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HomeMy WebLinkAbout1984-06-05; City Council; 7767; 1983-84 financial statements auditor selection0 - J7J: Clt- OF CARLSBAD - AGENL BILL 4B#,-- HTG. 6-5-84 FT.. SELECTION OF CITY AUDITOR FOR TITLE AUDIT OF THE 1983-84 FINANCIAL IEPT. 'IN I STATEMENTS DEPT. HD. I CITY ATTY Dc6 RECOMMENDED ACTION: Adopt Resolution No. 7618 for audit services for audit of the Citv's 1983-84 financial statements and accepting the proposal of Deloitte, Haskins & Sells authorizing the City Manager to issue a' letter indicating the City's intent to utilize the services of Deliotte, Haskins and Sells for the audit of the City's financial statements for the fiscal years 1984-85 through 1987-88. ITEM EXPLANATION The City of Carlsbad annually prepares financial statements which must be audited by an independent certified public accountant. various qualified firms for the preparation of these statements and audit services every three to five years. During the past three years, the City has used the services of Conrad and Associates, a CPA firm located in Newport Beach for the annual audit. The City requests proposals from This year, the City requested proposals from eight firms and received four responses. These responses are summarized below: COMPANY Arthur Young & Company Peat, Marwick, Mitchell & Co. Coopers & Lybrand Deloitte, Haskins & Sells Conrad & Associates Earnst and Whinney Laventhal & Harwath Arthur Andersen & Co. AUDIT PRICE $15,000 9,000 9,003 Declined to bid No response No response No response 11,000 The four proposals received were reviewed by the Assistant City Manager and the Finance Director. Marwick and Deloitte, Haskins and Sells. capable of providing high quality audit services as well as management related services. Interviews were held with representatives of Arthur Young, Peat, The staff's goal was to find a company The staff is recommending that the City Council accept the proposal of Delo Haskins and Sells. All firms had very good qualifications. In the staff's the audit services could be performed equally well by all firms. Deloitte, and Sells has a stronger local management support staff which will prove to important to the City in the next year as we begin to tackle areas of organ cash management, procedure audits and other projects. FISCAL IMPACT tte, opinion, Has ki ns be zation, The proposed price for the 1983-84 audit services is $9,000, which can be covered from the $15,000 included in 1984-85 operating budget for audit services. additional $5,000 budgeted next year will be used to cover costs for management services outlined above. The EXHI BITS Resolution No. 76 If . I. 8. 1 3 4 6 7 9 11 12 14 15 24 2E - RESOLUTION NO. 7618 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, ACCEPTINC THE PROPOSAL OF DELOITTE, HASKINS PND SELLS, CERTIFIED PUBLIC ACCOUNTANTS, FOR THE PUDIT OF THE CITY'S 1983-85 FINANCIAL STATEMENTS PND PUTHORIZINC THE CITY MANAGER TO ISSUE A LETTER AGREEMENT FOR SAID SERVICES. WHEREAS, the City annually contracts with a certified public accountant licensed in the State of California for the audit of the City's annual financial statements; and WHEREAS, the City has requested proposals from eight qualified firms for such audit services; and WHEREAS, after reviewing proposals from these firms, the City staff has recommended that the City Council accept the proposal of Deloitte, Haskirw and Sells; and WHEREAS, funds for these services are contained in the 1984-85 operat hg budget . NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbad that the proposal of Deloitte, Haskins and Sells is hereby accepted, and the City Manager is authorized to issue the attached letter agreement to Deliotte, Haskins and Sells for the performance of said services. PASSED, APPROVED AND ADOPTED at a regular meeting of the City Council of the City of Carlsbad, California, held on the 5th day of J- 9 1984 by the following vote, to wit: AYES: Council Menhrs Casler, Lewis, Kulchin, Chick and presmtt NOES: Nh.le ABSENT: RXE MARY H. ER, Mayor ATTEST: kzdL 4P- ALETHA L. RAUTENKRANZ, City Clerk] (SEAL) . 1200 ELM AVENUE CARLSBAD, CALIFORNIA 92008 Office of the City Manager 3une 5, 1984 Frank Panarisi Regional Government Services Coordinator Deloitte, Haskins and Sells 701 B Street Suite 1900 San Diego, CA 92101-8198 Dear Mr. Panarisi: TELEPHONE: (714) 438-5561 The City of Carlsbad has accepted your proposal for audit services dated April 19, 1984. Under the terms of this engagement, you will perform the audit services and submit reports by the dates specified in the attached request for proposal. fee for this engagement shall be $9,000. The This engagement may be extended from year to year by the City without further action by the City Council unless notified in writing by the City through the audit of the City’s 1987-88 financial statements. The price for these future engagements shall be set as described in page 46 of the proposal. We appreciate your interest in providing these services to the City of Carlsbad and look forward to a very valuable relationship between the City and Deloitte, Haskins and Sells. Sincere1 y, FRANK ALESHIRE City Manager FA/ds ,- A 1200 ELM AVENUE CARLSBAD. CALIFORNIA 92008 I. TELEPHONE: (7 14) 438.555? April 4, 1984 Citp of CsrImsbab FINANCE DEPARTMENT The City of Carlsbad invites qualified independent public accountants to submit proposals for the performance of an audit of its financial accounts and records covering the period July 1, 1983 to 3une 30, 1984, for the purpose of rendering an auditor's opionion regarding the fairness of applicable financial statements and the compliance of the City of Carlsbad with applicable legal provisions, in accordance with generally accepted auditing standards. GENERAL INFORMATION The City of Carlsbad is a municipal corporation of the State of California. principal mnicipal funds and departments (shown in Exhibit A), all of which will be subject to this audit, have a total appropriation of $30 million. City staff includes 312 fulltime and numerous part time employees. revenues for 1983-84 will exceed $26 million. The The Estimated The most recent audit of the City of Carlsbad was performed in 1983 for the period 3uly 1, 1982 to 3une 30, 1983. The City received the California Society of Municipal Finance Officer's Award for outstanding financial reporting for 1981-82 and has submitted the 1982-83 report to the Municipal Finance Officers Association (MFOA) for review under the certificate of conformance program. A copy of this report is available from the Finance Director at the above address. The City's accounting system is maintained on a Hewlett-Packard 3000 computer system using software, which, in the past, has provided only basic accounting data. A significant aunt of manual effort has been required to prepare audit schedules and work papers from the data provided. new accounting system as of April, 1984, which will provide better access to detail and summary data. The City is converting to a The City's accounting and reporting system designed to comply those described in Governmental Accountinq, Auditing and Financial Reporting (GAAFR), published by the MFOA. ' .' .. PERFORMANCE SPECIFICATIONS The following specifications cover the key areb of interest to the City. Please 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. -. indicate to what extent you will be able to meet these specifications: The audit shall be a financial and compliance review of - all City funds, and the auditor shall issue an opinion letter on the City's financial statements and compliance with applicable legal provisions. The audit shall provide a seperate compliance review of the City's revenue sharing fund activity and the auditor shall issue a seperate opinion letter on the City's compliance with revenue sharing regulations as required by the Office of Revenue Sharing. The audit shall include a compliance review of the City's Redevelopment Agency activity and the auditor shall issue a seperate report and opinion letter for the Redevelopment Agency's financial statements. The auditor shall issue a seperate opinion and report on the City's Water Enterprise Fund and financial statements. The firm shall adhere to generally accepted auditing standards. The audit shall cover the period 3uly 1, 1983 to 3une 30, 1984. The firm shall submit a final draft of its audit report no later than September 28, 1984. The City will utilize its staff, where possible, to provide assistance to the audit staff, consistent with generally accepted auditing standards. However, City assistance may be limited by available staff members. The financial statements on which the firm shall express an opinion are shown in sections 1, 2, 3, and 4 above. The City of Carlsbad expects to prepare these statements in accordance with guidelines provided in GAAFR with assitance, where allowed by generally accepted auditing standards, from the firm. The City also expects the firm to assist in the preparation (but not the audit) of the supplementary schedules contained in the City's annual financial report. The firm shall suhmit a draft written report on internal accounting control weaknesses, if any, not later than October 5, 1984. .. 11. The firm shall submit a draft management letter no later than October 5, 1984 which shall identify management or system weaknesses observed, assess their effects on financial management or City operations, propose initial steps towared eliminating these weaknesses and shall include responses to these comments by the affected department heads. Areas of particular interest include internal finance department organization, purchasing systems, accounts payable systems, payroll systems, cash management functions. 12. If the auditor wishes to have the City type all schedules and statements which will be included in the annual financial report, the firm shall have draft copies of all statements prepared by September 14, 1984. If the firm proposes to do all typing with the firm's staff, the firm shall supply two unbound final original copies of the auditor's report, financial statements and supplement schedules by October 5, 1984. 13. The partner in charge shall be available to attend up to three public meetings at which the audit report may be discussed. 14. The firm shall make available its working papers to the City of Carlsbad, federal agencies, state agencies and other parties upon the direction of the City. 15. The firm shall hold an exit conference with the City staff within ten working days of the submission of the final report documents. - . - . - - - - . - - . !GTRUCTIONS REGARDING PROPOSALS rte firm shall submit two (2) copies of the proposal to games F. Elliott, inance Director, City of Carlsbad, at the above address before 5:OO p.m. on -.xi1 20, 1984. --.. . - -roposals must include : 1 . Qualifications of the firm: a. Description of the firm and relevant prior experience. b. At least three references which shall be officials of municipal governments, including addresses and phone nuhers. c. A description of the partner, manager, and key staff to be assigned to this engagement inlcuding their resumes. d. A description of the firms ability to perform management oriented services other than audit services. e. A description of the firms management consulting experience and staff . , .. '. . 2. Technical Approach: a. Express agreement to meet or b. A tentative schedule for the described above. audit . excpd the performance specifications performance of the key phases of the c. A brief description of the audit procedures to be followed and particular emphasis of the firm in performing the audit. 3. Fees: a. The maximum fee your firm will charge the City for the audit and hourly rates for each level of staff if the City were to authorize an expansion of scope for this engagement. b. Fees the firm will charge for other types of management consulting serivces. EVALUATION PROCEEDURES The City's Audit Committee inlcuding the Finance Director, City Treasurer and Assistant City Manager will evaluate the proposals on the basis of qualifications, relevant experience, and the responsiveness of the bidders, as well as the cost of the engagement. The Committee may elect to perform oral interviews of certain firms during the evaluation process. The Committee's recommendation will be presented to the City Council on or about May 1, 1984. FURTHER INFORMATION Please feel free to contact games F. Elliott, Finance Director, at (619) 483-5626 if you need any further informationn. visit the F inance Department for an on-site inspect ion at your opt ion. Also, you are welcane to 3FE/ds Attachment s DECEMBER 11, 1984 TO : CITY MANAGER FROM: Finance Director 1983-84 ANNUAL FINANCIAL REPORT The 1983-84 annual financial report for the City of Carlsbad has been presented to you for your review. This report is presented in the format dictated by the accounting profession and, therefore, may not provide the type of data of interest to the manager or City Council. The following sections summarize the data presented in the annual report from a different perspective and includes some historical data for comparison purposes. THE CITY IN TOTAL During 1983-84 the City received $30.1 million in revenue from all sources. This was $7.2 million or about 31% above the 1982-83 total revenue of $22.9 million. During 1983-84 the City experienced a sustained period of building activity which began in late 1982-83. Building activity produces a number of fees such as the building permit fee, plan checking fees, business license fees, and capital fees which are received in advance by the City. The City then uses these fees to finance future demands for services and capital facil- ities. The chart below provides a comparison of total revenue for the City over the past five years. - CIlY OF CARLSBAD TOTAL CITY REVENUE - ,MILLION DOLLARS , TOTAL RMNUE 30 20 10 0 1979-80 1980-81 1981-82 1982-83 1983-84 F I SCAL YEAR TOTRN -2- For 1983-84 the total revenue Of $30.1 million was divided between the various funds as shown in the chart below. The general fund received about 56% or $16.9 million Of the total. Enterprise funds received about 20% or $5.9 million, capital funds received 13% or $3.8 million and special revenue funds received about 11% or $3.3 million out of the total.Revenue necessary to meet the City’s outstanding general obligation debt totaled only 0.3% of revenue or about $100,000. CIN OF CARLSEAD TOTAL REVENUE - ALL FUNDS - 1983-84 ENTERPRISE 19. PIT& 12.7% DEBT SERVICE 0.3% GENERAL 56.5% I 16.9 total VALUES IN MILLION DOLLARS Total expenditures from all funds for 1983-84 reached $21.2 million. This is about $2.1 million or 11% above the 1982-83 total of $19.1 million. The chart below provides a five-year comparison of expend- itures from all sources. When reviewing this chart it is important to remember the total includes capital funds which have expenditure patterns that vary widely from year to year, depending on the projects under constructionduring that year. --- CITY OF CARLSBAD TOTAL CIN EXPENDITURES - ALL FUNDS TOTAL EXPENSES E” %d*. Y” A MILLION DOLLARS i FISCAL YEAR TOTEXP x CITY OF CARLSBAD COMPARISON OF CASH BALANCES - ?E& FISCAL YEAR i ~ -3- CIN OF CARLSBAD TOTAL CASH - BY FUND 1983-84 AQ)(CY 8 5% 24 SPEC I hL RMNLE 16 7% IlmRlUL SERVICE 6.m 17 DEBT SERVICE 5 R 16 Q)(ERK 1 4% 04 ENTERPRISE 18 9%- 53 I t' \ CAPITAL 42 7% 12 ( VALUES IN MILLION WWRs ) TOTAL CASH - $28 1 YlLLloW ULC*W -_ __~ _--- -- Total expenditures for 1983-84 break down as follows: General fund $13.2 million--63% of total expenses,enterprise funds $4 million--19% of total expenses, special revenue funds $2.8 million--13.3% of total expenses, capital funds $600,000--2.8% of total expenses and debt service $500,000--2.4% of total expenses. CITY OF CARLSBAD TOTAL EXPENDITURES - ALL FUNDS - 1983-84 TOTEXPP I ENTERPRISE 19.OX, GENERAL 62.6% 1 - 13.2 VALUES IN MILLION DOLLARS SPEC I AL REVENUE 13.3% 2.8 CAPITAL 2.8% 0.6 DEBT SERVICE 2.4% 0.5 Total revenues exceeded total expenditures by about $8.9 million, primarily due to building-related fees in several areas. This brought the 1983-84 cash balances to $28.1 million. Much of this cash is reserved or pledged to various capital projects. Of the total $28.1 million, $400,000 is related to general fund obligations. The remaining $27.7 million is technically reserved for capital projects, enterprise fund operations, grants or special revenue activities, deposits from other agencies or companies, internal service fund operations,or debt service payments. Council has discretion as to when and how these funds are to be spent. Although in mqny cases, the type of eligible expenditure is limited by law. -4- GENERAL FUND The City's general fund revenue totaled $16.9 million during 1983-84. This total was about $3.9 million or about 30% above the 1982-83 total revenue of $13 million. The general fund saw growth in many areas, as shown below: SELECTED GENERAL FUND REVENUE SOURCES (In Million Dollars) 1983-84 1982-83 1983-84 Over (Under 1 % Source Revenue Revenue 1982-83 Change Property Tax* Sales Tax Transient Tax $ 4.3 $ 4.6 $0.3 $ 7.0 4.0 4.9 0.9 22.5 0.8 1.0 0.2 25.0 *Including property tax reimbursements Construction Permits 0.5 1.1 0.6 120.0 License Tax on New Plan Check Fees -- 1.0 1.0 0.4 1.0 0.6 150.0 0.4 0.3 300.0 Construction -- Engineering Fees 0.1 - TOTAL : .- $10.1 $14.0 $3.9 $ -- - - Although the above table includes only a few selected revenue sources, these sources comprise a major part of the City's general fund revenue and provide a good picture of where growth has occurred over the past year. During 1983-84 the City's economy maintained strong economic growth which is indicated by the large increase in sales tax, transient tax, and development-related revenues. This growth trend began in the later part of 1982-83 and contained through 1983-84. General fund revenue was comprised and permits,l3% fees for services. in the form of interest, fines or CITY OF CARLSEAD GENERAL FUND RMNUES AND EXPENDITURES RMNUE - MILLION DOLLARS EXPENSE - CENRMXP ~ of about 67% taxes, 15% licenses The remaining 5% was received other minor sources of revenue. GENERAL FUND REVENUE - 1983-84 ( VALUES IN MILLION WLURS ) NS 12 SX 22 INTEREST 3 08 FINS 1 OX 03 0-R 0 6% 01 11 4 I I 1::- TOTAL RMNUE $16 9 MILLION -5- PROPERTY AND SALES TAX REVENUE 1976-77 TO 1983-84 - - T3P w MILLION DOLLARS 1 -II 4 3 2 1 76-77 77-78 78-79 79-80 80-61 81-82 82-83 83-84 FISCAL YEAR 1 PRWSALE BUILDING PERMIT REVENUE 1981-82 TO 1983-84 - $&;I& THOUSAND DOLLARS 7 1981-92 1982-83 1983-84 BPREVDET -6- General fund expenditures totaled about $13.2 million, $1.2 million or 10.0% above the 1982-83 expenditure of $12.0 million. Growth in expenditures has been summarized, as shown below: EXPENDITURES (In Million Dollars) General Government Public Safety Public Works Culture & Recreation TOTAL EXPENDITURES: 1982-83 1983-84 Expenditure Expenditure $ 2.2 $ 2.5 5.3 6.0 1.9 1.9 2.6 2.8 $12.0 $13.2 Increase (Decrease) $0.3 0.7 -0- 0.2 $1.2 - - - % Change 13.6 13.2 -0- 7.8 10.0% The chart below summarizes total general fund expenditures by type. A major portion of the general fund expenditures are for public safety-- 46%. Of the remainder, about 19% goes to general government, 14% to public works,13% to parks and about 8% to Libraries. CllY OF CARLSEAD GENERAL FUND EXPENDITURES - 1983-84 PUBLIC WORKS 14.4X1 GENERAL 1 COV’T 18.9X 2.5 12.9X -LIBRARY 8.3~ 1.1 UNEXPP I TOTAL EXPENDITURES - $13.2 MILLION CAPITAL FUNDS The City has several funds reserved for the construction of capital facilities from specific fees or revenue sources. During 1983-84 the City received about $3.8 million in capital revenues. These revenues are collected primarily from developers who pay the City at time of construction for future improvements. These capital fees fall into three major categories; the public facilities fee, the park-in-lieu (also known as park development) fees and the planned local drainage facilities fees. I -7- Two capital sources, public facilities fees and park-in-lieu fees, are shown on -the following graph. In addition, the revenue from sewer construction fees has been included for comparison purposes. Revenue from public facilities fees grew from $664,000 in 1982-83 to $2.3 million in 1983-84, an increase of about 246%. This pattern was followed by sewer construction revenceswhich increased by 153% from $657,000 in 1982-83 to $1.7 million in 1983-84. Park-in-lieu fees, however, did not experience the same growth due to two factors: first, not all developers pay park-in-lieu fees and, second, both Calavera Hills and LaCosta developers have dedicated land rather than paying fees. 1979-80 TO 19a3-84 CmS r 1 PARK DEV FEES - PU9LlC FAC mS - kssssm THOUSAND DOLLARS FISCAL YEAR Capital expenditures do not follow the same pattern. The spending of these capital funds generally occurs in large blocks due to the nature of capital projects. As the chart below shows, the City spent large amounts of capital funds during 1980-81 and 1981-82 for the construction of the expansion of the Encina Water Pollution Control Facility and the acquisition of land for parks and the safety center. In other years, relatively small amounts of capital funds have been expended. . -8- I -' 3000' ZWO 1000, 0. .- r-* f 1 ii I) 9: :' f. F, 1 I 4 LS rn k7 During 1983-84 about $132,000 of public facility fees and about $361,000 of general capital construction funds were spent on various capital projects. CAPITAL EXPENDITURES 1979-80 TO 1983-84 c.xs3 - "PEEP CSm I t?zxa COSF&€S W I FAC ws I THOUSAND DOLLARS 5000 bylabout $1 million from $657,000 in 1982-83 to $1.7 Proprietary expenditures totaled about $4 million or (8%) above the 1982-83 level of $3.7 million. Water expenditures make up the majority of these expenses. CITY OF CARLSEAD PROPRIETARY FUNDS REMME EXPENSE Esssss - MILLION DOLLARS 4 2 0 FISCAL YEAR L - - million in 1983-84. about $300,000 and sewer I t -9- The water enterprise recorded a $58,000 net income for 1983-84 for 1983-84, while the sewer enterprise shows a $1,990,000 net income. The sewer net income figure includes $1,660,000 of sewer construction fees paid to the City for future improvements to the sewer system. SUMMARY The City of Carlsbad hs completed a year which included substantial growth which was the result of an improved economy for building and development and for consumers. This improvement follows several years of slow growth and a stagnant or declining economy for much of the nation. The growth in Carlsbad's revenue sources and in the rate of building arebeing compared to one of the slowest periods Carlsbad has experienced. The recovery has effected tax revenue,development revenue, and fees for services. The City has not, however, been required to provide all the services or capital facilities paid for during 1983-84. the .City can expect demands for services during the next year to two years that were paid for in 1983-84. will likewise lag the receipt of funds. the high levels of revenue received in 1983-84 will be required in later years to finance City operations and capital projects. The demand for capital facilties .. ,~. - / I ,I . CI /s I '4 JAMES;. ELLJOTT Finance Director jfFEYmmt I Delfle Has kins+Sells STATEMENT OF QUALIFICATIONS AND PROPOSAL TO SERVE CITY OF CARLSBAD Debitte Haskins+Sells 701 "6" Street Son Diego, California 92101-8198 (619) 232-6500 Robin J. Jensen Senior Consultant MaMgement Advisory Services APRIL, 1984 Haskins-tSells Mr. James F. Elliott Finance Director City of Carlsbad 1200 Elm Avenue Carlsbad, California 92008 Suite 1900 701 "6" Street San Diego. California 921 01 -81 98 (61 9) 232-6500 TWX 91 0-335-1 573 April 19, 1984 Dear Mr. Elliott: We are pleased to submit our Statement of Qualifications and Proposal to serve the City of Carlsbad. Our firm has the full range of accounting and consulting services to assist you in meeting the many challenges presented to your progressive and growing city. We believe our proposal is fully responsive tP your Request for Proposal, and can assure you that our firm would be fully responsive to any and all of the City of Carlsbad's needs. Please feel free to contact me at (619) 232-6500 should you have any questions regarding our proposal. We look forward to hearing from you. Sincerely, William F. Waina Partner r STATEMENT OF QUALIFICATIONS AND PROPOSAL TO SERVE THE SITY OF CARLSBAD TABLE OF CONTENTS Section I. EXECUTIVE SUMMARY A. Understanding of Work B. Management Issues C. Experience and Resources D. Approach E. Engagement Team F. Summary 11. PROFILE OF OUR SAN DIEGO OFFICE A. Our Personnel B. Our Clientele C. Our Service Approach D. Our National and International Organization E. Stability 111. GOVERNMENT EXPERIENCE AND QUALIFICATIONS A. Local Governments B. State, County and Local Agencies C. Programs Financed by the Federal Government D. Municipal Securities Offerings E. Educational Programs F. Government Resources G. Professional Recognition IV. ENGAGEMENT ORGANIZATION AND PERSONNEL A. Resumes - DH&S Engagement Team V. WORK PLAN A. Objective and Scope B. Audit Plan C. Audit Work Program 1. Planning and Control 2. Internal Accounting Control Evaluation 3. Tests of Asset and Liability Accounts 4. Tests of Revenues and Expenditures 5. General Procedures D. Advanced Audit Techniques Page 1 7 11 18 28 Section VI. MANAGEMENT ADVISORY SERVICES A. Data Processing B. Cash Management C. Management Effectiveness D. Other MAS Services VII. PROFESSIONAL FEES APPENDICES: A. References B. Affirmative Action Statement 44 46 40 I. EXECUTIVE SUMMARY EXECUTIVE S UMMARY We are extremely pleased to submit this proposal to serve the City of Carlsbad by performing a financial and compliance audit of the City's financial reports and the reports