HomeMy WebLinkAboutFin Financial Reports FY2010-11c`rY OF Agenda Item No: 3 r
Meeting Date: December 19, 2011
SAN RAFAEL CITY COUNCIL AGENDA REPORT
Department: FINANCE
Prepared by: Janet Pendoley
Interim Finance Director
City Manager Approval-`��-��
SUBJECT: FY 2010-2011 ANNUAL FINANCIAL AUDIT REPORT; THE GANN
APPROPRIATION LIMIT REPORT, AND THE MEMORANDUM ON
INTERNAL CONTROL
RECOMMENDATION: ACCEPT THE FY 2010-2011 ANNUAL FINANCIAL AUDIT
REPORT; ACCEPT THE GANN APPROPRIATION LIMIT
REPORT; AND ACCEPT THE MEMORANDUM ON
INTERNAL CONTROL
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 Maze and Associates, Accountancy
Corporation conducted the audit for fiscal year 2010-2011. 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.
The Federal Government requires that any local agency expending $500,000 or more in
combined federal grant funds, either directly or indirectly in a fiscal year, is subject to a separate
audit on those programs and a separate Single Audit Report is issued. This threshold amount did
occur in fiscal year 2010-2011; therefore, this separate audit report is required. This report will
be presented at a later date.
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 year
ending June 30, 2012. A Memorandum on Internal Control is also prepared by the auditors to
help identify areas that could help improve the City's organization and controls over financial
activities. This report is enclosed separately with this staff report.
FOR CITY CLERK ONLY
Council Meeting: i -- 1 €q I ;� v x /
l ..
SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 2
The City Council's approval and acceptance of fiscal year 2010-2011 Audited Financial Report,
the report on the Gann Appropriation Limit calculation, and the Memorandum of Internal
Control are needed to remain in compliance with local charter, State and Federal law.
ANALYSIS:
The actual results of the City's financial activities are presented in the Government -Wide
Financial Statements with governmental activities and business -type activities presented
separately. Net assets are a good indicator of the City's financial position. During this fiscal
year, net assets of the City were $200.1 million, which is a decrease of $7.8 million from the
prior year, primarily resulting from delayed replacement of depreciating assets. A financial
summary of expenditures and revenues is shown in the Statement of Activities and Changes in
Net Assets.
Supplementary explanatory information is provided in the Management's Discussion and
Analysis (MD&A) section beginning on page 3. The MD&A provides key highlights and a
summary view of performance of financial activities for the year ended June 30, 2011.
The Agreed -Upon Procedures report for the Gann Appropriations Limit required three steps to be
performed including testing the accuracy of the calculations and comparison of information
presented. No exceptions were noted in the three steps for the years ended June 30, 2012.
Our auditors are required to communicate to the City Council matters that come to their attention
relating to the audit in a report entitled Memorandum on Internal Control. Section one of this
report, entitled Schedule of Other Matters, addresses items that are considered by the auditors to
be worthy of note to the Council. Three recommendations were outlined in this section. The first
recommendation is that two Redevelopment Agency obligations be identified with greater
specificity on the Enforceable Obligation Payment Schedule. The second recommendation
mentions the staff s request for auditor assistance in determining the closing entries for the City's
Pension Obligation Bond (POB) funds. The third recommendation discusses best practices in the
area of information system security. Finally, one prior year recommendation, highlighting the
City's budget, liquidity and low reserves, was included to provide staff the opportunity to
comment on the current year status.
The second section of this report, entitled Required Communications, addresses several areas
relating to accounting practices and internal controls. No areas were identified as having
deficiencies that the auditors considered to be material weaknesses for fiscal year 2010-2011.
FISCAL IMPACT:
No fiscal impact occurs by having the Council accepts these reports. The fiscal year 2010-2011
Annual Financial Audit Reports and related reports are presented as the actual results of the City
and Agency financial activities for the year.
SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 3
OPTIONS:
The City Council can choose to:
1) Accept the Fiscal Year 2010-2011 Annual Financial Audit, Agreed -Upon Procedures
report for the Gann Appropriations Limits and the Memorandum on Internal Control
Structure as presented; or
2) Reject the reports and not file them with numerous County, State and Federal agencies as
required. Rejecting these reports would leave the City out of compliance with applicable
laws.
ACTION REQUIRED:
Staff recommends Council accept the reports and letters as presented.
Attachments: Comprehensive Annual Financial Report
Appropriations Limit Increments
Memorandum on Internal Control
W:Ilmanagernent Services- WorkFile'Tinance- Workfile\Council Material\Staff Reports\201 1\Ciq,Audit report
fV201 0-11
Am
L� i
COMPREHENSIVE ANNUAL FINANCIAL REPOR
FOR THE FISCAL YEAR ENDING JUNE 307 201
COMPREHENSIVE ANNUAL
For the Fiscal Year Ended
June 30, 2011
City of Rafael,
San I • r M
P.O.
Box i
• r w • n o • /US
Prepared FinanceDepartment
Janet
Pendoley, Interim Finance
This Page Left Intentionally Blank
SECTION
CITY OF SAN RAFAEL, CALIFORNIA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
For the Year Ended June 30, 2011
Table of Contents
INTRODUCTORY SECTION
TABLE OF CONTENTS
Letter of Transmittal .... ...... ...... ...... ............. _ ...... v
Mission Statement ... __ ...... ............ ........ .......... x
Cit -v Officials ... ....... ........ ....... .......... .... xi
LocationMap ......... ....... .......... _ .... - ..... ...... ...... ......... ....... ... xii
Organization Chart ... .......... ......... .............. ...... .......... ........ xiii
FINANCILAL SECTION I
Independent Auditor's Report on Basic Financial Statements ... ............... __ ......
Management's Discussion and Analysis ... - ....... ........ ...... ......... ...................... 3
Basic Financial Statements:
Government -wide Financial Statements:
Statement of Net Assets ... ...... ____ .......... ___ ............ ............. ...... _... 17
Statement of Activities ..... ...... ....... _ ... _ ....... ___ ... ... ...... ____ ... ____ ......... _ 18
Fund Financial Statements:
Major Governmental Funds:
Balance Sheet ... - ... __ .... _ ....... ............. ........ ....... ..... 22
Balance Sheet - Reconciliation of Governmental Fund Balances to
Net Assets of Governmental Activities .... __ ........ ...... ___,25
Statement of Revenues, Expenditures, and Changes in Fund Balances........................................26
Reconciliation of the Net Change in Fund Balances - Total Governmental
Funds with the Statement of Activities ...... ... __ .............. ...... __ 28
Proprietary Funds:
Statement of Net Assets.... .... ........ ...... ........ 30
Statement of Revenues, Expenses., and Changes in Fund Net Assets.. ..... ...... __ 31
,
Statement of Cash Flo,,vs .. ..... __ .... ____ .... ... .... .... ... __ )2
i
CITY OF SAN RAFAEL, CALIFORNIA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
For the Year Ended June 30, 2011
Table of Contents
FINANCIAL SECTION (Continued) I
Notes to Basic Financial Statements.. ......... ............ _ ...................................... ....................... 33
Required Supplementary Information:
Schedules of Revenues, Expenditures and Changes in Fund Balances — Budget and Actual -
Budgetary Basis
General Fund ..... ...... .......... ............. ...... 74
Traffic and Housing Mitigation Special Revenue Fund .... ...... _ ......... ...... 75
Gas Tax Special Revenue Fund.. ....... ___ .... _ ....... __ .... ..... ...... ............ ................ 76
Supplementary Information:
Schedule of Revenues, Expenditures and Changes in Fund Balances — Budget and Actual -
Budgetary Basis
Redevelopment Agency Capital Projects Fund ....... ___ .... .......... ............. _ .... __ .......... __ 78
Non -major Governmental Funds:
Combining Balance Sheet.. .......... ___ ........ __ ...... __ ........... .... __ ................ ____ .... __ ....... ___ ....... 82
Combining Statement of Revenues, Expenditures, and Changes
inFund Balance..... ......... __ .............. .... ____ ....... .... ___ .......... ...... .......... ..... 88
Budgeted Non -major Government Funds:
Combining Schedule of Revenues, Expenditures, and Changes
in Fund Balances — Budget and Actual. . ......... ........... _ ..... __ ................ _ ........ ... __94
Internal Service Funds:
Combining Statement of Net Assets ... - ..... __ ...... __ ........ ........... _ .... __ ........ 104
Combining Statement of Revenues, Expenses and Changes in Fund Net Assets...........................106
Combining Statement of Cash Flows. .... ___ ....... ____ ......... 108
CITY OF SAN RAFAEL, CALIFORNIA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
For the Year Ended June 30, 2011
Table of Contents
STATISTICAL SECTION
Financial Trends:
Net Assets by Component — Last Nine Fiscal Years.. .... __ ...................................... ........... ..........
112
Changes in Net Assets — Last Nine Fiscal Years ......... __ ....... ...... ................ .......... __ ............
114
Fund Balances of Governmental Funds — Last Ten Fiscal Years...........................................................
118
Changes in Fund Balance of Governmental Funds — Last Ten Fiscal Years..........................................
120
Revenue Capacity:
Assessed and Estimated Actual Value of Taxable Property — Last Ten Fiscal Years ... ....... ____
122
Property Tax Rates - All Direct and Overlapping Governments— Last Ten Fiscal Years......................123
Principal Property Tax Payers — Current Year and Ten Years Ago.......................................................124
Property Tax Levies and Collections — Last Ten Fiscal Years ... ___ ......... ...... __ ....... ......... ___
125
Debt Capacity:
Ratio of Outstanding Debt by Type — Last Ten Fiscal Years ... ....... ........... ____
126
Computation of Direct and Overlapping Debt ..... ......... ....... ___ ..........
127
Computation of Legal Bonded Debt Margin .. . _ _ . ...... ....... ....... ............. .......
128
Revenue Bond Coverage Parking Facility — Last Eight Fiscal
129
Redevelopment Pledged Revenue Coverage — Last Ten Fiscal Years ...................................................
130
Demographic and Economic Information:
Demographic and Economic Statistics — Last Ten Fiscal Years ............................................................131
Principal Employers..,.... ....... ........ .........
132
Operating Information:
Full -Time Equivalent City Govermnent Employees by Function
— Last Ten Fiscal Years. ....
133
Operating Indicators by Function[Prograrn — Last Ten Fiscal Years .... ...... ...
134
Capital Asset Statistics by Function,/Program — Last Teti Fiscal Years .................................................136
H
This Page Left Intentionally Blank
(I FY 0I
M,Yos GARY 0. Pii'LLIPS
Cou?,,cL?Steak Div mn. m CON NOLLY
HELLF-R
COUNCILMEMBFR KARL LE11TtIM
6000 1 I'll,
-C0vNC1
-mm '_'.14E1!3ER kivn.w CUY'_1,GAN 14,CCULLOUCH
December 15, 2011
Honorable Mayor, Members of the City Council and Residents of San Rafael:
The Comprehensive Arinual Financial Report (CAFR) of the City of San Rafael for the year ended
June 30, 2011, is hereby submitted as mandated by both local ordinances and State of California
statutes. These ordinances and statutes require that the City of San Rafael annually issue a report on
its financial position and activity, and that an independent firm of certified public accountants audits
this report,
Responsibility for both the data accuracy, and the completeness and fairness of the presentation,
rests with management. To the best of our knowledge and belief, the data presented is accurate in
all material respects and is reported in a mariner that presents fairly the financial position and results
of operations of the various funds and component units of the City of San Rafael. The financial
statements are prepared in accordance with Generally Accepted Accounting Principles as
promulgated by the Governmental Accounting Standards Board (GASB) and include the report of
the independent certified public accounting firm, Maze and Associates Accountancy Corporation.
Further, the CAFR is prepared in accordance with procedures and policies set by the Government
Finance Officers Association. The analysis of the financial condition and the result of operations
are in the Management's Discussion and Analysis document in the financial section. The CAFR is
organized into three sections:
I � Introductory section, which is unaudited, includes this letter of transmittal, an organizational
chart and a list of the City of San Rafael's elected and appointed officials,
1 Financial section includes the general-purpose financial statements, related footnote disclosures,
and the combining and individual fund and account group financial statements and schedules, as
well as the independent auditors' report,
1 Statistical section, which is unaudited, includes selected financial and demographic information,
presented on a multi-year basis. Generally, ten-year data is presented for expenditures,
revenues, assessed valuation for local properties and construction activity.
REPORTING ENTITY — PROFILE OF THE GOVERNMENT
The City of San Rafael provides a full range of municipal services required by statute or char]
namely: Fire, Police, Community Development (encompassing Building, Planning and Co
Enforcement), Public Works, Community Services (both Recreation and Child Care program
1400 F-,FrH AVENUE - PO SM 151560 * SAN RAFAEL, CA 94915-1560
MKWC I rYOFSAN'RASAFL - ORG
V
Redevelopment, Library and Management Services. The City Council is financially accountable for
the San Rafael Redevelopment Agency and the San Rafael Joint Powers Financing Authority.
These entities are considered blended component units and are combined with the City's figures in
this report. The San Rafael Sanitation District is a discretely presented component unit of the City
of San Rafael and is presented independent of City financial information. For a further explanation
of these entities, refer to Footnote No. I in the Financial Section of the CAFR.
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 agencies exercise full powers and authorities within the scope of the related Joint
Powers Agreement including the preparation of annual budgets, accountability for all funds, and
the power to make and execute contracts. Obligations and liabilities of the separate entities are
not those of the City. For a further explanation of these separate entities, refer to Footnote No. 13 in
the CAFR.
The Mission San Rafael Archangel was founded in 1817, San Rafael was incorporated in 1874 and
became a charter city in 1913 by vote within the City. The City Council is composed of five
members; four are elected at large to four-year terms. The mayor is elected separately to a four-year
term. The City currently has a land area of 22 square miles that includes 17 square miles of land
and five of water and tidelands. San Rafael's population in 2011 was 58,136.
The City of San Rafael is located 17 miles north of San Francisco in Marin County, Protected by its
Mediterranean like setting along the shores of the San Francisco Bay, the City enjoys a mild climate
year round. As the County seat, San Rafael is considered the commercial, financial and cultural and
civic hub of Marin County. Abundant recreational facilities are available in and around the San
Rafael area. In addition to the City's cultural, park and recreational resources, there are other
attractions that include Muir Woods, five State parks, the San Francisco area, Oakland and the
nearby wine country.
Each year business merchants and the SRDA sponsor community events, including the Classic Car
Parade, Farmers' Market, Winter Wonderland, Italian Street Painting Festival and the Parade of
Lights. San Rafael is home to Marin County's cultural activities. Marin Center presents numerous
ballets, concerts and speaking engagements. The Falkirk Cultural Center provides art exhibits and
children's programming.
ECONOMIC CONDITION
San Rafael is a regional employment center. The number of jobs within the City exceeds the
number of employed residents. Our diversified economic mix includes high-tech, financial, service
based, entertainment and industrial businesses. Approximately 72 percent of workers in San Rafael
work for companies, 10 percent work for the government and 14 percent are self-employed. The
median income for San Rafael households is $72,389.
There may be slight economic improvement for the fiscal year 2011-2012. Sales tax trends for
fiscal year 2010-2011 are slightly better than fiscal year 2009-2010, while property taxes are
expected to be flat. Job growth looks to get better in the coming months.
12
CAFR TRANSMITTAL LETTER
The economy will grow slowly the rest of t1tis year, and job gains will be limited. Major reductions
to the City fiscal year 2011-2012 budget included compensation reduction, layoffs, furloughs, and
reducing service hours. These changes were needed to balance fiscal year 2011-2012. The
compensation reduction and furloughs will continue into fiscal year 2012-2013 budget.
MAJOR INITIATIVES
CurrentFear Projects Accoplis ants and Service ltTorts
The City Council adopted a one-year budget in July of 2011 for the 2011-2012 fiscal year.
These objectives support Department goals, the City Council's five-year goals, and our Mission
Statement. Progress reports are provided to the City Council and community at six-month intervals
during the two-year budget.
The City issued the Tax and Revenue Anticipation Notes (TRANS) to bridge the gap between its
regular flow of operating expenditures and the receipts of its semi-annual property taxes.
M
CAFR TRANSMITTAL LETTER
San Rafael's fiscal practices are codified in the City's Financial Management Policies. The Policies
were adopted to manage current and long-term financial resources, allow for adequate controls, and
most importantly, to encourage input and participation in the City's financial affairs.
11110T.Mys I I _klylj' =
The City's Management Team is responsible for establishing and maintaining internal controls to
ensure that the City's assets are adequately protected from loss, theft or misuse. In addition,
management controls should ensure that proper accounting data is collected so as to prepare reports
in conformance with generally accepted accounting principles.
Internal accounting controls are designed to provide reasonable, but not absolute, assurance
regarding: (1) the safeguarding of assets against loss ftom unauthorized use or disposition; and (2)
the reliability of financial records for preparing financial statements and maintaining accountability
for assets. The concept of reasonable assurance recognizes that the cost of a control should not
exceed the benefits likely to be derived. All internal control evaluations occur within the above
framework. We believe the City's internal accounting controls adequately safeguard assets and
provide reasonable assurance that financial transactions are properly recorded.
Budget Controls - The City develops a budget based upon Council priorities and Department
objectives. The Finance Department maintains a traditional line item budget by major function.
Budget control is accomplished at the functional or division level within each fund. This budget
creates a comprehensive management and fiscal system aimed at achieving the objectives of each
operating level consistent with those that have been set for the community by the City Council.
Each department director is responsible for accomplishing goals within his or her functional area
and monitoring the use of their budget allocations consistent with policies set by the City Council
and monitored by the City Manager.
OTHER INFORMATION
Indendent Audit - the Charter of the City of San Rafael requires an annual audit of the City's
pe
financial records and transactions by an independent certified public accounting firm. This year, the
accounting firm of Maze and Associates Accountancy Corporation perfon-ned the audit, The audit
requirement has been met and the auditors' opinion has been included in this report.
Ackno�y�lcde�nt - The preparation of this document was accomplished through the diligent,
dedicated efforts of the Finance Department's staff. Appreciation goes to Van Bach, Accounting
Supervisor, Helen Yu, Accountant, and Carl Tregner, Accountant. All of these top-notch
employees were instrumental in coordinating the annual audit in a timely and professional manner.
Lastly, staffs support by the Mayor and City Council Members, with an emphasis on community
focus and customer service, has allowed the Finance Dep hent to bring professional level
financial leadership and management home to San Rafael. Staff expects to continue producing high
quality products, including award winning annual financial reports. The City Council's openness to
change and support in planning and conducting the operations of the City in a responsible,
CAFR TRANSMITTAL LETTER
progressive manner empowers staff to achieve important goals through a commitment to excellence,
professionalism and community interest.
Respectfully submitted,
Nancy Mackle]
City Manager Interim Finance Director
M
MISSION STATEMENT
The Mission of the City of San Rafael is to enhance the quality, of
life and to provide for a safe, healthy, prosperous and livable
environment in partnership with the community.
Our vision for San Rafael is to be a vibrant economic and
cultural center reflective of our diversity, with unique and
distinct neighborhoods in a beautiful natural environment,
sustained by active and informed residents and a responsible
innovative local government.
January 1996
Albert J. Boro, Mayor
.1
Barbara Heller, Vice- Mayor
Greg Brockbank, Council Member
Damon Connolly, Council Member
Marc Levine, Council Member
0
AOF
City Officials
City Council
Albert J. Boro, Mayor
Greg Brockbank, Council Member
Damon Connolly, Council Member
Barbara Heller, Council Member
Marc B. Levine, Council Member
Elected Officials
Rob Epstein, City Attorney
Esther Beirne, City Clerk
Management 'Team
Nancy Mackle, City Manager
Jim Schutz, Assistant City, Manager
Bob Brown, Community Development Director
David Dodd, Library Director
Chris Gray, Fire Chief
Stephanie Lovette, Economic Development Director
Carlene McCart, Community Services Director
Janet Pendoley, Interim Finance Director
Nader Mansourian, Public Works Director
Matt Odetto, Police Chief
Doris Toy, District Manager/Engyineer-SRSD
xi
LOCATION MAP
EM
This Page Left ffitentionally Blank-
INDEPENDENT ALTDITOR'S REPORT
ON BASIC FINANCIAL STATEMENTS
To the Honorable Mayor and Members of the City Council
City of San Rafael, California
We have audited the financial statements of the governmental activities, the business -type activities, each
major fund, and the aggregate remaining fund information of the City of San Rafael as of and for the year
ended June 30, 2011; which collectively comprise the City's basic financial statements as listed in the
Table of Contents. These financial statements are the responsibility of the City's management. Our
responsibility is to express an opinion on these financial statements based on our audit. We did not audit
the component unit financial statements of the San Rafael Sanitation District (District), which represents
15% and 13% of the assets and revenues and 3% and 9% of liabilities and expenses of the reporting entity,
respectively. These component unit financial statements were audited by other auditors, whose report
thereon has been famished to use Our opinion, insofar as it relates to the amounts included for this entity, is
based solely on the report of these other auditors.
We conducted our audit in accordance with generally accepted auditing standards in the United States of
America and the standards for financial audits contained in Government Auditing, Standards, issued by
the Comptroller General of the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance as to whether the financial statements are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial statement presentation. We
believe that our audit provides a reasonable basis for our opinion.
In our opinion the basic financial statements referred to above present fairly, in all material respects, the
financial position of the governmental activities, the business -type activities, each major fund, and the
aggregate remaining fund information of the City of San Rafael as of June 30, 2011, and the respective
changes in the financial position and cash flows, where applicable, thereof for the year then ended, in
conformity with generally accepted accounting principles in the United States of America.
As disclosed in Note 17, the State of California adopted Al3x1 26 on June 28, 2011, which suspends all new
redevelopment activities except for limited specified activities as of that date and dissolves redevelopment
agencies effective October 1, 2011. The State simultaneously adopted ABxl 27 which allows
redevelopment agencies to avoid dissolution by opting into an *'alternative voluntary redevelopment
program" requiring specified substantial annual contributions to local schools and special districts. These
conditions raise substantial doubt about the ability of the City of San Rafael Redevelopment Agency, a
component unit of the City, to continue as a going concern, However, on August 11, 2011, the California
Supreme Court issued a partial stay of ABxl 26 and a full stay of A]3xl 27, but the partial stay did not
include the section of ABxl 26 that suspends all new redevelopment activities. As a result, the
accompanying financial statements have been prepared assuming that the City of San Rafael
Redevelopment Agency will continue as a going concern. The activities of the City of San Rafael
Redevelopment Agency are included in the Redevelopment Agency Capital Projects Fund and
Redevelopment Agency Debt Service Fund of the accompanying financial statements. The financial
statements do not include any adjustments that might result from the outcome of this uncertainty.
As of July 1, 2010. the City adopted the provision of Governmental Accounting Standards Board
Statement Number 54 (GASB 54), Fund Balance Reporting and Governmental Fund Type Definitions.
As discussed in Note 9 to the financial statements, the provisions of this statement affect the classification
of fund balances reported in the financial statements.
In accordance with Government Auditing Standards, we have also issued our report dated October 28,
2011, on our consideration of the City of San Rafael's internal control over financial reporting and on our
tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and
other matters. The purpose of that report is to describe the scope of our testing of internal control over
financial reporting and compliance and the results of that testing, and not to provide an opinion on the
internal control over financial reporting or on compliance. That report is an integral part of an audit
performed in accordance with Government Auditing Standards and should be considered in assessing the
results of our audit.
Management's Discussion and Analysis and the Required Supplemental Information are not a required
part of the basic financial statements but are supplementary information required by the Government
Accounting Standards Board, We have applied certain limited procedures, which consisted principally of
inquiries of management regarding the methods of measurement and presentation of the required
supplementary information. However, we did not audit this information and express no opinion on it.
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
comprise the basic financial statements. The supplemental information listed in the Table of Contents is
presented for purposes of additional analysis and is not a required part of the basic statements of the City
of San Rafael. This information has been subjected to the auditing procedures applied in the audit of the
basic financial statements and, in our opinion, is fairly stated in all material respects in relation to the
basic financial statements taken as a whole.
The introductory section listed in the Table of Contents have not been subjected to the auditing
procedures applied in the audit of the basic financial statements and, accordingly, we express no opinion
on them.
October 28, 2011
CITY OF SAN RAFAEL
Management's Discussion and Analysis
Fiscal Year Ended June 30, 2011
This analysis of the City of San Rafael's (City) financial performance provides an overview of the City's financial activities
for the fiscal year ended June 30, 2011. Please read it in conjunction with the basic financial statements and the
accompanying notes to those basic financial statements.
FINANCIAL HIGHLIGHTS
Government -Wide Highlights:
0 NetAssets - The assets of the City exceeded its liabilities at fiscal year ending June 30, 2011 by $200.1 million.
0 Expense Activities - During the fiscal year the City's total revenues ($87.3 million) are less than expenses for
governmental and business -type activities ($95.1 million) by $7.8 million, Excluding, Depreciation (non-cash
expense of $7.7 million), collected revenues were $0.1 million above expenses.
0 Changes in Net Assets -- The City's total net assets decreased by $7.8 million in fiscal year 2011. Net assets of
Governmental activities decreased by $7,6 million, while net assets of the business type activities decreased by $0.2
million.
Fund Highlights:
0 Governmental Funds - Fund Balances- As of the close of fiscal year 2011, the City's governmental funds
reported combined ending fund balances of $34.4 million, a decrease of $1.1 million from the prior year. Of
this total amount, $19.5 million represents restricted fund balances, $4,4 million is committed fund balances,
and $9.5 million is assigned fund balances.
General Fund - The fund balance of the general fund on June 30, 2011 was $6.8 million, representing no
increase from the prior year. $0.6 million is nonspendable,
� $0.2 million is restricted, $0.6 million is
committed, $5.4 million is assigned, which includes $1.3 million for emergencies and cash flow needs and is
to be used to meet our 10% reserve requirement as defined by the city's financial management policies.
Lang -Term Debt:
The City's total outstanding debt increased by $1.0 million (4.6 percent) during the fiscal year, which reflects payment
on redevelopment debt, court fine repayment note, capitalized lease obligations, and the issuance of $4,490,000 in
2010 taxable pension obligation bonds.
OVERVIEW OF FINANCIAL STATEMENTS
This discussion and analysis is intended to serve as an introduction to the City's basic financial statements, which are
comprised of three components: 1) Government -Wide Financial Statements, 2) Fund Financial Statements, and 3) Notes to
the Basic Financial Statements.
The basic financial statements include the City (primary government) and all legally separate entities (component units) for
which the government is financially accountable. The City's component units consist of the following- The Redevelopment
Agency of the City of San Rafael (Agency) and the San Rafael Joint Powers Financing Authority (Authority), These
component units are., for practical purposes, departments of the City and have been included in the basic financial statements
as an integral part of the primary government using the blended method.
This report also contains other supplementary information in addition to the basic financial statements for further
information and analysis.
CITY OF SAN FAE+ L
Management's Discussion and Analysis
Fiscal Year Ended June 30, 20'11
Government -Wine Financial Statements
The Government -Wide Financial Statements present the financial picture of the City and provide readers with a broad
view of the City's finances. These statements present governmental activities and business -type activities separately
and include all assets of the City (including infrastructure) as well as all liabilities (including long-term debt).
Additionally, certain interfund receivables, payables and other interfund activity have been eliminated as prescribed
by Government Accounting Standards Board (GASB) Statement No. 34.
The Statement of Net Assets and the Statement of Activities and Changes in Net Assets report information about the City as a
whole and about its activities. These statements include all assets and liabilities of the City using the accrual basis of
accounting, which is similar to the accounting used by most private -sector companies. All of the current year's revenues and
expenses are taken into account, regardless of when cash is received or paid.
The Statement of Net Assets presents information on all of the City's assets and liabilities, with the difference between the
two reported as net assets. Over time, increases in net assets may serve as a useful indicator of whether the financial position
of the City is improving or deteriorating.
The Statement of Activities and Changes in Net Assets presents information showing how the City's net assets changed
during the year. All changes in net assets are reported as soon as the underlying event giving rise to the change occurs,
regardless of timing of related cash flows.
In the Statement of Net Assets and the Statement of Activities and Changes in Net Assets, City activities are separated as
follows:
Governmental Activities—Most of the City's basic services are reported in this category, including Public Safety, Public
Works and Parks, Community Development and Economic Development, Cultural and Recreation and Government
Administration (finance, human resources, legal, City Clerk and City Manager operations). Property, sales and use taxes,
user fees, interest income, franchise fees, hotel taxes, business license and property transfer taxes, plus state and federal
grants finance these activities.
Business -Type Activities—The City charges a fee to customers to cover all or most of the costs of certain services it provides.
The City's Parking Services program is reported as a business -type activity.
Discretely Presented Component Units - The government–wide financial statements include not only the City itself (known
as the primary government), but also a legally separate entity, the San Rafael Sanitation District for which the City is
financially accountable. Financial information for the San Rafael Sanitation District is reported separately from the financial
information presented for the primary government itself.
The government -wide financial statements can be found on pages 17 through 19 of this report.
Fund Financial Statements and Major Component Unit Financial Statements
A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for
specific activities or objectives. The City, like other state and local governments, uses fund accounting to ensure and
demonstrate compliance with finance -related legal requirements, All of the funds of the City can be divided into three
categories; governmental funds, proprietary funds, and fiduciary funds.
The fund financial statements provide detail information about each of the City's most significant funds, called Major Funds.
The concept of Major Funds, and the determination of which are major funds, was established by GASES Statement 34 and
replaces the concept of combining like funds and presenting them in total. Instead, each Major Fund is presented
individually, with all Non -major Funds summarized and presented in a single column. Further detail on the Non -major funds
is presented on pages 82 through 10 1 of this report.
MY OF SAN RAFAEL
Management's Discussion and Analysis
Fiscal Year Ended June 30, 2011
Governmental Funds — Governmental funds are used to account for essentially the same functions reported as governmental
activities in the government -wide financial statements. However, unlike the government -wide financial statements,
governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as on
balances of spendable resources available at the end of the fiscal year. Such information may be. useful in evaluating a
government's near-term financial capacity.
Because the focus of governmental funds is narrower than that of the government -wide financial statements, it is
useful to compare the information presented for government funds with similar information presented for
governmental activities in the government -wide financial statements. By doing so, readers may better understand the
long-term impact of the government's near-term financing decisions. Both the governmental fund balance sheet and
the governmental fund statement of revenues, expenditures, and changes in fund balances provide a reconciliation to
facilitate this comparison between governmental funds and governmental activities. These reconciliation's are
presented on the page immediately following each governmental fund financial statement.
The City has thirty-two governmental funds, of which four are considered major funds for presentation purposes.
Each major fund is presented separately in the governmental fund balance sheet and in the governmental fund
statement of revenues, expenditures, and changes in fund balances, The City's four major funds are - the General
Fund, Redevelopment Agency Capital Projects, Gas Tax, and Traffic and Housing Mitigation. Data from the other
twenty-seven governmental funds are combined into a single, aggregated presentation. The basic governmental fund
financial statements can be found on pages 22 through 28 of this report. Individual fund data for each of these non -
major governmental funds is provided in the form of combining statements on pages 82 through 101 of this report.
Z:�
Proprietary Funds — The City maintains two different types of proprietary funds - enterprise funds and internal service
funds. Enterprise funds are used to report the same functions presented as business -type activities in the government -wide
financial statements. The City uses an enterprise fund to account for its Parking Services program. Internal service funds are
used to accumulate and allocate costs internally among the City's various functions. The City uses internal service funds to
account for its fleet of vehicles, building maintenance, radio systems, telephone systems, personal computer replacement
program, self-insurance for -worker's compensation, dental, public liability, and employee benefits programs. Because these
services predominantly benefit governmental rather than business -type functions, they have been included within
governmental activities in the governmental -wide financial statements.
Proprietary funds provide the same type of information as the government -wide financial statements, only in more
detail. Like the government -wide financial statements, proprietary fund financial statements use the accrual basis of
z:1
accounting, There is no reconciliation needed between the government -wide financial statements for business -type
activities and the proprietary fund financial statements,
The basic proprietary fund financial statements can be found on pages 30 through 32 of this report
Fiduciary= FuntA, — The Cit-, currently has no fiduciary funds.
CITY OF SAN RAFAEL,
Management's Discussion and Analysis
Fiscal Year Ended June 30, 2011
Notes to the Financial Statements
The notes provide additional information that is essential to a full understanding of the data provided in the government -wide
and fund financial statements. The notes to the financial statements can be found on pages 33 through 69 of this report.
Required Supplementary Information
hi addition to the basic financial statements and accompanying notes, this report also presents certain required supplementary
information. One section includes budgetary comparison statements for the major funds (general, redevelopment agency
capital project, gas tax, and traffic and housing mitigation). The other section is a schedule of funding progress for the Marin
County Employees' Retirement System. All budgeted positions that are filled by either full-time or permanent part-time
employees (working seventy-five percent of full time equivalent) are eligible to participate in this system. Required
supplementary information can be found on pages 74 through 76 of this report.
