HomeMy WebLinkAboutReport on Examination of Financial Statements - 6/30/74 Ili
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CITY OF HUNTIN(3TON BEACH
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REPORT ON EXAMINATION OF FINANCIAL STATEMENTS
i For The Year Ended June 30, 1974
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CITY OF HUNT:ZNGTON BEACH
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TABLE OF - -ONT�ENTSS
Accountants' Report 1
Balanco Sheet, All Funds 3
Balance Sheet, Special Revenue Funds 4
Balance SheE;., Debt Service Funds 5
Balance Sheet, Capital Project Funds 6
Analysis of Changes in Fund Balances, All Funds 7
Analysis of Changes in Fund Balances, Special
Revenue Funds 8
Analysis of Changes in Fund Balances, Capital
i Project Funde 9
Statement of Revenue, All Funds 10
Statement of Revenue -- Estimated and Actual -
General Fund 11
Statement of Revenue - Estimated and Actual -
Special Revenue Funds 12
Statement of Revenue, Expenditures and Fund
Balances - Debt Service Funds 14
Statement of Revenue - Estimated and Actual -
Capital Project Funds 15
i Statement of Expenditures and Encumbrances
Corpared with Appropriations - General Fund 16
Statement of Expenditures and Encumbrances
Compared with Appropriations - Special
Revenue Funds 17
i Statement of Income - Budgeted and Actual -
Water Utility Fend A
Analysis of Changes in Retained Earnings -
Wator Utility Fund 19
Schedule of Operating Expense - Budgeted and
Actual - Water Utility Fund 20
Statement of Changes in Financial Position -
Water Utility Fund 21
Notes to Financial Statements 22
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COOPERS & LYBRAND
Cl `TIf ICp PUULIC ACCOUNTANTS
Ii. PRINCIPAL ARCAS
of THC WORLD
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City Council
City of Huntington Beach
Huntington Beach, California
We have examined the financial statements of the various funds and
account groups of the City of Huntington Beach as of June 30, 1974
and for the year then ended, listed in the Foregoing table of
contents. Our examination was made in accordance with generally
accepted auditing standards, and accordingly included such tests
of the accounting records and such other auditing procedures as we
considered necessary in the circumstances except as stated in the
following paragraph.
The Water Utility Fund does not maintain deta:.led records of
approximately $99600000 of purchased property and equipment that
is capitalized. In additi.)n, the Water Utility Fund has capitalized
approximately $8,3709000 for assets contributed to the City through
June 302 196E by subdividers at values estimated by City personnel.
There is no supporting documentation for the amount capitalized.
Contributions by subdividers since June 30, 1968 have aot been
recorded on the books. Because we were unable to satisfy ourselves
by appropriate audit tests or by other means as a result of these
incomplete records we are unable to express an opinion on the
accompanying financial statements of the Water Utility :Fund.
"he Cite does not maintain detail property accounts and is therefore
unable to properly account for its fixed assets ar explained in
Note 1. Generally accepted accounting principles applicable to
municipalities recommend that, in the absence of complete historical
cost records, the fixed asset accounts be adjusted to reflect actual
or estimated acquisition costs of property currently owned. Because
of the pon'sible material effect of the foregoing deviation from
generally accepted accounting principles we do not express an
opirton on the financial statements of the General Fixed Assets.
i � In our opinion, the financial statements listed in the table of
contents other than the financial statements of the Water Utility
Fund and the General Fixed Assets present fairly the financial
position of such funds and account groups of the City of Huntington
Beach at June 30, 1974 and the results of operations of such funds-
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for the year then ended, in conformity with generally accepted
accounting principles applied on a basis conuistent with that of
the preceding year.
