HomeMy WebLinkAbout2004/2005 Comprehensive Annual Financial Report - CAFR - wit CITY OF HUNTINGTON 1?iX&
INTER-DEPARTMENTAL CgNWjNI,0A- 3WN
�1r » FINANCE DEPARTMENkT ,
TO: Honorable Mayor and City Council Members
Penelope Culbreth-Graft, DPA, City Administrator
FROM: Dan T. Villella, CPA, Finance Director
DATE: March 23, 2006
CC: Finance Board, Executive Team
SUBJECT: COMPREHENSIVE ANNUAL FINANCIAL REPORT FISCAL YEAR
2004/2005
Attached is a copy of the City's Comprehensive Annual Financial Report (CAFR) for
the fiscal year ending September 30, 2005. The City received an unqualified or
"clean" opinion from its auditors, Caporicci and Larson, CPA's. The CAFR contains
detailed and summary financial information on the City, along with detailed historical
and narrative information on the City's financial condition.
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• CITY OF HUNTINGTON BEACH, CALIFORNIA
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• COMPREHENSIVE ANNUAL FINANCIAL REPORT
• FOR THE YEAR ENDED SEPTEMBER 30, 2005
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• WITH REPORT ON AUDIT BY INDEPENDENT CERTIFIED PUBLIC
• ACCOUNTANTS
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• Prepared by the Finance Department
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TABLE OF CONTENTS
INTRODUCTORY SECTION
Table of Contents.......................
. Letter of Transmittal.............................................................................................................................ii-vil
CityOfficials............................................................................................................................................vul
• Organizational Chart................................................................................................................................ix
Certificate of Achievement in Excellence in Financial Reporting..............................................................x
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• FINANCIAL SECTION
Independent Auditors' Report............................ ......1-2
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• Management Discussion and Analysis ................................................................................................3-13
Basic Financial Statements:
Government-wide Financial Statements:
Statementof Net Assets ................................................................................................................14
Statement of Activities and Changes in Net Assets.......................................................................15
• Fund Financial Statements:
Balance Sheet— Governmental Funds..........................................................................................16
Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Assets......17
• Statement of Revenues, Expenditures and Changes in Fund Balances—
GovernmentalFunds..............................................................................................................18-19
Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances
of Governmental Funds to the Statement of Activities................................................................20
Statement of Net Assets — Proprietary Funds................................................................................21
. Statement of Revenues, Expenses and Changes in Fund Net Assets— Proprietary Funds .........22
Statement of Cash Flows— Proprietary Funds ..............................................................................23
Statement of Fiduciary Fund Net Assets........................................................................................24
. Statement of Changes in Fiduciary Fund Net Assets—Trust Funds.............................................24
Notes to Financial Statements.....................................................................................................25-67
Required Supplemental Information:
Budgetary Information............. .......................... .................... ......................................68
Schedule of Revenues, Expenditures and Changes in Fund Balances— Budget
• And Actual —General Fund.........................................................................................................69
Schedule of Revenues, Expenditures and Changes in Fund Balances— Budget
And Actual — Public Financing Authority........................................................................................70
• Schedule of Revenues, Expenditures and Changes in Fund Balances— Budget
And Actual — Redevelopment Agency.........................................................................................70
Schedule of Revenues, Expenditures and Changes in Fund Balances— Budget
AndActual —Grants Fund...........................................................................................................71
Schedule of Funding Progress (Normal and Supplemental Retirement Plans) .............................72
Supplementary Information:
Combining and Individual Fund Statements and Schedules:
Combining Balance Sheet— Nonmajor Governmental Funds ..................................................74-77
. Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
Nonmajor Governmental Funds.............................................................................................78-81
Schedule of Revenues, Expenditures, and Changes in Fund Balances —
Budget and Actual — Non Major Governmental Funds.........................................:.................82-88
Combining Statement of Net Assets — Nonmajor Enterprise Funds..............................................90
• Combining Statement of Revenues, Expenses, and Changes in Net Assets—
Nonmajor Enterprise Funds ........................................................................................................91
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Combining Statement of Cash Flows — Nonmajor Enterprise Funds.............................................92
Combining Statement of Fiduciary Fund Net Assets .....................................................................94
STATISTICAL SECTION C
NetAssets by Component .......................................................................................................................96
Change in Net Assets- Last Four Fiscal Years..................................................................................96-97
Fund Balances — Governmental Funds— Last Ten Fiscal Years............................................................98
Changes in Fund Balances — Last Ten Fiscal Years.......................................................................99-100
Assessed and Actual Valuation of All Taxable Property.......................................................................101
Property Tax Rates—All Direct and Overlapping Government ............................................................101
Property Tax Levies and Collections— Last Ten Fiscal Years..............................................................102
Ratios of Outstanding Debt by Type — Last Ten Fiscal Years..............................................................103
Legal Debt Margin — Last Ten Fiscal Years..........................................................................................104
Principal and Private Employers— Current Year and One Year Ago....................................................104
Full-Time Budgeted City Employees by Program/Function ..................................................................105
Operating Indicators by Function/Activity..............................................................................................105
Capital Assets Statistics by Function/Activity........................................................................................105
Statement of Direct and Overlapping Bonded Debt..............................................................................106
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• ; . CITY OF HUNTINGTON BEACH
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• March 1, 2006
• To the Honorable Mayor and City Council
• City of Huntington Beach
Huntington Beach, California
The Charter of the City of Huntington Beach requires that the City's financial statements be audited
• each year by an independent accounting firm. This report fulfills that requirement for the fiscal year
• ending September 30, 2005.
• Management assumes full responsibility for the completeness and reliability of the information in
• this report, based upon a comprehensive framework of internal control established for this purpose.
• Because the cost of any control should not exceed the anticipated benefits, management's objective
• is to provide reasonable, but not absolute, assurance that the financial statements are free of any
material misstatements.
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Caporicci and Larson, CPAs, a firm of licensed, independent certified public accountants, has
• audited the City's financial statements for the year ending September 30, 2005. The auditors' report
is located at the front of the financial statement. The City received an unqualified (clean) opinion.
• The goal of the audit is to provide reasonable assurance that the financial statements of the City of
Huntington Beach are free of material misstatement. This independent audit involved examining, on
• a test basis, evidence supporting the amounts and disclosures in the financial statements;
assessing the accounting principles used and significant estimates made by management. The
• independent auditor concluded that there was a reasonable basis for rendering an unqualified
• (clean) opinion that the financial statements of the City of Huntington Beach for the fiscal year
ending September 30, 2005 are presented fairly in accordance with generally accepted accounting
principles. The opinion is presented as the first component of the financial section of this report.
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• This audit was part of a broader, federally mandated "Single Audit" designed to meet the needs of
• federal granting agencies. The standards governing these engagements require the auditor to
report not only on the fair presentation of the financial statements, but also on the City's internal
• controls and compliance with legal issues, especially concerning federal awards. These reports are
available from the City's Finance Department.
Management's discussion and analysis (MD & A) immediately follows the independent auditors'
• report and provides a narrative introduction, overview, and analysis of the financial statements. MD
& A complements this letter and should be read in conjunction with it.
ABOUT THE CITY OF HUNTINGTON BEACH
• The City of Huntington Beach is located along the Southern California coast in Orange County, 35
miles south of Los Angeles and 90 miles north of San Diego. With a population of approximately
200,000 residents, it is known as Surf City due to its abundance of beaches; sunny, warm
Mediterranean climate; and casual lifestyle. Huntington Beach covers 28 square miles of land, 26
square miles of water, and is the one of the 20 largest cities in California. With 8.5 miles of
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uninterrupted beach along the Pacific Ocean, the city also plays host to an annual visitor population +;
of over 11 million people, especially during the summer, special events and weekends. Listed
among the nation's safest cities for decades, Huntington Beach has often been ranked among the
Top Ten Safest Cities by City Crime Rankings.
The City of Huntington Beach is a full service city. Founded in the late 1880s, Huntington Beach
was incorporated as a Charter City in 1909. Huntington Beach has a City Council/City Administrator
form of government. The City Council has seven members, each of whom are elected to four-year
terms. City Council Members are limited to two consecutive terms. There are three elected
department heads, the City Attorney, City Clerk and City Treasurer. The position of Mayor is filled
on a rotating basis. Other departments include the City Administrator's Office, Building and Safety,
Community Services, Economic Development, Finance, Fire, Information Services, Library
Services, Planning, Police, and Public Works
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This report includes the financial activity of separate legal entities whose activities the City controls.
These entities are:
• Redevelopment Agency of the City of Huntington Beach
• Huntington Beach Public Financing Authority
• Huntington Beach Civic Improvement Corporation
• Various community facilities districts
• Reservoir Hill Assessment District
• Huntington Beach Auto Business Improvement District
A component unit report (stand-alone report) is available for the Redevelopment Agency.
The City operates on a fiscal year basis, beginning October 1st and ending September 30th. The
budget is prepared under the supervision of the City Administrator and transmitted to the City
Council for deliberation sixty days prior to the end of the fiscal year. The City Council adopts the
annual budget by September 30 h of the prior fiscal year and may amend it or revise it at any time at
a properly noticed meeting. Budgetary control is at the department level within each fund. A {
Department Head, with the Finance Director's approval, may transfer funds within like categories
(salaries and benefits, operating, and capital expenditures) of the same department. The City
Administrator may transferfunds within and between any objects of a fund ordepartment as long as E
the total fund budget is not changed.
LOCAL ECONOMY {
The City of Huntington Beach is one of the leading commercial and industrial centers in Southern t
California. The City works diligently to maintain its business friendly atmosphere, working closely
with the Huntington Beach Chamber of Commerce and the Huntington Beach Conference and
Visitors Bureau. The City seeks to attract new businesses and support existing business through
retention and expansion efforts. Benefits from tourism and continued modest economic growth
should allow for sustainable revenue growth for the City.
As the third largest city in Orange County, more than 60,000 people are currently employed by over R
12,800 businesses in the City. Huntington Beach residents represent nearly 10% of the entire c
Orange County working population. Huntington Beach businesses include aerospace and high i
technology; petroleum and petroleum support; manufacturing; computer hardware and software;
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financial and business services, automobile services; machine shop services, precision instruments,
! retailers and surf apparel, just to name a few.
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LONG-TERM FINANCIAL PLANNING
In November 2004 California voters approved Proposition 1A, which will help stabilize the flow of
• revenues to municipalities and end future State raids on City finances. This will allow for better
forecasting of City revenues and, along with modest economic growth, should allow for future
sustainable revenue growth. The City has made infrastructure improvements a major policy
initiative.
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• MAJOR INITIATIVES
Through its Strategic Plan, the Huntington Beach City Council seeks to assure a high quality of life
endures and improves as the City ages. The Strategic Plan was first created in July 2001 as a way
• to help the City Council assess the effects of today's decisions on the City's future quality of life. As
• a blueprint for the City's future, the Strategic Plan defines the City Council's goals and objectives.
The following are the City Council's strategic goals set forth in the City's development of the annual
budget:
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Public Safety - Maintain a healthy and safe community
• . Fiscal Integrity - Establish a sound financial foundation for the City's finances
Infrastructure and Transportation - Assure the long-term adequacy of the City's
• infrastructure, facilities, and transportation network.
• • Economic Development-Achieve development that maintains and improves the city's fiscal
• viability and reflects economic demands while maintaining and improving quality of life for
current and future residents
• . Organizational Development and Technology - Maintain and continually improve
organizational effectiveness.
0 Community Livability and Sustainability — Build and maintain a sense of place and an
exceptional quality of life within a sustainable urban environment.
• . Enrichment, Communication and Involvement - Ensure that Huntington Beach's local
government is open, accessible, responsive, nurturing, and respectful to all the citizens it
serves.
• Environment and Natural Resources—Enhance the community's environmental quality and
• its unique natural resources.
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The City is in the process of revising its Strategic Plan. This should be completed during the 2005-
! 06 fiscal year.
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• CASH MANAGEMENT POLICES AND PRACTICES
• The elected City Treasurer invests surplus cash in authorized investments allowed by the
• government code and City policy. The City adopts an annual Investment Policy intended to provide
• guidelines forthe prudent investment of the city's cash balances, and outlines the policies to assist
in maximizing the efficiency of the city's cash management system while meeting the daily cash flow
demands of the city. Both the Investment Advisory Board and the City Council approved the City's
• Investment Policy.
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• The investment practices and policies of the City of Huntington Beach are based upon state law and
prudent money management. The primary goals of these practices are:
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• To assure compliance with all Federal, State, and local laws governing the investment of
public funds under the control of the City Treasurer.
• To protect the principal moneys entrusted to the City Treasurer.
• Achieve a reasonable rate of return within the parameters of prudent risk management while
minimizing the potential for capital losses arising from market changes or issuer default.
The City forecasts revenues and expenditures to meet current obligations and to earn a market rate
of return on its investments. The City Treasurer earned a return of 2.97% for the year. The
California Government Code requires the City Treasurer to prepare an annual statement of
investment policy. The City Treasurer complied with this law. Note 3 to the General Purpose
Financial Statements shows further information on the City's cash and investments.
PENSION AND OTHER POSTEMPLOYMENT BENEFITS
The City of Huntington Beach is a member of the California Public Employees' Retirement System
(CALPERS) that provides benefits to all permanent employees. The City also maintains a
retirement supplemental plan to employees hired before 1999 (specific dates vary by employee
bargaining association). There are also certain post-retirement medical benefits available to
retirees. This information is detailed in notes 5,6, and 7 of the accompanying financial statements.
Below is summary information:
Unfunded
Percent Liability (in
Funded millions) C
Retirement— Normal Plan 90% $56.9
Retirement — Supplemental 35% 26.6
Post-Employment Benefits 42% 6.7
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The City has adopted actuarially sound funding plans to pay off the unfunded liabilities according to
studies conducted by CALPERS and independent actuaries. The City will implement Government
Accounting Standards Board Statement 45 (Other Post-Employment Benefits) for the fiscal year
ending September 30, 2006. The City has made contributions to this plan since its inception in
1991, but GASB 45 will require that the City contribute additional amounts than have been
contributed in past years. Options for this funding will be addressed during the next year. f
Risk Mana ement <
The City is self-insured for workers compensation and liability. These programs are recorded in the fi
general fund. The City is a member of the Big Independent Cities Excess Insurance Pool (BICEP)
to handle large claims. Further information on the City's risk management issues can be found in
note 8 of the financial statements. C
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AWARDS AND ACKNOWLEDGEMENTS:
The Governmental Finance Officers Association (GFOA)of the United States and Canada awarded
the Certificate of Achievement for Excellence in Financial Reporting to the City for its
Comprehensive Annual Financial Report ended September 30, 2004. This was the eighteenth
consecutive year the City has received this prestigious award. To qualify for the Certificate of
Achievement, the government entity must publish an easily readable and efficiently organized
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• Comprehensive Annual Financial Report, the contents of which conform to program standards.
• Such report must satisfy both generally accepted accounting principles as well as all legal
requirements.
The Certificate of Achievement is valid for one year only. The City believes that this
! Comprehensive Annual Financial Report continues to conform to the Certificate of Achievement
Program requirements and will be submitted to GFOA to determine its eligibility for another
! certificate.
! We wish to thank the City Council and the City Departments for responsibly conducting the fiscal
• affairs of the City of Huntington Beach. We would also like to thank Robert Sedlak, Valaya
! Chitchakkol, Maria D'Aloisio, Janet Lockhart, and Mavic Hizon of the Finance Department who
prepared this report.
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Dan T. Villella, CPA
• Finance Director
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CITY COUNCIL 2004/2005
Dave Sullivan, Mayor
Gil Coerper, Mayor Pro Ter
Keith Bohr, Councilmember
Debbie Cook, Councilmember
Cathy Green, Councilmember
Jill Hardy, Councilmember
Don Hansen, Councilmember
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City of Huntington Beach
Executive Team
Penelope J. Culbreth-Graft, City Administrator
Paul Emery, Deputy City Administrator
Robert Hall, Deputy City Administrator
Laurie E. Payne, Public Information Officer
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Department Directors
Ross D. Cranmer, Building & Safety
Robert Beardsley, Public Works
Jim B. Engle, Community Services
Joan L. Flynn, City Clerk
Shari L. Freidenrich, City Treasurer
Ron Hayden, Library
Jack Marshall, Information Services
Jennifer M. McGrath, City Attorney
Duane S. Olson, Fire t
Stanley Smalewicz, Economic Development
Kenneth Small, Police
Dan T. Villella, Finance
Howard S. Zelefsky, Planning
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• CITY OF HUNTINGTON BEACH
THE PEOPLE' `
CITY COUNCIL CITY
CITY CLERK � �:.•CITY" •, r ,�
Mayor TREASURER: ATTOR EYE:
0.eri�Fahllc Su;pon� Mayor Pro Tem Investrnenls Litiyalnn
City Council Members - 9ssiness Lsenae Ad6sory
• RI[anib - CITY Asaourts ReceivaD:e
Munic:^at Services
• ADMINISTRATOR Bi L.9 a
Cenral Casnierira;
FIRE :POLICE-
FINAkCEOFFICER
. Fire Adniristntisn ❑nibrrn Dirislon Rccuuminp
Fire Preven on tmves-lgation Division Cenral Senses
. E+caryarcy Response Admin Cp wi—
DEPUTY DEPUTY
ADMINISTIR ADMINISTRATOR
NUMANRESOURCES
'BUILDINGS ECONOMIC - - OommumlTY INF611140ION
,._SAFETY _ •UEYELOPMENT' +NNING _ F4Bl1G WORKS SEfMCES.. _- SERVICES �BRARYSERYICES
Permit 5 Redevelopn>3rt 8 Planning En,ceerin Beach C tians
Ptan Check Services Hous�n B P e:a S/'ems Adn smcen
Reareal.nn.Human 6
Ins ecvon Services Business�velopmeat Cade Ersforaen•.em Ullltea Convrunlca9ore CHsaens�Bransh
Cuknal Serrces
Alair..mance Fuililies. Operations Aa lil..7 iniwl
Rest Esate Sanc�es D ration CancesscnsS
TransporWon CB1'pA moot
0ctober2005
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Certificate of �
Achievement
for Excellence
in Financial
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Reporting
Presented to
City of Iuntington Beach, �
alifomia
For its Comprehensive Amiva.l �
Financial Report'
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for tiie:Fiscal Year Ended
Septeuikr 30, 2004
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ACurtificate ciFAcIdevenient for Exculleace inFinat-vial
Reporting is-presented by the isoverr_nientFinance Offi;:ers
Association ot'die United States arid.Cariadu w �
government uniis and public employt:e.retiremvnt �
systems w wi c:omptelm-ttsive annual finane a1
reports(CAFRs) achiccv the highest f
standards in Loverrunent account-Ang
and Financial reporting. fi
NITfA S�U.f:"tiv
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UUMPxrcw ry President
Executive Director
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C&L
i Caporicc[&Larson
IN!I7F'.I'FNI-)F',Nf'['AUDITORS1 REPORT
To the Honorable Nlayor and Mefnbers of City Council
of th,!Civ of Huntington 3-2ach
Huntington Beach,.Calif--mia
We have audited the accompanying finarxial statements of the governmentai activities, the business-
tyjx, activities, each major fund, and the of reixuiining fund information of the City of
HU-1-til-1-ItLITIBeach,California (City),as of and for the year ended September 30,2005, which collectively
cornFrIse the City's basic finmicial statem.crits as 1i,5jL-Qd in the table of contents. These filiaricial
statements are the respm-sibitity of the City's inanagenmeiA, Our responsibility is to express an.opinion
L -its based un our audi t.
on these financial s'-atem: eats
We conductod our ai:dit in acroi-dance with generally accepted auditing standards in the United Slates
and the 5tZ1h(AaTd5 applicabte to financial audits contained in Government Amdifinv 3tandards, issued by
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t ie Comptroller General of the Urifted States. Those standards require that-we plan and perform the.
audit to obtain reasonable assurance about whether the financial stntcments are free of material
wasstatement. An, audit includes examining, on a test basis, evidence supporting the a-mounts 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 basic financial
sLaleinent presentation. We belie-,7e that our audit provides a reasonable basis for our opinions.
In our opi-lion., the basic financial statemoits referred to above present---Lt fairly,in all material respects, the
resuectiv,finaricial Position of the govcrnrnc�ntal activities, the business-type activities, each-mior fund.,
and the -aggregate remoining fulid illfi-IM10601A Of the City aS Of September 30, 2005, and the respective
cha!19(1s in financial Position and cash flows, where applicable, thirenf for the year then ended in
conformity with generaily accepted accounting principles in the United States,
In accordance with Cavernment Aruliting Standards, we have also issued OUT report dated February 17,
2C06 on pur consideration of the City's intemal control over financial repotting and on our tests of its
compliance with certain provisiuns of laws, regulations,contracts, and grat.-its. That report is an integral
part of an audit performed in accordance with Goverriment Audillijig 5ilandards and should be read in
conj unc tior.with this report it L considering the results of o u r audit.
The LICCOITLpanyipg Required Su p plen-Len Lary Information, such as Nkmagemenfs Discussion and
Analysis,budgetary comparison information and other information as listed in the table of contents-are
not a requiTed part of'die basic financial statorrianLs but are supplementary information required by the
Governmental Accounting Standards Board. We .have appliod certain limited procedures, which
consisted principally of inquires of management regarding the nT. Lhods of rneasurp-ment and
presentation of the Roquired Supplementary Information. However, we did not audit the information
and express no opinion on it.
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ISO G rm1dAVV..StLRC 156$ 777 Chu,pus 01m amem Rd.,Uile 2W 4858 mtrcimT,Suite I M
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To the Honorable Mayor and!Members of City Council
of Hai,City of Huntington Beach
Huntington Beach,California
Our auda was conducted for the purpose of forming opinions on t'ne ,Financial statements that
collectively comprise the City's basic financial statements. The accompanying Suppkmentftry
Inforn-ki-ion is presented for purpose of additional analysis and, is not a required part of tr e basic
• lh.-Lancial statements. Tine Supplennentary In.forinat on has bean subjected to the auditing procedures
applied in the audit of the basic financial .;t�atertPrsts and,incur opinion, are fairly s itet4 in all material
respcUs in relation to tre basic finuuncial statements taken as a whole. The Introductory Section and
Statistical Tables have not been subiected to the auditing procedures applied in the audit of ffic basic
finamcial siaternents and, accordingly, we express rxo Opinion oci thorn.
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Cos - RMIesa,C:'afiorniva
February 1 ,2006
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City of Huntington Beach
Managements Discussion and Analysis
For the Year Ended September 30, 2005
As management of the City of Huntington Beach, we offer readers of the City's financial statements
this narrative overview and analysis of the financial activities of the City of Huntington Beach for the
fiscal year ended September 30, 2005. We encourage readers to consider the information
presented here in conjunction with additional information that we have furnished in our letter of
transmittal, which can be found on pages iii-vii of this report.
Financial Highlights
Below is a summary of the City's government-wide financial information (in thousands):
Total Governmental and Business Activities
Amount Percent f
September 30, September 3D, Increase Increase
2005 2004 Decrease Decrease (
Assets $ 936,629 $ 869,577 $ 67,052 7.7%
Liabilities 199,563 210,065 (10,502) -5.0%
Total Net Assets 737,066 659,512 77,554 11.6% f
Unrestricted Net Assets 81,789 24,386 57,403 235.4% l
Long-Perm Obligations 166,343 170,862 (4,519) -2.6%
Program Revenues 139,638 107,979 31,659 29.3%
Taxes 120,762 106,467 14,295 13.4%
Other General Revenues 34,030 26,347 7,683 29.2%
Expenses 216,876 209,560 7,316 3.5% F
• The total assets of the City of Huntington Beach exceeded its liabilities at the close of the
most recent fiscal year by$737,066,000, Of this amount, $81,789,000 may be used to meet C
the City's ongoing obligations to citizens and creditors. Net assets increased $77,554,000
(11.8%), while unrestricted net assets increased by $57,403,000 (235.4%).
• Long-term liabilities decreased by $4,519,000 (-2.6%)
• Program revenues increased $31,659,000 (29.3%). Taxes increased $14,295,000 (13.4%),
while other general revenues increased $7,683,000 (29.2%). Expenses increased
$7,316,000 (3.5%)
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Overview Of The Financial Statements
This discussion and analysis serve as an introduction to the City of Huntington Beach basicfinancial
statements. The City of Huntington Beach's basic financial statements comprise three components:
1)government-wide financial statements, 2)fund financial statements, and 3) notes to the financial
statements. This report also contains certain other supplementary information in addition to the
basic financial statements themselves.
Government-wide Financial Statements. The government-wide financial statements are C
designed to provide readers with a broad overview of the City's financial condition and are prepared
similarly to those in the private sector.
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, continued increases or decreases in
net assets may indicate whether the City's financial condition is improving or deteriorating.
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City of Huntington Beach
• 41, Managements Discussion and Analysis
For the Year Ended September 30, 2005
' The statement of activities presents information on how the City's net assets changed during the
most recent fiscal year. These changes are reported on the accrual basis (when the economic
• event occurs), not when the cash is received or paid.
' The government-wide financial statements separate functions that are primarily supported by taxes
• and intergovernmental revenues (governmental activities)from functions that are supported by user
• fees (business activities). Governmental activities include public safety, public works, general
government, and community-related activities. Business activities include the Water, Sewer,
Refuse, Emerald Cove Housing, Emergency Fire Medical, Hazmat Service, and Ocean View
Estates.
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The government-wide financial statements include the City and all of its component units that are
• legally separate but whose activities entirely support the City of Huntington Beach. These entities
are, the Redevelopment Agency of the City of Huntington Beach, the Huntington Beach Public
• Financing Authority, the Huntington Beach Civic Improvement Corporation, and various assessment
districts described in Note 2 to the financial statements.
The government-wide financial statements can be found on pages 14-15 of this report.
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Fund Financial Statements. The City separates financial activities into funds to maintain control
. over resources that have been legally separated. All of the funds of the City can be divided into
three categories: governmental funds, proprietary funds, and fiduciary funds.