GOVERNMENT -WIDE FINANCIAL ANALYSIS
Statement of Net Assets
Net assets are a good indicator of the City's financial position. During this fiscal year, net assets of the City were
$200.1 million, which is a decrease of $8.0 million from the prior year.
The following is the condensed Statement of Net Assets for the fiscal years ended June 30, 2010 and 2011.
City of San Rafael
Statements of Net Assets
June 30,
(Amounts in Millions)
Governmental Activities Increase Business -Type Activities Increase
2011 2010 (Decrease) 2011 2010 (Decrease)
Assets:
Current assets $ 51.0 S 40.4 S 10,6 2.4 $ 2.4
Capital assets, net 2 021 . 0DU (6,2) 17.4 17.8 (0,4)
Total assets
253.0
248.6
4.4
19,8
20.2
(0A)
Liabilities:
Current liabilities
16.3
8.9
7A
0.4
0.4
Long-term liabilities
493
443
4.6
6.6
6.8
(0.2)
Total liabilities
65,6
53.6
12,0
-.o
7.2
(0.2)
Net Assets:
invested in capital assets,
net of related debt
1743
173.5
0.8
10,8
11.0
Restricted
213
26,2
(4.9)
-
Unrestricted
(8-2)
(4.6)
(3.6)
1.9
10
(0,1)
Total net assets S
187.4 $
195.1
(7.7) S
12,7
13.0
(0.3)
At June 30, 2011, the largest portion of net assets (92.5 percent) consists of the City's investment in capital assets net of
related debt. This component portrays the total amount of funds required to acquire those assets less any related debt used
for such acquisition that is still outstanding. The City uses these capital assets to provide services to citizens. The decrease in
M
CfrY OF SAN RAFAEL',
Management's Discussion and Analysis
Fiscal Year Ended .Tune 30, 2011
total net assets from fiscal year 2010 to fiscal year 2011 is largely attributable to a netting of capital assets acquisition against
depreciation expense for the year. Total depreciation for this current year was $7.9 million, while capital asset acquisition
totaled $1.4 million, leaving a net decrease of $6.5 million.
The capital assets of the City are not sources of income for repayment of debt as most assets are not revenue generating and
generally are not liquidated to repay debt. Therefore, debt service payments are funded from other sources available to the
City. A portion of the City's net assets (10.7 percent) is subject to restrictions imposed by external parties and their use is
determined by those restrictions and agreements,
The City issued a Tax and Revenue Anticipation Notes (TRANS) for fiscal year 2010-2011 in amount of $6.0 million, which
was repaid in July 2011, This amount is reflected in increased current assets and current liabilities.
For the year ended June 30, 2011, the City reported positive balances of net assets in capital and restricted net assets for
governmental activities. Business -type activities reported positive net assets in capital and unrestricted net assets.
Net Assets
I
# of
$50,00
$0.00
($50.00)
Invesment in Capital Assets, Restricted
net of related debt
iE12011
$185.10 $21.30
Unrestricted
im
Total Net Assets
$200.1
CITY OF SAN RAFAET
Management's Discussion and Analysis
Fiscal Year Ended June 30, 2011
Statement ofAetivities
The following is the condensed Statement of Activities and Changes in Net Assets for the fiscal years ended June 30, 2011
and 2010:
Revenues:
Program revenues
General revenues
Total revenues
Expenses
Change in net assets
before transfers
'transfers
Net Assets:
Beginning, as restated
Ending
GovernmentalAedvilies:
Governmental Activities
2011 2010
For the Fiscal Years Ended June 30,
(Amounts in Millions)
Increase Business Type Activities Increase
(Decrease) 2011 2010 (Decrease)
$ 25-5 $ 25.8 $ (0.3) 4.0
57.7 53.6 4.1 -
83.2 79.4 3.8 4.0
913 88.6 2.7 3.7
4.2 (0.2)
4.2 (02)
4.0 (0.3)
(9 2) 1.1 0,3 01 0.1
0h5 0.5 $ - (0.5) (0.5) $ -
195.0 203.7
$ 187,4 195.0
12,9 13.2
12,7 -$ 12.9
The City's governmental activities decreased net assets by $7,6 million, -which represents a 3.9% decrease from last year.
Key elements of this change were as follows:
Revenue highlights.-
• Sales tax including Triple Flip Backfill tax and Measure S use tax increased by $2.6 million or approximately
13 .5 percent compared to fiscal year 2010.
• Paramedic tax increased by $172,000 or 4.9 percent,
• Motor vehicles revenues increased by $126,000 or 73.E percent due to receipt of excess MVLF revenue
collections by state for fiscal years 2007 through 2010.
• Transient Occupancy Tax revenues increased by $86,000 or 5.5 percent,
• Investment earnings decreased by $126,000 or 41.6 percent.
M
CITY OF SAN RAFAEL
Management's Discussion and Analysis
Fiscal Year Ended June 30,2011
Governmental Activities - Revenues.
0.4%
6.7%
2,6%
24.5%
12.9%
Governmental Activities - Expenses:
Governmental Activitie
Revenues By Source
June 30, 2011
n Property 'taxes
IM Sales Taxes
26.5%
E] Other Taxe s
[I Charges for Services
EMiscellaneous
26L%
E]Grants and Contributions
III nvestment Earnings
GovernmenW Activities
Expenses by Function
June 30, 2011
Memral Government
INPublic Safety
OPublic Works and Parks
IlCommunity, Development
ECulture and Recreation
El Debt Service
Total expenses for governmental activities Nvere $89,7 million (not including interest on long-term debt of $1.6 million).
Proaram revenues off -set total expenditures as follows:
* Those who directly benefited from programs contributed $20.0 million in charges for services.
* A total of $1.9 million in capital projects Was funded by outside agencies through capital grants and
contributions.
I
'CITY 0FSAN :RAFAEL
Management's Discussion and Analysis
Fiscal Year Ended June 30, 2011
As a result, total expenses that were funded by tax revenues; investment income and other general revenues were $67.8
million.
Functional expenses for the years ended June 30, 2011 were as follows:
Expenses by Function
For the fiscal year endedJ une 30, 2011
Function Amount
GCnet-dl Government
Pu bl is Safety
Pub! is vAorls and parks
Corntrunitydewlopmert
Cukm and recreation
Interest on Debt
Total Fxpenses
Business -Type Activities.
-
Percent of Total
8,269,846
9.1%
44,735,486
49.0%
17,408,038
19.1%
7,831,274
&6%
11,461,375
125%
1,621,605
1.8%
$ 91327,624 100.0%
Net assets for business -type activities were $12,71 million, a $0.2 million decrease from the prior fiscal year. Parking services
is the City's only business type activity and income is derived from program revenues of $4.0 million. Program revenues
include parking meter coin at $1.5 million, and parking garage hourly parking at $0.7 million. Revenues also include parking
and non -vehicle code fines totaling $1.8 million, Total expenses for parking services were $3.7 million and transfers out to
general fund for support totaled $0.5 million during fiscal year 2011.
FINANCIAL ANALYSIS OF INDWIDUAL FUNDS
Governmental Funds
Fund Balance Classifications
In February 2009, the Government Accounting Standards Board (GASB) issued Statement No. 54, "Fund Balance Reporting
and Governmental Fund Type Definitions" that is applicable to the financial statements issued by governmental entities for
the reporting period ended June 30, 2011, The objective of GASB statement No. 54 is to enhance the usefulness of fund
balance information by providing clearer fund balance classifications that can be more consistently applied and by clarifying
the existing governmental fund type definitions, Before GASB 54, fund balances for the governmental funds were classified
in three categories- reserved, unreserved designated and unreserved undesignated. Under GASB 54, fund balances are
classified in five categories: nonspendable, restricted, committed, assigned, and unassigned based on hierarchy of constraint.
Further details on fund balance classifications can be found in Note 913,
The focus of the City's governmental funds is to provide information on near-term inflows, outflows, and balances of
spendable resources. Such information is useful in assessing the City's financial capacity. In particular, unassigned fund
z:1
balance may serve as a useful measure of a government's net resources available for spending at the end of the fi iscal year.
As of the end of the current fiscal year, the City's governmental funds reported combined ending fund balances of $34.4
million. $1.0 million is nonspendable, $19.5 million is restricted, $4.4 million is committed. and $9.5 million is assigned.
H
CITY OF SAN RAFAEL'
Management's Discussion and Analysis
Fiscal Year Ended June 30, 2011
General Fund — The General Fund is the primary operating fund of the city.
At the end of the current fiscal year, the fund balance of the general fund was $6.8 million. $0.6 million was classified as
nonspendable. $0.08 million for assessment districts and $0.12 million for a court fine audit was classified as restricted. $0.6
million for project development was classified as committed. $5.4 million of the fund balance comprised of $3.5 for
worker's compensations claims, $0.4 million for liability claims and $0.2 million for encumbrances and $1.3 million for
emergency and cash flow needs were classified as assigned. The $1.3 million is intended to be used for emergency and cash
flow, needs. The goal is to set aside 10% for emergencies and cash flows as defined by the City's Financial Management
Policies.
Redevelop,ment.Agency Capital Project Fund — The Redevelopment Agency is responsible for assisting in the clearance and
Z.,
rehabilitation of areas determined to be in a declining condition in the City. The Agency's operations are funded primarily
by the issuance of debt, which is expected to be repaid out of property tax increment revenue generated by increased in
property assessed values in the redevelopment areas.
The Redevelopment Agency Capital Project Fund was established to account for capital improvement projects related to the
various redevelopment areas. At the end of fiscal year 2011, the restricted fund balance was $4.7 million, which was for
future capital project and housing programs.
Proprietary Funds
The City -'s proprietary funds provide the same type of information found in the government -wide financial statements, but in
�
more detail. As discussed in the business -type activities previously, the City's net assets decreased by $02) million as a
result of operations in the Parking Services fund.
GENERAL FUND BUDGETARY HIGHLIGHTS
The final amended General Fund budget projected total revenue at $52.7 million, total expenditures at $54.6 million, total
interfund transfers at a net of $1.7 million, with the resulting projected decrease in fund balance of ($131,957).
Actual revenues, at $53.6 million, exceeded budget by $1.0 million. Actual expenditures at $54.3 million and transfers at
$0.6 million fell short of budget by $0.2 million and $1.0 million, respectively. As a result there was a net decrease to the
fund balance of ($16,284).
CITY OF SAN RAFAEL
Management's Discussion and Analysis
Fiscal Year Ended June 30, 2011
CAPITAL ASSETS AND DEBT ADMiLNISTRATION
Capital Assets
The City's investment in capital assets for its governmental and business -type activities as of June 30, 2011 amounts to
$219.4 million, net of accumulated depreciation of $128.7 million. This investment in capital assets includes land, buildings,
improvements, machinery and equipment, infrastructure and construction in progress. Infrastructure assets are items that are
normally immovable and of value only to the City such as roads, bridges, streets and sidewalks, drainage systems, lighting
systems and similar items. The total additions to the City's investment in capital assets for the current fiscal year was $1.4
million, offset by accumulated depreciation and retirements of $7.9 million . thereby equaling a net decrease of $6.5 million.
Major capital asset additions during the current fiscal included work in process such as the City Hall HVAC Upgrades,
Canal Street Pedestrian Access & Safety Improvements, Safe Routes to Schools Sun Valley Elementary, and Traffic Signal
Cabinet & Controller Upgrades.
Capital Projects
� Northgate Gap Closure project was completed in 2011
Additional information on the City's capital assets can be found in Note 5 on pages 48 through 49 of this report,
Debt Administration
As of June 30, 2011, the City had outstanding debt issues as listed below. Not included in the following table is the
Community Facilities District No. I Special Tax Bond, which is backed by property tax levies against property owners. The
City has no obligation for these bonds. Certain specific revenues back each of the City's other bonds or General Fund lease
payments and carry respectable ratings. The City's long-term obligations for the fiscal years 2011 and 2010 were as follows:
12
Governmental
Business -Type
Activities
Activities
Total
2011 2010
2011 2010
2011
2010
Revenue Bonds
S
S 6.6 $ 6.8
6.6
6.8
Special Assessment Bonds
- -
-
-
Tax Allocation Bonds
33.3
35.4
333
35.4
Taxable Pension Obligation Bonds
4.5
-
-
45
Court Fine Promissory note
0.1
0.4
-
0.1
0A
Redevelopment note
0.2
02
-
0,2
0.2
Capitalized Leases
O'l
01
- -
01
O'l
Compensated Absences
4.1
4.3
0.1 0.2
43
4.5
Total Outstanding Debt
S 42.3
40.4
6.8 7.0
49.1 S
47.4
12
CITY OF SAN RAFAEL
Management's Discussion and Analysis
Fiscal Year Ended June 30, 2011
ECONOMIC CLIMATE AND NEXT YEAR'S BUDGET
Many factors were considered in preparing the City's budget for fiscal year 2011-2012. In July, the budget was balanced
with strategic remedies such as:
o Total compensation reduction of 4.0% for all employee groups resulting in a savings of $1.5 million to the general
Fund.
o Use of pension reserves resulting is savings of $1.0 million to the General Fund.
o Elimination of 6 positions for a total saving of $0.8 million in the General Fund and an additional 4 positions for a
total savings of $0.3 million in the Parking Fund,
The trend for sales tax, the city's biggest tax revenue generator, appears to be slightly better than fiscal year 2011. A 1.7 %
increase is estimated for fiscal year 2012. The sale of property is expected to increase causing a 5% increase in our property
transfer tax.
TheCity's second largest tax generator is property tax. The City is expecting the fiscal year 2012 tax roll to remain
relatively flat with a zero percent increase over the previous year.
The City's largest expenditure by far relates to personnel costs. Salaries and benefits are tied to the labor agreements
with each bargaining group. As indicated above., all bargaining groups agreed to a 2 year contract that provides an across
z1_
the board pay reduction equal 4.0%. This contract will extend through the fiscal year 2012-13.
In an effort to balance its budget, the State of California adopted ABx 1 26 on June 28, 2011, which suspends all new
redevelopment agencies effective October 1, 2011. The State simultaneously adopted ABxI 27 which allows
redevelopment agencies to avoid dissolution by opting into an "alternative voluntary redevelopment program" requiring
substantial annual contributions to local school and special districts. On July 18, the California Redevelopment
Association, the league of California Cities and others challenged the validity and constitutionality of ABx 126 and 27 to
the California Supreme Court. On August 11, 2011, as modified on August 17, 2011, the California Supreme Court
agreed to hear the case and issued a partial stay of ABxI 26 and a full stay of ABx 1 27, but the stay did not include the
section of ABxI 26 that suspends all new redevelopment activities. It is anticipated that the Court will render its decision
before January 15, 2012, the date the first voluntary program payment is due. The San Rafael City Council and San
Rafael Redevelopment Agency Board have chosen to participate in the Voluntary Alternative Redevelopment
Program pursuant to Part 1.9 of the California Community Redevelopment Law. The City Council's intention was
verified by the passage of Ordinance 1899 on September 19, 2011.
Please refer to Note 17 for further discussion on the potential consequences to the Agency from the decision of the
Supreme Court.
REQUEST FOR INFORMATION
This financial report is designed to provide our residents, businesses, customers, and investors and creditors with a
general overview of the City's finances and to demonstrate the City's accountability for providing high quality,
services within the limits of our fiscal resources. If you have questions about this report or need additional financial
information, contact the City of San Rafael — Finance Department, 1400 Fifth Avenue, Room 204, San Rafael,
California 94901.
I,
This Paae Left Intentionally Blank
I CITY OF SAN RAF AEL
STATEMENT OF NET ASSETS AND
STATE-TIVIENT OF ACTIVITIES I
The Statement of Net Assets and the Statement of Activities summarize the entire City's financial activities
and fmancial position.
The Statement of Net Assets reports the difference between the City's total assets and the City's total
liabilities, including all the City's capital assets and all its long-term debt. The Statement of Net Assets
focuses the reader on the composition of the City's net assets, by subtracting total liabilities from total
assets.
The Statement of Net Assets summarizes the financial position of all the City's Governmental Activities in a
single column, and the financial position of all the City's Business -Type Activities in a single column-, these
columns are followed by a total column which presents the financial position of the entire City.
The City's Governmental Activities include the activities of its General Fund, along with all its Special
Revenue, Capital Projects and Debt Service Funds. Since the City's Internal Service Funds service these
Funds, their activities are consolidated with Governmental Activities, after eliminating inter -fund
transactions and balances. The City's Business Type Activities include all its Enterprise Fund activities.
The Statement of Activities reports increases and decreases in the City's net assets. It is also prepared on the
full accrual basis, which means it includes all the City's revenues and all its expenses, regardless of when
cash changes hands. This differs from the "modified accrual" basis used in the Fund financial statements
which reflect only current assets, current liabilities, available revenues and measurable expenditures,
The Statement of Activities presents the City's expenses first, listed by program, and follows these with the
expenses of its business -type activities. Program revenues—that is, revenues which are generated directly
by these programs—are then deducted from program expenses to arrive at the net expense of each
governmental and business -type program, The City's general revenues are then listed in the Governmental
Activities or Business -type Activities column, as appropriate, and the Change in Net Assets is computed and
reconciled with the Statement of Net Assets.
Both these Statements include the financial activities of the City, the City of San Rafael Redevelopment
Agency, and the San Rafael Joint Powers Financing Authority which are legally separate but are
component units of the City because they are controlled by the City, which is financially accountable for
their activities. The balances and the activities of the discretely presented component units of the San
Rafael Sanitation District are included in these statements as separate columns.
15
This Page Left Intentionally Blank
CITY OF SAN RAFAEL
STATEMENT OF NET ASSETS
JUNE 30, 2011
See accompanying notes to financial statements
N
Component
Unit
Primary Government
San Rafael
Governmental
Business -Type pe
Sanitation
Activities
Activities
Total
District
ASSFTS
Cash and investments available for operations (Note 2)
$41.184,733
-
$2,303,855
$43,48M88
$13,137,705
Restricted cash and investments (Note 2)
736,767
736,767
472,130
Receivables:
Accounts
2,337,172
29,549
2,366,720
3,189
Taxes
4,295,718
4,295,718
Grants
1,425,544
1,425,544
Interest
65,012
65,012
560
Loans (Note 4)
926,902
926,902
Prepaid expenses and others
40,111
40,111
144,749
Capital assets (Note 5):
Nondepreciable
85,035,325
8,620,853
93,656,178
1,244.776
Depreciable, net
116,952,579
8,802,739
125,755,318
32,083,335
Total Assets
251999,863
19,756,995
272,756,858
47,086,442
LIABILITIES
Accounts payable
3,927,590
123,518
4,051,108
1,142,026
Deposits payable
35,276
35,276
Interest payable
321,104
78,535
399,639
15,510
Developer bonds payable
346,766
346,766
Arbitrage payable
25,127
25,127
Interest payable
111,157
111,157
Claims payable (Note 14):
Due in one year
2,200,000
2,200,000
Due in more than one year
1,770,1717
1,7710,1717
Compensated absences (Note ID:
Due in one year
740,718
15,769
756,487
Due in more than one year
3,37 1 ,594
167,134
3,538,728
Long-term debt (Note 6 and 7):
Due in one year
8,598,320
185,000
8,783,320
940,000
Due in more than one year
35,632,499
6,445,000
42,077,499
Net OPEB liability (Note 12)
8,485,000
8,485,000
Total Liabilities
65,565,328
7,014,956
72,580,284
2,097,536
NETASSETS (Note 9):
Invested in capital assets, net of related debt
174,281,922
10,793,592
185,075,514
32,845,291
Restricted for
Special revenue projects
13,556,816
13,556,816
Capital projects
4,201.575
4,2015575
Debt service
(2,559,712)
2,554,712)
Redevelopment po:.;ects
6,124,259
6,124,258
Total Restrcted Net Assets
21,-22,937
21,322,937
Unrestricted
i"8.170,324)
1,9487447
(6,221,877)
12,143,615
Total Net Assets
$187,434,535
$12,742,039
S200,176,574
544,988,906
See accompanying notes to financial statements
N
CITY OF SAN RAFAEL
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2011
Business -t) pe Activities
Parking services 3,785,751 4,011,333
Total Business -type Activities 3,785,751 4,011,333
Total Primary Government $95,113,375 $23,996,063 53,651,902 $1,857,670
Component Unit
San Rafael Sanitation District 59,677,630 $12,223,779
General revenues:
Taxes:
Property
Sales
Paramedic
\140tor vehicles
Transient occupancy
Franchises
Business licenses
Other
Investment earnings
Miscellarxous,
Aid from other governmental agencies
Transfers
Total general revenues and transfers
Change in Net Assets
Net Assets, beginning of year
Net Assets, end of � ear
See accompanying notes '0 Financial statements,
In
Program Revenues
Operating
Capital
Charges for
Grants and
Grants and
Functions/Programs
Expenses
Services
Contributions
Contributions
Primary Government
Governmental Activities:
General government
$8,269,846
$1,636,542
$500,651
Public safety
44,735,486
6,167,925
845,169
Public works and parks
17,408,038
4,141,103
1,564,703
$1,857,670
Community development ,'redevelopment
1,804,650
2,676-663
Culture and recreation
11,487,999
5,362,497
741,3779
Interest on long-term debt
1,621,605
Total Governmental Activities
91,321,624
19,984,730
3,651,902
1,.857,670
Business -t) pe Activities
Parking services 3,785,751 4,011,333
Total Business -type Activities 3,785,751 4,011,333
Total Primary Government $95,113,375 $23,996,063 53,651,902 $1,857,670
Component Unit
San Rafael Sanitation District 59,677,630 $12,223,779
General revenues:
Taxes:
Property
Sales
Paramedic
\140tor vehicles
Transient occupancy
Franchises
Business licenses
Other
Investment earnings
Miscellarxous,
Aid from other governmental agencies
Transfers
Total general revenues and transfers
Change in Net Assets
Net Assets, beginning of year
Net Assets, end of � ear
See accompanying notes '0 Financial statements,
In
Net (Expenses) Revenues and Changes in Net Assets
Component
Primary Government Unit
San Rafael
Governmental Business -Type Sanitation
Activities Activities Total District
($6,132,653) (56,132,653)
(37,722,392) (3.7,722,392)
(9,844,562) (9,844,562)
(5,127,987) (5,,127,987)
(5,384,123) (5,384,123)
(1,621,605) (1,621,605)
(65,833,322) (65,833,322
19
5225.582
225,582
225.582
225,582
(65,833,322)
225,582
(65,607,740)
$2,546,149
21,632,733
21,632,733
1,214,519
21,623,445
21,623-3,445
3,661,064
3,661,064
297,425
297,425
1,644,262
1,644,262
2,990,539
2,990,539
2,296,460
2,296,460
1,930, 531
1,930,531
176,502
11,878
188,380
59,265
1,496,1 74
1,496,174
6,499
463,600
(463,600)
58,212,735
(451.722;
57,761,013
1,280,283
(7,620,5871
(226.140]
1',846,?27.i
3.826,432
195,055,122
12,968= 179
208A-23,301
41,162,474
$187,434,535
512,742,039
52011,176,574
$44,9881906
19
This Page Left Intentionally Blank
I FUND FINANCIAL STATEMENTS I
Major funds are defined generally as having significant activities or balances in the current year.
The funds described below were determined to be Major Funds by the City in fiscal 2011. Individual
non -major funds may be found in the Supplemental section.
GENERAL FUND
Established to accounts for all financial resources and transactions except those required to be accounted for
in other funds.
TRAFFIC AND HOUSING MITIGATION FUND
Established to maintain a long-term developer deposits for major housing and street improvement
projects.
GAS TAX FUND
Established to receive and expend the City's allocation of the State gasoline taxes.
REDEVELOPMENT AGENCY CAPITAL PROJECTS FUND
Established to account for the capital projects activities of the San Rafael Redevelopment Agency.
21
CITY OF SAN RAFAEL
GOVERNMENTAL FUNDS
BALANCE SHEET
JUNE 30, 2011
ASSETS
Cash and investments available for operations (Note 21)
Restricted cash and investments (Mote 2)
Receivables:
Accounts
Taxes
Grants
Interest
Loans (dote 4)
Due from other funds ('vote 3A)
Prepaid expenses
Total Assets
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable
Deposit, payable
Developer bonds payable
Arbitrage payable
Note payable ( Note 6)
Interest payable
Due to other funds (wrote 3A)
Deferred revenue
Compensated absences (Note 1J)
Total Liabilities
Fund Balances (Note 9):
Nonspendable
Restricted
Committed
Assigned
Unassigned
Total Fund Balances
Total Liabilities and Fund Balances
$1,427,725
51,1419,654
Redevelopment
35,276
Traffic and
Agency
320,266
Housing
Capital
General
Mitigation
Gas Tax
Projects
$9,897,730
$9,093,397
$1,875,751
55,485,855
76,015
420.992
173,993
75,499
95,576
4,008,611
178,383
2,024
87021,057
510,814
26,624
60,326
4,658
549,722
62,858
314,322
40,111
9,093,397
1,138,226
4,684,936
$14,806,568
59,156,255
$2,640,447
$6,356,051
$1,427,725
51,1419,654
5149,042
35,276
320,266
25,000
25127,
6,080,000
111.157
6,267
26,624
40,366
87021,057
1,199,654
225,79.+
589,833
562,858
314,32'
200,238
9,093,397
1,138,226
4,684,936
555,561
28,816
1,120,000
5,439,8-179
273,751
5,000
6,785,511
9,156,255
1,440,793
6,124,258
514,8116,568
59,156,255
$2,640.447
$6,1350051
See accompanying notes
to basic financial
statements
12
Other Total
Governmental Governmental
Funds Funds
$10,213, 792 $36,566,525
10,590 507,597
926,510
1,271,578
106,640
4,295,718
888,106
1,425,544
28
65,012
926,902
474,644
474,644
474,644
40,111
512,620,316 $45,573,631
$880,463
$3,650>884
35,276
1,560
346,766
25,127
6,080,000
111,157
474,644
474,644
329,859
362,750
252
40,618
1,686, 719 11, t 31,222
967,013
4,372,808 19,489,605
2.715,506 4,419,883
3,845178 9,563,908
10,933,592 34,440,409
$12,620,310 $45,573,631
This Page Left Intentionally Blank
CITY OF SAN RAFAEL
GOVERNMENTAL FUNDS
BALANCE SHEET - RECONCILIATION OF GOVERNMENTAL
FUND BALANCES TO NET ASSETS OF GOVERNMENTAL ACTIVITIES
JUNE 30, 2011
Total fund balances reported on the governmental funds balance sheet $34,410,409
Amounts reported for Governmental Activities in the Statement of Net Assets are
different from those reported in the Governmental Funds because of the following:
Capital assets used in Governmental Activities are not financial resources and,
therefore, are not reported in the Governmental Funds, 201,987,904
Internal service funds are used by management to charge the cost of management of
communication, telephone, building, fleet maintenance, equipment replacement, workers'
compensation, employee benefits, insurance, and pose -retirement healthcare benefits to individual
funds, I he assets and liabilities are included in Governmental Activities in the Statement of Net
Assets. 1,152,266
Interest payable on Long-term debt does not require the use of current financial
resources and, therefore; are not reported in the Governmental Funds. (321,104)
Long-term liabilities, inetuding bonds payable, are not due and payable in the current
period and, therefore, are not reported in the Governmental Funds. (33,660,819)
Long-term compensated absences (4,071,694)
Net OPEB liability ( 8,485,000})
Claims payable (3,970,177)
Deferred revenue 312.750
Net assets of governmental activities $187,434,535
See accompanying notes to financial statements
25
CITY OF SAN RAFAEL
GOVERNMENTAL Ft","DS
STATEMENT OF REVENtjES. EXPENDITtiRES, AND CHANGES IN FUND BALANCES
FOR THE YEAR ENDED JUNE 30, 2011
RFVENUES
Taxes and special assessments
Licenses and permits
Fines and forfeitures
Use of money and properties
Intergovernmental
Charges for services
Other revenue
Total Revenues
EXPEIN DITU RES
Current:
General government
Public safety
Public works and parks
Community development /redevelopment
Culture and recreation
Capital outlay
Capital improv=ement / special projects
Debt service:
Principal (Note 7)
Interest and fiscal charges
Total Expencitures
EXCESS (DEFICIENM OF REVENNUES
OVER (UNDER) EXPENDITURES
OTHER FINANCING SOURCES tIJSES"
Transfers in (Now 33)
Transfcrs out (Note 3B)
Total Other Financing Sources (Uses}
Net Change in Fund Ba!ances
Redevelopment
Traffic and Agency
Housing Capital
General Mitigation Gas Tax Projects
$42,346,707
$936,383
1,416,772
34,098,697
862,820
7-475,774
148,213
$47,928 30,981
60,464
6,645,495
2,700,095
1,819,641
22,115 528,261
29,525
395.558
83,ol5
1109,020
53.635,206
70,043 3,322,958
1.135,392
6,789,829
40,481,
34,098,697
7-475,774
68,376
18,790
106,893
3,074,897
1,452,454
2,211,033
162,267
701,403
152,814
2,432,293
307,119
239,106
105,156
5,',309,573
68376
3,152,486
1,906,946
674-367)
1h67
170472
(771,554),
2,146,685
520,000
141,379
{2,288,602)
(1,301119)
658,08',
(781,119,)
141,371)
t;6-284)
(610 647)
(630,175)
FIUNID BALANCES, BEGINNING OF YEAR 6,8(1,!,795 9'54-589 2, ;51.4''1) 6,'54 433
FUND BALANCES. END OF YEAR —$("785-111-, $9,156,255 ...-.SI,440,793 $6,124,258
See accornpanlrg notes to fina'-ICA staternenis
26
Other Total
Governmental Governmental
Funds Funds
$8,165,040
$51,448,130
6,868,555
1,416,7'-2
2,996,343
862,821)
113,128
380,720
1518,537
11,864,127
13 ,489,208
15,988,750
438,652
1,026,845
24,724,565 82,848,164
32,832
6,863,142
6,868,555
40,957,252
2,996,343
10,666,176
4527,351
7,856,789
10,067 822
881,813
1,745,483
3,348,636
6,240',861
2,251,232 2,531,338
1,343, 754 1,448,910
25,620.054 85,057,435
(895489) (2,169271)
2,193,7701 5,806,834
(I,067,605) (4,6573=6)
1,131,165 1,149,508
235,676 (1,019,763)
10,697,916 35,460,172-
$10,933,592
5,460,=72
$10,933,592 $34,440,409
27
CITY OF SAN RAFAEL
Reconciliation of the
NET CHANGE IN FUND BALANCES - TOTAL GOVERNMENTAL FI.,NDS
with the
STATEMENT OF ACTIVITIES
FOR THF. YEAR ENDED JUNE 30, 201 1
NET CHANGE IN FUND BALANCES -TOTAL GOVERNME\T AL FUNDS
Amounts reported for Governmental Activities in the Statement of Activities are
different because of the following:
Capital Assets Transactions
Governmental funds report capital outlays as expenditures. Ilowever, in the Statement of Activities the cost of those assets
is capitalized and allocated over their estimated useful lives and reported as depreciation expense.
Capital outlay and capital projects expenditures are therefore added back to fund balance
Nori-capitalized capital outlay expenditures were reclassified to various governmental activities
Depreciation expense is deducted from the fluid balance
Loss on retirement of capital assets is deducted from the fund balance
Long -Term Debt Proceeds and Payments
Bond proceeds provide current financial resources to governmental funds, but
issuin„ debt increases long-term liabilities in the Statement of Net Assets.
Repayment of bond principal is an expenditure in the governmental funds, but
in the Statement ot'Net Assets the repayment reduces tong -term liabilities.
Principal debt service payments are added back to fund balance
Bond interest accretion is deducted from fund balance
Bond premium amortization is added back to fund balance
Accrual of Ideon -Current Items
The amount below included in the Statement of Activities does not require the use
of current financial resources and therefore is not reported as revenue or expenditures in governmental funds (net chta.ge);
Interest payable
Compensated absences
Deferred revenue
Net OPER iiabihP,
Claims Payable
Allocation of internal Service Fund Activities
Interna service f:nd - are used n, management -01 charge the costs of certain activities to
individual i'unds. Ric net re,enue ofthe internal service fund is reported with governmental. activities.
c.h a€ee in Net Assets ot'GoNerrimental Actrviues
See acct nupanv.nt, notes to financial statements
-r 8
($1,619,`x63_)
'.9'86.344
(6,631,483)
(7,545 706)
2,530,333
(247,311)
?9,860
(5,184)
20,5,288
3615750
(2,220,000)
i703,630j
MAJOR PROPRIETARY FUNDS
Proprietary funds account for City operations financed and operated in a manner similar to a private
business enterprise. The intent of the City is that the cost of providing goods and services be financed
primarily through user charges.
