM TITLE NUMBER NUMBER AMOUNT REVENUES U .S. Department of Education: Pass through California State Library LSCA Transition Grant 84.034 40-4155 30,000 3,000 Pass through California State Library Library State Grant 84.010 40-4327 5,000 Library Title 1 84.010 40-4395 84,277 65,572 Total for CFDA 84.010 65,572 U.S . Department of Housing and Urban Development: Community Development Block Grant - Year 23 Entitlement 14.218 N/A 10,400 10,400 ADA Access Grant 14.218 N/A 50,000 Total for CFDA 14.218 10,400 U.S. Department of Justice: Copsmore 16.726 N/A 60,122 Code Enforcement Grant 16.592 N/A 55,204 Federal Emergency Management Agency: Pass through State of California FEMA Storm Damage 97/98* 83.544 041-68364 482,033 482,033 National Foundation on the Arts and the Humanities Institutes of Museum Services: Falkirk Grant 45.301 N/A 46,238 Total Federal Programs $561,005 * Major program as defmed by OMB Circular A-l33. 2 PROGRAM EXPENDITURES 11.348 5,000 68,492 73,492 10,400 2,300 12,700 15,937 25,325 482,033 10,081 $630,916 LA-IV OF SAN RAFAEL, CALIFORNIA NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS FOR THE FISCAL YEAR ENDED JUNE 30, 1998 1. General The accompanying Schedule of Expenditures of Federal Awards presents activity of the federal fmancial assistance programs of the City of San Rafael, California (the City). All federal financial assistance received directly from federal agencies as well as federal financial assistance passed through other government agencies is included on the schedule. 2. Significant Accounting Policies The accompanying Schedule of Expenditures of Federal Awards is presented using the modified accrual basis of accounting, which is described in Note 1 to the City's general purpose fmancial statements. The City does not budget for revenues or expenditures in the individual funds that receive federal awards. Federal programs are labeled either as Type A or Type B. Type A programs are defined as Federal programs with Federal awards expended during the audit period exceeding the larger of: (i) $300,000 or three percent (.03) of total Federal awards expended if the City's total Federal awards expended equal or exceed $300,000 but are less than or equal to $100 million. (ii) $3 million or three-tenths of one percent (.003) of total Federal awards expended if the City's total Federal awards expended equal or exceed $100 million but are less than or equal to $10 billion. (iii) $30 million or 15 hundredths of one percent (.0015) of total Federal awards expended if the City's total Federal awards expended equal or exceed $10 billion. Federal programs not labeled Type A as described above are labeled Type B programs. 3. Relationship to Federal Financial Reports Amounts reported in the accompanying Schedule of Expenditures of Federal Awards agree or can be reconciled with the amounts reported or to be reported in the federal financial reports. 3 ( c. G. UHLENBERG & co. LLP CERTIFIED PUBLIC ACCOUNTANTS ROBERT E. BARSANTI, C.P.A . PEGGY H. CHEN. CPA JEFFREY J. IRA , C.P.A . KATHERINE C. WONG . CPA INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Honorable Mayor and Members of the City Council City of San Rafael, California We have audited the general purpose financial statements of the City of San Rafael, California, as of and for the fiscal year ended June 30, 1998, and have issued our report thereon dated October 23, 1998. We conducted our audit in accordance with generally accepted auditing standards and Government Auditing Standards, issued by the Comptroller General of the United States. Compliance As part of obtaining reasonable assurance about whether the City of San Rafael, California's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grants, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance that are required to be reported under Government Auditing Standards. However, we noted certain immaterial instances of noncompliance, which we have reported to management of the City of San Rafael, California, in a separate letter dated October 31, 1998. Internal Control Over Financial Reporting In planning and performing our audit, we considered the City of San Rafael, California's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal control over financial reporting. Our consideration of the internal control over financial reporting would not necessarily disclose all matters in the internal control over financial reporting that might be material weaknesses. A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce, to a relatively low level, the risk that misstatements, in amounts that would be material in relation to the financial statements being audited, may occur and not be detected within a timely period by employees in the normal course of 4 647 Veterans Boulevard, Redwood City, CA 94063 Phone (650) 365-2323 • (408) 733-9944 • (510) 353-0330 Fax (650) 365-8394 perfonning their assigned functions. We did not note any matters involving the internal control over financial reporting and its operation that we consider to be material weaknesses. This report is intended for the infonnation of the audit committee, management, and