of specified agencies for the period July 1, 1983 to June 30, 1984. Our firm offers a full range of accounting and consulting services which would be most beneficial to the City with its progressive future. We believe the information provided on the following pages strongly substantiates our recommendation that the City award the audit to Deloitte Haskins &I Sells as the firm best qualified to provide the breadth and quality of service the engagement demands: timely, efficient and personalized service rendered by locally-based professionals with extensive experience in all aspects of governmental accounting and management services. We are the largest accounting and consulting firm in San Diego, with a full range of services, including audit, management consulting, tax, and small business services. Highlights of our key qualifications follow. UNDERSTANDING OF WORK Our financial and compliance audit of the City's financial reports will be performed with the objective of rendering an opinion as to the fairness of presentation of the statements. The audit will be performed in accordance with generally accepted auditing standards, as included in the American Institute of Certified Public Accountants' (AICPA) Statements on Auditing Standards and the Comptroller General's Standards for Audit of Governmental Organizations, Programs, Activities and Functions ("Yellow Book and will satisfv the Provisions of Federal OMB Circular A-102, Compliance Supplement: guidelines provided in the Municipal Finance Officers Association They will also be in accordance with TMFOA) Goveinment Accountinq, Auditinq and Financial Reportin (GAAFR) and with rules set by the Government Accounting Standzrds Board (GASB) recently approved by the Financial Accounting Foundation. Our audit scope will include the entities required to be included in the City's financial statements in accordance with National Council on Governmental Accounting Statement 3. In addition to our opinion on the financial statements, we will issue management reports and letters describing our findings with respect to any weaknesses in accounting procedures, internal or data processing controls, administrative and operating matters, and other observations concerning compliance with various pertinent regula- tions. Our approach will be to work in partnership with the City. We will comment on work done exceptionally well and also comment (formally and informally) in a positive and constructive manner on areas that can be improved. We will strive to develop a close working relationship with the appropriate City staff and officials so that you can benefit from our objective observations, findings, and recommendations. As specified in your RFP, we will also audit -1- the financial statements of the City's revenue sharing fund activity, the Redevelopment Agency, and the Water Enterprise Fund. We are also prepared to conduct any special reviews requested by the City. In addition, we will assist the City in once again meeting the requirements of the MFOA Certificate of Conformance Program. Mike Bresnan, assigned to our proposed engagement team as consulting manager, is a member of the MFOA's Certificate of Conformance Special Review Committee, and has assisted several municipalities, including the Counties of Los Angeles and Orange, in preparing for their filings for the Certificate. Both counties were granted certification. MANAGEMENT ISSUES It is our understanding that the City of Carlsbad is particularly interested in identification of management issues as part of the audit process. To a great extent, the need for continued improvement of City management is due to the growth pressures now facing Carlsbad. Growth forecasts show that the Carlsbad general planning area will experience the highest percentage of growth in the region. In fact, between 1980 and 2000 Carlsbad is expected to accommodate an additional 71,400 persons, representing a 198.9% increase. In addition to population growth, Carlsbad will show significant industrial and business development. App.roximately 17,000 commercial and industrial acres will be developed and the civilian employment will increase by 22,000 persons (135%). -. In order to cope with such development pressures, the City will require the most efficient management practices and service delivery operations, increased automation, improved financial planning and cash management, and creative financing of infrastructure needs. "Infrastructure needs" has had extensive attention in the past two years. It is evident that many public facilities are wearing out, undersized, and overused. These projects may include streets, sewers, treatment plants, beach erosion, public buildings, public-private ventures, parks etc. In Carlsbad, the infrastructure needs will be particularly critical. Most of the 10,000 acres projected to be developed (1980-2000) are not now served by infra- structure. Our Firm is extremely interested and involved in helping governmental agencies to correct the neglected infrastructure projects. We have resources now and are acquiring more which will enable us to assist a City to inventory its capital assets, classify the condition of the assets, program needed improvements, assess cost impact, identify needed additional assets, develop creative financing alternatives, and assist in the follow-through, including construction. -2- c EXPERIENCE AND RESOURCES .- e x. - “I DH&S currently serves as independent auditors for the following Southern California cities and counties: Cities Brentwood Chula Vista Irvine Orange Riverside Vernon Counties Los Angeles Orange Riverside San Bernadino San Diego We also serve a wide variety of counties, cities, municipal agencies and special districts throughout the country. Our clients include such major municipalities as New York City, Dallas, Miami, the County of Hawaii and New York’s Suffolk County (Long Island). On a local level, in addition to the City of Chula Vista and County of San Diego, we currently serve the San Diego Transit Corporation, San Diego County Department of Education, San Diego Community College District, Ramona Municipal Water District and Ramona Unified School District. In recent years we have audited public works grants for the City of San Diego and CETA grants for the County of Imperial. We have recently provided management advisory services to the County of San Diego, the County of Los Angeles, the County of Orange, the City of Los Angeles, the City of Irvine, the City of Orange, the San Diego Association of Governments (SANDAG), the South Bay Unified School District and San Diego Community College District. We also recently performed a cash management analysis engagement for the City of San Diego. Our experience in the cash management area is particularly strong, and we believe it is an area where we could be of unique value to the City. As a result of the strength of our governmental practice, DH&S has become the dominant accounting firm in the area of single audits, an area of increasing interest to governmental entities. We have completed or are currently performing 71 single audits, more than any other accounting firm or agency of any kind. Our single audit clients include 11 cities and 13 counties, including: County of San Diego County of Orange San Joaquin County City of Bloomington, Minnesota City of Gaithersburg, Maryland City of Kettering, Ohio City of Stillwater, Oklahoma Mecklenburg County, North Carolina Pasco County, Florida Suffolk County, New York -3- I - .. P- i "-, I .*- e We believe the experience and reputation earned through our single audit engagements provide clear evidence of our governmental capabilities and resources. Our extensive experience with the clients mentioned above, and with other clients in all segments of the economy, have allowed our professionals to become completely qualified to perform the full scope of services required by the City. The skills and capabilities of each individual are blended together through our team approach and backed up by the resources and accumulated expertise of our San Diego practice office and the entire Firm. DH&S is the largest accounting and consulting firm in San Diego, with a professional staff of over 100 and four departments offering a complete range of accounting, auditing, tax and consulting services. We are part of an international organization of 26,000 people in 400 offices in 71 countries. There are 100 DH&S offices in the U.S., including nine in California. Among the Firm's resources relevant to the City are our Government Services Group, our Washington, D.C. National Affairs Office and our Federal Government Grants Information Service. These resources are described in Section 111 of our proposal. APPROACH Our approach to the City audits will be, above all, a constructive service approach. Utilizing the thorough and efficient work program documented in Section V, we will perform the required services on a timely basis with minimum disruption of the City staff's activities. The sophisticated audit techniques we will use include: Municipal Audit Programs Audit Sampling Plan Statistical Techniques for Analytic Review (STAR) AUDITAPE (a group of computer programs which automatically select computer records according to our statistical sampling plan) Mini-Max, which tests for variances from independently computed amounts. These techniques are discussed in detail in Section V. We will take full advantage of these sophisticated audit tools to minimize potential exposure to the City, while at the same time limiting the required amount of detailed transaction testing through the use of statistically valid sampling techniques. We will apply materiality limits developed in accordance with our standard sampling plan, but will apply stricter standards in particularly sensitive areas or where our analytical review procedures suggest a possible problem. The specific audit procedures to be applied will vary from area to area, but will include an appropriate combination of confirmations, transaction testing and documentation reviews required to establish -4- that financial amounts are properly classified, recorded in the proper fund, and stated at reasonable amounts. These procedures will be supported by our analytic review effort, which will provide an assessment of the reasonableness of particular accounts, both in comparison to the lawful budget and the prior years' results. Our concentration of effort on significant areas combined with a sophisticated approach to auditing through a computer system should ensure the quality and efficiency of our audit effort. ENGAGEMENT TEAM The quality of service our firm offers is best exemplified by the management team we have assembled to serve the City. William F. Waina, the San Diego office partner most experienced with governmental and fund accounting clients, will serve as engagement partner, assisted by Debra J. Adams and Carlsbad resident Jeffrey P. Matthews as engagement co-managers. As an indication of our commitment to serving the City, we plan on having Robert Perez, an accountant in our Orange County office, serve as in-charge accountant on our engagement with the City. Bob, who has significant hands-on government experience, has served on our engagement with the County of Orange for three fiscal years. In addition, Mike Bresnan, a manager in our Orange County office who serves as manager on our audits of the City of Orange, the City of Irvine and the County of Orange will serve as consulting manager. Mike has also served as supervising manager on our audits of the City of Vernon, the County of San Bernadino and the County of Riverside, and will be serving as co-manager on our engagements with the County of San Diego and the City of Chula Vista. In addition to Mike, the advisory group working with Bill, Debbie, Jeff, and Bob will include Frank Panarisi, who joined our firm last year after 27 years of public sector administration experience with the Counties of San Diego and Los Angeles; James L. Williams, our firm's National Industry Director for Government Services; and James H. Hugar, the partner in our Los Angeles office who serves as supervising partner on our County of Los Angeles and City of Vernon engagements. (Our work with the City of Vernon has made us familiar with the George Thomas software which was recently purchased by the City of Carlsbad.) This group's experience with governmental clients -- and particularly Southern California governmental clients -- should prove invaluable to the engagement team and to the City. -. 0.- F -5- c SUMMARY To summarize, we believe we are the firm best qualified to serve the City because we offer: A constructive service approach enabling us to perform the full scope of audit and consulting services required in an efficient, timely manner. P- Extensive governmental experience, especially in Southern California. The resources and capabilities of the largest An engagement team composed of experienced, accounting and consulting firm in San Diego. locally-based professionals with governmental and fund accounting backgrounds A genuine desire to serve the City of Carlsbad. We trust the following proposal provides all the information necessary to verify our belief and convince the selection committee that DH&S is indeed the City's best choice. c c -6- f c 11. PROFILE OF OUR SAN DIEGO OFFICE F / FF E c OUR PERSONNEL Deloitte Haskins & Sells, the largest public accounting firm in San Diego, has the capability to offer a complete range of services through four full-service departments: audit, tax, management . advisory services (MAS), and small business services (SBS). The statistics below indicate the strength of each department. Number of Personnel by Department MAS SBS Total - - Tax - Audit Partners 6 4 1 11 Managers and Supervisors 10 5 5 2 22 69 Professional Staff 102 22 Totals Ai2 ;LL u u Administrative and Support - - 10 - 5 - 22 7 32 - Total 124 - OUR CLIENTELE One of the best indicators of our office's quality and reputation is our client roster. Listed below are some of the many San Diego organizations we now serve: Governmental County of San Diego City of Chula Vista San Diego Transit Corporation Ramona Municipal Water District San Diego County Department of Education San Diego Community College District Ramona Unified School District Hiqh Technology Cipher Data Products, Inc. ISSCO (Integrated Software Systems Corporation) Monitor Labs, Inc. The Signal Companies, Inc. Wavetek Corporation -7- -4 Health Care c c c The Salk Institute for Biological Studies Scripps Clinic and Research Foundation Cecil H. and Ida M. Green Hospital of Scripps Clinic Children's Hospital & Health Center UCSD Medical Center La Jolla Cancer Research Foundation Hospital Council of San Diego and Imperial Counties Hemet Valley Hospital District San Diego Blood Bank Financial Institutions Southwest Bancorp La Jolla Bancorp Bank of Commerce Peninsula Bank United First Mortgage Corporation First Affiliated Securities John Burnham & Company Service San Diego Gas & Electric Company Four Winds Enterprises Cox Broadcasting Corporation Washington Patrol Service Construction Southwest Marine, Inc. Dunphy Construction Company University Mechanical & Engineering Contractors, Inc. Trepte Construction Company C. E. Wylie Construction Company John R. Selby Construction Company Retail/Wholesale Frazee Industries Big Bear Super Markets San Diego Office Supply Long's Drug Stores ESD Company Real Estate Burnham American Properties University Financial Warren Properties Village Venture -8- c Other Organizations 1 c c r r c c r- San Diego Symphony San Diego Urban League Economic Development Corporation Creditors' Committee of Nucorp Energy, Inc. Regents of the University of California - San Diego Junior Achievement of San Diego San Diego Wholesale Credit Association OUR SERVICE APPROACH Overall, our positive approach to client service centers on constructive service rendered on a timely basis. The efficiency we have developed in our work and our commitment to providing consistent engagement teams allow us to provide each of our clients with experienced, timely and personalized service from knowledgeable professionals familiar with their organization. Some time ago we adopted a plan to utilize our staff more effectively and limit overtime, consequently reducing turnover substantially. As a result, we have been able to maintain consistent audit teams on engagements from year to year, particularly at the senior and manager levels. We believe no other firm in San Diego can demonstrate such consistency. Our organization is structured around decentralized responsibility and authority with centralized support and review. Each local partner in charge of a client engagement is responsible for all of our services to that client. He or she determines the scope of work to be performed for the client, is responsible for all technical decisions, and coordinates the work of all personnel participating in the engagement. OUR NATIONAL AND INTERNATIONAL ORGANIZATION The San Diego office of DH&S is part of an international organization of over 26,000 people, with 400 offices in 71 countries. Here in the U.S., we have over 100 offices, nine of which are in California. We serve clients of all sizes in every segment of the economy; a sample of our better-known clients includes the City of New York, the County of Los Angeles, General Motors, Merrill Lynch, Monsanto, Honeywell, and The New York Times Company. The personnel in our practice offices are supported by the total nationwide resources of our firm. These resources include the Technical Research Department of our Executive Office in New York City, our National Affairs Office in Washington, D.C., and our designated industry specialists in virtually all segments of the t -9- economy. Our Technical Research Department is staffed by more than 60 partners and managers specializing in the technical accounting and financial aspects of virtually all major regulatory and professional organizations, such as the Office of Management and Budget, the General Accounting Office, and numerous state, regional, and local regulatory and industry organizations. The resources and expertise available in such an organization add a powerful dimension to our local service capability. STABILITY The stability of our practice can best be demonstrated by our consistent growth since our founding in 1895 -- growth that has occurred because of the high quality of services we provide our clients. Stability requires financial strength. Over the years, our firm has maintained a level of profitability sufficient to allow us to pursue our primary goals: developing increasingly better approaches to rendering client service; attracting and retaining superior professional talent; financing our growth; and meeting our commitments to our profession and the communities in which we practice. Here in san Diego, our position as San Diego's largest accounting and consulting firm is indicative of the health of our practice. r r - 10 - 111. GOVERNMENT EXPERIENCE AND QUALIFICATIONS c I- ,,*. ,- c GOVERNMENT EXPERIENCE AND OUALIFICATIONS~ Throughout California and the U.S., DH&S has maintained a strong presence in all facets of government service. Locally, as noted in our 'Executive Summary", we serve San Diego Transit Corporation, Ramona Municipal Water District, Ramona Unified School District, the San Diego County Department of Education and San Diego Community College District. We have also, within the past year, been engaged to audit the County of San Diego and the City of Chula Vista. In the recent past we audited six public works grants for the City of San Diego and 29 CETA grants administered by Imperial County. On the following pages, we discuss our state, national and local experience in a variety of areas relevant to the City of Carlsbad engagement. LOCAL GOVERNMENTS We serve nearly 400 governmental clients nationwide, performing annual audits of over 300 state and local governmental units. Among the local governments our nine California offices serve are: CITIES Brentwood Chula Vista Irvine Orange Palo Alto Riverside Vernon COUNTIES Los Angeles Monte r ey Napa Orange Riverside San Bernardino San Diego San Joaquin As you can see, our clients include several significant Southern California local governments. Outside California we now serve or have served the following in the past five years: CITIES COUNT1 ES Charlotte, North Carolina Albany, New York (City and Cleveland, Ohio County) Dallas, Texas Bucks County, Pennsylvania Dayton, Ohio County of Suffolk, New York (Long Island) - 11 - CITIES El Paso, Texas Houston, Texas Jersey City, New Jersey Milwaukee, Wisconsin Mobile, Alabama New York City, New York San Antonio, Texas Springfield, Illinois COUNT I E S Harris County, Texas Honolulu, Hawaii (City and Hudson County, New Jersey Lake County, Oregon Metropolitan Dade County (Miami) Florida Metropolitan Government of Nashville and Davidson County, Tennessee Montgomery County, Maryland County) The breadth of service we offer is illustrated by our engagements with New York City and the City of Cleveland. . New York City. We are currently serving as auditors for the City. Previously, we provided special consulting assistance to the State of New York in its supervision of the accounting, reporting, and financial management changes required of New York City under 1975 state and Federal legislation. We delineated the generally accepted accounting principles to be established and followed by the City; supervised a special task force in developing the general audit scope for the audit of the City of New York for the 1978 fiscal year, which was the first audit of the City conducted by independent accountants; and assisted City and state officials in preparing their request for proposal for audit services. . City of Cleveland. Our firm was selected in early 1980 by the Financial Planning and Supervision Committee of the City of Cleveland to serve as the City's Financial Supervisor. In this role, we act as staff to the Committee, provide research and a variety of financial and management-related consulting services, and monitor the City's progress toward achieving fiscal integrity. Our services to the Committee have included the following: Conducted a constructive review of the City's Financial Plan for 1980-82 to ensure compliance with applicable statutes and to assess its adequacy and probable effectiveness in preparing a balanced budget, paying delinquent debts, restoring construction and bond funds used for other purposes, and eliminating all fiscal emergency conditions. c - 12 - c c Reviewed the City's progress toward implementing an automated management system, including such aspects as technical requirements and capabilities, management reports, and enterprise fund requirements. We also conducted extensive tests to ensure that the system properly recorded transactions and that its fund structure conformed to generally accepted accounting principles. Assisted in developing a six-year budget for capital expenditures. Analyzed the City's cash projections for all funds for a three year period. Reviewed tax budgets, tax levy ordinances, bond and note ordinances and appropriation measures to determine their consistency with and effect on the Financial Plan. assist the City in obtaining long-term financing. Consulted with Lazard, Freres & Co. on their efforts to Assisted the City in assessing and correcting significant weaknesses in its financial management procedures. STATE, COUNTY AND LOCAL AGENCIES We provide accounting, auditing, and consulting services to over 125 state government departments and agencies. For some, we are helping to ensure their compliance with various federal programs, such as revenue sharing, grants, and contracts. For others, we are developing accounting and control systems for such diverse needs as health cost containment and state lottery operations. For still others, we are the auditors and consultants for their public welfare and health delivery agencies. A brief listing of some of our clients in this area includes: California State Department of Finance California State Department of Transportation Golden Gate Bridge, Highway and Transportation District Los Angeles County Transportation Commission South Coast Area Transit Regents of the University of California Michigan State Lottery Ohio Department of Public Welfare Missouri Department of Social Services - 13 - Commonwealth of Pennsylvania Department of Labor and Industry Arizona Energy Office Colorado Department of Social Services Georgia State Department of Medical Assistance The range and diversity of these clients is indicative of our commit- ment to and expertise in serving governmental agencies. PROGRAMS FINANCED BY THE FEDERAL GOVERNMENT On a firmwide basis, we have substantial experience with a variety of federal grant programs. These have included programs funded through the Departments of Housing and Urban Development, Health and Human Services, Commerce, Labor, Treasury and Transportation, as well as the Office of Economic Opportunity and the U.S. Civil Service Commission. We have performed numerous audits of individual federal grants, both as an extension of our annual independent audit of the grantee and on a special engagement basis. We have particularly strong experience with the following federal programs: Federal Revenue Sharing Community Development Block Grants Economic Opportunity Grants Model Cities Grants Economic Development Council Grants Urban Renewal Grants Comprehensive Planning and Assistance Grants Housing and Urban Development Grants Urban Mass Transit Grants Federal Aviation Agency Grants Head Start Follow-Through Grants Comprehensive Employment and Training Act Grants