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Newport Beach, California
November 141 19711
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CITY OF HUNTINGTON BEACH
BALANCE SHEET. ALL FUNDS
June 30. 1974
Totals Special Debt Capital Water General General
(Memorandum General Revenue Service Project Utility Trust Long-Term Fixed
Only) Fund Funds Funds Funds _wund Pund Debt Assets
A S F L T S:
Cash (note 2) $9 121 6BO ;1 412 904 35 910 330 $22 653 ($141 1971 057 $124 691
Cash advanced to fiscal agent 354 910 9 CLO 345 :10
Accounts receivable 1 002 728 271 903 47A 071 8 GAO 4$9 247 7;
Leas, Allowance for do0tful accounts (24 150) (2 OS$) (1 670) (21 000)
Receivable - federal grants 0% 5799 295 460 300 419
Property taxes impcunded 726 51a 710 SIB
Leer. Reserve for property taxes impounded (710 518) (720 516)
Special asset ments receivable n 090 49 a"
Prepaid leases and other 26 411 171 425 96 906
Deposits 32 269 32 269
Due from other funds 790 145 65 971 706 071 8 103
Estimated future revenue •red resources
for long-term debt retirement
(Notaa 3 and 4) 16 330 870 SIC 330 878
Property and equipment, leas allowance
for depreciation (Note 1) 29 511 601 15 434 420 $14 C27 301
o2^S�0; 1 9xeL 744 lie 32 aj 198,211 15 8� 6" 112 746 16 110 879 14 027 111
LIABILITIES. RESERVES, FUND BALAHCLS,
AND RETAINED EARNINGS:
General payables 1 765 05D 960 719 676 709 147 622
Contracts payable (Note 5) 290 122 2 9 222 900
Payroll payables 5 1 OB4 53 151 15 903
Due to other funds 710 145 103 594 221 111 150 65 971
Deferred compensation payable I1T 701 117 701
Other liabilities 164 529 149 Tit 14 064 7C1
Deposits held in truaC 132 795 132 796
Hatired interest payable 33 687 9 000 24 687
Ponded debt. not matured (Note 3) 8 462 324 57 324 3 160 000 5 765 000
Long-taro losses payable (Note 4) ID 565 a78 7.0 565 878
Deferred rental in.•ome (Note s) 650 coo 650 000
Reserved fort
P.ncusbranoes (Note ni 1 622 262 135 266 1 400 039 86 95T
Revenue bond retirerenL :76 55�y0 476 550
Other 13 4e4 13 4B4
Contribution to util.tr B 66 006 8 466 006
Investment in r-,eral fixed assets 14 027 391 14 02T 381
Fund baltnces 3 062 953 13 361 3 849 275 30 893 (30 596)
Retained earnings 4 503 001 4 Sol eel
$57 025 all 41 920 15 ST SO its i q 4i ;16� $16 961 421 $16 130 876 ;IA 027 781
See accoopWIng notes.
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CITY OF HONTINUIDN BEACH
BALANCE SHEET, SPECIAL MEMMUE FUNDS
.tune 30. 1974
Youth
CIVIC Planned Special Employ-
Special Parks And Improve- Local Assess- Revenue Dent
Gas Tax Heersatlen Mont Some DralnW Grant Meet Sharing Sorelce
Total Pund POW PWd- XF dm land Pund PVM Fund Fund
A S S E T S:
Cash 85 930 330 3509 660 (39 047) $1 010 595 sl 567 447 81 295 109 (335 611) $22 394 81 58o Sol $372
Accounts receivable 474 OT1 22T 175 4 674 107 460 34 917 14 461 35 606 28 270 21 301
Less, Allowance for dcubtful
accounts (1 670) (1 670)
Receivable - federal grants 255 460 35 403 259 9"
Special assessments receivable 43 090 43 ago
Prepaid lease aspens* 96 986 96 986
Dus from other funds 706 oil 85 791 50! 430 111 SSG _
7 54�4 1Ia &U.U►L 22 ; IJAL= 2 lick 794 LAU t Z-1bu 47 t54 LSAL=
LIABILITIES. RESERVES.
AND FOND DWWCES:
General parables 676 709 215 376 113 997 124 7160 181 474 38 231 ISO 2 349 372
Contreats payable (Note 5) 289 222 289 222
Due to other funds 594 221 85 790 491 e01 17 430
Other liabilities 14 064 11 346 2 718
Bonded debt, not matured (Hot. 3) 57 324 57 324
Deferred rental income (Mot* 4) 65D 000 650 000
neacrvid for:
Enaunbrances (Mote 11) 1 400 039 281. 085 285 o68 269 078 20 407 177 15g7 32 363 394 l8
other 13 484 13 484 +
Pund balance% 3 849 275 322 lb ( 03 6 452) 71 737 1 993 251 259 289 t2 065) 16 132 1 496 016 s18)
17 544 Ila *821 62g *91 61y 11 116 21S !2"� a^1 M 8M-M 02LM 81 ggL179 =3IZ
See accompanying notes.
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CITY OF HUNTINGTON BEACH
BALA14C£ SHEET, DEBT SEAYICE FOHDS
June 30, 1974
1955 Water 2970 park
Interest And Bond Interest
^10ta1 Aedem bats And Redemption
A S S
Fund
£ T $:
Cash
Cash advanced to fiscal agent $22 853 $65 066 ($42 213)3 ODD
goo 8 100
Recounts receivable 8 040
--995 -7045
66 g6i (.27 068)
LIABILITIES
AND FU11D BALAIICES:
Matured interest payable
9 ooD 400 8 loo
Fund balances
30 89,4 E6 061 (35 168)
x'39"Q33 sgy-�f l t s��}
See accompanying notes.