•
Governmental Funds. Governmental funds are used to account for the same functions reported in
governmental activities in the government-wide financial statements. However, the focus in the
governmental fund section of these financial statements is on near-term resource inflows and
• outflows available for spending, as well as balances of resources available for spending at the end
• of the fiscal year.
It is useful to compare information presented for the governmental funds to information presented
• for governmental activities in the government-wide financial statements. The reconciliation
indicates to the reader the differences in financial reporting between the governmental activities
• section and the governmental funds section.
• The City maintains 20 individual governmental funds. Information is presented separately in the
• governmental fund balance sheet and in the governmental fund statement of revenue, expenditures,
• and changes in fund balances for the General Fund, Redevelopment Agency, Huntington Beach
Public Financing Authority, and Grants, all of which are considered to be major funds. Data from
• the other 16 funds are combined into a single, aggregated presentation. Individual fund data for
each of these nonmajor governmental funds is provided in a combining statement elsewhere in this
• report.
• The City provides an annual appropriated budget for its governmental funds. Budgetary
• comparison schedules on pages 69-71 demonstrate compliance.
•
•
4
•
•
City of Huntington Beach
Management's Discussion and Analysis
For the Year Ended September 30, 2005
The basic governmental fund financial statements can be found on pages 16 and 18-19 of this
report.
Proprietary Funds. Proprietary funds, or enterprise funds are used to account for the same
activities as the business-type activities in the government-wide financial statements. The City uses
enterprise funds to account for its Water, Sewer, Refuse, Emerald Cove Housing, Emergency Fire
Medical, Hazmat Service, and Ocean View Estates activities.
Proprietary funds provide the same type of information as the government-wide financial
statements, only in more detail. The proprietary fund financial statement provides information for
Water, Sewer Service, and Refuse Funds, which are considered to be major funds of the City. The
remaining proprietary funds noted above are combined into a single, aggregated presentation.
f
The basic proprietary fund financial statements can be found on pages 21-23 of this report.
Fiduciary funds. Fiduciary funds are used to account for resources held for the benefit of parties
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outside the government. Fiduciary funds are not reflected in the government-wide financial
statement because the resources of those funds are not available to support the City of Huntington
Beach's own programs. The accounting used for fiduciary funds is much like that used for
proprietary funds
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The basic fiduciary fund financial statements can be found on page 24 of this report.
Notes to the financial statements. The notes provide additional information that is essential to a {
full understanding of the data provided in the government-wide and fund financial statements. The
notes to the financial statements can be found on pages 25-67 of this report. f
Other information. In addition to the basic financial statements and accompanying notes, this report
also presents certain required supplementary information concerning the City's progress in funding
its obligation to provide pension benefits to its employees and General Fund budget to actual
comparisons. Required supplementary information can be found on pages 68-72 of this report.
The combining statements referred to earlier in connection with non-major government funds is
presented immediately following the required supplementary information on pensions. Combining
and individual fund statements and schedules can be found on pages 73-94 of this report. t
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_ City of Huntington Beach
• Management's Discussion and Analysis
For the Year Ended September 30, 2005
•
Government-Wide Financial Analysis
As noted earlier, net assets may serve over time as a useful indicator of a government's financial
• position. Below is a summary schedule of the City's net assets at September 30, 2005 (in
thousands):
• Amount Percent
• September 30, September 30, Increase Increase
Governmental Activities 2005 2004 (Decrease} (Decrease}
• Current and Other Assets $ 150,476 $ 126,313 $ 24,163 19.1%
Capital Assets 601,849 577,305 24,544 4.3%
Total Assets 752,325 703,618 48,707 23.4%
Current Liabilities 40,635 44,213 (3,578) -8.1%
. Long-Term Liabilities 152,341) 159,415 (7,075) -4.4%
Total Liabilities 192,975 203,628 10,653 A2.5%
Net Assets:
Invested in Capital Assets,Net of Related Debt 479,897 448,217 31,680 7.1%
Restricted 39,227 61,051 (21,824) -35.7%
Unrestricted 40,226 (9,278) 49,504 na
• Total Net Assets $ 559,350 $ 499,990 $ 59,360 11.9%
• ounPercent
• September 30, September 30, Increase Increase
Business Activities 2005 2004 (Decrease) (Decrease)
• Current and Other Assets $ 82,124 $ 72,886 $ 9,238 12.7%
Capital Assets 102,180 93,073 9,107 9.8%
• Total Assets 184,304 165,959 18,345 22.5%
' Current Liabilities 5,802 5,739 63 1.1%
Long-Term Obligations 786 698 88 na
i Total Liabilities 6,588 6,437 151 2.3%
Net Assets:
• Invested in Capital Assets,Net of Related Debt 102,068 92,890 9,178 9.9%
Restricted 34,085 32,968 1,117 3.4%
Unrestricted 41,563 33,664 7,899 23.5%
Total Net Assets $ 177,716 $ 169,522 $ 18,194 11.4%
The largest portion of the City's net assets reflects investment in capital assets (e.g., land, buildings,
machinery, equipment, and infrastructure), less any related debt used to acquire those assets that is
• still outstanding. The City uses capital assets to provide services to citizens; consequently, these
assets are not available for future spending. Although the City's investment in its capital assets is
reported net of related debt, the resources needed to repay this debt must be provided from other
sources, since capital assets themselves cannot be used to liquidate these liabilities. An additional
portion of the City's net assets is subject to external (legally imposed or statutory) restrictions
($39,227,000 for governmental activities, and $34,085,000 for business activities). These amounts
represent 7.0% and 19.1% of net assets for governmental activities and business activities
respectively. The unrestricted assets ($40,226,000 for governmental activities and $41,563,000 for
• business activities) represent 7.1% and 23.4% of net assets for governmental activities and
business activities respectively.
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• 6
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City of Huntington Beach
Management's Discussion and Analysis
For the Year Ended September 30, 2005
A condensed summary of governmental activities (in thousands) follows:
Governmental Activities
ountPercent (r
September 30, September 30, Increase Increase
Revenues: 2005 2004 Decrease Decrease
Program Revenues:
Charges for Current Services $ 28.808 $ 30,419 $ (1,611) -5.3%
Operating Grants and Contributions 1,657 6,343 (4,686) -73.9%
Capital Grants and Contributions 43,341 7,384 35,957 487.0%
Total Program Revenues 73,806 44.146 29,660 67.2%
General Revenues:
Properly Taxes 61,466 47,405 14,061 29.7% �s
Sales Taxes 24,340 28,273 (3,933) -13.9%
Utility Taxes 20,004 19,424 580 3.0%
Other Taxes 14,952 11,365 3,587 31.6%
Use of Money and Property 3,137 3,528 (391) -11.1%
From Other Agencies 8,186 14,406 (6,220) -43.2%
Participation Payments 12,697 12,697 na
Other 8,510 7,328 1,182 16.1%
Total General Revenues 153,292 131,729 21,563 16.4%
Total Revenues 227,098 175,875 51,223 29.1%
Expenses:
City Council 254 280 (26) -9.3%
City Administrator 1,990 1,188 802 67.5%
City Treasurer 1,568 1,541 27 1.8%
City Attorney 2,852 2,775 77 2.8%
City Clerk 685 717 (32) -4.5%
Administrative Services 5,554 6,348 (794) -12.5%
Finance 2,501 - 2,501 na
Planning 2,559 2,396 163 6.8%
Building 3,321 2,858 463 16.2%
Fire 23,365 20,000 3,365 16.8%
Information Systems 6,806 6,423 383 6.0% f
Police 47,029 40,686 6,343 15.6%
Economic Development 4,199 19,372 (15,173) -78.3%
Community Services 13,693 15,735 (2,042) -13.0%
Library Services 4,394 4,138 256 6,2% {
Public Works 33,018 30,277 2,741 9.1%
Non-Departmental 12,024 4,054 7,970 196.6%
Interest on Long-Term Debt 6,810 6,001 809 13.5%
Total Expenses 172,622 164,789 7,833 4.8%
Increase in Net Assets Before Transfers 54,476 11,086
Transfers 4,884 6,126
Net Assets-Beginning of Year 499,990 482,778
Net Assets-End of Year $ 559,350 $ 499,990
The cost of all governmental activities this year was $172,622,000. However, as shown in the C
Statement of Activities, the amount that the taxpayers ultimately financed for these activities was
only $98,816,000, because some of the cost was paid by those who directly benefited from the
programs ($28,808,000), or by other governments and organizations that subsidized certain
programs with operating grants and contributions($1,657,000), and capital grants and contributions
($43,341 ,000). Overall, the City's governmental program revenues were $73,806,000. The City
paid for the remaining "public benefit" portion of governmental activities with $1,523,292,000 in f
taxes and general revenue (some of which could only be used for certain programs) and with other
revenues, such as interest and general entitlements.
Total resources available during the year to finance governmental operations were $731,972,000,
consisting of net assets at October 1, 2004 of $499,990,000, program revenues of $73,806,000,
general revenues of$153,292,000, and transfers of$4,884,000. Total expenses for governmental
7
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•
• �"� City of Huntington Beach
• Management's Discussion and Analysis
• For the Year Ended September 30, 2005
• activities during the year were $172,622,000, thus, net assets were increased by $59,360,000, to
# $559,350,000.
•
A condensed summary of business activities (in thousands) follows:
Business Activities
Amount Percent
• September 30, September 30, Increase Increase
2005 1 2004 Decrease Decreasel.
• Program Revenues:
Charges for Current Services $ 51,803 $ 53,419 $ (1,616) -3.0%
• Capital Grants and Contributions 14,029 10,414 3,615 34.7%
Total Program Revenues 65,832 63,833 1,999 3.1%
• Use of Money and Property 1,500 1,085 415 38.2%
• Total Revenues 67,332 64,918 2,414 3.7%
Expenses:
Water Utility 22,349 24,643 (2,294) -9.3%
Emerald Cove Housing 399 409 (10) -2.4%
• Emergency Fire Medical 5,497 5,605 (108) -1.9%
Refuse Collection 9,826 9,806 20 0.2%
Sewer Service 5,924 4,042 1,882 46.6%
Hazmat Service 141 204 (63) -30.9%
. Ocean View Estates 118 62 56 90.3%
Total Expenses 44,254 44,771 (517) -1.2%
• Increase in Net Assets Before Transfers 23,078 20,147
Transfers (4,884) (6,126)
• Net Assets-Beginning of Year 159,522 145,501
Net Assets-End of Year $ 177,716 $ 159,522
•
` The City's net assets from business activities increased by $23,078,000 before transfers. The
largest reasons for this increase were developer contributions of infrastructure of$5,842,000, and
capital contributions for the Water Master Plan of$6,955,000.
•
• The cost of all Proprietary (Business Type) activities this year was $44,254,000. As shown in the
Statement of Activities and Changes in Net Assets, the amount paid by users of the systems was
$51,803,000, capital grants and contributions were $14,029,000, other revenue was $1,500,000,
and transfers were $4,884,000. Beginning net assets were $159,522,000 and ending net assets
were $177,716,000. Of the ending net asset amount, $102,068,000, or 57.4%, was invested in
capital assets, $34,085,000 or 19.2%was restricted for expenditures for the Water Master Plan, and
• $41,563,000, or 23.4% was unrestricted.
•
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City of Huntington Beach
Management's Discussion and Analysis
For the Year Ended September 30, 2005
f
The City's programs for governmental activities include General Government, Fire, Police, Public
Works, Redevelopment, Community Services and Library. Business type activities include the
Water, Sewer, Refuse, FireMed, Hazmat Service, and Ocean View Estates. A listing of each
program's revenues and expenses for the current year is presented below (in thousands):
2004-2005 2003-2004
un e y un e y
Taxes and Other Taxes and
Less Program General Other General
Governmental Activities: Expenses Revenues Revenues Revenues
City Council $ 254 $ $ 254 $ 280
City Administrator 1,990 1,990 1,142
City Treasurer 1,568 1,568 1,541
City Attorney 2,852 2,852 2,775
City Clerk 685 (111) 574 717
Administrative Services 5,554 5,554 6,348
Finance 2,501 2,501 na
Planning 2,559 (1,024) 1,535 993
Building 3,321 (5,068) (1,747) (1,655)
Fire 23,365 (1,843) 21,522 18,570
Information Systems 6,806 6,806 6,423
Police 47,029 (5,755) 41,274 35,323
Economic Development 4,199 (2,011) 2,188 15,840
Community Services 13,693 (14,411) (718) 896
Library Services 4,394 (979) 3,415 2,887
Public Works 33,018 (42,604) (9,586) 20,707
Non-Departmental 12,024 12,024 1,855
Interest on Long-Term Debt 6,810 6,810 6,000
Total Governmental Activities $ 172,622 $ 73,806 $ 98,816 $ 120,642
Business Activities
Water Utility 22,349 (40,371) (18,022) (15,529)
Emerald Cove Housing 399 (866) (467) (371)
Emergency Fire Medical 5,497 (5,725) (228) (45)
Refuse Collection 9,826 (9,985) (159) (606)
Sewer Service 5,924 (8,512) (2,588) (2,332)
Hazmat Service 141 (110) 31 17
Ocean View Estates 118 (263) (145) _ (196)
Total Business Activities $ 44,254 $ 65,832 $ 21,578 $ 19,062
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Financial Analysis Of The City's Governmental Funds
Below is an analysis of the City's governmental fund activities for the year (in thousands): f
(
GOVERNMENTAL FUNDS
Amount Percent
September 30, September 30, Increase Increase
2005 2004 Decrease Decrease
Total Fund Equity: {
General Fund $ 38,286 $ 26,332 $ 11,954 45.4%
Redevelopment Agency 29,107 14,130 14,977 na
Public Financing Authority 7,158 7,509 (351) -4.7%
Grants 4,283 5,115 (832) -16.3%
Other Governmental Funds 33,479 29,875 3,604 12.1%
Total Fund Equity $ 112,313 $ 82,961 $ 29,362 35.4%
Unreserved Fund Equity: {
General Fund $ 32,371 24,219 $ 8,152 33.7%
Other Governmental Funds 38,569 26,486 12,083 45.6%
Total Unreserved Fund Equity $ 70,940 $ 50,705 $ 20,235 79.3%
9 (
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�~ City of Huntington Beach
Management's Discussion and Analysis
For the Year Ended September 30, 2005
•
• As of the close of the current fiscal year, the City's governmental fund balances reported
• combined ending balance of$112,313,000, an increase of$29,352 or 35.4%, in comparison
• to the prior year.
The total fund balance at year-end for the City's General fund was $38,286,000, which is an
• overall increase of$11,954,000, or 45.4% over last year. The unreserved fund balance was
$32,371,000 or 22.8% of General Fund expenditures.
Financial Analysis of the City's Proprietary Funds
• Below is an analysis of the fund equity of the City's proprietary funds (in thousands):
•
• Enterprise Funds
• Amount Percent
. September 30, September 30, Increase Increase
2005 2004 Decrease Decrease
• Net Assets:
Water Fund $ 128,055 $ 113,915 $ 14,140 12.4%
Sewer Fund 35,648 32,826 2,822 8.6%
• Refuse Fund 18 (284) 302 -106.3%
• other Enterprise Funds 13,995 13,065 930 7.1%
Total Net Assets $ 177,716 $ 159,522 $ 18,194 11.4%
• Unrestricted Net Assets:
• Water Fund $ 22,900 $ 18,776 $ 4,124 22.0%
Sewer Fund 12,285 9,877 2,408 24.4%
• Refuse Fund 18 (284) 302 -106.3%
Other Enterprise Funds 6,360 5,295 1,065 20.1%
• Total Unrestricted Net Assets $ 41,563 $ 33,664 $ 7,899 23.5%
• • Total net assets of the Water Fund increased $14,140,000 (12.4%), while unrestricted net
assets increased $4,124,000 (22.0%).
• Total net assets of the Sewer Fund increased $2,822,000 (8.6%) while unrestricted net
assets increased by $2,408,000 (24.4%). The increase in total assets is largely due to
additional contributed infrastructure. The increase in net assets is due to funds being
. accumulated to pay for future capital improvements.
w • The unrestricted net assets of the Refuse Fund increased by$302,000 from a deficit balance
of ($284,000) to $18,000.
■ Total net assets of non-major enterprise funds increased $930,000(7.1%)while unrestricted
net assets increased $1,065,000 (20.1%).
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City of Huntington Beach
Management's Discussion and Analysis
N For the Year Ended September 30, 2005
Debt Administration
Below is a schedule of the changes to the City's long-term debt (in thousands).
Balance
Balance September 30,
Governmental Activities: October 1,2004 Additions Retirements t 2005
Certificates of Participation $ 16,140 $ $ (615) $ 15,525
Revenue Bonds 60,840 (2,810) 58,030
Tax Allocation Bonds 28,305 (1,100) 27,205
Judgement Obigation Bonds 12,500 (255) 12,245
Claims 11,937 6,092 (3,484) 14,545
Compensated Absences 8,037 3,161 (2,153) 9,045
Pension Obligation 8,409 999 (1,768) 7,640
Loans 18,917 655 (1,823) 17,749
Leases Payable 4,885 447 (1,871) 3,461
Total Long-Term Obligations-Governmental
Activities 169,970 11,354 (15,879) 165,445
Business Activities:
Compensated Absences 710 201 (125) 786
Leases 183 - (71) 112
Total Long-Term Obligations-Business
Activities 893 201 (196) 898
Total Long-Term Obligations $_ 170,863 $ 11,555 $ (16,075) $ 166,343
Additional information on the City's long-term debt is shown in note 10 to the financial statements.
The City of Huntington Beach is legally restricted to issuing general obligation bonds to 15% of its
assessed valuation. Since the City has no general obligation bonds outstanding, the limit does not
apply. This is shown on page 104 of the financial statements. The City's total debt for decreased
$4,520,000 or 2.6% from its beginning amount primarily due to debt repayment.
The City continues to maintain excellent credit ratings on all of its debt issues. The following are the
latest ratings as determined by Moody's Investors Service and Standard and Poor's.
Debt Instrument Moody's S & P
1998 Tax Allocation Refunding Bonds Aaa AAA
2000 Lease Revenue Bands, Series A Aaa AAA
2001 Lease Revenue Bonds, Series A Aaa AAA
2001 Lease Revenue Bonds, Series B Aaa AAA
2002 Tax Allocation Refunding Bonds Aaa AAA
2004 Judgment Obligation Bonds Aa3 AAA
Housing Set-Aside Tax Allocation Aaa Not Available
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11
City of Huntington Beach
• 4 ' ' Management's Discussion and Analysis
• For the Year Ended September 30, 2005
•
• Capital Assets
The capital assets of the City are those assets, which are used in the performance of the City's
• functions including infrastructure assets. The City has elected to use the "Basic Approach" as
• defined by GASB statement 34 for infrastructure reporting. The following infrastructure networks
• are recorded as capital assets in the government-wide financial statements:
• • Storm drain system including pump stations, drainage system and manholes.
• Streets, (including land underneath streets) traffic signals, curbs, gutters, and sidewalks.
• Below is a schedule of the City's capital assets, net of accumulated depreciation (in thousands):
•
ount ercent
September 30, September 30, Increase Increase
• Governmental Activities: 2005 2004 Decrease Decrease]
Land $ 334,636 $ 323,714 $ 10,922 3.4%
. Buildings 99,580 88,815 10,765 12.1%
Machinery and Equipment 18,445 16,816 1,629 9.7%
• Construction in Progress 12,992 (12,992) -10Q0%
Joint Venture 1,321 1,339 (18) -1.3%
• Infrastructure 147,867 133,629 14,238 10.7%
Total Governmental Activities 601,849 577,305 24,544 4.3%
• Business Activities:
Land $ 7,840 $ 7,840 $ - 0.0%
• Buildings 39,412 30,401 9,011 29.6%
Machinery and Equipment 6,188 6,440 (252) -3.9%
• Construction in Progress - 8,070 (8,070) -100.0%
Infrastructure 48,740 40,322 8,418 20.9%
Total Business Activities 102,180 93,073_ 9,107 9.8%
Total Capital Assets $ 704,029 $ 670,378 $ 33,651 5.0%
•
Capital assets from governmental activities increased $24,544,000 (4.3%)while capital assets from
business activities increased $9,107,000(9.8%). These increases were largely due to infrastructure
• additions. Further information on the City's capital assets can be found in note 11 of the financial
• statements.
• General Fund Budgetary Highlights
• Comparing the fiscal year 2004/2005 original budget (or adopted) General Fund (expenditures and
• transfers) amount of $162,329,000 to the final budgeted amount of $161,157,000 shows a net
• decrease of $1,172,000. Included in original budget amount is $2,113,000 of prior year
encumbrance carryover into fiscal year 2004/2005. The net decrease is primarily due to cancelled
• encumbrances from the prior year.
•
• General Fund expenditures were $12,358,000 less than the final budget. The favorable budget
variance is primarily due to lower than expected expenditures.
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• 12
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City of Huntington Beach
Management's Discussion and Analysis
For the Year Ended September 30, 2005
Economic Factors And Next Year's Budgets And Rates
The key assumptions in the General Fund revenue forecast for fiscal year 2005/2006 are:
• Stabilization of local revenues due to recently passed statewide legislation and court
decisions
Modest, consistent general economic growth with emphasis on improving the sales tax and t`
9 9 p p g
transient occupancy tax base
• Strong growth in property tax revenues
• Establish and maintain proper cost allocations to enterprise funds
• Maintain appropriate fee schedules for allowable cost recovery.
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Contacting the City's Financial Management
This financial report is designed to provide our citizens, taxpayers, customers, investors, and
creditors with a general overview of the City's finances and to show the City's accountability for the
money it receives. If you have questions about this report, separate reports of the City's component
units or need any additional financial information, contact the Finance Department at 2000 Main
Street, Huntington Beach, California, 92648, phone (714) 536-5360 or e-mail cgonzales(W-surFcity-
hb.or . You can also visit the City's website at www.surfcity-hb.org for additional copies of this
report.