As we discussed earlier, our San Diego office has had direct experience with audits of Imperial County's CETA Program and the City of San Diego's public works grants. With respect to federal grants, we have advised a large number of our governmental and not-for-profit clients as to proper grant management techniques, and have developed comprehensive financial management and control systems for grant-related activities. Among our special services to government clients is the firm's Federal Government Grants Information Service, designed for local governmental units, nonprofit organizations, and other groups eligible to receive federal and private foundation grant funds. At no cost to its clients, DH&S grants specialists will research available federal and foundation funding programs, provide assistance in reviewing their current grant status, address areas of local interest and need, ascertain eligibility requirements, and assist in determining which grant programs to pursue. DH&S can also provide assistance in preparing and submitting grant application packages and complete grant management services. - 14 - MUNICIPAL SECURITIES OFFERINGS "- IC DH&S has extensive experience in assisting governmental clients with public bond offerings. Several members of the engagement team selected to serve the City have firsthand experience with the procedures and disclosure requirements of municipal bond offerings including the guidelines set forth in the MFOA publication Disclosure Guidelines for Offerings of Securities by State and Local Governments as revised in June 1979. Our personnel are kept informed through our Government Industry Group on the status of proposed legislation being considered by the Senate and the House of Representatives as well as proposals being considered by the Securities and Exchange Commission that may impact municipal securities offerings. EDUCATIONAL PROGRAMS Our firm has an extensive and comprehensive continuing education program covering a wide range of industry and technical areas. Courses related to municipal accounting and auditing include such courses as the following: . Introduction to Accounting and Auditing -- Public Utility Industry . Audits of School Districts . Basic Concepts of Local Governmental Budgeting . Basic Concepts of Local Governmental Accounting . Basic Concepts of Local Governmental Financial Reporting In addition to participating in these firm-sponsored seminar and self-study courses, our professionals regularly attend seminars and conferences on municipal accounting and auditing issues sponsored by the American Institute of CPAs, the California Society of CPAs and the Municipal Finance Officers Association, among other professional organizations. GOVERNMENT RESOURCES Recognizing the expertise required to meet the special needs of governmental units, DH&S has established a Government Services Group within the firm. The Group, organized on a national basis, is composed of over 500 specialists with exceptional qualifications in the field of governmental accounting. These specialists work with our local team, bringing the firm's accumulated expertise to our engagements. - 15 - c c Our Government Services Group carries out a number of programs to support our practice offices and better serve our clients. resources include a Washington, D.C. governmental service team which monitors legislative and regulatory developments affecting state and local government and disseminates information of such developments to specialists throughout our firm. Our government specialists also conduct seminars for various govern- mental groups on such subjects as accounting principles, auditing standards, regulatory reporting, cash management and computer applications. audit programs for examining different types of state and local entities, and assist offices in tailoring these programs to specific entities. programs to keep our staff technically proficient and aware of the many special requirements of government accounting, auditing and reporting. As we mentioned in our "Executive Summary", we also have a unique resource here in San Diego: Frank Panarisi, formerly assistant chief administrative officer for the County of San Diego. With his years of administration experience, Frank is a valuable resource for our clients as well as our own personnel. In addition, Joan Martin, formerly a director of SANDAG, recently joined our firm, further increasing our strength in the area of government consulting. The major These specialists also develop and maintain special Our governmental specialists also conduct training PROFESSIONAL RECOGNITION In addition to representation in the Municipal Finance Officers Association--including membership on the Certificate of Conformance Review Committee--members of our firm have served on all of the major governmental committees of the American Institute of CPAs and the National Committee on Governmental Accounting. One of our partners served as chairman of the AICPA committee that wrote Audits of State and Local Government Units, and another was a member of the task force that revised that audit guide. The chairman of our firm, Charles G. Steele, currently serves as vice president of the Financial Accounting Foundation (FAF) and chairman of its special committee on the Governmental Accounting Standards Board (GASB). The FAF recently approved the establishment of the GASB, which will consolidate the rules of all government accounting organizations into one body. In addition, we have been selected to serve the Department of Treasury, Office of Revenue Sharing. Our primary services to ORS include reviewing financial reports submitted by revenue sharing recipients for compliance with revenue sharing requirements (e.g.8 independent audits and conformance with generally accepted accounting principles) and preparing reports on our findings. In 1977, the Municipal Finance Officers Association (MFOA) published ing Effective Cash Management in Local mt in Local Government: A Comprehensive Approach - written by our - 16 - Government Services Group. The handbooks resulted from a special engagement by the MFOA to develop a program to assist cash managers in local government in implementing more effective cash management programs. P c - 17 - IV . ENGAGENENT ORGAN1 ZATION AND PERSONNEL ENGAGEMENT ORGANIZATION AND PERSONNEL As we have emphasized throughout our proposal, we have assembled an engagement team which we believe offers a unique mixture of experi- ence, talent and skill to the City. The team combines members of our San Diego office with Orange County and Los Angeles personnel responsible for our government audits for the Cities of Orange and Irvine and the Counties of Orange and Los Angeles. We have also added, in an advisory role, our firm's National Industry Director for Government Services. Regarding the structure of the team, our system of quality control ensures that the partner and manager on each engagement are directly involved with and have personnel responsibility for all work performed during an engagement. An audit "in-charge" -- in this case, Bob Perez -- supervises the day-to-day work of the audit staff. The manager is responsible for overall planning and review. The engagement partner and consulting partners not directly involved with the engagement review all reports before they are issued. On the following pages we present the resumes of the key members of our engagement team. - 18 - WILLIAM F, WAINA, JR.1 CPA Audit Partner San Diego Office ROLE IN ENGAGEMENT: Engagement Partner EXPERIENCE: Twenty-five years of public accounting experience with Deloitte Haskins & Sells EXAMPLES OF CLIENTS SERVED: County of San Diego City of Chula Vista Imperial County (CETA Grants) City of San Diego (Public Works Grants) Ramona Municipal Water District San Diego County Community College District San Diego County Department of Education Ramona Unified School District Scripps Clinic & Research Foundation Logan Heights Family Health Center, Inc. Goodwill Industries University Industries SPECIAL EXPERTISE: Extensive involvement in not-for-profit accounting and accounting for government contracts PROFESSIONAL ACTIVITIES: American Institute of Certified Public Accountants California Society of Certified Public Accountants Corporate Finance Council EDUCATIONAL BACKGROUND: University of California, Los Angeles Bachelor of Science Degree - 19 - DEBRA J. ADAMS, CPA ROLE IN ENGAGEMENT: EXPERIENCE: EXAMPLES OF CLIENTS SERVED: SPECIAL EXPERTISE: PROFESSIONAL ACTIVITIES: EDUCATIONAL BACKGROUND: Audit Supervisor San Diego Office Engagement Co-Manager Five years of public accounting experience with Deloitte Haskins & Sells County of San Diego City of Chula Vista Ramona Municipal Water District Regents of UCSD La Jolla Cancer Research Foundation The Salk Institute for Biological Studies San Diego Blood Bank Equitable Life Leasing Corporation John Burnham & Company Extensive experience with fund and grant accounting, and with special reports to governmental agencies American Institute of Certified Public Accountants Illinois CPA Society Eastern Illinois University Master of Business Administration Degree Bachelor of Science Degree t c - 20 - c JEFFREY P. MATTHEWS, CPA L c Audit Supervisor San Diego Office ROLE IN ENGAGEMENT: Engagement Co-Manager EXPERIENCE: Six years of public accounting experience with Deloitte Haskins 6 Sells EXAMPLES OF CLIENTS SERVED: County of Santa Ana-HUD Redevelopment Agency County of San Bernadino San Diego Museum of Art Southwest Bancorp Wavetek Corporation Energy Factors, Inc. Trepte Construction Company SPECIAL EXPERTISE: Significant experience with fund accounting PROFESSIONAL ACTIVITIES: Carlsbad Rotary American Institute of Certified Public Accountants California Society of Certified Public Accountants EDUCATIONAL BACKGROUND: University of Southern California Master of Business Administration Degree San Diego State University Bachelor of Science Degree - 21 - ROBERT PEREZ c c ROLE IN ENGAGEMENT: EXPERIENCE: EXAMPLES OF CLIENTS SERVED : SPECIAL EXPERTISE: EDUCATIONAL BACKGROUND: Audit Staff Orange County Office In-Charge Accountant Over two years of public accounting experience with Deloitte Haskins & Sells County of Orange California State University - Los Angeles Hunt Wesson Foods Nichols Institute United Way Served on County of Orange audit for fiscal years 1982 and 1983; currently serving on 1984 audit. University of Southern California Bachelor of Science Degree c c c - 22 - FRANK PANARISI Regional Government Services Coordinator San Diego Office ROLE IN ENGAGEMENT: EXPERIENCE: EXAMPLES OF CLIENTS SERVED: SPECIAL EXPERTISE: PROFESSIONAL ACTIVITIES: EDUCATIONAL BACKGROUND: Advisory Manager Prior to joining DH&S in March 1983, served as Assistant Chief Administrative Officer for the County of San Diego. Served for 12 years with the County of San Diego and 15 years with the County of Los Angeles in a variety of administrative roles having direct involvement in all aspects of County operations. Serves as consultant on all Western Region government clients, including: City of San Diego City of Chula Vista City of Henderson (Nevada) County of Los Angeles County of San Diego County of Orange San Diego Association of Governments (SANDAG) San Diego Community College District Governmental operations and management California Municipal Treasurers Association Municipal Finance Officers Association San Diego Chamber of Commerce - Member, Government San Diego Rotary United Way - Board of Directors Big Brothers of San Diego - President Advisory Council Occidental College Bachelor of Arts Degree - 23 - JAMES H. HUGAR, CPA Audit Partner Los Angeles Office r ROLE IN ENGAGEMENT: EXPERIENCE: EXAMPLES OF CLIENTS SERVED : SPECIAL EXPERTISE: PROFESSIONAL ACTIVITIES: EDUCATIONAL BACKGROUND: Consulting Partner Twelve years of public accounting experience with Deloitte Haskins & Sells County of Los Angeles City of Vernon City of Los Angeles - Department of Airports LOS Angeles County Health Facilities Los Angeles County Transportation Commission Municipal accounting American Institute of Certified Public Accountants California Society of Certified Public Accountants Municipal Finance Officers Association Los Angeles Municipal Auditors and Accountants Association - Member, Board of Advisors Los Angeles City Council Blue Ribbon Pension Review Committee Los Angeles Chamber of Commerce - Member, State and Local Government Committee University of California, Los Angeles Master of Business Administration Degree Pennsylvania State University Bachelor of Science Degree r L - 24 - JAMES L. WILLIAMS, CPA Audit Partner National Industry Director - Government Services Houston Office - ROLE IN ENGAGEMENT: Advisory Partner - Special Industry Consultant EXPERIENCE: Twenty years of public accounting experience with Deloitte Haskins h Sells EXAMPLES OF CLIENTS - SERVED: County of Los Angeles County of San Bernadino County of Riverside Harris County, Texas City of Houston, Texas Fort Bend County, Texas Public Utilities Board of Brownsville, Texas r SPECIAL EXPERTISE: - Serves as DHhS National Industry Director for Government Services; as such, consults with all offices on technical problems in governmental auditing and reporting. Substantial experience with municipal bond offerings. PROFESSIONAL ACTIVITIES: American Institute of Certified Public Accountants Texas Society of Certified Public Accountants National Council on Governmental Accounting Municipal Finance Officers Association MFOA Certificate of Conformance Special Review Committee EDUCATIONAL BACKGROUND: Rice University Bachelor of Arts Degree - 25 - MICHAEL F. BRESNAN, CPA Audit Manager Orange County Office r r r ROLE IN ENGAGEMENT : Consulting Manager EXPERIENCE: Eleven years of public accounting experience with Deloitte Haskins & Sells EXAMPLES OF CLIENTS SERVED : County of Orange County of San Bernadino County of Riverside City of Orange City of Irvine City of Vernon City of Santa Ana Redevelopment Agency Riverside Transit Agency SPECIAL EXPERTISE: Governmental audits; extensive experience with single audits PROFESSIONAL ACTIVITIES: American Institute of Certified Public Accountants California Society of Certified Public Accountants Municipal Finance Officers Association MFOA Certificate of Conformance Special Review California Society of Municipal Finance Officers C omm i t t e e EDUCATIONAL BACKGROUND: University of Illinois Bachelor of Science Degree r L - 26 - MARK E. DELANE MAS Manager San Diego Office e- - ROLE IN ENGAGEMENT: EXPERIENCE: EXAMPLES OF CLIENTS SERVED: SPECIAL EXPERTISE: PROFESS1 ONAL ACTIVITIES: EDUCATIONAL BACKGROUND: Manager - EDP Auditing Nine years of diversified data processing experience in both the public and private sectors. Manager-in-charge of the San Diego office Management Advisory Services Department City of San Diego San Diego Community College District San Diego Department of Education Frazee Industries M. H. Golden Company Summa Corporation Extensive experience in systems evaluation and design in the government, health care, financial, hospitality and distribution areas. Data processing specialist Association for Systems Management Hospital Financial Management Association University of Southern California Master of Business Administration Degree University of California, Los Angeles Bachelor of Arts Degree - 21 - -. r- . V. WORK PLAN -. WORK PLAN We take particular pride in our ability to meet cost, schedule, and technical bid requirements. In carrying out numerous engagements of varying sizes and degrees of complexity for all levels of government, as well as for our clients in the private sector, we have estabished a record of such performance without sacrificing quality. The time required to conduct an audit and the related cost are often difficult to estimate because of the uncertainties involved with respect to problems that may be encountered, the condition of the accounting records, etc. When submitting a proposal such as this one, we make every effort to thoroughly understand the requirements and conditions of the engagement. We estimate the time requirements carefully and we determine that the personnel to be assigned to the engagement have adequate time avilable to do the work on a timely basis. Because of our recent experience in auditing governmental financial statements, we are particularly confident in our understanding of the engagement comprehended by this proposal. We have developed an engagement plan for serving the City which is comprehensive in scope, scheduled to meet your needs, and which will be implemented economically and efficiently. This plan is based on our knowledge of California governmental units' systems and proce- dures, which we have obtained during our examinations of the Cities of Irvine, Orange, and Vernon and of the Counties of Orange, Los Angeles, San Bernardino, and Riverside. It incorporates programs and techniques that were developed and used successfully on these examinations. OBJECTIVE AND SCOPE We will examine the general purpose financial statements of the City for the period beginning July 1983 and ending June 30, 1984, and will issue an opinion letter on the City's financial statements and compliance with applicable legal provisions. The audit will be performed in accordance with generally accepted auditing standards and applicable NCGA statements and cover all funds of the City, including a variety of all fund types. Our examination will enable us to report on such financial statements and will enable us to state whether the combining, individual fund, and account group financial statements and supporting schedules are stated fairly in all material respects in relation to the general purpose financial statements taken as a whole. We will also perform all procedures necessary to enable us to issue a compliance report for Revenue Sharing, and assist in the preparation of the supplementary schedules contained in the City's annual financial report. - 28 - c c In addition, we will render separate opinions and statements of compliance on the following entities: 1. 2.. Federal Revenue Sharing 3. Water Enterprise Fund The Redevelopment Agency of the City of Carlsbad We will also, by October 5, issue management letters to the City setting forth our comments with respect to the system of internal accounting controls, administration and operating matters, accoun- ting policies and procedures, EDP operations, and your financial accounting and reporting system. We understand that your areas of particular interest include internal finance department organization, purchasing systems, accounts payable systems, payroll systems and cash management functions. Our broad objective is to translate the results of our audit into recommendations that will have maximum benefit to your City in its overall management practices. AUDIT PLAN We plan to perform our procedures in two phases: Phase I - Preliminary review and Phase I1 - Fiscal year-end work. Phase I - Preliminary review Phase I can begin up to three months prior to year-end and will include the following procedures: Meet with City personnel to review accounting, reporting, budgeting, planning, and other areas Review your current auditors' work papers Document our evaluation of the City's system of internal control over grant expenditures and related grant compliance requirements Prepare drafts of your proposed comprehensive annual financial reports and review those drafts wth City personnel Perform tests of transactions through an interim date. During this phase, we will complete our evaluation of the internal accounting control system in order to determine the appropriate extent to which our audit procedures should be applied. Based on the conclusions reached as to the effectiveness of the City's internal accounting controls, we will determine the timing and extent of the specific audit procedures to be performed, including the exact use to be made of statistical sampling methods and computer audit programs. A brief description of our advanced auditing techniques is included in this Section. - 29 - Phase I1 - Fiscal vear-end work The final phase of our audit work, which will commence during August, will involve updating and completing our examination of the financial statements and the grant activity and the completion and rendition of our reports. Based on our understanding of the City, we foresee no problem in being able to provide you with a final draft of our audit report by September 28, with the final report, financial statements and supplemental schedules rendered by October 5. We will hold an exit conference with the City staff within 10 working days of the submission of the final report documents. As a result of the interim work performed during Phase I, the majority of the accounting and reporting matters will have been identified and resolved. Thus, the completion of the audit will be efficient. The following procedures will be performed as soon after the closing of the books as is practicable: Perform analyses and tests of balance sheet accounts Perform analytic review tests Perform tests of transactions for the remaining part of the year Perform such other auditing procedures as will be required to issue our opinion on the financial statements and notes Review our comments and conclusions regarding internal accounting controls with City personnel. AUDIT WORK PROGRAM The following audit work program describes the procedures we plan to follow during the examination of the City's financial statements. This program has been developed from our experience in auditing other governmental entities and, as such, is directed specifically toward California cities. Planninq and Control Planning We will plan the audit \ tilize o r familiarity with and understanding of California governments so as to ensure optimum effectiveness while maintaining an optimum level of efficiency. Supervision and Review c - 30 - c All field work will be directly supervised by individuals who have had prior governmental audit experience. Work will be directed by Debbie Adams and Jeff Matthews, with the close consultation of Mike Bresnan. All audit work on the engagement will be supervised by Bill Waina, the partner responsible for the engagement. He will be provided technical assistance and support by Jay Hugar, the partner responsible for our audit of the County of Los Angeles. . Audit Programs Our audit programs will be designed based on the audit programs we have developed during our other Southern California governmental audits. Each significant account or function will be covered by these programs. Internal Accounting Control Evaluation The second standard of field work under generally accepted auditing standards states: "There is to be a proper study and evaluation of the existing internal control as a basis for reliance thereon and for the determination of the resultant extent of tests to which auditing procedures are to be restricted." We will use the questionnaire developed in our prior examinations of California counties and cities to assist in documenting Our evaluation of the City's internal accounting control. In addition to these questionnaires, which survey internal accounting controls in various departments, we plan to document general procedures utilized by the City for collections, payroll, purchase orders, summarizing of transactions, etc. In addition to the review of internal accounting controls, we will perform a special review of the controls over the City's data processing system. This review will be performed by individuals who devote the majority of their time to performing reviews in accordance with Statement on Auditing Standards Number 3. This work will be supervised by Mark Delane, a San Diego-based management advisory services manager, whose resume is included in Section IV of our proposal. Tests of Asset and Liability Accounts Set forth below are some of the specific methods we expect to use to test certain of the asset and liability accounts. The primary objectives of such tests are to determine that each asset and liability is recorded properly, appropriately classified, and stated at a reasonable amount. . Cash - 31 - .. Count cash on hand at year-end to determine that such cash is properly recorded in the accounts .. Secure direct written confirmation of all balances from depositories #- .. On a test basis, examine the records of pledged .. On a test basis check calculations of interest collateral and test pooled collateral operations earned on interest-bearing amounts .. On a test basis determine that cash receipts are deposited intact on a daily basis. . Investments and Related Income .. Determine that investments are authorized and comply with applicable legal provisions c .. Determine that investments are properly recorded .. Determine that the income on investments has been properly computed, accounted for and allocated to appropriate funds .. Determine that investments owned by the funds at any time during the period under audit but which have been redeemed have been properly accounted for. Receivables .. On a test basis examine the original documents supporting the accounts and determine authority therefore .. On a test basis confirm balances due by direct correspondence with the debtor .. Determine that reasonable allowance was made for uncollectible items. Fixed Assets (including leased items) .. Determine and evaluate methods employed in valuation of fixed assets for accounting purposes .. Determine that accounting records properly reflect the annual inventory of fixed assets .. Examine vouchers, construction contracts, leases and other documents reflecting additions to fixed assets - 32 - .. .. .. during the period on a test basis to determine whether such additions are properly