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CITY OF KUNTINCTON BEACH
SALAN". SHEET, CAPITAL PROJECT FUNDS
.Tune 30, 1974
1970
Park Bond 1955
Special Capital Construction Water Bond
Total outlay Fund Fund Construction Pund
A S S E T S:
Cash (i141 197) $99 429 (i317 936) $77 310
Accounts receivahlt 389 989
Receivable - federal grants 308 419 `0� B 419
168.211 100 415 { } 77 310
LIABILITIES, RESERVES,
AND FUND BALANCES:
Due to other funds 111 850 ill 850
Reserved for encumbrances 86 957 86 957
Fund balanL-Ls (30 96) 13 461 (121 361) 77 310
s169 s,a� (s 417) sZ3..314
See accompanying notes.
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• CZT'_' OF HUNTINGM1 4 BEACH
ANALYSIS OF CHANGES IN PUND BALANCES, ALL FUTMS
Par The Year Ended June 30, 1974
Totals Special Debt Capital
(Memorandum General Revenue Service Project
Onlxl Fund Funds Funds Funds
Balances, July 1. 1973 $6 387 551 $779 696 $5 097 463 SR 438 i467 960
Revenues 24 120 561 16 225 820 7 395 189 493 345 6 207
Transfers from other funds 1 686 433 1 653 726 32 707
Other additions 1 958 1 097 861
Total additions 25 808 952 17 eeo 643 Z 428 757 493 345 6 20T
Less%
Expenditures and nenexpenditure
disbursements 24 676 116 18 543 $95 5 122 568 904 ago 504 763
Reserve for encumbrances June 30, 1974 1 ?63 558 70 356 1 293 202
Transfers to other funds 1 643 682 32 707 1 611 175
Adjustment to remove advance rental
in:ome received in prior years
and credited to :und balance (Note 4) 650 000 650 coo
Total deductions 28 333 556 18 646 958 8 676 945 `04 890 504 763
Balances. June 30, 1974 i3 862 95-4 silt lei i f3�j5
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See accompanying notes.
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CITY CP HUHTINDTON HACH
ANAL731Z OT CHANOES IN TUNA BALANCES. 3YLCIAL R$YENUE FURLS
Tar The Year Ended June 30. 1974
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Civic
Special Parke And Improve—
Library Gas Tax Recreation cant Serar
Total Fund Pund Fy�r(Qr- Pond Fund
Balances. July 1. 1913 $5 097 463 1121 700 $634 400 (16 987) $498 778 it 9J3 15t
Revenues 7 395 139 1 329 145 109 102 1 993 241 287 711.
Tr:.nefers from other funds 32 707
Other additions 661
Total addltlons aL 28 7.51 3 3329 lay 709 102 L J93 2a3 217 111
Less:
Upanditures and nonespenditure
disbursements 5 122 563 940 295 627 648 1 065 002 197 410
Reserve for encu*nbr-'Cos. C
June 30. 1974 1 293 2D2 284 085 203 614 244 520 20 407
Transfers to ether funds 1 611 175 121 700 417 000 177 305 46D 752
Ad uatment to remove advance rental
�neme reetived in prior years
and credited to fund balance
(Note 4) 610 coo 6 0 000
Total deductions 8 676 945 121 700 61 41 380 1 000 567 2 420 282 217 81
Balances. June 30. 1914 1 83.. 4„� ?.75 Wd.— S 2A2 165 (f o3 6 452) /Zulu I1 Z 1
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See aeeoepar.Ting notes.
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Youth
Planned Steclal la;ploy- PUBIC
14ca1 A•aeaa- Revenue aunt PC-king And Traffic
Drainage 7rant r.#nt £haring Service Meter Proawticn Daraty
Fund funl -runj rued Punl fund Fund „FuM
$753 ale 11? 190 fl` 271 t1 1•5 999 11 077 (1V.'Z)
W 522 1 006 923 1 174 59a 13 633 $76 510 1357 608
32 707
ie6 sty1206 923 1 17t rar 13 633 6 alo 32 701 351 608
793 911 1 022 578 e6t 062 11 660
177 156 36J 394 la
76 alo 35T 609
9n-e€9 1 022 578 024 456 jam 6 910 t 609
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CITY OF HUNTI3iMN BEAr..H
ANALYSE, OF CHARGES IN FUND BALANCES, CAPITAL PROJECT FUNDS
For The Year Ended June 30, 1974
1970
Park Bond 1955
special Capital Construction Water Bond
Total Outlay Fund Fund Construction Fund
931ances, July 1, 1973 3467 960 i10 961 $319 659 $77 310
Revenues 6 207 2 500 3 707
Leas:
Expcn',Ltures, Central Park ( 05 k 763) ( OS 4 763)
Balances, June 30, 1974 tyy,,,;$¢) $1s 461 (¢121 167)
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See accompanying notes.