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CITY OF HUNIINGTON BEACH l
STATEMENT OF NET ASSETS
SEPTEMBER 30,2005
(In Thousands)
Governmental Business-Type
ASSETS: Activities Activities Total
Cash and Investments $ 22,209 $ 39,957 $ 62,166
Receivables 26,852 6,999 33,851
Inventories - 1,207 1,207
Other Assets 13,124 - 13,124
Subtotal 62,185 48,163 110,348
Restricted Assets:
Cash and Investments 58,075 33,961 92,036 {
Cash with Fiscal Agent 12,244 - 12,244 f
Receivables 15,137 - 15,137
Land Held for Resale 2,835 - 2,835
Total Restricted Assets 88,291 33,961 122,252
Capital Assets:
Non-Depreciable 335,957 7,940 343,797
Depreciable 265,892 94,340 360,232
Total Capital Assets 601,849 102,180 704,029 {
TOTAL ASSETS 752,325 184,304 936,629
LIABILITIES:
Accounts Payable 3,116 3,327 6,443
Accrued Payroll 2,297 201 2,498
Deposits 1,834 2,162 3,996
Claims Payable 5,944 - 5,944
Subtotal 13,191 5,690 18,881
Liabilities Payable from Restricted Assets:
Accounts Payable 1,444 - 1,444 f
Accrued Interest Payable 1,572 1,572
Deferred Revenue 8,379 8,379
Deposits 2,944 - 2,944
Total Liabilities Payable from Restricted Assets 14,339 - 14,340
Long-Term Obligations:
Current liabilities Payable from Restricted Assets {
Long-Term Obligations Due Within One Year 13,105 112 13,217
Long-Term Obligations Due in More than One Year 152,340 786 153,126
Total Long-Term Obligations 165,445 898 166,343 {
TOTAL LIABILITIES 192,975 6,588 199,563
NET ASSETS:
Investment in Capital Assets,Net of Related Debt 479,897 102,063 581,965
Restricted for. {
Debt Service 10,993 - 10,993
Capital Projects 16,428 - 16,428
Other Purposes 11,806 34,085 45,891 {
Total Restricted Net Assets 39,227 34,085 73,312
Unrestricted 40,226 41,563 81,789 {
TOTAL NET ASSETS $ 559,350 $ 177,716 $ 737,066 {
{
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{
See independent auditors'report and notes to the financial statements 14
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CITY OF HUNTINGTON BEAK,
STATEMENT OF ACTIVITIES AND CHANGES IN NET ASSETS
FOR THE YEAR ENDED SEP'TEMBER 30,2005
• (In Thousands)
. Changes in Net
Program Revernres Assets
Chargesfor Operating Capital Grants Business
current Grants and and Goverrimental Type
Expenses Services Corrtributions Cordributions Activities Activities Tatat
• FunctionsfPrograms
Goverrarental Activities:
City Council $ 254 $ $ $ - $ (254) $ $ (254)
. atyAdministrator 1,990 (11990) _ (11990)
City Treasurer 1,568 (1,568) (1,568)
• CltyAttomey 2,852 (2,852) (2,852)
City Clerk 685 111 (574) (574)
AcirniristratirveServices 5,554 - (5,554) (5,554)
• Finance 2,501 (2,501) (2,501)
Planning 2,559 1,024 (1,535) (1,535)
E luilding 3,321 5,068 1,747 1,747
. Fire 23,365 1,095 748 (21,522) (21,522)
Information Systems 6,806 - - (61806) (6,806)
. Police 47,029 5,254 501 (41,274) (41,274)
ixenomicDe'velopment 4,199 385 - 1,626 (2,188) - (2,188)
Community Services 13,693 13,376 130 905 718 718
• Library Services 4,394 714 265 - (3,415) (3,415)
Public Works 33,018 1,781 13 40,810 9,586 - 9,586
Non-Departmental 12,024 - - - (12,024) (12,024)
• Interest on Long-Term Debt 6,810 - - - (6,810) (6,810)
Total Governmental Activities 172,622 28,808 1,657 43,341 (98,816) (98,816)
• Business4ype Activities:
• Water Utility 22,349 27,574 - 12,797 = 18,022 18,022
Sew Service 5,924 7,280 - 1,232 2588 2,588
i Refuse Collection 9,826 9,%5 - - - 159 159
Emerald Cove Housing 399 866 - - - • 467 467
Emergency Fire Medical 5,497 5,725 - - - 228 228
• Hamv t Service 141 110 - - - (31) (31)
Ocean Uevv Estates 118 263 - - - 145 145
Total 6usiness Type Actkmties 44,254 51,803 - 14,029 - 21,578 21,578
• Total Business and Government Type
Activities $ 216,876 $ 80,611 $ 1,657 $ 57,370 (98,816) 21,578 (77,238)
General Revenues:
. Taxes:
Property Taxes 61,466 - 61,466
Sales Taxes 24,340 24,340
. Utility Taxes 20,004 20,004
Other Taxes 14,952 14,952
Total Taxes 120,762 - 120,762
• Other General Revenue:
Use of Money and Property 3,137 1,500 4,637
From Other Agencies 6,186 - 8,186
. Partiapatien Payments 12,697 - 12,697
Curer 8,510 - 8,510
. ToW Other General Revenue 3ZS30 1,500 34,030
Transfers 4,884 (4,884) -
Total General Revernres and Transfers 158,176 (3,384) 154,792
. Change in Net Assets 59,360 18,194 77,W4
Net Assets-Beginning of Year 499,990 159,522 659,512
S Net Assets-End of Year $ 559,350 $ 177,716 $ 737,066
e See independent auditors'report and notes to the financial statements 15
aTY a`Hu nNGToN BEAOH
BALANCE SFEET f
GOVO MNENPAL FLI DS
SEPTEMBER 30,2005
On Thousands)
Other M4or Goverrnnren W Funds
RU"ff
Ger" Rede-Mopnnerd Public Financing Gonwnffw al Goverrtr>enfal
ASSETS: Fund Nm I Authoft Cards Funds Funds Total
Gash and Invesh n rls $ 22,C29 $ 22,208 $ - $ 3,786 $ 48,003 $ 32,281 $ 80284
Cash and Irrves[�with Fiscal Agent 239 Z457 7,072 - 9,768 Z476 12,244
Taxes Receivable 22,735 2,272 - - 25,097 - 25,007
Other Receivables 4,12} 6,842 88 4,423 15,473 1509 16,982
Due from Gther Funds - - - - - 863 863
Advances toOtlierFunds 1,835 1,836 - 1,836
Lard Hold for Resale - Z835 2,835 - 2,035
COww Assets - 1,294 1,294
Prepaid Experses 11,830 - - - 11,830 - 11,830
TOTALASSETS $ 789 614 7,160 8,189 114,752 38AM $ 153,175 6Z 36, l
UA13 LITIES AND FLW BALANCES
LIABILITIES
(TIES
AcoourAs Payable $ 3,116 $ 70 $ 2 $ 455 $ 3,643 $ 917 $ 4,560
Accrued Payroll Z245 3 - 15 2233 34 Z297
Due to Other Funds - - - 863 863
Advances ft n Oder Funds - - - 1,836 1,836
Deposits Payable 1,834 1,650 - 3,484 1,294 4,778
Deferred Revenue 11,364 5,784 3,436 2D,584 - 20,584
Claims Payable 5,944 - - 5,944 - 5,944
TOTALUABlunES A503 7,507 2 3,906 35,918 4,944 40,862
FUND BALANCES
Reserved for:
Erncuntrar>ces 4,079 79 - 615 4,773 10,754 15,527
Lon g-TerrnRacmables 1,835 1,247 - - 3,083 - 3,083
Debt Service Reds - - 7,159 7,158 7,158
Capital Projects 12,770 - 12,770 12,770 rr
Land Held for Resale - Z835 - - Z835 ZM5
Total Reserved Fund Balance 5,915 16,931 7158 615 30 619 10,754 41,373 1
Unreserved,Designated:
Dedgnated far Future Experdture f
(Reported in): 2,995 12,176 - 3,MB 18,839 - 18,839
Special RB%wm Funds - - - 9,845 9,845
Debt Serwoe Funds 81 81
Capital Projects Funds - - 153 153
Ottner Designations:
Eqr M-tReplacen>ent 4,297 4,207 - 4,287
Capital Projects 6,121 - 6,121 6,121
Second Tier 3,532 3,532 3,532
Eoonomc Uncertainties 11,469 11,469 11,469
Unreserved,lhdesigrated(Deported in): f
General Frond 3,967 3,967 3,967
Spedal Revenue Fund - - 7,988 7,988
Debt Service Funds - 3,835 3,835
Capital Projects Funds - - - 823
Total Unreserved 32,371 12,176 3,668 48,215 4725 70,940
TOTAL FLInD BALANCES 4286 29,107 7,158 _�4_283 78,834_ 33,479 112,313
TOTAL LIABILIIFS AND FLM
BALANCES $ 62,789 $ 36,614 $ 7,160 $ 8,189 $ 114,752 $ 384M $ 14175
f
(
f
(
See independent auditors'report and notes to the financial statements 16
•
•
•
• CITY OF HUNTINGTON BEACH
RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS TO THE
STATEMENT OF NET ASSETS
SEPTEMBER 30, 2005
. (In Thousands)
•
Amounts reported for governmental activities in the statement of net
. assets are different because:
Total Fund Balances Governmental Funds $ 112,313
•
• 'Net capital assets used in governmental activities are not financial resources
and,therefore, are not reported in the funds 601,849
•
• Other long-term assets are not available to pay for current-period
• expenditures and, therefore, are deferred in the funds 12,205
• Accrued Interest Payable not Recorded in Liabilities (1,572)
• Long-term Liabilities, including bonds and certificates of participation payable
• are due and payable and therefore are not reported in the funds. (165,445)
• Net Assets of Governmental Activities $ 559,350
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• See independent auditors'report and notes to the financial statements 17
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H
Fss
E8 c r
ro
�Ff fd rs n r os n n � cv ors cv ors
0
MAIN 1 8 �
ro
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• '� i
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• Total Major Other Graver ntal
. G7m mental Funk Funds Total
$ 59,716 $ - $ 59,716
. 22,122 2,218 24,340
. 20,004 - 20,004
13,068 13,068
. 7,432 25 7,457
4,365 4,365
• 11,540 1,193 12,733
15,415 4,764 20,179
• 7,419 3,951 11,370
21,657 923 22,580
• 182,738 13,074 195,812
•
• 254 - 254
1,582 335 1,917
. 1,547 - 1,547
2,848 2,848
679 _ 679
5,731 5,731
2,501 2,501
. 2,548 2 548
3,291 3,291
i 22`365 22'�
5,726 - 5,726
• 45,713 65 45,778
2,856 2,866
• 11,352 969 12,321
2,851 1,118 3,969
• 19,293 2,242 21,535
12,927 112 13,039
4,862 4,203 9,065
• 8,180 294 8,474
• 5,569 430 5,999
162,685 9,768 172453_
• 20,053 3,306 23,359
• 18,617 2,273 20,890
1,102 - 1,102
• (14,031) (1,975) (16,006)
• 5 688 298 986
25,741 3,604 29,345
. 53,093 29,875 82,968
$ 78,834 $ 33,479 $ 112,313
•
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• See independent auditors'report and notes to the financial statements 19
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i
i
CITY OF HUNTINGTON BEACH
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED SEPTEMBER 30, 2005
(In Thousands)
Net Changes in Fund Balances-Total Governmental funds $ 29,345
Amounts reported for governmental activities in the Statement of Activities are
different because:
CAPITAL EXPENDITURES -Governmental funds report capital outlays as expenditures.
However, in the Statement of Activities, the cost of these assets is allocated over their
estimated useful lives and reported as depreciation expense. 1,880
DONATED ASSETS-Infrastructure and other capital assets donated from developers and
other sources that increased the City's capital assets. 33,469
DEPRECIATION EXPENSE-Depreciation is not reported in the governmental funds.
However, it is recorded in the Statement of Activities. (9,747)
ACCRUAL OF REVENUES- Certain revenues in the Statement of Activities do not meet
the "availability' criteria for revenue recognition in the governmental funds and are not
reported in the governmental funds as revenue. 1,750
LIABILITIES NOT LIQUIDATED WITH CURRENT RESOURCES-Some expenses
reported in the statement of activities do not require the use of current financial resources
and, therefore, are not reputed as expenditures in governmental funds. (4,709)
LONG-TERM DEBT PROCEEDS-Issuances and changes in long-term debt(bonds,
leases, certificates of participation, compensated absences, etc)provide current financial
resources to governmental funds, while repayments of this debt consumes the current
financial resources of governmental funds. These transactions, however, have no effect
on net assets. Also, governmental funds report the effect of issuance costs, premiums,
discounts, etc.when debt is first issued. These amounts are deferred and amortized in tha
Statement of Activities. (1,102)
PAYMENTS OF LONG-TERM DEBT- Principal payments on long-term debt are recorded
an expenditure in the governmental funds and a reduction of liability in the government-
wide statements. 8,474
Change in Net Assets of Governmental Activities $ 59,360
See independent auditors'report and notes to the rinancial statements 20
CITY OF HUNTINGTON BEACH
STATEMENT OF NET ASSETS
PROPRIETARY FUNDS
SEPTEMBER 30,2005
(In Thousands)
Sewer Total Major Non-Major
Service Refuse Enterprise Enterprise
ASSETS Water Fund Fund Fund Funds Funds Total
• Current Assets:
Cash and Investments $ 22,186 $ 12,171 $ $ 34,357 $ 5,600 $ 39,957
Restricted Cash 33,961 - 33,961 - 33,961
. Other Receivables 2,512 474 606 3,592 1,213 4,805
Inventories 1,207 - - 1,207 - 1,207
Unbilled Receivable 1,513 260 421 2,194 2,194
Due from Other Funds 211 - - 211 - 211
Total Current Assets 61,590 12,905 1,027 75,522 6,813 82,335
. Capital Assets:
Land 3,907 - - 3,907 3,933 7,840
Buildings and Improvements 39,743 3,708 43,451 4,662 48,113
. Machinery and Equipment 8,862 218 9,080 1,154 10,234
Infrastructure 61,589 38,651 100,240 - 100,240
S Less Accumulated Depreciation (42,919) (19,214) - (62,133) (2,114) (64,247)
Total Capital Assets 71,182 23,363 - 94,545 7,635 102,180
TOTAL ASSETS 132,772 36,268 1,027 170,067 14,448 184,515
• LIABILITIES
. Current Liabilities:
Accounts Payable 1,891 406 796 3,093 234 3,327
. Accrued Payroll 115 30 - 145 56 201
Due to Other Funds - - 211 211 - 211
Deposits Payable 2,091 - 2 2,093 59 2,162
S Current Portion of Compensated Absences 105 38 - 143 19 162
Current Portion of Claims and Leases 112 - - 112 - 112
Total Current Liabilities 4,314 474 1,009 5,797 378 6,175
Liabilities Payable from Restricted Assets
Non-Current Liabilities:
• Compensated Absences 403 146 - 549 75 624
Capital Leases 112 - - 112 - 112
Less Current Portion of Claims and Leases (112) - - (112) - (112)
Total Non-Current Liabilities 403 146 - 549 75 624
TOTAL LIABILITIES 4,717 620 1,009 6,346 453 6,799
NET ASSETS
• Invested in Capital Assets, Net of Related Debt 71,070 23,363 - 94,433 7,635 102,068
Restricted for:
. Other Purposes 34,085 - 34,085 - 34,085
• Unrestricted 22,900 12,285 18 35,203 6,360 41,563
TOTAL NET ASSETS $ 128,055 $ 35,648 $ 18 $ 163,721 $ 13,995 $ 177,716
See independent auditors'report and notes to the financial statements 21
0
f
CITY OF HUNTINGTON BEACH
STATEMENTOF REVENUES,EXPENSES,AND CHANGES IN NET ASSETS
PROPRIETARY FUNDS
FOR THE FISCAL YEAR ENDED SEPTEM13ER 30,2005
(In Thousands)
Total Major Non-Major
Sewer Service Enterprise Enterprise
Water Fund Fund Refuse Fund Funds Funds Total
OPERATING REVENUES:
Sales $ 27,574 $ - $ - $ 27,574 $ - $ 27,574
Rentals - - 1,129 1,129
Fees for Service 6,335 9,941 16,275 5,835 22,111
Other - 945 44 969 - 989
TOTAL OPERATING REVENUES 27,574 7,280 9,985 44,839 6,964 51,W3
OPERATING EXPENSES:
Water Purchases 8,684 8,684 8,684
Supplies and Operations 4,445 5,126 9,826 19,397 5,844 25,241
Engineering 1,300 - - 1,300 - 1,300
Production and Distribution 4,715 - 4,715 4,715
Water Meters 1,128 - 1,128 1,128
Water Quality 295 - - 295 295
Depreciation 1,782 798 - 2,580 311 2,891
TOTAL OPERATING EXPENSES 22,349 5,924 %826 38,099 6,155 44,254
OPERATING INCOME(LOSS) 5,225 1,356 159 6,740 809 7,549
NON-OPERATING REVENUES(EXPENSES):
Interest Income 1,157 234 - 1,391 109 1,500
Capital Improvement Fees 6,955 - 6,955 - 6,955
TOTAL NON-OPERATING REVENUES(EXPENSES) 8,112 234 - 8,346 109 8,455
CHANGE IN NET ASSETS BEFORE TRANSFERS AND
CAPITAL CONTRIBUTIONS: 13,337 1,590 159 15,086 918 16,004
TRANSFERS AND CAPITAL CONTRIBUTIONS:
Transfers In - - 143 143 489 632
Transfers Out (5,039) - - (5,039) (477) (5,516)
Capital Contributions 5,842 1,232 - 7,074 - 7,074
TOTAL TRANSFERS AND CAPITAL CONTRIBUTIONS 803 1,232 143 Z178 12 2,190
TOTAL CHANGE IN NET ASSETS 14,140 2,822 302 17,264 930 18,194
NET ASSETS-BEGINNING OF YEAR 113,915 32,826 (284) 146,457 13,065 159,522
NET ASSETS-END OF YEAR $ 128,055 $ 35,648 $ 18 $ 163,721 $ 13,995 $ 177,716
See independent auditors'report and notes to the financial statements 22
CITY OF HUNTNGTON BEACH
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
FOR THE.FISCAL YEAR ENDED SEPTEMBER 30,2005
(In Thousands)
• Total Major Non-Major
Sewer Service Enterprise Enterprise
Water Fund Fund Refuse Fund Funds Funds Total
• Cash Flows from Operating Activities:
Cash Received from Customers and Users $ 28,145 $ 7,213 $ 9,947 $ 45,305 $ 7,150 $ 52,455
Cash Paid to Employees for Services (4,954) (1,482) (89) (6,525) (2,943) (9,468)
Cash Paid to Suppliers of Goods and Services (15,108) (3,705) (10,001) (28,814) (2,738) (31,552)
Net Cash Provided(Used)by Operating Items 8,083 2,026 (143) 9,966 1,469 11,435
' Cash Flows from Noncapital Financing Activities:
i Transfers In - - 143 143 489 632
Transfers Out (5,039) - (5,039) (477) (5,516)
Net Cash Provided(Used)by Non Capital Financing
Activities (5,039) - 143 (4,896) 12 (4,884)
` Cash Flows from Capital and Related Financing Activities:
Purchase of Plant, Property,and Equipment (4,952) - - (4,952) (235) (5,187)
Capital Surcharge 6,955 - 5,955 - 6,955
Net Cash Provided(Used)by Capital and Related
• Financing Activities 2,003 - - 2,003 (235) 1,768
• Cash Flows from investing Activities
Cash Received from Investments 1,157 234 - 1,391 109 1,500
• Net Increase in Cash and Cash Equivalents 6,204 2,260 - 8,464 1,355 9,819
Cash and Cash Equivalents,Beginning of Year 49,943 9,911 - 59,854 4,245 64,099
Cash and Cash Equivalents,End of Year $ 56,147 $ 12,171 $ - $ 68,318 $ 5,600 $ 73,918
Reconciliation of Operating Income to Net Cash Provided
• (used)by Operating Activities
Operating Income(Loss) $ 5,225 $ 1,356 $ 159 $ 6,740 $ 809 $ 7,549
• Adjustments to Reconcile Operating income to Net Cash
Provided(Used)by Operating Activities
• Depreciation 1,782 798 - 2,580 311 2,891
Decrease(Increase)in Accounts Receivable 648 (71) (12) 565 226 791
Decrease(Increase)in Unbilled Receivables (77) 4 (26) (99) - (99)
• Decrease(increase)in Due from Other Funds 284 - - 284 284
• Decrease(Increase)in Inventory (50) - - (50) (50)
Increase(Decrease)in Accounts Payable (382) (83) 21 (444) 111 (333)
• increase(Decrease)in Accrued Payroll 40 7 (3) 44 10 54
Increase(Decrease)in Due to Other Funds - - (284) (284) - (284)
t♦ Increase(Decrease)in Claims Payable 112 - 112 - 112
! Increase(Decrease)in Deposits 422 - 2 424 19 443
Increase(Decrease)in Compensated Absences 79 15 - 94 (17) 77
• Net Cash Provided(Used)by Operating Activities $ 8,083 $ 2,026 $ (143) $ 9,966 $ 1,469 $ 11,435
! Noncash Investing,Capital,and Financing Activities:
Contributions of Infrastructure $ 5,842 $ 1,232 $ - $ 7,074 $ - $ 7,074
r
i
•
See independent auditors'report and notes to the financial statements 23
•
CITY OF HUNTINGTON BEACH
STATEMENT OF FIDUCIARY FUND NET ASSETS
FIDUCIARY FUNDS
SEPTEMBER 30, 2005 L
(In Thousands)
Trust Fund-
Total Agency Retirement
Assets: Funds Supplemental Fund
Cash and Investments- Local Agency Investment Fund $ 9,533 $ 14,039
Cash with Fiscal Agent 8,318 -
Accounts Receivable, Net 469 188
Total Assets $ 18,320 $ 14,227 fi
Liabilities:
Accounts Payable $ 6 $ 150
Due to Bondholders 9,670 -
Held for Others 8,644 -
Net PensionlBenefit Obligation - 7,640
Total Liabilities 18,320 7,790
Net Assets - 6,437
Total Liabilities and Net Assets $ 18,320 $ 14,227
CITY OF HUNTINGTON BEACH
STATEMENT OF CHANGES IN FIDUCIARY FUND NET ASSETS
TRUSTFUNDS
FOR THE YEAR ENDED SEPTEMBER 30, 2005
(In Thousands)
Trust Fund-
Retirement
Additions: Supplemental Fund
Employer Contributions $ 3,675
Other Income 769
Interest Income 234
Total Additions $ 4,678
Deductions:
f
Benefits 1,768
Total Deductions 1,768
Change in Net Assets 2,910
Net Assets- Beginning of Year 3,527
Net Assets-End of Year $ 6,437
(
See independent auditors'report and notes to the financial statements 24
• NOTES TO FINANCIAL STATEMENTS
•
Footnote
• Number Description Page
•
• 1. Summary of Significant Accounting Policies...... ........ ................ .................. .............25-33
2. Cash and Investments ..................................................................................................34-35
3. Deferred Compensation.....................................................................................................35
• 4. Deferred Revenue..............................................................................................................36
5. Retirement Plan — Normal.............................................................................................36-38
6. Retirement Plan — Supplemental ..................................................................................38-40
• 7. Post-Employment Medical Insurance........:...................................................................40-41
8. Risk Management.........................................................................................................42-43
i 9. Interfund Transactions ..................................................................................................44-45
10. Long-term Debt Obligations..........................................................................................46-61
11. Capital Assets...............................................................................................................62-64
• 12. Commitments and Contingencies .................................................................................64-66
13. Other Information ...............................................................................................................67
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00 City of Huntington Beach
r ,'. Notes to Financial Statements
- „s, For the Year Ended September 30, 2006
C
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Reporting Entity t
fi
The City of Huntington Beach is the primary government. It was incorporated in 1909, is a
charter, full-service city. The form of government is Council-Manager. Component units
are legally separate organizations for which the City Council is financially accountable, or
organizations that if excluded from the accompanying financial statements, would make
them misleading. The component units described below are blended (presented as if they
are part of the primary government) with the primary government for financial reporting
purposes because either the component units have governing bodies identical to the
City's (the City Council) or provide services exclusively to the City. Financial
accountability means the appointment of a voting majority of the component unit's board
and either the ability to impose will by the City or the possibility that the component unit
will provide a financial benefit or impose a financial burden on the City.
• Redevelopment A-gency of the City of Huntington Beach (the Redevelopment
Agency)—This entity was formed in 1967 to renovate older areas in the City. The City
Council serves as its governing body and adopts its annual budget. The
Redevelopment Agency is financially dependent on the City for all of its operations.
Separately prepared financial statements are available for the Redevelopment Agency
from the City's Finance Department. f
• Huntington Beach Public Financing Authority (Public Financing Authority)—This t
Corporation was formed in March 1988 to issue debt to finance public improvements
and other capital purchases for the City and Redevelopment Agency. The Public
Financing Authority's governing body is the City Council,which also adopts the annual t
budget. The Public Financing Authority is financially dependent on the City. E
• The Cily of Huntington Beach Community Facilities Districts 1990-1 2000-1 . t
and Boein (Community Facilities Districts), and the Reservoir Hill Assessment t
District (the Assessment District) were formed to construct public improvements f
within the City boundaries. The governing board of these districts is the City Council.
The proceeds of debt issued and the expenditures for the public improvements are
recorded in capital projects funds. The Community Facilities Districts' debt is not an t
obligation of the City. There are no separate financial statements prepared for these t
entities.
t
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25
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City of Huntington Beach
.• Notes to Financial Statements
• For the Year Ended September 30, 2005
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
•
a. Reporting Entity
The Huntington Beach Auto Business Improvement District (the Business
• Improvement District) was formed in 1992 to fund capital improvements within this
r non-contiguous district. The Business Improvement District's governing body is the
;• City Council. The business owners within the district petitioned the City Council under
the Streets and Highways Code to form the district, which assisted in the funding of an
9 electronic reader board sign advertising the auto dealers. There are no separate
• financial statements for this entity.
0 b. Government-Wide Financial Statements
•
• The Government-Wide Financial Statements include a Statement of Net Assets, a
• Statement of Activities, and Changes in Net Assets. These statements present
• summaries of Governmental and Business-Type Activities for the City accompanied by a
total column. Fiduciary activities of the City are not included in these statements. These
• statements are presented on an "economic resources" measurement focus and the
• accrual basis of accounting. Accordingly, all of the City's assets and liabilities, including
• capital assets, infrastructure assets, and long-term liabilities, are included in the
accompanying Statement of Net Assets. The Statement of Activities presents changes in
• net assets. Under the accrual basis of accounting, revenues are recognized in the period
• in which they are earned while expenses are recognized in the period in which the liability
is incurred.
• The statement of activities demonstrates the degree with which the direct expenses of a
given function or segment are offset by program revenues. Direct expenses are those
that are clearly identifiable with a specific function or segment. Indirect expenses are
allocated to the various functions based on a proportionate use of services. The types of
transactions reported as program revenues for the City are reported in three categories:
1) charges for current services, 2) operating grants and contributions, and 3) capital
• grants and contributions. Taxes and other items not properly included among program
• revenues are reported as general revenues.
• Government-wide financial statements do not provide information by fund or account
• group. They simply distinguish between governmental and business activities. The
• City's statement of net assets includes both current and non-current assets and liabilities.
•
•
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•
! 26
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0
. City of Huntington Beach
Notes to Financial Statements
f,.
For the Year Ended September 30, 2005
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
b. Government-Wide Financial Statements
Financial Statement Classification
In the Government-Wide financial statements net assets are classified in the following
categories:
Invested In Capital Assets, Net of Related Debt — This category groups all capital
assets, including infrastructure, into one component of net assets. Accumulated
depreciation and the outstanding balances of debt that are attributable to the acquisition,
construction or improvement of these assets reduce this category.
Restricted Net Assets — This category presents restrictions imposed by creditors,
grantors, contributors, laws or regulations of other governments and restrictions imposed
by law through constitutional provisions or enabling legislation. This category presents
restrictions placed on the categories of Capital Projects, Debt Service, and Specific
Projects and Programs as established by the City Council. C
Unrestricted Net Assets — represent the net assets of the City, not restricted for any t
project or other purpose.
c. Fund Financial Statements t;
Separate fund financial statements are prepared for governmental funds, proprietary
funds, and fiduciary funds. Major individual governmental and enterprise funds are
reported as separate columns in the fund financial statements.
The City applies all applicable GASB pronouncements (including all NCGA Statements t
and Interpretations currently in effect) as well as the following pronouncements issued on #
or before November 30, 1989, to the business type activities, unless those t
pronouncements conflict with or contradict GASB pronouncements, Financial Accounting t
Standards Board (FASB) Statements and Interpretations, Accounting Principles Board
(APB) Opinions, and Accounting Research Bulletins (ARB) of the committee on
Accounting Procedure. The City applies all applicable FASB Statements and t
Interpretations issued after November 30, 1989, except those that conflict with or t
contradict GASB pronouncements.
Measurement Focus Basis of Accounting, and Financial Statement Presentation t
All governmental funds are accounted for on a spending or "current financial resources" t
measurement focus and the modified accrual basis of accounting. Only current assets
and current liabilities are included on the Balance Sheets, The Statement of Revenues,
Expenditures and Changes in Fund Balances present increases (revenues and other 1
financing sources) and decreases (expenditures and other financing uses) in net current
27 ;
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City of Huntington Beach
• Notes to Financial Statements
For the Year Ended September 30, 2005
•
i 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
0
• c, Fund Financial Statements
0 assets. Under modified accrual basis of accounting, revenues are recognized in the
• accounting period in which they become both measurable and available to finance
• expenditures of the current period. Revenues are recorded when received in cash, except
0 those revenues that are subject to accrual (generally 60 days after year-end) are
recognized when due. The primary revenue sources, which have been treated as
susceptible to accrual by the City, are property tax, sales tax, intergovernmental revenues
0 and other taxes. Expenditures are recorded in the accounting period in which the related
fund liability is incurred.