recorded in the accounts and property records Determine that the disposals of fixed assets were authorized and properly recorded in the accounting records. Trace cash collections from such disposals into the record of cash receipts. Determine that repairs and replacements are supported by the necessary authorized vouchers and are charged to the proper accounts Test the computation of depreciation expense for the current year and of accumulated depreciation for the enterprise funds. Other Assets .. Test balances to determine their reasonableness in view of the nature of each account. Accounts Payable .. Test to determine that all significant accounts payable are recorded as liabilities .. Determine by appropriate tests that obligations incurred during the period under audit are properly recorded in the accounts and that they are recorded in the proper accounting period. Other Liabilities .. Determine that liabilities for expenses incurred and expenditures made but unpaid at the end of the period under audit are properly recorded. .. Examine documents supporting reserves for uncompleted purchase orders and encumbrances to determine that such reserves are adequate and properly recorded. Deferred Revenues .. Determine that any amounts collected for a future year are excluded from revenue of the year under audit and are recorded as deferred credits. Self-Insurance Liabilities .. Review the City's self-insured medical and workers' compensation plans - 33 - c .. Obtain from the consulting actuary an evaluation of asserted and unasserted claims pending under such plans .. Determine that the liability for such plans has been properly recorded. . Pension Liabilities .. Review appropriate instruments governing the City's pension plan and the latest report from the state of California covering such plan r .. Determine that the proper amounts have either been paid or recorded as liabilities for the City's pension contribution for the current year .. Determine that proper disclosure is made in the financial statements. . Long-Term Debt and Capital Lease Obligations .. .. .. .. .. Compare balances payable with legal authorization and bond records Determine that bonds retired during the period under audit are properly recorded Examine bond indentures to determine compliance with debt service and other requirements Review the documents authorizing leases Determine that the City's liability under leases is properly recorded. . Equity Accounts .. Determine that fund balances, retained earnings and contributed capital are separately stated and that changes in these accounts are properly disclosed in the financial statements. Tests of Revenues and Expenditures We will test each significant type of revenue and expenditure of the City to determine that it is: Recorded properly Properly classified as to source Stated at a reasonable amount. In addition, we will examine the annual budget approved by the City Council and compare budgeted amounts to recorded revenues and expenditures. - 34 - Revenues Revenues will be tested in one of three ways: . Confirmation and/or Other Supporting Documentation Numeric Sampling of Internal Documents . Revenue Days Methods . Analytical Review We will use the appropriate method, or combination of methods, to test each of the significant sources of revenue of the City. Set forth below are some of the specific methods we expect to use to test certain of the revenue categories. . Sales taxes .. Confirm with state .. Analytic review of amounts received for reasonableness . Licenses and Permits .. Obtain a schedule of approved rates of all .. Test rates charged against ordinances or properly significant licenses and permits approved schedules .. Trace collections into the record of cash receipts. . Fines and Forfeitures .. Review the police department's traffic violation policies and procedures and test control of traffic tickets issued .. Review dockets or other original court records for fines and fees collected .. Test collections of fines, forfeitures and other court fees .. Trace collections into the cash receipts record. . Aid from Other Governmental Agencies .. Confirm directly with other governmental units the .. Trace receipts into the record of cash receipts amounts collected and paid to the City .. Determine that such amounts have been or are being used for authorized purposes. - 35 - . Charges for Current Services .. Review authorizations for services and rates .. Test amounts charged and billings made .. Trace collections into the City Treasurer's record of cash receipts . Sales of Fixed Assets .. Review authorizations for sales .. Examine fixed asset records to determine the asset has been properly removed .. Trace cash receipts into the record of cash receipts. Expenditures The methods we will use to test expenditures will vary depending upon the type of expenditures. Several examples of the types of expenditures and our audit approach related to each are discussed below. c . Payrolls and Related Costs We will select from recorded amounts and examine employee status and time records for propriety of distribution, approval and other indications of validity. We will also test the computation of gross and net pay and examine the related paid warrant for apparent propriety. . Purchases of Materials and Supplies We will select from recorded amounts and examine supporting documents for propriety of account distribution and for approval or other independent indications of validity. We will examine the related paid warrants for apparent propriety. General Procedures . Minutes: We will review the minutes of the meetings of the City Council for matters of audit significance. We will test accounting records for compliance with all significant matters and for proper authorization by the Council for all transactions for which such authorization is - 36 - c required. The period covered by such review will include the period covered by our audit as well as such preceding and succeeding periods as we consider necessary. . Statutory Review: We will review the ordinances of the City of Carlsbad, the County of San Diego, the statutes of the State of California and the laws of the United States of America to the extent we consider necessary to provide a basis for testing for compliance of financial transactions with such ordinances, statutes and laws. . Analytic Review: We will review the amounts shown in the financial statements of the various funds under audit for relative comparability with similar amounts shown in the financial statements for prior years and with applicable budgets. In making this review, due consideration will be given to events or circumstances which should have caused significant changes from prior years. . Adjusting Journal Entries: We will accumulate proposed adjustments, coordinate with the Finance Director as to any material adjustments, and evaluate the effects of accumulated immaterial adjustments on operations and financial position of the funds . . Subsequent Events: We will perform certain procedures to determine whether any events occuring subsequent to the balance sheet date would require adjustment of the financial statements or disclosure therein. Procedures will be performed through the date of our opinion and will include: . Reviewing available financial information for periods subsequent to year-end . Making inquiries of appropriate officials . Reviewing ordinances adopted and minutes of City . Reviewing the effects of any significant happenings Council meetings subsequent to the balance sheet date since the balance sheet date. . Reports: We will advise you of our suggestions concerning the preparation of your comprehensive annual financial - 37 - c report. As indicated previously, this task will be staited in the early stages of the engagement. Particular emphasis will be placed on: . Conformity with generally accepted accounting principles . Statement format and mode of presentation of financial data . Adequacy of disclosures . Presentation of budget amounts and comparisons . Financial accountability of officers and employees . Effects of current developments in accounting and financial reporting on the financial statements. . Comment Letter: As is our practice, we will issue reports containing our comments relating to internal accounting controls, accounting procedures and other matters noted in connection with each engagement for the examination of financial statements. Such reports will not be based on a detailed review of the City's system of internal accounting control, but rather to determine the nature, timing and extent of auditing procedures that are necessary for expressing an opinion on the financial statements. We will review drafts of these reports with City personnel prior to their issuance. ADVANCED AUDIT TECHNIQUES During the last decade, DHtS has invested heavily in the research and development of more efficient auditing methods. As a result of these efforts we have become recognized as the accounting profession's leader in the development of advanced auditing techniques and procedures. Some have been adopted by the profession; others are still unique to DH&S. Our experiences from succeeding other auditors on major engagements have repeatedly demonstrated that our advanced techniques provide us with a unique ability to perform highly efficient audits. Our techniques and procedures include: . Computer audit programs which speed selection and . A pinpoint approach to evaluation of internal accounting evaluation of sample items control c Advanced statistical techniques which incorporate predetermined reliability and precision levels - 38 - A constructive approach to auditing with emphasis on communication with appropriate levels of management. All of the above techniques and procedures are directed to optimizing audit efficiency while maintaining the highest quality standards. We are continually refining and advancing our technology in response to the increasing complexity of our clients' information systems, specific client needs, and the cost of performing audits. These techniques and procedures will be used in our examination of your financial statements. On the following pages we describe these techniques, all of which comprise AuditSCOPE, our unified, comprehensive audit system. AuditSCOPE as applicable to government entities encompasses the following specific techniques: . Municipal Audit Programs . Audit Sampling Plan AUDITAPE Statistical Techniques for Analytic Review (STAR) . Computer Support . Mini-Max . Evaluating internal controls - ControlSET c . Other Quality Control Procedures Municipal Audit Programs In making our examinations of municipalities, we use auditing techniques designed to achieve audit economy and efficiency while maintaining strict quality controls. Municipal Audit Programs, representing a unified approach to auditing government entities, are designed to meet the specialized needs of our municipal clients. The programs specify the audit procedures and detailed tests we need to make, and specifically correlate our internal control evaluation with our audit tests. Audit Samplinq Plan ,- Our Audit Sampling Plan is a method of obtaining efficient, mathematically valid samples from accounting records in order to reduce the amount of time required for detail testing. We use the plan extensively throughout our practice -- as a supplement to, and not a replacement for, sound professional judgment. - 39 - c c The Audit Sampling Plan is based on predetermined reliability and precision levels. The sample size is directly related to both the materiality of individual items and the effectiveness of the internal control systems. In applying our Audit Sampling Plan to a municipality's accounting records, we first consider the detailed evaluation of internal accounting controls to determine the extent of testing required. Documents and related records supporting the individual items selected by sampling are examined using traditional auditing methods. Monetary and procedural deficiencies are then statistically computed and evaluated. This approach allows the auditors to determine the appropriate testing required for each area; to select a small, statistically valid sample from the accounting records; and to evaluate the results quantitatively. AUDITAPE DH&S was the first accounting firm to develop generalized computer programs for auditing through a computer. This innovative and unique group of computer programs is known as the AUDITAPE System. The AUDITAPE System incorporates our statistical sampling plan and, when applied to a set of computer records, will automatically select records to be tested. In addition, AUDITAPE develops independent counts and dollar totals from computer files which can be compared to control totals. This procedure eliminates the old-fashioned procedure of adding columns of numbers in computer printouts and permits our professional personnel to pursue more constructive audit tasks. AUDITAPE provides us with an efficient means of using a computer to perform audit functions. While our approach and considerations are conceptually the same whether the audit is performed manually or through the use of AUDITAPE, the use of computer audit software becomes a practical necessity when we undertake an audit of accounts maintained on a data processing system, as will be the case with the City. The AUDITAPE System has been designed to be used on our clients' computer systems and can be used on the City's system. To the extent time is available, at whatever hour, we are prepared to apply AUDITAPE to your computer system. We are continually improving this system to maintain pace with improvements in data processing technology, enabling our people to reduce the time otherwise required for audit testing. They can then devote their efforts to applying a clear, creative, and constructive approach in auditing. - 40 - Statistical Techniques for Analytic Review (STAR) In addition to testing supporting documents and details of the accounting records, our auditors also perform an overall evaluation of account balances and their interrelation with each other. This analytic review is designed to identify fluctuations in financial statement accounts that appear to be unusual in relation to expected results, past performance, "normal" relationships and other factors. We have developed an advanced technique for performing analytic review that includes the use of multiple-regression analysis. This mathematical technique statistically determines the historical relationships among the financial data in periodic financial statements and the relationship between financial statement data and non-accounting variables. Any results that fall outside of the specified statistical parameters are isolated for further testing and evaluation. Computerized regression-analysis programs permit the auditors to specify the same statistical parameters used in audit sampling. This feature allows them to achieve the same degree of reliability in the overall review as in the detail testing. The advantages of this method of performing the analytic review function are that auditors are able to quantify the results of this test statistically and to achieve a proper combination of statistical auditing techniques and traditional accounting judgment . Computer Support We have developed computer timesharing programs that can be used in support of our audit examinations. These programs are ready to use and operate on the General Electric timesharing system with its multinational communications network, The programs include : FORECAST - A financial forecasting and reporting system. These programs are designed to assist decision makers and financial analysts with financial planning by allowing them to make "what if ...I assumptions regarding financial operations and receive immediate results. FORECAST was designed for use by management and allows financial management to develop and handle their own applications. INTEREST - A program for computing the time value of money. This program solves problems such as determining the effective interest rate on loan contracts, calculating the present value of future lease commitments and determining the effective rate of return on an investment. - 41 - c r LEASE - A program designed to handle the complex computations for operating and capital leases required by FASB Statement No. 13, "Accounting for Leases." The program also provides the required report disclosure information. PLUSPLAN - A financial modeling and consolidation system designed by DH&S to operate on an IBM or IBM-compatible personal computer. PlusPlan incorporates the most successful features of other computer systems developed by DH&S and adds the microcomputer's advantages of flexibility and cost-effectiveness. The financial information that can be generated includes projected financial statements; cash flow projections; budgets; inventory, production and other volume projections; variance analyses and custom reports; and consolidated financial statements. The user can base his projections on factors of his own choosing such as interest rates, price indices and growth trends. Built-in accounting controls, security features, and flexible reporting make this package unique from others on the market. Mini-Max A well-known management concept is that of "management by exception" in which attention is given only to events or results that vary from a predetermined norm. In auditing revenues of a governmental entity, detailed testing is not necessary if a particular revenue or account balance can be computed independently. The use of mini-max combines the management by exception theory with the independent calculation technique. Under mini-max, we would test only the variance from an independently computed amount. Evaluating Internal Controls - ControlSET The amount of audit testing that our accountants need to perform is directly affected by their evaluation of internal controls. Areas having good controls receive a minimum of testing, while any areas that have weak controls are tested more extensively. As a result of a major research study on the evaluation of internal controls, we have developed an advanced system, called ControlSET, for evaluating internal accounting controls. Our system (a significant improvement over traditional approaches) focuses directly on the prevention and detection of material errors and irregularities in financial statements. It is applied to each significant class of transactions and related assets involved in an audit. In carrying out our approach, we perform the four steps outlined below: . Identify the types of errors and irregularities that could occur - 42 - Determine the accounting control procedures that should Determine whether the necessary control procedures are Evaluate any weaknesses and determine the nature, These steps allow our auditors to pinpoint areas having weak controls and to extend testing to those areas. In this way, the evaluation of internal control is more exact, and the testing of accounting records becomes more targeted and efficient. Our systematic approach to evaluating and testing internal controls is based on using internal control questionnaires (to review the accounting duties and procedures within the municipality, and to help identify weaknesses in the internal control evaluation to determine the extent of testing required. prevent or detect such errors and irregularities prescribed and are being followed satisfactorily timing, and extent of our audit procedures. Other Quality Control Procedures AuditSCOPE is supplemented by a number of other control procedures. For example, during the audit we complete a number of comprehensive questionnaires. These include: .. Audit planning questionnaire .. Special audit risk questionnaire ..Audit supervision and review questionnaire ..Audit program for the identification and evaluation of litigation, claims and assessments ..Audit program for subsequent events ..Questionnaire concerning compliance with accounting pronouncements (including supplemental questionnaires on specific areas) These procedures allow us to provide clients with the most valuable and efficient service. - 43 - VI. WAGEMENT ADVISORY SERVICES NANAGEMENT ADVISORY SERVICES r" r- c +- Our San Diego office has a locally-based, full-service management advisory staff of 10 consultants, including two with significant governmental experience: Frank Panarisi, to whom we referred earlier, and Joan Martin, a former director of SANDAG. We are one of the few San Diego firms with a locally-based MAS complement: most other firms are required to call on personnel located outside San Diego County to provide consulting assistance to their clients. As consultants, we view ourselves as business problem solvers, providing our clients with objective management advice and technical assistance. Our role is to transfer our knowledge and experience to client personnel. To accomplish this, we involve client personnel in the projects we perform as much as possible, depending on their availability and the nature of the project. This team approach allows us to provide high quality service in a cost-effective manner. Our capabilities in the areas outlined in this section are evidence of our ability to provide quality consulting services on a local basis. DATA PROCESSING Our local consultants have performed a variety of consulting engagements related to various data processing topics. We have significant expertise in the design, evaluation and analysis of effective management information systems, accounting systems and cost-control procedures. Our consultants have developed long-range total automation designs for clients and prepared RFPs for hardware and software. We have also had recent extensive experience in the selection and instalation of hardware and software systems and the analysis of internal controls in computer-based accounting systems. In addition, we have performed long-range planning studies for a wide range of clients. We are prepared to address the various data processing needs of a municipality, including finance, management reporting, fire, police, utilities, purchasing, personnel, vehicle maintenance, and planning. CASH MANAGEMENT We have developed a special program called REACT (Review, Evaluation and Analysis of Cash Management Techniques) to help both public and private sector clients assess the strengths and weaknesses of their cash management efforts. By interviewing key client managers and analyzing existing practices, we are able to render a report suggesting specific actions that, if taken, will result in improved cash management efforts. Clients we have worked with, including the City of San Diego, have found this process results-oriented, practical and workable. c - 44 - r MANAGEMENT EFFECTIVENESS We have found that clients are increasingly concerned with the topic of management effectiveness. In particular, we have noticed that public sector clients are interested in applying private sector methods to develop a more efficient management style. We have worked with governmental agencies to assist in establishing this public-private combination concept and have met with considerable success. We assisted the Seattle, Washington School District in a roject of this nature and identified potential savings in excess of P 5 million. Subsequently, the actual savings exceeded $7 million, and the district publicized the study and its results throughout its area of service. This project shows that we are results-oriented when performing consulting engagements, and continually look for cost savings when working with our clients. OTHER MAS SERVICES Our MAS group also has the capability to provide services in several other management areas. The general areas we offer assistance with follow. . HUMAN RESOURCE PLANNING . ORGANIZATIONAL PLANNING - structure, position description, and . GENERAL ACCOUNTING SYSTEMS - charts of accounts, payroll systems, accounts payable and receivable, cash controls, property records and related matters . MANAGEMENT REPORTING - report structure, integration of financial and operating information, and methods of presentation . FINANCIAL PLANNING AND CONTROL - working capital analysis, return-on-investments analysis, and capital asset consideration . COST AND PROFITABILITY ANALYSIS - analyses and systems for evaluation of profitability of products, customer classes, pricing strategies, etc. executive compensation integrated with data processing, work loan control manuals . WAGE AND SALARY ADMINISTRATION - including job evaluation and . OFFICE AND PAPERWORK METHODS - procedural analysis, work flow r - 45 - VII. PROFESSIONAL FEES ... PROFESSIONAL FEES c c Our professional fees will be based on the actual time required to perform our examinations at hourly rates related to the experience levels of the professionals serving on the engagement. Our efficiency and commitment to serving the City of Carlsbad allow us to propose a maximum fee of $9,000 to perform the required work for the period beginning July 1, 1983 and ending June 30, 1984. We have found that a longer term contract is beneficial to our governmental clients in assuring continuing service by personnel knowledgeable of their operations. In addition, it minimizes the disruption of your staff caused by bringing the auditors "up to speed". For these reasons, we suggest a three year contract, with the initial year fee quoted above to be adjusted in future years only for changes in the cost of living index for San Diego County, and for changes in the scope of work required. In addition, to demonstrate our interest in serving and developing a relationship with the City, we will hold, at no cost to the City, a microcomputer training seminar for 10 City personnel. The seminar will follow the program outlined in the attached brochure. Your RFP requests hourly rates for each staff level if the City were to authorize an expansion of scope for the engagement. We have selected an experienced and qualified team of personnel to serve on your engagement. Our hourly rates for each staff level will be as follows: Levels of Skill Hourly Rate Partner $70 Manager 53 Senior 31 Staff 16 We have made the decision to base our fee for services on substantially lower than standard rates because of our firm's strong desire to serve the City of Carlsbad. The most valuable asset we have is our reputation as a quality professional firm. We will never compromise the quality of our work in order to complete a job within the number of hours estimated. Our estimates are carefully prepared and we, of course, will stand behind them. You can be sure that we will do as much work as is necessary in our professional judgment to determine that our reports are well documented and responsive to your needs. - 46 - c In the event there are significant changes in the activities of the City that would increase the scope of our services indicated in this proposal, we will promptly discuss them with you and provide you with an estimate of the effect of such changes. Our fees for management consulting services are generally priced on a project basis, with a fixed fee being agreed upon in advance of our beginning the project. While we do not charge for our services on an hourly basis, the general ranges in which our management consultants' hourly rates fall are as follows: Level Hourly Rate Partner Manager Staff Consultants $100 - $150 75 - 100 50 - 75 c t - 47 - -- APPENDICES .