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C::7f OF BUNTIUMN BEACH
STATEMM OF REVENUE, ALL FUNDS
For The Year Ended June 30, 1974
Totals Special Debt Capita:
(Memorandum General Revenue Service Project
Only) Fund Punds Funds Funds
Taxes $13 381 686 Ill 078 107 31 814 063 $489 516
Licenses and permits 2 033 158 1 834 580 10 578
Pines, forfeitures and penalties 510 377 152 769 357 6oG
Use of money and property 1 184 556 K2 395 495 832 3 829 42 500
Current services 2 751 877 1 830 265 921 612
From other agencies 3 981 928 615 379 3 366 549
Other revenue 276 479 32 325 240 947 3 707
$ 4 Q 5 I J 2&5 82Q ST 3q i8g $4 ' =6 oT
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See accompan7ing notes.
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CITY OF HUNTINGTON BEACH
1 STATEMENT OF REVENUE - ESTIMATED AND ACTUAL - GENERAL FUND
For The Year Ended June 30, 1974
Over
�► Estimated Actual (Under)
Revenue Revenue Estimated
Taxes:
Property taxes - current year $6 775 859 $6 238 642 ($537 217)
Property taxes - prior year 143 690 429 368 285 678
w Other property taxes 3 000 2 706 (294)
Penalties on delinquent taxes 16 066 20 958 4 892
Sales and use taxes 3 300 000 3 300 470 470
Franchises 279 000 279 635 635
In lieu - water utility 260 000 280 163 20 16.1
Cigarette tax 480 000 477 571 (2 429) 1
w Occupancy tax 60 000 48 594 (11 406)
Total taxes 11 217 615 11 078 107 (232 508)
Licenses and permits:
Business licenses 430 000 429 294 (706)
Oil well licenses 920 000 802 349 (117 651)
Building permits 750 000 476 105 (273 895)
Other licenses and permits 146 000 126 832 (12 168)
Total licenses and permits 2 246 000 1 834 580 (411 420)
Fines, forfeitures and penalties 154 000 122 6 (1 2 1)
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Revenues from use of money
and property 817 875 682 395 (135 480)
Revenue from other agencies:
State 134o 000 1 446 176 10F 176
� • County 360 000 341 232 (10 768)
Federal 11 707 11 707
Other 34 500 31 .150 (3-,350)
I Total revenue - from
other agencies 1 734 500 1 830 265 95 765
S Charges for current service 730 ='95- of (115 116)
Other revenue 59 0 32325 (27 225)
Total revenue --
gene:ral fund $17 060 0 5 $16 225 ,A20, ($8 - 21 )
See accompanying notes.
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CITY OF HUNTINGTON BEACH
STATEKENT OF REVENUE - ESTIMATED AND ACTUAL --
SPEC: 4L REVENUE FUNDS
For The Year Ended June 30, 1974
^ Over
Estimated Actual (Under)
Revenue Revenue Estimated
Special gas tax fund:
State gas tax $1 431 000 $1 306 091 ($124 909)
R Interest income 43 000 23 ,054 (19 246)
Total revenue -
special gas tax fund 1 474 o0o 1 329,145 (144 855)
Parks and recreation fund:
Interest income �3 272 23 272
Subdivision license and
unit lot fees z4o 000 685 830 ( !1 170)
Total revenue - parks and
recreation fund 74Q000 709 102 (30 898)
w. Civic improvement fund:
Utility .taxes 1 738 000 1 814 063 76 063
Interest income 70 000 78 11!5 8 145
Other revenue 101 033 101 033
Total revenue - civic �.
improvement fund 1 808 000 1 993 241 185 241
Sewer fund:
Sewer permits 195 000 121 768 (73 232)
Interest income 70 000 126 942 56 942
Local assessment 110 000 38 642 (71 358)
Other 359 359
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Total revenue -
sewer fund $275 000 $28 711 ($87_ 289)
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Continued
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CITY OF HUNTINGTON BEACH
STATEMENT OF REVENUE - ESTIMATED AND ACTUAL
w SPECIAL REVENUE FUNDS, Continued
For The Year Ended June 30, 19,14
A Over
Estimat. ?d Actual (Under)
Revenue: Revenue Estimated
Planned local drainage fund:
Interest income $60 000 $109 827 $49 827
w Local assessment 600 000 197 140 (402 860)
Other 139 555 139 55,E
Total revenue - planned
local drainage fund 660 000 446 522 (213 478)
w Grant fund:
Grants 947 77 1 006 9Z3 59 144
Revenue sharing fund:
Interest income 70 000 134 592 54 592
Federal revenue sharing 832 000 1 039 902 207 902
w► Total revenue - revenue
sharing fund 90_2 000 1 174 494 272494
Youth employment service fund:
Various city's contributions 19 539 13 633 (5 906)
Parking meter fund:
Meter collections 100 000 76 810 (23 190)
Traffic safety fund:
Vehicle code fines 360 000 357 608 (2 392)
Total revenue --
special reve:iue funds $7 3.86 318 $7 195 1�� $�
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See accompanying notes.