0 In the Fund financial statements, reserves and designations segregate portions of fund
i balance that are either not available or have been earmarked for specific purposes. The
• various reserves and designations are established by actions of the City Council and
0 Management and can be increased, reduced or eliminated by similar actions.
• The City reports the following major funds:
•
Governmental Funds
• General Fund - used to account for activity not required to be accounted for in
another fund
• Redevelopment Apency — accounts for the acquisition and construction of capital
assets and the related debt service activity for certain projects in the City's
Redevelopment project areas
0 • Public Financing Authority—accounts for the activity of the Huntington Beach Public
• Financing Authority
• Grant Fund — accounts for revenues and expenses of grant-related activity
0 Proprietary Funds
• Water Fund — used to account for water sales to customers
Sewer Service Fund — accounts for user fees charged to residents and
• businesses for sewer services
• Refuse Fund — used to account for the activities of the City's refuse program
Governmental Fund Financial Statements
Governmental Fund Financial Statements include a Balance Sheet and a Statement of
Revenues, Expenditures and Changes in Fund Balances for all major governmental funds
0 and non-major funds aggregated. An accompanying schedule is presented to reconcile
6 and explain the differences in net assets as presented in these statements to the net
assets presented in the Government-Wide Financial Statements. The City presents all
• major funds that met those qualifications.
•
28
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r City of Huntington Beach
r Notes to Financial Statements
For the Year Ended September 30, 2005
r
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
c. Fund Financial Statements
Proprietary Fund Financial Statements
Proprietary Fund Financial Statements include a Statement of Net Assets, a Statement of
Revenues, Expenses and Changes in Fund Net Assets, and a Statement of Cash Flows
for each major proprietary fund and non-major funds aggregated.
Proprietary funds are accounted for using the"economic resources" measurement focus
and the accrual basis of accounting. Accordingly, all assets and liabilities (whether current
or non-current)are included on the Statement of Net Assets. The Statement of Revenues,
Expenses and Changes in Fund Net Assets presents increases (revenues) and
decreases (expenses) in total net assets. Under the accrual basis of accounting, revenues
are recognized in the period in which they are earned while expenses are recognized in
the period in which the liability is incurred.
Operating revenues in the proprietary funds are those revenues that are generated from C
the primary operations of the fund. All other revenues are reported as non-operating
revenues. Operating expenses are those expenses that are essential to the primary
operations of the fund. All other expenses are reported as non-operating expenses.
Fiduciary Fund Financial Statements
Fiduciary Fund Financial Statements include a Statement of Net Assets and a Statement
of Changes in Net Assets for Trust Funds. The City's Fiduciary funds represent Agency
Funds, which are custodial in nature (assets equal liabilities) and do not involve
measurement of results of operations. The Agency funds are accounted for on the
accrual basis of accounting. Contributions made are funded by a percentage of payroll
and are recognized when the payroll is incurred. Fiduciary funds are not presented in the
government-wide financial statements because these funds do not represent net assets
available to the City.
Reconciliations of Financial Statements
Reconciliation of the Fund financial statements to the Government-Wide financial
statements is provided to explain the differences created by the integrated approach of
GASB Statement No. 34. r
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City of Huntington Beach
Notes to Financial Statements
• - For the Year Ended September 30, 2005
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
•
a d. Cash and Investments
• The City records investments at fair value. The City pools cash resources of its various
funds to facilitate cash management. Cash in excess of current requirements is invested
and reported as investments. It is the City's intent to hold investments until maturity.
However, the City may, in response to market conditions, sell investments prior to
maturity in order to improve the quality, liquidity or yield of the portfolio. Interest earnings
• are apportioned among funds based on ending accounting period cash and investment
0 balances.
0 The City's cash and cash equivalents are considered to be cash on hand, demand
• deposits, and highly liquid investments with original maturities of three months or less at
a the time of acquisition.
• In accordance with GASB Statement No. 31, Accounting and Financial Reporting for
• Certain Investments and for External Investment Pools, highly liquid market investments
• with maturities of one year or less at time of purchase are stated at amortized cost. All
other investments are stated at fair value. Market value is used as fair value for those
• securities for which market quotations are readily available.
• The City participates in the Local Agency Investment Fund (LAIF), an investment pool
• managed by the State of California. LAIF has invested a portion of the pool funds in
Structured Notes and Asset-Backed Securities. LAIF's investments are subject to credit
• risk with the full faith and credit of the State of California collateralizing these investments.
• In addition, these Structured Notes and Asset-Backed Securities are subject to market
! risk as a result of changes in interest rates. The City's investment policy is further
• discussed in note 2 on pages 34-35.
• e. Capital Assets
0 Capital assets, which include property, plant, equipment, and infrastructure, are reported
• in the applicable governmental or business-type activities columns in the government-
0 wide financial statements. Capital assets have an acquisition cost of$10,000 or greater
i ($50,000 for infrastructure) and a useful life of two years or more. The City records all
purchased capital assets at historical cost (where historical records are available) and at
estimated historical cost where no historical records exist. Capital assets acquired from
• gifts or contributions are recorded at fair market value at the time received, or in the case
• of infrastructure assets, at City Council acceptance date.
• In the Government-Wide and proprietary fund financial statements, depreciation is
• recorded on the straight-line method over the estimated useful lives of the assets shown
below and charged to the respective fund. No depreciation is recorded in the
governmental funds of the fund financial statements.
•
• 30
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City of Huntington Beach
Notes to Financial Statements
For the Year Ended September 30, 2005
C
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
e. Capital Assets
Production, pumping transmission and distribution plant 10 to 15 years
General Plant 20 to 50 years
Transportation Equipment 5 to 30 years
Infrastructure 50 Years
Interest is capitalized on proprietary fund assets acquired with tax-exempt debt. The
amount of interest to be capitalized is calculated by offsetting interest expense incurred
from the date of borrowing until completion of the project with interest earned on the
invested proceeds over the same period.
f. Inventories
Proprietary inventories are valued at weighted-average cost. There are no inventories in
governmental funds. {
g. lnterfund Transactions
C
As a general rule, interfund transactions have been eliminated from the government-wide
financial statements. Exceptions to this rule are payments in-lieu or charges for current
service between the City's enterprise activity and the City's General Fund. Elimination of
these transactions would distort the direct costs and program revenues for the various
functions. Certain eliminations have been made regarding interfund activities, payables
and receivables. All internal balances in the Statement of Net Assets have been {
eliminated except those representing balances between the governmental activities and
the business-type activities, which are presented as internal balances and eliminated in
the total primary government column. t
Numerous transactions occur between funds of the City resulting in transfers, amounts .
due to or from other funds. Amounts due to or from are the current (due within one year) t
portion of moneys that are to be paid or to be received from other funds. {
t
h. Long-Term Obligations
{
In the government-wide and proprietary fund financial statements, long-term obligations {
are recorded as liabilities in the applicable governmental activities, business type {
activities, or proprietary fund-type statement of net assets. Bond premiums and {
discounts, as well as issuance costs, are deferred and amortized over the life of the debt
for all issues after October 1, 2001. Premiums and discounts for debt issued before t
October 1 , 2001 are not recorded or amortized. t
31 ;
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City of Huntington Beach
• Notes to Financial Statements
u , For the Year Ended September 30, 2005
•
• 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
h: Long-Term Obligations
• In the governmental fund financial statements, bond discounts and premiums are
recognized as other financing source or use. Issuance costs are recorded as current
year expenditure.
•
• i. Employee Compensated Absences
i The Agency records the cost of all accumulated and unused leave time (vacation, sick,
and comp) as a liability when earned in the government-wide financial statements. In the
fund financial statements these amounts are recorded as expenditures in the years paid
since it is the City's policy to pay these from future financial resources, rather than
• available, spendable resources.
•
j. Property Tax Revenue
• Property tax in California is levied according to Article 13-A of the California Constitution.
The basic levy is a countywide-levy of one percent of total assessed valuation and is
allocated to county governments, school districts, cities and special districts. Additional
levies require two-thirds approval by voters and are allocated directly to the specific
• government.
r In the government-wide financial statements, property tax is recorded when earned,
regardless of when levied, due, or received. In the fund financial statements, property tax
• revenue is recognized in the fiscal year levied provided that revenue is collected in time to
• pay current year liabilities. Deferred property tax revenue represents property taxes
related to the current fiscal year that are collected more than 60 days after the fiscal year
end. Since the City's fiscal year differs from the County's property tax year, there is a
0 difference between the property tax revenue recorded on the fund financial statements
• and the government-wide financial statements. This is noted as a reconciling item in both
• the Reconciliation of the Statements of Revenues, Expenditures, and Changes in Fund
i Balance of Governmental Funds to the Statement of Activities and the Reconciliation of
the Balance Sheet of Governmental Funds to the Statement of Net Assets. The County
• acts as a collection agent for property tax for all of the local govemmental units. Property
• taxes are normally collected twice per year.
•
•
•
•
•
•
* 32
•
City of Huntington Beach
r= Notes to Financial Statements
For the Year Ended September 30, 2005
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
j. Property Tax Revenue
The property tax calendar is as follows:
• Lien Date-January 1 - Prior Fiscal Year
• Levy Date-July 1 - Prior Fiscal Year
• Due Date, First Installment - November 10
• Due Date, Second Installment - February 10
• Delinquent Date, First Installment - December 10
• Delinquent Date, Second Installment - April 10
The taxes are paid to the local governments periodically during the year. Below are the
dates of the payments from the County:
• Payments of First Installment November to December
• Balance of First Installment February 1
• Payments of Second Installment March to April
• Balance of Second Installment July 26
C
k. Allocation of Interest Income Among Funds
The City pools all non-restricted cash for investment purchases and allocates interest
income based on month-end cash balances. Funds that have restricted cash record
interest income in the respective fund.
I. Cash Flow Statements
For purposes of the Statement of Cash Flows, the Proprietary Fund types consider all
cash and investments to be cash equivalents, as these funds participate in the citywide
cash and investment pool. t
m. Estimates
The accompanying financial statements require management to make estimates and {
assumptions that effect certain report amounts and disclosures. Actual results could differ e
from those estimates.
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0 City of Huntington Beach
• r" Notes to Financial Statements
• - For the Year Ended September 30, 2005
• 1
2. CASH AND INVESTMENTS
•
0 Cash and investments were recorded in the government-wide statements as follows (in
0 thousands):
Investment Maturities In Years
DEPOSITS: Fair Value Less than 1 1 to 3 3 to 5 More than 5 Total
41111 Demand Accounts $ 18 $ 18 - - - $ 18
INVESTMENTS:
0 US Treasuries 25,007 14,868 10,139 - 25,007
0 US Agencies 93,754 25,738 52,281 15,735 - 93,754
Guaranteed Investment Contracts 8,190 - - - 8,190 8,190
Commercial Paper 11,924 11,924 - 11,924
Money Market Funds 648 648 - - - 648
Medium Term Notes 2,489 2,489 - - - 2,489
Local Agency Investment Fund 24,416 24,416 - - - 24,416
. Subtotal of Investments 166,428 80,083 62,420 15,735 8,190 166,428
Total Deposits and Investments $ 166,446 $ 80,101 $ 62,420 $ 15,735 $ 8,190 $ 166,446
At September 30, 2005 the City had the following investments and maturities (amounts in
thousands):
Statement of Net Assets:
Cash and Investments $ 62,166
• Restricted Assets(Cash and Cash Equivalents) 92,036
Cash with Fiscal Agent- Restricted 12,244
Total Per Statement of Net Assets 166,446
Fiduciary Funds:
• Cash and Investments-Local Agency Investment Fund 23,572
Cash with Fiscal Agent- Restricted 8,318
Total Fiduciary Funds 31,890
Total Cash and Investments $ 198,336
• Interest Rate Risk - As a means of limiting exposure to fair value losses arising from
• interest rates, the City's investment policy limits investments over three years to be 30%
or less.
Credit Risk- State law limits investments in commercial paper and corporate bonds to
have at least an "A" rating issued by a nationally recognized statistical rating organization.
It is the City's policy to limit its investments in these investment types to the top two
ratings issued by these rating rganizations. As of September 30, 2005, Standard and
Poor's and Moody's Investor's Service rating of the City's investments in commercial
paper were Al or better and p-1, respectively. Standard and Poor's rated the City's
•
S 34
•
City of Huntington Beach
Notes to Financial Statements
00 For the Year Ended September 30, 2005
2. CASH AND INVESTMENTS (Continued)
f
investments in medium-term bonds AAA or AA, and a rating of Aaa, Aa or A was placed C
by Moody's.
Concentration of Credit Risk—The City's investment policy limits investments in any one
issuer to no more than 10% of the investments and each investment type has a specific
limit.
f
Local Agency Investment Fund - As of September 30, 2005, the City held a total of
$45,465,000 in callable securities, which amounted to approximately 27% of investments.
In addition, the City investments with the Local Agency Investment Fund (LAIF), a State of
California investment pool, which at September 30, 2005 also included a portion of the
pool funds invested in Structured Notes and Asset-Backed Securities. Asset-Backed
Securities, the bulk of which are mortgaged-backed securities, entitle their purchasers to
receive a share of the cash flows from a pool of assets such as principal and interest
3. DEFERRED COMPENSATION
Permanent City employees may defer a portion of their salary under Section 457 of the
Internal Revenue Code. This plan permits employees to defer a portion of their salary until
future years. The compensation is not available to the employees until termination,
retirement, or unforeseen emergency. t
The City has established a trust for the assets of the plan held by third parties.All property
and rights purchased with these assets, as well as all income attributable to them are held t
in trust for the exclusive benefit of the participant and their beneficiary. The amounts are
no longer the property of the City and are not subject to the claims of the City's general
creditors. Amounts administered by outside organizations in a trustee capacity are no
longer reported as assets of the City. The City does not have fiduciary responsibility for t
these assets. t
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City of Huntington Beach
• ram.; Notes to Financial Statements
• ;;. ,,. ; For the Year Ended September 30, 2005
4. DEFERRED REVENUE
•
• Certain revenues in governmental funds are deferred until received. The property tax
• amounts are recognized in the year as revenue in the government-wide financial
statements, but are recorded as deferred revenue in the fund financial statements. The
• other amounts are unearned revenue in both the funds and government-wide financial
• statements. The amounts are as follows (in thousands):
•
Deferred Other
• Property Deferred
Taxes Revenue Total
• General Fund $ 11,364 $ - $ 11,364
Grant Fund - 3,436 3,436
• Redevelopment Agency 841 4,943 5,784
• Total $ 12,205 $ 8,379 $ 20,584
5. RETIREMENT PLAN — NORMAL
• a. Plan Description
•
The City contributes to the California Public Employees' Retirement System (CALPERS),
an agent, which is a multiple-employer public employee defined benefit pension plan.
CALPERS provides retirement and disability benefits, annual cost-of-living adjustments,
and death benefits to plan members and beneficiaries. CALPERS acts as a common
investment and administrative agent for participating public entities within California.
Benefit provisions and all other requirements are established by state statute and city
ordinance. Copies of CALPERS annual financial report may be obtained from their
• executive office- 400 P Street, Sacramento, CA 95814.
• The City makes two types of contributions for covered employees. The first contribution
represents the amount the City is required to make (the employer rate). The second
• represents an amount, which is made by the employee, but is reimbursed to the employee
• by the City (the member rate). The member rate is set by contract and normally remains
unchanged.
•
•
•
•
•
•
•
• 36
•
City of Huntington Beach
f ,. Notes to Financial Statements
For the Year Ended September 30, 2005
5. RETIREMENT PLAN — NORMAL (Continued)
b. Employer and Employee Contribution Obligations
The employer rate is an actuarially established rate, is set by CALPERS, and changes
from year to year. The employer rates for the fiscal year ending September 30, 2005 are:
October 1, 2004 to June July 1, 2005 to
30, 2005 September 30, 2005
Local Miscellaneous 0.000% 7.182% f
Local Safety 25.144% 29.957%
The member rates are as follows:
C
Rate f
Local Miscellaneous 7.000%
Local Safety 9.000%
c. Annual Pension Cost C
t;
The City's annual pension cost of$ 8,729,000 was equal to the City's required and actual {
contributions. The required contribution was determined as part of a June 30, 2004
actuarial valuation using the entry age normal actuarial cost method.
f
CALPERS conducted an actuarial valuation utilizing the entry-age actuarial cost method
and a level percent of payroll to determine the City's net pension obligation as of June 30,
2005. Significant assumptions were: f
• Average amortization remaining period — 32 Years as of the Valuation Date (safety)
and 5 Years as of the Valuation Date (miscellaneous)
• Asset valuation method — 15 Years Smoothed Market f
• Investment Rate of Return — 7.75%
• Projected salary increases — 3.25% to 13.15% (safety) and 3.25% to 14.45%
(miscellaneous) depending on age, service, and type of employment
• Inflation — 3.00%
• Payroll growth — 3.25%
• Individual salary growth — A merit scale varying by duration of employment coupled
with an assumed annual inflation component of 3.0% and an annual production growth {
of .25%
c
Initial unfunded liabilities are amortized over a closed period that depends on the plan's
date of entry into CALPERS. Subsequent plan amendments are amortized as a level
percent of pay over a closed 20-year period. Gains and losses that occur in the operation
37 t
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• r`�'~� City of Huntington Beach
# . : Notes to Financial Statements
f .N }..; For the Year Ended September 30, 2005
5. RETIREMENT PLAN — NORMAL (Continued)
• c. Annual Pension Cost
!
of the plan are amortized over a rolling period, which results in an amortization of 6% of
the unamortized gains and losses each year. If the plan's accrued liability exceeds the
• actuarial value of the assets, then the amortization payment on the total unfunded liability
r may not be lower than the payment calculated over a 30-year amortization period.
d. Trend Information
•
# Annual Percentage of Net Pension
Fiscal Year Pension Cost APC Funded Obligation
0 9/30/2003 $5,583 100% $0
0 9/30/2004 $8,123 100% $0
9130J2005 $8,729 100% $0
6. RETIREMENT PLAN — SUPPLEMENTAL
•
a. Plan Description
The City provides a supplemental retirement plan for employees hired prior to 1999
• (specific dates vary by employee bargaining association). It is a single-employer PERS. It
is a defined benefit plan and will pay the retiree an additional amount to his or her normal
amount for life. The City's contracts with employee bargaining associations establish the
plan. These associations must agree to any changes to the plan. The amount will cease
upon the employee's death. The amount that is computed as a factor of an employee's
normal retirement allowance is computed at retirement and remains constant for his or her
0 life. Of the 980 active employees reported on the July 1, 2005 data, only 576 were eligible
for plan benefits. No separately prepared financial statements are prepared for this plan
# and it is not included in the financial report of any other pension plan. The assets used to
pay these liabilities have not yet been set up in a legal trust.
• b. Employer Obligations and Funding Status and Progress
•
• The City annually transfers amounts from the various City funds to a pension trust fund.
The City is required to contribute an actuarially determined rate 4.29% of total payroll for
all permanent employees. Administrative costs of this plan are financed through
investment earnings.
•
•
•
•
w 38
•
City of Huntington Beach
� << Notes to Financial Statements
- For the Year Ended September 30, 2005
6. RETIREMENT PLAN — SUPPLEMENTAL (Continued)
c. Annual Pension Cost and Net Pension Obligation
The City's annual pension cost and net pension obligation for this plan at .dune 30, 2005 �
were (in thousands):
Annual required contribution $3,074
Interest on net pension obligation 463
Adjustment to annual required contribution (637) f
Annual pension cost 2,900
Contributions made 3,675
Increase (decrease) in net pension obligation (775)
Net Pension Obligation — Beginning of Year 8,415
Net Pension Obligation — End of YearZ
The annual required contribution was determined as part of an independent actuarial
valuation using the Entry Age Normal Actuarial Cost Method which is a projected benefit
full-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 used were:
• Rate of return on present and future assets — 5.5% per annum
• Projected salary increases for covered employees due to inflation —3.0% per annum
• Projected salary increases due to merit — 0%
• Inflation rate — 3.0%
• Post employment benefit increases — 0%
• Amortization of unfunded liability — level percentage of pay ending in 2027 (closed)
• Actuarial value of assets — market value
d. Trend Information
fi
Below is the required three-year trend information (dollar amounts in thousands):
Fiscal Year Annual Pension Percentage of Net Pension t
Cost APC Funded Obligation
6130103 $2,786 100% $8,342 t
6/30/04 $3,073 98% $8,409 t
6/30/05 $2,900 127% $7,640
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City of Huntington Beach
`a Notes to Financial Statements
• ; ,,.; For the Year Ended September 30, 2005
•
• 6. RETIREMENT PLAN — SUPPLEMENTAL (Continued)
•
• d. Trend Information
• Below is other required trend information (dollar amounts in thousands):
• Fiscal Year Annual Percentage of
Ending June Required ARC
• 30, Contribution Contributed
1992 $1,391 17%
• 1993 1,546 16%
1994 1,697 14%
• 1995 1,790 22%
1996 1,968 41%
1997 1,952 155%
1998 2,151 70%
1999 2,613 60%
2000 2,638 62%
2001 2,578 88%
• 2002 2,836 88%
2003 2,937 103%
. 2004 3,231 93%
2005 3,074 120%
•
•
• e. Accounting for Plan
• Since the City is required to adopt GASB 25 for the supplemental pension plan, the
difference between the ARC and the amount of pension cast funded for the years in which
there was an actuarial study must be recorded as a liability in the government-wide
financial statements. The amount of this liability is $7,640,000. Benefits are recognized
• when due and payable. Actuarial studies and updates were performed since 1991 and
there is a substantial amount of unfunded pension benefit liability that would have been
recorded as a liability in the government-wide financial statements if the studies had been
performed (see Note 10).
•
7. POST-EMPLOYMENT MEDICAL INSURANCE
a. Plan Description
N
• The City agreed via contract with each employee association to provide a subsidy to
retirees to purchase post-employment medical insurance. The benefits are fixed in
amounts, based on years of service, and available to all retirees who meet all three of the
following criteria:
•
40
City of Huntington Beach t;
Notes to Financial Statements
For the Year Ended September 30, 2005
7. POST-EMPLOYMENT MEDICAL INSURANCE (Continued)
a. Plan Description
• At the time of retirement the employee is employed by the City.
• At the time of retirement the employee has a minimum often years of service creditor
is granted a service connected disability retirement.
• Following official separation from the City, CALPERS grants a retirement allowance.
The City's obligation to provide the benefits to a retiree ceases when either of the
following occurs:
• During any period the retiree is eligible to receive health insurance at the expense of
another employer.
• The retiree becomes eligible to enroll automatically or voluntarily in Medicare.
f
If a retiree dies, the benefits that would be payable for his or her insurance are provided to
the spouse or family for 12 months. Benefits for insurance premiums are payable based
on the years of service credit for the retiree. The retiree may use the subsidy for any of
the medical insurance plans that the City's active employees may enroll. t
C
The assets used to pay these liabilities have not yet been set up in a legal trust.
b. Accounting and Funding
t
The Retiree Medical Insurance Fund is an agency fund. Other funds contribute on a
periodic basis. Employees do not contribute. The actuarial assumptions for the plan are t
identical to the assumptions used for the Retirement Supplement Plan (see Note 6). t
Below are the required disclosures for this plan (in thousands):
t
Number of active participants 980
Employer's actuarially required contributions $740 t
Employer's actual contributions $975
Below is a summary of the Unfunded Actuarial Accrued Liability for the plan (in
thousands): _
Actuarial accrued liability $11,561
Net assets available for plan benefits $4,829 t
Unfunded Actuarial Accrued Liability $6,732 t
Under current generally accepted accounting principles, recording of unfunded liabilities i
on other post-employment benefits in the financial statements is not required. t
41
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to City of Huntington Beach
Notes to Financial Statements
! `. :, ,,,, For the Year Ended September 30, 2005
8. RISK MANAGEMENT
!
! The City is exposed to various risks of losses related to torts; theft of, damage to and
destruction of assets; errors and omissions; injuries to employees; natural disasters and
employee health insurance claims. The City records all of these claims as expenditures in
* the General Fund. The liability for these claims is recorded as part of long-term
obligations in the Government-Wide financial statements. The City records the amount of
claims payable at year-end that is due and payable at year-end in the fund financial
statements. The full amount of claims is reported as a liability in the government-wide
! financial statements. Liabilities include amounts incurred, but not reported.
! Liability Claims:
! Claims of up to $1,000,000 are paid from the General Fund. The City is also a participant
in the Big Independent Cities Excess Pool Joint Powers Authority (BICEP), which
! provides general liability insurance of $24,000,000 above the City's retention of
$1,000,000. BICEP was created by a joint powers agreement between the City of
Huntington Beach and four other local entities for the purpose of providing joint insurance
• coverage and related risk management services for member cities. BICEP allows member
entities to finance claims payment pool for certain liability claims in excess of$1 million to
a limit of $25 million. BICEP's governing board has one representative from each city
! (either a member of the City Council or designate). Current members must approve any
# changes to the board. Each participating City pays an insurance premium to BICEP that
is used to fund the operating and debt service requirements.
Workers' compensation claims of up to $350,000 per claim and liability claims of greater
than $100,000 per claim are paid from these funds.
The City purchases independent insurance coverage for liability and workers'
! compensation claims in excess of the above amounts. Settled claims have not exceeded
this commercial coverage in any of the past three fiscal years. All funds of the City
participate in the program and make payments to these funds based on estimated cost
• information.
The City reports liabilities at year-end that can be reasonably estimated claims prior to the
issuance of the financial statements including an estimate of incurred but not reported
claims.