-. PEFERENCES APPENDIX A ,- e c We believe the best evidence of the quality of our services is the satisfaction of our clients. We provide below the names of clients you may contact regarding our work. All of the engagements indicated are audit clients. Period (Years Served) CITY OF IRVINE Mr. Jeffrey Niven Manager of Fiscal Operations 17200 Jamboree Road Irvine, California 92713 (714) 660-3620 CITY OF ORANGE Mr. Ted Schoettger Director of Finance 300 E. Chapman Avenue Orange, California 92666 (714) 532-0305 COUNTY OF ORANGE Mr. Victor A. Heim Auditor-Controller c/o Procurement Division 1300 south Grand Santa Ana, California 92705 (714) 834-5736 COUNTY OF LOS ANGELES Mr. Mark H. Bloodgood Auditor-Controller 525 Hall of Administration Los Angeles, California 90012 (213) 974-8301 1983 - Present 1983 - Present 1982 - Present 1978 - Present - 48 - /- A COUNTY OF RIVERSIDE Mr. Howard D. Stephens Auditor-Controller 4080 Lemon Street Riverside, California 92501 (714) 787-2975 COUNTY OF SAN BERNADINO Mr. Errol S. Mackzum Auditor/Controller - Recorder 175 W. 5th Street San Bernardino, California 92415 (714) 383-2320 Period (Years Served) 1979 - Present 1979 - Present c - 49 - _- APPENDIX B AFFIRMATIVE ACTIO N, The San Diego office of Deloitte Haskins & Sells is in conformity with our firm's policy for affirmative action for equal employment opportunity. A copy of our firm's Statement of Policy follows. c r - 50 - x I Ohminotion of ?dky 0 We *rll prwi& 8 copy of tha policy statement to each rKrUitinQ Source so that they under. Rand our commitment 8nd our desire for appropriate referds These sources will include ~llegcr where we racruit ond profasioml fmt we may retain to mist us in Our search for talent. 0 We shall Continue to use intern81 reans of communication-such 8s the DHIS Nrwkrtrr, OMS Reports 01 similar publtU1ions-lo glue further CxDreSsion to our br-d policy and to kr! with rpcctftc points of aDpli'RtiDn that have timely figniftumct w c Deloitte Haskins .Sells To Partnm and Employees of Dcloille Haskirls & stir and Othcc Interasled Persons AFFIRMATIVE ACTION FOR EQUAL EMPLOYMENT OPPORfbNlTY- A STATEMENT OF POLlCy OrganiZatiOnal progress in the accounting pro!mion. as 10 any other profewon, is more heavily dependent gn people than it is on any cther resource Thus, just as the Clients we serve are dl- Mne<OrporationS, nonprofit orgdnirations, individuals end governments-so also are the people *seek tn prmide the quality of servce exptcted by ltN3e Clients. Sine a fun&mntal objective of Deloitie Haskitis & %Its is to render excellmt service to the public rnd to the financial Community, we believe the vigorous rccruitment and dwelopmenr of the most talented individuals we c2n fiqd is of paramount importance to Our Continuing vitality and growth. The policy ut ?he firm is to Kek and employ men and women of skill. integrity arid enthusiasm rnd to provide them with the nteans to dmelop professionally and persona!ly. wi:h- at rcgard 10 race. color, reiigian, sex. age, natinnal Origin, irrelwanr handicap. or v, =*eran srarus To enmre that wc maintain a rich diversity of talent, our commitment transcends recruitment and reide in a program of affirmalive action for eQual employment OpDortunitv Tn!s IS a multifaceted program expressive of the firm's Overal! Cmnloyrnrnt policv. it is implrmcn~Pd at each operating location. The firm also recognizes an obligation to provide present employee!$ an environmcr:t which will marrage their personal and professional development and enhance their personal dignlrv To *is mid. it is our policy to pursue and adop! personnel p31icies which make sound business wr?lc and reflect up-to-date management techqiques in keeping with the highes; 1radit:onf of businccr ethics. If our philosophical approach to equal opportunity is to have full effect. it KCms essential to miterate and reaffirm our policy reguiarly and. moreover. to formalize it in writing Therefore. we are articulating in this document a broad, firmwide policv for affirmative action We should point out that our policy IS by no means new-it has been exoressed before many tines and in a mriety of ways. The function of this document is to restate the policy succinctly and compre- hensively, thereby providing a continuing guide for action throuqhout the tirm. The spirit of the hloitte Haskins & 911s program of affirmative action for equal employment opportunity is achieved through an ongoing commitment to brood areas of development. These uws 8nd Our commitfnenl to each rre stated below. .- c 2 Mmwment Guidrnco 0 We shall provide. at the Em iilivc Ollice level, overall direction rnd support to our program by a management reD!esenta!ive wtwIi.n Iwn appointed firmwide Affirmativt Actcon officer . fhis individual IS responsilde fur iiioiiitor iny complidnce with federal rcgulatiom, guiding and @valuating practice ottice proardmb. nrrd rccommending firmwide improvements in affirmative action. practice otfice and shall ensure the eflicacy of the local office program by delgnatlng a man- agement represen:otive tu serve as Equal Employment Opportunity Coordinator 0 The Partner in Charge IS reSponsible ltr d:rCClion 8nd rcvicw of the program in his or her Loa1 Anion Ckns 0 A formal written olan of 6ffirmative actcon IS prepared at the practice offms and ai Executive Office Eacb plan incorporates the policies set forth herein. and also soeclfies the actions to be taken by the office to fulfill the spirit of firm policy. MM8pmOnt Communication 0 Firm management provlda, at least annually, the opoortunitv for each practice office to ore- parea report of itsaffirmativeactionefforts Thisprocessof selfevaluation perwits the mutual exchange of ideas between Executive Office and each Partner in Charge concerning program Kcomplishments or recommended changes hnonrul Dmmlopmont 0 Throughout the firm there IS a nondiscriminatory opportunitv to prcqrcss to partnership and direc torship. 0 All penonnel policies includingcomgensation, benefits and transfers rre administered without mrd to we. Creed, color, national origin, age, sex, irrelevant handicap. or veteran status 0 The firm encourrges acd oromotes the nondiscriminatory participation of all employees in tirm-sporaored social, recreational. and educational activities Our commitment to affir3ative action IS evident throughout the firm by practice office partici- wtion in outreach programs which involve personnel in meaningful activitia supportive of minority groups and women. Members of our management team at all locations are cspeclallv oncoungtd to participate in public service activities that contribute to the social and economic odvancement of individuais from such groups. This document contains but the broad outline of our commitment to provide the equal employ- ment opportunity which is inherently demanded in our system of free enterDrise. Our basic ob- Mtives having been defined. we will continue to refine the direction of our 8cti0n programs in rhe months rnd years ahead. As additional perspective is wined from progras toward our -1. this policy will be reviewed and restated as necessary to rid us in the successful accom. glishmnt of Our task. CITY OF CARLS -- __ - CALIFORNIA CARLSBAD TRXRTHLON - 1984 COMPREHENSIVE ANNUAl FINANCIAL REPORT JUNE 30, 1984 C I TY OF CARLSBAD CAL I FORN I A Comprehensive Annua I Financial Report June 30, 1984 (Prepared by the Finance Department) CITY OF CARLSBAD ~~ - - Comprehensive Annual Financial Report Year Ended &ne 30, 1984 TABLE OF CONTENTS Page I I INTRODUCTORY SECTION: Table of Contents Letter of Transmittal Certificate of Conformance List of City Officials Organization Chart FINANCIAL SECTION: Auditors' Opinion GENERAL PURPOSE FINANCIAL STATEMENTS: Combined Balance Sheet - All Fund Types and Account Groups Combined Statement of Revenues, Expenditures, and Changes in Fund Balances - All Governmental Fund Types Combined Statement of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual - All Governmental Fund Types Combined Statement of Revenues, Expenses, and Changes in Retained Earnings - All Proprietary Fund Types Combined Statement of Changes in Financial Position - All Proprietary Fund Types Notes to Combined Financial Statements i 1 8 9 10 ' 14 15 17 19 21 22 23 i I CITY OF CARLSBAD ___ -~ TABLE-OF CCRJTENTS, Continued Page I I I I I I I I I I I I I I I SUPPLEMENTAL DATA: Governmental Funds: General Fund: Schedule of Revenues Schedule of Expenditures 43 44 Special Revenue Funds: Combining Balance Sheet 45 Combining Statement of Revenues, Expenditures, 47 and Changes in Fund Balances Statement of Revenues, Expenditures and 49 Changes in Fund Balances - Budget and Actual Debt Sen ice Funds: Combining Balance Sheet Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Statement of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual Capital Projects: Combining Balance Sheet Combining Statement of Revenues, Expenditures, and Changes in Fund Balances Statement of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual 59 61 63 67 69 71 ii CITY OF CARLSBAD I - TABLE OF CONTENTS, Continued Page Proprietary Funds: Enterprise Funds: Combining Balance Sheet Combining Statement of Revenues, Expenses, and Changes in Retained Earnings Combining Statement of Changes in Financial Position Internal Sen ice Funds: Combining Ralance Sheet Combining Statement of Revenues, Expenses, and Changes in Retained Earnings Combining Statement of Changes in Financial Position Agency Funds: Combining Statement of Changes in Assets and Liabilities iii 77 79 80 81 82 83 04 I I 1 I 1 1 1 1 1 1 1 1 1 I 1 I I I I- I I I I I I I I I I I I I I I I STATISTICAL SECTION: General Government Expenditures by Function Last Ten Fiscal Years General Revenues by Source, Last Ten Fiscal Years Ratio of General Bonded Debt to Assessed Valuation and Net Bonded Debt per Capita, Last Ten Fiscal Years Computation of Legal Debt Margin Schedule of Direct and Overlapping Bonded Debt Ratio of Annual Debt Service for General Bonded Debt to Total General Expenditures, Last Ten Fiscal Years Revenue Bond Coverage, Last Ten Fiscal Years Demog r ap h ic S t at is t ic s Schedule of Assessed Valuation, Last Ten Fiscal Years Construction and Business Activity, Last Ten Fiscal Years Miscellaneous Statistical Inf ormation Schedule of Principal Employers iv Page 87 89 91 92 93 94 95 96 97 99 100 101 I 1200 ELM AVENUE TELEPHONE 1 CARLSBAD, CA 92008-1989 (61 9) 438-5628 ___. . FINANCE DEPARTMENT November 20, 1984 Honorable Mayor, City Council, and City Manager CITY OF CARLSBAD Carlsbad, California We are pleased to present the 1983-84 Annual Financial Report of the City of Carlsbad to the City Council and the City Manager. This report, in compliance with the National Council on Governmental Accounting (NCGA) statement 83 "Defining the Governmental Reporting Entity", includes financial statements of the City, the Housing Authority of the City of Carlsbad, the Parking and Building Authorities of the City of Carlsbad and the Carlsbad Redevelopment Agency. This report also includes the opinion of our independent certified public accountants, Deloitte Haskins and Sells. In 1981-82 the Finance Department continued its effort to revise prior reporting practices to conform with the standards set by the National Council on Governmental Accounting (NCGA). This effort met with success in early 1982 when the California Society of Municipal Finance Officers (CSMFO) awarded Carlsbad their Certificate of Merit for reporting excellence for the 1980-81 Annual Financial Report. Subsequently, the CSMFO has awarded Carlsbad the award for outstanding financial reporting for the City's 1981-82 financial report. By complying with the standards set by the NCGA and CSMFO, the City's annual report is a more useful document, both internally and externally. The format of the report is designed to fairly set forth the financial position and results of operation of the City as measured by the financial activity within the various fund types. Accounting System and Budgetary Control There have been no major changes in the City's basic accounting system for 1983-84. The City continues to operate on a modified accrual basis for all governmental type funds. This means that revenues are recorded when received in cash unless susceptible to accrual. Revenues that are accrued must be both measurable and collectible within the period or soon enough after the end of the period to pay liabilities of the period. Expenditures, other than interest on long term debt, are recorded when liabilities are incurred. I 1 1 I I I I I 1 I 1 I I I 1 I 1 I I I I I I I I I I I I I I I I I I I The proprietary fund types (the water enterprise, sewer enterprise and the internal service funds) utilize the accrual method of accounting. Revenues and expenses are recorded when e a r ne danal n cu r r e 6, res-pe ctl-ue i y . Internal controls exist within the accounting system to ensure safety of assets from misappropriation, unauthorized use or disposition, and to maintain the accuracy of financial record keeping. These internal controls must be established consistent with sound management practices based on the cost/benefit of the controls imposed. The cost of a control should not be excessive in relation to its benefit as viewed by City management. The internal controls in existence within the City's system are sufficient to ensure in all material aspects both the safety of the City's assets and the accuracy of the financial record keeping system. The Finance Department's internal auditor has conducted several reviews of internal controls on cash, fee collections, payments for services and fixed assets to verify and improve our existing control procedures. Budgetary control is maintained through monthly reports on all revenue and expenditure accounts as well as special reports summarizing the financial position of the City. The City Council has the authority to control the budget through adoption of a formal budget at the beginning of each year and by amending the budget as necessary through the year. Expenditures cannot exceed budgeted figures. All appropriations expire at year .end unless specifically carried into the new fiscal year by Council action. General Governmental Functions The general government function is supported by revenues received and recorded in the general fund, special revenue funds, debt service funds, and capital project funds. In 1983-84, revenue in all qovernmental funds totaled $24.1 million. This represents an increase of about $5.8 million or 31.8% over shown below: City of Carlsbad Governmental Fund Types Revenues 1983-84 1982-83 1983-84 Revenue Revenue (In $1 000) n&- Revenue Source Taxes Licenses & Permits 771 Intergovernmental Revenue 2,551 Charges for Service 2,452 Fines & Forfeits 231 Interest Income 1,397 Miscellaenous Revenue 179 TOTAL REVENUE 'TiqYz (In $1 000) ,512.644 2;452 1,778 4,748 256 1 , 528 726 $2qm % of Total 52.4% 10.1 7.4 19.7 1.1 6.3 3.0 100.0% 1982-83 revenue as 1983-84 1982-83 over (under $1,911 1 , 681 (773) 2,296 25 131 547 $m % Change 17.8% 218.0 (30.3) 93.6 10.8 8.6 305.6 31.8 2 I I I 1 B 1 1 I I 1 I I I I Revenue from taxes in 1983-84 increased by almost $2 million or 17.8% over 1982-83. Property tax revenue was up by almost $390,000 or 9%; sales tax revenue increased by $916,000 or -- s 1 igh-t-il y more -than 2 3% o ve r la st ye ax j and- transieat---escu piwe-y-- taxes were up by about $210,000 or 26%. Other tax revenues followed the same trends seen in these mafor sources. The strong improvement in tax collections was primarily due to the generally improving California and national economic climate and the growth experienced in the local North San Diego County area. Licenses and permits were up by $1.7 million or 218% over 1982-83. The primary factors in this growth were building permit revenues and the City's license tax on new construction. Income from building permits rose by $580,000 between 1982-83 and 1983-84; an increase of 118%. The City's license tax on new construction, a tax paid by builders who will place new demands upon existing City facilities, went into effect in late 1982-83. 1983-84 represents the first full year of existence for this source of revenue. During 1983-84, $980,000 was received by the City in license taxes on new construction. Business licenses also moved ahead by about $70,000 or 26% over 1982-83. The license and permit types of revenue are particularly sensitive to changes in the economy tied to new construction. Carlsbad has experienced a very strong growth period during 1983-84 which appears to be continuing into 1984-85. Intergovernmental revenues dropped by about $770,000 or 30% between 1982-83 and 1983-84. This drop is primarily due to the completion of a major dredging project in 1982-83. Capital project grants in 1983-84 were substantially below the 1982-83 level. Charges for services have been increasingly important to local governments in California since the passage of the Property Tax Limitation Initiative (Proposition 13) in 1979. Charges for services include general fund sources such as developer fees, park or library fees and ambulance or public safety fees. Fees have been adjusted in many areas to reflect the cost of providing services. Expenditures from government fund types totaled $17.2 million in 1983-84. This is an increase of about $1.7 million or 11% over 1982-83. These expenditures are distributed as shown below: City of Carlsbad Governmental Fund Types Expenditures 1983-84 1982-83 1983-84 Expenditures 1983-84 Expenditures % of over (under) % Expenditure Type (In $1,000) (In $1,000) Total 1982-83 Change General Government S 2.272 s 2.562 14.9% S 290 12.8% Public Safety . 5;286 Public Works 2,935 Culture & Recreation 2,573 Welfare 72 7 Debt Service 43 7 Capital Projects 1,233 TOTAL EXPENDITURES $ 15,463 -I 5,983 3,443 2,896 825 458 1,003 $17,170 - 34.8 697 13.2 20.1 508 17.3 16.9 323 12.6 4.8 98 13.5 2.7 21 4.8 5.8 ( 230 1 (18.7) I 1 100.0% $1,707 11.0 - - 3 I I I I I I I I I I I I I I I I I I I The reduced water sales revenue shown in the above table is directly related to the water service agreement with CRMWD. As previously described, revenue from water consumption charges are now passed tTrough t~o~tRFttDr ~- Revenue from sewer service charges totaled $1.3 million in 1983-84 compared to $960,000 in 1982-83. This increase of 35% is due to three factors. First, the City experienced a sewer rate increase during 1983-84. Second, the agreement with CRMWD gave the City the ability to more closely control all utility services within the City. The merging of the City and CRMWD data bases allowed the City to substantially reduce the number of water customers who had previously escaped paying sewer fees. Third, the City has been growing at a very rapid pace. During the majority of 1983-84, the City utility users base was rising at a rate of 2% per month. This rapid growth in utility users can also be seen in the growth in the major facility fee revenue. During 1983-84, the City collected $1.7 million in major facility fees compared to $657,000 in 1982-83, an increase of over 150%. These fees are paid by developers as they connect new buildings or structures to the water and sewer systems. Revenues from other charges for services and reimbursed expenditures primarily represent the activity of the City’s internal service funds. The changes in revenues indicate the increased charges to user departments for insurance or vehicle maintenance services. Expenses in the proprietary funds totaled $4 million for 1983-84 compared to $3.7 million for 1982-83, an increase of about $344,000 or 9.4%. These expenses are summarized below: City of Carlsbad Proprietary Fund Types Expenses 1983-84 1982-83 1983-84 Expenses Expenses Operating Expense (In $1,000) Personnel Services $ 914 Repairs 8 Maint. 328 Professional Svcs. 5 38 Insurance 102 Purchased Water 92 6 Capital Outlay/Projects --- Fuel 198 Claims 402 Other Expenses 250 Office Expense 20 TOTAL EXPENSES $3,678 - (In $1,000) $ 912 53 420 606 18 577 52 187 648 549 $qim - 4 % of Total 22.8% 1.3 10.4 15.1 0.4 14.3 1.3 4.6 16.1 13.7 100.0% - 1983-84 over (under) 1982-83 $ (2) 33 92 68 (84) (349) 52 (11) 246 299 $344 - % Change (0.21% 165.0 28.0 12.6 (82.4) (37.7) (5.6) 61.2 119.6 9.4 The City had no major changes in operations during 1983-84 which would cause increased or decreased expenditure levels. The majority of the increase in expenditures in governmental funds is due to general cost increases and minor changes in staffing levels , off= byreduced spending70Fi5p-iptal projects. __ - Spending for capital projects will increase significantly in 1984-85 as several major projects enter the construction phase. The City's Public Safety/Service Center, major storm drain projects and several street projects will begin construction in the first part of 1984-85. Proprietary Fund's This category includes the water and sewer enterprise funds as well as the workers' compensation and general liability self- insurance internal service funds and the central garage internal service fund. During 1983-84, the City began to implement the water service agreement between the City and the Costa Real Municipal Water District (CRMWD). Under this agreement the City becomes the water retailer to all residents of the City while CRMWD becomes the wholesaler. CRMWD is also responsible for the construction and maintenance of major water lines, dams, reservoirs or other major facilities. The City now bills approximately 11,000 water customers using 300 million gallons each month. CRMWD absorbed the City's water maintenance crew (7 employees) into their organization during 1983-84. Revenue from water sales is shared between the City and CRMWD; the City receiving 100% of the ready to serve or flat monthly fee and CRMWD receiving 100% of the water consumption charge based on units of water used. Proprietary Fund Revenues totaled $5.4 million in 1983-84 compared to $4.2 million in 1982-83, an increase of $1.2 million or 30%. City of Carlsbad Proprietary Fund Type Revenue 1983-84 1982-83 1983-84 Revenue Revenue % of Revenue Source (In $1,000) (In $1 000) Total Metered Water Sales $ 1,606 .m 24.1% Sewer Service Charges 961 1,297 23.9 Sewer Connection Fees 657 1,663 30.6 Other Charges for Services 616 844 15.5 Reimbursed Expenditures 327 TOTAL OPER. REVENUE $ 4,167 322 5.9 $5,435 100.0% 1983-84 over (under) 1982-83 $ (297) 336 1,006 228 (5) $ 1,268 % Change (18.5)% 35.0 153.1 37.0 (1.5) 30.4 5 -_ I I I I I I I I I I I I I I I I I Major changes occurred in the water funds cost for purchased water which reflects a decline of about $350,000. This reduction is a direct result of the agreement with CRMWD described above. Other major changes are found in claims expenses where the City records costs of the workers' compensation and liability self- insurance activities. Total expenses rose from $402,000 in 1982- 83 to $648,000 in 1983-84, an increase of 61%. -_ The increase in repairs and maintenance and professional services is due to additional costs associated with operating the Encina Water Pollution Control facility and the City's sewer system which provides sewer service to the City's 40,000 residents. Total revenues in the enterprise funds were sufficient to support all expenses of the respective operations. In the internal service funds, both the workers' compensation and liability self insurance funds recorded losses for the year. At 3une 30, 1984, the City contributed $150,000 to the liability fund to help offset this loss. Self Insurance Proqram The City has been self-insured for workers' compensation since September, 1978. The activity for this program has been contained in the Workers' Compensation Self-Insurance Internal Service Fund. Workers' compensation claims for 1983-84 amounted to $333,000. The General Liability Self-Insurance Fund was established near the end of fiscal 1980-81. This year represents the third full year of operation under the liability self -insurance program. During 1983-84, claims totaling $314,000 were paid out of this fund. Contributions of $150,000 were made from the General Fund to support the program and to bring the fund equity up to an acceptable level. Cash Hanagement The City Treasurer is charged with the responsibility of safe- guarding the City's assets, receiving all payments due the City and investing all inactive funds. This year the City Treasurer earned about $2.1 million in interest on investments in all fund types from instruments earning from 7.5% to 12.5%. This represents an increase of about 15% over the 1982-83 total of $1.8 million. Funds are invested in various types of notes and certificates and are fully insured or collateralized. At 3une 30, 1984, the treasurer had 97% of all available funds invested. 