The City reported its only enterprise fund as a major proprietary fund.
PARKING SERVICES FUND
Established to maintain parking garages, lots and spaces in the Downtown Parking District (established
over 40 years ago), and to pay for parking enforcement., meter collection, and downtown office services.
29
crry OF SAN RAFAEL
PROPRIETARY FUNDS
STATEMENT OF'.NETASSETS
JUNE 30, 2011
Business -type
Activities -
Enterprise Governmental
Funds Activities
Parking Internal
Services Service Funds
ASSETS
Current Assets:
Cash and investments available for operations (Note 2)
S2,324,995
$4,597,070
Restriced cash and investments {Note 2)
229,170
Accounts receivable
29,548
1,065,594
Due front other funds (Note 3A)
803,158
Total Current Assets
2,354,541
6,694,992
Noncurrent Assets:
Capital assets ( ' Note 5):
Nondepreciable
020,853
Depreciable, net
81802,739
Total Noncurrent Assets
17.4237592
Total Assets
19,778T33
6,694,992
LIABILITIES
Current Liabilities:
Accounts payable
123,518
270,706
Interest payable
78,53-5
Due to other funds (Note 3A)
803,158
Compensated absences, due in one year (Note IJ)
15,' ' 769
Lona -term debt, due in one year (Note
185,000
Total Current Liabilities
402,822
1,073,864
Noncurrent Liabilities:
Compensated absences (Note IJ)
167-134
Long-term debt (Note 7)
6,445,000
4.4913,000
Total Noncurrent Liabilities
6,612, 13 34
4,490,000
Total liabililies
I4,956
5,5.63,864
NET ASSETS (Note 9):
Invested in capital assets, net of related debt
10,793,592
Llnresiricted
1,969,585
1. 1 -3 1, 128
Total Net Assets
12,763,177
S1,131J28
Some amounts reported for husiness- type acovifie.s in the
Statement of Net Assets are different because Certain internal
service fund assets and liabilities are included with business-ly a
activities. (21,138)
Net assets hus;ness-tvS12,742.o3i)
PC aeuvales
See accompanying notes to fittancial staten-icits
30
CITY OF SAN RAFAEL
PROPRIETARY FUNDS
STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET ASSETS
FOR THE YEAR ENDED JUNE 30, 2011
Business -type
Activities -
Enterprise Governmental
Parking Internal
OPERATING REVEN(JES
Charges for current services $2,154,308 $9,405,657
Other operating revenues 1,857,1125 2,002,980
Total Operating Revenues 4,011,333 11,408.637
OPERATING EXPENSES
Personnel
2,17/5,631
Insurance premiums and claims
6,101,491
Maintenance and repairs
41,321
110,635
Depreciation
332,233
General and administrative
884,459
744,613
OPEB Expense
-
4,009,971
Total Operating Expenses
3,433,644
14,966,710
Operating Income
577,689
441,927
NONOPER'TING REVENUES (EXPENSES)
Investment income
11,878
19,147
Interest expense
(319,391)
(511,512)
Total Nonoperating Revenues (Expenses,'
(307,513)
(492,365)
Income Before Transfers
270,17/6
(50,438)
Transfers in (Note 3B)
358,032
Transfers out (Note 3B)
(463,600)
(1,043,940)
Change in Net Assets
(193,424)
(736346)
NET ASSETS, BEGI-NINING OF YEAR
12,956,601
1-867,474
NET ASSETS, END OF YEAR
12,763„ 177
$1,131,128
Change in Net Assets
(133,424)
Sonne amounts reported for business-a"ne activities in the Statement
of Activities are difterent because the portion of the net mcorne of certain
internal service funds is reported with the business -type activities which
those funds serviced. k31/16)
Change in Net Assets of Busfiiess-type Activities ($226,1404
See iccornpanying notes to linan6al statements
31
CITY OF SAN RAFAEL
PROPRIETARY FUNDS
STATE LENT OF CASH FLOWS
FOR THE YEAR ENDED JUNE 30, 2011
See acctipanyng, n()tes to basic financiaktatemen't
32
Business -type
Activities -
Enterprise
Governmental
Funds
Activities
Parking
Internal
Services
Service Funds
CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from customers/other funds
S2J54,308
$9,393,746
Cash payments to suppliers for goods and services
(912,843)
(107597,894)
Cash payments to employees
{2,180,301' I
Other operating revenues
1,882,161
2,002,980
Cash Flows from Operating Activities
943,325
798,832
CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES
Interfund payments
(463,600)
(685,908)
Cash Flows from Noncapital
Financing Activities
(463,600)
(685,908)
CASH FLOWS FROM CAPITAL
AND RI EATED FINANCING AC'flVFffES
Proceeds received from issuance of Ion-, term debt
4,260,830
Principal payments on certificates of participation
(175,000)
Interest expenses and fiscal charges
(511 ,512)
Cash Flows from Capital and
Related Financing Activities
i496J41)
3,749,33418
CASH FLOWS FROM INVESTING ACTIVITIES
Investment income
11 ,878
19,147
Cash Flows from Investing Activities
I I,878
1%147
NET INCREASE IN CASH AND CASH EQUIVALENTS
(4,538,
3,981,389
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR
21329,531
715,681
CASH AND CASH EQUIVALENTS, END OF YEAR
S2,324,993
$4,597,070
FUND BALANCFS. BEGINNING OF YEAR
provided by operating activities:
Operating income
S57 7,689
S441,92-7
Ad-justments to reconcile operating income
to cash flows from operating activities;
Depreciation
*32,2 1
Net change in assets and habilitre :
Accounts receivable
25j16
Prepaids and deposits;
5,025
12 5,24 1
Accounts payable
7,912
243+5
Compensated absence oblqgations
(4 67(l)
Claims ow, able
Net Cash provided bv in) Operating: Actvides
S9437325
5798,832
See acctipanyng, n()tes to basic financiaktatemen't
32
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES I
A. Description of the Financial Reporting Entity
As required by generally accepted accounting principles, the financial statements present the City of
San Rafael (the City) as the Primary Government, with its component units for which the City is
considered financially accountable. The component units discussed below are included in the City's
reporting entity because of the significance of their operational and financial relationships with the
City.
B. Description of Blended Component Units
The accompanying basic financial statements include all funds and boards and commissions that
are controlled by the City Council, The basic financial statements include the City's blended
component units, entities for which the City is considered to be financially accountable. A
blended component unit, although a legally separate entity.. is in substance, part of the City's
operations and so data from this entity is combined with the City, The City's following blended
component units are described below.
San Rafael Redevelopment Agency — The San Rafael Redevelopment Agency (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 detennined to be in a declining, condition in the City. Financial activity of
the Agency commenced in July 1983. Under the Agency's Redevelopment Plan (Plan), approved in
November 1982, the Agency is to assist in the development of the property located in the central
San Rafael business core and cast 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 goveming board of the Agency.
The Agency's assets, liabilities, revenues and expenditures (other than those applicable to its capital
assets and long-term debt) are reported in the Fund Financial Statements. The Agency's capital
assets and long-term debt are reported with the Governmental Activities in the Government -Wide
Financial Statements.
San Rafael Joint Powers Financing Authority — The San Rafael Joint Powers Financing
Authority (Authority) was created by the City of San Rafael pursuant to Articles I and 2 of Chapter
5 of Division 7 of Title I of the Government Code of the State of California for the purpose of
assisting in the financing and refinancing of certain assessment district activities in the City.
All of the Authority's assets, liabilities, revenues and expenditures
Financial Statements. The Agency's capital assets and long-term
Governmental Activities in the Government -Wide Financial Statements
33
are reported in the Fund
debt are reported with the
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
NOTE I - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Co
C. Description of Discretely Presented Component Unit
San Rafael Sanitation District — The San Rafael Sanitation District (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 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 appoints two out of the three board members and has the ability
to remove the two board members at will.
The District's activities are reported as a discretely presented component unit in a separate column
in the basic financial statements which includes the District's assets, liabilities, revenues, expenses,
results of operations and cash flows. The District's fiscal year end in June 30 and its separately
issued component unit financial statements can be obtained at Central Marin Sanitation Agency,
Finance Department, 1301 Andersen Drive, San Rafael, California 94901.
D. Basis of Presentation
Government -wide Statements - The Statement of Net Assets and the Statement of Activities
display information about the primary government (the City) and its component units, These
statements include the financial activities of the overall City government, except for fiduciary
activities. Interfund transfers and amounts owed between funds within the primary government
have been eliminated from the statements. Amounts representing interfund services and uses
remain in the statements. These statements distinguish between the governmental and business -
type activities of the City. Governmental activities generally are financed through taxes,
intergovernmental revenues, and other nonexchange transactions. Business -type activities are
financed in whole or in part by fees charged to external parties.
The Statement of Activities presents a comparison between direct expenses and program
revenues for each segment of the business -type activities of the City and for each function of the
City's governmental activities. Direct expenses are those that are specifically associated with a
program or function and, therefore, are clearly identifiable to a particular function. Program
revenues include (a) charges paid by the recipients of goods or services offered by the programs,
(b) grants and contributions that are restricted to meeting the operational needs of a pariieular
program and (c) fees, grants and contributions that are restricted to financing the acquisition or
construction of capital assets. Revenues that are not classified as program revenues, including all
taxes, are presented as general revenues.
Fund Financial Statements: The fund financial statements provide information about the City's
funds, including fiduciary funds and blended component units. Separate statements for each fund
category — governmental and proprietary — are presented. The emphasis of fund financial
statements is on major individual governmental and enterprise funds, each of which is displayed
in a separate column. All remaining governmental and enterprise funds are aggregated and
reported as nonmajor funds.
34
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
NOTE t - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) I
Proprietary fund operating revenues, such as charges for services, result from exchange
transactions associated with the principal activity of the fund. Exchange transactions are those in
which each party receives and gives up essentially equal values. Nonoperating revenues, such as
subsidies and investment earnings, result from nonexchange transactions or ancillary activities.
E. Major Funds
Major funds are defined as funds that have either assets, liabilities, revenues or
expenditures/expenses, equal to ten percent of their fund -type total and five percent of the grand
total, The General Fund is always a major fund. The City may also select other funds it believes
should be presented as major funds.
The City reported the following major governmental funds in the accompanying financial
statements:
General Fund — Accounts for all financial resources and transactions except those required to be
accounted for in other funds.
Traffic and Housing Mitigation Fund — Established to maintain long-term developer deposits
for major housing and street improvement projects.
Gas Tax Fund - Established to receive and expend the City's allocation of the State gasoline
taxes.
Redevelopment Agency Capital Projects Fund — Consist of five funds; 1) the 1999 Agency
Bonds Funds, 2) the 2002 Agency Bonds Funds, 3) the RDA Capital Improvement Fund (for
improvement projects), 4) project Administration Fund, and 5) the Housing Fund.
The City reported its only enterprise fund as a major fund in the accompanying financial
statements. The enterprise funds is:
Parking Services Fund — Established to maintain parking garages, lots and spaces in the
Downtown Parking District (established over 40 vears ago), and to pay for parking enforcement,
meter collection, and downtown officer services.
The City also reports the following fund types:
Internal Service Funds - These funds account for: building-, maintenance, employee benefits,
liability insurance, workers' compensation, dental insurance, and employee retirement, all of
which are provided to other departments on a cost -reimbursement basis.
35
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
NOTE I - SUNEVIARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued
F. Basis ofAccounting
The government -wide, proprietary and discretely presented component unit financial statements
are reported using the economic resources measurement focus and the full accrual basis of
accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities
are incurred, regardless of when the related cash flows take place.
Governmental funds are reported using the current financial resources measurement focus and
the modified accrual basis of accounting. Under this method, revenues are recognized when
measurable and available, The City considers all revenues reported in the governmental funds to
be available if the revenues are collected within sixty days after year-end. Expenditures are
recorded when the related fund liability is incurred, except for principal and interest on long-term
debt, claims and judgments, and compensated absences, which are recognized as expenditures to
the extent they have matured. General capital asset acquisitions are reported as expenditures in
governmental funds. Proceeds from long-term debt and acquisitions under capital leases are
reported as other financing sources.
Those revenues susceptible to accrual are property and sales taxes, certain intergovernmental
revenues, interest revenue, charges for services, fines and forfeitures. Sales taxes collected and
held by the state at year end on behalf of the City are also recognized as revenue. Other receipts
and taxes are recognized as revenue when the cash is received.
Non-exchange transactions, in which the City gives or receives value without directly, receiving
or giving equal value in exchange, include taxes, giants, entitlements, and donations. On the
accrual basis, revenue from taxes is recognized in the fiscal year for which the taxes are levied or
assessed. Revenue from grants, entitlements, and donations is recognized in the fiscal year in
which all eligibility requirements have been satisfied. Under the terms of grant agreements, the
City may fund certain programs with a combination of cost -reimbursement grants, categorical
block grants, and general revenue. Thus, both restricted and unrestricted net assets may be made
available to finance program expenditures. The City's policy is to first apply restricted grant
resources to such programs, followed by general revenues if necessary.
The City considers restricted shared state revenues such as gasoline taxes and public safety sales
taxes, restricted locally imposed transportation sales taxes, fines, forfeitures, licenses, permits,
charges for services, and program grants as program revenues.
Certain indirect costs are included in program expenses reported for individual functions and
activities.
The City follows statements and interpretations of the Financial Accounting Standards Board and
its predecessors that were issued on or before November 30, 1989, in accounting for its business -
type activities, unless they conflict with Government Accounting Standards Board
pronouncements.
36
CITY OF SAN RAF AEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2411
NOTE 1- SUMMARY OF SIGNIFICANT ACCOLTNTING POLICIES (Continued)
G. Budgets, Budgetary Accounting, And Encumbrances
The City adopts a budget on a biannual basis, to be effective July 1 for the ensuing and subsequent
fiscal years. The two year budget reflects estimated revenues and expenditures for each fiscal year,
except for capital projects funds. Projects in Capital Projects Fund are budgeted by the Council on
a multi-year basis. 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.
Expenditures may not exceed appropriations at the departmental level, which is the legal level of
control, 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.
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 a reservation of fund balances since they do not constitute expenditures or liabilities and
are carried forward in the subsequent year's budget. All unencumbered appropriations lapse at year
end.
The following Major Special Revenue Fund incurred expenditures in excess of their budget.
Sufficient resources were available within each department to finance these overages.
Gas Tax Special Revenue Fund S1,500,931
H. Cash Equivalents
For purposes of the statement of cash flows, the City considers all highly liquid investments
(including all restricted assets) with maturity of three months or less when purchased to be cash
equivalents, The City maintains a cash and investment pool that is available for use by all funds.
As the proprietary funds' share of this pool is readily available when needed, such share is also
considered - to be cash equivalent. Deposit assets in the proprietary funds are related to insurance
and benefits and are not considered cash equivalents for purposes of the statement of cash flows.
L Capital Assets
All capital assets are valued at historical cost or estimated historical cost if actual historical cost
is not available. Contributed capital assets are valued at their estimated fair market value on the
date contributed.
The City has included the value of all infrastructure capital assets into its Basic Financial
Statements using the Basic Approach for infrastructure reporting.
Major outlays for capital assets and improvements are capitalized as projects are constructed.
Interest incurred during the construction phase is reflected in the capitalized value of the asset
constructed, net of interest earned on the invested proceeds over the same period.
W
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
I NOTE I - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) I
Capital assets, excluding infrastructure, are recorded if acquisition or construction costs exceeds
$5,000. The similar threshold for infrastructure is $25,000.
Depreciation is provided using the straight-line method which means the cost of the asset is divided
by its expected useful life in years and the result is charged to expense each year until the asset is
fully depreciated. The purpose of depreciation is to spread the cost of capital assets equitably
among all users over the life of these assets. The amount charged to depreciation expense each year
represents that years pro rata share of the cost of capital assets.
The City has assigned the useful lives listed below to capital assets:
Buildings, improvements, and structures 20 — 50 years
Machinery and equipment 5 — 15 years
Infrastructure 15 — 50 years
J, Compensated Absences
Compensated absences are accrued as earned. Upon termination, employees are paid for all unused
vacation at their current hourly rates. Unused sick leave based upon the rate of two to three percent
(2%-3%) for each year of service, one half of accumulated sick leave becomes vested, up to a
maximum amount as specified under labor contract provisions. The vested portion is available for
current use or, if unused, is payable at termination or retirement.
The long-term portion of the liability for compensated absences for governmental fund type
operations is recorded as compensated absences in the government -wide financial statements.
Compensated absences are liquidated by the fund that has recorded the liability. Proprietary fund
liabilities are recorded within their respective funds.
The changes of the compensated absences were as follows:
38
Governmental
Business -Type
'P
Activities
Activities
Total
Beginning Balance
$4,276,982
$187.573
$4,464,555
Additions
3,660,856
116,090
3,776,946
Payments
(3,825,526)
(1220,760)
(3,946,286)
Ending Balance
$4,112,312
S181903.
$4,295,215
Current Portion
$740,718
$15.769
$756,487
38
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
NOTE 1- SLIIMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued}
K. Property Tax Levy, Collection and _'Maximum Rates
State of California Constitution Article XIII A provides that the combined maximum property tax
rate on any given property may not exceed 1% 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 X111 A and may be adjusted by no more than 2% per year unless
the property is sold, transferred, or substantially improved. The State Legislature has determined the
method of distribution of receipts from a 1% tax levy among the counties, cities, school districts
and other districts. Marin County assesses properties, bills for and collects property taxes on the
schedule that follows:
Secured Unsecured
Valuatiortlien dates January I January I
Levy dates July I July I
Due dates (delinquent as of) 50% on November I (December 10) July I (August 3 1)
50% on February I (April 10)
The term "unsecured" refers to taxes on personal property other than land and buildings. These
taxes are secured by liens on the property being taxed.
Property taxes are levied and 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 authorized 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
L. Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles
(GAAP) requires management to make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent asset and liabilities at the dates of the financial
statements and the reported amounts of revenues and expenditures,"ex.penses during the reporting
periods. Actual results could differ from those estimates.
IV. New Fund
The City created Employee Retirement Internal Service Fund in fiscal year 2011 to account for a
special parcel tax dedicated to public library services and facilities, equipment, and technology
improvements, The City also created Library Assessment Special Revenue Fund to account for the
principal payments, interest payments, and related cost of the 2010 Taxable Pension Obligation
Bonds.
39
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
=NOTE 2 - CASH AND INVESTMENTS
The City's goal is to invest at the maximum yield, consistent with safety and liquidity, while
individual funds can process payments for expenditures at any time.
A. Policies
The City invests in individual investments and in investment pools. Individual investments are
evidenced by specific identifiable securities instruments, or by -an electronic entry registering the
owner in the records of the institution issuing the security, called the book entry system. In order to
increase security, the City employs the Trust Department of a bank as the custodian of certain City
managed investments, regardless of their form.
California Law requires banks and savings and loan institutions to pledge government securities
with a market value of 110% of the City's cash on deposit, or first trust deed mortgage notes with a
market value of 150% of the deposit, as collateral for these deposits. Under California Law this
collateral is held in a separate investment pool by another institution in the City's name and places
the City ahead of general creditors of the institution.
The City's investments are carried at fair value, as required by generally accepted accounting
principles. The City adjusts the carrying value of its investments to reflect their fair value at
each fiscal year end, and it includes the effects of these adjustments in income for that fiscal
year.
B. Classification
Cash and investments as of June 30, 2011, are classified in the financial statements as shown below,
based on whether or not their use is restricted under the terms of City debt instruments or agency
agreements.
Financial Statement Presentation:
Statement of Net Assets:
City of San Rafael:
Cash and investments available for operations
Restricted cash and investments
Total Primary Government Cash and Investments
San Rafael Sanitation District:
Cash and investments available for operations
Restricted cash and investments
Total San Rafael Sanitation District Cash and
Investments
Total Cash and Investments
40
$43,488,588
736,767
44,225,355
13.137.705
472.130
13,609.835
$57,835,190
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
CASH AND INVESTMENTS (Continued}
The City does not allocate investments by fund. Each proprietary fund's portion of Cash and
Investments Available for Operations is in substance a demand deposit available to finance
operations, and is considered a cash equivalent in preparing the statement of cash flows.
C. Investments Authorized by the California Government Code and the City's Investment Policy
The City's investment policy and the California Government Code allow the City to invest in the
following provided the credit ratings of the issuers are acceptable to the City; and approved
percentages and maturities are not exceeded. The table below also identifies certain provisions of
the California Government Code, or the City's Investment Policy where it is more restrictive:
The District adopted the investments policy of the Treasurer and Tax Collector of the County of
Marin. Accordingly.. the District, following the County, may invest in U.S. Treasury and agency
securities, commercial papers, bankers' acceptances, time deposits, repurchase agreements, and
the State of California LAIL. The District, additionally, may invest in the Marin Country
Investment Pool. At year-end, the District's investments were in compliance with the above
provisions
41
Minimum
Maximum
Maximum
Maximum
Credit
Percentage of
Investment in
Authorized Investment Type
Maturity
Quality
Portfolio
One Issuer
U.S. Government Obligation
5 years
No limit
No limit
U.S. Agency Securities and
5 years
AAA
No limit
No limit
Instruments
Repurchase Agreements
I year
A-]
No limit
No limit
Prime Commercial Paper
270 days
A-1
25%
$1,000,000
Bankers' Acceptances
180 days
A -I
40%
$2,000,000
Medium -Term Corporate Notes
5 years
A
30%
$1,000,000
Negotiable Certificates of Deposit
5 years
AA
30%
No limit
Non-negotiable Certificates
180 days
N/A
No limit
No limit
of Deposit
Local Agency Investment Fund
N/A
N/A
N/A
NIA
Money Market Mutual Funds
N/A
AAA
10%
N/A
Limited Obligation Improvement
30 years
NT/A
N/A
N/A
Bonds related to Special
Assessment Districts and Special
Tax Districts
The District adopted the investments policy of the Treasurer and Tax Collector of the County of
Marin. Accordingly.. the District, following the County, may invest in U.S. Treasury and agency
securities, commercial papers, bankers' acceptances, time deposits, repurchase agreements, and
the State of California LAIL. The District, additionally, may invest in the Marin Country
Investment Pool. At year-end, the District's investments were in compliance with the above
provisions
41
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
NOTE 2 - CASH AND INVESTMENTS {Continued)
D. Investments Authorized by Debt Agreements
The City must maintain required amounts of cash and investments with trustees or fiscal agents
under the terms of certain, debt
issues. These funds are unexpended, bond proceeds or are pledged
as reserves to be used if the City fails to meet its obligations under these debt issues. The California
Goverriment, Code requires
these -funds to be invested in accordance with City ordinance bond
indentures or State statute.
The tater below identifies the investment types that are authorized for
investments held by fiscal
agents. The table also identifies certain provisions of these debt
agreements:
Maximum
Maximum Minimum Credit Percentage of
Authorized Investment Type
_TMaturity Portfolio
5 years to no
U.S. Treasury Obligations
maximum N//A ',No Limit
U.S. Agency Securities
3- 5 years N/A No Limit
U.S. Agency Instruments
5 years AAA No Limit
Repurchase Agreements
I year A-1 No limit
Category
Bankers' Acceptances
360 days Highest Rating No Limit
Category
Money Market Funds
N/A Highest Rating No Limit
Category
Prime Commercial Paper
2710 days Highest Rating No Limit
Guaranteed Investment Contracts
Category
(fully collateralized) (A)
Highest Rating No Limit
Two Highest
Municipal Obligations
N/A Category Ratings No Limit
Medium -Term Corporate Notes
5 Years A No Limit
Non -Negotiable Certificates of
Deposit
180 Days IN, tA No Limit
Negotiable Certificates of
Deposit
5 Years N/A No limit
Local Agency Investment Fund
NWA N/A -N/A
(A) Guaranteed Investment Contracts
must be fully collateralized with U.S. Treasury Obligations or
U.S. Agency Obligations.
42
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
I NOTE 2 - CASH AND INVESTMENTS (Continued}j
E. Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value
of an investment. Normally, the longer the maturity of an investment, the greater the sensitivity of
its fair value to changes in market interest rates. The City also manages its interest rate risk by
holding most investments to maturity, thus reversing unrealized market gains and losses.
Information about the sensitivity of the fair values of the City's investments (including investments
held by bond trustee) to market interest rate fluctuations is provided by the following table that
shows the distribution of the City's investments by maturity or earliest call date:
Type of Investment
12 Months
or Less
13 to 24
Months
Total
City:
U.S. Federal Agency Securities
$1,003,295
$1,5017995
$2,505,290
Money Market Mutual Funds
1,680,499
1,680,499
Local Agency Investment Fund
38,112,057
38,112,057
Corporation Notes
507,885
507,885_
Total Investments
$40,7195,851
$2,004,880
42,805,731
Cash in banks and on hand
1,419,624
Total City Cash and Investments
44,225,355
San Rafael Sanitation District:
Cash in banks and short-term pooled investments
13.609,835_
Total District's Cash and
Investments
11609,835_
Total Cash and Investments
$57,835,140=
The City is a participant in the Local Agency Investment Fund (LATE) that is regulated by
California Government Code Section 164219 under the oversight of the Treasurer of the State Of
California. The City reports its investment in L),N-IF at the fair value amount provided by LAIF,
which is the same as the value of the pool share. The balance is available for withdrawal on
demand, and is based on the accounting records maintained by LAIF, which are recorded on an
amortized cost basis. Included in LAIT's investment portfolio are collateralized mortgage
obligations, mortgage-backed securities., other asset-backed securities, loans to certain state
funds, and floating rate securities issued by federal agencies, government-sponsored enterprises,
Z-1
United States Treasury Notes and Bills, and corporations. At June 30, 2011, these investments
matured in an average of 21317 days.
Money Market Mutual Funds are available for withdrawal on demand and at June 30, 2011,
matured in an average of 19 days.
43
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
I NOTE 2 - CASH AND INVESTMENTS (Continued)
F. Credit Rhvk
Credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the
investment. This is measured by the assignment of a rating by a nationally recognized statistical
rating organization. Presented below is the actual rating as of June 30, 2011, for each of the
Primary -Government's investment types as provided by Standard and Poor's or Fitch investment
rating systems, except as noted:
Type of Investment Aa2/.AA—
Aaa/AAA
City:
U.S. Federal Agency Securities
$2,505,290
Money Market Mutual Funds
1,680,499
Corporation Notes 5507,885
Total rated investments
Not rated:
Local Agency Investment Fund
Cash in banks and on hand
Total City Cash and Investments
San Rafael Sanitation District:
Not rated:
Cash in banks and short-term
pooled investments
$13,609,835
Total District's Cash and
Investments
Total Cash and Investments
Total
54,693,6714
3 8,112,057
1,419,624
44.225,355
13,609,835
$57,835,190
On August 5, 2011, Standard & Poor's Ratings Services (S&P) lowered its long-term credit
rating on the United States of America from AAA to AA -i% At the same time, S&P affirmed its
A- I+ short-term rating on the United States of America.
On August 8, 2011, S&P lowered its issuer credit ratings and related issue ratings on ten of
twelve Federal Home Loan Banks (FHLBs) and the senior debt issued by the FHLB System from
AAA to AA+. S&P also lowered the ratings on the senior debt issued by the Federal iarm, Credit
Banks (FFCB) from AAA toAA-'-. and lowered the senior issue ratings on Fannie Mae (FNMA)
and Freddie Mac (FHI-MC) from AAA to AA-�-. The A subordinated debt rating and the C rating
on the preferred stock of these entities remained unchanged. Finally, S&P affirmed the short-
term issue ratings for these entities at A-1-4-. As of June 30, 2011, the City's investments in these
agencies were as follows: FHLB $1,503,870, FFCB $501,245 and FHLMC $500,175.
M
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
CASH AND INVESTMENTS (Continued)
G. Concentration of Credit Risk
Investments in any one issuer, other than U. S. Treasury securities, money market mutual funds,
and California Local Agency Investment Funds that represent 5% or more of total City-wide
investments are as follows at June 30, 2011:
Reporting Unit Issuer Investment Type Amount
Entity -wide Federal Home Loan Bank Federal Agencies Obligation $1,503,870
General Fund Federal Home Loan Bank
Federal Home Loan Mortgage Corporation
Federal Farm Credit Bank
GE Capital Corporate Medium Term Notes
NOTE 3 - INTER -FUND TRANSACTIONS
A. Inter; fund Receivables and Payables
Federal Agencies Obligation 1,503,870
Federal Agencies Obligation 500,175
Federal Agencies Obligation 501,245
Corporate Bonds 507,885
Amounts due to or due from other funds reflect inter -fund balances for services rendered or short-
term loans expected to be repaid in the next fiscal year.
As of June 30, 2011, the Childeare Special Revenue Fund owed the Recreation Revolving Special
Revenue Fund $29,304 and the Sewer Maintenance Special Revenue Fund owed the Storm -water
Special Revenue Fund $445,340.
The Employee Benefits Internal Service Fund owed the Liability Insurance Internal Service Funds
$803,158 respectively as of June 30, 2011.
B. Transfers
Resources may be transferred from one City fund to another. Transfers routinely fund capital
projects or capital outlays, lease or debt service payments, operating expenses and low and
moderate -income housing projects,
45
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
I NOTE 3 - INITER-FUND TRANSACTIONS (Continued)
Transfers between funds during the fiscal year ended June 30, 2011, were as follows:
From Fund
General Fund
Gas Tax Fund
Non Major Governmental Funds
Parking Services Enterprise Funds
Internal Service Funds
To Fund Amount
Non -Major Governmental Funds
1,930,5710 A
Internal Service Funds
358.032 B
General Fund
1,301,119 C
General Fund
406.226 C
Gas Tax Fund
520,000 C
Redevelopment Agency Capital Projects Fund
141,379 D
General Fund
398,600 C
Non -Major Governmental Funds
65,000 A
General Fund
840,740 C
Non -Major Governmental Funds
203.200 A
$6,164,866
(A) Transfers to the Non -Major Governmental Funds were for administrative costs, program support,
capital projects, special projects and housing portion of debt service,
(B) Transfers to the Internal Service Funds were to fund internal operations.
(C) Transfers to the General Fund and Gas Tax Fund were for street maintenance support, admin costs, and dispatch contract.
(D) Transfers to the Redevelopment Agency Capital Projects fund were for administrative costs and to fund capital projects.
C. Internal Balances
Internal balances are presented in the Entity -wide financial statements only. They represent the net
interfund receivables and payables remaining after the elimination of all such balances within
governmental and business -type activities.
NOTE 4 — LOANS RECEIVABLE AND DEFERRED REVENLTE I
A. Summary of Loans Receivable
The City has reserved the portion of fund balance represented by these loans, At June 30, 2011,
these loans totaled:
Employees' Loans $20,247
Centertown Associates 314,322
One "11" Street Associates 62.858
Fire Chief Loan 529,475
Total $926.902
M
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
NOTE 4 — LOANS RECEIVABLE AND DEFERRED REVENUE (Continued}
B. Employee Loans
Effective February 1, 2000, the City agreed to loan employees up to $2,500 for the purchase of
computer hardware and software. The loan program, which stipulates that employees may not have
more than one loan outstanding, provides fmancial assistance from the City in the form of a no
interest loan repaid through automatic payroll deductions.
C. Centertown Associates
The City loaned Centertown Associates, Ltd.. $303,000 at 3% interest due semiannually. The loan
was made for the construction of a 60 -unit affordable Centerto-'vn apartment complex and is fully
secured by a deed of trust. The final payment is due on July 31, 2065.
D. One "H" Street Associates
The City loaned One "H" Street Associates $100,000 at zero percent interest with annual payments
of $2.857 and with a final payment due January 18, 2034. The loan was made in connection with an
affordable housing project located at One "H" Street.
E. Fire Chief Loan
On September 17, 2007, the City Council approved a Home Loan Agreement to provide the Fire
Chief with housing assistance. Under the Agreement, which was executed on October 3, 2007, the
City loaned the Fire Chief $600,000 to assist in the purchase of his primary residence. The loan is
secured by a recorded Deed of Trust. The initial interest rate to be charged was 5.25% through
August 31, 2008. On September 1. 2008, and on each September I following, until the loan is paid
off, the interest rate of the loan will be adjusted based upon the then reported quarter -to -date Local
Agency Investment Fund rate on the City's investment portfolio. As of June 30, 2011, the balance of
the loan was $529,475.
M
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
NOTE 5 - CAPITAL ASSETS
I
Changes in capital assets during the fiscal year consist of.