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CITY OF HUNTINGTON BEACH
STATEMENT OF REVENUE, EXPENDITURES AND FUND BALANCES
DEBT SERVICE FUNDS
For The Year Ended June 30, 1974
�► 1955 Water 2970 Park
Interest Bond Interest
Arid And
Redemption Redemption
Total Fund Fund
Revenues:
Prcperty taxes $489 516 $34 357 $455 159
Interest income 3 822 _2 244 2 585
Total revenue 4 5 36 601 416 " 44
Expenditures:
Redemption of serial bonds 165 000 35 000 130 '!00
Interest on bonds 339 425 6 475 332 950
Fiscal agent's fees 465 108 357
Total expenditures 04 890 Ill 583 463 307 i
b (Deficit) to fund balance (11 545) (4 982) (6 563)
Fund balances, July 1, 1973 424 8 71 043 (28 605)
Fund balances,
June 30, 1974 $10 893 $6 ' ($ r 6")
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See accompanying notes.
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CITY OF HUNTINGTON BEACH
i STATEMENT OF REVENUE - ESTIMATED AND ACTUAL - CAPITAL PROJECT FUNDS
For The Year Ended June 30, 1974
Over
Estimated Actual (Under)
Revenue Revenue Estimated
Special capital outlay fund:
Interest income $1 000 $2 500 $1 500
1970 park bond construction fund:
Revenue from federal
government 423 000 (423 000)
Sale of property �0 000 3 707 26 2 )
{ Total revenue -
If 1970 park bond
construction fund 453 Q007o7 (449 293)
Total revenue -
�, capital project funds $454 goo $.L ($4,4„7- 793)
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See accompanying notes.
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CITY OF HUttTINCTON BEACH
STATrJUE rr OF EXPENDITURE: AND ENCL'HSRANCES COMPARED
WITH APPROPRIATIONS - GENERAL FUND
For The Year Ended June 30. 1974
ggnditures
Supp Total Original
And Other Expenditures Appropria-
Personal Fees And Capital And Lions Unencumbered
Services Services Outlay_ Total Encumbrances Encumbrances (Note 1D) Balance
General government:
City administration $196 443 $112 711 32 418 $311 572 $609 $312 180 $315 569 $3 389
Finance department 445 243 53 854 175 605 584 702 5 941 690 643 725 451 34 808
City attorney 194 66G 25 536 2 002 222 198 25 222 223 249 794 27 571
Planning 358 942 113 922 2 166 475 030 639 475 659 39a 461 (77 206)
All other 242 452 937 610 2 439 1 182 501 5 993 1 188 494 964 841 (223 6531
1 437 740 1 253 633 184 630 2 876 003 13 206 2 885 209 2 654 116 (235 0 )
Culture — recreation:
f Library 462 164 155 844 7 510 625 518 7 073 632 591 640 230 7 639
Parks and recreation 996 174 236 425 28 037 1 260 636 9 498 1 270 134 1 28L264 19 130
1 458 338 392 269 35 547 1 886 154 16 571 1 902 725 1 929 494 26 769
Public safety:
Police 4 223 843 482 712 53 600 4 760 160 7 653 4 767 813 4 727 630 (40 183)
Fire 2 619 526 246 206 9 001 2 873 733 3 789 2 877 522 2 905 093 27 571
Harbors and beaches 914 799 133 182 20 8B2 1 068 863 6 225 1 075 088 1 181 402 106 314
Building 51:1 210 37 433 30 972 609 615 1 140 610 755 632 512 21 757
Other 40 468 188 956 52 z29 476 2 872 232 34B 273 112 40 764
8 339 B51 1 08fl 489 113 50T 9 541 847 21 679 9 563 526 9 T19 749 15.6 22
Highway. sanitation
and waste removal:
Streets 1 030 107 906 693 101 888 2 038 688 12 861 2 051 549 2 345 816 294 267
Engineering 692 248 55 430 11 219 759 897 693 759 590 741 830 (17 760)
Ots,cr _438_ 1323 976 540 25 743 1 442 306 5 346 1 447 652 1 545 260 97 628
2 160 378 1 940 661 138 650 4 239 891 18 900 4 258 791 4 632 926 374 135
Total 411 34� $4 675 054 $472 514 Sl8 5�rA S7O = i16 6L4 2" $IS 9�5 23 „Qi
See accompanying notes.