6 Bonded Debt ~ _- The City's total outsLandina_aempal Jxmde-U- 1984 was $3.8 million or about $95 per capita. The City had water revenue bonds outstanding in the amount of $1,027,000. The following report includes detailed listings of debt service requirements and other pertinent information on the City's debt administration activities. Economic Trends Carlsbad has experienced a very strong recovery from the relatively weak economy of early and mid 1982-83. In the last part of 1982-83, the City's retailers and builders began to show signs of recovery which accelerated throughout 1983-84 and continued into 1984-85. The City can expect strong tax revenues in sales tax, property tax and transient occupancy tax for the 1984-85 fiscal year. In addition, the rate of building in Carlsbad has continued to grow throughout 1983-84 and should continue at a high level for at least the first half of 1984-85. The addition of several major hotels to the downtown area and along Interstate 5 will improve the City's transient tax revenue base substantially. The early part of 1984-85 shows no signs of slowing for the Carlsbad economy. Acknowledgements The preparation of this report has been the joint effort of our independent certified public accountants, the Finance Department and Central Services Department. Each party has played a very important part in the creation of this comprehensive financial report. We wish to express our appreciation to the staff of Deloitte Haskins and Sells, the Finance Department and Central Services for their dedicated efforts. Our appreciation also goes to both City management and the Council for their support of the Finance staff and this project. R es p ec t f u lJ- y Su bm f t t e d , ,/ /* -, ..I 1.' ' ' < I- < <-' i-) , if ' di,d 3amesLF!- Elliott Fihance Director ', 3Fkfdb 7 I I r I I I I I I I I I I I I I I I I rrl =e: t- 0 t- w CII 2 w e e n Y 8 I CITY OF CARLSBAD ELECTED CITY OFFICIALS Mary H. Casler, Mayor Claude A. Lewis, Council Member Ann 3. Kulchin, Council Member Richard 3. Chick, Council Member Mark V. Pettine, Council Member Aletha L. Rautenkranz, City Clerk William C. Esterline, City Treasurer AOHINISTRATION AND DEPARTHEW HEADS Frank Aleshire, City Manager Frank Mannen, Assistant City Manager/Administration Vincent F. Rfondo, 3r., City Attorney Ronald Beckman, City Engineer David Bradstreet, Parks and. Recreation Director James F. Elliott, Finance Director Ruth Flethcer, Purchasing Officer Roger Greer , Utilities /Maint enance Vincent Jimo, Police Chief Clifford Lange, Library Director Martin Orenyak, Building and Planning 3erome No. Piet i, Personnel Director 3ames Thompson, Fire Chief Director Director CHAIRPERSONS, COMMISSIONS AND BOARDS David Bates Personnel Board Robert (Andy) Borden Building Authority Richard Goodwin Parking Authority 3eff Punches Sharon Schrarn Library Board Scott Wright Traffic Sat ety Commission Parks and Recreation Canmission I I I I I I I I I I I I 1 1 I 9 I I I-- I I I I I I I I I I I I I I I I r i= a 5 0 2 0 N c 3 _. * 6 0) c tn c 3 (1 w a 10 I I This Page Intentionally Left Blank .. 11 I I I I- I I I I I I I I I I I 3 I I I I r. 0 I t i nanc I a I Sect i on 12 I I I I I I I I I I 1 This Page lntentlonally Left Blank I I I I I I 13 I I Deloitt e Haskins+Sells Suite 1900 San Diego. California 92101 -8198 (61 9) 232-6500 TWX 91 0-335-1 573 I AUDITORS' OPINION Honorable Cit Council We have examined the combined financial statements of the City of Carlsbad as of June 30, 1984 and for the year then ended, as 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. City of Carls g ad, California In our opinion, the combined financial statements referred to above present fairly the financial position of the City of Carlsbad at June 30, 1984, and the results of its operations and the changes in financial position of its proprietary fund types for the year then ended, in conformity with generally accepted accounting principles applied on a basis consistent with that of the preceding year after giving retroactive effect to the chan e, with which we concur, in the method of accounting for compensated absences as described in Note 2 to the financial statements. Our examination also comprehended the statements and schedules as of and for the year ended June 30, 1984 as listed in the supplemental data section of the foregoing table of contents. In our opinion, such supplemental statements and schedules, when considered in relation to the combined financial statements present fairly, in all material respects, the information shown therein. October 4, 1984 ' 14 CITY OF CARLSBM) 1 1- I II I I B I I 1 I I 1 I I 1 1 Combined Balance Sheet All Fund Types & Account Groups 3une 30, 1984 Governmental Fund Types Cap ita1 -peciainbt e General Revenue Service Projects Assets: Cash and investments - (Note 5) $ 684,065 $ 4,730,653 $1,566,201 $11,795,377 Receivables: Taxes 452,491 Accounts 411,404 Accrued interest 203 , 284 Due from other governments --- Advances to other funds 573,946 Inventory, at cost 7,589 Prepaid expenses 43 , 500 Cash & investments (Note 5) -- Accrud fnterest -- - Investment in sewage treat. fac. --- Property, plant and equipment (net of accumlated depreciation) (Note 6) --- Amount available in debt Amount to be provided for retire- Restricted assets: service funds --- merit of general long-term debt --- Total assets $ 2,376,279 Liabilities: Accounts payable $ 468,7M Accrued wages payable 1,002,022 Due to other funds --- Advances from other funds --- Advances from other governments --- Deposits payable --- payable (Note 13) -- - Prepaid annual contributions --- Estimated claims payable --- Accrued interest payable --- Revenue bonds payable -- - (Note 7) --- unamortized discount of $7,404 and current portion - Note 7) Deferred revenue -- - Obligations under capital lease (Note 8) --- Other payables Deferred compensation Payable from restricted assets8 General obligation bonds payable Revenue bonds payable (net of --- Total liabilities - vi5TE %%%%id capital -- - Investment in general fixed Retain. earn (deficit)(Note 11) --- Fund balances (Note 11): 905,553 assets --- 17,275 12 5,827 48,926 --- 59,798 --- - -- $4,862,491 --- $1,601,146 $11,795,377 $ 205,812 3,014 4,180 98,940 --- --- $ 19,112 1,065 -- - 1,939 --- --- --- 569,766 e-- --- --- --- e e- --- --- --- 1,582,034 11,222,607 1,582,034 11,222,607 $1,601,146 $11,795,377 4,479,474 4,479,474 $4,862,491 Total fund equity 905,553 Total liabilities and fund equity $ 2,376,279 See accompanying notes to combined financial statements 15 I I C I I I I I I I I I I I I I f I I Fiduciary lot als P mprietaiy4%mt-J+- Ad- (Wly! Internal General General Lona- hne 30. June= -I Term Debt 1984 1983 Flxed ksets Servlce Enterprise $18,531,357 $5,329,441 $1,739,697 $2,389,004 $28,234,438 469,766 1,472,206 244,699 48,926 573,946 109,690 , 618,525 12,998,980 112,804 --- 154,805 1,114,154 248,872 109,OeO 374,166 119,840 325,488 556,351 10,703 --- --e 1,060,790 643 --- --- 105,295 6,392 618,525 12,998;980 --- --- -e- --- 10,532,7 38 588,561 $18,496,987 29,618,286 1,582,039 2 802,007 $78.886.38 7 40,692,992 1,462,841 3,410,533 567.111.182 --- e-- $1,582,034 2,802,007 --- $2,328,901 --- $2 , 389,004 --- $ 18,496,987 $4,384,041 S30,652,161 $ 934,223 272,443 109,080 374,166 87,199 1,755,113 228,576 63,966 299,643 $ 973,819 12,516 --- --- --- 88,512 $ 90,890 4,862 $ 1,259,402. 1,024,353 573,946 98,940 2 153,073 324,443 71,071 407,410 28,438 125,000 3,800,000 $2,064,561 324,443 - -- e-- --- --- --I 487,410 28,438 125 ,OOO I-- --- --- 125,000 3,9 15,000 S3,800,000 894,596 2,563,778 894,596 2,563,778 473.598 893,362 --- --a --- -a- _-- 793.623 473,598 110,443 4,384 , 041 --- -e- --- 110;443 164’751 13,988,491 ~~ 4,186,659 583,162 2,095,456 2 , 389,004 18,812,487 20,907,943 23,095,399 16,562,6 57 5,505,309 11,871,672 57,035,037 $67,111.182 19,496,987 - -- 18,496,987 7,303,298 18,189,668 64,897,896 $78 , 886 9 387 --- --e --- 7,653,015 --- 26,465 , 502 S30.652.161 ( 349 ,7 17 1 --- 1,745,739 $2,328,901 - --- e-- --- --- $2,389,004 18,496,987 $18,496,987 --- $4,384,041 - 16 CITY OF CARLSBAD Combined Statement of Revenues, Expenditures and Changes in Fund Balances - All Governmental Fund Types Year ended 3une 30, 1984 Revenues: Taxes Licenses and permits Intergovernmental revenues Charges for services Fines and forfeits Interest income Miscellaneous revenues Total revenues Expenditures : . General government Public safety Public works Welfare Culture and recreation Capital projects Debt service expenditures: Principal retirement Interest and fiscal charges General $1 1,392,335 2,451,817 2,491 2,182,267 256,471 565,281 55,365 16,906,027 2,534,868 5,813,451 1,907,416 2,627,307 -- - Total expenditures 12,883,042 Excess (deficiency) of revenues over expenditures 4,022,985 Other financing sources (uses): Operating transfers in -- - Operating transfers (out) (348,400) Total other financing sources (uses) (348,400) Excess of revenues and other sources over expenditures and other uses 3,674,585 previously reported 703,569 Fund balances at beginning of year as Prior period adjustment (Note 3) 62,240 Fund balances at beginning of year as adjusted 765,809 Cumulative effect of changes in accounting principle (Note 2) ( 492,296) Residual equity transfers in 543,000 Residual equity transfers (3,585,545) Fund balances at end of year $ 905,553 See accompanying notes to combined financial statements 17 Special Revenue $1,063,313 I, 775,096 --- --- --- 451,635 12.637 3,302,681 11,850 I, 501,152 825,236 136,814 364,059 --- 2,839,111 463,570 463,570 4,558,904 4,558,904 --- --- ( 543,000 $4,479,474 1 I I- ! I I i II I i I I 1 I 1 I 1 I I I I I- I I I I I I I I I I I I I I I I Tot ac (Memorandum Only) 3une 30, 3une 30, 1984 1983 $10,732,787 771,240 2,551,262 2,451,708 231,086 1,396,896 179,271 18,314,250 $12,644,122 2,451,817 1,777,587 4,747,95 1 256,47 1 1,542,092 378,245 23,798,285 247,431 4,491 --- --- - -- - -- --- 1 15,000 243,047 362,538 ( 11 5,107) 348,400 --- 2,551,209 5,813,451 3,408,568 925,236 2,764,121 1,003,261 2,272,174 5,285,609 2,935,279 727,155 2,573,014 1,233,048 185,000 252.147 1 15,000 243,047 16,723,893 15,463,426 639,202 2,702,944 --- --- 2,850,824 7,074,392 514,570 ( 778,053) ( 263,483) 2,587,341 348,400 ( 348,400) 348,400 233,293 1,462,841 1,348,741 ( 1 14,100) --- --- --- 7,074,392 2,702,944 5,146,358 5,084,118 ( 62,240) --- 3,435,545 --- 11.871,672 9,153,705 130,626 9,284,331 ( 114,100) 11,757,572 ( 49 2,296 3,978,545 ( 4,128,545) $18,189,668 $11,871,672 $ 11,222,607 -J $ 1,582,034 18 I 1 I 1 I I 1 I 1 I 1 I I I I I I - Codined Statwnt of Revenues, Expenditures and Changes in Fund Balances - Eludget & Actual All Governmental Frnd Typea Year ended &ne 30, 1984 Spacial Revenue Funds Variance f avorrble (unfavorable) General Fund Variance f avorable (unfavorable) S 918,335 861,817 2,491 732,967 (134,719) (8,529) (22.635) . 2,349,727 638,561 229,992 321,528 159,161 --- --- Rwtnuarr 1-9 L1can-s Md permits Intergovermntal revenues Charges for wrvices Ffm nd forfeits Interest 1- His~llan8Ous NVWOS Total Revenws General government Public Safety Public Works Welfare Culture and recreation Capital projects Debt aervica e~itums: Principal retiramt Total Expenditurr Expenditures: Interart md fiscal ch.9. Bud?#t Actual S 973,544 S 1,063,313 8udQet 1,590,000 S 10,474,000 --- 1,449,- 265, 000 700,000 78.000 14,556,300 3,173,429 6,042,943 2,228,944 2,786,468 --- --- ACtU.1 S 11,392,335 2,451,817 2, b91 2,182,267 256,471 565,281 55,365 16,906,027 2,534,869 5,813,451 1,907,416 2,627,307 --- --- S 89,769 (839,224) --- --- 367,633 12.637 ( 369,183) (ii,emo) --- 2,350,282 (35,254) 119,101 2.1 15,816 - -- --- 4,538.09S --- 1,775,096 --- --- 451,635 12.637 3.302.681 ii,am --- 1,501,152 825.236 136,814 364,039 --- 2,839,111 463.570 --- --- 463.570 4,558,904 4,518,904 --- --- (543.000) --- --- 3,851,434 789,982 255,915 2,479,875 --- --- 7,377,206 --- -e- 1,348,742 3,698,469 (3.705.342) 4,168.912 --- . and other sources owr expend- itw ud other -8 (23,884) ' 3,674,585 previously nportod 703,569 703,569 Fund balanas at boginning of year u 4,160,912 3,698,469 --- 62.240 62.240 (492,2%) ( 3,042,545) S 225.668 Prior parid-d)rt.ent (Note 3) --- 62.240 Fd bal.ncas at beginning of year Cwlatiw offat of change in u d*td 703.569 765.809 accounting principle 1-0 2) --- (492,296) Residual equity transfers in (out) --- (3.042.545) Fund balances at end of you s 679,683 s 905,553 See .ecoq.nying notes to collbirud flnmcial statmmts (543,0001 s 310,562 S 4,479,417b - 19 I Capital Rolrt Fudr VUlMa Debt Service Funds v.rimC0 fJWCrbh (unfavorable) s (8,821) a** 387,040 310.243 757,146 --- --- --- Actual $ 79,179 2,565,684 387,040 310.243 3,342,146 --- --- --- e-- 4,491 --- e-- --- e-- --- 115,m 243.017 362.538 (115.107l 3bo.400 348.400 115,Ooo 243.386 Mz.877 (121.022) w.400 3bo.wr) ' --- 4,610,430 5.367.576 2,072.944 5,146,358 (62.240) 5*004,118 5, 367.576 (2,664,6321 5.915 233.293 l,WZ,Ml 114.100 1,348.741 --- --- $ 1,582,034 (114.100) ~~ --- 3,435,5@5 S 2.481.726 S 11.222.607 3, i35.545 S 8.740.881 S (108,195) - -- 20 I CITY OF CMLSBAD Conbi ned Statement of Revenues, Expenses, C-haqU*€ai* Year ended &ne 30, 1984 Totals I I 1 I I 1 .I 1 I I I I I I I I (Memorandum Only) %ne 30, 3une 30, Internal Service Enterprise 1984 1983 Operating revenues: Metered water sales Sewer service charges Sewer construction fees Other charges for services Reilnbursed expendi tures Total operat ing revenue $ 1,309,379 1,160,834 1,799,010 129,437 --- $ 1,309,379 $ 1,606,202 1,160,834 961,217 1,799,010 657,370 843,716 615,506 321,648 326,906 5,434,587 4,167,201 $ 714,279 321,648 1,035,927 4,398,660 Operating expenses: Personnel services Office expenses Repairs and maintenance Professional services Insurance Purchased water Loss on disposal of property Bad debt expense Depreciat ion and arnort i zat ion Fuel Supplies and parts Claims expense Other operating charges 723,394 51,666 638,150 16,331 577,081 16,092 56,021 256,250 361,649 --- 188,554 1,246 77,208 --- --- --- --- --- 145,452 187,316 72,137 2,784 648,191 91 1,948 52,912 438,857 638,150 18,331 577,081 16,092 56,021 401,702 187,3 16 72,137 648,191 2,784 914,233 21,468 328,142 537,524 102,322 926,347 --- --- 159,396 198,094 84,820 2,973 402,854 Total operating expenses Operating income (loss) Non-operating revenues (expenses) : Interest income Interest expense and fiscal agent fees Sale of property Total non-operating revenues Net income (loss) before operating transfers Operating transfers in Net income ( loss) 1,322,888 ( 286,961 ) 2,698,634 1,700,026 4,021,522 3,678,173 1,413,065 489,028 403,675 ( 56,875 1 - -- 135,8% 539,571 404,991 ( 56,875 1 ( 64,492 1 18,134 5,764 500,830 346,263 19913.8% 83 5.29 1 --- 18,134 154,030 346,800 (132,931) --- 2,046 ,8 26 --- --- 15;553 1,913,895 850,844 2,046,826 Retained earnings (deficit) at Prior period adjustments (note 3) Retained earnings (deficit) at beginning of year as adjusted Retained earnings (deficit) at beginning of year (69,263) ( 147,523) 5,574,572 31,617 5,606,189 5,505,309 4,654,465 (115,906) --- (216,786) 5,389,403 4,654,465 $ '(349,717) $ 7,303,298 $ 5,505,309 - end of year (note 11) $ 7,653,015 See accompanying notes to colnbined financial statements 21 CITY OF CARLSBAO Combined Statement of Changes in Financial Position I rr Year ended 3une 30, 1984 1 Sources of working capital : I Operations Net income (loss) $ Less gain on sale of property Items not requiring working capital: Depreciation and amortization Loss on disposal of property Working capital provided by operations Proceeds from sale of property I 1 Contribution from other funds Enterprise 2,046,826 --- 256,250 16,092 2,319,168 12,727 Internal Service $(132,931) (18,134) 145,452 --- (5,613) 36,952 156.439 Tot a1 (Memorandum Only) June 30, June 30, 1984 1983 $1,913,895 $ 850,844 (18,134) --- 401,702 159,396 16,092 --- 2,313,555 1,010,240 36,952 --- 169,166 1,065,609 Total sources of working capital 2,331,895 187,778 2,519,673 2,075,849 'Uses of working capital: equipment 36,735 161,337 ' 198,072 946,818 1 Decrease in long-term revenue bonds payable --- --- --- 1 1 5,000 Acquisition of property, plant, and Net decrease (increase) in other restricted assets and related liabilities 23,033 23,033 (809,244) I Reduction of deferred revenue 136,000 --- 136,000 --- Total uses of working capital 195,768 161,337 357,105 252,574 I Net increase in working capital $ 2,136,127 $ 26,441 $2,162,568 $1,823,275 ----.- Elements of net increase (decrease) in 1 unrestricted working capital: Cash and investments Accounts receivable I Accrued interest receivable Inventory Prepaid expenses 1 Accounts payable Accrued wages payable Estimated claims payable Due to other funds I Deposits payable $1,902,569 608,591 ( 28,083 ) (7,107) (169,146) (152,890) (8,014) --- (9,793) Net increase in working capital $ 2,136,127 See accompanying notes to combined financial statements I $ 275,827 $ 2,178,396 $1,984,484 (6,722) (34,805) 15,259 (7,107) 6,970 --- (169,146) 170,221 (54,247) (207,137) (257,638) (650) (8,664) 3,570 ( 187,767 ) ( 187,767) (92,082) --- --- 12,397 --- (9,793) (8,945) $ 26,441 $ 2,162,568 $1,823,275 --- 608,591 (10,961) --- 22 CITY OF CPRLSBAD. Notes to Combined Financial Statements 3une 30, 1984 (1) Summarv of Sianificant Accountina Policies The accounting policies of the City of Carlsbad, California conform to generally accepted accounting principles for governmental units. following is a summary of the more significant policies: (a) I I I I The Description of the Reporting Entity The financial statements of the City of Carlsbad include the financial activities of the City, the Housing Authority of the City of Carlsbad, the Parking and Carlsbad Redevelopment Agency. Their financial operations are closely related and the City Council has a continuing oversight responsibility over the entities. The oversight responsibility is determined on the basis of budget adoption, taxing authority, funding and appointment of the governing board. Building Authorities of the City of Carlsbad and the (b) Fund Accounting 1 I I I The accounts of the City are organized on the basis of funds or account groups, each of which is considered to be a separate accounting entity. The operations of each fund or account group are accounted for by providing a separate set of self-balancing accounts that comprise its assets, liabilities, reserves, fund balancetretained earnings, revenues, expenditures or expenses. The various funds and account groups are summarized by type in the financial statements. Fund types and account groups used by the City are as follows: GOVERNMENTAL FUNDS: I General Fund The General Fund is the general operating fund of the City. All gen- era1 tax revenues and other receipts that are not allocated by law or contractual agreement to some other fund are accounted for in this fund. The fund is utilized to account for payments made for general operating expenses and capital improvement costs which are not paid through other funds. I I Special Revenue Funds The Special Revenue Funds are used to account for revenues derived from specific sources which are restricted by law or administrative regulation to expenditures for specified purposes. I I 23 I k- I I I I I I I I I I I I I I CITY OF CARLSBAD Notes to Combined Financial Statements, Continued Debt Service Funds Debt Service Funds are used to account for the accumulation of re- sources for, and the payment of, general long term debt principal, in- terest and related costs. Capital Project Funds Capital Project Funds are used to account for financial resources to be used for the acquisition or construction of major capital facil- ities (other than those financed by proprietary funds) . PROPRIETARY FUNDS Enterprise Funds The Water Utility Fund and the Sewer Enterprise Fund are used to account for operations that are financed and operated in a manner similar to a private business enterprise where the intent of the City Council is that the costs (expenses, including depreciation) of providing goods and services to the general public on a continuing basis be financed or recovered primarily through user charges. Internal Service Funds Internal Service Funds are utilized to finance and account for activ- ies involved in rendering services to departments within the City. Costs of services are accumulated in these funds and charged to user departments as such costs are incurred. FIDUCIARY FUND Agency Funds The Agency Funds are used to account for assets held by the City in an agency capacity for individuals and private businesses . ACCOUNT GROUPS General Fixed Assets Account Group General Fixed Assets have been acquired for general governmental pur- poses. Assets purchased are recorded as expenditures in the govern- mental fund types and capitalized at cost in this group of accounts. In the case of gifts or contributions, such assets are recorded in general fixed assets at fair market value at the time received. 24 I I I CITY OF CARLSBAD Notes to Combined Financial Statements, Continued Fixed assets consisting of certain improvements other than buildings, including roads, bridges, curbs and gutters, streets and sidewalks, and drainage systems have not been capitalized. Such assets normally are immovable and of value only to the City; therefore, stewardship for capital expenditures are satisfied without recording of these assets . - No depreciation has been provided on general fixed assets. General Long-Term Debt Account Group This group of accounts is used to account for General Long Term Debt (backed by the full faith and credit of the City) including the City's obligations under capital leases. (c) Measurement Focus and Basis of Accounting The proprietary (enterprise and internal service) fund types are accounted for on an "income determination" or "cost of services" measurement focus. Accordingly, all assets and liabilities are in- cluded on the balance sheet, and the reported fund equity provides an indication of the economic net worth of the fund. Operating state- ments for proprietary fund types report increases (revenues) and de- creases (expenses) in total economic net worth. Governmental (general, special revenue, debt service and capital pro- jects) fund types are accounted for on a "spending" measurement focus. Accordingly, only current assets and current liabilities are included on their balance sheets, and the reported fund balance pro- vides an indication of available, spendable resources. Operating statements for governmental fund types report increases ( revenues) and decreases (expenditures) in available spendable resources . Agency funds are custodial in nature (assets equal liabilities) and do not involve measurement of results of operations. The modified accrual basis of accounting is followed by the govern- mental funds and fiduciary fund. Under the modified accrual basis of accounting, revenues are recorded when measurable and available . Available means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. Expenditures are recorded when liabilities are incurred, except that interest on long term debt is considered an expenditure in the period in which it is budgeted. The accrual basis of accounting is followed by the proprietary funds. I I I I I I I I I I I 25 I I r I I I I I 1 I I I I I I I I I I CITY OF CARLSBAD Notes to Combined Financial Statements, Continued Investments Investments are stated at cost, which approximates market. Inventories Inventories within the various fund types consist of materials and supplies which are valued at the lower of average cost or market and are recorded as expenses when consumed. Comoensated Absences Vacation pay is payable to employees at the time used or upon termination of employment. maximum of 29 days in any one year for miscellaneous employees and safety employees and 40 days in any one year for management employees. Sick leave accrued but unused is cumulative from year-to-year. employees within the merit system, sick leave may not be taken as vacation or compensated for in cash. Permanent miscellaneous employees (as defined) accumulating and maintaining 100 hours of sick leave can convert up to 12 days of sick leave to vacation at a ratio of three sick leave days to one vacation day. Upon retirement, such employees may also convert accrued and unused sick 1eave.to extend service time at the rate of 25 sick days to one month of service time. Vacation days are cumulative up to a For Budqetary Data The City follows these procedures in establishing the budgetary data reflected in the financial statements: 1. During May or 3une, the City Manager submits to the City Council a proposed operating budget for all funds of the City for the fiscal year commencing the following 3uly 1. The budget includes proposed expenditures and estimated revenues on a line item basis. 2. Public hearings are conducted at City Council meetings to obtain citizens' comments during 3une. Committee facilitates this process. A Citizens Budget Reveiw 3. Prior to 3uly 1, the budget is legally enacted through passage of an appropriation resolution. 