Less accumulated depreciation for:
Balance
Balance
Land improvements
Balance
(274,647)
_LLIne 30, 2010
Additions
Retirements
Transfers
June 30, 2011
Governmental Activities
(10,9614321)
(1,320,2374 250,186
(12,033,483)
Infrastructure
(93,622,',667(4,}314,304)
Capital assets not being depreciated,
_jLjI7,,17�1
Total accumulated depreciation
(118,837 836)
(7,545,706) 250,186
(126,133,356)
Land
$82,464,364
_(7,375145-i 3_06)
293,457 116,952,574 A
Total governmental activity capital assets
582,4164,364
Construction in Progress
1,714-752
$1,184,400
(834,134)
$293,457
2,570,961
Total capital assets not being depreciated
84,178,5-16
1,184,400
(34,134)_
457)
85,035,325
Capital assets being depreciated.
11,349,754
Less accumulated depreciation for,
Land improvements
8,2367061
($210,538) $8,1228
1,836,524)
Machinery and equipment
8,2367061
Buildings and structures
38,830,105
Total accumulated depreciation
2,214,782)
332.233)
38,830,105
Machinery and equipment
16,089,7788
1705461
(256,492)
Total business-t-ype activitv capital assets
16,003,757
Infrastructure
179,722,55$
293,45?
180 O16,012
Total capital assets being depreciated
L42,878,509
170,461
2_56492
293.457
243,085,435
Less accumulated depreciation for:
Balance
Balance
Land improvements
(4,161,681)
(274,647)
(4,438,328)
Buildings and structures
(11,224,475)
Machinery and equipment
(10,9614321)
(1,320,2374 250,186
(12,033,483)
Infrastructure
(93,622,',667(4,}314,304)
_jLjI7,,17�1
Total accumulated depreciation
(118,837 836)
(7,545,706) 250,186
(126,133,356)
Total net capital assets being depreciated
1124,042,L3
_(7,375145-i 3_06)
293,457 116,952,574 A
Total governmental activity capital assets
$208,219,189
�,190,845) ($40,440}$201,88-,,904
--
48
Balance
Balance
June 30, 2010
Additions Adjustment
June 30, 2011
Business -type Activities
Capital assets not being depreciated:
Land
$8,621).853
$8,620,853
Construction m progress
Total capital assets not being depreciated
8,620,853
8,620.853
Capital assets being depreciated,
Buildings and structures
10,234,52:1
10,234,521
Machinery and equipment
1,115,233
1,1 15,233
Total capital assets being depreciated
11,342,754
11,349,754
Less accumulated depreciation for,
Buildings and structures
(1,634,214)
($210,538) $8,1228
1,836,524)
Machinery and equipment
(580,568i
___(8,228)
(710,491)
Total accumulated depreciation
2,214,782)
332.233)
(2,547,015)
Total net capital assets beim depreciated
9,134.972
(332.233)
8;802,739
Total business-t-ype activitv capital assets
$17.755,825
($332,233,
$1 1,423,592
48
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
I NOTE 5 - CAPITAL ASSETS (Co
San Rafael Sanitation District
Capital assets not being depreciated:
Land and easements
Construction in progress
Total capital assets not being depreciated
Capital assets being depreciated:
Subsurface lines
Sewage collection facilities
General plant and administration
Total capital assets being depreciated
Less accumulated depreciation for:
Subsurface lines
Sewage collection facilities
General plant and administration
Total accumulated depreciation
Total net capital assets being depreciated
Total District's capital assets
Balance Transfers & Balance
June 30, 2010 Additions Adjustments June 30, 2011
$115,329 $115329
415,357 5,838,278 ($5,124,188) 1,129,447
530,686 5,838278 (5J24,188) 1»244,776
13,148,145 5,117,965 18,266,110
35,584,748 6,223 35,590,971
833,841 249,741 1,083,582
49,566,734 249,741 5J24,188 54,940,663_
(8,615,873) (245,916) (8,861,789)
(12,876,864) (829,300) (13,706,1641
(226,951) (64.414) (291,365)
(21,719,688) _qz.1�39,630- (22,859,318)
27,847,046 (889m9) 32,081,345
$28,377,732 --$.4,948,389-- (S5J24,188) $33,326,121
Capital Asset Contributions - Some capital assets may have been acquired using Federal and State grant
funds, or were contributed by developers or other governments. These contributions are accounted for as
revenues at the time the capital assets are contributed.
Depreciation Allocation - Depreciation expense is charged to functions and programs based on their
usage of the related assets. The amounts allocated to each function or program are as follows -
Governmental Activities
General government
Public safety
Public works and parks
Community development/redevelopment
Culture and recreation
Total Governmental Activities
Business -type Activities
Parking services
17otal Business -type Activities
M
$207,468
1,025,300
5,512,500
53,782
746,656
$7,545,706
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
NOTE 6 —NOTE PAYABLE
San Rafael Tax and Revenue Anticipation Note:
On July 14, 2010, the City authorized and issued 2010-11 Tax and Revenue Anticipation Notes
(TRANS) in the principal amount of $6,080,000. The TRANS were issued to finance City operating
expenditures until the City received its semi-annual property taxes, which were pledged for debt service
on the TRANS. The TRANS bore interest at 2% per year which was due along with principal on July
28, 2011. During fiscal 2010-11, City property taxes amounting to $14,527,137 represented 43% of the
$6,201,262 in principal and interest due and repaid on the TRAN.
NOTE 7 - LONG-TERM OBLIGATIONS
A summary of governmental and business -type activities transactions for the fiscal year ended June 30,
2011, are as follows;
Ground Lease Note Payable,
8.00%, due I lil2024 169,000 169,0000 169,000
Cour Fine Repayment Promissory Note,
3.873%,due November2011 1,133,458 363,328 239,106 124,222 124,222
Telephone System Capitalized Lease- Obligations,
4.28%,due 0530/2012 3',8.'100 135,330 66,2232 69,098 69-098
Total C,overnmentai Long -tem Debt S 3 1 023,646 $4,731,371 $'-,530-338 11, 110,119 $2.518,3210
Business -type Activities
2003 Aatho ity Leasee Revenue Bonds
3.004.70°fc- due 4,'V2033
Tota,, Fater -prise Fund Deb:.
San Rafael Sanitation District
2001 Certificates of Part-icipatum
3,2s-4,40%, tine 8/1!2012
Less: unan ortiaed discountissuance cost
71605.0cF $6,8'15,0 $175,090 S6,63"22 ____S] 85,0010
$6,,05, 00 1?75,000 S6,631,,000 5185,000
4,7, 10,000 $1,380,./0103
S440,000 $440,000 $940,000
30,299) (KU99)
S479,701 S940,000 $940,000
W
Authorized
Balance
Balance
Current
and Issued
June 30, 2010
Additions
Retrements
June 30, 2011
Portion
Governmental Activities:
San Rafael Redevelopment Agency
1999 Tax Allocation Bonds
Capital Appreciation Bonds
5.58%-5.6%, due 1211!2022
2,389,0004
$47362,803
$247,371
$4,6100,174
20,02 Tax Allocation Refunding Bonds
2.0{ 00%-5.25%, due 1211/2021
25,020,900
15,295,000
S1,350'000
13,945,000
$1,420,900
2009 Tax Allocation Refunding Bonds
3.004'x-5.09%, due 12/1/2022
14,660,000
14,660,000
875,000
13,185,000
905,00f"
Add: deferred bond premium costs
1,038,185
79 ,8860,
958,325
Total Tax Allocation Bonds
35,355,988
247,37/
2.225,000
33,298,499
2,325,000
2910 Taxable Pension Obligation Bonds
6%-6.25%, due 7{ii2025
4,490,000
4,490,000
4,490,009
Total Pension Obligation Bonds
4,490,000
4,490,000
Ground Lease Note Payable,
8.00%, due I lil2024 169,000 169,0000 169,000
Cour Fine Repayment Promissory Note,
3.873%,due November2011 1,133,458 363,328 239,106 124,222 124,222
Telephone System Capitalized Lease- Obligations,
4.28%,due 0530/2012 3',8.'100 135,330 66,2232 69,098 69-098
Total C,overnmentai Long -tem Debt S 3 1 023,646 $4,731,371 $'-,530-338 11, 110,119 $2.518,3210
Business -type Activities
2003 Aatho ity Leasee Revenue Bonds
3.004.70°fc- due 4,'V2033
Tota,, Fater -prise Fund Deb:.
San Rafael Sanitation District
2001 Certificates of Part-icipatum
3,2s-4,40%, tine 8/1!2012
Less: unan ortiaed discountissuance cost
71605.0cF $6,8'15,0 $175,090 S6,63"22 ____S] 85,0010
$6,,05, 00 1?75,000 S6,631,,000 5185,000
4,7, 10,000 $1,380,./0103
S440,000 $440,000 $940,000
30,299) (KU99)
S479,701 S940,000 $940,000
W
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
NOTE 7 - LONG-TERM OBLIGATIONS (Continued)
Long Term Debt
A. 1999 Tax Allocation Bonds and Capital Appreciation Bonds
On June 16, 1999, the Agency issued Tax Allocation Bonds in the amount of $23,504,004. The bonds
were issued as Current Interest Bonds in the aggregate principal amount of $21,115,000 and as Capital
Appreciation Bonds in the original amount of $2,389,004. The proceeds of the bonds were used to
finance certain redevelopment activities of benefit to the Agency's Central San Rafael Redevelopment
Project Area.
The Current Interest Bonds mature annually each December I from 2000 to 2022, in amounts ranging
from $560,000 to $1,460,000 and bear interest at rates ranging from 4.50% to 5.00%. Interest is
payable semiannually on June I and December 1, The Current Interest Bonds maturing on or after
December 1, 2008, are subject to optional redemption prior to maturity; in whole or in part, in
inverse order of maturity or on a pro rata basis among maturities, on any date on or after December 1,
2007, 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%.
In December, 2009 of the Agency exercised the redemption option. The outstanding balance of the
Bonds were refunded, on a current basis, through the issuance of the 2009 Tax Allocation Refunding
Bonds as discussed on Note 7D below.
The Capital Appreciation Bonds mature annually after December I from 2018 to 2022, in amounts
ranging from $1,440,000 to $2,070.000 and bear interest at rates from 5.58% to 5.60%. Interest on the
Capital Appreciation Bonds will compound on each interest premium date and will be payable solely at
maturity. The bonds are secured, on parity with the 1992 and 1995 bonds (refunded in 2002), by a
pledge and a lien on tax revenues and amounts on deposit in certain funds and accounts held by the
fiscal agent.
B. 2002 Tax Allocation Refunding Bonds
On October 9, 2001 the Agency issued Tax Allocation Refunding Bonds in the amount of $25,020,000.
The proceeds of the bonds were used to refund the 1992 Tax Allocation Refunding Bonds and the 1995
Tax Allocation Bonds. The Bonds mature annually each December I from 2002 to 2022, in amounts
ranging from $540,000 to $1.920,000 and bear interest at rates ranging from 2.00% to 5.215%. Interest is
payable semiannually on June I and December 1. The Bonds maturing on or after December 1. 2013,
are subject to optional redemption prior to maturity, in whole or in part, and by lot within any one
maturity, -prior to their respective maturity dates, on any date on or after December 1, 2012. at a price
equal to the principal amount, plus accrued interest on the redemption date. The bonds are payable
from tax revenues to be derived from the redevelopment activities of the Agency related to the Central
San Rafael Redevelopment Project Area.
a
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
NOTE 7 - LONG-TERM OBLIGATIONS (Continued)
C. 2009 Tax Allocation Refunding Bonds
On December 14, 2009, the Agency issued 2009 Tax Allocation Refunding Bonds in the amount of
$14,660,000 bearing interest at rates from 3.00% to 5.00%. The proceeds of the Series 2009 Bonds
were used to refund the Agency's 1999 Tax Allocation Current Interest Bonds, to advance funds to the
City to finance street and parking improvements for the benefit of the Agency's Central San Rafael
Redevelopment Project. Principal payments are due annually on December 30 and interest payable
semiannually on June 30 and December 30.
The Series 2009 Bonds maturing on or before December 1, 2019, are not subject to optional redemption
prior to their respective stated maturities. The Series 2009 Bonds maturing on or after December 1,
2020, are subject to optional redemption as a whole or in part either on a pro rata basis among
maturities or in inverse order of maturity, and by lot within any one maturity, prior to their respective
maturity dates, at the option of the Agency, on any date on or after December 1, 2019, at a price equal to
the principal amount of such Series 2009 Bonds called for redemption, together with interest accrued on
the date fixed for redemption, without premium.
The Agency has pledged all future tax increment revenues, less amounts required to be set aside in the
Low and Moderate Income Housing Fund, for the repayment of the 1999 Capital Appreciation Bonds,
and the 2002 and 2009 Tax Allocation Refunding Bonds. The pledge of all future tax increment
revenues ends upon repayment of $43 million in remaining debt service on the Bonds, which is
scheduled to occur in 2023. For fiscal year 2011 tax increment revenues amounted to $4.5 million and
debt service also amounted to $3.6 million,
D. 2010 Taxable Pension Obligation Bonds,
On July 1, 1010, the City issued 2010 Taxable Pension Obligation Bonds in the amount of $4,490,000
bearing interest at rates from 6,00% to 6.25%. Interest on the Bonds will be payable on January I and
July I on each year, commencing January 1, 2011. Principal payable on the Bonds will be paid on July
I starting July 1, 2016. The Bonds are being issued to prefund a portion of the obligations of the City to
the Marin County Employees' Retirement Association. Payment of the principal and interest on the
Bonds is not limited to any special source of funds and is payable from any legally available moneys of
the City. The City is not empowered or obligated to levy or pledge taxes to make payments to the
Bonds.
E. Ntote Payable
At June 30, 2011, Note Payable 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 finance the
purchase of certain property by the Agency,
52
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
INOTE 7 - LONG-TERM OBLIGATIONS (Continued)
F. Court Fine Repayment Promissory Note
On December 29, 2006, the City signed a promissory note in the amount of $1,133,458 to repay the
Superior Court of California, County of Marin. The purpose of the note is to repay the Superior
Court for over payment of court revenues.
. generated from traffic violations, made to the City from
the period July 1999 through June 2006. The note bears interest at 3.873% per annum. Principal and
interest are payable monthly commencing from January 2007 until December 2011.
G. Telephone System Capital Lease
On May 30, 2007, the City entered into a capital lease agreement in the amount of $318,000 to
purchase telephone related network equipment and services. Principal and interest payments are due
each May 30 and November 30, commencing November 30, 2007, until November 30, 2011. The
capital lease bears interest at 4.28% per annum.
H. 2003 Authority Lease Revenue Bonds
On March 26, 2003, the Authority issued 2003 Authority Lease Revenue Bonds in the amount of
$7,605,000 bearing interest at rates from 3.00% to 4.70%. The proceeds of the bonds were provided for
the design and construction of a new public Parking garage. The bonds mature annually each April I
from 2006 to 2033, in amounts ranging from $150,000 to $2190.000. Interest is payable semiannually on
April I and October I. The bonds maturing on or after April 1, 2011 are subject to optional redemption
prior to maturity on or after April 1, 2010 at the option of the City, as a whole on any date. As of June
30, 2011, no redemption has occurred. The Lease Revenues are secured by lease payments made by the
City to the Authority for leasing the City facilities.
L Discretely Presented Component Unit — San Rafael Sanitation District — 2001 Certificates of
Participation
The District and its Financing Corporation on May 1. 2001, issued $4.710,000 of Certificates of
Participation at a discount of $35,702. The certificates were to be used (1) to refund in whole the
outstanding Series 1991 Certificates of Participation, (2) to finance the District's share of a new
construction corporation yard, (3) to fund in whole or in part, a reserve fund for certificates, and (4) to
pay certain costs of issuing the certificates. The certificates are fully registered with principal due
annually on August I and interest payable semi-annually on February I and August 1. The certificates
are subject to optional prepayment on any date on or after August 1, 2009, Terms of the Trust
Agreement call for a premium at 101% to exercise optional prepayment between August 1, 2009, and
July 31, 2010, and no premium August 1, 2010, and after,
a
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
NOTE 7 - LONG-TERM OBLIGATIONS (Continued)
J Future Debt Services
Future debt service requirements, including interest and capital leases, at June 30, 2011, were as
follows:
For the Year
Ended June 3!
2012
2013
2014
2015
2016
2017 - 2021
2022 -2026
2027-2031
2032-2031
Totals
Reconciliation of long-term debt:
Less unaccredited discount
Less unamortized original issue discount
Acid deferred bond premium costs
40,412,320 $1x3,2704=7 $6,630,040 $4,315973
(3,219,826)
956,325
$38,150,819
54
940,004 $20180
$940000
Component Unit
Governmental
Activities
IIusu ess-tyne Activities
San Rafael Sanitation District
Principal
Interest
Principal
Interest
Principal Interest
52,518,320
$1,522,222
$185,o8C
$314,141
$940,000 $20,680
2,425,000
1,416,78;
1900070
305,741
2,540,000
1,300,088
200,000
299,141
275,040
1,1697/113
2035,000
291,141
2,800,040
1,043,438
215,000
282,085
17,465,000
3,195,382
1,225,0001
1 >4,41A
9,989,000
622,793
1,530,000
953 710
1,955,000
534,000
925.000
70.000
40,412,320 $1x3,2704=7 $6,630,040 $4,315973
(3,219,826)
956,325
$38,150,819
54
940,004 $20180
$940000
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
NOTE 8 — DEBT WITHOUT CITY COMMITMENT
The City has sponsored the issuance of the following debt, for which the City is not liable for
repayment but is only acting as an agent for the property owners and bondholders:
NOTE 9 — NET ASSETS AND FUND BALANCE
A. Net Assets
Net Assets is the excess of all the City's assets over all its liabilities, regardless of fund. Net Assets
are divided into three captions. These captions apply only to Net Assets, which is determined only at
the Government -wide level and business type activity and are described below:
Invested in Capital Assets, net of related debt describes the portion of Net Assets which is represented
by the current net book value of the City's capital assets, less the outstanding balance of any debt issued
to finance these assets.
Restricted describes the portion of 'Net Assets which is restricted to use by the terms and conditions of
agreements with outside parties, governmental regulations, laws, or other restrictions which the City
cannot unilaterally alter. These principally include assets restricted due to Redevelopment Ageney
bond covenants or low and moderate income housing loan agreements.
Unrestricted describes the portion of Net Assets which is not restricted to use.
N
Project
Original
Outstanding
Description
Amount
June 30, 2011
San Rafael Redevelopment Agency
162-175 Belvedere
Multifamily Housing Revenue Bonds
Apartments
53,590,529
$1,296,988
California Statewide Communities
Development Authority Revenue Bonds
St. Marks School
5,605,000
4,835,000
San Rafael Redevelopment Agency
Variable Rate Demand Multifamily
55 Fairfax
Housing Revenue Bonds
Apartments
3,000,000
2,600,000
San Rafael Redevelopment Agency
San Rafael Commons
Multifamily Housing Revenue Bonds -2001
Apartments
6,100,000
5,560,000
City of San Rafael
Kaiser Foundation
Variable Rate Revenue Bonds
Hospitals
275,000,000
195,630,000
San Rafael Redevelopment Agency
Martinelli House
Multifamily Housing Revenue Bonds -2007 Series A
Project
6,000,000
2,179,699
Multifamily Housing Revenue Bonds -2007 Series B
Martinelli House
1,000,000
278,704
NOTE 9 — NET ASSETS AND FUND BALANCE
A. Net Assets
Net Assets is the excess of all the City's assets over all its liabilities, regardless of fund. Net Assets
are divided into three captions. These captions apply only to Net Assets, which is determined only at
the Government -wide level and business type activity and are described below:
Invested in Capital Assets, net of related debt describes the portion of Net Assets which is represented
by the current net book value of the City's capital assets, less the outstanding balance of any debt issued
to finance these assets.
Restricted describes the portion of 'Net Assets which is restricted to use by the terms and conditions of
agreements with outside parties, governmental regulations, laws, or other restrictions which the City
cannot unilaterally alter. These principally include assets restricted due to Redevelopment Ageney
bond covenants or low and moderate income housing loan agreements.
Unrestricted describes the portion of Net Assets which is not restricted to use.
N
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
NOTE 9 — NET ASSETS AND FUND BALANCE (Continued)
B. Fund Balance
In the fund financial statements, fund balances represent the net current assets of each fund. Net
current assets generally represent a fund's cash and receivables, less its liabilities. The City's fund
balances are classified in accordance with Goverrimental Accounting Standards Board Statement
Number 54 (GASB 54), Fund Balance Reporting and Governmental Fund Type Definitions, which
requires the City to classify its fund balances based on spending constraints imposed on the use of
resources. For programs with multiple funding sources, the City prioritizes and expends funds in the
following order: Restricted, Committed, Assigned, and Unassigned. Each category in the following
hierarchy is ranked according to the degree of spending constraint:
Nonspendables represents balances set aside to indicate items do not represent available, spendable
resources even though they are a component of assets. Fund balances required to be maintained intact,
such as Permanent Funds, and assets not expected to be converted to cash, such as prepaids, notes
receivable, and land held for redevelopment are included. However, if proceeds realized from the sale
or collection of nonspendable assets are restricted, committed or assigned, then Nonspendable amounts
are required to be presented as a component of the applicable category.
Restricted fund balances have external restrictions imposed by creditors, grantors, contributors, laws,
regulations, or enabling legislation which requires the resources to be used only for a specific
purpose. Encumbrances and nonspendable amounts subject to restrictions are included along with
spendable resources.
Committed fund balances have constraints imposed by formal action of the City Council which may
be altered only by formal action of the City Council. Encumbrances and nonspendable amounts
subject to council commitments are, included along with spendable resources.
Assigned fund balances are amounts constrained by the City's intent to be used for a specific
purpose, but are neither restricted nor committed. Intent is expressed by the City Council or its
designee and may be changed at the discretion of the City Council or its designee. This category
includes encumbrances; Nonspendables, when it is the City's intent to use proceeds or collections for
a specific purpose, and residual fund balances, if any, of Special Revenue, Capital Projects and Debt
Service Funds which have not been restricted or committed.
Unassigned fund balance represents residual amounts that have not been restricted, committed, or
assigned. This includes the residual general fund balance and residual fund deficits, if any, of other
governmental funds.
56
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
NOTE 9 -NET ASSETS AND FUND BALANCE (Continued)
Detailed classifications of the City's
Fund Balances,
as of June 30, 2011, are below:
Major
Special Revenue Funds
Redevelcument
Traffic and
Agency
Other
General
Housing
Capital
Governmental
Fund
Mitigation Gas Tax
Project Fund,
Funds
Total
Fund balances:
Nonspenciable:
Loans receivable
$549,722
$62,858
$314,322
$926,902
PTepaids
40,111
--4-0-171 I
Total Nonspandable7,0
L89.83 3
_62,458 __314322
13
Restricted for:
Assessment Districts,, open space
76,015
76,01;
Court fine audit
124,223
124,223
Traffic and housing mitigation
9,093,397 197
9,093,397
Gas tax
51,138,226
1,138,226
Redevelopment &,ency capital projects
4,684,936
4,684,936
Recreation revolving
$148,038
148,038
Baypoint Lagoons Assessment District
151,771
151,7711
Household hazmat facility
132,527
132,527
Cliddeare
1,61- ' 7
1,617
Street maintenance and cleaning
545,248
545,248
Loch Lomond Assessment District
900,224
900,224
Library
128,867,
128,867
Public safety
201,731
201^31
Storm water
1,086,542
1,086,542
Grant,
620,900
620,900
Emergency medical services
146,542
146,542
Peacock Gap Assessment District debt service
2,875
2,$75
Mariposa Assessment District debt service
16,469
16,469
1997 financing authority revenue bonds debt service
145,196
145,186
Redevelopment Agency debt service
44,831
44,831
Capital improvement capital projects
_99 440
�99 441)
Total Restricted
200,238
9,043,397 1,138,226
4,684.936
_4372 808
19,489,605
Committed to:
Project development
555,561
555,561
Gas tax
28,816
29,816
Recreation revolving
50,356
50,356
Street maintenance and cleaning
92,391
82,395
Library
24,215
24,215
Library assessment
466,418
466,418
Development services
743,541
743,543
Parkland dedication
1,054,633
1,054,633
Business improvemen,
3,716
3,716
Capital improvement capital protects
9XI5
9,835
Bedroom tax capital projects
26,564
26,564
Redevelopment activities
1,120,000
1,120,000
Assessment District capital projects-
81_1
831
Total Committed
5_55 561
_28 816
1,12u,000
2.",15,506 506
4-419.883
Assigned to
Contingent liabilities
"3,4-16,1 -17
Coatractua: commitments
148,522
148,522
Ernercenc, and cash flow
1,521,°.80
1,321,180
Gas tax
27-33,751
271,77-1
Sewer maintenance
33,3733
33,373
Pali capital projects
29,473
29'4'3
Open space capital projects
13-7.915
137,975
Equipment replacement capital V, cjects
2,99i,41=4
Rad roreplacement capital projects
525,509
525.509
Redevelopment activist-xs
5'61;0
5,000
Telephone replacement capiud projects
--
534
127,5_ 4
Total Assigned
5.439,8'9
273;751
50X;0,845,278
�9563 908
otal F-,rui Balances
$6.%85.511
S9,156255 $1 440V,93
(61-41-2518
5110.93333.592
4,4404409
{'7
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
INOTE 10 — EMPLOYEES RETIREMENT PLAN
A. Plan Description
The City contributes to the Marin County Employees' Retirement Association (Association). All full-
time and permanent part-time employees who work at least 75% of a full time position are eligible, to
participate.
The Association 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 Association 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 having attained the age of 50, or 30 years of
service (20 years for safety employees) regardless of age. These benefits 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 from the Marin County Employees' Retirement
Association, which can be obtained from Marin County Employee's Retirement Association, 3501
Civic Center Drive, Room 408, Civic Center, San Rafael, California 94903.
B Funding Policy
The funding policy of the Association provides for actuarially determined periodic contributions by the
City at rates suchthat sufficient assets will be available to pay Fund benefits when due. The City
contributed 5168410 and 68,91% of payroll to Fund for Police and Fire personnel, respectively. and
34.90% for other covered employees for the year ended June 30, 2011
C Annual Pension Cost
The annual required contribution was determined as part of the actuarial performed as of June 30, 2010,
The employer rates for nomial cost is determined using the Entry Age Normal Actuarial Cost Method,
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 2010 actuarial
valuation include an assumed rate of return on invested assets of 7.75%, annual payroll increases
reflecting 3.5% for inflation and an approximate range of 0.50% to 8.00% for merit and longevity. The
actual rate of return on investments was a gain of 8.2%. 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 Association also uses the level percentage -open method to amortize the
unfunded actuarial liability which was revised to sixteen years level in the amortization period. It is
assumed that payroll will increase at an annual inflation rate of 4.00% over the amortization period. The
required contributions and related rates for the year ended June 30 were as follows:
Fiscal Year
Annual
Percentage of
Net
Ended
Pension Cost
APC
Pension
June 30
(APC}
Contributed
Obligation
2009
$13.746;154
100%
$o
2010
12,7145.613
100%
0
2011
15,409.519
100%
0
58
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
NOTE 10 — EMPLOYEES RETIREMENT PLAN (C
The Plans' actuarial value (which differs from market value) and funding progress over the most recent
three years available is set forth below at their actuarial valuation date of June 30:
NOTE 11 - PUBLIC AGENCY RETIREMENT SYSTEM (DEFINED CONTRIBUTION
RETIREMENT PLANS)
The City contributes to the Public Agency Retirement System (PARS), which is 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 accounts are determined instead of specifying the amount of benefits the individual is
to receive. The plan is administered by Phase H located at P.O. Box 10009, Costa Mesa, California
92627.
Under a defined 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 non represented employees of the City will become participants
in the plan from the date that they 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.
As determined by the plan, each employee must contribute 3.715% of gross earnings to the plan. The
City contributes an additional 3.75% of the employee's gross earnings. Contributions made by an
employee and the employer vest immediately.
a
Actuarial
Excess
Excess (Deficit)
Actuarial
Actuarial
Accrued
(Deficit)
Assets Over AAI
Valuation
Value
Liability (A -AL)
Assets
Funded
Covered
As a % of
Date
of Assets
Entry Age
Over AAL
Ratio
Payroll
Payroll
_73-0108
$262,677,000
$360,298,000
($97,621,000)
73%
$31,854.000
(306%)
6/30/09
239,841,000
379,801,000
(139,960t000)
63%
32,413,000
(432-/�)
6730710
248,500,000
394,889.000
(146,389,000)
63%
30,320,000
(483%)
NOTE 11 - PUBLIC AGENCY RETIREMENT SYSTEM (DEFINED CONTRIBUTION
RETIREMENT PLANS)
The City contributes to the Public Agency Retirement System (PARS), which is 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 accounts are determined instead of specifying the amount of benefits the individual is
to receive. The plan is administered by Phase H located at P.O. Box 10009, Costa Mesa, California
92627.
Under a defined 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 non represented employees of the City will become participants
in the plan from the date that they 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.
As determined by the plan, each employee must contribute 3.715% of gross earnings to the plan. The
City contributes an additional 3.75% of the employee's gross earnings. Contributions made by an
employee and the employer vest immediately.
a
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
NOTE 11 - PUBLIC AGENCY RETIREMENT SYSTEM (DEFINED CONTRIBUTION
RETIREMENT PLANS) (Continued)
During the year, the City and employees contributed $69,256. The total covered payroll of employees
participating in the plan for the year ended June 30, 2011, was $1,846,827. The total payroll for the
year was $37,248,008.
Additionally, the City participates in a 401(a) tax qualified plan for eligible non -represented
management/mid-management employees. This is an employer only contribution program separate
from the Marin County Employees' Retirement Association. The City Manager, as Plan Administrator,
annually determines the percent amount of contribution which can range from 0% to 5% of base salary
of eligible employees. During the year, the City contributed $140,271 to the plan on behalf of the
eligible employees.
NOTE 12 — POST -EM - PLOY WINT 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 Association
within 120 days of retirement from City employment. At June 30, 2011, 298 retirees and surviving
spouses received post -employment health care benefits. Those expenditures are reduced by
reimbursements from the Marin County retirement Office by 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.
Theprovisions and benefits of the City's Other Post Employment Benefit Plan, in effect at June 30,
2011, are summarized as follows:
Z
Elected Officials, Mid -Management,
I
& Unrepresented Management
All other Bargaining Units
Efigibility,
Retire directly from the City:
Age 50 with 10 years services OR
30 years service (Miscellaneous). 20
years service (Safety) OR
Disability Retirement
Benefit
Hired 5111,09 Full premium/cap
Hired -5 1/IA 0 Up to cap
Hired > 1.`1/09 PEMHCA Min
Hired > 1:' 1 /10 PEMHCA Min
Surviving
Spouse Benefit
Continuation to surviving spouse
Medicare Part B
Hired < 41/1"07 Full reimbursement
None
Hired > 4! 1/07 None
Other
No Dental, Vision, or Life Benefits
Z
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
I NOTE 12 — POST -EMPLOYMENT HEALTH CARE BENEFITS (Continued) I
Funding Policy and Actuarial Assumptions
The annual required contribution (ARC) was determined as part of a June 30, 2009, actuarial
valuation using the entry age normal actuarial cost method. This is a projected benefit cost method,
which takes into account those benefits that are expected to be earned in the future as well as those
already accrued. The actuarial assumptions included (a) 4.50% investment rate of return and (b)
3,50% of general inflation increase, and (c) a healthcare trend of declining annual increases ranging
from 9.80% in 2012 to 5.00% for years starting 2018. In addition, the fixed dollar benefit amounts
are assumed to increase according to general inflation in the future and the premium related benefits
are assumed to increase with the healthcare trend rate. The actuarial methods and assumptions used
include techniques that smooth the effects of short-term volatility in actuarial accrued liabilities and
the actuarial value of assets. Actuarial calculations reflect a Iona -term perspective and actuarial
valuations involve estimates of the value of reported amounts and assumptions about the probability
of events far into the future. Actuarially determined amounts are subject to revision at least
biannually as results are compared to past expectations and new estimates are made about the future.
The City's OPER unfunded actuarial accrued liability is being amortized as a level percentage of
projected payroll using a maximum 30 year combined amortization period.