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CITY F HVN^.INa"M BEACH
STAT=`9NT OF EXPENDITURES AND E"CUMANCES
COMPARED WITH APPROPRIATIONS - SPECIAL MENUE FUNDS
For The Year Ended June 30. 1974
C1vic Planned youth
Speclal Perks And Inprove- Local Revenue mpnoT-
aas T.ax Recreatlsn sent Sever aralaage Grant Snaring Service
Total Fund Fang Pund rand Pund Pund Ft--kd pund
Original appropriations (tote ID) 88 210 434 $1 211 0a0 i 40 coo t2 631 679 !32_ `U 4b5 3365 199 3947 T79 $1 987323g2 $19 4a0
Expenditure* 5 122 568 940 295 627 648 1 065 D02 197 420 793 913 1 022 578 461 062 14 66C
Fncu=brancen 1 293 202 284 085 2n3 614 244 528 20 4CT 271 156 363 3134
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Tool expenditures and encumbrances 6 415 77a 1 2:1 390 8ji 262 1 109 530 21oLBIT 971 069 1 022 578 024 456 I+ 678
Unencumbered balance all 4 664 (Sli 30u) (#U1 2b2) 31 2? 1 4 SIo�M {s
See accompanying notes.
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CITY OF HUNTINGTON BEACH
WATER UTILITY FUND
I � STATEMENT OF INCOME - BUDGETED AND ACTUAL
For The Year Ended June 30, 1974
Over
(Under)
Bum Actual Budget
Operating revenues:
Metered water sales $2 527 500 $2 269 258 ($256 242)
Other water sales 63 500 89 277 25 777
2 591 000 2 358 535 (232 465)
Less, Operating expenses 2 008 830 2 QZ8 646 6
Net operating income 82 170 279 881 ( 02 281)
Add nonoperating income:
Interest income 65 500 50 202 (15 298)
Acreage Fees 75 000 19 603 (55 397)
Tract fees 75 000 62 793 (12 207)
New service 70 000 85 639 15 639
Other 6�p 024 52 930 094)
i 345 524 272 167 (4 )
Less, Nonoperating expense:
Bond interest 105 433 111 308 5 875
Fiscal agent fees 1 920 1 344 (576)
Other 20 000 6 961 (1 0 )
127 353 119 615 (7 733)
Net income $IQLJ.4A $11L44A ($ U
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See accompanying notes.
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CITY OF HUNTINGTON BEACH
WATER UTILITY FUND
ANALYSIS OF CHANGES IN RETAINED EARNINGS
For The Year Ended June 30, 1974 i
Balance of retained earning3, July a , 1973 $4 079 190
Add:
i Net income for the year ended June 30, 1974 431 441
Reduction in reserve for 1955 0. 0. bonds 35 000
Less transfers to general fund (4. 2 550)
Balance of retained earnings, June 30, 1974 $4
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See accompanying notes. j
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CITY OF HUNTINGTON BEACH
WATER UTILITY FUND
SCUEDULE OF OPERATING EXPENSE - BUDGETED AND ACTUAL
For The Year Ended June 30, 19711
Under
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Budget Actual Budget
Water source:
Purchase of water $350 000 $509 263 ($159 263)
Materials, supplies and service 7 580 0 162 (582)
• Total water source 357 580 517 42 (159 845)
Wells and treatment plant:
Labor 47 500 43 347 4 153
Pump tax 300 000 220 488 79 512
Materials, supplies and service 1120 10 082 7 088
Total wells and
treatment plant 459 6 0 368 917 90 75
Transmission and distribution:
Labor 177 504 164 652 12 652
Materials, supplies and service 10 340 1 11 4 1)
Total transmission and
distribution 187 844 17L96 ,7 881
Customer accounting:
Labor 25 000 25 038 (38)
Accounting 118 200 111 155 7 045
Uneollectible accounts 4 000 34 487 (30 48 )
Total customer accounting 147 200 170 680 (23 480)
Administr44ion and general:
Labor 23 926 4e 787 (18 861)
Leases 108 410 19 882 88 528
Other 104 200 1082 8 (4 789)
236 536 1 1 6 8 64 878
Depreciation 63 o 000 389 840 (29 840)
in-lieu tax 260 000 28- 0 163 (20 16 )
Total operating expense $2,000Q 8-0 $2 078 §4k ($6 87 )
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See accompanying notes.