4. The City Manager is authorized to make transfers of appropriated amounts within a fund and function for up to $10,000. Revisions that alter the total appropriations of any fund or function must be approved by the City Council. conducted each year. approved by the City Council at that time. A mid-year budget review is Any major changes to the adopted budget are 26 CITY OF CARLSBAD Notes to Combined Financial Statement, Cont inued 5. Monthly budget control reports are generated to assist the Finance Department and other department heads in controlling the budget. 6. Budgets for the General, Special Revenue, Debt Service, and Budgeted amounts Capital Projects Fund are adopted on a basis consistent with generally accepted accounting principles . contained within this report are as amended by the City Council. (h) Self -Insurance The City is self-insured for general liability and workers' compensation claims up to $50,000 and $100,000 per occurrence, respectively, with a yearly maximum aggregate liability of $250,000 and $10,000,000, respectively, and purchases outside insurance coverage for individual claims in excess of that amount. (i) Memorandum Only Totals Columns in the accompanying financial statements captioned "Totals (Memorandum Only)" are presented as additional analytical data and do not present financial statements in accordance with generally accepted accounting principles. ( j ) Encumbrances Encumbrances outstanding at year end are reported as reservations of fund balances of the governmental funds since they do not constitute expenditures or liabilities. (k) Fixed Assets - Proprietary Funds Fixed assets owned by proprietary funds are capitalized at historical cost or fair market value at date contributed. Depreciation is charged to operations using a straight-line method based on the estimated useful life of the asset. The estimated useful lives of the assets are as follows: bildings Structures and improvements Sewer, sewer lines and wells Equipment Wells, reservoirs and dams Transmission and distribution Filters and pumps Fire hydrants 10-25 years 50 years 40 years 4-10 years 10-100 years lines 40-70 years 10-50 years 50 years (1) Unbilled Service Receivables Unbilled service receivables in proprietary funds are reflected in accounts receivables at year end with a corresponding increase in revenues. 27 I I I I I I 1 I I I I I I I I 1 I 1 I CITY OF CMLSBAD I I I I I I I I I I I I I I I I I I iil Notes to Combined Financial Statement, Cont inued (m) Investment in Sewer Facility The City has an ownership of approximately 25% in a joint sewer system known as the Encina Water Pollution Control Facility (the Facility). The City accounts for such investment on a cost basis as it does not have significant influence over the management or the operations of the Facility. The Facilit) charges the City usage fees on a cost- reinbursement basis; such charges totaled $564,570 and are classified as Professional Services expense. ( n) Deferred Revenue The deferred revenue balances of the Enterprise Fund relate to deposits or in-kind pre-payments for services to be rendered (e.g., sewer installation, etc.) . ( 2) Account ina Chanaes Effective 3uly 1, 1983, the. City changed its method of accounting for compensated absences in conformance with NCGA statement 4. The accrual for compensated absences at June 30, 1984 totals $532,679. (3) Prior Period Adjustments General Fund and Capital Project Fund In prior years, the City had not recorded interest on advances from the General Fund to the Redevelopment Project (Capital Projects Fund). The effect on beginning fund balance is $62,240. Sewer Enterprise Fund Retained Earnings Cap it a1 Cont r i but ed During the fiscal year ended &ne 30, 1982, the City recorded a non-monetary exchange of future sewer installation credits for a sewage treatment facility as an increase. to contributed capital instead of deferred revenue [see note (1) (dl. $ 131,385 $ (2,604,423) In prior years, the City recorded ( 100,27 8) 100,278 depreciation expense as a reduction of contributed capital. Net prior period adjustment '31,107 $( 2,504,145) 28 CITY OF CPRLSBAD Notes to Combined Financid Statement. Continued - Internal Service Fund In the prior year, the City recorded depreciation expense related to the Central Garage Internal Service Fund as a reduction of Contributed Capital. Debt Service Funds Bui 1 ding Author it y In the prior year, the $36,000 City had improperlk recorded - amounts related to deferred revenue direct to fund balance Contributed Caoi t a1 $147,523 Par king Fund Authority Balance $78,100 $1 14,100 - (4) Seament Information for Enterorise Funds The City maintains two Enterprise funds which provide water and sewer service;. Segment information follom: Operating revenues . Depreciation and amortization Operating income or (loss) Net income Current cap it al: Property, plant and equipment expenses Cont r i but ions ( at cost) : Additions Delet ions Net working capital Bonds payable from operating revenues Total Assets Total Equity for the year eked 3une 30, 1984 was as ~~~ ~ Water Fund $ 1,414,332 137,506 (142,841) 58,516 2,423,080 . 11,270 93,588 2,881,845 894,596 8,440,713 6,83 3,047 Tot al Sewer Enterprise Fund Funds $ 2,984,328 $ 4,398,660 118,744 256,250 1,842,867 1,700,026 1,988,310 2,046,826 16,389,407 18,812,487 25,465 36,735 --- 93,588 3,045,226 5,927,071 --- 994,596 22,2 I 1 ,4 48 30,6 52,16 I 19,632,455 26,465,502 29 I I I 1 I I I 1 1 I I I I I 1 I I I I I I I I I I I I I I I I I I I I CITY OF CARLSBAO Notes to Combined Financial Statements, Continued Cash and Investments A summary of cash and investments as of 3une 30, 1984 follows: Interest Rates cost Cash --- $ 761,653 Certificates of Deposit 9.75 - 12.50% 16,154,687 Miscellaneous Investments 9.20 - 9.70% 4,843,953 Banker's Acceptance Notes 10.97 - 11.90% 5,828,126 Federal Agency Notes 9.30 - 11.35% 1,264,544 $28,852,963 Fixed Assets A summary of changes in general fixed assets' follows: Balance 3uly 1, 1983 Land $ 5,628,455 Buildings 3,241,767 Other Improvements 6,249,276 furniture and Equipment 1,443,159 TOTAL $ 16,562,657 Delet ions Transfer To Internal Sewer Other Balance Additions Service Fund Ent. Fund Deductions &ne 30, 1984 $ 28,227 $ 5,656,682 139,359 3,381,126 1,725,351 7,974,627 332,451 $ 6,439 $ 12,727 $ 271,892 1,484,552 $ 6,439 $ 12,727 $ 271,892 $ 18,496,987 - - P - $2,225,388 A summary of Proprietary Fund property, plant and equipment at June 30, Land, water rights, rights of way Buildings Structures and improvements Wells, reservoirs and dams Transmission and distri- Transmission and distribution lines Sewer, sewer lines and wells Purification, pumps and Fire hydrants Equipment and vehicles Fire protection services Construction in progress TOTAL Less Accumulated Depreciation TOTAL booster stations Total Enterwise Funds $ 459,206 37,964 1,289,853 37,948 4,022,304 4,420,783 147,349 364,969 588,938 5,759 2,676,618 14.051.691 (3; 51 8; 953) $ 10,532,738 Total Total Internal Pr OD r iet ary Service Funds Funds --- 459,206 --- 37,964 --- 1,289,853 --- 37,948 --- 4,022,304 --- 4,420,783 --- 147,349 --- 364,969 $ 1,350,218 1,939,156 --- 5,759 --- 2,676,618 1,350,218 15,401,909 $ 588,561 $1 1,121,299 (761,657) (4,280,610) -3- 30 CITY OF CARLSBAD Notes to Combined Financial Statements, Continued (7) Long-Term Debt A summary of Revenue Bonds Payable - Proprietary (Water Enterprise) Fund is as follows: Balance 3une 30, 1984 1958 Waterworks Revenue Bonds, principal due in amounts ranging from $40,000 to 47,000 on 3uly 1 of each year through 1988 (Interest is payable on 3anuary 1 and 3uly 1 at each year at varying rates from 4.25% to 4.10%) $ 217,000 1960 Waterworks Revenue Bonds, principal due in amounts ranging from $10,000 to 65,000 on 3uly 1 of each year through 1990 (Interest is payable on 3anuary 1 and 3uly 1 at each year at varying rates from 4.25% to 3.875%) 1970 Waterworks Revenue Bonds, principal due in amounts ranging from $75,000 to $100,000 on July 1 of each year through 1990 (Interest is payable on 3anuary 1 and 3uly 1 at each year at varying rates from 6.0% to 6.9%) 625,000 Total revenue bonds payable 1,027,000 185,000 Less unamortized discount Less current portion Total (7,404) ( 125,000) $' 894,596 Principal maturities on the Revenue Bonds Payable as of 3une 30, 1984 are as f 0l.lows : Fiscal Year 1984-85 $ 125,000 1985-86 130,000 1986-87 140,000 1987-88 150,000 1988-89 157,000 Thereafter 325,000 TOTAL $1,027,000 A summary of changes in general long-term debt (serviced by the City's Debt Service Fund) of the City is as follows: Balance Balance 3uly 1, 1983 Additions Payments &ne 30, 1984 1962 Series A General Obligation Sewer Bonds, principal due in amounts ranging from $40,000 to $50,000 on 3uly 1 of each year through 1988 (Interest is payable on 3anuary 1 and 3uly 1 at 3.5% per annum) $ 210,000 --- --- $ 210,000 31 I 1 1 1 1 I 1 I I I I I I I 1 I I I I I I I- D I I I I I I I I I I I I I I I CITY OF CARLSBAD Notes to Combined Financial Statements, Continued Balance Balance 3uly 1, 1983 Additions Payments &ne 30, 1984 1962 Series B General Obligation Sewer Bonds, principal due in amounts ranging from $40,000 to $100,000 on July 1 of each year through 1991 (Interest is payable on January 1 and 3uly 1 at rates varying from 1962 Series C General Obligation Sewer Bonds, principal due in amounts ranging from $20,000 to $25,000 on July 1 of each year through 1991 (Interest is payable on 3anuary 1 and 3uly 1 at rates varying from 3.6% to 3.75%) 185,000 Bonds, principal due in amounts ranging from $15,000 to $25,000 on 3uly 1 of each year through 1992 (Interest is payable on 3anuary 1 and 3uly 1 at 4.5% per annum) 15 5,000 1967 Carlsbad Building Authority Revenue Bonds, principal due in amounts ranging from $20,000 to $35,000 on December 15 of each year through 1993 (Interest is payable on December 15 at 5.25% per annum) 260,000 1969 Carlsbad Parking Authority Revenue Bonds, principal due in amounts ranging from $50,000 to $125,000 on October 1 of each year through 1996 (Interest is payable on October 1 and April 1 at rates varying from 6.0% to 6.4%) 1 , 125,000 1981 Carlsbad Parking Authority Revenue Bonds, principal due in amounts ranging from $40,000 to $150,000 on February 1 of each year through 2001 (Interest is payable on August 1 and 3.5% to 3.6%) $ 480,000 1966 Library General Obligation February 1 at-8% per annum) 1,500,000 TOTAL $3.915 .OOO 32 - -- $ 480,000 185,000 --- $ 15,000 140,000 29,000 240,000 50,000 1,075,000 30,000 1,470,000 $1 15.000 $3,800,000 I CITY OF CARLSBAD Notes to Combined Financial Statements, Continued Debt Service requirements to maturity: Fiscal Year 1984-85 1985-86 19 86- 87 1987-88 1988-89 TOTAL Fiscal Year - 1984-85 1985-86 19 86- 87 1987-88 1988-89 19 89 -90 1990-91 1991-92 TOTAL Fiscal Year - 1984-85 1985-86 19 86-87 19 87-88 19 88-89 1989-90 1 990 - 9 1 1991 -92 TOTAL Schedule of 1962 General Obligation Sewer Bonds, Series A, Debt Service to Maturity Interest Interest Tot a1 Principal Due 3uly 1 Due 3anuary 1 Interest Due 3uly 1 $ 3,675 $ 2,975 2,975 2.275 2;275 1,575 1;575 8 75 875 -0- $ 11,375 $ 7,700 Schedule of 1962 Sewer Bonds, Series 8, Interest Interest Due 3uly 1 Due 3anuary 1 $ 8,580 7,880 7,180 6,480 5,760 5,040 3,420 1,800 $ 46,140 $ 7,880 7,180 6 ,.UO 5,760 5,040 3,420 1,800 -0- $ 37,560 - Schedule of 1962 Sewer Bonds, Series C, Interest Inters t Due 3uly 1 Due 3anuary 1 $ 3,437 3,078 2,707 2,338 1,875 1,406 937 469 $ 16,247 $ 3,078 2,707 2,338 1,875 1,406 938 469 -0- $ 12,811 - $ 6,650 $ 40,000 5,250 40,000 3,850 40,000 2,450 40,000 875 50,000 $ 19,075 $ 210,000 g - General Obligation Debt Service to Maturity Tot a1 Principal Interest Due 3uly 1 $ 16,460 15,060 13,660 12,240 10,800 8,460 5,220 1,800 $ 83,700 $ 40,000 40,000 40,000 40,000 40,000 90,000 90,000 100,000 $ 480,000 General Obligation Debt Service to Maturity Tot a1 Principal Interest Due 3uly 1 $ 6,515 5,785 5,045 4,213 3,281 2,344 1,406 469 $ 29,058 - $ 20,000 20,000 20,000 25,000 25,000 25,000 25,000 25,000 $ 185,000 .- Tot a1 Annual Debt Service $ 46,650 45,250 43,850 42,450 50,875 $ 229,075 Total Annual Debt Service $ ‘56,460 55,060 53,660 52,240 50,800 98,460 95,220 101,800 $ 563,700 Total Annual Debt Service $ 26,515 25,785 25,045 29,213 28,281 27,344 26,406 25,469 $ 214,058 I I I I I I I I I I I I I I 1 I 33 I I k I I I I I I I I I I I I I I I I CITY OF CARLSBAD Notes to Combined Financial Statements, Cont hued Schedule of 1966 General Obligation Library Bonds, Debt Service to Maturity Fiscal Year - 19 84- 85 1985-86 1986-87 1987-88 1988-89 1989-90 1990- 9 1 1991 -92 TOTAL Fiscal Year 1984-85 19 85-86 1986-87 1987-88 1988-89 1989-90 1990-91 1991-92 1992-93 TOTAL Interest Interest Total Principal Total Annual Due 3uly 1 Due 3anuary 1 Interest Due July 1 Debt Service $ 3,150 2,812 2,475 2,138 1,800 1,462 1,013 562 $ 15,412 - $ 3,150 2,812 2,475 2,138 1,800 1,462 1,013 562 $ 15,412 - $ 6,300 5,624 4,950 4,276 3,600 2,924 2,026 1,124 $ 30,824 - $ 15,000 15,000 15,000 15,000 15,000 20,000 20,000 25,000 $ 140,000 $ 21,300 20,624 19,950 19,276 18,600 22,924 22,026 26,124 $ 170,824 Schedule of 1967 Revenue Bonds Carlsbad Building Authority, Debt Service to Maturity . Interest Due Principal Due Total Annual December 15 December 15 Debt Service $ 12,600 11,550 10,237 8,925 7,612 6,300 4,987 3,412 1,837 $ 67,460 34 $ 20,000 25,000 25,000 25,000 25,000 25,000 30,000 30,000 35,000 $ 240,000 $ 32,600 36,550 35,237 33,925 32,612 31,300 34,987 33,412 36,837 $ 307,460 - CITY OF CARLSBAD Notes to Combined Financial Statements, Continued Schedule of 1969 Revenue Bonds I Carlsbad Parking Authority, Debt Service to Maturity Fiscal Tot a1 Pr i ricipal Total Annual Year - 1 9 84 - 85 1985-86 1986-87 1987-88 1988-89 1989-90 1990-91 1991-92 1992-93 1 9 93 - 94 1994- 95 19 95- 96 Fiscal Year 1984-85 1985-86 1986-87 1987-88 1988-89 1989-90 1990-91 199 1-92 1992-93 1993-94 1 9 94- 95 19 95 -96 19 96- 97 1997-98 1998-99 1999-00 2000-01 Interest Due October 1 Debt Service $ 136,925 130,675 121,225 11 1,775 102,250 92,725 83,200 70,400 57,600 44,800 32,000 16,000 $ 999,575 $ 50,000 75,000 75,000 75,000 75,000 75,000 100,000 100,000 100,000 100,000 125,000 125,000 $ 1,075,000 $ 186,925 205,675 196,225 186,775 177,250 167,725 183,200 170,400 157,600 144,800 157,000 141,000 $ 2,074,575 Schedule of 1981 Revenue Bonds Carlsbad Parking Authority, Debt Service to Maturity , Total Pr i ncival Total Annual Interest Due Februarv 1 $ 117,600 114,400 1 10,400 106,400 101,600 96,800 92,000 86,000 80,000 74,000 66,000 58,000 50,000 42,000 32,000 22,000 12,000 $ 1,261,200 $ 40,000 50,000 50,000 60,000 60,000 60,000 75,000 75,000 75,000 100,000 100,000 100,000 100,000 125,000 125,000 125,000 150,000 $ 1,470,000 Debt Service $ 157,600 164,400 160,400 166,400 161,600 156,800 167,000 161,000 15 5,000 174,000 166,000 158,000 150,000 167,000 157,000 147,000 162,000 $ 2,731,200 I I I I 1 I 1 II I I I I 35 I I t I I I I I I I I I I I I I I I I CITY OF CARLSBAD Notes to Combined Financial Statements, Continued 36 __ (8) Obligations Under Capital Leases In 1981 the City entered into an agreement with the City of Oceanside to lease the public parking area surrounding a regional shopping area. the terms of the agreement, the City of Carlsbad agreed to pay an aggregate amount of $700,040 including interest of 10%. interest payments are to be $70,000 through 1991 and $1 annually for each of the remaining years of a fifty year lease. The City's leasehold interest of $430,152 has been recorded in the City's general fixed assets. Under The annual principal and In 1978 the City participated with the City of Oceanside for purchase of an automated circulation system for their respective libraries. leasehold interest of $102,025 is recorded in general fixed assets. lease purchase requires annual payments of principal of $15,845 through 1986 with interest at 5 1/2 X per annum. The City's The In 1981 the City entered into leases for use of certain data processing and word processing equipment. The City's leasehold interests of $123,295 and $72,790 for data processing and word processing equipment, respectively, have been recorded in the general fixed asset group of accounts. The lease agreement for data processing equipment requires payments of principal and interest at 10% per annum of $31,176 per year through February 1987. lease agreement for word processing equipment requires payments of principal and interest at 10% of $18,564 per year through March 1986. The The following is a summary by years of future minimum lease payments under capital leases (paid from the general fund) with the present value of minimum lease payments at 3une 30, 1984: Year Ending 3une 30 Total Lease Payments 1985 $1 32,500 1986 125,813 1987 101,464 1988 70,000 1989 70,000 Thereafter 140,000 639,7 77 Total minimum lease payments Less amount representing interest 166,179 Present value of minimum lease payments $473,598 CITY OF CARLSRAD Notes to Combined Financial Statements, Continued (9) Retirement Plan The City is a participant in the Public Employees Retirement System (PERS) of the State of California covering all the City's permanent employees. The total pension expense of the City for the current year was $1,450,009 for current and past service costs. expenditures when paid and are funded by monthly contributions from the City and employees to PERS. Contributions are based on rates set by PERS based on certain actuarial assumptions, such as length of employment, estimated salary rates, mortality rates, projected retirement benefits and other factors. The actuarial cost method used is entry age normal. At 3une 30, 1983, the plan net assets attributed to the City for benefits totaled $10,741,893 and the present value of the City's unfunded obligation for prior service costs totaled $23,245 which will be funded through the year 2000 from established contribution rates. The excess, if any, of the actuarially computed value of vested benefits to City employees over amounts available in the PERS pension fund is not determinable under the PERS system of accounting. I I I Pension costs are recorded as (IO) Excess of Expenditures over Appropriations Expenditures exceeded appropriations in the following funds: Excess of Expenditures Appropriations Expenditures Over Appropriations Special Revenue Funds: Housing Authority - Section 8 $ 789,982 $ 825,236 $ 35,254 Library A.V. Ins. --- 10,500 10,500 Capital Funds: Redevelopment 132,411 145,905 13,494 (11) Fund Balances/Retained Earnings The following is a summary of reserved and unreserved fund balances and retained earnings: I 1 I II I I I 1 i I 37 CITY OF CARLSBAD Notes to Combined Financial Statements, Continued I Totals I I I I I I I I I I I I I I I Po Governmental Fund Types (Memorandum Only) Special Debt Capital June 30. June 30, General Fund balances: Reserved for prepaid expenses $ 43,500 Reserved for encumbrance 280,518 Reserved for inventory supplies 7,588 Reserved for advances to other funds 4,181 Reserved for low and . moderate income housing -- - Reserved for debt service --- Reserved for payment of principal and interest --- Reserved for working capital --- Reserved for advances to Carlsbad Redevelopment Agency 569,766 Reserved for repayment of advances -- - Designated for approved capital projects --- Undesignated --- HUD Equities --- Unreserved: Revenue --- $1,229,326 35,951 -- - 3,306,948 ( 148,111 ) 55,360 Projects 1984 --- $ 43,500 $ 645,584 2,155,428 --- 7,588 135,198 139,379 --- 499,156 -- 4,500 --- 569,766 5,952,774 9,259,722 4,489,051 5,254,384 --- 55,360 1983 $ 93,945 783? 113 7 I 438 12,544 14,005 956,422 501,919 4,500 361,622 56,020 8,179,741 829,712 70,691 Total Fund Balances $ 905,553 $4,479,474 $1,582,034 $11,222,607 $18,189,668 $11,871,672 -> i 4-p Totals Proprietary Fund Types (Memorandum only) Internal %ne 30, June 30, Enterprise Service 1984 1983 Retained Earnings (Deficit) : Reserved for construction $ 727,075 --- $ 727,075 $ 678,590 Reserved for debt service 887,441 --- 88 7,441 887,441 Unreserved 5,221,483 (383,675) 4,837,808 3,114,065 Designated for approved capital projects 817,016 --- 817,016 825,213 Total Retained Earnings (Deficit) $ 7,653,015 $(349,717) S7,303,298 $5,505,309 Reserved for claims -- - $ 33,958 33,958 --- -- -- - 38 CITY OF CPRLSBAD Notes to Combined Financial Statements, Continued The following funds reported deficits in their respective fund balances at 3une 30, 1984: Redevelopment project (Capital Project Fund) General liability self-insurance (Internal Central garage (Internal Service Fund) Service Fund) Amount of Deficit to Fund Balance $ 425,929 309,152 49,603 ( 12) Changes in Contributed Capital Enterprise Funds Water Sewer Utility Enterprise Total - Contributed capital, balance at beginning Prior period adjustments, net (see Beginning balance, as restated $2,423,086 F ixed as set cont r i but ions --- Contributed capital, balance at end of year $2,423,080 $18,880,825 $21,303,905 footnote 3) (2,504,145) (2,504,145) 16,376,680 18,799,760 12,727 of year $2,423,080 $16,389,407 $18,812,487 Internal Service Funds 12,727 ' z-ra - Workers General Central Compensation Liability Garage Total Contrubited capital, balance at Prior period adjustments (see beginning of year $500,000 $700,000 $591,494 $1,791,494 --- 147,523 147,523 Beginning balance, as restated 500,000 700,000 739,017 1,939,017 footnote 3j --- .150;000 Cash contributions --- 150;OOO --- Fixed asset contributions --- 6,439 6; 439 Contributed caDital. balance at end of year $850,000 $745,456 $2,095,456 -- - - $500,000 (13) Deferred Compensation Plan The City has established a deferred compensation plan whereby City employ- ees may elect to defer portions of their compensation in return for retire- ment, disability and death benefits. lesser of $7,500 or 25% of a participant's "includable compensation", as defined in the participation agreement. The City makes no contribution to the plan. Plan assets were invested in a combination of deferred Amounts deferred may not exceed the I 1 I 1 I I I I 1 R I I I I I 1 39 1 1 CITY OF CARLSBAD I Notes to Combined Financial Statements, Continued compensation options including short-term certificates of deposit, bond funds, stock funds, and government securities. At 3une 30, 1984, the amount of the deferred compensation investments (and the resulting liability recorded in the Agency Fund) was $324,443. made upon the occurrence of the participant's termination, retirement, death or total disability, and in a manner in accordance with the election made by the participant. All City employees are eligible for plan participation . t-- I I Distributions are ( 14) Contingencies (a) The Water Utility Fund of the City and Costa Real Municipal Water District (the "District") are currently providing water services to most of the City under the terms of a basis of understanding negotiated in an effort to settle a law suit between the parties. Such understanding provides for a functional allocation of responsibilities between the Water Utility Fund and the District with several significant issues to be resolved by 3oint Committee of the parties before a final comprehensive agreement is reached. As a result of a final agreement, additional assets and/or liabilities may be transferred among the parties. In October 1983, the City of Carlsbad issued $20,000,000 of revenue bonds to provide funds for purchase of loans collateralized by first lien deeds of trust on single-family residences , including townhouses and condominium units within the City. broadening affordable housing opportunities in the City of Carlsbad. I I I (b) This activity is aimed at I I I I I The bonds are payable solely from payments made on the acquired loans. The bonds are collateralized by the loans and related first lien deeds of trust (and any insurance payments with respect thereto) and certain reserve funds and other moneys in connection therewith (including investment income earned thereon). It is the City's opinion that these bonds are not payable from any other revenues or assets of' the City of Carlsbad, and neither the faith and credit nor the taxing power of the City, the State of California or any political subdivision thereof is pledged to the payment of the principal or redemption price of or interest on the bonds. Consequently, the transactions of these revenue bond programs are not included in the financial statements of the various funds and account groups of the City of Carlsbad. (c) The City is a defendant in certain legal actions arising in the normal course of operations. In the opinion of management and legal counsel, any liability resulting from these actions will not result in a material adverse effect on the City's financial position. 