Funding Progress and Funded Status
During the fiscal year ended June 30, 2011, the City has recorded a Net OPER Obligation in the
Statement of Net Assets, representing the difference between the ARC and actual contributions, as
presented below:
Amounts
(in thousands)
Annual required contribution (ARC) $4,025
Interest on net OPER obligation 335
Adjustment to annual required contribution (492)
Annual OPER cost 3,868
Contributions made:
Benefits payment 2,648
Trust prefunding (1,000)
Total contributions 1,648
Change in net OPER obli.-ation,`(asset) 2,220
Net OPER Obligation (Asset) at June 30, 21010 61265
Net OPEB Obligation (Asset) at June 30, 2011 $8,485
61
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
INOTF 12 - POST-EMPLOY-MENT HEALTH CARE BENEFITS (Continued) I
In accordance with the City's budget, the City's annual contributions to the Plan are based on pay-as-
you-go financing. Generally accepted accounting principles permit assets to be treated as OPER
assets and deducted from the Actuarial Accrued Liability when such assets are placed in an
irrevocable trust or equivalent arrangement. Contributions a 401 (h) account held and administered
by the MCERA were made by the City in prior years and were included in the June 30, 2009,
actuarial study. During the fiscal year ended June 30, 2011, the City has calculated and recorded the
Net OPER Obligation, representing the difference between the ARC, and contributions, as presented
below:
Annual
Annual
Pension Cost
Required
(000's omitted)
Contribution
Fiscal Year
(ARC)
Ended
(000's ornifted)
June 30, 2009
$4,269
June 30, 2010
4,390
June 30, 2011
4,025
Annual
Actual
Pension Cost
Contribution
(000's omitted)
_(220"s omitted)
$4,269
$2,236
5,576
1,344
3,868
1,648
Percentage Net OPEB
of ARC Obligation
Contributed (000's omitted)
52% 52,033
31% 6,265
41% 8,485
The Schedule of Funding Progress presents trend information about whether the actuarial value of
plan assets is increasing or decreasing over time relative to the actuarial accrued liability for benefits.
Trend data from the June 30, 2009, actuarial study is presented below:
62
Overfunded
(Underfunded)
Actuarial
Actuarial
Unfunded
Liability as
Value of
Accrued
Accrued
Covered
a Percentage of
Valuation
Assets
Liability
Liability
Funded
Payroll
Covered
Date
(000's omitted)
(000's omitted)
(000's omitted)
_Ratio
(000's omitted)
Payroll
6/30/2007
$14,563
$52.767
($38,204)
28%
$38,480
-99.28%
6/3012009
12,773
56,262
(43,489)
23%
36,470
-119,25%
62
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
INOTE 13 — JOINTLY GOVERNED ORGANIZATIONS
The City participates in the jointly governed organizations discussed below through form4lly 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 Agreements 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. Each joint organization is
governed by a board consisting of representatives from member municipalities. Each board controls the
operations of the respective joint organization, including selection of management and approval of
operating budgets, independent of any influence by member municipalities beyond their representation
on that board. Obligations and liabilities of this joint organization are not the City's responsibility and
the City does not have an equity interest in the assets of each joint organization except upon dissolution
of the joint organization,
A. The Marin County Integrated On -Line Library System (System)
The Marin County Integrated On -Line Library System was formed to provide for the procurement,
ownership, operation, maintenance, and governance of an integrated on-line 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
participant 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 1739% of ownership in the System. Operating costs for the System are also shared by
each participant by applying the cost sharing formula. The City contributed $124,02225 to the System
for operating costs for the year ended June 30, 2011, Financial statements of the System can be
obtained at the County Librarian, Marin County Free Library, Civic Center, Administration Building,
San Rafael, California 94903.
B. The Marin General Services Authority (MGS.4)
The MGSA was formed by the County of Marin and twelve local agencies to acquire street light
facilities, operate the facilities during the tendency of an eminent domain action against PG&E, and
the subsequent transfer of the facilities to the individual local agencies. Each of the local agency's
share of contributions was based on the number of street lights to be acquired in the local agency's
individual jurisdiction in relation to the total number of street lights to be acquired by the MSLAJPA.
The City's contribution to MGSA was $3,134 for the year ended June 30, 2011. Financial statements
of the MGSA can be obtained at 27 Commercial Boulevard, Suite C. Novato, CA 94949.
63
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
NOTE 13 — JOINTLY GOVERNED ORGAN11ZATIONS (Cont
C. The 111arin Emergency Radio Authority (MER4)
MERA was formed on February 28, 1998, by the County of Marin and 25 local agencies within the
County to plan, finance, implement, manage, own, and operate a County -wide public safety and
emergency radio system. The Governing Board consists of one representative from each member.
On February 1, 1999, the Authority issued the 1999 Revenue Bonds in the amount of $26,940,000
with interest rates ranging from 4.75% to 5.01%, maturing on August 15, 2016, to finance the
acquisition and installation of the system. The costs of maintenance, operation, and debt service will
be divided on a pro rata share based on an agreed-upon formula established by a majority of the
Governing Board, The members entered into a Project Operating Agreement on February 1, 1999.
Under the Operating Agreement, members are obligated to contribute service payments to cover the
Authority's operation and debt sen•ice. The City's portion of the obligation is 16.913%. The first
operating service payment was in July 1999. The first debt service payment was in August 2002,
The City contributed $255,876 for the Authority's operation and debt service for the fiscal year
ended June 30, 2011. The City has established a reserve in its internal service funds to pay future
service payments. Financial statements of the MERA can be obtained at 3501 Civic Centre Drive,
San Rafael, California 94903.
D. The Countywide Planning Agency
The 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 Countrywide Planning Agency consists of one
member of the County Board of Supervisors and one member of the City Council of each
participating city. Financial statements of the Agency can be obtained at 3501 Civic Center Drive,
San Rafael, California 94903.
E. The Marin Telecommunications Agency
The Agency was established to regulate the rates for cable television service and equipment and to
advise the participants of their license authority. The Governing Board of the Marin
Telecommunications Agency consists of one member from each of the eleven participating agencies,
The City's contribution to the Agency was $84,879 for the year ended June 30, 2011. Financial
statements of the Agency can be obtained at 371 Bel Marin Keys Blvd, Suite 100, Novato, CA
94949.
F. The Marin Couniy Hazardous and Solid Waste Joint Powers Authority
The Authority was established by the County, local cities, and waste franchising districts to finance,
prepare and implement source reduction and recycling elements on a county -wide integrated waste
management plan as required by State Assembly Bill 939. The City's contribution to the Authority
was $13,220 for the year ended June 30, 2011. Financial statements of the Authority can be obtained
at 3501 Civic Center Drive, San Rafael, California 94903.
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
INOTE 13 — JOINTLY GOVERNED ORGANIZATIONS (Cont
G. Friends of San Rafael
Friends of San Rafael is a California nonprofit Public Benefit Corporation established to help finance
and accomplish the City's efforts to erect, construct and maintain public buildings, roads,
monuments, plazas.
, parks, gardens, safety features and similar public improvement and
infrastructure. Financial statements of the Corporation can be obtained at P.O. Box 151560, San
Rafael, CA 94915.
I NOTE 14 - RISK MANAGEMENT
The City manages risk by participating in the public entity risk pools described below and by retaining
certain risks.
Public entity risk pools are formally organized and separate entities established under the Joint Exercise
of Powers Act of the State of California. As separate legal entities, those entities exercise fall powers
and authorities within the scope of the related Joint Powers Agreements 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. Each risk pool is governed by a board consisting of representatives from member
municipalities. Each board controls the operations of the respective risk pool, including selection of
management and approval of operating budgets, independent of any influence by member municipalities
beyond their representation on that board. Obligations and liabilities of these risk pools are not the
City's responsibility.
A. Risk Coverage
Liability Coverage
The City is a member of the California Joint Powers Risk Management Authority (CJPRNtA) which
covers general liability claims up to $40,000,000. The City also purchases commercial insurance for
property damage claims with an insured amount of $100,967,912. The City is self-insured up to a
maximum of $500,000 for each general liability claim and $215,000 for each property damage claim.
Once the self-insured retention is met CJPR-MA becomes responsible for payment of all claims up to the
limit. During the fiscal year ended June 30, 2011, the City contributed $221,808 for coverage during the
current year and received a refund of $154,687 of prior year excess contributions. Financial statements
for the risk pools may be obtained from CJPRMA, 2333 San Ramon Valley Blvd,, Suite 250, San
Ramon, CA 95608.
Workers' Compensation Coverage
The City purchased insurance for workers' compensation through AIG Excess Workers' Compensation
and Employers Liability Insurance with coverage up to statutory limits, The City is self-insured up to a
minimum of $750,000 for each worker's compensation claim.
M
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
INOTE 14 - RISK MANAGEMENT (Continued) I
The contributions made to each risk pool equal the ratio of their respective payrolls to the total payrolls
of all entities participating in the same layer of each program, in each program year. Actual surpluses or
losses are shared according to a formula developed from overall loss costs and spread to member
entities on a percentage basis after a retrospective rating.
B. Insurance Internal Service Funds
The Governmental Accounting Standards Board (GASB) requires municipalities to record their liability
for uninsured claims and to reflect the current portion of this liability as an expenditure in their financial
statements. As discussed above, the City has coverage for such claims, but it has retained the risk for
the deductible or uninsured portion of these claims.
The City's liability for uninsured general liability claims and workers* compensation claims, including
claims incurred but not reported, are reported in the Statement of Net Assets. The liability is based on
historical trend information provided by its third party administrators and was computed as follows at
June 30:
The claims settlements have not exceeded insurance coverage for the past three years.
INOTE 15 - COM-11MIT-TNIENTS AND CONTLNGENCIIWLFS
The City is subject to litigation arising in the normal course of business. In the opinion of the City
Attorney there is no pending litigation which is likely to have a material adverse effect on the
financial position of the City.
In 2004, the City of San Rafael entered into a Settlement Agreement with the federal Department of
Justice to bring City managed programs, activities, services and facilities into compliance with the
Americans with Disabilities Act (ADA). The City, has made significant progress over the past seven
years and is in the process of completing the few remaining projects identified in the Settlement
Agreement.
M
General
Workers'
Totals. as of June 30
Liability _
Compensation
2011
2010
Balance, beginning of year
$517,694
S3,080,893
S3,598,587
$3,716,971
Current year claims and changes
in estimates
466,7798
1,920,491
2,387;289
1,000,464
Claims paid
(549,776)
(1,465,923)
(2,015fi99)
(1,118,848)
Balance, end of year
$431,716
$3,535,461
$3.970.177
$3,598,587
Current portion
$300,000
$1,900,000
$2,200,000
$2,200,000
The claims settlements have not exceeded insurance coverage for the past three years.
INOTE 15 - COM-11MIT-TNIENTS AND CONTLNGENCIIWLFS
The City is subject to litigation arising in the normal course of business. In the opinion of the City
Attorney there is no pending litigation which is likely to have a material adverse effect on the
financial position of the City.
In 2004, the City of San Rafael entered into a Settlement Agreement with the federal Department of
Justice to bring City managed programs, activities, services and facilities into compliance with the
Americans with Disabilities Act (ADA). The City, has made significant progress over the past seven
years and is in the process of completing the few remaining projects identified in the Settlement
Agreement.
M
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
FNOTE 15 - COMMITMENTS AND CONTINGENCIES (Continued)
Among those projects is the construction of 800 curb ramps throughout San Rafael. As of October
2011, the City has construction 354 ramps with plans to install the remaining ramps over the life of
the Agreement, which expires in 2014.
On October 1, 2002, the City of San Rafael Redevelopment Agency entered into a second amendment
to Section 33401 Tax Sharing Agreement with San Rafael High School District. This agreement
provides for additional payrrierits in the amount of $179,000 each fiscal year beginning with fiscal
year 2002-03 through fiscal year 2021-22,
I NOTE 16 — SUPPLEMENTAL EDUCATION REVENUE AUGMENTATION FUND (SERAF)
The State of California adopted AB26 4X in July 2009 which directs that a portion of the
incremental property taxes received by redevelopment agencies, based on the property taxes
received in fiscal year 2006-07, be paid instead to the County supplemental educational revenue
augmentation fund (SERAF) in fiscal years 2009-10 and 2010-11. The State Department of
Finance determines each agency's SERAF payment by November 15 of each year, and payments
are due by May 10 of the applicable year. The Agency made its final SERAF payment of $282,450
in fiscal year 2010-11.
I NOTE 17 — SUBSEQUENT EVENTS I
A. Tax and Revenue Anticipation Notes
Subsequent to June 30, 2011, the City of San Rafael issued the 2011-12 Tax and Revenue
Anticipation Notes (TRANS) in the principal amount of $6,000,000 which is due on August 3, 2012,
along with unpaid interest accruing. TRANs are short-term, tax-free bonds issued for the purpose of
covering potential cash-flow deficits for governmental agencies that rely heavily on property tax
distributions as a source of revenue. The City is issuing the TRANS to bridge the gap between its
regular flow of operating expenditures and the receipt of its semi-annual property, taxes. The City
does not expect any direct fiscal impact from the issuance of the TR.,,sNs because the actual size of the
issuance is based on the City's anticipated cash flow needs. The TRATNI is repayable from future City
property tax revenues.
B. Proposed Dissolution of Redevelopment Agencies
In an effort to balance its budget, the State of California adopted Al3xI 26 on June 28, 2011, which
suspends all new, redevelopment activities except for limited specified activities as of that date and
dissolves redevelopment agencies effective October 1, 201 i, The State simultaneously adopted ABxl
217 which allows redevelopment agencies to avoid dissolution by the City` opting into an "alternative
voluntary redevelopment program" requiring specified substantial annual contributions to local
schools and special districts. Concurrently with these two measures, the State passed various budget
and trailer bills that are related and collectively constitute the Redevelopment Restructuring Acts, If
all sponsoring communities were to opt -in to the voluntary program, these contributions amount to an
-
estimated $1.1 billion for fiscal year 201'� and an estimated 5400 million in each succeeding year. If
the City fails to make the voluntary program payment, the Agency would become subject to the
dissolution provisions of ABxl 216.
67
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
I NOTE 17 — SUBSEQUENT EVENTS (Continued) I
On July 18, 2011, the California Redevelopment Association, the League of California Cities and
others challenged the validity and constitutionality of ABxI 26 and 27 to the California Supreme
Court on numerous grounds, including that the acts violate certain provisions of the California
Constitution, On August 11, 2011, as modified on August 17, 2011, the California Supreme Court
agreed to hear the case and issued a partial stay of ABxI 26 and a full stay of ABxI 27, but the stay
did not include the section of ABxI 26 that suspends all new redevelopment activities. It is
anticipated that the Court will render its decision before January 15, 2012, the date the first voluntary
program payment is due.
The suspension provisions of ABxI 26 prohibit all redevelopment agencies from a wide range of
activities, including incurring new indebtedness or obligations, entering into or modifying agreements
or contracts, property,
acquiring or disposing of real , taking actions to adopt or amend redevelopment
M I I
plans and other similar actions, except actions required by law or to carry out existing enforceable
I i
obligations, as defined in ABxI 26. During the suspension period, an agency s required to prepare an
Enforceable Obligation Payment Schedule no later than August 29, 2011, that allows it to continue to
pay certain obligations. The Agency Board adopted its Enforceable Obligation Payment Schedule
(FOPS} on September 6, 2011. The San Rafael City Council and San Rafael Redevelopment Agency
Board have chosen to participate in the Voluntary Alternative Redevelopment Program pursuant to
Part L9 of the California Community Redevelopment Law. The City Council's intention was verified
by the passage of Ordinance 1899 on September 19, 2011.
In addition, the suspension provisions require the State Controller to review the activities of all
redevelopment agencies to determine whether an asset transfer between an agency and any public
agency occurred on or after January, 1, 2011. If an asset transfer did occur and the public agency that
received the asset is not contractually committed to a third party for the expenditure or encumbrance
of the asset, the State Controller is required to order the asset returned to the redevelopment agency,
The State Controller's Office has not yet provided any information about the timing or the process for
this statewide asset transfer review.
The Agency is currently subject to the suspension provisions as described above. These facts indicate
that there is more than a remote possibility the Agency may not continue as a going concern beyond
October 1, 2011. The continuation of the Agency beyond October 1, 2011 will initially depend upon
whether the Supreme Court rules in favor of the petitioners. There are three possible consequences to
the Agency from a decision of the Supreme Court, when it is rendered:
If the Supreme Court detennines that both ABx1 26 and ABxl 217 are valid, then the City will
consider whether it will enact an ordinance to opt -in to the alternative voluntary redevelopment
program. If enacted. the City would be required to make annual payments to the County Auditor -
Controller and the Agency would no longer be subject to the suspension provisions. The State
Department of Finance calculated the City's Voluntary Program payment for fiscal year 2012 to be
5299,490.
M
CITY OF SAN RAFAEL
NOTES TO BASIC FINANCIAL STATEMENTS
For the Year Ended June 30, 2011
INOTE 17 — SU-BSEQLTENT EVENTS (Continued) I
If the Supreme Court determines that both ABxI 26 and ABxI 27 are valid and the City decides not
to participate in the alternative voluntary redevelopment program, or if the Supreme Court determines
that ABxl 26 is valid, but ABxI 27 is not valid, the Agency will continue to be subject to the
suspension provisions and would be dissolved in accordance with certain provisions of ABxI 26.
Prior to dissolution, any transfers of Agency assets subsequent to January 1, 2011 to the City, that
were not obligated to third parties or encumbered may be subject to the State Controller's review
discussed above and required to be returned to the Agency. Upon dissolution, all assets and
obligations of the Agency would be transferred to a successor agency.
If the Supreme Court determines that both ABxl 26 and ABxI 27 are invalid, the Agency would no
longer be subject to the suspension provisions and would continue in existence under California
Redevelopment Law as it existed prior to the enactment of ABx 1 26 and ABx 1 27.
As of October 28, 2011, the Supreme Court has not ruled on the case and the Agency is subject to the
suspension provisions as discussed above,
M
This Page Left Intentionally Blank
REQUIRED SUPPLEMENTAL INFORMATION I
a
This Page Left Intentionally Blank
GENERAL FUND AND MAJOR SPECIAL REVENUE FUND
BUDGET -TO -ACTUAL STATEMENTS
GASB Statement 34 dictates that budget -to -actual information in the basic financial statements should be
limited to the General Fund and major Special Revenue Funds. This section is provided for the presentation
of Budget -to -Actual Statements for the General Fund, Traffic and Housing Mitigation, and the Gas Tax
Special Revenue Funds.
CITY OF SAN RAFAEL
GENERAL FUND
SCHEDULE OF REVE'_vUES, EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2011
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES
(1,766,056)
(1,856,641)
(674,367)
Variance with
OTHER FINANCING SOURCES (USES)
Final Budget
Transfers in
Budgeted Amounts
Actual
Positive
(806,415)
Original
Final
Amounts
(Negative)
REVENUES
Total Other Financing Sources (Uses)
1,715,204
1,724,084
658,083
Taxes and special assessments
$41,678,130
$41,938,136
342,346,707
5408,577
Licenses and permits
1,228,224
1,228,224
1,416,772
188,548
Fines and forfeitures
742,546
742,540
862,820
120,280
Use of money and properties
198,860
140,076
148,213
8,137
Intergovernmental
6,698,780
6,698,780
6,645,495
(53,285)
Charges for services
1,7841164
1,784,164
1,819,641
35,477
Other revenue
127,780
16',780
395,558
227,778
Total Revenues
52,438,478
52.699,694
53,635,206
935,512
EXPEND1TtTRES
Current:
General government
7,456,047
7,088,476
6,789,829
298,647
Public safety
33,418,610
33,681,198
34,098,697
(417,499)
Public works and parks
7,874,226
7,967,785
7„475,774
492,611
Community development/redevelopment
3,010,108
3,006,276
1674,897
(68,627)
Culture and recreation
2,142.429
y
2,124,336
2,211,633
(86,697)
Capital outlay
44,850
54,850
162,267
(1011,417)
Capital improvement/special projects
33,060
35,560
152,814
(117,314)
Debt service:
Principal
239,876
239,870
239,166
764
Interest and fiscal charges
357,450
105,156
251294
Total Expenditures
54,218,534
54,555,735
54,309,573
246,162
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES
(1,766,056)
(1,856,641)
(674,367)
1,181,674
OTHER FINANCING SOURCES (USES)
Transfers in
3,742,446
3,753,106
2,946,685
(806,415)
Transfers out
(2,027,200)
(1629,016)
(2,288,602)
(259,586)
Total Other Financing Sources (Uses)
1,715,204
1,724,084
658,083
(1,066,661)
Net Change in Fund Balances
($44,856)
(5131,957)
(16,284)
$115;673
FUND BALANCES, BEGIN'NINC OF YEAR
6,801,795
FIND BALANCES. S. END OF YEAR
S6 785.511
74
CITY OF SAN RAFAEL
TRAFFIC AND HOUSING MITIGATION` SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2011
REVENUES
Use of money and properties
Charges for sen ices
Total Revenues
EKPFNDITURFS
Current:
Public works and parks
Total Expenditures
EXCESS (DEFICIENCY) OF REVENUES
OVER {UNDER) EXPENDITURES
Net Change in Fund Balances
FUND BALANCES, BEGIN \IIN(i OF YEAR
FUND BALANCES, END OF YEAR
75
($47,970} $108,396
1,667 ($106,729)
9,154,588
$9,156,255
Variance with
Final Budget
Budgeted Amounts
Actual
Positive
Original
Final
Amounts
(Negative)
$21,000
$176,8314
$4',928
($128,906)
22,115
22,115
21,000
176,834
70,043
{106,791}
68,970
68,438
68,376
62
68,970
68,438
68.376
62
(47,970)
108,396
1,667
(106,729)
75
($47,970} $108,396
1,667 ($106,729)
9,154,588
$9,156,255
CITY OF SAN RAFAEL
GAS TAX SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 38, 2811
EXPENDITURES
Variance with
Current:
Final Budget
Budgeted Amounts
Actual
Positive
28,447
Original Final
Amounts
(Negative)
REVENUES
595,162
701,403
(106,241)
Use of money and properties
$32,860 525,044
$10.98"
($14,057)
Intergovernmental
1,375,550 2,421,949
2,700,09;
278,146
Charges for services
—(1 ,500,93 1)
528,261
528,261
Other rev enue
83,615
83,615
Total Revenues
1,408,410 2,446,993
3,322,958
875,965
EXPENDITURES
Current:
Public works and parks
28.135
28,447
18,790
9,657
Capital outlay
595,162
701,403
(106,241)
Capital improvement/special projects
1,027,946
2,432,293
(1,404,347)
Total Expenditures
28,135
1,651,555
3,152,486
—(1 ,500,93 1)
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES
1,380,275
795,438
170,472
(624,966)
OTHER FINANCING SOURCES (USES)
Transfers in
520,000
520,0{00
Transfers (out)
(15404,050)
(1 404.050)
(1,301,119)
102,931
Total Other Financing Sources (Uses)
(1,404,050)
(884,040)
(;81,119)
102,931 1
Net Change in Fund Balances
($23,775)
($88,612)
($610,647)
(5522,035)
FUND BALANCES, BEGINNING OF YEAR
2,051,440
FUND BALANCES, END OF YEAR
51,440.793
In
77
CITY OF SAN RAFAEL
REDEVELOPMENT AGENCY CAPITAL PROJECTS FL,��D
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2011
REVENUES
Taxes and special assessments
Use of mane; and properties
Intergovernmental
Charges for services
Other revenue
Total Revenues
EXPENDITURES
Crirrentr
General government
Public works and parks
Community developmendredevelopment
Capital outlay
Capital improvement/special projects
Total Expenditures
OTHER FINANCING SOURCES (USES)
Proceeds from sale of capital asset
Transfers in
Transfers (out)
Total Other Financing Sources i Uses)
Net Assets (Accumulated Deficit), beginning of year
OVER (UNDER) EXPENDITURES
Net Change in Fund Balances
FUND BALANI ES. BEGINNING OF YEAR
F1JND BALANCES, END OF YEAR
W
6,754.433
$6,124,258
Variance with
Final Budget
Budgeted Amounts
Actual
Positive
Original
Final
Amounts
(Negative)
$900000
$900,000
.$936,383
$36,383
193,710
102,385
60,464
(41,921)
20,000
(20,000)
13,580
13,250
29,525
16,275
109,020
109,020
1,107,290
1,035,635
1,135,392
99,757
42,090
34,673
40,481
(5,808)
108,450
108,324
106,893
1,431
1,611,060
1,641,702
1,452.454
189,248
623,120
549,620
307,118
242,502
2384,720
2,334,319
1,906,946
427,373
433,309
141,379
(291,9301
(291,930)
291,930
141,379
141,379
(1,277,430)
(1,157,305)
{630,175}
527,130
($1,277,430)
(51,157,305)
(630,175)
5527,130
W
6,754.433
$6,124,258
NON -MAJOR GOVERN -MENTAL FUNDS
SPECIAL REVENUE FUNDS
Recreation Revolving Fund — Established to administer the Recreation Department's program and
facility rental charge and accounts for the Recreation Memorial Fund.
Baypoint Lagoons Assessment District Fund — The Baypoint Lagoons Lighting and Landscape
District was formed to protect and enhance wildlife habitat and water quality in Baypoint (Spinnaker)
Lagoon and the adjacent diked salt marsh.
Household Hazmat Facility Fund - Established to account for State mandated hazardous
materials information, collection, and reporting, Expenditures include inspection of businesses for
compliance with regulations. This fund also serves as the depository for countywide Household
Hazardous Waste Program.
Childcare Fund — Established to administer and account for childcare programs at eleven sites
throughout the City.
Street Maintenance and Cleaning Fund — Established to maintain the City's streets, pubic
properties and rights of way.
Loch Lomond Assessment District Fund — Established to provide maintenance for stormwater and
geotechnic mitigation facilities. A Mello Roos District was formed to fund this maintenance.
Library Fund — Established to account for restricted library activities that are intended to be self -
funding.
Library Assessment Fund — Established to account for a special parcel tax dedicated to public
library services and facilities, equipment, and technology improvements.
Public Safety Fund — Established for special police services, which are intended to be self -funding,
Stormwater Fund — Established to provide for self -funding storm drain maintenance program plus
separate programs through the County and Bay Area to educate residents about urban runoff
pollution.
Development Services Fund — Established to account for development activities that are supported
by external sources of funds. This fund does not account for the operating costs of building,
planning, and engineering, which are located in the General Fund,
Grants Fund — Established to account for grants for the Library, Childcare, Police and Falkirk
Cultural Center.
Parkland Dedication Fund — Established to account for long-term developer deposits used to
enhance and maintain the park structure within City limits.
Emergency Medical Services Fund — Established to account for the Emergency Medical Services
and Transportation program that provides services to all segments of the community.
79
NON ,'MAJOR GOVERNMENTAL FUNDS
Business Improvement Fund — Established to account for activities held in Downtown San Rafael,
such as the Farmers Market.
Sewer Maintenance Fund — Established under the terms- of the JPA to provide all necessary
maintenance to the Sanitation District's gravity collection sewer system.
DEBT SERVICE FUNDS
Peacock Gap Assessment District Fund — Established to accumulate funds for the payment of
principal and interest for the 1993 Bonds which mature in 2005. The proceeds were used to refund
the 1984 Bonds, which provided for the construction of public improvements in the project area.
Financing is to be provided by property tax increments generated within the specific geographic
region described by the bond assessment district.
Mariposa Assessment District Fund - Established to accumulate funds for the payment of principal
and interest for the 1993 Bond, which matures in 2008. The proceeds were used to finance the
grading and paving of Mariposa Road.
1997 Financing Authority Revenue Bonds Fund — Established to accumulate funds for the
payment of principal and interest for the 1997 Revenue Bonds which matures in 2011. The proceeds
were used to purchase the previously issued special assessment bonds. Financing is to be provided
by property tax increments generated within the specific geographic region described by the bond
assessment district.
Redevelopment Agency Fund — Established to account for the principal payments, interest
payments, and related costs of the 1999 Project Tax Allocation Bonds, 2002 Tax Allocation
Refunding Bonds, and 2009 Tax Allocation Refunding Bonds.
CAPITAL PROJECTS FUNDS
Capital Improvement Fund — Established for the costs associated with major capital improvement
projects not tied to specific funds elsewhere. Improvements could include medians, parkways,
sidewalks, and other public assets.
Bedroom Tax Fund — Established to collect funds from multiple -unit housing used to pay for
maintaining and developing parks within local neighborhoods.
Assessment Districts Fund — Established to account for ongoing construction and improvement
needs within the following assessment districts: Peacock Gap, Kerner Boulevard, Sun Valleyitucas
Valley Open Space, East San Rafael Drainage Assessment District 1,
Park Capital Projects Fund — Established to account for capital improvements for all City owned
parks, whether paid for by City funds, grants, donations, or partnership with the community.
Open Space Fund — Established for the acquisition of open space,
M
NON -MAJOR GOVERNMENTAL FUNDS
Equipment Replacement Fund - Established to provide replacement of equipment.
Radio Replacement Fund - Established to meet radio system operating costs, capital acquisition and
replacement, and operating lease obligations for the Public Works, Fire, Community Development
and Police Departments. The Marin Emergency Radio Authority (MERA) is a countywide JPA that
has taken the roll in procurement and installation of a new digital radio system. This fund supports
San Rafael's portion of the MERA efforts and related contractual obligations.
Telephone Replacement Fund — Established to provide ongoing support services for telephone
equipment and usage throughout the City.
a
ASSETS
Cash and investments
Restricted cash and investments
Receivables:
Accounts
Taxes
Grants
Interest
Due from other funds
Total Assets
CITY OF SAN RAFAEL
NONMAJOR GOVERNMENTAL FUNDS
COMBINING BALANCE SHEET
JUNE 30, 2011
SPECIAL REVENUE FUNDS
Baypoint
Lagoons Household
Recreation Assessment Ha7jnat
Revolving District Facility _
$317469 $1517264 $183,188
Street
Maintenance
Childcare and Cleaning
$611,998
173,978 91229 $24,653 15,645
507
L462 39,539
29,304
$522,213 $151,771 $274,417 $64,192 $627,643
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable
5124,978
$141,890
$33,271
Developer bonds payable
Due to other funds
29,304
Deferred revenue
198,841
Compensated absences
Total Liabilities
323,819
141,890
62,575
Fund Balances:
Nonspendable
Restricted
148,038
5151,771 132,521
1,617
$545,248
Committed
50;356
82,395
Assiuned
Total Fund Balances
198,394
151,771 132,527
1,617
E27,643
Total Liabilities and Fund Balances
$522213
$151.771 $274,417
$64,192
$627,643
M
SPECIAL REVENUE FUNDS
Loch Lomond
1 L749
Assessment
693
Library
Public
147,359
Development
District
Library
Assessment
Safety
Stormwater
Services
Grants
$899,919
$101,083
$464,683
$184,424
$639,814
$743,501
$149,251
9011,224 153,082
466,418
201,731
18,000
743,543
20,000
$900,224 $165,831
305
$202,424
16,789
$763,501
15,818
64,748
(Continued)
619,008
445,340
$900,224
$165,831
$480,872
5242,424
$1,106,972
$763,501
$768259
$12,497 $14,454 $693 $14,430 $18„458 $147,359
L500
252
1 L749
14,454
693
14.430
19,958
147,359
$9010,224 128,867
201,731
1,086,542
620,900
24,215
466,418
743,543
9011,224 153,082
466,418
201,731
1,086,542
743,543
620,9017
$900,224 $165,831
$480,872
$202,424
$1,1610,972
$763,501
$768,259
(Continued)
83
CITY OF SAN RAFAEL
NONMAJOR GOVERNMENTAL FUNDS
COMBINING BALANCE SHEET
JUNE 30.2011
ASSETS
Cash and investments 51,126,472 5161,339 $3,930 $2,875
Restricted cash and investments
Receivables:
Accounts $572,525
`Faxes 73,221
Grants 18,963
Interest
Due from other funds
Total Assets $1,145,435 5174.560 51930 $572,525 $2,875
LI,ABILITIES AND FL -ND BALANCES
DEBT
SERVICE
SPECIAL REVENUE FUNDS
FUNDS
Emergency
Peacock Gap
Parkland Medical Business Sewer
Assessment
Dedication Services Improvement Maintenance
District
ASSETS
Cash and investments 51,126,472 5161,339 $3,930 $2,875
Restricted cash and investments
Receivables:
Accounts $572,525
`Faxes 73,221
Grants 18,963
Interest
Due from other funds
Total Assets $1,145,435 5174.560 51930 $572,525 $2,875
LI,ABILITIES AND FL -ND BALANCES
Liabilities:
Accounts payable
$90,802
$28,618
$214
$93,812
Developer bonds payable
Due to other funds
445,340
Deferred revenue
Compensated absences
Total Liabilities
90,8172
28,018
214
5339,152
Fund Balances:
Nonspendable
Restricted
146,542
$2,875
Committed
1,054,633
3,716
.Assigned
33,373
Total Fund Balances
1,054,633
146,542
3,716
33,373 2.875
Total Liabilities and Fund Balances
$1,145,435
$174,560
$3,939
$572,525 $2,875
84
DEBT ShRVICE FU`\DS
199,
Redevelopment
Mariposa Financing
Agency
Assessment Authority
Debt Capital
District Revenue Bonds
Service Improvement
$16,469 $145,186
$34,213 5111,942
10.590
144,386
28
CAPITAL PROJECT FUNDS
Park
Bedroom Assessment Capital
Tax Districts Projects
$26,564 , $264,658 $29,4-73
$16,469 $145,186 $44,831 $256,328 $26,564 S264,658 $29,473
$16,035 $10,827
131,018
147,053 10,827
$16,469 $145,186 $44,831 99,440
9,835 $26,564 253,831
$29,473
16,469 145,186 44,831 109, 275 26,564 253,831 29,473
$16,469 $145,186 $44,831 $256,328 $26,564 $264,658 _$29,4-13
(Continued)
85
CITY OF SAN RAFAEL
NONMAJOR GOVERNMENTAL FUNDS
COMBINING BALANCE SHEET
JUNE 30, 2011
M
CAPTIAL PROJECT FUNDS
Total
Non -Major
Open
Equipment "
Radio
Telephone
Governmental
Space
Replacement
Replacement
Replacement
Funds
ASSET'S
Cash and investments
$137,975
$3,091,312
$525,509
$149,881
$10,213,792
Restricted cash and investments
10,590
Receivables:
Accounts
1 480
926,510
Taxes
106,640
Grants
888,106
Interest
28
Due from other funds
474,644
Total Assets
$137,975
$3,101,792
$525,509
$149,881
$12,620,310
LIABELITIES AND FUND BALANCES
Liabilities?