•
•
•
•
•
•
•
• 42
•
City of Huntington Beach
r Notes to Financial Statements
For the Year Ended September 30, 2005
8. RISK MANAGEMENT (Continued)
Claims activity and liabilities relating to the current and prior year are (in thousands): fi
Health Workers Liability Total
Insurance Compensation Insurance
Balance September 30, 2003 $ 400 $ 6,569 $ 8,084 $ 15,053
Additions 2003-2004 6,511 2,041 4,080 12,632 C
Reductions - 2003-2004 (6,911) (2,701) (1,036) (10,648) t;
Net Increase(Decrease)2003-2004 400 660 3,044 1,984
Balance September 30, 2004 - 5,909 11,128 17,037
Additions 2004-2005 - 1,874 5,062 6,936
Reductions-2004-2005 _ - (990) (2,494) (3,484)
Net Increase (Decrease) 2004-2005 - 884 2,568 3,452 t
Balance September 30, 2005 $ - $ 6,793 $ 13,696 $ 20,489
Below is a reconciliation of the above schedule of total claims payable to the financial
statements (in thousands):
Current Claims Payable — Reported on the Balance Sheet of Both the
Government- Wide and Fund Statements $ 5,944
Claims Payable — Long-Term (Greater than One Year) — Reported in C
Government Wide Statements, but not in Fund Statements 14,545
Total $ 20,489
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43
•
City of Huntington Beach
• ; ,:- Notes to Financial Statements
• For the Year Ended September 30, 2005
9. INTERFUND TRANSACTIONS
•
a. Due To/From Other Funds
The amounts at September 30, 2005 were (in thousands):
•
• Due from Due to Other
• Other Funds Funds
Governments! Funds:
• Gas Tax $ 863 $ -
Drainage - 863
• Total Due tolfrom Other Funds Governmental Funds 863 863
Proprietary Funds:
• Water 211 -
• Refuse - 211
Total Proprietary Funds 211 211
• Total all Funds $ 1,074 $ 1 074
•
•
• These outstanding balances result mainly from short-term borrowings to cover payments
• for goods and services.
• b. Advances to/from Other Funds
•
There is $1,836,000 advanced from the General Fund to the Park Acquisition and
Development Fund (a non-major governmental fund) for closed school site purchases.
• The amount will be repaid within 3 years.
•
•
•
•
•
•
•
•
•
•
•
•
•
•
. 44
•
O
City of Huntington Beach
Notes to Financial Statements
For the Year Ended September 30, 2005
9. INTERFUND TRANSACTIONS (Continued)
c. Transfers In/Out
The amounts at September 30, 2005 were (in thousands)-
Transfers Out
Non-Major Total
Redevelopment Governmental Governmental
Transfers to General Fund Agency_ Grants Funds Funds
General Fund $ 59 $ 5,033 $ 18 $ 1,530 $ 6,64
Redevelopment Agency 270 - - - 27
Public Financing Authority 5,686 63 159 5,90
Grants 259 - 12 12 28
Non-Major Governmental Funds 711 - 1,293 269 2,27
Total Governmental Funds 6,985 5,096 1,323 1,970 15,37
Refuse Fund 143 - - - 14
Non-Major Enterprise Funds 484 5 48 f
Total Enterprise Funds 627 - 5 63
Total Transfers Out $ 7,612 $ 5,096 $ 1,323 $ 1,975 $ 16,00
Transfers Out
Non-Major
Enterprise Total
Transfers In Water Fund Funds Transfers In
General Fund $ 5,039 $ 194 $ 11,87
Redevelopment Agency - - 27
Public Financing Authority 283 6,191
Grants - 28
Non-Major Governmental Funds - - 2,27
Total Governmental Funds 5,039 477 20,89
Refuse Fund - - 14
Non-Major Enterprise Funds - 48
Total Enterprise Funds - 63
otal Transfers Out $ 5,039 $ 477 $21,52 C
C
These routine transfers were made in the normal course of City operations and are mainly C
used to:
• Move revenues from a specific fund to the specific debt service fund as payments t
become due. t
• Move monies to specific funds to finance programs that the City wishes to or is
required to account for in other funds.
• Close out or open specific funds per City Council direction.
(
45
• City of Huntington Beach
• Notes to Financial Statements
• - For the Year Ended September 30, 2005
10.LONG-TERM OBLIGATIONS
•
• Below is a schedule of changes in long-term governmental obligations for the year (in
thousands):
•
• Principal Due
October 1, September Accrued Within One
• Note 2004 Additions Retirements 30,2005 Interest Year
Judgment Obligation Bonds 10(a) $ 12,500 $ $ (255) $ 12,245 $ 70 $ 720
• Public Financing Authority:
1997 Leasehold Revenue Bonds 10(b)(1) 4,940 (610) 4,330 5B 640
2000 Certificates of Participation 10(b)(2) 16,140 (615) 15,525 83 640
. 2001-a Lease Revenue Bonds 10(b)(3) 29,635 (605) 29,030 141 630
• 2001-b Lease Revenue Bonds 10(b)(4) 26,265 (1,595) 24,670 163 1,640
Total Public Financing Authority 76,980 - (3,425) 73,555 445 3,550
•
• Redevelopment Agency:
1999 Tax Allocation Refunding
Bonds 10(c)(1) 8,840 (335) 8,505 66 350
• 2002 Tax Allocation Refunding
Bonds 10(c)(2) 19,465 (765) 18,700 137 790
• Mayer Disposition and Development
Agreement 10(c)(3) 10,730 655 (1,302) 10,083 - -
• Section 108 Loan 10(c)(4) 7,850 - (300) 7,550 90 315
Total Redevelopment Agency 46,885 655 (2,702) 44,838 293 W 1,455
• Other Long-Term Obligations:
• California Energy Commission 10(d)(1) 337 - (221) 116 3 116
• Leases Payable 10(d)(2) 4,885 447 (1,871) 3,461 - 1,039
Compensated Absences 10(d)(3) 8,037 3,161 (2,153) 9,045 2,800
• Net Pension Obligation 10(d)(4) 8,409 999 (1,768) 7,640
• Claims Payable 10(d)(5) 11,937 6,092 (3,484) 14,545 - 3,425
Total Other Long-Term
Obligations 33,605 10,699 (9,497) 34,807 3 7,380
Total Long-Term Obligations-
Governmental Activities $ 169,970 $ 11,354 $ 15,879 $ 165,445 $ 811 $ 13,105
. 46
•
0
City of Huntington Beach
r Notes to Financial Statements
For the Year Ended September 30, 2005
10.LONG-TERM OBLIGATIONS (Continued)
Below are reconciliations from amounts in the above table to amounts in the
accompanying government-wide financial statements (in thousands):
Proceeds of Long-Term Debt in Governmental Fund Financial Statements $ 1,102
Increase in Net Pension Obligation 999
Increase in Compensated Absences 3,161
Increase in Claims Payable 6,092
Increases in Above Schedule $ 11,354
Principal Paid in Governmental Fund Financial Statements $ 8,474
Decrease in Compensated Absences 2,153
Decrease in Net Pension Obligation 1,768
Decrease in Claims Payable 3,484
Decreases in Above Schedule $ 16,879
a. Judgment Obligation Bonds
Year of Issuance 2004
Type of Debt Judgment Obligation Bonds
Original Principal Amount $12,500,000
Security Council Appropriations
Interest Rates 2.00% to 4.20% C
Interest Payment Dates February 1st and August 1st
Principal Payment Dates FebruaEy 1 st {
Purpose of Debt Pay claims on Court Judgment
f
Debt service requirements to maturity are (in thousands): c
Year Ending Principal Interest Total C
September 30
2006 $ 720 $ 420 $ 1,140
2007 730 405 1,135
2008 745 389 1,134 C
2009 765 369 1,134
2010 785 346 1,131
2011-2015 4,355 1,285 5,640
2016-2019 4,145 351 4,496
Total $ 12,245 $ 3,565 $ 15,810
47 Z
f
• City of Huntington Beach
• �' Notes to Financial Statements
• ,. ; For the Year Ended September 30, 2005
10.LONG-TERM OBLIGATIONS (Continued)
•
• b. Public Financing Authority
• (1) 1997 Public Financing Authority Revenue Bonds
•
• Year of Issuance 1997
Type of Debt Lease Revenue Bonds
Original Principal Amount $8,070,000
Security Lease Agreement with City for
• Central Library
Interest Rates 5.00% to 5.50%
• Interest Payment Dates June 15 and December 15
Principal Payment Dates December 15
• Purpose of Debt Construct Pier Plaza and
• Purchase 800 MHZ System
! Debt service requirements to maturity are (in thousands):
Year Ending Principal Interest Total
September 30
! 2006 $ 640 $ 214 $ 854
! 2007 665 181 846
2008 80 163 243
• 2009 85 159 244
! 2010 90 154 244
2011-2015 525 692 1,217
• 2016-2020 680 527 1,207
2021-2025 900 313 1,213
2026-2028 665 57 722
• Total $ 4,330 $ 2,460 $ 6,790
• (2) 2000 Public Financing Authority Certificates of Participation
• Year of Issuance 2000
• -Type of Debt Certificates of Participation
• Ori inal Principal Amount $18,310,000
-Security Lease with City
• Interest Rates 4.0% to 5.0%
Interest Payment Dates February 15 and August 15
Principal Payment Dates August 15
• Purpose of Debt Capital improvements and
defeasance of Emerald Cove
• Certificates of Participation
• 48
0
City of Huntington Beach
r . . 1 Notes to Financial Statements
„ For the Year Ended September 30, 2005
10.LONG-TERM OBLIGATIONS (Continued)
b. Public Financing Authority
(2) 2000 Public Financing Authority Certificates of Participation
Debt service requirements to maturity are (in thousands):
Year Ending principal Interest Total
September 30
2006 $ 640 $ 801 $ 1,441
2007 670 774 1,444
2008 700 744 1,444
2009 730 714 1,444
2010 760 680 1,440 l
2011-2015 2,685 2,981 5,666
2016-2020 3,465 2,20B 5,673
2021-2025 2,765 1,284 4,049
2026-2029 3,110 530 3,640
Total $ 15,525 $ 10,716 $ 26,241
(3) 2001(a) Public Financing Authority Lease Revenue Bonds
Year of Issuance 2001
Type of Debt Lease Revenue Bonds
Original Principal Amount $31,360,000
Security Lease Agreement with City for
Public Buildings
Interest Rates 2.45% to 5.0%
Interest Payment Dates February 15 and August 15
Principal Payment Dates August 15
Purpose of Debt Construct Sports Complex and
South Beach Phase II
Improvements
C
F
C
t
c
c
c
49
us
City of Huntington Beach
• Notes to Financial Statements
For the Year Ended September 30, 2005
•
• 10.LONG-TERM OBLIGATIONS (Continued)
•
• b. Public Financing Authority
(3) 2001(a) Public Financing Authority Lease Revenue Bonds
•
• Debt service requirements to maturity are (in thousands):
•
• Year Ending Principal Interest Total
September 30
0 2006 $ 630 $ 1,354 $ 1,984
0 2007 650 1,334 1,984
0 2008 675 1,312 1,987
0 2009 700 1,288 1,988
. 2010 725 1,262 1,987
2011-2015 4,085 5,842 9,927
2016-2020 5,075 4,848 9,923
• 2021-2025 6,420 3,510 9,930
2026-2030 8,180 1,740 9,920
• 2031 1,890 94 1,984
• Total $ 29,030 $ 22,584 $ 51,614
• (4) 2001(b) Public Financing Authority Lease Revenue Bonds
•
Year of Issuance 2001
Type of Debt Lease Revenue Bonds
Original Principal Amount $31,095,000
• Security Lease on Civic Center Buildings
• Interest Rates 4.0% to 5.0%
Interest Payment Dates August 1, February 1
Principal Payment Dates August 1
Purpose of Debt Defease Civic Improvement
Cor oration Certificates
•
•
•
•
•
•
•
•
• 50
0
0
City of Huntington Beach
Notes to Financial Statements
For the Year Ended September 30, 2005
C
10.LONG-TERM OBLIGATIONS (Continued)
C
b. Public Financing Authority
(4) 2001(b) Public Financing Authority Lease Revenue Bonds
Debt service requirements to maturity are (in thousands)-
Year Ending Principal Interest Total
September 30
2006 $ 1,640 $ 975 $ 2,615
2007 1,690 925 2,615
2008 1,745 875 2,620
2009 1,800 818 2,618
2010 1,880 737 2,617
2010-2014 10,565 2,523 13,088 C
2015-2019 5,350 525 5,875
Total $ 24,670 $ 7,378 $ 32,048
c. Redevelopment Agency
(1) 1999 Redevelopment Agency Tax Allocation Refunding Bonds C
Year of Issuance 1999 C
Type of Debt Tax Allocation Refunding Bonds C
Original Principal Amount $10,835,000
Security Tax Increment
Interest Rates 3.00% to 5.05%
Interest Payment Dates February 1 s and August 15
Principal Payment Dates August 15
Purpose of Debt Prepay Agency's 1992 Loans to
Public Financing AuthorityC
C
C
C
C
51
C
C
•
City of Huntington Beach
• Notes to Financial Statements
• ry, ,. ; For the Year Ended September 30, 2005
10.LONG-TERM OBLIGATIONS (Continued)
!
c. Redevelopment Agency
(1) 1999_RedevelopmentAgency Tax Allocation Refunding Bonds
•
• Debt service requirements to maturity are (in thousands):
• Year finding
• September 30 principal Interest Total
• 2006 $ 350 $ 393 $ 743
2007 365 380 745
2008 380 365 745
• 2009 390 350 740
2010 410 334 744
2011-2015 2,350 1,384 3,734
• 2016-2020 2,690 778 3,468
• 2021-2025 1,570 195 1,765
• Total $ 8,505 $ 4,179 $ 12,684
• (2) 2002 Redevelopment Agency Tax Allocation Refunding Bonds
•
Year of Issuance 2002
Type of Debt Tax Allocation Refunding Bonds
! Original Principal Amount $20,900,000
Security Tax Increment
! Interest Rates 2.00% to 5.00%
Interest Payment Dates February 15 and August 15
! Principal Payment Dates August 15
• Purpose of Debt Prepay Agency's 1992 Loans to
Public Financing Authority and
• fully defease 1992 Public
I ___ing Authority bonds
•
•
•
•
•
•
•
•
•
52
•
fi
City of Huntington Beach E
Notes to Financial Statements F
- For the Year Ended September 30, 2005 fi
10.LONG-TERM OBLIGATIONS (Continued) C
fi
c. Redevelopment Agency fi
(2) 2002 Redevelopment Agency Tax Allocation Refunding Bonds fi
Debt service requirements to maturity are (in thousands):
fi
Year Ending Principal Interest Total
September 30
2006 $ 790 $ 822 $ 1,612
2007 815 798 1,613 fi
2008 845 772 1,617
2009 870 742 1,612
2010 910 712 1,622 fi
2011-2015 5,175 2,989 8,164
2016-2020 5,880 1,703 7,583
2021-2024 3,415 424 3,839
Total $ 18,700 $ 8,962 $ 27,662
(3) Mayer Disposition and Development Agreement
In fiscal year 1996-97, the Agency entered into a disposition and development C
agreement with Robert Mayer Corporation (Corporation) concerning additional
development adjacent to the Waterfront Hotel. Under the agreement, the Corporation
would advance payments for the project costs with the Agency reimbursing up to
$16,750,000 of the costs.As of September 30, 2005, the Agency obligation under the
agreement amounted to $10,083,000. Project-generated revenues as available will
repay these amounts over the time needed to fully amortize the advance.
(
(4) Section 108 Loan
Year of Issuance 2000
Type of Debt Loan from Federal Government
Original_Principal Amount $8,570,000
Security Loan Agreement with Federal
Government
Interest Rates 7.7%
Interest Payment Dates February 15 and Au ust 1S
Principal Payment Dates I August 1 S
Purpose of Debt Capital improvements
t
t
53 t
c
• `"�' City of Huntington Beach
• Notes to Financial Statements
• ;4w,. ; For the Year Ended September 30, 2005
•
10.LONG-TERM OBLIGATIONS (Continued)
•
c. Redevelopment Agency
(4) Section 108 Loan
• Debt service requirements to maturity are (in thousands):
•
• Year Ending Principal Interest Total
September 30
2006 $ 315 $ 540 $ 855
i 2007 340 518 858
2008 365 493 858
2009 390 467 857
2010 415 439 854
2011-2015 2,520 1,681 4,201
2016-2019 3,205 553 3,258
• Total $ 7,550 $ 4,691 $ 11,741
!
• d. Other Long-Term Obligations
! (1) Energy Financing Loan
i
• Year of Issuance 1995
Type of Debt Note Payable — State of
0 California
• Original Principal Amount $1,116,003
• Security Loan Agreement
Interest Rates 6.1%
Interest Payment Dates February 22" and June 22"
! Principal Payment Dates February 22" and June 22"
• Purpose of Debt Ca ital Im rovements
• The remaining amount of $119,000 ($116,000 of principal and $3,000 of interest) is
• due and payable within one year.
•
i
•
i
•
•
• 54
City of Huntington Beach
Notes to Financial Statements
For the Year Ended September 30, 2005
10.LONG-TERM OBLIGATIONS (Continued)
d. Other Long Term Obligations
(2) Leases Payable
The City entered into capital leases for various items:
Year of Insurance 1996 through 2003
Type of Debt Capital Leases
Original Principal Amount Various $93,000 to $2,370,000
Security Lease Agreement
Interest Rates 4.4% to 6.2%
Interest Payment Dates Month! , Quarterly, Semi-Annual!
Principal Payment Dates Monthly, Quarterly, Semi-Annually
Purpose of Debt —Equipment Financing
t;
Future minimum lease payments to maturity are (in thousands).-
Year Ending Principal Interest Total
September 30
2006 $ 1,039 $ 138 $ 1,177
2007 535 100 635
2008 396 78 474
2009 352 60 412
2010 269 45 314
2011-2015 870 62 932 f
Total $ 3,461 $ 483 $ 3,944
f
(3) Compensated Absences =
There is no repayment schedule to pay the compensated absences amount of
$9,045,000 relating to governmental operations. The General Fund typically
liquidates the vacation and sick leave liability.
(4) Net Pension Obligation
t
f
There is no fixed repayment schedule to fund the actuarial liability for the unfunded net
pension obligation totaling $7,640,000 for the City's Retirement Supplement Plan t
described in Note 6. The amount will be funded through a contribution rate determined
by an independent actuarial study. This amount is significantly less than the total
unfunded liability for this plan since actuarial studies only began in 1991, which was t
after the plan was in place.
55
{
1
• City of Huntington Beach
• ". Notes to Financial Statements
• - ,, ,. ; For the Year Ended September 30, 2005
•
• 10.LONG-TERM OBLIGATIONS (Continued)
•
d. Other Long Term Obligations
•
• (5) Claims Payable
There is no repayment schedule for the claims payable of$14,545,000 described in
• note 8. The City pays the claims upon final settlement.
e. Long-Term Obligations — Business Activities
•
Below is a schedule of the long-term obligations of business activities (in thousands):
• Principal Due
October1, September Accrued Within One
• Note 2004 Additions I Retirements 1 30 2005 Interest Year
• Compensated Absences 10(e)(1) $ 710 $ 201 $ (125) $ 786 $ $ 162
• Leases Payable 1O(e)(2) 163 (71) 112 74
• Total Long-Term Obligations-
Business Activities $ 893 $ 201 $ (196) $ 898 $ $ 236
• (1) Compensated Absences
•
• There is no repayment schedule for the compensated absences amount of$786,000
relating to business activities.
•
(2) Leases Payable
The City entered into capital leases for various items:
•
• Year of Issuance 1993 through 2003
. Type of Debt Capital Leases
Original Principal Amount Various
• Security Lease Agreement
Interest Rates 4.4% to 6.2%
• Interest Payment Dates Monthly, Quarterly, Semi-
Annually
• Principal Payment Dates Monthly, Quarterly,
Semi-Annually
Purpose of Debt Equipment Financing
•
•
•
•
• 56
0
City of Huntington Beach {
Notes to Financial Statements {
For the Year Ended September 30, 2005 {
{
10.LONG-TERM OBLIGATIONS (Continued)
e. Long-Term Obligations — Business Activities {
(2) Leases Payable
Future minimum lease payments to maturity are (in thousands):
Year Ending principal Interest Total
September 30
2006 $ 74 $ 4 $ 78
2007 38 - 44
Total $ 112 $ 4 $ 122
f. Long-Term Obligations for which City is not Liable in any Manner t
Obligations Not Recorded in
Financial Statements:
September 30,
Community Facilities Districts: Note October 1,2004 Additions Retirements 2005
Community Facilities District No.
1990-1 Special Tax Refunding
Bonds 10(f)(1) $ 1,915 $ $ (85) $ 1,830
Community Facilities District 2000-
1 Special Assessment Tax Bonds 10(f)(2) 15,755 (255) 15,500
Community Facilities District NO.
2002-1 Special Assessment Tax
Bonds 10(f)(3) 4,900 (5) 4,895
Community Facilities District NO.
2003-1 Special Assessment Tax
Bonds 10(f)(4) 25,000 - 25,000 f
Total Community Facilities
Districts 47,570 (345) 47,225
No-Commitment Debt 10(f)(5) 25.500 25,500
Total Obligations Not Recorded
in Financial Statements $ 73,070 $ - $ (345) $ 72,725
{
c
c
t
t
57 t
t
• City of Huntington Beach
• Notes to Financial Statements
• = ., ,. For the Year Ended September 30, 2005
10.LONG-TERM OBLIGATIONS (Continued)
i
! f. Long-Term Obligations for which City is not Liable in any Manner
(1) Community Facilities District 1990-1 2001 Special Tax Refunding Bonds
Year of Issuance 2001
' Type of Debt Community Facilities District
Assessment Bonds
• Original Principal Amount $2,155,000
Security Special Tax Levies
Interest Rates 4.00% to 5.40%
Interest Payment Dates Aril 1 st and October 15
Principal Payment Dates October 15
•
• Debt service requirements to maturity are (in thousands):
•
i
i Year Ending Principal Interest Total
September 30
2006 $ - $ - $ -
0 2007 85 92 177
i 2008 90 88 178
2009 95 84 179
i 2010 95 80 175
2011-2015 565 321 886
i 2016-2020 730 149 879
• 2021 170 5 175
Total $ 1,830 $ 819 $ 2,649
•
i (2) Community Facilities District 2000-1 Special Tax Bonds
i
i Year of Issuance 2001
i Type of Debt Community Facilities District
Assessment Bonds
• Original Principal Amount $16,000,000
i Security Special Tax Levies
! Interest Rates 3.80% to 6.40%
Interest Payment Dates September 15 and March 15
• Principal Payment Dates September-PT'
i Purpose of Debt Public Improvements for Grand
• Coast Resort
! 58
0
(7)
City of Huntington Beach
Notes to Financial Statements
For the Year Ended September 30, 2005
10.LONG-TERM OBLIGATIONS (Continued)
f. Long-Term Obligations for which City is not Liable in any Manner
(2) Community Facilities District 2000-1 Special Tax Bonds
Debt service requirements to maturity are (in thousands):
Year Ending Principal Interest Total
September 30
2006 $ 365 $ 968 $ 1,233 f
2007 280 956 1,236
2008 295 943 1,238
2009 305 928 1,233
2010 325 912 1,237
2011-2015 1,915 4,265 6,180
2016-2020 2,590 3,592 6,182
2021-2025 3,535 2,644 6,179
2026-2030 4,830 1,347 6,177
2031 1,160 75 1,235
Total $ 15,500 $ 16,630 $ 32,130
(3) Community Facilities District 2002-1 Special Tax Bonds
Year of Issuance 2002
Type of Debt Community Facilities District
Assessment Bonds
Original Principal Amount $4,900,000
Security Special Tax Levies F
Interest Rates 3.80% to 6.20%
Interest Payment Dates March 1 S and September is'
Principal Payment Dates September 15
c
c
c
c
c
c
c
59
c
•
! City of Huntington Beach
• Notes to Financial Statements
! For the Year Ended September 30, 2005
10.LONG-TERM OBLIGATIONS (Continued)
•
f. Long-Term Obligations for which City is not Liable in any Manner
! (3) Community Facilities District 2002-1 Special Tax Bonds
•
Debt service requirements to maturity are (in thousands):
i Year Ending Principal Interest Total
September 30
! 2006 $ 10 $ 299 $ 309
2007 15 298 313
• 2008 25 298 323
2009 30 296 326
40 2010 40 295 335
0 2011-2015 340 1,435 1,775
0 2016-2020 650 1,309 1,959
0 2021-2025 1,105 1,062 2,167
2026-2030 1,745 642 2,387
2031-2032 935 89 1,024
Total $ 4,895 $ 6,023 $ 10,918
(4) Community Facilities District 2003-1 Special Tax Bonds
Year of Issuance 2003
• Type of Debt Community Facilities District
Assessment Bonds
• Original Principal Amount $25,000,000
Security Special Tax Levies
! Interest Rates 2.65% to 5.85%
• Interest Payment Dates March 1st and September 15
• Principal Payment Dates Sept mber 1 S
•
•
•
•
•
•
•
. 60
r
City of Huntington Beach
Notes to Financial Statements
- For the Year Ended September 30, 2005
10.LONG-TERM OBLIGATIONS (Continued)
f. Long-Term Obligations for which City is not Liable in any Manner
(4) Community Facilities District 2003-1 Special Tax Bonds
Debt service requirements to maturity are (in thousands):
Year Ending Principal Interest Total
September 30
2006 $ 440 $ 1,366 $ 1,806
2007 450 1,354 1,804
2008 465 1,340 1,805
2009 485 1,323 1,808
2010 500 1,305 1,805
2011-2015 2,855 6,172 9,027
2016-2020 3,670 5,363 9,033
2021-2025 4,850 4,180 9,030
2026-2030 6,445 2,589 9,034
2031-2032 4,840 577 5,417
Total $ 25,000 $ 25,569 $ 50,569
(5) No-Commitment Debt
The City is involved in various bond issues where the City or Redevelopment Agency
issued bonds to assist in the financing of residential developments. A trustee holds all t
funds and payment cannot be made from any other source than the mortgages f
received. t
These bond issues are (in thousands): t
t
Outstanding t
September 30, Original Issue
Bond Issue 2005 Amount
Five Points Senior Project Multi-Family
Housing Revenue Bonds - Series A - 1991 $9,500 $9,500 t
Huntington Breakers Mortgage Revenue Bonds
Refunding Issue - 1996 Series A $16,000 $16,000 t
t
t
t
t
61 1
t
t
• i •
0 City of Huntington Beach
. �/ Notes to Financial Statements
• �, For the Year Ended September 30, 2005
• 11.CAPITAL ASSETS
•
a. Changes in Capital Assets
•
• Capital asset activity for the year was (in thousands):
•
October 1, September
2004 Additions Dispositions 30, 2005
Governmental Activities:
• Capital Assets, Not Depreciated:
Land $ 323,714 $11,058 $ (136) $ 334,636
Construction in Progress 12,992 - (12,992) -
Joint Ventures 1,339 - (18) 1,321
Total Capital Assets -Not Depreciated 338,045 11,058 (13,146) 335,957
Capital Assets Being Depreciated
Buildings 114,893 12,426 (81) 127,238
• Machinery and Equipment 52,679 5,026 (3,429) 54,276
. Infrastructure 280,624 19,832 - 300,456
Total Capital Assets Being Depreciated 448,196 37,284 _ (3,510)_ 481,970
• Less Accumulated Depreciation:
. Buildings (26,078) (1,595) 15 (27,658)
Machinery and Equipment (35,863) (2,558) 2,590 (35,831)
0 Infrastructure (146,995) (5,594) - (152,589)
• Total Accumulated Depreciation (208,936) (9,747) 2,605 (216,078)
Total Depreciated - Net 239,260 27,537 (905) 265,892
• Total Capital Assets 786,241 48,342 (16,656) 817,927
• Total Accumulated Depreciation (208,936) (9,747) 2,605 (216,078)
Capital Assets of Governmental Activities- Net
of Accumulated Depreciation $ 577,305 $38,595 $ (14,051) $ 601,849
•
•
.