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CITY OF HUNTINGTON BEACH
WATER UTILITY FUND
i STATEMENT OF CHANGES IN FINANCIAL POSITION
For The Year Ended June 30, 1974
Fund were provided by:
Net Income $431 441
Plus items not requiring
working capital - depreciation 282 84o {I
821 281 I
'i Funds were used for:
Additions property and equipment 356 653
1963 water revenue bond repayment 100 000 i
Transfer to general fund 42 550
Other 2 502
501 _7 5
I::rease in working capital U
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Changes in working capital are uompri.sed of:
Cash 150 142
i Cash advanced to fiscal agent 17 142
.'accounts receivable, net 51 383
Due from other funds (1 274)
General payables (21 763)
Payroll payables (5 160)
Due to other fundr: 119 745
Other liabilities 6 000
Matured interest payable 3 361
Increase in working capital $ 1
•
See accompanying notes.
21
I
1
CITY OF HUNTINGTON BEACH
NOTES TO FINANCIAL STATEMENTS
June 30, 1974
M
{
1. Summary Of Accounting Policies:
M A. Method Of Accounting:
The City, like most municipalities, uses a modified
accrual basis of accounting under which expenditures
are recorded when incurred and revenues are generally
recorded when received.
B. General Fixed Asseta:
The General Fixed Assets acquired by the City prior to
July 1, 1973 are not recorded on the City's books.
General Fixed Assets, except municipal improvements
i other than buildings, acquired since July 1, 1973 are
recorded at cost on the City's books. !I
C. Water Utility Plant, Property And Eciuipment And Depreciation:
The accounts for the water utility plant include $17,970,235
• of property and equipment, less $2666,651 accumulated
depreciation. Of the total $17,976,235, $9,596 837
represents capital outlay at cost and $8,373,39A represents
an amount for assets contributed to the City through
June 30, 1968 by subdividers, at values estimated by
City personnel. Contributions by Subdividers since
0 June 30, 1968 are not recorded on the books of the
City. Depreciation is provided on the straight-line
method over the estimated useful lives of the assets.
D. Ap`02riations:
« The City adopts a budget annually which appropriates amounts
for each department or division. As of year-end the City
Council revises these appropriations. Amounts included in
the financial statements represent original rather than
revised appropriations.
• E. Raserve For Encumbrances :
The City records obligations in the form of purchase orders,
contracts and other commitments which are chargeable to an
appropriation and for which a part of the appropriation is
reserved. They cease to be encumbrances when the actual
liability is incurred. !
I*
Continued
I
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22
e
I
CITY OF HUNTINGTON BEACH
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 19711
1. Summary Of Accounting Policies, Continued:
ie1 F. Special Assessments:
The City has numerous local improvement districts and
maintains a separate special assessment fund for each.
The City records the monies received and disbursed for
the construction of the improvements for which the
District was created, and the receipt and disbursement
of monies handled for the payment of interest on and
retirement of principal amounts of the bonded indebtedness
in the respective funds. The City acts only as a fisca3.
agent.
• G. Federal Grants, Revenue Sharing, Etc. :
The City maintains restricted use funds and special revenue
funds to comply with requirements of state and federal
statutes stipulating that monies apportioned to the City
be spent only for certain desi nated functions. During the
i fiscal. year ended June 30, I M, the City received monies
from the federal government under revenue sharing which
has been accounted for in a separate fund.
H. Pension Plan:
City employees participate in the Public Employees'
Retirement System (administered by the State of California)
which plan covers substantially all employees. The total
pension expense recognized by the City for the fiscal year
ended June 30, 1974 was $975,000. The excess, if any, of
the actuarially computed value of vested benefits over the
total of the above pension fund is not available.
s
I. Vacation And Sick Leave:
The City expenses vacations as they are taken rather than
as vested. The present vacation policy is that the vacations
p vest- as earned with certain limitations. At June 30, 1974
the total vested vacation was approximately $765,000.
The City also expenses sick leave as taken rather than as
vested. At June 30, 1974 the total vested sick leave was
approximately $305,000.
s
Continued
23
CITY OIL HUNTINGTON BEACH
NOTES TO FINANCIAL STATEMENTS) Continued
i June 30, 1974
2. Cash:
•
At June 30, 1974 cash consisted of the following:
Active bank accounto $163 670
Time certificates of deposit 6 830 000
i Temporary investments in
U.S. Government securities,
at cost, which approximates
market 1 125 000
Cash on hand 3 010
3. Bonded Debt Not Matured:
Matured/
Balance Retired Balance
i Original Not Matured During Not Matured
Amount July 13 1973- June 30,
Issue Sold 1973 1974 — 1974
General Obligation
Bones`
1970 park bonds,
wi`,h interest
rates 5.5% to
6%. Maturing
annually on
i March 1 in
varying amounts
with final
maturity in
1995 $6 000 000 $5 650 000 $130 000 $5 520 000
1955 water bonds
• with interest
rates 2% to 3%,
maturing on
August 1, in
installments of
f • $35,000 to 1980 860 000 280 000 000 245 000
I $L=L= $ 000 $ I.CQ $5 765 0020
Continued
i 211
; 0
C11'Y OF' 11UNTINGTO1,1 BEACII
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 19711
3. Bonded Debt Not Matured, Continued:
Matured/
Balance Retired Balance
Original Not JatUred During Not Matured
Issue mount
July 1, 1973- June 30,
id _29-L31— _4 1974
Revenue Bonds:
1963 water
revenue bonds
Series A,
3.29% to 4.75%
41 maturing annually
on November I
In varying
amounts with
final maturity
0 In 1993 $.U50 000 $Z.-260 000 $120-0.00 $3.=J0.0.2
The general obligation bond balance of $5,765000 represents a
future liability of the City. The $3s160,000 water revenue
bonds do not represent a general liability of the City of
Huntington Beach.