Accounts payable
$1IOX8
$22,347
$880,463
Developer bonds payable
1,500
Due to other funds
474,644
Deferred revenue
329,859
Compensated absences
252
Total Liabilities
110,378
22,347
1,686,718
Fund Balances:
N onspendable
Restricted
4,372,808
Committed
1,715,506
Assined
$137,975
2,991,414
$525,509
127,534
3,845,278
Total Fund Balances
137,975
2,991,414
525,509
121,534
10,933,592
Total Liabilities and Fund Balances
$137,975
$3,101,792
$525.509
$149,881
$12,62031 0
M
This Page Left Intentionally Blank
CITY OF SAN RAFAEL
CO141BINING STATEMENT OF RFVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE
NONMAJOR GOVERNMENTAL FUNDS
FOR THE YEAR ENDED JUNE 30, 2011
SPECIAL REVENUE FUNDS
Baypoint
Lagoons Household Street
Recreation Assessment Flazinat Maintenance
Revolving District Facility Childcare and Cleaning
REVENUES
Taxes and special assessments
$25,368
Use of money and properties
$L382
737
$518
$88
$4,458
Intergovernmental
20,060
5,156
265,429
15,645
Charges for services
2,243,443
1,234,157
3,003,866
Other revenue
55,404
2.6010
3.010
590
Total Revenues
2320,229
26,105
1,242,431
3,272,393
20,693
EXPENDITURES
Current:
General government
Public safety
(,241,239
Public works and parks
4,345
41,655
Culture and recreation
3,565,431
3,4923088
Capital outlay
Capital improvement/special projects
57,488
Debt service:
Principal
Interest and fiscal charges
Total Expenditures
3,622,919
4345
1,241,239
3,492,088
41,655
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES
(1,302,690)
21,760
1,192
(219,695)
(20,962)
OTHER FINANCING SOURCES {USES)
Transfers in
1,277,200
203,200
Transfers out
(520,000}
Total Other Financing Sources (,Uses]
1,277,200
203,200
(52((,000)
Net Change in Fund Balances
(25,490;
21,760
1,192
(16,495)
(5407962)
Fund Balance, Be>inning
223,884
130,011
131,335
18,1 i 2
1,168,605
Fund Balance, Ending
$198,39=1
S151,771
$132.527
$1.617
$627,643
M
SPECIAL REVENUE FUNDS
Loch Lomond
Assessment Library Public Development
District Library Assessment Safety Stormwater Services Grants
$15,228 $895,664
4,700 $36,316 1,335
$985
$5,202 $31;168
$1,253
316,683
69,993
1,792,668
4,686
5,601
795,448 26,810
3.223
107,650
226,288
5,300
19,928 360,908 896,999
87,229
800,650 284,266
1,799,221
143,739 100,600
53 967,127
79,500 430581 289,189
325,496 53,483
244,556 15,756 237,338 1,419,200
53 324.056 430,581 159,495 1,292,623 237,338 1,861,872
19,875 36,852 466,418 (72,266) (491,973) 46,928 (62,651)
65.000 600.000 53,370
(7,476)
65,000 600,000 45,894
19,875 36,852 466,418 ',266) 108,027 46,928 (16,757)
880,349 116,230 208.997 978,515 696,615 637,657
$900,224 $153,082 $466,418 $20L731 $1,086,542 $743,543 $620,900
(Continued)
89
CITY OF SAN RAFAEL
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE
NONMAJOR GOVERNMENTAL FUNDS
FOR THF YEAR ENDED JUNE 30, 2011
DEBT
SERVICE
SPECIAL REVENUE FUNDS FUNDS
Emergency Peacock Gap
Parkland Medical Business Sewer Assessment
Dedication Services Improvement Maintenance District
REVENUES
Taxes and special assessments
$483
$3,661,064
Use of money and properties
6,211
126
$39
Intergovernmental
18,963
13,000
Charges for services
1,661,227
$2,181,462
Other revenue
15,250
Total Revenues
25,65"
5,322,417
28,289
2,181,462
EXPENDITURES
Current:
General government
3,105
29,727
Public safety
5,383,677
Public works and parks
1,983,163
Culture and recreation
Capital outlay
189,834
Capital improvement/special projects
Debt service:
Principal
Interest and fiscal charges
Total Expenditures
189,834
5,386,782
29,727
1,983,163
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES
(164,177)
(64,365)
(1,438)
198,299
OTHER FINANCING SOURCES (USES)
Transfers in
Transfers out
(190,000)
(207,003)
Total Other Financing Sources (Uses)
(140,000)
(207,000)
Net Change in Fund Balmnces
(164,177)
(254,365)
(1,438)
(8,70I)
Fund Balance, Beginning
i.218,81C
400.907
5,154
42,074 $2,875
Fund Balance_ Ending
$1,054,633
$146,542
$3,716
$33373 $2,875
M
DEBT SERVICE FL NIDS
CAPITAL PROJECT FUNDS
9,915
1997
Redevelopment
klariposa Financing
Agency
Park
Assessment Authority
Debt
Capital
Bedroom Assessment
Capital
District Revenue Bonds
Service
Improvement
Tax Districts -
Projects
3,563fi63
$3,563,663
9,915
$3,570
$87 $768
123
123
88 $116
$151
30090
7,020
$1,000
(1,7%)
141,379)
213,313
(11,750)
(141,379)
68,094
6,869
87 1168
3563,786
214,313
3,658 68,210
7,020
ff
264,96-5)
9,915
38,120
73,437
2,225,000
1,338,663
3,563fi63
338,402
9,915
38,120
87
768
123
(124.089)
(6257)
30090
7,020
(1,7%)
141,379)
(11,750)
(141,379)
8 7
t982)
123
(265,468)
(6,251)
30,090
7,020
16,382
146,168
44,708
374,743
32,821
--$223,741
22,453
$16,469
$145,186
$44,831
$109,275
$26,564
$253,831
$29.473
(Continued)
ff
CITY OF SAN RAFAFL
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE
NONMAJOR GOVERNMENTAL FUNDS
FOR THE YEAR ENDED JUNE 30, 2011
REVENUES
Taxes and special assessments
Use of money and properties
Intergovernmental
Charges for services
Other revenue
Total Revenues
EXPENDITURES
Current'
General government
Public safety
Public works and parks
Culture and recreation
Capital outlay
Capital improvement/special projects
Debt service:
Principal
Interest and fiscal charges
Total Expenditures
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES
OTHER FINANCING SOURCES (t?SES)
Transfers in
Transfers out
Total Other Financing Sources (Uses),
Net Change in Fund Balances
Fund Balance, Beenining
Fund Balance, Ending
CAPITAL PROJECT FUNDS
Total
Non -Major
Open Equipment Radio Telephone Governmental
Space Replacement Replacement Replacement Funds
3,763 458,533 568,555
3,763 458,533 568,555
32,832
6,868,655
2,996,343
7,856,789
881,813
270,010 3,348,636
66,232 2,291,232
5,091 1,343,754
341,333 25,620,054
(3,034) 690,075 81,485 37,136 (895,489)
'x,198,770
(1,06",605)
1,131,165
(3,634) 690,075 81,485 37,136 235,676
141,009 2301,339 444.024 90.398 10,697,916
$137,975 52,991.414 $525,509 $1271,534 $10,933,592
$8,165,040
$729 $14,699 $1,380
$469 113,128
2,518,537
1,092,535 648,660
378,000 13,489,208
41,374
438,652
724 1,148,608 630,040
378,469 24,724,565
3,763 458,533 568,555
3,763 458,533 568,555
32,832
6,868,655
2,996,343
7,856,789
881,813
270,010 3,348,636
66,232 2,291,232
5,091 1,343,754
341,333 25,620,054
(3,034) 690,075 81,485 37,136 (895,489)
'x,198,770
(1,06",605)
1,131,165
(3,634) 690,075 81,485 37,136 235,676
141,009 2301,339 444.024 90.398 10,697,916
$137,975 52,991.414 $525,509 $1271,534 $10,933,592
This Page Left Intentionally Blank
CITY OF SAN RAFAEL
BUDGETED NONMAJOR GOVERNMENTAL, FUNDS
COMBINING SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES I-NFUND BALANCES
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2011
REVENUES
Taxes and special assessments
Licenses and permits
Fines and forfeitures
Use of money and properties
Intergovernmental
Charges for services
Other revenue
Total Revenues
EXPENDITURES
Current;
General government
Public safety
Public works and parks
Culture and recreation
Capital outlay
Capital improvementispecial projects
Debt service:
Principal
Interest and fiscal charges
Total Expenditures
EXCESS (DEFICIENCY) OF PFVFNUES
OVER (UNDER) EXPFNDFFURFS
OTHER FINANCING SOURCES (USES)
Transfers in
Transfers out
Total Other Financing Sources (Uses',
FUND BALANCES, BEGINNING OF YEAR
AND OTHER SOURCES AND USES OVER
k �UNDFR` EXPENDITURES
, I
FUND BALANCE -S, BFCTINNING OFYFAR
FUND BALANCES, END OF YEAR
SPECIAL REVENUE FUNDS
Recreation Revolving Baypoint Lagoons Assessment District
Variance Variance
Final positive Final Positive
Budget Actual (Negative) Budget Actual (Negative)
3,346,741 3,565,431
(218,690)
$25,000 $25,368 $368
$954
$1,382
$428 2,254 737 0;517)
20,000
20,000
2,374,630
2,243,443
(131,187)
29,850
55,404
25,554
2,425,434
2,320229
(105,205) 27,254 26,105 (1J49)
3,346,741 3,565,431
(218,690)
2,480
2,480
25,000 57,488
(32.488)
3.374,221 3.622,919
(248,698)
4,345 (4,345)
4,345 (4,345;
(948,7871) 1,302,690) (351903) 27,254 21,760 (5,494)
1,277100 1,27171,200
1,277200 1,277200
$328,413 (25,490') ($351903) $27,254
223,884
$198,394
M
21,760 ($5J94)
130,611
$151,771
SPECIAL REVENUE FUNDS
Household Hamat Facility Childcare Street Maintenance and Cleaning
Variance Variance Variance
Final Positive Final Positive Final Positive
Budget Actual (Negative) Budget AetuaI (Negative) Budget Actual (Negative)
$1,075
5518
($557)
$224
$88
($236)
$12,831 $4,458
($8,373)
7,330
5,156
(2,174)
274,200
265,429
(8,771)
15,645
15,645
1,473,280
1,234,157
(239,123}
3,239,450
3,003,866
(235,584)
3010
2,606
2,300
3,010
3,010
2,580 590
(1,990)
1,481,985
1,242,431
(239,554}
3.513,874
3.272,393
(241,481)
15,411 20,693
5,282
1,419,220 1,241,239 177,981
3,667,585 3492,088 175,497
11,890 11,896
3,200 3;200
132 41,655 (41,523)
1,422,420 1,241,239 181,181 3,679,475 3J92,088 187,387 132 41,655 (413523)
59,565 1,192 (58,373) (165,601) (219,695) (54,094) 15,279 (20,962) (36,241)
202,700 203,200 500
(45,500) 45,500 (520,060) (520,000)
157,260 203,200 46,060 (520,660) (520,000)
$597165 1,192 $58,373; ($8,401) (16.495) ($8,094) (W4,721} (540,6962) ($36,241)
131,335 18,1 12 1.1613,605
$132,527 $1,61 7 $627,643
Continued)
95
CITY OF SAN RAFAEL
BUDGETED NONlvLAJOR GOVERNMENTAL FUNDS
COMBINING SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2011
REVENUES
Taxes and special assessments
Licenses and permits
Fines and forfeitures
Use of money and properties
Intergovernmental
Charges for services
Other revenue
Total Revenues
EXPENDITURES
Current:
General government
Public safety
Public works and parks
Culture and recreation
Capital outlay
Capital improvement/special projects
Debt service
Principle
Interest and fiscal charges
Total Expenditures
EXCESS( ' (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES
0'11-IER FINANCING SOURCES (USES)
Transfers in
Transfers out
Total Other Financing Sources tUses,
EXCESS (DEFICIENCY) OF REVENUES
AND OTHER SOURCES AND USES 0VF'.R
("UNDER) EXPENDITURES
FUND BALANCES, BEGIN-NING OF YEAR
FUND BALANCES, END OF YEAR
SPECIAL REVENUE FUNDS
Loch Lomond Assessment District Library
Variance Variance
Final Positive Final Positive
Budget Actual (Negative) Budget Actual (Negative)
$15,200 $15,228 $28
16,788 4700 (12,088) $42,008 $36,316 ($5,692)
291,530 316,683 25,153
4,000 4,686 686
3,F000 3,223 (30,777)
31,988 19,928 (12,060) 371,539 360,908 (10,630
50 53 (3)
157,803 719,500 78,303
205.835 244,556 (38,721)
50 53 (3) 363,638 324,056 39,582
31,938 19,875 (12,063) 7,900 36,852 28,952
$31,938 19,875 ($12,063) $7,900 36,852 $28.952
830.349
5900,224
w
116230
$153,082
SPECIAL REVENUE FUNDS
Library Assessment Public Safe v Stormevater
Variance Variance Variance
Final Positive Final Positive Final Positive
Budget Actual (Negative) Budget Actual (Negative) Budget Actual (Negative)
$875,500 $895,664 $20,164
1,335 1,335 $3,458
$985
(52,473) 17,063 $5,202 (11,861)
65,350
69,993
4,6433
3,000
5,601
2,601 793,000 795,448 2,448
500
10,650
10,150
875,500 896,999 21,499 72,308
8i`,229
14,921 817,323 800,650 (16,673)
458,651 430,581 28-070
152,453 143,739 8,714
1,000 15,756 (14,756)
1,159,503 967,127 183,376
.324,744 325,496 (756)
458,651 430,58I 28,070 153,453
159,495
(6,1342) 1,475,243
1,291623 182,620
1
416,849 466,418 49,569 (81,145)
(72,266)
8,879 657,920)
(491,973) 165,947
65,G0i)
65,030
600,000
600,000
65.(1913
65,009
600,006
600,000
$416,849 466,418 $49,569 ($16,145) (7,266, $8,879 {$57.920; 108,027 $165,947
2138,997 978,515
$466,418 $2111,731 $1,686,542
(Continued)
CITY OF SAN RAFAEL
BUDGETED NONMAJOR GOVERNMENTAL FUNDS
COMBINING SCHEDULE OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES
BUDGET AND, ACTUAL
FOR THE YEAR ENDED JUNE 30, 2011
REVENUES
Taxes and special assessments
Licenses and permits
Fines and forfeitures
Use of money and properties
Intergovernmental
Charges for services
Other revenue
Total Revenues
EXPENDITURES
Current:
General government
Public- safety
Public works and parks
Culture and recreation
Capital outlay
Capital improvement/special projects
Debt service:
Principle
Interest and fiscal charges
Total Expenditures
EXCESS (DEFICIENCY) OF REVENUES
OVER (UNDER) EXPENDITURES
OTIIER FINANCING SOURCES (USES)
I"ransfers in
Transfers out
Total Other Financing Sources (Uses)
EXCESS (DEFICIENCY) OF REVENUES
AND OTHER SOURCES AND USES OVER
(UNDER) EXPENDI'T'URES
FUND BALANCES, BFCTINNING OF YEAR
FUND BAi,ANCES, END OF YEAR
SPECIAL REVENUE FUNDS
Development Services Grants
Variance Variance
Final Positive Final Positive
Budget Actual (Negative) Budget Actual (Negative)
$37,071 $31,168
($5,4031
$8,454
$1,253
($7,201)
33,524
945,025
1,742,668
847,641-
47,64226,810
26,810
26,8110
226,288
226,288
67,000
5,300
(61,700)
37,671 284,266
247,195
1,020,480
1,799,221
778,741
100,000 100,000
334,496 289,189 45,307
52,500 53,483 (983)
237,338 (237,338) 541,988 1,419,200 (827,212)
237,338 (237,338) L078,984 1,861,872 (782,888)
37,0'1 46,928 $9,857 (58;51)4) (112,(151} (41147)
51,816
53,370
1,554
(41,G00)
(7,476)
33,524
10.816
45.894
35.078
$37,071 46,928 $9,857 ($47,6881 06,75711 $30,931
690;.615 637,657-
$74' 543 $743,543
M
103,077 189,834 {86,757) 5,695,163 5,38h782 218,381 39,580 295727 9,853
23,920 1164,177) (188,097) 186,936 (64365) (251,301) (486) {1,4381 (952)
(190,000) (190,000)
(190,000) (190-000
$23,920 (164,177) $188,097) ($3,0641 1254,365) ($251,301) (,$486} (1,438; ($952)
1,218,817 400,907 5,154
SI.05033 $146,542 $3,716 (Continued)
ME
SPECLAi REVENUE FUNDS
Parkland Dedication
Emergency
Medical Services
Business Improvement
Variance
Variance
Variance
Final
Positive
Final
Positive
Final
Positive
Budget
Actual
(Negative)
Budget
Actual
(Negative)
Budget
Actual
(Negative)
$483
$483
5305,000
$3,661,064
($23,936)
$23,920
6,211
(17;709)
7,099
126
(6,973)
$64
$39
($25)
103,077
18,963
(84,114)
16,510
13,000
(3,510)
2,100,+000
1,661,227
(438,773)
22,520
15,250
(7,270)
126,997
25,657
(101,340)
5,792,099
5322,417
(469,682)
39,094
28,289
(IOM5)
3,105
(3,105)
39,580
29,727
9,853
5,599,163
5,383,677
215,486
$103,077
189;834
(86,757)
6,000
6,000
103,077 189,834 {86,757) 5,695,163 5,38h782 218,381 39,580 295727 9,853
23,920 1164,177) (188,097) 186,936 (64365) (251,301) (486) {1,4381 (952)
(190,000) (190,000)
(190,000) (190-000
$23,920 (164,177) $188,097) ($3,0641 1254,365) ($251,301) (,$486} (1,438; ($952)
1,218,817 400,907 5,154
SI.05033 $146,542 $3,716 (Continued)
ME
CITY 0PSAN RAFaEL
BUDGETED N0wmAx)nGOVERNMENTAL FL -NDS
C0Mnnvm0SCHEDULE 0FREVENUES, EXPENDITURES,
AND CHANGES mFUND BALANCES
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE m.zo/|
SPECIAL REVENUE FUNDS
DEBT SERVICE FUND
u Maintenance
Mariposa Assessment District
Variance
Variance
Final Positive
emu|
nm//i°,
Budget Actual
Budget Actual
ncvsmocs
Taxes and special assessments
uvou,es and permits
Fines and forfeitures
Use ofmoney and properties
%313 $m
($226)
/otergu"onnm^nrm
Charges for services
S2394.434 Sx.|o/.w� (212.972)
Other revenue
Total Revenues
2,394,4342//1,46-1(212,972)
313 97_1226L
Ezpovo|TomES
cnoem:
General government
Public safety
Public works and parks
2.176.73* 1,983.163 |vs.sn
Culture and recreation
Capital outlay
Capital improvement/special projouts
Debt service:
p*o"pl*
Interest and fiscal charges
Total Expenditures
2,176�734_ l983,163L 193,57I_
EXCESS y/spCIEmcY0opREVENUES
OVER (uwnsn)szpsmmT!RES
217,700L198,299(19,4l1)
313L87l226l
nrI/cxFINANCING SOURCES (ooen)
r,^onfers/o
z*:nstersout
l2 1 �07,000L��00
Total omzf`nonnnineSources (o*es)
_-_(2.17,700)12077000L10,700
EXCESS (osrmswcv)nrxsyswoso
AND OTHER SOURCES AND USES OVER
(UNDER) EXPENDITURES
<u.ro�)
nr
FU -ND BALANCES, BEGINNING opWEAR
42,074
16�82_
FomoBALANCES, END orYEAR
230,845 768 (230,077) 3,563,940 3,563,786 (154' ),
123,000
DEBT SERVICE FUND
123,000
2,225,000
2,225 000
1997 Financing Authority Revenue Bonds
Redevelopment Agency Debt Service
Variance
1,338,940
Variance
Final
Positive
Final
Positive
_24,460
Actual (Negative)
Budget
Actual (Negative)
—Budget
3,563,940
$228,000
($228,000)
$1563;940
$3,561663 ($277)
2,845
$768 (2,077)
123 123
230,845 768 (230,077) 3,563,940 3,563,786 (154' ),
123,000
123,000
2,225,000
2,225 000
24,460
1,338,940
1,338,663
277
_24,460
147,460
3,563,940
3,561663
277
_147J60
83,385
768
($82,617}
123
5123
291,930
(292,930)
(1,750)
(1.750)
291,930
(1,750)
0,7510)
—
$81,635
(982'1
($82,61?)
123
$123
146,168
44,708
$145, i 86
$44,831
m
This Page Left Intentionally Blank
INTERNAL SERVICE FUNDS
Internal service funds account for department services and financing performed for other departments
within the same governmental jurisdiction. Funding comes from charges assessed to the departments
benefiting from the sei'% ice.
Building Maintenance Fund - Established to account for construction projects and cyclical large
dollar maintenance tasks (roof, painting) completed on City owned buildings.
Employee Benefits Fund - This fund is utilized for the payment of retiree benefits, unemployment
insurance, accumulated leave requirements and other negotiated benefits not tied to a specific
department.
Liability Insurance Fund - Established to maintain sufficient reserves for outstanding claims. All
costs associated with liability premiums are paid from this fund,
Workers' Compensation Fund - Established to maintain sufficient reserves for injury claims, All
costs associated with workers compensation, including safety training, wellness programs, claim
expenses and insurance premiums are paid from this fund.
Dental Insurance Fund - Set up to maintain sufficient reserves for dental claims. All costs
associated with dental claims and administrations are paid from this fund.
Employee Retirement Fund — Set up to account for the principal payments, interest payments, and
related cost of the 2010 Taxable Pension Obligation Bonds.
ASSETS
Current Assets:
Cash and investments
Restricted cash and investments
Accounts receivable
Due from other funds
Total Assets
LIABILITIES
Current Liabilities:
Accounts payable
Due to other funds
Non-current Liabilities:
Long term debt
Total Liabilities
NET ASSETS:
Unrestricted
'Total veL Assets
CITY OF SAN RAFAEL
INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF NET ASSETS
JUNE 30, 2011
Building Employee
Maintenance Benefits
Liability Workers'
Insurance Compensation
$354,019 91765,322 $596,687
$1,065,594
803,158
354,019 1,065,594 1,568,480 596,687
8,195 242,614 7,744 12,082
803,158
8,195 1,045,772 7,744 12.082
345,824 19,822 1,560,736 584,605
$345,824 $19,822 51,560,736 $584,605
104
Dental Employee
Insurance Retirement Total
$113,010 $2,768,032 $4,597,070
229,170 229,170
1,065,594
803,158
113,010 2,997,202 6,694,992
71 270,706
803,158
4,490,000 4,490,000
71 4,490.000 5,563,864
112,939 (1,492,798) 1,131,128
$112,939 ($1,492,798) $1,131,128
105
CITY OF SAN RAFAEL
INTERNAL SERVICE FUNDS
COMBENING STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET ASSETS
FOR THE YEAR ENDED JUNE 30, 2011
106
Building
Employee
Liability
Workers'
Maintenance
Benefits
Insurance
Compensation
OPERATING REVENUES
Charges for current services
$110,690
$1,292,154
$1,569,880
$1,941,176
Other operating revenues
1,839,980
154,687
Total Operating Revenues
110,690
3,132,134
1,724,567
1,941,176
OPERATING EXPENSES
Insurance premiums and claims
2,790,908
996,515
1,855,109
Maintenance and repairs
110,635
General and administrative
744,613
OPER expense
Total Operating Expenses
110,635
3,535,521
996,515
1,855,109
Operating Income (Loss)
55
(403,387)
728,052
86,067
NONOPERATING REVENUES (EXPENSES}
Investment income
2,210
5,657
3,477
Interest expense
Total Nonoperating
Revenues (Expenses)
2,210
5,657
3,477
Net income (loss) before transfers
2,265
(403,387)
733,709
_89,544
Transfers in
140,000
218,032
Transfers on,,
(73,200)
Change in Net Assets
69,065
(185355)
733,709
89_544
NIETASSETS, BEGINNING OF YEAR
276,759
205,177
827,027
495,061
NET ASSETS, END OF YEAR
$34-5,824
$19,822
S1 560) 736
$584,605
106
Dental Employee
Insurance Retirement Total
$499,534 $3,992,223 $9,405,657
8,313 2,402,980
507,847 3,992,223 11,408,637
458,959 6,101,491
110,635
744,613
4,009,971 4,009,971
458,959 4,009,971 10,966,710
48,888 (17, 448) 441,927
601 7,202 19,147
(511,512) (511,512)
601 (,504,310) (492,365)
49,489 (522,058) (50,438)
358,032
(970,740) (1,043,940)
49,489 (1,492,798) (736,346)
63,450 1,867,474
$112,939 ($1,492,798) $1,131,128
I=
CITY OF SAN RAFAEL
INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED JUNE 34, 2011
CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from customers/other funds
Cash payments to suppliers for goods and services
Other operating revenues
Cash Flows from Operating Activities
CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES
Proceeds from issuance of long term debt
Interfund receipts (payments)
Interest expense
Cash Flows from Noncapital
Financing Activities
CASH FLOWS FROM INVESTING ACTIviTiEs
Investment received
Cash Flows from Investing Activities
,Net increase (decrease) in cash and cash equivalents
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR
CASH AND CASH EQUIVALENTS, END OF YEAR
Reconciliation of operating income (loss) to net cash
provided by operating activities:
Operating income (loss)
Net change in assets and liabilities:
Accounts receivable
Prepaids and deposits
Accounts payable
Net Cash Provided by (Used in) Operating Activities
108
Building
Employee
Liability
Workers'
Maintenance
Benefits
---Insurance
Compensation
$110,690
$1,280,243
$1,569,884
$1,941,176
(102,440)
(3,295,729)
(988,834)
(1,738,2161
765,322
1,839,980
154,697
8,250
(175,506)
735,733
202,960
66,800
175,506 23,932
18,594
66,800
175,506 23,932
18,594
2,210
5,657
3,477
2,210
5,657
3A77
77,260
765,322
225,031
276,759
371,656
$354.019
$765,322
$596,687
$55 ($403,387) S728,052 $86,067
(11,911)
125,241
8,195 239,792 7,681 (8,348)
58,250 ($175,506) $735.733 $202,960
Dental Employee
Insurance Retirement Total
$499,534 $3,992.223 $9,393,746
(462,704) (4,009.97 1 1) (10,597,894)
8,313 2,002.980
45,143 -(1-7,748) 798,832
4,260,830 4,260,930
(970,740) (685,908)
(511 ,512) (511,512)
2.778,578 3,063,410
601 7,202 19,147
601 7,202 19,147_
45,744 2,768.032 3,881,389
67,266 715,681
$113,010 $2,768,032 $4,597,070
$48,888 ($17,748) $441,927
(11,911)
125.241
(3,745) 243,575
$798,832
$45.143 {$27,748)
M
This Page Left Intentionally Blank
STATISTICAL
STATISTICAL SECTION
This part of the City's Comprehensive Annual Financial Report presents detailed information as a context for
understanding what the information in the financial statements, note disclosures, and required supplementary
information says about the City's overall financial health. In contrast to the financial section, the statistical section
information is not subject to independent audit.
Financial Trends
These schedules contain trend information to help the reader understand how the City's financial performance and
well being have changed over time:
1, Net Assets by Component
2. Changes in Net Assets
3. Fund Balances of Governmental Funds
4. Changes in Fund Balance of Governmental Funds
Revenue Capacity
These schedules contain information to help the reader assess the City's most significant local revenue source, the
property, tax:
I. Assessed and Estimated Actual Value of Taxable Property
1 Property Tax Rates, All Overlapping Governments
3. , Principal Property Taxpayers
4, Property Tax Levies and Collections
Debt Capacity
These schedules present information to help the reader assess the affordability of the City's current levels of
outstanding debt and the City's ability to issue additional debt in the future:
1. Ratio of Outstanding Debt by Type
1 Computation of Direct and Overlapping Debt
3, Computation of Legal Bonded Debt Margin
4. Revenue Bond Coverage Parking Facility
5. Redevelopment Pledged Revenue Coverage
Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader understand the environment within
which the City's financial activities take place:
1. Demographic and Economic Statistics
2. Principal Employers
Operating Information
These schedules contain service and infrastructure data to help the reader understand how the information in the
City's financial report relates to the services the City provides and the activities it performs:
1. Full -Time Equivalent City Government Employees by Function
2, Operating Indicators by FunctiowProgram
3, Capital Asset Statistics by FunctionTrograin
Sources
Unless otherwise noted, the information in these schedules is derived from the Comprehensive Annual Financial
Reports for the relevant year. The City implemented GASB Statement 34 in 2003; schedules presenting
governmentwide information include information beginning in that year.