•
•
•
•
•
•
•
•
62
0
City of Huntington Beach
Notes to Financial Statements t
. For the Year Ended September 30, 2005
11.CAPITAL ASSETS (Continued)
a. Changes in Capital Assets
C
October 1, September
2004 Additions Dis ositions 30 2005
Business Activities: f
Capital Assets, Not Depreciated:
Land $ 7,840 $ - $ - $ 7,840
Construction in Progress 8,070 - (6,881) 1,189
Total Capital Assets -Not Depreciated 15,910 - (6,881) 9,029 {
Capital Assets Being Depreciated
Buildings 38,401 8,535 (11) 46,925 t`
Machinery and Equipment 10,577 361 (703) 10,235
Infrastructure 90,371 10,108 (237) 100,242
Total Capital Assets Being Depreciated 139,349 19,004 (951) 157,402 f
Less Accumulated Depreciation:
Buildings (8,000) (712) 10 (8,702)
Machinery and Equipment (4,137) (505) 595 (4,047)
Infrastructure (50,049) (1,674) 221 (51,502) f
Total Accumulated Depreciation (62,186) (2,891) 826 (64,251)
Total Depreciated - Net 77,163 16,260 (272� 93,151
Total Capital Assets 155,259 19,004 (7,832) 166,431
Total Accumulated Depreciation 62,186 2,891 826 64,251
Capital Assets of Governmental Activities- Net r~
of Accumulated Depreciation $ 93,073 $ 16,113 $ 7,006 $ 102,180
b. Depreciation Expense
Depreciation in governmental activities was charged to the following functionslprograms in
the Statement of Activities (in thousands):
t
Department: {
City Administrator $ 29
City Treasurer 5
City Attorney 4
City Clerk 3
Administrative Services 4 C
Planning 10
Building 30
Fire 574
Information Systems 880
Police 465
Economic Development 1
Community Services 1,010
Library Services 345
Public Works 6,184 {
Non-Departmental 203
Total $ 9,747 {
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0 City of Huntington Beach
• 'ram,;. Notes to Financial Statements
§, For the Year Ended September 30, 2005
~ 11.CAPITAL ASSETS (Continued)
•
• b. Depreciation Expense
•
Depreciation in business activities was charged to the following functions/programs in the
Statement of Activities (in thousands):
•
• Water $ 1,782
Sewer Service 798
• Emerald Cove 82
• Fire Medical Program 218
Ocean View Estates 11
Total $ 2,891
c. Capital Assets Acquired via Capital Leases
• At year-end the City's assets acquired through outstanding capital leases (see note 11)
were (in thousands):
• Governmental Business-Type
• Activities Activities
Machinery and Equipment $ 4,104 $ 479
Less: Accumulated Depreciation (2,065) (192)
Total $ 2,039 $ 288
•
12.COMMITMENTS AND CONTINGENCIES
• a. Legal Actions
•
There are legal actions pending against the City resulting from normal operations. In the
opinion of management and the City Attorney, the financial resolution of these actions
• should not have a significant impact on these financial statements.
i
b. Huntington Beach Union High School District (HBUHSD) Sharing Agreement
In 1997 the City Council agreed to pay the HBUHSD certain increased sales tax revenues
• relating to the development of a new commercial site by Home Depot. The City will retain
the first $50,000 of annual increased sales tax revenues and will pay HBUHSD a portion
of the amount over $50,000 until the year 2015/2016.
•
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City of Huntington Beach t
r- Notes to Financial Statements
For the Year Ended September 30, 2005
r� f
12.COMMITIVIENTS AND CONTINGENCIES (Continued)
c. Disposition and Development and Owner Participation Agreements
In June 1999, the Redevelopment Agency entered into a disposition and development
agreement with the CIM Group, LLC to allow development of a hotel, retail and restaurant
improvements and a public parking facility.The project costs are to be paid initially by the
developer with the Agency reimbursing the developer maximum of$7.9 million pursuant
to a Third Implementation Agreement approved on October 21, 2002.
The Redevelopment Agency entered into a Disposition and Development Agreement with
a private developer regarding the development of the Huntington Center Mall. This
agreement will require payments by the Agency pending certain actions by the developer.
At year-end, no Agency liability had been incurred. f
fi
On January 2, 2002 the Redevelopment Agency entered into an Owner Participation
Agreement with Fountains Huntington Beach, LLC, to provide $2 million to meet the cost
of providing and maintaining 80 affordable housing units for a period of 60 years. At year-
end no liability had been incurred.
On 912103 the Redevelopment Agency Approved a Cooperation Agreement Regarding
Capital Improvements in the Southeast Coastal Redevelopment Project with the City.
This agreement commits the Redevelopment Agency to reimburse the City for a number
of capital improvement projects to be undertaken as part of the Five Year Capital
Improvement Program in the Southeast Redevelopment project area starting in FY
2003/04 as they are undertaken. C
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d. Redevelopment Agency Debt to City
The City has advanced money to the Redevelopment Agency for capital improvements t
and operations. There is no fixed repayment schedule for these advances and the
Council/Agency has no requirement for the timing of any repayment. Accordingly, the City
has not recorded the advances in the accompanying financial statements. These
advances have been made since 1984 and include direct advances of cash, overhead {
charges, deferred development fees, deferred land sales, and interest. {
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City of Huntington Beach
• Notes to Financial Statements
• For the Year Ended September 30, 2005
•
• 12.COMMITMENTS AND CONTINGENCIES (Continued)
•
• d. Redevelopment Agency Debt to City
•
• Below is a schedule of the activity for the year (in thousands):
• Amount @ Amount
10/1104 Reductions Additions 1 9130/05
General Fund
! Direct Advances $ 4,598 $ (1,032) $ 200 $ 3,766
Overhead Charges 6,567 - - 6,567
• Land Sales 32,833 - - 32,833
Interest 36,002 (3,893) 2,259 34,368
Total General Fund 80,000 (4,925) 2,459 77,534
Sewer Fund
Direct Advances 131 - - 131
• Deferred Development Fees 79 (41) - 38
• Interest 138 - 51 189
. Total Sewer Fund 348 (41) 51 358
Drainage Fund
Direct Advances 250 - - 250
. Deferred Development Fees 54 - - 54
Interest 356 - 18 374
• Total Drainage Fund 660 - 18 678
Park Acquisition and Development Fund
Direct Advances 1,741 - - 1,741
• Deferred Development Fees 247 - - 247
• Interest 2,588 - 129 2,717
. Total Park Acquisition and Development Fund 4,576 - 129 4,705
Capital Improvement Fund
• Direct Advances 200 - 270 470
• interest 295 - 20 315
Total Capital Improvement Fund 495 - 290 785
• Water Fund
Direct Advances 1,138 - - 1,138
Interest 2,067 - 90 2,157
! Total Water Fund 3,205 - 90 3,295
Total All Funds $ 89,284 $ (4,966) $ 3,037 $ 87,355
•
The cash repayments are recorded as transfers from the Redevelopment Agency to the
fund receiving the repayment.
•
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• 66
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City of Huntington Beach f
r Notes to Financial Statements
C
- For the Year Ended September 30, 2005
1
13.OTHER INFORMATION
a. Expenditures Exceeding Appropriations
Expenditures exceeded appropriations at the departmental level in the funds shown (in
thousands):
f
General Fund:
Fire $ 801
Debt Service Principal 804
Other Major Funds:
Grants - Public Works 3
Redevelopment Agency- Non Departmental 170
Redevelopment Agency-Debt Service Principal 812
Redevelopment Agency- Debt Service Interest 929
b. Fund and Accumulated Deficits
The Drainage Fund had total fund deficit of $870,000 at year-end. It will be eliminated
through monitoring of expenditures.
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City of Huntington Beach
Required Supplementary Information
For the Year Ended September 30, 2005
r�
Budgetary Information
The City Council must annually adopt a budget by September 30 of the prior fiscal year. The
budgeted expenditures become the appropriations to the various departments. The budget includes
estimates for revenue that, along with the appropriations, compute the budgetary fund balance. The
appropriated budget covers substantially all governmental fund expenditures with the exception of
capital improvement projects (capital projects funds) carried forward from prior years, which
constitute a legally authorized non-appropriated budget. The City Council may amend the budget at C
any time. The City Administrator may transfer funds between object purposes (personal services,
operating expenditures or capital outlay expenditures)within the same department without changing
the total departmental budget. The City Administrator may also transfer appropriated monies between
different departments within the same fund without changing the total budget of that fund.
Department heads may transfer funds from like object categories of the same department. The City
Council must approve any changes to departmental budgets. Expenditures may not exceed
appropriations at the departmental level. All unused appropriations lapse at year-end. During the year
the City Council made several supplemental appropriations, which included carryovers of prior year
encumbrances all of which were within available fund balance and estimated revenue amounts.
The City Council adopts governmental fund budgets consistent with generally accepted principles as
legally required. There are no significant non-budgeted financial activities. Revenues for special
revenue funds are budgeted by entitlements, grants and estimates of future development and
economic growth. Expenditures and transfers are budgeted based upon available financial resources.
On or before May 31 of each year, each department submits data to the City Administrator for budget
preparation. Staff prepares the budget by fund,function and activity. The budget includes information
on past years, current year estimates and requested appropriations for the next fiscal year. Before
August 1, the City Council receives the proposed budget.The City Council holds public hearings and C
may amend the budget by a majority vote. Changes to the budget must be within the available
revenues and reserves.
C
These financial statements show budgetary data for the General, Special Revenue, Capital Projects
and Debt Service Funds. The original budget, revised budget, actual expenditures, and variance
amounts are shown.
The City uses an encumbrance system as an aid in controlling expenditures.When the City issues a
purchase order for goods or services, it records an encumbrance until the vendor delivers the goods C
or performs the service. At year-end, the City reports all outstanding encumbrances as reservations
of fund balance in governmental fund types. The City reappropriates these encumbrances into the
new fiscal year.
f
Below is a schedule of a budget to actual comparison of the General and Grant Fund's Revenues,
and Expenditures (in thousands):
fi
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CITY OF HUNTINGTON BEACH
• SCHEDULE OF REVENUES,EXPENDITURES AND
CHANGES IN FUND BALANCES-BUDGET AND ACTUAL
FOR THE YEAR ENDED SEPTEMBER 30,2005
(In Thousands)
General Fund
' REVENUES: Original Budget Final Budget Actual Variance
• Property Taxes $49,870 $49,87o $48.119 $ (1,751)
• Sales Taxes 21,464 21,464 22,122 658
Utility Taxes 19,564 19,564 20,004 440
Other Taxes 9,776 9,776 13,068 3,292
. Licenses and Permits 6,851 6,851 7,432 581
a Fines, Forfeitures and Penalties 5,110 5,110 4,365 (745)
From Use of Money and Property 8,305 8,305 9,736 1,431
From Other Agencies 5,579 5,579 9,672 4,093
• Charges for Current Service 7,032 7,032 7,419 387
Other 3,693 3,693 7,416 3,723
• TOTAL REVENUES 137,244 137,244 149,353 12,109
• EXPENDITURES:
Current:
• City Council 254 280 254 26
• City Administrator 1,334 2,034 1,582 452
City Treasurer 1,699 1,709 1,547 162
City Attorney 3,250 3,289 2,771 518
City Clerk 858 $55 679 176
. Administrative Services 7,928 7,002 5,731 1,271
Finance 2,903 2,765 2,501 264
Planning 2,825 2,884 2,403 481
Building 3,535 3,529 3,291 238
Fire 21,271 21,221 22,022 (801)
• Information Services 9,887 9,215 5,726 3,489
• Police 46,566 47,014 45,466 1,548
Economic Development 1,699 1,375 776 599
Community Services 11,789 12,040 11,030 1,010
• Library Services 2,771 2,794 2,707 87
. Public Works 20,859 20,837 19,124 1,713
Non-Departmental 14,6W 13,871 12,145 1,726
Debt Service:
. Principal 1,443 1,249 2,053 (804)
Interest _ 194 194 -
• TOTAL EXPENDITURES 155,701 154,157 142,002 12,155
EXCESS OF REVENUES OVER(UNDER)
EXPENDITURES (18,457) (16,913) 7,351 24,264
OTHER FINANCING SOURCES(USES):
• Transfers In 11,517 11,517 11,873 356
• Proceeds of Long-Term Debt 342 342
Transfers Out (6,628) (7,000) (7,612) (612)
• TOTAL OTHER FINANCING SOURCES(USES) 4,889 4,517 4,603 86
. EXCESS OF REVENUES AND OTHER SOURCES OVER
(UNDER)EXPENDITURES AND OTHER USES (13,568) (12,396) 11,954 24,350
FUND BALANCE-BEGINNING OF YEAR 26,332 26,332 26,332 -
FUND BALANCE-END OF YEAR $ 12,764 $ 13,936 $ 38,286 $ 24,350 69
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�✓ stl fie./ �/ �c./ V./ 1LJ r4.J �fJ �C.! �4.J �.I \/ KJ 'E./ y.l �k/ � V„! �J Wv `t/ w✓ �4J �L./ � v � v v v �c-+ �c.f v v �.+ v v v v v v v
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CITY OF HUNTINGTON BEACH
COMBINING SCHEDULE OF REVENUES,EXPENDITURES,AND
CHANGES IN FUND BALANCES-BUDGET AND ACTUAL
FOR THE YEAR ENDED SEPTEMBER 30,2005
(In Thousands)
• Grants
REVENUES: Original Budget Final Budget Actual Variance
. From Use of Money and Property $ 375 $ 375 $ 553 $ 178
From Other Agencies 12,561 12,561 5,649 (6,912)
• Other 12 12 14 2
TOTAL REVENUES 12,948 12,948 6,216 (6,732)
EXPENDITURES:
. Current:
Planning 329 169 145 24
Fire 260 828 343 485
Police 500 580 247 333
Economic Development 3,223 3,683 947 2,736
. Community Services 330 453 322 131
Library Services 116 174 144 30
• Public Works 47 166 169 (3)
Capital Outlay 9,160 11,499 3,536 7,963
Debt Service:
. Principal 90 90 90 -
Interest 170 170 170 -
• TOTAL EXPENDITURES 14,225 17,812 6,113 11,699
EXCESS OF REVENUES OVER(UNDER)EXPENDITURES (1,277) (4,864) 103 4,967
OTHER FINANCING SOURCES(USES):
Transfers In 499 283 (216)
Proceeds of Long-Term Debt 105 105
Transfers Out 580 (1,323) (1,903)
TOTAL OTHER FINANCING SOURCES(USES) 1,079 (935) (2,014)
EXCESS OF REVENUES AND OTHER SOURCES OVER
(UNDER)EXPENDITURES AND OTHER USES (1,277) (3,785) (832) 2,953
FUND BALANCE-BEGINNING OF YEAR 5,115 5,115 5,115
FUND BALANCE-END OF YEAR $ 3,838 $ 1,330 $ 4,283 $ 2,953
71
CITY OF HUNIINGTON BEACH
REQUIRED SUPPLEMENTARY INFORMATION
FOR THE YEAR ENDED SEPTEMBER 30,2005
SCHEDULE OF FUNDING PROGRESS
RETIREMENT PLAN-NORMAL
(In Thousands)
Entry Age
[Normal Excess Assets
Actuarial as a
Accrued Actuarial Excess Assets Percentage of f
Liability Value of (Unfunded Covered Covered
Actuarial Valuation Date (AAL) Assets Liability) Funded Ratio Payroll Payroll
2001
Safey $ 283,438 $ 295,290 $ 11,942 104.2% S 27,717 42.7°/u
Non Safety 177,467 237,108 59,641 133.6% 35,985 165.7%
Total $ 460,905 $ 532,388 $ 71,483 115.5% $ 63,702 112.2%
2002
Safety $299,052 $272367 $ (26,685) 91.1% $ 23,270 (114.7%)
Non Safety 191,997 223,364 31,367 116.3% 37,911 83.0%
Total $ 491,049 $ 495,731 $ 4,682 101.0% S 61,081 7.7%
2003 l
Safety $ 320,670 $ 270,538 $ (50,132) 84.4°/u $ 28,919 (173.4%)
Non Safety 222,221 225,689 3,468 101.6% 36,919 9.4%
Total $ 542,891 $ 496,227 $ (46,664) 91.4% S 65,837 (70.9%)
2004
Safety $ 339,301 $ 280,745 $ (58,556) 104.2% $ 27,412 (213.6%)
Non Safety 234,602 236,189 1,597 100.7% 36,143 4A%
Total $ 573,903 S 516,934 $ (56,969) 115.5% $ 63,555 (89,6%)
CITY OF HUNTINGTON BEACH
REQUIRED SUPPLEMENTARY INFORMATION
FOR THE YEAR ENDED SEPTEMBER 30,2005
SCHEDULE OF FUNDING PROGRESS
RETIREMENT PLAN-SUPPLEMENTAL {
(In Thousands) t
Entry Age {
Normal Actuarial Unfunded UAAL as a%
Accrued Value of AAL Covered of Covered
Actuarial Valuation Date Liability Assets (UAAL) Funded Ratio Payroll Payroll
6/30/95 Update 15,77( -29 16,0 1.8% 51,77 -31.U% t
0/30/96 Actual 16,071 -12 -16,1911 0.7% 54,368 -29.8%
6/30/1997Actual 25,342 2,33 -23,00 -10.1% 49,881 -46,1%
6/30/98 Update 26,493 3,251 -23,24 14.U°/n 48,585 -47.8%
6/30/99Actual 28,601 4,16 -24,439 17A% 50,723 48.2% t
6/30/2000 Update 28,W 5,07 23,76 -21.40N, 57,67 -41.2%
6/30/2001 Actual 36,453 6,67 -29,77 -22.4% 63,345 -47.0% t
6/30/2002 Update 35,524 8,775 -26,74 -32.8% 65,13 -41.1%
6/30/2003 Actual 40,436 10,47 -29,96 -35.0% 65,22 -45.91.
6/30/2004 Update 40,979 11193 -29,04 -41.1% 63,53 -45.7%
6/30/2005 Acuual 40,873 14,22 -26,646 -53.4% 65,843 -40.5% 72
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Non-Major Governmental Funds
Special Revenue Funds account for revenues and expenditures legally restricted to a specific purpose.
• The Gas Tax Fund accounts for moneys allocated under the Streets and Highways Code of California.
Expenditures may be made for any street-related purpose allowed under the code.
• The Drainage Fund accounts forfees received from developers to construct and maintain the City's drainage
system.
The Narcotics Forfeiture Fund accounts for moneys received from the State of California for special law
• enforcement expenditures.
• The Transportation Fund accounts for moneys received from the countywide '/2 cent sales tax and other
. specific sources to be spent on transportation-related expenditures.
• The Air Quality Fund accounts for revenues from the local agencies used to improve local air quality.
• The Traffic Impact Fee Fund accounts for moneys received from the traffic impact fee levied on new
developments in the City.
• The Fourth of July Parade Fund accounts for the activities of the City's annual parade.
• The Special Library Fund accounts for revenues and expenditures related to the expanded Central Library
1♦ including some construction.
• The Cultural Affairs Fund accounts revenues and expenditures associated with the City's Art Center.
• The Park Acquisition and Development Fund accounts for fees received from developers to develop and
maintain the City's park system.
Debt Service Funds account for the receipts for and payment of general long-term debt.
• • The Reservoir Hill Fund records the debt service activity of the Reservoir Hill Assessment bonds.
• The Property Propeyy Tax Refund Fund records the payment of claims for the Jarvis Tax Case and debt for the
• Judgment Obligation Bonds.
Capital Projects Funds account for the acquisition and construction of capital assets other than those financed by
proprietary fund types.
• 0 The Holly Seacliff Fund accounts for capital improvements made to the Holly Seacliff area.
• The Parking In-lieu Fund records construction activity from developers who pay fees in-lieu of directly
• providing parking facilities to the City
• The Sewer Development Fund accounts forfees received from developers to construct and maintain sewer
• facilities.
` • The Infrastructure Fund records activity for certain designated infrastructure related expenditures.