0 At June 30, 1974 there were $1,950,000 authorJzed but unissued
1963 water revenue bonds.
Special assessment district bonds outstanding totaled $57,324.
See Note IF.
0 4. Long-Term Leases Payable:
Civic Center $8 386 437
Central Library - 2 179 441
$10 5,65 8Z8
Civic Center:
The City has entered into a noncancellable lease and sublease
agreement with the Huntington Beach Public Facilities Corporation
for the Huntington Beach Civic Center. The City has leased
to the corporation the civic center site for $350$000 advance
rental. Term of the lease is from January 15, 1972 to one week
after the termination of the sublease.
Continued
25
WE
D
CITY OF HU11TINGTON BEACH
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 1974
4. Long-Term Leases Payable; Continued:
The corporation has subleased the civic center site and
improvements to the city for $854,900 annual rental.
The sublease commenced July 19 1974 for a term of 30 years
or until after all debts of the corporation related to the
civic center have been discharged., whichever comes first.
Central Library:
The City has entered into a noncaricellable lease and sublease II
agreement with the Huntington Beach Public Facilities Corporation
for the Central Library. The City has leased the site to the
corporation for $300000 advance rental. Term of the lease
is from September 1, 1972 to one week after termination of
the sublease.
The library is currently under construction and is projected
to be completed in 1975 at which time the city will take
possession and the sublease will commence for a term of 30 years
or until all debts of the corporation related to the library
have been discharged, whichever comes first. Annual rental
under the sublease will be $399,000.
The City is to pay all taxes, insurances administrative and
maintenance costs under the leases. Title to site improvements
will pass to the City at the termination of the leases. The
leases are deemed to be financing arrangements with the related
costs of land and buildings (equivalent to the future rental
payments discounted at approximately 8k%) being recorded In
the General Fixed Asset,- and the lease commitments being
recorded in general long-term debt. Advance rentals received
by the City are recorded as deferred rental income and will be
amortized over the terms of the sublease.
5. Contracts Payable:
The City has water, sewer and drainage reimbursement agreements
which provide for reimbursement to developers of cost incurred
in constructing water, sewer and drainage facilitlee to the
extent fees are collected from users of the facilities. The
City follows the practice of recording the fees as a liability
as they are collected and charges payments to developers under
the agreements to a liability account.
Continued
26
r
CITY OF HUNTINGTON BEACH
NOTES TO FINANCIAL STATEMENTS, Continued
i � June 30, 1974
6. Commitments And Contingencies:
The City has entered into lease agreements as follows :
t� (a) Water storage capacity in the San Joaquin
I Reservoir for a term of 50 years commencing in 1967.
(b) Parking facilities from the Huntington Beach
Parking Authority commencing in 1969 for a term
of 24 years or after all of the 1968 revenue bonds
of the Authority are retired.
(c) Park site from Ocean View School District commencing
» June 19$ 1974 for a term of five years. The City
may cancel the lease at the end of any budgetary
year. If the City makes all lease payments during
the five-year period title to the property will pass
to the City.
The minimum annual rental commitment under the above
leases is as follows:
1975 $334 925
1976 334 925
1977 329 925
1978 329 925
1979 265 050
Five years
1980-1984 1 325 250
! Five years
1985-1989 1 310 25C
Five years
1990--1994 1 050 200
Remainder 220 000
I
i
Continued
10 27
lid
CITY OF HUNTINGTON BEACH
NOTES TO FINANCIAL STATEMENTS, Continued
June 30, 19711
6. Commitments And Contingencies, Continued:
As of June 30, 19711 the City is defendant in a number of
suits arising in the normal course of business and covered by
insurance. In addition to the above suits there is a class
action suit against the City in the amount of $89000,000 for
which, according to the office of the City Attorney, settle-
ment is being proposed through the payment of attorney's fees
in tha sum of $300000.
As a result of a police helicopter ~rash in August 1964, the
City has beer named in two suits totaling $1,750000.
Maximum insurance coverage is $1,000,000. Outcome of the suits
is not known at this time.
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