T
h $240,000
0
U
S $190,000
a
n $140,000
d
$90,000
($10000)
2003 2004 2005 2006 2007 2008 2009 2010 2011
CITY OF SAN RAFAEL
NET ASSETS BY COMPONENT
Last Nine Fiscal Years
(accrual basis of accounting)
Governmental activities
Invested in capital assets,
net of related debt
Restricted
Unrestricted
Total governmental activities net assets
Business-hpe activities
Invested in capital assets,
net of related debt
Unrestricted
Total business -type activities net assets
Primary government
Invested in capital assets,
net of related debt
Restricted
Unrestricted
Total primary government net assets
ONet ofRelated Debt MRestricted MUnrestricted
2003
As of June 30
2004
$198,031,181
$202,215,793
$194,658,126
2,933,294
2,708,397
2,378.,641
16,216,230
9,775,565
14,167,627
$217,180,705
$214,699,755
$211,204,394
$8,464,417 $8,7497750 $8,615,483
1,078,245 1,447,467 1,900,504
$9,542,662 $10,197,217 $10,515,987
$206,495,598
$210,965,543
$203,273,609
2,933,2294
2,708,397
2,378,641
17,294,475
11,223,032
16,068,131
$226,723,367
$224,896,972
$221,720,381
w
2006
2007
2008
As of June 30
2009
2010
2011
$175,806,100
$171,849,149
$176,724,820
$178,744,119
$173,536,144
$174,281,922
620,889
31,124,935
26,848,900
25,721,231
26,150,254
21,322,937
32,739,318
4,499,136
4,273,937
(700,985)
(4,631,276)
(8,170,324)
$209,166,307
$207,473,220
$207,847,657
$203,764,365
$195,055,122
$187,434,535
$9,819,435
$9,717,501
$10,130,329
$11,243,637
$10,950,825
$10,793,592
I113,659
2,226,838
2,471,117
1,936,958
2,017,354
1,948,447
$11,933,094
$11,944,339
$12,601,446
$13,180,595
$12,968,179
$12,742,039
$185,625,535
$181,566,650
$186,855,149
$189,987,756
$184,486,969
$185,075,514
620,889
31,124,935
26,848,900
25,721,231
26,150,254
21,322,937
34,852,977
6325,974
61745,054
1,235,973
(2,613,922)
(6,221,877)
$221,099,401
$219,417,559
$220,449,103
$216,944,960
$208,023,301
$200,176,574
113
CITY OF SAN RAFAEL
CHANGES IN NET ASSETS
Last Nine Fiscal Years
(Accrual Basis of Accounting)
Business-'I'ype Activities:
Parking services
1,245,316
1,539,441
Fiscal Year Ended June 30,
2,761,511
2003
2004
2005
2006
Expenses
Total Primary Government Expenses
$81,381,239
$66,992,396
$73,263,656
Governmental Activities:
Component Unit:
General government
$5,555,915
$5,074,335
$5,895,390
$6,252,533
Public safety
30,476,353
301453,108
32,891,692
33,178,537
Public works and parks
27,237,899
16,043,092
16,820,453
23,401,246
Community development 1 redevelopment
3,727,315
3,921,422
4,624,345
4,194,249
Culture and recreation
9,055,681
7,444,339
8,450,017
8,652,4 45
Interest on long-term debt
4,082,760
2,516,659
2,129,818
1,725,559
Total Governmental Activities Expenses
80,135,923
65,452,955
70,811,715
77,404,569
Business-'I'ype Activities:
Parking services
1,245,316
1,539,441
2,451,941
2,761,511
Total Business -Type Activities Expenses
1,245,3I6
1,539,441
2,451,941
2,761,511
Total Primary Government Expenses
$81,381,239
$66,992,396
$73,263,656
$80,166,080
Component Unit:
San Rafael Sanitation District
$5,708,208
$5,297,737
$5,288.582
$6,148,915
Program Revenues
Governmental Activities:
Charges for services:
General government
$1,433,372
$1,487,595
$I,831,269
$402,094
Public safety
2,530,916
2,203,371
4,315,141
5,085,679
Public works and parks
3,072,849
2,697,858
3,298,076
3,799,861
Community development/redevelopment
1,691,427
1,982,211
1,9745527
1190,832
Culture and recreation
3,688,418
3,960,777
3,924,360
4,368,274
Operating grants and contributions
6,003,700
5,252,820
3,321,135
2,745,570
Capital grants and contributions
1,744,556
573,485
606,589
3,936,474
Total Government Activities Program Revenues
20,165,238
18.158,117
19,271,097
23,528,784
Business -Type Activities:
Charges for services:
Parking services
1,810,479
2,307,432
2,604,066
3,025,380
Total Business -Type Activities Program Revenues
1,810,479
2,307,432
2,604,066
3,025,380
Total Primary Government Program Revenues
$21,975,717
$20,465,549
$21,875,163
$26,554,164
Component Unit:
Charges for services:
San Rafael Sanitation D}striet
$5<566,610
$5,811,437
$6,060,993
$6,340.773
Net (Expense)/Revenue
Governmental Activities
($59,970,685)
($4794,838)
($51,540,618)
($53,875,785)
Business -Type Activities
565,163
767,991
152,125
263,869
Total Primary= Government Net Expense
(559,405,522)
($46.526,847)
($51,388,493)
($53,611,916)
Component UnitActivities
($141,598)
$513,700
$772,411
$191,858
W
2007 2008 2009 2010 2011
$8,908,433
$8,621,079
$8,075,344
$8,396,759
$8,269,846
37,271,272
40,845,347
42,708,538
42,752,033
44,735,486
20,998,749
22,105,367
23,036,676
17,401,923
17,408,038
4,384,408
5,811,866
5,759,171
6,738,873
7,804,650
9,729,485
10,300,230
11,505,896
11,139,225
11,487,999
2,183,683
1,989,620
1,907,229
2,200,024
1,621,605
83,476,030
89,673,509
92,992,854
88,628,837
91,327,624
3,110,254
3,282,235
3,561235
4,016,198
3,785,751
3,110,254
3,282,235
3,563,235
4,016,198
3,785,751
$86,586,284
$92955,744
$96,556,089
$92,645,035
$95,113,375
$6,656,432
$8,090,636
$9,143,977
$9,087,354
$9,677,630
$1,512,814
$1,494,784
$1,738,685
$1,665,460
$1,636,542
5,279,785
5,562,072
5,906,445
6,308,912
6,167,925
4,030,060
4,983,288
4,753,817
3,916,874
4,141,103
2,815,009
3,247,024
2,915,872
2,830,179
2,676,663
4,521,004
4,870,884
5,253,683
5,280,458
5,362,497
3,701,901
3,463,616
3,544,248
3,721,055
3,651,902
2,786,761
3,239,509
7,311,173
2,116,906
1,857,670
24,647,334
26,861,177
31,423,923
25,839,844
25,494,302
3,242,046
4,161,936
4,454,490
4,244,404
4,011,333
3,242,946
4,161,936
4,454,490
4,244,404
4,011,333
$27,889,380
$31,023,113
$35,878,413
$30,084,248
$29,505,635
$7,857,916
$9,366,305
$10,567,647
$11,559,549
$12,223,779
{$58,828,696}
($62,82,332)
($61,568,93Ij
($62,788,9931
($65,833,322)
131,792
879,701
891,255
228,206
225,582
($58696,904)
($61,932,631)
($60,677,676)
($62,560,787}
($65,607,740)
$1,201,484
$1;275.669
$1,423,670
$2,472,195
$2,546,149
115
CITY OF SAN RAFAEL
CHANGES IN NET ASSETS
(continued)
Last Nine Fiscal Years
(Accrual Basis of Accounting)
2003 2004 2005 2006
General Revenues and Other Changes in Net Assets
Governmental Activities:
Taxes:
Property
$13,983,697
$14,895388
$17,385,722
$20,848,887
Sales
16,779,878
17,166,966
17332,100
18,188,524
Special assessments
3,055,575
3,329,680
3,642,184
3,017,488
Paramedic
Motor vehicles
3,317,710
2,495,598
4,657,817
372,726
Transient occupancy
Franchises
Business licenses
Other
5,465,495
5,476,044
5,151.205
6,963,448
Investment earnings
1,897,339
809,242
1,112,548
11248,409
Gain (Loss) on disposal ol'assets
(500,819)
Miscellaneous
1,843,458
498,200
876,907
361,195
Special item - Court fines repayment
Transfers
232,398
142,970
15,720
201,191
Total Government Activities
46,074,731
44,813,888
49,974,203
51,201,868_
Business -Type Activities:
Investment earnings
17,772
29,534
28,522
44,536
Aid from other government agencies
40.735
L309,893
Transfers
(232,398)
(142,970)
(15.720)
(201,191)
Total Business -Type Activities
(214t626)
(113,436)
53,537
1,153,238
Total Primary Government ovemment
$45,860,105
S,14,700A52
$50,027,740
$52,355,106_
Component Univ
San Rafael Sanitation District
Property Taxes
$560,269
$591,078
$125,959
$179,479
Investment earnings
104,358
75,739
117,348
237,206
Miscellaneous
154,919
Aid from other governmental agencies
141,314
609,419
645,804
Total Component Unit
$805,941
$821,736
$852,726
$1,062,489
Change in Net Assets
Governmental Activities
($13,895,954)
($2,480,950)
($1,566,415)
($2,673,91717)
Business -Type Activities
350,537
654,555
205,662
1,417,107
Total Primary Government
(W,545,4177)
($1,826,395)
($1360,753)
($1,256,810)
Change in Net Assets
Component Unit Activities
$664,343
$1,335,436
$1.625,137
$1,254.347
2007 2008 2009 2010 2011
$20,360,475
22,195,606
$21,978,859
S21,684,131
$21,632,733
24,484,356
25,764,457
21,970,262
19,055,124
21,623,445
2,998,925
3,503,555
3,210,317
3,489,494
3,661,064
331,620
257,320
197,989
171,518
297,425
1,678,912
1,558,243
1,644,262
2,941,149
2,868,332
2,990,539
2,405,934
2,317,664
2,296,460
81830,955
9,242,241
1,561,835
1,411,583
1,930,531
1,669,181
1,583,056
717,968
302,180
176,502
221,791
491.488
296,454
461,224
541,390
1,496,174
(1,133,458)
212,170
344,080
361,190
458,300
463,600
58,245,712
63,186,769
57,485,639
54,079,750
58,212,735_
91,623
121,486
49,084
17,678
11,878
(212,170)
(344,080)
(361,190)
(458,300)
(463fi06)
(120,547)
(222,594)
....... L312,106
(440,622)
(451,722)
$58,125,165
$62,964,175
$57,173,533
$53,639,128
$57,761,013
$755,763
$803.071
$855,511
$823,187
$1,214,519
367,887
341,032
206,752
93,274
59,265
3,546
3,540
340.642
577,860
381,144
415,391
6,499
$1,464,292
$1,725,509
$1,446,947
$1,331,852
$1.280,283
($582,984)
$374,437
($4,083,292)
($8,709,243)
($7,620,587)
11,245
657,107
579,149
(212,416)
(226,140)
($571739)
$1,031,544_
($3,504,143)
($8,921,659]
($7,846,727)
$2,66-5,76S3,001,1'
18
$2,870,617
$3,804,047
$3,826,432
m
CITY SAN RAFAEL
FUND BALANCES OF GOVERNMENTAL FUNDS
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
Total Fund Balance
Wfutal Fund Balance
AsofJune 3l)
2002 2003 2004 2005 2006
General Fund
Pre -GASB 54 Presentation,
Reserved
$3,347,494
$2,357,904
$1,451,036
$2,442,881
$2,335,391
Unreserved
5,112,926
4,139,618
4,246,152
5,779,680
3,362,151
GASB 54 Presentation:
Nonspendable
Restricted
Committed
Assigned
Unassigned
Total General Fund
$8,460,420
$6497,522
$5,697,188
$8,222,561
_$5,697,542
All Other Governmental Funds
Pre -GASB 54 Presentation
Reserved
$22,579,186
S36t695,31 8
$32,471,197
$26,599,557
521,603,724
Unreserved, reported in:
Special Revenue Funds
13, 195,852
6,317,972
5,574,048
5,628,187
7,168,753
Capital Project Funds
Debt Service Funds
Expendable Trust Fund
422,188
GASB 54 Presentation
Nonspendable
Restricted
Committed
Assigned
Unassigned
Total all other govemmental funds
$36,197,226
141913,290
$38,045,245
$32,227,744
$28-772,477
(a) The change in total fiand balance for the General Fund and other
governmental funds
is explained in Management's Discussion and Analysis,
-As of June 30
2007 2008 2009 2010 2011
$905;0168 $2,196,153 $2,2225775 $1,763,622
5,1316,929 4,022,612 1,67 455 5,038,173
$589,833
200,238
555,561
5,439,874
$5,921,997 $6,218765 $3,896,230 $6,8001,795 $6,785,511 (a}
$20,773,760 $17,594,142 $16,680,568 $15,352,723
8,1137,477 7413,808 8,641,239 8,778,027
35,430 (1,037,293) 4,527,627
4,734,986 3,315 764 3,360,540
$377,18{}
19,289,367
3,864 322
4,124,029
$33,616,223 $28,364,144 $27,652,054 $28,658,377 $27.654,898 (a
CITY OF SAN RAFAEL
CHANGES IN FUND BALANCE OF GOVERNMENTAL FUNDS
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
Expenditures
Current:
General government
6188,702
4,740,703
Fiscal Year Ended June 30,
5,539,141
6,200,338
Public safety
2002
2003
2004
2005
2006
Revenues
9,329,346
9,491,552
9,257,991
9,294,419
10,622,585
Taxes and special assessments
$38,530,602
$39,284,643
$40,875,826
$42,901,520
$44,901,544
Licenses and permits
690,077
735,109
928,303
929,993
1,175,030
Fines and forfeitures
773,239
770,632
791,975
1,088,459
622,494
Use of money and properties
2,465,306
1,897,339
1,024,199
1,244,406
1,316,558
Intergovernmental
8,590,790
9,405,422
8,049,002
10,522,095
11,705,917
Charges for services
9,704,113
10,102,392
10,423,754
11,407,622
13,104,572
Other revenue
1,148,767
3,568,297
735,976
1,135,485
1,475,078
Total Revenues
61,902,894
65,763,834
62,829,035
69,229,580
74,301,193
Expenditures
Current:
General government
6188,702
4,740,703
5,014,452
5,539,141
6,200,338
Public safety
25,898,206
28,041,079
28,863,197
31,784,872
33,321,967
Public works and parks
9,329,346
9,491,552
9,257,991
9,294,419
10,622,585
Community development; redevelopment
3,610,108
3,253,947
3,875,542
3,763,614
4184,084
Culture and recreation
7,477,117
7,176,097
7,145,264
7,538,607
8,409,833
Capital outlay
307,483
125,884
31,703
1,027,267
60,411
Capital improvement% special projects
15360,086
11,058,796
9,825,103
9253,661
13,200,872
Debt service:
(6,432,801)
(42,971,248)
(4,979,898)
(7,740,3241
( 672,916)
Capitalized lease obligation
(682,757)
197,132
10,775
141,197
130,315
Principal
1,849,000
24 290,000
2,360,000
2,585,000
2,525,000
Interest and fiscal charges
2,641,111
4,046,170
2,456,357
2,1417,673
1,878,265
Total Expenditures
72,661,159
92,421,366
68,840,384
73,068,501
80,533,670
Excess (deficiency) of revenues over
(under)expendit es
(10,758.265)
(26,657,526)
(6,(}11,349)
(3,838,921)
(6,232,477)
Other Financing Sources (Uses)
Issuance of debt
32,625,000
Payment to refunded bonds
Bond premiums
Capital lease for equipment acquisition
Contribution from Sanitation District
744,556
Proceeds from sale of capital asset
Transfers in
5,750,044
42,503,976
5,222,868
8,636,544
6,925,10"7
I,ansfers(out)
(6,432,801)
(42,971,248)
(4,979,898)
(7,740,3241
( 672,916)
Total other financing sources (uses)
(682,757)
32,902,284
242,970
896 220
252,191
Nor Change it fund balances
($11,441,022)
$6,244,758
($5,768,379)
($2,942,701)
($5,980,286)
Debt service as a percentage of
noncapital expenditures
7.9°fn
35,1%
8.2%
7.8%
6.71
Fiscal Year Ended June 30,
200'7 2008 200 2010 2011
$52,472,246
$56,129,195
$51,019,143
$47,678,541
$51,448,130
1,157,981
1,489,748
1,472,913
1,518,819
1,416,772
515.528
797,481
560,338
787,411
862,820
1,744,688
1,584,508
847,120
433,874
380,720
12,760,496
12,081,968
17,518,670
13,(X)1,703
11,864,127
13,504,621
15,647,460
16,384,265
15,787,325
15,888,750
1,468,743
815,704
759,320
716,760
1,026,845
83,624,303
88,505,664
88,661.769
79,924,433
82,888,164
8,188,999
8,288,170
8,059,526
7,997,067
6,863,142
36;264,321
40,299,862
41,209,972
39,574,091
40,967,352
11,972,537
13,641,665
12,926,646
I0,731,669
10,666,176
4,319,042
5,786,661
5,572,079
4,398,594
4,527,351
9,005,370
9,820,365
10,233,361
9,605 684
10,067,822
6,716,630
6,243,517
5,048,044
1,890,559
1,745,483
1,189,613
5,124,091
6,606,857
3,436,608
6,2407861
2,287 255
2,504,370
2,714,358
2,804,258
2,530,338
1,829,091
1,776,354
1,683,240
1,979,372
1,448,910
81,772,858
93,485,055
94,654,083
82,417,902
85,057,435
1,851,445
(4,979,391)
(5,392,314)
(2,493,469)
(2:169,271)
14,660,000
(14,315,000)
1,038,185
318,000
221,791
6,812,260 6,353,216 8,972,495 7.494,560 5,806,834
(6,958,046) (6,329,136) (6,614,806} (6,411,15(1) (4,657,326)
172.214 24,180 2357,689 2,688,386 1,149,508
$2,023,659 ($4,955,311) (94,034,625 $194,117 ($1,019,763)
5.6% 51% 5.3% 6.2% -5 2%
121
$12,000
$10,000
$8v000
$6,000
$4,000
$2,000
so
k
ASSESSED AND ESTIMATED ACTUAL
VALUE OF TAXABLE PROPERTY
LAST NINE FISCAL YEARS
2003 2004 2005 2006 2007 2008 2009 2010 2011.
—0—Unsecured Property Secured Property
Fiscal
Year
Residential
Property
Ileal Property
Commercial Industrial
ProRerty Property
dither
Total Real
Secured
Property
Unsecured
Property
Total
Assessed (a}
Total
Estimated Direct
Full Market fail Tax Rate h
2003
$4,827,556,658
$ 1,480,344,464
$128,546,036
$74,236,658
$6,510,683,816
$445,297,553
$6,955,981,369
$6955,981,369
0.20678°1
2004
5,160,984,286
1514,445,365
130,514,420
91,737,340
6,897,681,411
431,291,562
7,328,972,973
7,328,972,973
0.20661%
2005
5,510,630,728
1.546,579,852
146,8221250
91875,824
7,297,908,654
406,163,129
7,704,071,783
7,704,071,783
0.19903%
2006
6,018,318,932
1,618,091,589
177,974,231
91,321,393
7,905,706,145
407,016,133
8,312,722,278
8,312,722,278
0.19349%
2007
6,544,841,348
1,745,483,576
197,040,979
122,977,950
8,610,343,853
376,890,454
8,987,234,307
8,987,234,307
0.18087%
2008
7,024,610,641
1,824,656,505
214,341,528
105,409,028
9,169,017,702
362,727,209
9,531,744,911
9,531,744,911
0..17718%
2009
7,357,121,277
1,941,927,620
234,669,841
129,177,656
9,662,896,394
374,976,613
10,037,87307
10,037,873,007
0,17951%
2010
7,335,863,721
2,052,276;292
244,857,019
130,177,994
9,763,175,026
401,201,906
10,164,376,932
10,164,376,932
0.19215%
2011
7,215,965,203
2,056,985,417
2.47,409,955
124,426,487
9,6114,787,062
383,414,952
10,028,202,014
10,028,202,014
0.17851%
Soa—: HdL Core. & Cone, Iam Count•{ Assessor 200i/02-2014111 Combined Tax Ro(1s
(a) The State Constitution requires property to be assessed at one hundred percent of the most recent purchase price, plus an increment of no more than two percent annually,
plus any local over -rides. These values are considered to be full market values_
(b) California cities dr not set their own direct tax rate. The state constitution establishes the rate at I % and allocates a portion of that amount, by an Dual calculation, to all
the taxing entities within a tax rate area.
Im
CITY OF SAN RAFAEL
PROPERTY TAX RATES
ALL OVERLAPPING GOVERNMENTS
LAST TEN FISCAL YEARS
Fiscal
School
Misc. Special
Year
City
County (1)
Districts
Districts
Total
2002
0.154
0.295
0.5873
0.0461
1,0820
2003
0.154
0.295
0.6163
0.0461
1.1110
2004
0.154
0.295
0.6483
0.0461
1.1430
2005
0.154
0.295
0.6593
0.0461
1.1540
2006
0,154
0.295
0.6828
0.0461
1.1775
2007
0.154
0.295
0.7160
0.0461
1.2107
2008
0.154
0.295
0.7225
0.0461
1,2172
2009
0.154
0.295
0.7192
0.0461
1,2139
2010
0.154
0.295
0,7402
0.0461
1.2349
2011
0.154
0.295
0.7542
0.0461
1.2489
Notes.
(1) Like other cities, San Rafael includes several
property
tax rate areas
with different rates.
A mean average is indicated.
Source; Marin County Assessors Office 2001;'02 - 2010'11 Tax Rate Tables
123
CITY OF SAN RAFAEL
PRINCIPAL PROPERTY TAX PAYERS
CURRENT YEAR AND EIGHT YEARS AGO
Taxpayer
Northgate Mall Associates
SR Corporation Center Phase I
SR Corporation Center Phase Two
Corac LLC
Sutter Health
Robert Dickson Trust
Regency Center 11 Associates LP
Northbay Properties I I
Marm Sanitary Service
Kilroy Realty LP
AMG Realty Partners LP
Lucas Digital Ltd. LLC
Autodesk Inc
4040 Civic Center LLC
Tele-Vue Systems Inc
Bay Apartment Communities
Subtotal
Total Net Assessed Valuation:
Fiscal Year 2010-2011
Fiscal Year 2002-2003
2010-11
2002-2003
41,900,697
Percentage
37,334,639
Percentage
34,090,441
of Total City
30,959,326
of Total City
Taxable
Taxable
Taxable
Taxable
Assessed
Assessed
Assessed
Assessed
Value
Value
Value
Value
$124,804,203
1.24%
$80,357,695
1.16%
78,722,382
0.79%
45,538,519
0,65%
71,885,994
032%
59,878,503
0.60%
0.00%
48,295,644
0-48%
0.00%
43,972,278
0,44%
0,00%
41,605,911
0.41%
36,325,034
0.52%
38,739,218
0,39%
30,142,083
0A3%
38,498,898
0.38%
0.00%
36,499,999
0,36%
0.00%
$582,903,030 5.81%
$10,028,202,014
$6,955.981,369
68,508,225
0.98%
41,900,697
0.60%
37,334,639
0.54%
34,090,441
0A9%
30,959,326
0.45%
30,619,158
0.44%
$435.,775,817
6,26%
Source: I IdL Corea &Cone, Marin County ,'Asessor2002-2003 & 2010-2011 Net Taxable Value History
124
$25
O
$22
$19
$16
$12
$9
$6
CITY OF SAN RAFAEL
LAST TEN FISCAL YEARS
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Delinquent taxer
Fiscal as a Percent of
Year Rate Levies Allocations Collecti2L-A!222qonmentsDalinqueneies Allocations
2002
1.00
(2)
12,293,952
(2)
$12,293,952
(2)
0.0%
2003
1.00
(2)
13,983,697
(2)
13,983,697
(2)
0.0%
2004
1.00
(2)
14,895,188
(2)
14,895,188
(2)
0.0%
2005
1.00
(2)
17,385,722
(2)
17,385.722
(2)
0.0%
2006
1.00
(2)
20,848,887
(2)
20,848,887
(2)
0.0%
2007
1.00
(2)
20,360,475
(2)
20,360,475
(2)
0.0%
2008
1 M
(2)
22, 195,606
(2)
22,195,606
(2)
0,0%
2009
1.00
(2)
21,978,859
(2)
21,978,859
(2)
0,0%
2010
1.00
(11)
21,702,536
(2)
21,702,536
(2)
0.0%
2011
1.00
(2)
21,632,731
(2)
21,632,731
(2)
0.0%
Notes:
(1) Includes
deductions
lbr County
vrovertv tax administration.
(2) Information
not aniflicable. All
General vuroose vrovertv
taxes are levied by the
county and allocated
to other aovernmental entities.
Source: San Rafael Finance Department Revenue Reports
am
$60
$50
$40
$30
$20
$10
CITY F SAN AAFAEL
O
W�;W-34
LAST TEN FISCAL YEARS
Note : Debt amounts exclude any premiums, discounts, or other amortization amounts,
Sources: City of San Rafael
State of California, Department of Finance (population)
U.S. Department of commerce, Bureau of the Census (income)
(a) See Schedule of Demographic and Economic Statistics for personal income and population data,
126
2002
2003 2004
2005
2006
2007 2008 2009
2010 2011
Governmental Activities
RDA Tax
Financing
Court Fine
Capitalized
Pension
Fiscal
Allocation
Authority
Note
Promissory
Lease
Obligation
Year
Bonds
Revenue Bond! Payable
Note
Obligations
Bonds
Total
2002
$43,479,004
$3,335,000 $
169,000
-
-
-
$ 46,983,004
2003
44,914,000
2,820,000
169,000
-
-
-
47,903,000
2004
43,239,004
2,340,000
169,000
-
-
-
45,748,004
2005
41,514,004
1,685,000
169,000
-
-
-
43,368,004
2006
40,849,107
1,155,000
169,000
-
$ 412,441
-
42,585548
2007
39,217,501
950,000
169,000
$ 1,029,717
596,927
-
41,963,145
2008
37,537,161
780,000
169,000
816,119
401,155
-
39,703,435
2009
35,793,692
455,000
169,000
594,100
198,816
-
37,210,608
2010
35,355,988
0
169,000
363,328
135,330
-
36,023,646
2011
33,298,499
0
169,000
124,222
69,098
$ 4,490,000
38,150,819
Business -Type
Activities
Parking
Total
Percentage
Fiscal
Services
Primary
of Personal
Per
Year
Bonds
Total
Government
IncoELUA
�taa
2002
-$46,983,004
123%
$ 828.76
2003
$ 7,605,000
$7,605,000
55,508,000
154%
973.72
2004
7,605,000
7,605,000
53,353,004
2.34%
933.04
2005
7,605,000
7,605,000
50,973,004
114%
890.76
2006
7,455,000
7,455,000
50,040,548
1.97%
872.56
2007
7,300,000
7,300,000
49.263,145
1,85%
848,68
2008
7,140,000
7,140,000
46,843,435
1.73%
804.39
2009
6,975,000
6,975,000
44,185,608
1.67%
757.08
2010
6,805,000
6.805,000
42,828,646
1,85%
728.11
2011
6,630,000
6,630,000
44,780,819
N/A
770,28
Note : Debt amounts exclude any premiums, discounts, or other amortization amounts,
Sources: City of San Rafael
State of California, Department of Finance (population)
U.S. Department of commerce, Bureau of the Census (income)
(a) See Schedule of Demographic and Economic Statistics for personal income and population data,
126
CITY OF SAN RAFAEL
COMPUTATION OF DIRECT AND OVERLAPPING DEBT
June 30, 2011
2010-11 Assessed Valuation: $10,028,202,014
Redevelopment Incremental Valuation: 2,246,741,694
Adjusted Assessed Valuation: $7,781,460320
(1) Percentage of overlapping agency's assessed valuation located within boundaries of the city,
(2) Include city's share of Marin Emergency Radio Authority refunding revenue bonds.,
(3) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and tax allocation bonds and non -
bonded capital lease obligations.
Ratios to 2010-11 Assessed Valuation:
Total Overlapping Tax and Assessment Debt L21%
Ratios to Adjusted Assessed Valuation:
Gross Combined Direct Debt ($14,261,032) 0.18%
Net Combined Direct Debt ($7,631,032) 0,10%
Gross Combined Total Debt 2.15%
Net Combined Total Debt 2,07%
STATE SCHOOL BUILDING All) REPAYABLE AS OF 6/30/1 $0
Source: California Municipal Statistics, Inc,
127
Total Debt
City's Share of
OVERLAPPING TAX AND ASSESSMENT DEBT:
6/30/2011
O/o
Debt 6/30/09
Marin Community College District
$180,400,000
14.992010
$27,045,568
San Rafael High School District
53,320,315
74254%
39,592,467
Tamalpais Union High School District
167,530,000
0.085%
142,401
Dixie School District
7,805,810
67208%
5,246,129
Ross School District
18364,941
1.674%
307,429
Ross Valley School District
23,149,639
0.008%
1,852
San Rafael School District
61,823,301
78,402%
48,470,704
TOTAL OVERLAPPING TAX AND ASSESSMENT DEBT
$120,806,550
DIRECT AND OVERLAPPING GENERAL FUND DEBT:
Marin County Certificates of Participation
$79.984,112
14967%
$11,971,222
Marin County Pension Obligations
111,480,000
14967%
16,685,212
Marin County Transit District General Fund Obligations
219,185
14,967%
32,805
Marin Municipal Water District General Fund Obligations
178,320
19.117%
34,089
Marin Community College District Certification of Participation
2,855.834
14.992%
428,147
San Rafael School District Certificates of Participation
4,085,000
78.402%
3,201722
City of San Rafael General Fund Obligations
9,771,032
100,000%
9,771,032 (2)
City of San Rafael Pension Obligations
4,490,000
100.000%
4,490,000
TOTAL DIRECT AND OVERLAPPING GENERAL FUND DEBT
$46,615,229
Less: City of San Rafael lease revenue bonds supported by enterprise
revenues
6,630,000
TOTAL NET DIRECT AND OVERLAPPING GENERAL FUNJ) DEBT
39,985,229
TOTAL GROSS DIRECT DEBT
$14,261,032
TOTAL NET DIRECT DEBT
$7,631,032
TOTAL OVERLAPPING DEBT
$153,160,747
GROSS COMBINED TOTAL DEBT
$167.421,779 (3)
NE FCOMBINED TOTAL DEBT
$160,791,779
(1) Percentage of overlapping agency's assessed valuation located within boundaries of the city,
(2) Include city's share of Marin Emergency Radio Authority refunding revenue bonds.,
(3) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and tax allocation bonds and non -
bonded capital lease obligations.
Ratios to 2010-11 Assessed Valuation:
Total Overlapping Tax and Assessment Debt L21%
Ratios to Adjusted Assessed Valuation:
Gross Combined Direct Debt ($14,261,032) 0.18%
Net Combined Direct Debt ($7,631,032) 0,10%
Gross Combined Total Debt 2.15%
Net Combined Total Debt 2,07%
STATE SCHOOL BUILDING All) REPAYABLE AS OF 6/30/1 $0
Source: California Municipal Statistics, Inc,
127
CITY OF SAN RAFAEL
COMPUTATION OF LEGAL BONDED DEBT MARGIN
6/30/20111
Source: California Municipal Statistics. Inc, and City of San Rafael's Management Service Department
Note: Data not available for 2002
128
ASSESSED VALUATION:
$10,028,202,014
BONDED DEBT LIMIT`
(3.75% OF ASSESSED VALUE) (a)
376,057,576
LESS AMOUNT OF DEBT SUBJECT TO LIMIT:
37,788,499
LEGAJ_ BONDED DEBT
MARGIN
$338,269,077
Total net debt
Total :Vet Debt
Legal
applicable to the limit
Fiscal
Debt
Applicable to
Debt
as a percentage
Year
Limit
Limit
Margin
of debt limit
2002
n/a
$43,479,004
n/a
n/a
2003
$ 260,849,301
44,914,000
$ 215,935,301
20.80%
2004
274,836,486
43,239,004
231,597,482
1&67%
2005
288,902,692
41,514,004
247,388,688
16.78%
2006
311,727,085
40,849, 107
270,877,978
15.08%
2007
337,021,287
39,217.501
297,803,786
13,17%
2008
357,440,434
37,537,161
319,903,273
1133%
2009
376.420,238
35,793,692
340,626,546
10.51%
2010
381,164,135
35,355,988
345,808,147
10.22%
2011
376,057,576
37,788,499
338,269,077
11,17%
NOTE: (a) California Government Code, Section
43605 sets the debt limit at 15%. The
Code section was enacted prior to the
change in basing assessed value to
fall market value when it was previously
25% of market value. Thus, the limit
shown as
3.75% is one-fourth
Source: California Municipal Statistics. Inc, and City of San Rafael's Management Service Department
Note: Data not available for 2002
128
4.00
3.00
2.00
1.00
0.00
CITY OF SAN RAFAEL
REVENUE BOND COVERAGE
PARKING FACILITY
LAST EIGHT FISCAL YEARS
2004 2005 2006 2007 2008 2009 2010 2011
-P— Coverage
Debt Service Requirements
Net Revenue
Fiscal
Gross
Operating
Available for
Year
Revenue (1)
Expenses (2)
Debt Service
Principal Interest
Total
Coverage
2044
S 2,336,966
$1,498,740
S 838,22E
- -
-
N/A
2005
2,632,588
1,964,713
667,875
- $ 431,958
$ 431,958
1.55
2006
3,069,915
1155,435
914,480
$ 150,000 344,441
494,441
1.85
2007
3,331,754
2,344,285
987,469
155,000 339,904
494,904
2.00
2008
4,089,112
2,692,08E
1,397,026
160,000 335,216
495,21E
2.82
2009
41425,813
2,980,083
1,445,730
165,000 330,379
495379
2.92
2010
4,262,082
3.343,680
918,402
170,000 325,285
495,285
1.85
2011
4,023,211
3,101,411
921,800
175,000 319,391
494,391
1.86
Notes:
On March 26, 2003,
the City Financing
Authority issued
lease revenue bonds for the design and construction
of a new park
(1) Includes all Parking
Facility Operating Revenues and Non-operating Interest Revenue
(2) Includes all Parking Facility Operating Expenses
less Depreciation and Interest
Source:
City of San Rafael Annual Financial Statements
129
CITY OF SAN RAFAEL
REDEVELOPMENT PLEDGED REVENUE COVERAGE
LAST TEN FISCAL YEARS
1999 RDA Tax Allocation Bonds (1)
Funding Source: RDA tax increment revenues
Fiscal
Year
Available
Revenue
Debt Service Requirements
Principal Interest Total
Coverage
2002
$1,499,475
$525,000
$974,445
$1,499,445
1,00
2003
1,499,600
550,000
949,600
1,499,600
L00
2004
1,497,881
575,000
922,881
1,497,881
1.00
2005
1,499,856
605,000
894,856
1,499,856
1,00
2006
1,495,525
630,000
865,525
1,495,525
1.00
2007
1,499,769
665,000
834,769
1,499,769
1.00
2008
1,497,469
695,000
802,469
1,497,469
1.00
2009
1,498,625
730,000
768,625
1,498,625
1.00
2010
1,255,830
765,000
490,830
1,255,830
1.00
2011
0
0
0
0
0
2002
RDA Tax Allocation Bonds
Funding Source: RDA tax increment revenues
Fiscal
Year
Available
Revenue
Debt Service Requirements
Principal Interest Total
Coverage
2002
NIA
N/A
NIA
N/A
N/A
2003
$2,069,768
$1,475,000
$ 594,768
$ 2,069,768
1.00
2004
2,069,425
1,100,000
969,425
2,069,425
1.00
2005
2,067,225
1,120,000
947,225
2,067,225
1.00
2006
2,069,575
1,145,000
924,575
2,069,575
1.00
2007
2,066,475
1,165,000
901,475
1066,475
1.00
2008
2,070,381
1,195,000
876,381
2,071,381
1.00
2009
2,070,150
1,235,000
835,150
2,070,150
1.00
2010
2,068,338
1,290,000
778,338
2,068,338
1.00
2011
2,068,938
1,350,000
718,938
2,068,938
1,00
2009 RDA Tax Allocation Bonds (1)
Funding Source: RDA tax increment revenues
Fiscal Available Debt Service Requirements
Year Revenue Principal Interest Total Coverage
2010 $265,445 $ 265,445 $ 265,445 1.00
2011 1,494,725 $ 875,000 619,725 1,494,725 1.00
Notes: The 1999 RDA Tax Allocation Bonds, Current Interest Bonds portion were refunded by the issr
2009 RDA Tax Allocation Bonds in December 2009. The Capital Appreciation Bunds mature annually
December 1 2018. No pledged revenue is required for 1999 Capital Appreciation Bonds at June 30, 201
Source: San Rafael Finance Department
130
CITY OF SAN RAFAEL
ZVV4 LVW ZVV4 LUV3 ZUVD LW :1 ZVVO IVV'J /V IV ZV1 I
0 City Population as a % of Count), Population
MIN
.2
ME
$35
W
Per Capita Personal Income (2)
$3,000,000
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
$0
21102 2003 2004 2005 2006 2007 2008 2009 2010 2011
E Personal Income (2) (in thousands
0 Unemployment Rate (1/4)
Source (1) State of California, Department of Finance - Demographic Research Unit, The data represents the City's population
January 1, of each year.