73
M
CITY OF HUNTINGTON BEACH
BALANCE SHEET
NON-MAJOR GOVERNMENTAL FUNDS
S85TEMBER 30,M05
(In Thousands)
SPECIAL REVENUE FUNDS
Narootics
ASSETS: Gas Tax Drainage Forfeihae Transportation Ai r Quaf ity
Cash and Investments $ 6,595 $ $ 608 $ 5,390 $ 698
Other Receivables 850 7 412 6
Due from Other Funds 863 - - -
Other Assets - - - -
TOTAL ASSETS 8,308 615 5,802 704
LIABILITIES AND FUND BALANCES
UABIUTIES:
Aocaunts Payable 192 7 551
Accrued Payroll 6 - 11
Due to Other Funds - 863 - -
Advvances from Other Funds - - - -
Deposits Payabe - - - - f
TOTAL UA8IUTIES 199 870 - 562 -
FUND BALANCES:
Reserved for:
Eroxnbrances 1,858 - 1 3,892 5
Total Reserved Fund Balances 1,858 - 1 3,892 5
Unreserved Fund Balances
Unreserved,Designated for Future E)pendtures 4,611 29 - 5
Undesignated 1,641 (87m) 585 1,348 694
Total Unreserved Fund Balance 6,2 2 (870) 614 1,348 699
TOTAL FUND BALANCES 8,110 (870] 615 5,240 704 f
TOTAL UABIUTES AND FUND BALANCES $ 8,308 $ - $ fi15 $ 5,802 $ 704
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• SPECIAL REVENUE FUNDS
•
Park Acquisition
and Total Special
• Traffic Impact Fourth of July Special Library Cultural Affairs Development Revenue Funds
$ 8,940 $ 129 $ 1,126 $ 137 $ 6,251 $ 29,874
72 2 9 118 1,476
863- - - --
1,294 1,294
• 9,012 131 1,135 137 7,663 33,507
i
25 11 18 9 102 915
• 2 - 8 4 3 34
. - _ - - 863
1,836 1,836
- - - 1,294 1,294
• 27 11 26 13 3,235 4,942
• 1,125 9 18 10 3,814 10,732
1,125 9 18 10 3,814 10,732
i 4,068 - 518 - 614 9,845
3,792 111 573 114 - 7,988
• 7,860 111 1,091 114 614 17,833
8,985 120 1,109 124 4,428 28,565
• $ 9,012 $ 131 $ 1,135 $ 137 $ 7,663 $ 33,507
•
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• Speaat Revenue Funds
• Park Acquisiton
. and Total Special
Traffic Impact Fourth of July Special Ubrary Cultural Affairs Development lRevenueFunds
• $ $ - $ $ $ $ 2,218
• 11 - 11
179 27 427 8 58 1,049
• - - - - 515 4,754
1,706 152 650 200 1,088 3,824
179 97 46 75 401
1,896 358 1,174 254 1,736 IIZ257
•
• 65
321 371 277 969
• - - 1,118 - 1,118
137 - - - 2,222
• 397 117 3,510
• - - 39
• - - 5
• 534 321 1,118 371 394 7,928
1,362 37 56 (117) 1,342 4,329
• 23 - - 105 580 1,610
• (12) (55) (465) - - (1,551)
11 (55) (465) 105 580 59
• 1,373 (18) (409) (12) 1,922 4,388
• 7,612 138 1,518 136 2,506 24,177
• $ 4985 $ 120 $ 1,109 $ 124 $ 4,428 $ 28,565
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FranUecfMyWadTeay $ 112 $ 112 $ 199 $ 97
Frcmchwpwues 3�40p 4W 2�945 545
Ctl-ff - - 2 2
TOTAL FEVE LE5 3s512 a5y 4146 634
arre t:
PL6CWTis 46ED 46EE) 1,596 :�09'I
Q4id aft 73B 73B ZY 511
IUFALEXPEN]7LF;EB w 4427 1825 4602
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RMEPLEt,EE-UDCFYEAR $ a13I4 $ 3,674 $ 4110 $ 4,M
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RJ�DBoLF -�GFY6oFi $ (7q $ (746 $ (I3M $ (1�1
82
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. CITY OF HUNTINGTON BEACH
SCHEDULE OF REVENUES,EXPENDITURES,AND
CHANGES IN FUND BALANCES-BUDGET AND ACTUAL
NON-MAJOR GOVERNMENTAL FUNDS
FOR THE YEAR ENDED SEPTEMBER 30,2005
(In Thousands)
(continued)
i
• Narcotics Forfeiture
REVENUES: Original Budget Final Budget Actual Variance
• From Use of Money and Property $ 15 $ 15 $ 17 $ 3
From Other Agencies 163 163 52 (111)
TOTAL REVENUES 178 178 69 (109)
• EXPENDITURES:
Current:
Police 123 123 65 58
• Capital Outlay 133 133 37 96
Debt Service:
Principal 39 39 39 -
• Interest 5 5 5 -
TOTAL EXPENDITURES 300 300 146 154
OTHER FINANCING SOURCES(USES):
Transfers In 212 212 212 -
• Transfers Out (119) (119) (119) -
. TOTAL OTHER FINANCING SOURCES(USES) 93 93 93 -
EXCESS OF REVENUES AND OTHER SOURCES
OVER(UNDER)EXPENDITURES AND OTHER USES (29) (29) 16 (263)
FUND BALANCE-BEGINNING OF YEAR 599 599 599 -
FUND BALANCE-END OF YEAR $ 570 $ 570 $ 615 $ (263)
f
r Transportation
•
• REVENUES: Original Budget Final Budget Actual Variance
Sales Taxes $ 2,200 $ 2,200 $ 2,218 $ 18
From Use of Money and Property 80 80 122 42
. Other - - 2 2
TOTAL REVENUES Z280 Z280 2,342 62
i EXPENDITURES:
• Current:
Public Works 1,027 1,028 448 580
. Capital Outlay 6,451 6,243 2,726 3,517
TOTAL EXPENDITURES 7,478 7,271 3,174 4,097
• EXCESS OF REVENUES OVER(UNDER)
• EXPENDITURES (5,198) (4,991) (832) 4,159
OTHER FINANCING SOURCES(USES):
i Transfers In 690 690
' EXCESS OF REVENUES AND OTHER SOURCES
OVER(UNDER)EXPENDITURES AND OTHER USES (5,198) (4,301) (142) 4,159
FUND BALANCE-BEGINNING OF YEAR 5,382 5,382 5,382 -
FUND BALANCE-END OF YEAR $ 194 $ 1,081 $ 5,240 $ 4,159
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CITY OF HUNTINGTON BEACH
SCHEDULE OF REVENUES,EXPENDITURES,AND �c
CHANGES IN FUND BALANCES-BUDGET AND ACTUAL
NON-MAJOR GOVERNMENTAL FUNDS
FOR THE YEAR ENDED SEPTEMBER 30,2005
(In Thousands)
(continued)
Air Quality
REVENUES: Original Budget Final Budget Actual Variance `
From Use of Money and Property $ 6 $ 6 $ 12 $ 6
From Other Agencies 220 220 242 22
Other 1 1 - (1)
TOTAL REVENUES 227 227 254 27
EXPENDITURES:
Current: {
Public Works 148 148 39 109
Capital Outlay 23 23 6 17
TOTAL EXPENDITURES 171 171 45 126
EXCESS OF REVENUES OVER(UNDER)
EXPENDITURES 56 56 209 153
OTHER FINANCING SOURCES(USES):
Transfers Out (200) (200) - 200
EXCESS OF REVENUES AND OTHER SOURCES OVER
(UNDER)EXPENDITURES AND OTHER USES (144) (144) 209 353
FUND BALANCE-BEGINNING OF YEAR 495 495 495 -
FUND BALANCE-END OF YEAR $ 351 $ 351 $ 704 $ 353 ,e
Traffic Impact
REVENUES: Original Budget Final Budget Actual Variance
Licenses and Permits $ - $ - $ 11 $ 11
From Use of Money and Property 151 151 179 28
Charges for Current Service 950 950 1,706 756
TOTAL REVENUES 1,141 1,101 1,896 796
EXPENDITURES:
Current:
Public Works 463 758 137 621
Capital Outlay 5,049 4,961 397 4,564
TOTAL EXPENDITURES 5,512 .5,719 534 5,185
EXCESS OF REVENUES OVER(UNDER)
EXPENDITURES (4,411) (4,618) 1,362 5,980
OTHER FINANCING SOURCES(USES):
Transfers In 150 150 23 (127)
Transfers Out (110) (110) (12) 98
TOTAL OTHER FINANCING SOURCES(USES) 40 11 (29)
EXCESS OF REVENUES AND OTHER SOURCES OVER f"
(UNDER)EXPENDITURES AND OTHER USES (4,411) (4,578) 1,373 5,951
FUND BALANCE-BEGINNING OF YEAR 7,612 7,612 7,612 -
FUND BALANCE-END OF YEAR $ 3,201 $ 3,034 $ 8,985 $ 5,951
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•
CITY OF HUNTINGTON BEACH
. SCHEDULE OF REVENUES,EXPENDITURES,AND
CHANCES IN FUND BALANCES-BUDGET AND ACTUAL
NON-MAJOR GOVERNMENTAL FUNDS
. FOR THE YEAR ENDED SEPTEMBER 30,2005
(In Thousands)
• (oontinued)
• Fourth of July
•
REVENUES: Original Budget Final Budget Actual Variance
• From Use of Maley and Property $ 2 $ 2 $ 27 $ 25
Charges for Current Service - - 152 152
Other 260 260 179 (81)
• TOTAL REVENUES 262 262 358 %
EXPENDITURES:
• :
• CwTnuuity SeNoes 187 355 321 34
EXCESS OF REVENUES OVER(UNDER)
EXPENDITURES 75 (93) 37 129
OTHER FINANCING SOURCES(USES):
• Transfers Cut (55) (55) (55) -
. TOTAL OTHER FINANCING SOURCES(USES) (55) (55) (55) -
EXCESS OF REVENUES AND OTHER SOURCES
OVER(UNDER)EXPEND!TURES AND OTHER USES 75 (148) (18) 129
• FUND BALANCE-BEGINNING OF YEAR 138 138 138 -
FUND BALANCE-END OF YEAR $ 213 $ (10) $ 120 $ 129
•
. Special Library
. REVENUES: Original Budget Final Budget Actual Varianoe
From Use of Maley and Property $ 408 $ 408 $ 427 19
Charges for Current Swvice 860 850 650 (210)
Other 285 285 97 (188)
• TOTAL REVENUES 1,553 1,553 1,174 (379)
. EXPENDITURES:
CL rent:
• Library Services 1,312 1,271 1,118 153
. EXCESS OF REVENUES OVER(UNDER)
EXPENDITURES 241 282 56 (226)
Transfers Out (494) (494) (465) 29
. EXCESS OF REVENUES AND OTHER SOURCES
OVER(UNDER)EKPEfVDITURES AND OTHER USES (253) (212) (409) (197)
FUND BALANCE-BEG NNING OF YEAR 1,518 1,518 1,518 -
• FUND BALANCE-END OF YEAR $ 1,265 $ 1,306 $ 1,109 $ (197)
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CITY OF HUN INGTON BEACH
SCHEDULE OF REVENUES,EXPENDITURES,AND
CHANGES IN FUND BALANCES-BUDGETAND ACTUAL
NON-MAJOR GOVERNMENTAL FUNDS
FOR THE YEAR ENDED SEPTEMBER 30,2005
(In Thousands)
(continued)
Cultural Affairs
REVENUES: Original Budget Final Budget Actual Variance
From Use of Maley and Property $ 14 $ 14 $ 8 $ (6)
Charges for Current Service 135 135 2DD 65
Other 75 75 46 (29)
TOTAL REVENUES 224 224 254 30
EXPENDITURES:
Current:
Cw rnurWty Services 459 375 371 4
EXCESS OF REVENUES OVER(UNDER)
EXPENDITURES (235) (151) (117) 34
OTHER FINANCING SOURCES(USES):
Transfers In 85 85 105 20
EXCESS OF REVENUES AND OTHER SOURCES
OVER.(UNDER)EXPENDITURES AND OTHER USES (150) (66) (12) 54
FUND BALANCE-BEG NNING OF YEAR 136 136 136 -
FUND BALANCE-END OF YEAR $ (14) $ 70 $ 124 $ 54
Parts Acquisition and Development
REVENUES: Original Budget Final Budget Actual Varianoe
From Use of Money and Property . $ 49 $ 49 $ 58 $ 9
From Other Agencies 1,830 1,830 515 (1,315)
Charges for Current Service 536 536 1,088 552
Other 50 50 75 25
TOTAL REVENUES Z465 Z465 1,736 (729)
EXPENDITURES:
Current:
Community Services 930 775 277 498
Capdad Outlay 797 4,759 117 4,642 fi
TOTAL EXPMDITURES 1,7Z7 5,534 394 5,140
EXCESS OF REVENUES OVER(UNDER)
EXPENDITURES 738 (3,069) 1,342 4,411
OTHER FINANCING SOURCES(USES):
Transfers In 5w 580 580 -
EXCESS OF REVENUES AND OTHER SOURCES
OVER(UNDER)EXPENDITURES AND OTHER USES 1,318 (Z489) 1,922 A411
FUND BALANCE-BEGINNING OF YEAR Z506 Z506 Z506
FUND BALANCE-END OF YEAR $ 3,824 $ 17 $ 4,428 $ 4,411
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CITY OF HUNTINGTON BEACH
. SCHEDULE OF REVENUES,EXPENDITURES,AND
CHANGES IN FUND BALANCES-BUDGET AND ACTUAL
NON-MAJOR GOVERNMENTAL FUNDS
. FOR THE YEAR ENDED SEPTEMBER 30,2005
(In Thousands)
• (continued)
Property Tax Refund
• REVENUES: Original Budget Final Budget Actual Variance
From Use of Money and Properly $ 44 $ 44 $ 82 $ 38
EXPENDITURES:
Current:
• City Administrator 496 496 335 161
Non-Departmental 110 110 112 (2)
• Debt Service:
Principal 255 255 255 -
S Interest 394 394 425 (31)
. TOTAL EXPENDITURES 1,255 1,255 1,127 128
EXCESS OF REVENUES OVER(UNDER)
EXPENDITURES (1,211) (1,211) (1,045) 166
OTHER FINANCING SOURCES(USES): - -
Transfers In 598 598
EXCESS OF REVENUES AND OTHER SOURCES
i OVER(UNDER)EXPENDITURES AND OTHER USES (1,211) (1,211) (447) 764
FUND BALANCE-BEGINNING OF YEAR 4,369 4,369 4,369 -
• FUND BALANCE-END OF YEAR $ 3,158 $ 3,158 $ 3,922 $ 764
Capital Improvement
Original Budget Final Budget Actual Variance
OTHER FINANCING SOURCES(USES):
• Transfers Out $ - $ (359) $ (359) -
FUND BALANCE-BEGINNING OF YEAR 359 359 359 -
FUND BALANCE-END OF YEAR $ 359 $ - $ _ $ _
• Holly Seacliff
• REVENUES: Original Budget Final Budget Actual Variance
From Use of Money and Property $ 12 $ 12 $ 14 $ 2
• EXPENDITURES:
Capital Outlay 530 530 513 17
• EXCESS OF REVENUES OVER(UNDER)
i EXPENDITURES (518) (518) (499) 19
FUND BALANCE-BEGINNING OF YEAR 680 680 680 -
FUND BALANCE-END OF YEAR $ 162 $ 162 $ 181 $ 19
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CITY OF HUNTINGTON BEACH
SCHEDULE OF REVENUES,EXPENDITURES,AND
CHANGES IN FUND BALANCES-BUDGET AND ACTUAL
NON-MAJOR GOVERNMENTAL FUNDS
FOR THE YEAR ENDED SEPTEMBER 30,2005
(In Thousands)
(continued)
Parking in-Lieu
REVENUES: Original Budget Final Budget Actual Variance
From Use of Money and Property $ 11 $ 11 $ 48 $ 37
EXPENDITURES:
Current:
Economic Development 250 250 - 250
EXCESS OF REVENUES OVER(UNDER)
EXPENDITURES (239) (239) 48 (213)
FUND BALANCE-BEGINNING OF YEAR 333 333 333 -
FUND BALANCE-END OF YEAR $ 94 $ 94 $ 381 $ 286
Sewer Development �S
REVENUES: Original Budget Budget Actual Variance �s
Licenses and Permits $ $ $ 14 $ 14 `+
From Other Agencies 10 10
Charges for Current Service 200 200 127 (73)
Other - - 522 522
TOTAL REVENUES 200 200 673 473
EXPENDITURES:
Current:
Public Works - - 20 (20)
Capital Outlay 242 242 180 62
TOTAL EXPENDITURES 242 242 200 42
EXCESS OF REVENUES OVER(UNDER)
EXPENDITURES (42) (42) 473 515
FUND BALANCE-BEGINNING OF YEAR (108) (108) (108) -
FUND BALANCE-END OF YEAR $ (150) $ (150) $ 365 $ 515
I nfrastructure
Original Budget Budget Actual Variance
OTHER FINANCING SOURCES(USES):
Transfers In $ $ 65 $ 65 $
FUND BALANCE-BEGINNING OF YEAR - - -
FUND BALANCE-END OF YEAR $ _ $ 65 $ 65 $
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Non-Major Enterprise Funds
Enterprise Funds account for operations similar to private businesses. The City's intent is to recover the costs to the
general public through user charges or where the City wished to periodically determine net income.
• The Emerald Cove Housing Fund accounts for the operations of a senior-citizens apartment complex.
• The Emergency Fire Medical Fund accounts for the user-fee portion of the City's paramedic service.
• • The Hazmat Service Fund accounts for user fees charged for City's hazardous material program.
• The Ocean View Estates Fund accounts for the operation of the Ocean View Estates Mobile Home Park
• owned by the City
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CITY OF HUNTINGTON BEACH
COMBINING STATEMENT OF NET ASSETS
NON-MAJOR ENTERPRISE FUNDS
SEPTEMBER 30,2005
(In Thousands)
Emerald Cove Emergency Hazmat Ocean View
ASSETS Housing Fire Medical Service Estates Total
CURRENT ASSETS:
Cash and Investments $ 2,587 $ 1,469 $ 231 $ 1,313 $ 5,600
Other Receivables 21 1,164 18 10 1,213
TOTAL CURRENT ASSETS 2,608 2,633 249 1,323 6,813
CAPITAL ASSETS:
Land 1,289 - - 2,644 3,933
Buildings 4,102 - 560 4,662
Machinery and Equipment - 1,154 1,154
Less Accumulated Depreciation (1,641) (406) (67) (2,114)
TOTAL CAPITAL ASSETS 3,750 748 - 3,137 7,635
TOTAL ASSETS 6,358 3,381 249 4,460 14,448
LIABILITIES AND NET ASSETS
CURRENT LIABILITIES:
Accounts Payable 42 192 - - 234
Accrued Payroll - 52 3 1 56
Deposits Payable 58 1 - 10 69
TOTAL CURRENT LIABILITIES 100 245 3 11 359
NON-CURRENT LIABILITIES:
Compensated Absences - 84 10 - 94
TOTAL NON-CURRENT LIABILITIES - 84 10 - 94
TOTAL LIABILITIES 100 329 13 11 U
NET ASSETS:
Invested in Capital Assets, Net of Related Debt 3,750 748 - 3,137 7,635
Unrestricted 2,505 2,304 236 1,312 6,360
TOTAL NET ASSETS $ 6,258 $ 3,052 $ 236 $ 4,449 $ 13,995
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CITY OF HUMINGTON BEACH
• COMBINING STATEMENT OF REVENUES,EXPENSES
AND CHANGES I N NET ASSETS
NON-MAJOR ENTERPRISE FUNDS
. SEPTEVIBER30,2005
(In Thousands)
•
•
Emerald Cove Emergency Ooean View
. Housing Fire Medical Hazmat Service Estates Tow
OPEIRA7ING REVEM.IES:
• Rentals $ 866 $ - $ - $ 263 $ 1,129
Fees for Service - 5,725 110 - 5,835
• TOTAL OPERATING REVENUES 866 5,725 110 263 6,964
• OPERATING EXPENSES:
Supplies and Operations 317 5,279 141 1XT7 5,844
• Depredation 82 218 11 311
• TOTAL OPERATING EXPENSES 399 5,497 141 118 6,155
OPERATING INCOME(LOSS) 467 228 (31) 145 809
• NON-OPERATING REVENUES(EXPENSES):
Interest Income 52 13 7 37 109
• TOTAL NON-OPERA11 NG REVENUES(E)XPI-4SES) 52 13 7 37 109
• CHANGE IN NET ASSETS BEFORE OPERATING
TRANSFERS AND CAPITAL CONTR1BLMONS 519 241 (24) 182 918
TRANSFERS AND CAPITAL CONTRIBUTIONS:
Transfers In - 489 - - 489
Transfers Out (283) (181) (13) (477)
• TOTAL TRANSFERS AND CAPITAL CONTRIBUTIONS (283) 308 (13) - 12
TOTAL CHANGE IN NET ASSETS 236 549 (37) 182 930
NET ASSETS-BEGINNING OFYEAR 6,022 2,503 273 4,267 13,065
• NET ASSETS-Elm OF YEAR $ 4258 $ 3,052 $ 236 $ 4,449 $ 13,995
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CITY OF HUNTINGTON BEACH
STATEMENT OF CASH FLOWS
NON-MAJOR ENTERPRISE FUNDS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2005
(In Thousands)
Emerald
Cove Emergency Hazmat Ocean Ye
Housing Fire Medical Service Estates Total
Cash Flows from Operating Activities:
Cash Received from Customers and Users $ 864 $ 5,914 $ 106 $ 266 $ 7,150
Cash Paid to Employees for Services - (2,818) (17) (108) (2,943)
Cash Paid to Suppliers of Goods and Services (275) (2,330) (133) - (2,738)
Net Cash Provided(Used)by Operating Activities 589 766 (44) 158 1,469
Cash Flows from Noncapital Financing Activities:
Transfers In - 489 - - 489
Transfers Out (283) (181) (13) (477)
Net Cash Provided(Used)by Non Capital Financing Activities (283) 308 (13) - 12 (`
Cash Flows from Capital and Related Financing Activities:
Purchase of Plant, Property,and Equipment - (235) - - (235)
Activities - (235) - - (235)
Cash Flows from Investing Activities
Cash Received from Investments 52 13 7 37 109
Net Increase(Decrease)in Cash and Cash Equivalents 358 852 (50) 195 1,355
Cash and Cash Equivalents-Beginning of Year 2,229 617 281 1,118 4,245
Cash and Cash Equivalents-End of Year $ 2,587 $ 1,469 $ 231 $ 1,313 $ 5,600
Reconciliation of Operating Income to Net Cash provided
(used)by Operating Activities
Operating Income(Loss) $ 467 $ 228 $ (31) $ 145 $ 809
Adjustments to Reconcile Operating income to Net Cash
Provided(Used)by Operating Activities
Depreciation 82 218 - 11 311 t
Decrease(Increase)in Accounts Receivable (11) 249 (4) (8) 226 {
Increase(Decrease)in Accounts Payable 42 69 - - 111
Increase(Decrease)in Accrued Payroll - 10 - - 10
Increase(Decrease)in Deposits 9 - - 10 19
Increase(Decrease)in Compensated Absences - (8) (9) - (17)
Net Cash Provided(Used)by Operating Activities $ 589 $ 766 $ (44) $ 158 $ 1,469
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Fiduciary Funds
•
Fiduciary Funds account for assets held by the City as an agent for other organizations or individuals.
• The General Deposit Fund accounts for the deposit of general monies held by the City for private individuals
and business
The Community Facilities Districts Fund accounts for the debt service activity of the City's community
facilities district
The Huntington Beach Auto Business Improvement District Fund accounts forthe activities of the City's
business improvement district.
• The Central Net Fund accounts for the activity of the Central Net Operations Authority.
• The Retiree Medical Insurance Fund accounts for the City's medical retirement program.
•
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CITY OF HUNl1NGTON BEACH
STATEMB14T OF FIDUCIARY FUND NEC ASSETS
R DUCIARY FUNDS
SEPTEMBER 30,2006
Agency Funds
Business Central Net Retiree
Community lmprovemerd Operations Medical Total Agency
Assets: General Deposit Facilities Districts Districts Authority Insurance Funds
Cash and Investments-Local
Agency Imestnent Fund $ 2,010 $ 950 $ 103 $ 1,674 $ 4,795 $ 9,533
Cash with Fiscal Agent - 8,318 - - - 8,318
Ards Receivable,Net 402 17 12 38 469
Total Assets Z010 9,670 120 1,686 4,834 18,320
Liabilities:
Accounts Payable - - - 6 6
Due to Bondholders - 9,670 - - 9,670
Held for others 2,010 - 120 1,686 4,828 8,644
Total Liabilities $ 2,010 $ 9,670 $ 120 $ 1,686 $ 4,834 $ 18,320
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• Statistical Section
•
• This part of the City of Huntington Beach's Comprehensive Annual Report provides detailed
. information to better understand the data presented within the financial statements, note
disclosures, and required supplementary information.
•
Financial Trends
• Contain trend information to aid the reader understand how the City's financial performance
has changed over time
Revenue Capacity
• Contain information to help the reader assess the City's most significant local revenue
source, the property tax
• Debt Capacity
Present information to assess the affordability of the City's current levels of outstanding debt
• and the City's ability to issue additional debt in the future
• Demographic and Economic Information
Offers information to help the reader understand the environment within which the City's
financial activities take place
• Operating Information
Contains service and infrastructure data to help the reader understand how the City's
• financial report relates to the services the City provides and the activities it performs
Unless otherwise noted, the information in these schedules is derived from the comprehensive
annual financial reports for the relevant year. The City implemented GASB 34 in the 2002 fiscal
year; schedules presenting government-wide information include information beginning in that year.
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Qtycf Flibrrgtarr teach
Net Assets by Corrpanat-Last Four Fiscal Years
(In lhor,rsands)
Fscal Year Er dr g 5eptesrber 3Q
GmaTnErtal Activities MW 2D04 2003 20M
I,hcsb,a in 03pitai Assets,Net of Fbated Debt $ 479,897 $ 448,217 $ 446,061 $ 425,967
Fbstrided 39,227 61,051 51,261 42,417
thre5tcted 40,226 (9278) (12924} (10,745)
Tdal GoawnE tEd Activities Not Assets $ 599350 $ 4SR990 $ 484,398 $ 457,M9
Business-Type Activities
Irhe rHt in Capital Assets,Net d F aced DEU $ 10Z068 $ 9Z890 $ 86,884 $ 79,781
Fiestrided 34,085 32,968 30,946 31,043
Lhiastrided 41,563 33,654 4671 4235
Total BLdnress-Type Activities Net Assets $ 177,716 $ 15%622 $ 145,501 $ 1408D
RinnyOmaru ert
IrTusstrn3i in Captal Assets,Net d Feed Drat $ 5B1,985 $ 541,107 $ 534,945 $ 505,748
Restricted 73,312 94,019 8Z207 73,450
U estrided 81,789 24,386 12,747 12,491
TotalPriinuyGmenrn3t Not Assets $ 737,006 $ 6SR512 $ 62%899 $ 591,699 f
Cityof Huntington Beach
Changes in Net Assets-Last Far Fiscal Years (�
On Thorrsards)
Er'{>e BM Fiscal Year fixing Sepherrber 30,
Cyu4myrstal Ac dAes: 20M 2004 2003 20M
city GDndl $ 254 $ 290 $ 2F $ 262
atyAd"nstratcr 1,990 1,186 1,597 Z214
aty Tmmver 1,538 1,541 1,341 1,160
city Att mw Z852 Z775 Z899 3,634
aty aerk 685 717 552 89B
AdnnstrativeServioes 5,554 6,348 8,357 7,230
Finance 2,W na rya na
Raying 2,559 2,396 3�633 Z656
6rildng 3,321 Z858 3;045 3,101
Fire 23,365 20,000 19,490 19,361
InfanrabcnSystem 6;806 6,423 4,401 4,464 fi
Police 47,C129 40,686 41,104 42,187
Ec ancDe,,elaprrert 4,199 19,372 3,830 3,090
C 3Tn,Lf ySavices 13,693 15,735 9,989 12,440
LidaySermoes 4,394 4,138 6,721 4,8D1
Rblic Wxks 33,018 30,277 25,386 213,237
Nbn-GLperhr ld 12,024 4,0554 25604 19,725
Interest on Lcrx}Term Doi 6,810 6,001 6,199 9,438
Total Gmmnrrgtd Activities 17Z,622 %6 789 ICA412 1%690
BLdness-type Activtties:
Witer Utility 22,349 24,643 24,943 27,250
Sawservlce 5,924 4,042 3,775 Z419
RE(LseC dledim 9,M5 9,805 901 9,178
FJradd C)ae FbAng 399 409 401 405
Effopeicy Fire Nbdcal 5,497 5,6D5 3,765 3,172
Q1tual Affars - - - 317
Fwrut Savice 141 204 150 143
cogenmeNES6-tes 118 62 58 11
Taal Business Type Activities 44,254 44,771 4Z773 42,896
Total l3raness and Gvmrrrst Type Activities 214876 2 %aw 29,186 207,585
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. City of Huntington Beach
Changes in Net Assets-Last Four Fiscal Years
(In Thousands)
(continued)
• Revenues: Fiscal Year Ending September 30,
Governmental Activities: 2005 2004 2003 2002
• Charges for Services $ 28,808 $ 30,419 $ 22,958 $ 23,556
Operating Grants 1,657 6,343 1,736 5,063
Capital Grants 43,341 7,384 6,955 13,039
Total Governmental Activities Program Revenue 73,806 44,146 31,649 41,658
Business-Type Activities Program Revenue
. Water Utility 40,371 40,172 37,943 59,104
Sewer Service 8,512 6,373 5,876 4,540
Refuse Collection 9,985 10,412 9,123 9,182
Emerald Cove Housing 866 781 746 707
Emergency Fire Medical 5,725 5,650 4,103 4,103
Cultural Affairs - - - 189
Hazmat Service 110 187 233 145
Ocean View Estates 263 258 245 192
Total Business Type Activities 65,832 63,833 58,269 78,162
Total Primary Government Program Revenue 139,638 107,979 89,918 119,820
. Net(Expense)Revenue:
Governmental Activities (98,816) (120,643) (132,763) (123,032)
Business-type Activities 21,578 19,062 15,496 35,267
Total Net(Expense)Revenue (77,238) (101,581) (117,267) (87,765)
General Revenue and Other Changes in Net Assets
. Governmental Activities:
Property Taxes 61,466 47,405 40,633 38,106
. Sales Taxes 24,340 28,273 28,011 23,449
Utility Taxes 20,004 19,424 18,310 18,114
Other Taxes 14,952 11,365 13,337 13,521
. Use of Money and Property 3,137 3,528 9,923 13,895
From Other Agencies 8,186 14,406 16,414 20,359
• Participation Payments 12,697 na na na
Other 8,510 7,328 5,491 2,603
Total Governmental General Revenue 153,292 131,729 132,119 130,047
• Business-Type Activities:
Use of Money and Property 1,500 1,085 1,482 2,240
Total Business-Type Activities General Revenue 1,500 1,085 1,482 2,240
Total General Revenue and Transfers 154,792 132,814 133,601 132,287
Change in Net Assets 77,554 31,233 16,334 44,522
Net Assets-Beginning of Year 659,512 629,899 607,633 563,111
Prior Period Adjustment - 1,620 (5,932) -
Net Assets-Beginning of Year(Restated) 659,512 628,279 613,565 563,111
Net Assets-End of Year $ 737,066 $ 659,512 $ 629,899 $ 607,633
Source:Comprehensive Annual Financial Reports. The City implemented the new reporting model in
fiscal year 2001-2002. Until 10 years of data are available,only the available years will be presented.