federal awarding agencies and pass-through entities. However, this report is a matter of public record and its distribution is not limited. C. G. October 23, 1998 Redwood City, California 5 c. G. UHLENBERG & co. LLP CERTIFIED PUBLIC ACCOUNTANTS ROBERT E. BARSANTI, C.P.A . PEGGY H. CHEN , C.P.A. JEFFREY J. IRA, C.P.A. KATHERINE C. WONG, C P.A INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH QMB CIRCULAR A-133 Honorable Mayor and Members of the City Council City of San Rafael, California Compliance We have audited the compliance of City of San Rafael, California with the types of compliance requirements described in the Us. Office of Management and Budget (OMB) Circular A-l33 Compliance Supplement that are applicable to each of its major federal programs for the fiscal year ended June 30, 1998. City of San Rafael, California's major federal programs are identified in the Schedule of Expenditures of Federal Awards. Compliance with the requirements of laws, regulations, contracts and grants applicable to each of its major federal programs is the responsibility of City of San Rafael, California's management. Our responsibility is to express an opinion on City of San Rafael, California's compliance based on our audit. We conducted our audit of compliance in accordance with generally accepted auditing standards; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-l33, Audit of States, Local Governments, and Non-Profit Organizations. Those standards and OMB Circular A-l33 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about City of San Rafael, California's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination on City of San Rafael, California's compliance with those requirements. In our opinion, City of San Rafael, California complied, in all material respects, with the requirements referred to above that are applicable to each of its major federal programs for the fiscal year ended June 30, 1998. 6 647 Veterans Boulevard, Redwood City, CA 94063 Phone (650) 365-2323 • (408) 733-9944 • (510) 353-0330 Fax (650) 365-8394 Internal Control Over Compliance The management of City of San Rafael, California is responsible for establishing and maintaining effective internal control over compliance with requirements of laws, regulations, contracts and grants applicable to federal programs. In planning and performing our audit, we considered City of San Rafael, California's internal control over compliance with requirements that could have a direct and material effect on a major federal program in order to determine our auditing procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over compliance in accordance with OMB Circular A-133 . Our consideration of the internal control over compliance would not necessarily disclose all matters in the internal control that might be material weaknesses. A material weakness is a condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that noncompliance with applicable requirements of laws, regulations, contracts and grants that would be material in relation to a major federal program being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control over compliance and its operation that we consider to be material weaknesses. This report is intended for the information of the audit committee, management and federal awarding agencies and pass-through entities. However, this report is a matter of public record and its distribution is not limited. c. Or. ~ k Co. ~ October 23, 1998 Redwood City, California 7 (;ITY OF SAN RAFAEL. CALIFORNIA SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR THE FISCAL YEAR ENDED JUNE 30, 1998 Section I -Summary of Auditor's Results Financial Statements Type of auditor's report issued: Internal control over financial reporting: • Reportable condition(s) identified that are not considered to material weaknesses? • Material weakness( es) identify? Noncompliance material to financial statements noted? Federal Awards Internal control over major programs: • Reportable condition(s) identified that are not considered to material weaknesses? • Material weakness(es) identified? Unqualified ____ yes __ X __ none reported ____ yes __ X __ no ____ yes __ X __ no ____ yes __ X __ none reported ____ yes __ X __ no Type of auditor's report issued on compliance for major programs: Unqualified Any audit findings disclosed that are required to be reported in accordance with section 51O(a) of Circular A-133? Identification of major programs: CFDA Number(s) 83.544 Dollar threshold used to distinguish between type A and type B programs: Auditee qualified as low-risk auditee? ____ yes __ X __ no Name of Federal Program or Cluster FEMA -Storm Damage $300,000 __ X __ yes ___ ----'no 8 CITY OF SAN RAFAEL, CALIFORNIA SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR THE FISCAL YEAR ENDED JUNE 30, 1998 Section II -Financial Statement Findings No current and prior year finding noted. 9 .. (,1. fV OF SAN RAFAEL, CALIFORNlA SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR THE FISCAL YEAR ENDED JUNE 30, 1998 Section III -Federal Award Findings and Questioned Costs No current and prior year fmding noted. 10