(2) Regional Economic Information System, Bureau of Economic Analysis, U.S. Department of Commerce. Data is Ma
county-Nvide rate.
(3) Employment Development Department, Labor Market Information Division, Data represents Marin county -wide rat,
only and is not seasonally adjusted,
131
Personal
Per Capita
Average
Marin
city
Fiscal
city
Income (2)
Personal
Unemployment
County
Population
Year
t2211!ation (i)
_(m �thousands
Income (2)
Late (3)
Population
0x'0 of County
2002
56,691
$2,110.465
$ 37,269
4.90%
250,078
2167010
2003
57,006
2,181,297
38,152
4.90%
249,808
21820'0
2004
57,182
2,282,733
39,991
4,40%
251,330
22.75%
2005
57,224
2,382,096
41,765
3.900/0
252,485
22.66%
2006
57,349
2,544,221
44,400
3.50010
253,341
2164010
2007
58,047
2,663,922
46,152
3.70%
255,982
2168%
2008
58,235
2,703,213
46,557
4M%
257,406
22.62%
2009
58,363
2,642,978
45,288
7.60%
258,618
22.57%
2010
584822
2,317,704
39,402
9M%
260,651
22.57%
2011
58,136
n/a
n/a
9,60%
254,692
22,83010
Source (1) State of California, Department of Finance - Demographic Research Unit, The data represents the City's population
January 1, of each year.
(2) Regional Economic Information System, Bureau of Economic Analysis, U.S. Department of Commerce. Data is Ma
county-Nvide rate.
(3) Employment Development Department, Labor Market Information Division, Data represents Marin county -wide rat,
only and is not seasonally adjusted,
131
CITY OF SAN RAFAEL
PRINCIPAL EMPLOYERS
FISCAL YEAR 2010-2011
Source: State of California, Employment Development Department, Labor Market Information Division
San Francisco Business Times, 2011 Book of Lists
Note: Total employment in the City of San Rafael as of June 2011 was 27,000
132
Percentage of
Number of
total employment
Employer
Employees
in San Rafael
Kaiser Permanente
1,330
4.93%
Autodesk, Inc.
928
3.44%
City of San Rafael
592
2.19%
Comcast
619
2.29%
Safeway
452
1.67%
Macy's
450
1.67%
Dominican University of California
336
1.24%
MHN
350
1.30%
Bradley Real Estate
350
1.30%
Guide Dogs for the Blind
280
1.04%
Totals
5,407
20.03%
Source: State of California, Employment Development Department, Labor Market Information Division
San Francisco Business Times, 2011 Book of Lists
Note: Total employment in the City of San Rafael as of June 2011 was 27,000
132
■
IN
300.00
250.00
200.00
150.00
100.00
50.00
0.00
CITY OF SAN RAFAEL
UAMW �Pq- VM -;k
LAST TEN FISCAL YEARS
2002 2002 2004 2005 2006 2007 2008 2009 2010 2011
El General Government
* Public Works and Parks
* Culture and Recreation
IM Public Safety
El Community Development/Redevelopment
2002 2002 2004 2005 2006 2007 2008 2009 2010 2011
Function
General Government
39.20
41.73
49.27
47.02
53.71
59.38
59.88
58.88
56.88
54.35
Public Safety
203.03
203.03
201.63
193.13
188.86
189.00
186.00
183.00
165.00
166.00
Public Works and Parks
80.70
79.95
76.70
7180
74.80
76.80
78.80
78.80
60.80
62.80
Community Development Redevelopment
30.28
29,75
28.75
26.75
26.43
31.00
34.50
34.50
2635
26.75
Culture and Recreation
83.76
83.76
83.26
7933
77.49
80.22
85.90
85.90
83.49
89.82
Total
436.97
438.22
439.61
419.43
421.29
436.40
445.08
441.08
392.92
399.72
Source: City of San Rafael
133
CITY OF SAN RAFAEL
OPERATING INDICATORS BY FUNCTION/PROGRAM
LAST TEN FISCAL YEARS
M
2002
2003
2004
2005
2006
2007
Function/Program
Public safety:
Fire:
Inspection permit issued
N/A
NIA
N/A
N/A
N/A
143
Police:
Police calls for service
N/A
N/A
NIA
N/A
N/A
43,480
Law violations:
Part I crimes
N/A
N/A
N/A
N/A
N/A
2,557
Physical arrests (adult and juvenile)
N/A
N/A
NI/A
NIA
N/A
3,809
1'raffic violations
N/A
N/A
NIA
NIA
N/A
5,197
Parking violations
15,468
26,308
30,946
39,421
33,610
36,228
Public works
Street resurfacing (miles') (Eng- Div)
N/A
1,20
5,770
6,80
1.08
N/A
Potholes repaired (square miles)
N/A
N/A
N/A
VA
N/A
N/A
Asphalt used for street repairs (tons)
N/A
N/A
N/A
N/A
N/A
N/A
Culture and recreation:
Recreation class participants
6,000
7,000
7,000
7,000
8,000
8,000
Items in collection (thousands)
Library:
Items in collection (thousands)
121.85
128,12
118.24
121,81
123.12
124.46
Total items borrowed (thousands)
336.57
338,60
33233
29930
333.15
359,41
'VVastewater
Residential connections
Commercial connections
Other connections
Average daily sewage treatment (millions of gallons)
6,976
6.976
6.976
6.976
6.976
6,976
Note- N/A denotes information not available.
M
Function/Program
Public safety:
Fire.
Inspection permit issued
Police:
Police calls for service
Law violations:
Part I crimes
Physical arrests (adult and juvenile)
Traffic violations
Parking violations
Public works
Street resurfacing
, (miles) (Eng Div)
Potholes repaired (square miles)
Asphalt used for street repairs (tons)
Culture and recreation:
Recreation class participants
Items in collection (thousands)
Library:
Items in collection (thousands)
Total items borrowed (thousands)
Wastewater
Residential connections
Commercial connections
Other connections
Average daily sewage treatment (millions of gallons)
Note: N/A denotes information not available.
2008 2009 2010 2011
2177
196
307
294
43,488
42,227
42,227
39,512
2,314
2,352
2,352
2,180
4,182
4,48'
4,48' ,
3,102
9.241
5,777
5,777
8,190
42,481
44,913
42,806
34,590
4.95
2.77
2.77
7.40
KIA
N/A
N/A
N/A
N/A
N /
�A
N'/1A
112,6
8,000
8,000
9,524
9,000
NIA
124,40
151,88
158,30
N/A
N/A
371.12
435.66
6,976 6,976
6.976 6.976
Function/Program
Public safety:
Fire stations
Police stations
Police Fleet
Public works
Miles of streets
Street lights
Parking District lights
Traffic Signals
Culture and recreation:
Community services:
City parks
City parks acreage
Playgrounds
City trails
Community gardens
Communih, centers
Senior centers
Sports centers
Performing arts centers
Swimming pools
Tennis courts
Basketball Courts
Baseball/softball diamonds
Soccer"football fields
Library:
City Libraries
Wastewater
Miles of sanitarysewers
Number of treatment plants
( 1) Source: City of San Rafael
CITY OF SAN RAFAEL
CAPITAL ASSET STATISTICS BY FUNCTION/PROGRAM
LAST TEN FISCAL YEARS
2002 2003 2004 2005 2006 2007
6 6 6 6 6 6
1 1 1 1 1 1
171
171
172
172
173
173
4,200
4,200
4,333
4,333
4,435
4,435
85
85
85
85
89
89
19
19
19
19
19
19
41
41
41
41
41
41
13
13
13
13
13
13
15
Is
15
15
15
20
2
2
2
2
1
1
4
4
4
4
4
4
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
1
to
1
10
1
to
1
10
1
10
1
10
5
5
5
5
5
5
5
5
5
5
5
5
2
1
2
1
2
t
2
1
2
1
2
1
176,90
178,40
179,15
179.15
179.15
179.15
51.40
1
5150
1
57.60
1
5760
1
57,60
1
57.60
1
136
Function/Program
Public safety:
Fire stations
Police stations
Police Fleet
Public works
Miles of streets
Street lights
Parking District lights
Traffic Signals
Culture and recreation:
Community services:
City parks
City parks acreage
Playgrounds
City trails
Community gardens
Community centers
Senior centers
Sports centers
Performing arts centers
Swimming pools
Tennis courts
Basketball Courts
Baseball/softball diamonds
Soccer/football fields
Library:
City Libraries
Wastewater
Miles of sanitary sewers
Number of treatment plants
(1) Source: City of San Rafael
2008 2009 2010 2011
6
6
6
6
1
1
1
1
173
173
173
173
4,435
4,435
4,435
4,435
89
89
89
89
20
20
20
20
42
42
42
42
14
14
14
14
20
1
20
20
20
4
1
4
1
4
1
4
0
0
0
0
0
0
0
0
0
1
0
0
0
10
1
to
1
10
1
10
5
5
5
5
5
5
5
5
2
2
2
1
?
2
179,15
179,15
179
179
57.60
1
57.60
1
58
1
58
1
137
This Page Left Intentionally Blank
MAZE &
ASSOCIATES
ACCOUNTANCY CORPORATION
`�47 Buskirk-
Aa
1 S H
A �i
` asant Hi" hif ig, 9 4523
I& I 1� C
X2 0-09, , FA3X(S;,, 936 0135
Count
mxw'
Honorable Mayor and Members of the City Council
City of San Rafael, California
We have applied the procedures below to the Appropriations Limitation Worksheet for the City of San Rafael for
the year ended June 30, 2012. These procedures, which were suggested by the League of California Cities and
presented in their Article XHM Appropriations Limitation Uniform Guidelines were performed solely to assist
you in meeting the requirements of Section 1.5 of Article XUR3 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 this 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. This report is intended for the information of management and the City Council; however, this
Zn
restriction is not intended to limit the distribution of this report, which is a matter of public record.
The procedures you requested us to perform and our findings were as follows:
A. We obtained the Appropriations Limitation Worksheet and determined that the 2011-2012
Appropriation Limit of $100,987,678 and annual adjustment factors were adopted by resolution of the
City Council. There is a $3,890,000 increase due to Measure I. We also determined that the population
and inflation options were, selected by a recorded vote of the City Council,
B. We recomputed the 2011-2012 Current Appropriations Limit by multiplying the 2010-2011
Appropriations Limit by the annual adjustment factors and adding $3,890,000 of addition tax under the
Measure I initiative passed by the citizens of the City of San Rafael in November 2010.
C. For the Appropriations Limitation Worksheet, we agreed the Per Capita Income, County and City
Population Factors to California State Department of Finance Worksheets.
These agreed-upon procedures are substantially less in scope than an audit, the objective of which is the
expression of an opinion on the Worksheet. Accordingly, we do not express such an opinion. I -lad we performed
additional procedures or had we made an audit of the Appropriations Limitation Worksheet and the other
completed worksheets described above- matters might have come to our attention, which would have been
reported to you.
1
CA
October 24, 2011
A Proressdun_�"' Corsicna6cn
CITY OF SAN RAFAEL
MEMORAN-DU,N'I ON INTERNAL CONTROL
AND
REQUIRED COTMMUNICATIONS
FOR ME YEAR ENDED
JU-TN'E 30, 2011
This Page Left Intentionally Blank
CITY OF SAN RAFAEL
MEMORANDUM ON INTERNAL CONTROL
AND
REQUIRED COMMUNICATIONS
For the Year Ended June 3U,2O11
Table of Contents
Memorandum omInternal Control .................................................................................. ................. l
Schedule ofOther Matters ............................................................. ..................... ....... .......... 3
Schedule of Prior Year Other Matters .................................................. ..................... ............. 7
Financial Statement Audit Assurance .............................. ........ ..... —................ .... --- ........ p
Other Information Included with the Audited Financial Statements ........ ............... .......... 9
AccountingPolicies .... ....... ................. ............................................... —............ —............. D
Unusual Transactions, Controversial or Emerging Areas ................................... ............... lO
Estimates......................................................... ....................................................................... lO
Disagreements with Management ............................................. ........................................... O
RetentionIssues .......... ..................... ................................................ ---........... ............... l8
Ddfi"oltiea............................ .................................. ............................... .................... —.... lO
AuditAdjustments .......................................................................................................
This Page Left Intentionally Blank
MAZE &
ASSOCIATES
ACCCOUNTANCY CORPORATION
AIIEMOR-NNDUM ON LNTERINNAL CONTROL 347-6 Svskh-k A 2 1
9
JI -IB!, i s>'a
X (92�.,, 930-0 135
October 218, 2011
To the City Council of
the City of San Rafael
San Rafael, California
We have audited the financial statements of the City of San Rafael for the year ended June 30, 2011, and
have issued our report thereon dated October 28, 2011, In planning and performing our audit of the
financial statements of the City of San Rafael as of and for the year ended June 30, 2011, in accordance
with auditing standards generally accepted in the United States of America, we considered the City's
internal control over financial reporting (internal control' as a basis for designing our auditing procedures
for the purpose of expressing our opinions on the financial statements, but not for the purpose of
expressing an opinion on the effectiveness of the City's internal control. Accordingly, we do not express
an opinion on the effectiveness of the City's internal control.
A deficiency in internal control exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, to prevent, or
detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination
of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement
of the entity's financial statements Will not be prevented, or detected and corrected on a timely basis. We
did not identify any deficiencies in internal control that we consider to be material weaknesses, as defined
above.
A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less
severe than a material weakness, yet important enough to merit attention by those charged with
governance.
Our consideration of internal control was for the limited purpose described in the first paragraph and was
not designed to identify all deficiencies in internal control that might be significant deficiencies or
material weaknesses and, therefore, there can be no assurance that all such deficiencies have been
identified. In addition, because of inherent limitations in internal control, including the possibility of
management override of controls, misstatements due to errors or fraud may occur and not be detected by
such controls.
Included in the Schedule of Other Matters are recommendations not meeting the above definitions that we
believe to be of potential benefit to the City.
The City's written responses included in this report have not been subjected to the auditing procedures
applied in the audit of the Financial statements and, accordingly, we express no opinion on them
This communication is intended solely for the information and use of management, City Council, others
within the City, and agencies and pass-through, entities requiring compliance with generally accepted
Z� C� C,
government auditing standards. and is not intended to be and should not be used by anyone other than
these specified parties.
, -0--
b LAAA96
This Page Left Intentionally Blank
CITY OF SAN RAFAEL
MEMORANDUM ON INTERNAL CONTROL
SCHEDULE OF OTHER MATTERS
2011-01 -- Enforceable Obligations Payment Schedule
California Health and Safety Code Section 34169(8)(1) requires the redevelopment agency to:
".....adopt an Enforceable Obligation Payment Schedule that lists all of the obligations that
are enforceable within the meaning of subdivision (d) of Section 34167 which includes the
following information about each obligation:
(4) The project name associated with the obligation.
(B) The payee.
(C) A short description of the nature qf the work, product, service, facility, or other thing
of value for which payment is to he made.
(D) The amount of payments obligated to be made, by month, through December 2011.
The Enforceable Obligation Payment Schedule (EOPS) adopted by the Agency on September 6, 2011, listed
two obligations which show "various" as payees. These obligations amounted to $23,470 for maintenance
of RDA offices and $44,130 for legal services.
We recommend that the Agency amend the FOPS to include payee information on the Schedule,
Management Response: Agency staff will update the FOPS to reflect the payee information.
2011-02 -- Year -End Adjustment Assistance
On July 1, 2010, the City issued the 2010 Taxable Pension Obligation Bonds in the amount of $4,490,000
to preimid a portion of the obligations of the City to the Marin County Employees' Retirement
Association (MCERA), The bond proceeds were deposited in a separate account with MCERA. Every
pay period, MCER-.A, drew down the City's actuarial required contributions to MCERA from this account.
During the year, while the activities in this account were monitored by the City, its corresponding balance
in the City's general ledger was not adjusted to reflect the activities. During the year-end audit, City staff
brought this item to our attention and requested our assistance in recording the appropriate entries. The
balance in this account as of June 30, 2011 was $229,170.
Management Response: The department's practice in accounting for funds held by a fiscal agent is
to monitor funds during the fiscal year and to post a final general ledger reconciliation at year
end. Due to unique aspects of this bond, staff delayed the year-end general ledger reconciliation
in order to confirm the appropriate entries with the auditors.
2011-03 -- Information System Review
We conducted an Information Systems Review with Our audit which encompassed the financial
information system and the network environment that houses it.
Currently, there are no Information Technology standards to which local governments are required to
conform. Indeed there are a wide varier} of informal guidelines and suggested controls from many
different organizations which local governments can use to implement appropriate controls to ensure
adequate security over information technology, Our Information Technology staff have reviewed these
informal guidelines and concluded that the certification and accreditation framework developed by the
National Institute of Standards and 'I echnology (NIST) for the Federal Information Security Management
CITY OF SAN RAFAEL
MEMORANDUM ON INTERNAL CONTROL
Act (FISMA) are the most appropriate for local government. NIST and FISTMA represent the minimum
security requirements for federal government agencies information systems. NIST recommends these for
state and local governments. Our procedures included performing an external network scan based on
NIST criteria and in determining that internal control provides for:
• Internet access defenses including hacker prevention., detection and deterrent systems
• Security of data from physical or network access
• Adequately protecting data from unauthorized internal access
• Reasonable measures to ensure continuation of service
0 Information systems risk management
We noted a few areas during our Information System Review that could be improved, A summary of
these recommendations which we believe are "best practices", are as follows:
Payment Card Industry Compliance
The City is not in compliance with the Payment Card Industry Data Sccurity, Standard (PCI -DSS), Any
organization that processes credit cards is required to comply with PCI -DSS, even if the processing is
oritsourced. Failure to meet compliance requirements results in higher transaction fees and liability
if a
security breach is found. Because the City accepts credit cards as a form of payment, the City must be
compliant with the applicable controls.
A udit/Event Logging
The City does not appear to have audit logs on the financial application server, such that any change,
addition or deletion of user accounts within the application are tracked and monitored, The City should
have audiCevent logs of any addition, deletion or change in financial application user accounts and that
log should be monitored by someone without the rights to effect such changes, In addition, any
administrative access such as upgrades or application modifications by IT personnel, outside consultants
or vendors should also be logged and reviewed.`
Password 11anagement on the Tinancial Application
The City does not enforce regular password changes or require the use of complex passwords for users on
the financial application. There should be a 'written policy for the regular changing of financial system
account passwords and the use of complex passwords for users. An automatic enforcement of this policy
would be optimum, There should be enforced password complexity for the financial system to reduce the
risks of easy guessing and brute force attacks against the passwords. Required use of unique alpha
numeric and special character combinations along with a password length of at least 8 characters is
optimum. There should be a policy that requires a limit on repeating financial system account passwords.
This will stop users from circumventing password change controls. An automatic enforcement of this
policy would be optimum. Users should not share passwords with other users nor use password easily
guessed by other users.
"State, 'local, and tribal governments, as Nsell as private sector or.garrzatior,,s are encouraged to --on-sider using these V-1didelines,
as appropriate." NIST SP 800-3-1, Rev I pg I I
- For more info: -ation on AA;T/Event log mara_-,-,--,ent see NIST SP 800-92 Guidc w Con-ipu;�er Secarity Log -1%1a--,.age -rktnL
CITY OF SAN RAFAEL
N1FM0R,1NDIJTTNI ON INTERNAL CONTROL
Pass -word J14anagetnent-for Operating Systems
The City does not enforce regular password changes or require the use of complex passwords for users.
There should be a writ -ten policy for the regular changing of operating system account passwords and the
use of complex passwords for users. An automatic enforcement of this policy would be optimum. There
should be enforced password complexity for the operating system to reduce the risks of easy guessing and
brute force attacks against the passwords. Required use of unique alpha numeric and special character
combinations along with a password length of at least 8 characters is optimum. There should be a policy
that requires a lit -nit on repeating operating system account passwords. This will stop users from
circumventing password change controls. An automatic enforcement of this policy would be optimum.
Users should not share passwords with other users nor use password easily guessed by other users.
Session Locks
The City does not have session locks turned on for the financial application or the workstation operating
systems. A session lock is a temporary lockout of the operating system or financial application when a
user stops work and typically moves away from the immediate physical vicinity of the computer.
Generally, employees may leave their workstation for lunch or break and not log off or log out of the
application. This leaves the operating system or financial application open and available to any passerby.
Any person with physical access would be able to perform any tasks the absent user has privileges or
rights to do. At the very least workstations should be set to lock out the workstation after a period of
inactivity. Best practice would be to have both the operating system and financial application have
lockouts after a period of inactivity,
Management Response:
Payment Card Industry Compliance
Our IT Department along with our consultant from MarinIT continues to work diligently installing all the
updates needed to make our network PCI -DSS compliant,
AuditlEvent Logging
The City's Eden Financial System has an audit history for each application,
Password I�Iamgeinenl on the Financial Application
Password Management for Operating Systems
Session Locks
The IT Division has begun implementing various technical changes to the City's computer network in
order to bolster security. We are currently in the process of implementing changes to address issues
identified in previous audit reports as high risk, especially as they pertain to PCI compliance. We will
then continue to address other, lower priority, potential security issues, Additionally, IT has begun
addressing physical security of our communications and computer equipment by initiating inventory
control of all City owned devices. Our next plan is to work on addressing access control and user
management issues.
This Page Left 1p.tentionally Blank
CITY OF SAN, RAFAEL
MEMORANDUM ON LNINTERNAL CONTROL
SCHEDULE OF PRIOR YEAR OTHER MATTERS
2010-01 - Budgets and Cash Balances
In current year, the City's General Fund budget and liquidity remains a top priority. As of June 30. 1010,
General Fund available fund balances amounted to $1.4 million. This amount represents ten days of
general fund expenditures, a very low level of reserves.
During this year's audit, we reviewed the City's financial condition and satisfied ourselves that the City
had sufficient resources available that it could continue as a going concern through June 30, 2010,
Continued deficit spending reduces the likelihood that the City will be able to continue as a going
concern, meaning the City is able to pay its bills on time. With our next audit we will again be required to
review the City's financial condition and determine the likelihood of the City's status as a going concern.
Actual expenditures for fiscal year 2009-10 totaled $52.7 million and exceeded revenues by $835
thousand, compared to fiscal year 2008-09 expenditures of $56.5 million which exceeded that year's
revenues by $21 million. While we acknowledge the City's effort in taking steps in cutting down
expenditures, we recommend the City to continue to work toward a balanced budget, meaning current
year revenues are sufficient to pay for current year expenditures. Balancing the budget should continue to
be the top priority. Secondarily, close management and comparison of actual activities against the budget
should be continued to ensure further costs reductions are made as needed. Lastly, the City must continue
to monitor its cash and investments balance in order to ensure that cash balance, needed for the "dry
spell" and to finance cash flows, is maintained for the overall City.
Management Response: The City's financial condition continues to be a top priority. Significant cost
cutting measures occurred in January 2010 which included layoffs, eliminations of vacant positions, and
reductions in operating expenditures, Full year savings will occur in fiscal year 2010-2011.
To help maintain its cash flow, the City issued a $6.08 million 'Fax and Revenue Anticipation Note in
July 2010. Also, to help achieve some short term relief on the City's increasing pension costs, the City
issued $4.49 million in Pension Obligation Bonds (POB), The POB will generate revenues to off -set the
V�l
pension increases for fiscal year 2010-2011 and one or more additional year.
Current Year Status: The City continues to make sound financial management its number one priority.
Over the past several years, there has been continuous cost cutting measures implemented including
layoffs, elimination of vacant positions, and reductions in operating expenditures. Most recently, the
City's employee groups all bargained a two year contract for 2011-2013 in which they agreed to an
across-the-board 4% reduction in total compensation.
As a result of these major efforts, the City was able to end FY 2011-12 with a General Fund Balance of
$6,785,511, a reduction of only 516,284 from the previous year. After many years of declining fund
balances, this reflects a significant step toward achieving financial stability. Further, in Its 2011-12
General Fund Budget.. the City was able to adopt a balanced budget in which current year revenues are
adequate to cover current expenditures. This provides further confirmation that the City has taken the first
steps on the path to restoring its financial health,
This Page Left Intentionally Blank
MAZE &
ASSOCIATES
ACCOUNTANCY CORPORATION
REQUIRED COMINfuNICATIONS 314 -16-f Husklr!,-i A ve, e 2 -15
Hill, Californi 6W,-,
asard
325) 9-30-090 2 F, X (9,-25�j 3 -013
m
October 28, 2011
To the City Council of
the City of San Rafael
San Rafael, California
We have audited the financial statements of the City of San Rafael as of and for the year ended June 30,
2011, and have issued our report thereon dated October 28, 2011. Professional standards require that we
advise you of the following matters relating to our audit,
Financial Statement Audit Assurance: Our responsibility, as prescribed by professional standards, is to
plan and perform our audit to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit in accordance with generally accepted auditing standards does not
provide absolute assurance about, or guarantee the accuracy of, the financial statements. Because of the
concept of reasonable assurance and because we did not perform a detailed examination of all
transactions, there is an inherent risk that material errors, fraud, or illegal acts may exist and not be
detected by us,
Other Information Included with the Audited Financial Statements: Pursuant to professional
standards, our responsibility as auditors for other information in documents containing the City's audited
financial statements does not extend beyond the financial information identified in the audit report, and
we are not required to perform any procedures to corroborate such other information. Our responsibility
also includes communicating to you any information that we believe is a material misstatement of fact.
Nothing came to our attention that caused us to believe that such information, or its manner of
presentation, is materially inconsistent with the information, or manner of its presentation, appearing in
the financial statements. This other information and the extent of our procedures are explained in our
audit report.
Accounting Policies: Management has the responsibility to select and use appropriate accounting,
policies. A summary of the significant accounting policies adopted by the City is included in Note I to
the financial statements. During fiscal year 2010-11, there have been no initial selections of accounting
policies and no changes in significant accounting policies. However, the City adopted the provisions of
the following GASB Statement during the year:
GASB Statement No. 54 — Fund Balance Reportink, and Governmental Fund Tvpe
pe I
finitions -- This Statement established fund balance classifications that comprise a hierarchy,
based primarily on the extent to which a government is bound to observe constraints imposed
upon the use of the resources reported in governmental funds, The City's financial statements, as
well as Note 9 to the financial statements, were modified to include required disclosures.
GASB Statement 59 -- Financial Instruments Omnibus -- The objective of this Statement is to
update and improve existing standards regarding financial reporting and disclosure requirements
of certain financial instruments and external investment pools for which significant issues have
been identified in practice. This is a technical clean up pronouncement that had no material
impact to the financial statements.
I
Pror�-Ssfoi,,af Cor, o"'ap,ioa
9
Unusual Transactions, Controversial or Emerging Areas: No matters have come to our attention that
would require us, under professional standards, to inform you about (1) the methods used to account for
significant unusual transactions and (2) the effect of significant ificant accounting policies in controversial or
emerging areas for which there is a lack of authoritative guidance or consensus. Note 17B to the financial
4-1
statements discussed proposed dissolution of redevelopment agencies in California.
Estimates: Accounting estimates are an integral part of the financial statements prepared by management
and are based on management's current judgments. Those judgments are normally based on knowledge
and experience about past and current events and assumptions about future events. Certain accounting,
estimates are particularly sensitive because of their significance to the financial statements and because of
the possibility that future events affecting them may differ markedly from management's current
judgments. The most sensitive accounting, estimates affecting the financial statements are depreciation,
compensated absences and fair values of Investments.
Management's estimate of the depreciation., is based on useful lives determined by management.
These lives have been determined by management based on the expected useful fife of assets as
disclosed in Note 1. We evaluated the key factors and assumptions used to develop the
depreciation estimate and determined that it is reasonable in relation to the basic financial
statements taken as a whole.
Accrued compensated absences.- are estimated using accumulated unpaid leave hours and hourly
pay rates in effect at the end of the fiscal year. We evaluated the key factors and assumptions
used to develop the accrued compensated absences and determined that it is reasonable in
relation to the basic financial statements taken as a while,
Estimated Fair Value of Investments: As of June 30, 2011, the primary government of the City,
held approximately $44 million of cash and investments, as measured by fair value. Fair value is
essentially market pricing in effect as of June 30, 2011. These fair values are not required to be
adjusted for changes in general market conditions occurring subsequent to June 30, -1011,
Disagreements with Management: For purposes of this letter, professional standards define a
disagreement with management as a matter, whether or not resolved to our satisfaction, concerning a
financial accounting, reporting, or auditing matter that could be significant to the City's financial
Z:� -
statements or the auditor's report. No such disagreements arose during the course of the audit.
Management informed us that, and to our knowledge, there were no consultations with other accountants
regarding auditing and accounting matters.
Z,
I
Retention Issues: We did not discuss any major issues with management regarding the application of
accounting principles and auditing standards that resulted in a condition to our retention as the City's
auditors.
Difficulties: We encountered no serious difficulties in dealing with management relating to the
Z,
performance of the audit.
a
Audit Adjustments: For purposes of this communication, professional standards define an audit
adjustment, whether or not recorded by the City, as a proposed correction of the financial statements that,
in our judgment, may not have been detected except through the audit procedures performed. These
adjustments may include those proposed by us but not recorded by the City that Could potentially cause
future financial statements to be materially misstated, even though we have concluded that the
adjustments are not material to the current financial statements.
We did not propose any audit adjustments that, in out judgment, could have a significant effect, either
individually or in the aggregate, on the City's financial reporting process.
Uncorrected Misstatements: Professional standards require us to accumulate all known and likely
misstatements identified during the audit, other than those that are trivial, and communicate them to the
appropriate level of management. We have no such misstatements to report to the audit committee,
This report is intended solely for the information and use of the City Council, its committees, and
management and is not intended to be and should not be used by anyone other than these specified
parties.
M
This Page Left Intentionally Blank
SAN RAFAEL CITY COUNCIL
INSTRUCTIONS: USE THIS FORM WITH EACH SUBMITTAL OF A CONTRACT, AGREEMENT,
ORDINANCE OR RESOLUTION BEFORE APPROVAL BY COUNCIL / AGENCY.
FROM:
ffla•=: uTmlluM
DATE:
Janet Pendoley
Finance Department
December 15, 2011
SRRA / SRCC AGENDA ITEM NO
DATE OF
MEETING: 12/19/11
fwF
TITLE OF DOCUMENT: FY 2010-2011 ANNUAL FINANCIAL AUDIT REPORT; THE GANN APPROPRIATION
LIMIT REPORT, AND THE MEMORANDUM ON INTERNAL CONTROL
i
Depa meat Head (signature)
(LOWER HALF OF FORM FOR APPROVALS ONLY)
APPROVED AS COUNCIL / AGENCY
AGENDA ITEM:
City Manager (signature)
NOT
signa re)
NOT APPROVED
City Attorney (signature)