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CITY OF HUNTINGTON BEACH
FUND BALANCES -GOVERNMENTAL FUNDS- LAST TEN FISCAL YEARS
(In Thousands)
(Modified Accrual Basis of Accounting)
• Fiscal Year Ending September 30,
2005 2004 2003(a) 2002(b) 2001 _
General Fund:
. Reserved $ 5,915 $ 2,113 $ 2,757 $ 25,773 $ 23,677
Unreserved 32,371 24,219 12,217 15,972 11,741
. Total $ 38,286 $ 26,332 $ 14,974 $ 41,745 $ 35,418
Other Governmental Funds:
• Reserved $ 35,458 $ 30,143 $ 35,470 $ 45,259 $ 81,465
Unreserved, Reported in:
Special Revenue Funds 17,833 11,810 10,399 7,967 21,698
• Debt Service Funds 3,916 4,434 10,992 (33,364) 12,969
. Capital Projects Funds 16,820 10,242 8,553 8,637 7,898
Total Other Governmental Funds $ 74,027 $ 56,629 $ 65,414 $ 28,499 $ 124,030
Fiscal Year Ending September 30,
2000 1999 1998 1997 1996
General Fund:
. Reserved $ 26,115 $ 23,628 $ 23,807 $ 23,358 $ 28,069
. Unreserved 17,618 19,291 8,998 11,142 591
Total $ 43,733 $ 42,919 $ 32,805 $ 34,500 $ 28,660
Other Governmental Funds:
. Reserved $ 72,056 $ 61,401 $ 58,634 $ 54,676 $ 64,716
Unreserved, Reported in:
Special Revenue Funds 19,073 12,748 8,845 8,004 7,797
. Debt Service Funds - - 9,567 9,442 1,952
• Capital Projects Funds 11,793 4,968 9,933 10,465 10,704
Total Other Governmental Funds $ 102,922 $ 79,117 $ 86,979 $ 82,587 $ 85,169
• NOTES:
(a) In fiscal year 2002-2003,the City changed accounting for interrund advances and eliminated the advances to/from in each fund. This
results in a smaller reserved fund balance in the General Fund and eliminates the deficit in the Redevelopment Agency Debt Service
Fund.
(b) Beginning with fiscal year 2001-2002, the City implemented the new reporting model which changed the way in which interfund
advances were reported and resulted in a larger negative fund balance in the Redevelopment Agency Debt Service Fund.
•
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98
CITY OF HUNTINGTON BEACH
CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS-LAST TEN FISCAL YEARS
(In Thousands)
(Modified Accrual Basis)
Fiscal Year Ending September 30,
2005(d) 2004 2003 2002 2001
REVENUES:
Property Taxes $ 59,716 $ 43,501 $ 38,983 $ 33,204 $ 36,860
Sales Taxes 24,340 28,273 28,011 23,449 28,082
Utility Taxes 20,004 19,424 18,310 18,014 17,045
Other Taxes 13,068 11,365 13,337 13,621 15,096
Licenses and Permits 7,457 7,736 8,046 7,162 6,902
Fines and Forfeitures 4,365 4,342 3,815 3,797 4,092
From Use of Money and Property 12,733 11,856 9,923 13,895 15,812
From Other Agencies 20,179 26,321 25,103 28,426 31,634
Charges for Current Service/Other Revenue 33,950 17,553 14,140 15,201 12,150
TOTAL REVENUES 195,812 170,371 159,667 156,769 167,673
EXPENDITURES
Current:
City Council 254 280 269 237 231
City Administrator 1,917 1.165 1,559 2,109 1,776
City Treasurer 1,547 1,519 1,377 1,108 916
City Attorney 2,848 2,771 2,836 3,570 2,943
City Clerk 679 712 555 676 559
Administrative Services 5,731 6.295 8,323 7,095 3,874
Finance 2,501 - - - -
Community Development - - - - -
Planning 2,548 2,382 2,544 2,585 2,329
Building 3,291 2,938 3,043 2,991 2,589
Fire 22,365 19,018 19,021 18,024 18,142
Information Systems 5,726 5,315 3,619 3,5D0 2,814
Police 45,778 39,414 41.184 37,990 39,081
Economic Development 2,866 5,132 3,616 3,073 2,816
Community Services 12,321 11,718 10,182 11,065 11,395
Library Services 3,969 3,745 4,215 4,350 4,265
Public Works 21,535 16,756 19,832 21,565 24,870
Non-Departmental 13,039 23,B09 31,236 13,407 15,298
Capital Outlay 9,065 29,484 24,217 54,356 33,687
Debt Service:
Principal B,474 8,718 7.427 5,541 11,884
Interest 5,999 5.987 6,273 7,152 16,204
TOTAL EXPENDITURES 172,453 187,158 191,328 200,394 195,673
EXCESS(DEFICIENCY)OF REVENUES OVER _
(UNDER)EXPENDITURES 23,359 (16,787) (31,661) (43,625) (28,000)
OTHER FINANCING SOURCES(USES):
Transfers In 20,690 30,274 54,463 58,948 21,267
Proceeds of Bankruptcy Settlements - - - - -
Reclassification of Interfund Advances 16,018
Capital Assets Reclassification for Changes in Fund
Type (1,743)
Payments to Escrow - - - (52,673) -
Proceeds of Long-Term Debt 1,102 13,236 24,582 61,514 37,947
Transfers Out (16,006) (24,148) (57,096) (59,818) _ (21,91)8)
TOTAL OTHER FINANCING SOURCES(USES) 5,986 19,362 36 224 7,971 37,306
INCREASE(DECREASE)IN FUND BALANCES $ 29,345 $ 2,575 $ 4,563 $ (35,6541 $ 9,306
DEBT SERVICE AS A PERCENTAGE OF NON-
CAPITAL EXPENDITURES 9.7% 10.3% 8.9% 9.5% 21.0%
NOTES:
(c) Community Development was reorganized into two separate departments(Planning and Building). Information Systems was
recorded originally in the Non-departmental area and transferred to a new department.
(d) Finance was originally with Administrative Services.
99
•
•
•
s
•
•
Fiscal Year Ending September 30,
2000 1999(c) 1998 1997 1996
$ 37,645 $ 34,345 $ 32,477 $ 29,341 $ 29,320
26,268 22,699 21,156 19,512 18,555
15,058 14,936 13,888 14,059 13,222
10,868 11,122 9,851 8,632 8,102
8,538 10,527 8,848 8,121 6,567
4,018 2,744 2,649 2,707 2,134
14,603 10,913 12,614 12,971 14,291
32,021 24,753 21,539 19,810 18,171
. 15,847 14,071 13,945 11,191 16,708
164,866 146,110 136,967 126,344 127,070
i
• 277 275 207 233 224
1,799 1,569 1,092 1,856 2,140
884 820 805 781 743
• 2,227 1,969 2,340 1,738 1,466
451 474 434 470 488
3,559 2,876 3,056 4,028 4,181
- 4,067 3,919 3,694 3,252
2,180
2,384 - - -
17,471 15,639 16,368 15,806 14,747
36,140 34,343 34,127 33,413 32,650
6,749 3,598 3,452 2,142 3,010
9,815 8,439 7,723 7,301 7,535
. 3,984 3,510 3,212 3,034 2,951
25,263 18,287 18,686 17,159 16,297
18,572 12,929 14,919 9,867 9,399
18,740 20,739 15,894 13,833 9,823
6,333 12,111 2,313 2,340 2,966
14,965 16,654 9,648 10,189 11,261
171,793 158,299 138,195 127,884 123,133
• _ (6,927) (12,189) (1,228) 11,540) 3,937
• 30,529 7,794 12,494 14,820 9,203
3,833 - - -
• (10,001)
30,110 25,684 1,179 9,977 3,603
(32,958) (9,053) (12,852) (20,924) (9,716)
31,514 14,424 821 3,873 3,090
$ 24,587 $ 2,235 $ (407) $ 2,333 $ 7,027
•
16.2% 26.4% 10.8% 12.3% 14.4%
100
•
CITY OF HUNTINGTON BEACH
ASSESSED AND ACTUAL VALUATION
OF ALL TAXABLE PROPERTY(EXCLUDING REDEVELOPMENT AGENCY)
LAST TEN FISCAL YEARS
(In Thousands)
Common Total Assessed Total Direct Tax
_Fiscal Year _ Property Public Utilities Total Secured Unsecured Valuation Rate
1995-1996 $ 11,817,571 $ 2,216 $ 11,819,789 $ 538,559 $ 12,358,348 $ 1.05921
1996-1997 11,707,410 1,899 11,709,309 600,667 12,309,976 1.05832
1997-1998 12,311,145 1,300 12,312,945 546,050 12,8581995 1.05830
1998-1999 13,376,116 2,705 13,378,821 598,733 13,977,554 1.05840
1999-2000 13,386,740 1,670 13,388,410 581,160 13,969,570 1.05810
2000-2001 15,7%,157 2,745 15,798,902 674,719 16,473,621 1.05810
2001-2002 16,081,760 2,449 16,084,209 699,307 16,783,516 1.00770
2002-2003 17,949,445 2,428 17,951,873 820,219 18,772,092 1.01902
2003-2004 17,987,861 2,876 17,990,737 911,027 18,901,764 1.02571
2004-2005 19,532,238 3,524 19,535,762 877,078 20,412,840 1.06575
Source:County of Orange Auditor Controller
PROPERTY TAX RATES
ALL DIRECT AND
OVERLAPPING GOVERNMENTS
TAX RATE 04-041
LARGEST AREA IN CITY
Metro Water
Year Basic Levy City Orange County School Districts District Others Total
1995-1996 $ 1,00000 $ 0,04930 $ 0.00050 $ 0.00033 $ 0.008% $ 0.00018 $ 1.05921
1996-1997 1.00000 0.04930 0.00012 0.00890 - 1.05832
1997-1998 1.00000 0.04930 0.00010 0.00890 1.05830
1998-1999 1.00000 0.04930 0.00020 - 0.00890 1.05840
1999-2000 1.00000 0.04930 - - 0.00880 1.05810
2000-2001 1.00000 0.04930 - 0.00880 1.05810
2001-2002 1.00000 - - 0.00770 - 1.00770
2002-2003 1.00000 - 0.01232 0.0%70 - 1.01902
2003-2004 1.00000 0,00696 0.01214 0,00610 0,00051 1.02571
2004-2005 1.00000 0.00696 0.02850 0.00520 0.02509 1.D6575
Note-Rates are per$100 of assessed valuation
Source:County of Orange Auditor Controller
101
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i
CITY OF HUNTINGTON BEACH
• PROPERTY TAX LEVIES AND COLLECTIONS
LAST TEN FISCAL YEARS
(In Thousands)
• SECURED TAXES UNSECURED TAXES
TOTAL DELINQUENCY DELINQUENCY TOTAL DELINQUENCY DELINQUENCY
TOTALLEVY COLLECTIONS AMOUNT PERCENT TOTALLEVY COLLECTIONS AMOUNT PERCENT
. 1995-96 $ 16,272 $ 16,100 $ 647 3.86% $ 1,165 $ 1,138 $ 27 2.32%
1996-97 16,722 16,401 320 1,91% 1,102 1,085 17 1.60%
• 1997-98 17,630 17,176 272 1.54% 1,247 1,077 40 3.21%
1998-99 18,341 17,855 262 1.47% 1,243 1,146 35 3.05%
1999-2000 21,001 20,676 284 1.35% 1,321 1,231 29 2.20%
2000-2001 22,724 22,035 629 2.77% 1,348 1,267 33 2.45%
2001-2002 24,581 24,238 343 1.40% 1,419 1,366 53 3.74%
• 2002-2003 26,376 25,937 362 1.37% 1,467 1,343 82 5.59%
2003-2004 29,423 28,669 293 1.00% 1,507 1,382 35 2.32%
. 2004-2005 1 31,849 48,750 411 1.29% 1 1,506 1,473 42 2.62%
• RESERVOIR HILL COMMUNITY FACILITIES DISTRICTS
• 1995-96 $ 186 $ 176 $ 9 5.11% $ 264 $ 239 $ 25 10.45%
1996-97 182 179 3 1.68% 264 251 13 5.18%
1997-98 173 184 9 4.89% 264 255 9 3.53%
1998-99 194 184 9 4.89% 264 255 8 3.14%
1999-2000 184 181 3 1.63% 264 259 5 1.89%
• 2000-2001 184 180 4 2.17% 264 258 5 1.89%
2001-2002 188 184 4 2.13% 264 258 6 2.27%
S 2002-2003 191 188 3 1.57% 538 538 1 0.19%
i 2003-2004 191 192 - 0.00% 1,796 1,789 2 0.11%
2004-2005 238 234 7 2.94% 1,731 1,722 5 0.29%
. Source:County of Orange Auditor Controller's Office
Note-Delinquency amount does not always equal levy amount minus collections
amount since there are always amounts collected from prior years
•
0
0 TOP TEN PROPERTY TAXPAYERS
• FOR FISCAL YEAR 2004/05
• Revenue
. In Thousands Percent of Total
Mayer Financial Limited Partnership $ 1,765 4.21%
Mc Donnel Douglas Corporation/Boeing Corporation 798 1.90%
PLC Waterfront LLC 450 1,07%
Huntington Center Associates 437 1.04%
• Waterfront Construction 1 369 0.88%
MullrOCk 1 Beach Pointe LLC 324 0.77%
Essex Huntington Breakers 288 0.69%
Pierside Pavilion LLC 264 0,63%
• Atlanta Huntington Beach LLC 234 0,56%
First Huntington Center 215 0.51%
. Total Tap Ten 5,144 12.26%
All Other Properties 36,786 87.74%
w City Total $ 41,930 100.00%
• Source., HdL Coren&Cone
102
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CITY OF HUNTINGTON BEACH
RATIOS OF OUTSTANDING DEBT BY TYPE
LAST TEN FISCAL YEARS
(In Thousands)
p�r
Fiscal Year Ending September 30, Fiscal Year Ending September 30,
Long-Term Indebtedness 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996
Governmental Activities:
Judgement Obligation Bonds $ 12,245 $ 12,500
Public Financing Authority: - - - 20,460 20,885 21,275 30,860 31,360 31,840
Revenue and Lease Revenue Bonds 58.030 60,840 63,535 66,125 37,940 7,02C 7,440 7,840 8.070
Certificates of Participation 15,525 16,140 16,73C 17,295 17,840 18,310 -
Public Facilities Corporation - - - - - - - 385
Leasehold Mortgage Bonds
Civic Improvement Corporation - - 29,750 30,880 31,955 32,980 33,960 34,900
Refunding Certificates of Participation - - 360 415 605 815 1,030 1.090 1,145 1,200
Assessment Bonds
Redevelopment Agency:
Tax Allocation Bonds 27,205 28,305 29,375 30,370 9,770 10,060 10,340 - - -
Disposition and Development Agreement 10,083 10,730 10,549 11,280 4,756 9,770 10,142 - -
Notes Payable 116 337 545 1,035 1,272 1,566 759 810 862 606
Section 108 Loan 7,550 7.850 7,630 7,890 8,130 8,355 - `
Capital Leases Payable 3,461 4,885 6,420 4,107 2,007 155 - - - 387
Claims Payable 14,545 11,937 37,191 12,612 10,177 9,743 9,982 11,774 11,761 11,372 �e
Compensated Absences Payable 9,045 8,037 8,223 8,950 8,075 6,135 5,463 5,323 4.977 5,014
Pension Benefit Obligation 7,540 8,409 8,342 8,593 8,337 8,150 7,255 6,271 5,592 -
Business Activities:
Emerald Cove Certificates of Participation - - - - - - 5,105 5,205 5,300 5,390
Capital Leases 112 183 250 595 432 1,550 1,633 2,215 993 896
Compensated Absences 786 710 623 491 472 457 383 . 375 333 266
$ 166,343 $ 170,863 $ 189,773 $ 169,758 $ 160,023 $ 133,851 $ 112,762 $ 104,743 $ 104,353 $ 92,256
2005 2004 2003 2002 2001 2000 1999(c.) 1998 1997 1996
Population 200,763 199,025 196,954 194,600 191,500 199,327 196,660 192,430 188,518 153,254
Debt Per Capita $ 629 $ 859 $ 964 $ 872 $ 836 $ 672 $ 573 $ 544 $ 554 $ 602
Total Personal Income(In Thousands) $ 7,311,186 $ 7,247,893 $ 7,444,861
Per-Capita Personal Income 36,417 $ 36,417 $ 37,800
Unemployment Rate 2.40% 2700/. 2.60% f
l
NOTE:
Information on personal income is not readily available for year 2002 and earlier. Until data is readily available,only the available years will be presented. c
103
C
CITY OF HUNTINGTON BEACH
• LEGAL DEBT MARGIN
LAST TEN FISCAL YEARS
(in Thousands)
Debt Limit-12%of Debt Applicable
Assessed Valuation Assessed Valuation to Limit Legal Debt Margin
1995-96 12,358,348 1,483,002 1,483,002
• 1996-97 12,309,976 1,477,197 - 1,477,197
1997-98 12,858,995 1,543,079 - 1,543,079
1998-99 13,977,554 1,677,306 - 1,677,306
1999-2000 . 13,969,570 1,676,348 - 1,676,348
2000-2001 16,473,621 1,976,835 1,976,835
• 2001-2002 16,783,516 2,014,022 2,014,022
2002-2003 18,772,092 2,252,651 2,252,651
2003-2004 18,901,764 2,268,212 2,268,212
• 2004-2005 20,412,840 2,449,541 2,449,541
PRINCIPAL PRIVATE EMPLOYERS
• CURRENT YEAR AND ONE YEAR AGO(a)
2005101 %of total 2004 %of total
Boeing 4,282 3.59% 4,800 4.02%
Quiksilver 1,550 1.30% 1,600 1,34%
. Cambo Manufacturing 886 0.74% 886 0.74%
Dynamic Cooking Systems 706 0.59% 700 0.59%
Triad Financial 637 0,53% 637 0.53%
• E-Trade Mortgage 554 0.46% 561 0.47%
C&D Aerospace 554 0.46% 665 0.56%
• Huntington Beach Hospital 513 0.43% 513 0.43%
Rainbow Disposal 408 0.34% 420 0.35%
Verizon 556 0,47% 352 0.30%
• Total of top 10 10,646 8.92% 11,134 9.33%
all others 108,654 91.08% 108,166 90.67%
• Total employment(public and private) 119,300 100.00% 119,300 100.00%
Source-Economic Development Department,City of Huntington Beach
• (a)The information for 1996 is not readily available. Until data is readily available,only the available years will be presented,
(b) Total employment number for 2005 is not readily available,as a result,2004 total was used.
104
CITY OF HUNTINGTON BEACH
FULL-TIME BUDGETED CITY EMPLOYEES BY FUNCTIONIPROGRAM
General Government: 2005 2004 2003 2002 2001 f
City Council 1.00 1.00 1.00 1.00 1.00
City Administrator 29.00 7.00 13.00 17.00 17.00
City Treasurer 16.00 16.00 16.00 16.00 16.00
Gty,Attorney 17.00 15.00 14.00 16.00 16.00
City Clerk 7.50 7.50 8.00 8.00 8.00
Finance Office 23.00 - - - -
Administrative Services 0.00 47.00 49.00 53.50 50.50
Planning 27.50 25.00 26.00 28.00 28.00
Building 30.50 27.50 27.50 27.50 25.50
Information Systems 36.00 37.00 18.50 18.25 15.25
Economic Development 14.00 11.00 12.00 15.00 15.00
Library Services 37.25 38.25 40.25 45,75 45.75 t;
Fire 157.00 156.50 162.00 166,00 165.00
Police 371.50 366.00 379.00 388.00 388.00
Community Services: 64.50 62.25 67.50 71.50 71.50
Public Works 240.00 231.00 264.00 270.00 263,00
1,071.75 1,048.00 1,097.75 1,141.50 1,125.50 +�
OPERATING INDICATORS BY FUNCTIONIACTIVITY CAPITAL ASSET STATISTICS F
BY FUNCTtONIACTIVITY l
FunctiontProgram 2005 2004
City Treasurer: Library Services One Main Library
Water Bills Processed 586,000 632,868 and Four Branches
Business Licenses Issued 20,184 19.515
Accounts Receivable Billings Processed 22.768 27,044 Fire:
City Clerk: Fire Stations B
Passports Issued 3.676 3,795
Planning Police:
Entitlements Processed 523 572 Stations One Main Station �e
Plan Reviews 2,296 1,414 and Two Substations
Field Inspection Complaints 5.550 3,857 p
Code Violation Cases 3,906 2,018 Community Services:
Building: Acreage of Parks 955
#of Permits Issued 49,737 45,629 Community Centers 4
Value of Construction Permits 3,253 3,211 Miles of Beach Maintained 3.5
Processed#of Certificate of Occupancies .683 647
Automated Information Requests 78,868 81.141 Public Works:
Fire: Centerline Square Miles {
Inspections 4.100 4,000 of Streets Maintained 467.7
Responses 12,100 12,800 Miles of Storm Drains {
Police: Maintained 137 {
Physical Arrests 5,282 5,942 Miles of Sewer Maintained 355
Parking Violations 112,698 79,235
Traffic Violations 25,902 24,467
Community Services:
Acreage of Parks 998
Estimated Beach Visitors 8,727,369 7.958,466
Enrollment in Recreation Classes 22,346 22,670 {
Public Works:
Water Sold(Acre Feet) 29,730 32,147
Gallons of Sewage Pumped Per Day 23 million 23 million
Library.
Volumes in Collection 441,523 439.789
Volumes Borrowed 931,347 1.200,000
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i
CITY OF HUNTINGTON BEACH
• STATEMENT OF DIRECT AND
OVERLAPPING BONDED DEBT
i SEPTEMBER 30,2005
• 2004-2005 Assessed Valuation$20,680,318,348(after deducting$1,006,231,024)of incremental redevelopment valuation)
•
! Percent
• Debt Repaid with Property Taxes(Tax and Assessment Debt): Applicable Debt
Tax Debt:
. Orange County Teeter Plan Obligations 7.37% $ 9,121,007
Metropolitan Water District 1.57% 6,525,708
i Coast Community College District 31.24% 32,086,292
• Huntington Beach City School District 97,67% 29,877,157
Huntington Beach Union High School District 76.58% 133,599,780
i Los Alamitos Unified School District Comm Facilities Dist. 1990-1 1.27% 154,131
City of Huntington Beach Community Facilities District 1990-1 100.00% 1,915,000
City of Huntington Beach Community Facilities District 2000-1 100,00% 15,500,000
• City of Huntington Beach Community Facilities District 2003-1 100.00% 4,895,000
City of Huntington Beach Community Facilities District 2002-2 100.00% 25,000,000
. Tax and Assessment Debt 258,674,075
Other Debt
Other Entities:
• Orange County General Fund Obligations 7,37% 62,524,07D
Orange County Pension Obligations 7.37% 7,351,085
. Orange County Board of Education Certifictes of Participation 7.37% 1,467,028
Orange County Transit Authority 7.37% 182,088
MWDOC Facilities Corporation 8.79% 2,477,809
. Orange County Sanitation District Certificates of Participation 10.11% 13,180,407
Coast Community College District Certificates of Participation 31.24% 2,247,502
• Huntington Beach Union High School District Certificates of Participation 76.58% 13,018,430
Los Alamitos Unified School District Certificates of Participation 12.67% 212,399
. Fountain Valley School Districts Certificates of Participation 29.04% 4,260,315
Huntington Beach City School District Certificates of Participation 97.67% 10,563,335
! Ocean View School District Certificates of Participation 94.97% 8,932,305
• Westminster School District Certificates of Participation 39.55% 7,220,035
City of Huntington Judgement Obligation Bonds 100.00% 12,245,000
City of Huntington Reporting Entity Beach General Fund Obligations: 100.00% 74,591,140
Total Gross and Overlapping Bonded Debt Not Repaid by Property Taxes 220,472,948
! Less Self Supporting Debt of MWDOC and OCTA (2,623,480)
• Total Net Direct and Overlapping General Fund Obligation Debt 217,849,468
Net Combined Total Debt $ 476,523,543
•
• Gross Combined Total Debt $ 479,147,023
Ratios to 2004-2005 Assessed Valuation 1.19%
• Ratios to Adjusted Assessed Valuation:
Combined Direct Debt($86,836,140) 4.20%
i Gross Combined Total Debt 2.32%
Net Combined Total Debt 2.30%
Source: California Municipal Statistics and City of Huntington Beach Finance Department
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