1 I 40 CITY OF CARLSBAD Notes to Combined Financial Statements, Continued (15) Advances To and From Other Funds Advances to other funds Advances from other funds Fund Amount Fund Amount $ 4,180 Ge nerd 1 $5 73,946 Street Lighting - - - (Special Revenue Fund) Redevelopment Project 569,766 TOTAL $5 73,946 (Capital Project Fund) - 41 I I I I I I sl I I I t I I I I I Supplemental Data 42 CITY OF CARLSBAD General Fund Schedule of Revenues Year ended %ne 30, 1984 ~__ Taxes: Property taxes Property tax reimbursements Sales and use taxes Transient lodging taxes Franchise taxes Real property transfer taxes Cigarette taxes Trailer coach in-lieu tax Total taxes Licenses and permits: Vehicle licenses (in-lieu) Construct ion permits Business licenses License tax on new construction Other Total licenses and permits Intergovernmental: Grants Total intergovernmental Charges for services: Zoning and subdivision fees Sales of maps and publications Plan checking fees Engineering fees Library and parks 8 rec fees Police service fees Ambulance fees Refuse collection fees City property damage Environment a1 impact studies Other Total charges for services Fines and forfeits: Vehicle code fines Other Total fines and forfeits Interest income Miscellaneous: Reinbursed expenditures Sale of property Rent s Other Tot a1 miscellaneous Total Revenues kdget $ 4,264,000 160,000 4,700,000 810,000 400,000 100,000 40,000 10,474,000 --e 800,000 290,000 500,000 1,590,000 --- - -- 80,000 20,000 675,000 300,000 276,800 50,000 30,000 --- --- 10,000 7,500 1,449,300 265,000 265,000 700,000 20,000 5,000 5,000 48 000 $1 4,5 56,300 --- -Rfixm IC- & 43 Actual $ 4,391,609 275,137 4,891,379 1,007,268 466,102 198,808 139,829 22,203 11,392,335 46,655 1,068,876 351,875 983,789 622 2,451,817 2,491 2,491 160,449 28,721 1,005,286 424,055 376,757 12,310 69,155 10,282 21,087 21,650 52,515 2,182,267 25 5,453 1,018 256,471 565,281 34,430 4,204 7,860 8 871 $16,906,027 ~ ----Tfm - Variance F avo rab le (Unfavorable) $ 127,609 115,137 191,379 197,268 66,102 98,808 139,829 ( 17,797) 91 8,335 46,655 268,876 61,875 483,789 622 861,817 2,491 2,491 80,449 8,721 330,286 124,055 99,95 7 12,310 19,155 (19,718) 21,087 11,650 45,015 732,967 ( 9,547 1 1 018 (134,719) 14,430 (7%) 2,860 (39 129) ,(a,529) -7&m $2,349,727 CITY OF CARLSBAD General Fund I Schedule of Expenditures Year ended &ne 30, 1984 I I I I I I I I I I I I I I I 1 General government: City Council City Manager City Clerk Research /Analysis Group City Attorney Finance City Treasurer Central Services Data Processing Purchasing Insurance Personnel Planning Community pr omot ion Senior Citizens programs Commun it y Assi st ance Weed abatement Contingencies Capital improvements Bu i 1 di ng ma in t e n anc e Leases Other Total general government Public safety: Fire protect ion Police protection Building inspection Civil Defense Total public safety Public works: Ah in i s t r a t ion Engineering Streets Maintenance Building Maintenance Total public works Culture and recreation: Parks and recreation Library Total culture and recreation Total Expenditures Ehdget $ 93,509 219,091 10,443 229,235 155,829 265,821 4,018 367,537 156,325 80,361 68,046 186,167 391,624 45,000 37,825 17,100 45,723 28,232 21,263 283,585 70,000 48,295 2,825,029 2,296,744 3,27 7,27 2 7,165 6,042,943 35,315 842,266 1,204,042 106,748 40,573 2,228,944 1,654,354 1 ,132,114 2,786,468 $ 13,883,384 461,762 44 Actual $ 89,559 214,189 7,045 199,28 1 152,771 2 17,476 3,756 371,007 141,734 77,840 62,424 190,368 390,277 46,758 37,825 17,100 41,952 1,437 13,540 149,140 70,755 38,634 2,534,868 2,221,626 3,049,646 537 , 646 4,533 5,813,451 30,068 716,513 1,068,367 51,684 40,784 1,907,416 1,590,203 1,037,104 2,627,307 $1 2,8 83,042 Var i ance Favor ab le (Unfavorable) $ 3,950 4,902 3,398 29,954 3,058 48,345 262 (3,4701 14,591 2,521 5,622 (4,201) 1,347 (1,758) --e --- 3,771 26,795 134,445 (755) 966 1 290,161 7,723 75,118 227,626 2,632 229,492 ( 75 , 884 5,247 125,753 135,675 55,064 (211) 321,528 64,151 95,010 159,161 $1,000,342 I I CITY OF CARLSBAD Special Revenue Funds Combining Balance Sheet 3une 30, 1984 Library Audio Visual In sur ance Federal State Gas Tax Grants Grants Street Lightina Assets ish and investments $1,006,986 $ 782 $ 660,989 ?ce i va bles : Taxes -- - --- -- - Accounts -- - -- - --- Accrued interest -- - --- 5,827 le from other governments --- --- --- *epaid expenses ---- --- --- Total assets $1,006,986 $ 782 $ 666,816 -- Liabilities and Fund Balances $ 362,895 $ 8,886 I 1 I I $ 380,170 - $ 8,886 abilities: ints payable $ 52,239 <tred wages payable --- dvance from General Fund --- Due to other funds -- - Advances from other funds --- Advances from other governments --- Prepaid annual contributions --- $ 27,273 1,552 4,180 --- Total liabilities 52 , 239 --- 4,649 nd balances (deficit ) : Reserved for Reserved for Low and Unreserved: Designated for approved capital projects 694,958 --- 1,697,224 Undesignated (158,954) $ 782 (1,042,384) HUD fund equities --- --- --- encumbrances 41 8,743 --- 7,327 Moderate Income Housing --a -- - --- Total fund balances (deficit) 954,747 782 662,167 2,210 --- I I I I 1 344,955 $ 8,886 347,165 8,886 Total liabilities and fund balances $1,006,986 $ 782 $ 666,816 -a 1_1 $ 380,170 $ 8,886 45 I I I I I I I I I I I I I I I I I I I Low and Moderate Income Housing $ 35,951 - -- --- --- --- --- Section 8 Housing Authority $ 119,657 --- 12 48,926 59,798 $ 228,393 --- Totals 3une 30, 3une 30, Community Development Block Grant Revenue Sharinq 1984 1983 $2,470,736 $ 63,771 $ 4,730,653 $ 4,885,714 17,275 12 5,827 48,926 59,798 12,291 173,646 60,961 38,817 56,005 $ 5,227,434 $ 35,951 $ 63,771 $ 4,862,491 - $2,470,736 L- a $ 205,812 3,014 4,180 $ 403,432 2,806 98,583 12,544 --- $ 800 1,462 --- --- --- 98,940 71,071 172,273 760 --- --- --- 55,360 56,120 $ 228,393 P --- 98,940 87,199 71,071 . 63,966 668,530 --- 120.842 383,017 9 1,229,326 35,951 483,414 529,966 270,320 --- 388,178 (715,569) --- 14,005 526,583 1,414,178 --- 3,306,943 55,360 (148,111) 4,440,155 (449,361 70,691 ( 57,071 1 4,479,474 4,558,904 35,951 $ 35,951 - 2,470,727 $2,470,736 $ 4,862,491 $ 5,227,434 $ 63,771 46 CITY OF CARLSBAO Special Revenue Funds I Combining Statement of Hevenues, txpenditures and Changes in Fund Balances Year ended 3une 30, 1984 Li brary Audi o Visual Insurance I Federal Grants State Grants Street Li qhti ng Gas Tax Revenues : Taxes $ 521,624 Interest i ncome 130,553 Other 12,637 Intergovernmental --- $ 521,894 27,650 --- $ 200,158 66,275 --- Total revenues 64 - 664,8 14 266,433 19,386 1 549,544 Expenditures: General government --- Public works 45 3,494 Culture and recreation --- Capital projects --- Welt are --- Total expenditures 453,494 Excess (def I ciency ot revenues over expenditures 21 1,320 Fund balances (deficit) at beginning of year as previously reported 1,286,427 Prior period adjustment --- ii ,850 602,794 126,314 444,864 10.500 740,958 444,864 --- I I 1 64 104.680 (474,525) --- --- 1 718 --- 1,136,692 --- 242,485 --- Fund balances (deficit) at beg. of year as adjusted 1,286,427 Resi dual equity transfers in (out) ( 543, OOO) at end of year $ 954,747 Fund balances (def kit) 718 1,136,692 242,485 --- --- I $ 782 - $ 662,167 $ 347,165 47 I I I I I I I I I I I I I I I I I I 101 Revenue Sharing - -- $ 454,074 185,550 --- Section 8 Housing Authority --- $ 796,207 13,698 --- Community Development Block Grant --- $ 324,657 6,308 --- 108,870 530,754 1,939,973 --- 1,939,973 --- - ~~ $2,470,727 809,905 --- --- --- --- 825,236 825,236 ( 15,331 1 71,451 --- 71,451 --- $ 56,120 Low and Income 3une 30, 3une 30, Moderate Totals Housing 1984 $ 19,795 $ 1,063,313 255,189 75,776 ( 132,847) --- 21,946 14,005 --- (132,847) --- 14,005 --- $ (57,071) 48 1 ;775,O96 451,635 12,637 3,302,681 11,850 1,501,152 136,814 364,059 825,236 2,839,111 463,570 4,5 58,904 --- 4,5 58,904 ( 543,000) $ 35,951 $ 4,479,474 - 1983 $ 885,581 2,545,519 371,763 --- 3,802,863 33,197 1,028,030 26,559 724,764 727,155 2,539,705 1,263,158 3,165,120 130,626 3,295,746 --- $4,558,904 CITY OF CARLSBAD Special Revenue Fund Types Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual Revenues : Taxes Interest income Other Year ended June 30, 1984 Total Revenues Expenditures: Public Works Total Expenditures Excess (deficiency) of revenues over expenditures Fund balance at beginning of year Residual equity transfers in (out) Fund balance at end of year Budget $ 483,544 60,000 --- ~~ 543,544 1,148,452 1,148,452 (604,908) 1,286,427 ( 543,000 ) $ 138,519 49 Actual $ 521,624 130,553 12,637 664.01 4 453,494 453,494 211,320 1,286,427 ( 543,000) Gas Tax Fund Variance $ 954,747 favorable (unfavorable) $ 38,080 70,553 12,637 121,270 694.958 694,958 816,228 $ 816,228 I k- I I I I I I CITY OF CARLSBAD Special Revenue Fund Types Statement of Revenues, Expenditures, and Changes in e. tuna uaiances - uudget and A ctuai Year ended 3une 30, 1984 Federal Grants Revenues: Interest income - ___ __ -~ Variance favorable Budget Actual (unfavorable) --- 64 64 - Total Revenues Expenditures: Culture and recreation Capital projects Total Expenditures Excess of revenues over expenditures Fund balance at beginning of year Fund balance at end of year I --- 64 64 - $ 718 - 718 $ 718 $ 782 ' - - 64 - $ I I I I I I I I I 50 CITY OF CPRLSBAD Special Revenue Fund Types Statement of Revenues, Expenditures, and Changes in Fund Bal ances - Budget and Actual Year ended 3une 30, 1984 State Grants Variance - &Idget Intergovernment a1 revenues $ 1,034,470 Interest income --- Revenues: Tot a1 Revenues 1,034,470 Expenditures: General government --- Public Works 2,210,368 Culture and recreation 255,915 lot a1 Expenditures 2,466,283 Excess (deficiency) of revenues over expenditures (1,431,813) Fund balance at beginning of year 1,136,692 Fund balance (deficit) at end of year $ (295,121) 51 Actual $ 200,158 66,275 266,433 11,850 602,794 126,314 740,958 ( 474,525 1 , 1 36,692 $ 662,167 favorable (unfavorable) $ (834,312) 66,275 ( 768,037) (1 1,850) 1,607,574 129,601 1,725,325 957,288 $ 957,288 I I 1 1 I I I 1 1 I 1 I I I I I I CITY OF CARLSBAD Special Revenue Fund Types Statement of Revenues, Expenditures, and Changes in I I I I I I I I I I I I I I I I 1 Revenues : Interest Income Total Revenues Expenditures: Culture and recreation Total Expenditures Excess of revenues over expenditures Year ended June 30, 1984 Library Audio Visual Insurance Variance - favorable Budget Actual (unfavorable) --- $ 19,386 $ 19,386 19,386 19,386 10,500 (IO, 500) --- 10,500 ( IO, 500) -- - 8,886 8,886 Fund balance at beginning of year --- --- Fund balance at end of year 52 $ 8,886 - CITY OF CMLSBAD Special Revenue Fund Types S_tattemenLoCRe~nus&xpencU.u~- in Fund Balances - Budget and Actual Year ended 3une 30, 1984 Revenues : Taxes Interest income Street Lighting Variance - f avorab le f3udget Actual (unfavorable) $ 468,000 $ 521,894 $ 53,894 4,000 27,650 23,650 Total Revenues 472,000 549,544 77,544 Expenditures : Public Works 492,614 444,864 47,750 Total Expenditures 492,614 444,864 47,750 Excess ( deficiency) of revenues (20,6 14) 104,680 125,294 over expenditures fund balance at beginning of year 242,485 242,485 --- fund halance at end of year $ 221,871 $ 347,165 . $125,294 Icp -LI - _____1 53 I I I- I I I I I I 1 I I 1 1 I I I I I CITY OF CARLSBAD Special Revenue Fund Types Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual I I- I I I I I I I I I I I I I I I I Revenues: Intergovernment a1 revenues Interest income Total Revenues Expenditures: Capital projects Year ended &ne 30, 1984 Revenue Sharing Variance - favor able bdget Actual (unfavorable) $ 500,000 $ 454,074 $ (45,926) --- 185,550 185,550 500,000 639,624 139,624 1 ,892,552 1 08,870 1,783,682 Total Expenditures 1 ,892,552 108,870 1,783,682 Excess (deficiency) of revenues over expend i tur ks (1,392,552) 530,754 1,923,306 Fund balance at beginning of year Fund balance at end of year 1,939,973 1,939,973 $ 547,421 $ 2,470,727 ' i 54 $1,923,306 CITY OF CARLSBAD Special Revenue Fund Types Statement of Revenues, Expenditures, and Changes in F&J-e El- 1 Revenues : Intergovernmental revenues Interest income Total Revenues Expenditures: Welfare Total Expenditures Deficiency of revenues over expenditures Fund balances at beginning of year Year ended 3une 30, 1984 Section 8 - Housing Authority Variance - Fund balance at end of year Budget $ 754,850 20,000 774,850 789,982 789,982 (15,132) 71.451 $ 56,319 55 Actual $ 796,207 13,698 809,905 825,236 825,236 (15,331) 71,451 $ 56,120 favorable (unfavorable) $ 41,357 (6,302) 35,055 ( 35,254) ( 35,254) I I I i I 1 1 I I I 1 I I I I I CITY OF CARLSRAD Special Revenue Fund Types Statement of Revenues, Expenditures, and Changes in bund Balances - Budget ana Actual I I- - - Year ended &ne 30, 1984 Community Development Block Grant Variance - favor ab le I I I hdget Actual (unfavorable) Revenues: Intergovernmental revenues $ 325,000 $ 324,657 $ (343) Interest income --- 6,308 6,308 Total Revenues 1 Expenditures: Capital projects 325,000 330,965 5,965 587,323 255,189 332,134 Total Expenditures 587,323 255,189 332,134 Excess (deficiency) of revenues over expenditures (262,323) 75,776 338,099 Deficit at beginning of year ( 132,847) ( 132,847) --- Deficit at end of year il $ (395,170) $ (57,071)' $ 333,099 P I I I I I I I I I 56 I CITY OF CARLSBAO Special Revenue Fund Types Statement of Revenues, Expenditures, and Changes in 1 A Revenues: Taxes Interest Total Revenues Expenditures : Capital projects Tot a1 Expenditures Excess of revenues over expenditures Fund balance at beginning of year Year ended 3une 30, 1984 Low and Moderate Income Housing Variance - favorable &Idget Actual (unfavorable) Fund balance at end of year $ 22,000 $ 19,795 $ (2,205) --- 2,151 2,151 22,000 21,946 (54) 22,000 21,946 (54) 14,005 14,005 --- $ 36,005 $ 35,951 $ (54) - - - 57 I I I I This Page Intentionally Left Blank 58 I CITY OF CMLSBAD Debt Service Funds Assets Cash and investments (Note 5) Taxes receivable Accrued interest receivable 3une 30, 1984 Library Bonds $ 22,868 --a --- Total assets $ 22,868 Liabilities and Fund Balances Liabilities: Accounts payable Due to other funds Total liabilities Fund balance: Reserved for debt service Reserved for payment of bond principal and interest Reserved for working capital Unreserved Total fund balances Total liabilities and fund balances 59 $ 3,150 --- 3,150 19,718 $ 22,868 - Sewer Bonds - $ 159,236 1,942 $ 161,178 --- Parking Authority $ 1,309,301 33,003 $ 1,342,304 $ 15,962 --- 145,216 $ 161,178 $ 446,631 3,000 892,673 1,342,304 $ 1,342,304 I I I I I I I I I I I I I I I I I r I I I I I I I I I Bui 1 ding Authority $ 74,796 $ 52,525 1,500 20,771 74,796 $ 74,796 Totals 3une 30, 3une 30, 1904 1983 $ 1,566,201 $ 1,440,051 --- 2,417 34,945 24,579 $ 1,601,146 $ 1,467,047 $ 19,112 $ 36 5 - -- 3.841 19,112 4,206 164,934 98,380 499,156 501,919 4,500 4,500 913,444 858,042 1,582,034 1,462,841 $ 1,601,146 $ 1,467,047 ..p A - 60 CITY OF CARLSBAD I Debt Service Funds Combining Statement of Revenues, kxpenditures and Changes in Fund Balances Revenues: Taxes Interest income Tot a1 revenues Expenditures : General government Principal retirement Interest and fiscal charges Year ended 3une 30, 1984 Library Bonds $ 2,366 2,366 --- 15,000 6,637 Tot a1 expenditures 21,637 Excess (deficiency) of revenues over expend i tu r es (19,271) Other financing sources (uses): Operating Transfers in(out) Tot a1 other financing sources (uses) --- Excess (deficiency) of revenues and other sources over expend- itures and other uses (19,271) Fund balances at beginning of year Prior period adjustment (Note 3) 38,989 --- Fund balances at beginning of year as adjusted 38,989 Fund balances at end of year 61 $ 19,718 _I_ Sewer Bonds - $ 109,295 7,915 117,210 - -- --- 31,385 31,385 85,825 --- --- 85,825 59,391 --- 59,391 $ 145,216 - Parking Authority $ 120,623 120,623 3,550 BO, 000 190,025 273,575 (152,952) 312,400 312,400 159,448 1,260,956 (78,100) 1,182,856 $1,342,304 I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I Building Authority $ 7,232 7,232 941 15,000 20,000 35,941 (28,709) 36,000 36,000 7,291 103,505 ( 36,000) 67,505 $ 74,796 Totals . -. ___ %ne 30, 3une 30, 1984 1983 $ 109,295 $ 113,940 138,136 141,843 247,431 255,783 4,491 3,175 115,000 185,000 243,047 252,147 362,538 440,322 (115,107) ( 184,539) 348,400 462,500 348,400 462,500 233,293 277,961 1,462,841 1,164,880 (114,100) --- 1,348,741 1,184,880 $ 1,582,034 $1,462,841 62 CITY OF CARLSBAD Debt Sevice Fund Types Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual Revenues: Interest income Total Revenues Expenditures: Debt service expenditures : Principal retirement Interest and fiscal charges Year ended 3une 30, 1984 Library Bonds Variance - hdget $ 4,000 4,000 15,000 6.976 Tot a1 Expenditures Deficiency of revenues Over expenditures Fund balance at beginning of year Fund balance at end of year 21,976 (17,976) 38,989 $ 21,013 63 Actual S 2.366 2,366 15,000 6,637 21,637 ( 19,27 1 38,989 $ 19,718 f avo rab le (unfavorable) $ (1,634) (1,634) --- 339 339 (1,295) 1 I I I I 1 I I I I 1 I 1 I 1 I I CITY OF CARLSEMD Debt Service ' Fund Types Statement of Revenues, Expenditures, and Changes in d Ralances - I Year ended June 30, 1984 I I I I I I I I I I I I I I I I Revenues : Taxes Interest income Total Revenues Expenditures: Debt service expenditures: Principal retirement Interest and fiscal charges Total Expenditures Excess (deficiency ) of revenues over expenditures Fund balance at beginning of year Fund balance at end of year Sewer Bonds Budget $ 100,000 10,000 110,000 --- 31,385 31,385 78,615 59,391 $ 138,006 64 Variance - favorable Actual (unfavorable) $ 109,295 $ 9,295 7,915 (2,085) 117,210 7,210 31,385 --- 31,385 85,825 7,210 59,391 $ 145,216 $107,210 - P CITY OF CARLSBAD Debt Service Fund Types Fund Balances - Budget and Actual Statmmh+Rewmies L” rvpe&Hiwes 9 Year ended 3une 30, 1984 Revenues: Inters t income Parking Authority Variance - favorable Budget Actual (unfavorable) $ 120,623 $ 120,623 $ --- Tot a1 Revenues 120,623 120,623 --- Expend i tu res : General government 3,550 3,550 --- Principal retirement 80,000 80,000 --- Interest and fiscal charges 190,025 190,025 --- Debt service expenditures: Total Expenditures Deficiency of revenues over expenditures Other f inancing sources: Operating Transfers in 273,575 273,575 (152,952) (152,952) --- --- 312,400 31 2,400 Total other financing sources 312,400 3 12,400 --- Excess of revenues and other sources over expenditures and other uses 159,448 159,448 --- Fund balance at beginning of year 1,260,956 1,260,956 --- Prior period adjustment (Note 3) --- ( 78,100) (78,100) Fund balance at the beginning of year Fund balance at end of year 1,260,956 1,182,856 (78,100) $1,420,404 $ 1,342,304 $(78,100) 65 I 1 I I I I I I I 1 I I 1 I I I I I I CITY OF CARLSBAD Debt Service Fund Types Statement of Revenues, Expenditures, and Changes in I I--R=’- - Year ended 3une 30, 1984 I I I I I I I I I I I I I I I 1 Ruilding Authority Variance - favorable (unfavorable) Actual $ 7,232 7,232 Budget $ 7,232 7,232 Revenues : Interest income $ --- Total Revenues --- Expenditures: General government Debt service expenditures: Principal retirement Interest and fiscal charges 941 941 20,000 15.000 20,000 15,000 35,941 (28,709) 36,000 . 36.000 Total Expenditures Deficiency of revenues over expenditures Other finances sources: Operating Transfers in 35,941 ( 28,709) 36 , 000 36,000 --- Total other financing sources --- Excess of revenues and other sources over expenditures and other uses 7.291 7,291 --- Fund balance at beginning of year Prior period adjustment (Note 3) 103,505 103,505 (36,000) (36,000) --- Fund balance at beginning of year as adjusted (36,000) 67,505 $ 74,796 103,505 $ 110,796 Fund balance at end of year $( 36,000) 66 -~ CITY OF CARLSBAD I Capital Projects Funds Combining Balance Sheet 3une 30, 1984 Capital Construct ion Assets Cash and investments (Note 5) Accounts receivable Accrued interest receivable Total assets Liabilities and Fund Balances Liabilities: Accounts payable Accrued wages payable Advances from other funds Total liabilities Fund balances ( deficit) : Reserved for encumbrances Reserved for repayment of advances Unreserved: Designated for approved capital projects Undes ignated Total fund balances (deficit) Total liabiltiies and fund balances ( deficit) ~ ~~ $ 5,655,396 $ 645 645 527 ,907 --- 3,746,178 1,380,666 5,654,751 $ 5,655,396 Public Fail it ies Construct ion $ 4,278,826 300 --- $. 300 117,677 2,131,596 2,029,253 4,278,526 $ 4,278,826 67 1 1 I I I I r I I I I Planned Local Drainage Redevelopment Facilities Project Totals June 30, 3une 30, 1984 1983 Br is t ol Cove Park Development $ 5,471,452 5,068 32,227 $ 5,508,747 $ 50,899 $ 412,560 $ 145,896 $ 11,795,377 --- -- - -- - --- --- --- --- --- $ 50,899 $ 412,560 $ 145,896 $ 11,795,377 - - L- - $ 1,251,800 1 I $ 120 $ 1,065 $ 53 1,939 ' 1,939 714 569,766 569,766 361,622 571,825 572,770 362,389 --- 135,198 645,584 135,198 139,854 56,020 5,952,774 3,739,586 4,489,051 1,210,898 75,000 1,176,800 --- (561,127) 412,560 50,899 41 2.560 50.899 ( 425,929) 11,222,607 5,146,358 1 ,25 1 ,800 $ 1,251,800 $ 50,899 - $ 412,560 $ 145,896 $ 11,795,377 $ 5,508,747 - I I 68 CITY OF CARLSBAD Capital Projects Funds and Changes in Fund Balances C& w-- 9 Eq-2 ? - Revenues : Taxes Charges for services Interest income Miscellaneous Revenue Total revenues Year ended 3une 30, 1984 Capital Construct ion Expenditures : Police and Utility Service Center Police Firing Range Fire Station #5 land aquisition Community Development Center La Costa Canyon Park Street additions and improvements Library addition Storm Drains Longard Tube Redevelopment area project Other construction projects Interest and fiscal charges --- $ 171,043 171,043 47,822 25,080 --- 150,897 --- 100,212 37,032 Total expenditures 361,043 Excess (deficiency ) of revenues over expenditures Other financing sources: ( 190,000) Operating transfer in --- Excess (deficiency) of revenues and other sources over expenditures ( 190,000) Fund balances (deficit) at beginning of year 2,409,206 Prior period adjustment (Note 3) --- Fund balances at beginning of year as adjusted 2,409,206 Residual equity transfers in 3,435 , 545 Fund balances (deficits) at end of year $5,654,75 1 69 Public Facilities Construction $ 2,305,262 251,570 2,556,832 132,254 2,424,578 2,424,578 1,853,948 1,853,948 $4,278,526 t- Planned Loca 1 Drain age Redevelopment Facilities Project Totals 3une 30, 3une 30, Park Bristol Development Cove 1984 1983 --- $ 121,392 29,933 $ 79,179 $ 79,179 $ 56,020 --- 2,565,684 1,038,633 8,639 387,040 185,094 --- 310,243 --- - -9 --- $ 139,030 --- 139,200 --- 92,833 $ 4,065 151,325 87,818 3,342,146 1,279,747 4,065 371,063 96,783 25,080 28,227 --- 37,574 --- e-- --- 7,716 36,541 120,689 88,157 13,867 77,149 126,571 20 I I I I I I I I I I 182,076 23,887 37,032 112,093 100,212 112,093 --- 33,812 33,812 145,905 - 508,284 639,202 (58,087) 2,702,944 771,463 151,325 4,065 371,063 --- ( 58,087) 2,702,944 823,533 (305,602) 5,146,358 4,3 22,825 ( 62,240) (62,240) -5- (367.842) 5.084.118 4.322.825 151,325 261,235 4,065 46,834 371;063 880,737 --- 46,834 --- 261,235 --- 880,737 - -- $1,251,800 $50,899 $ 412,560 $(425,929) $ 11,222,607 $ 5,146,358 70 CITY OF CARLSBAD Capital Projects Fund Types Statement of Revenues, Expenditures, and Changes in Fd-es - Budget and Actual Year ended 3une 30, 1984 Capital Construction Revenues : Miscellaneous revenue Total revenues Expenditures: Capital projects Total expenditures Deficiency of revenues over expenditures Fund balance at beginning of year Residual equity transfers in Fund balance (deficit) at end of year &Idget s --- Actual s 171.043 2,852,775 2,852,775 (2,852,775) 2,409,206 --- $ (443,569) 71 171,043 361,043 361,043 ( 190,000) 2,409,206 3,435,545 $ 5,654,751 Variance - favorable (unfavorable) $ 171,043 171.043 2,491,732 2,491,732 2,662,775 3,435,545 $ 6,098,320 I I 1 I I I I 1 1 I I I I 1 I 1 1 1 I I I I I I I I I I I I I I I I I I I I CITY OF CMLSBAD Capital Projects Fund Types Bateme-- Fund Balances - Budget and Actual Year ended 3une 30, 1984 Public Facilities Construction Variance - Revenues: Charges for services Interest income Budget $ 2,000,000 Total Revenues 2,000,000 Expenditures: Capital projects 2,264,446 Total Expenditures 2,264,446 Excess (deficiency) of revenues ove r ex pend i tu res (264,446 1 Fund balance at beginning of year 1,853,948 Fund balance at end of year $ 1,589,502 Actual $ 2,305,262 251,570 2,556,832 132,254 132,254 2,424,578 1,853,948 $ 4,278,526 f avo rab le (unfavorable) $ 305,262 251,570 556,832 2,132,192 2,132,192 2,689,024 $ 2,689,024 CITY OF CARLSBAD Capital Projects Fund Types -LtilteUwW Fund Balances - Budget and Actual Year ended June 30, 1984 Park Development Variance - Revenues: Charges for services Interest income Miscellaneous revenue Tot a1 Revenues Expenditures: Capital projects Total Expenditures Excess of revenues over expenditures fund balance at beginning of year Fund balance at end of year Budget 3 17.000 --- Actual $ 139,030 92,833 139,200 371,063 --- favor ab le (unfavorable) $ (177,970) 92,83 3 139,200 54,063 317,000 880,737 $1,197,73 73 371,063 880.737 54,063 --- $ 1,251,800 $ 54,063 I I 1 I I I I B 1 I 1 1 I 1 I I I I I I I I- I I I I I I I I I I I I I I I I CITY OF CARLSBAD Capital Projects Fund Types Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual Year ended %ne 30, 1984 Revenues: Interest income Total Revenues Expenditures: Capital projects Total Expenditures Excess of revenues over expenditures Fund balance at beginning of year Fund balance at end of year 74 Bristol Cove Variance - favor ab le &dget Actual (unfavorable) $ --- $ 4,065 $ 4,065 --- 4,065 4,065 --- 4,065 46,834 46,834 4,065 $ 4,065 - $ 46,834 $ 50,899 - - CITY OF CARLSBAD 1 Capital Projects Fund Types Statement of Revenues, Fxp enditures, and Changes in Fund Balances - Budget and Actual I I Year ended 3une 30, 1984 Planned Local Drainage Facility Variance - favorable Budget Actual (unfavorable) Revenues: Charges for services Interest income Tot a1 Revenues . Expenditures: Capital projects Total Expenditures Excess (deficiency) of revenues over expenditures Fund balance at beginning of year Fund balance at end of year $ 180,000 1 80,000 180,000 261,235 $ 441,235 I $ 121,392 $ (58,608) 29,933 29,933 I 151,325 (28,675) 151,325 (28,675) 261,235 --- 7 I $ 412,560 ' $(28,675) - 1 1 I I I I I 1 75 I I I I I I I I I I I I I I I I I I 1 CITY OF CPRLSBAO Capital Projects Fund Types Statement of Revenues! Exp enditures, and Chanaes in Fund Balances - Budget and Actual Year ended &ne 30, 1984 Redevelopment Project Variance - Revenues : Taxes Interest income Total Revenues Expenditures: Capital projects Debt serv ice expend1 tu res : Interest and fiscal charges Total Expenditures Deficiency of revenues Over expenditures Fund deficit at beginning of year Prior period adjustment (Note 3) Fund deficit at beginning of year as adjusted Fund deficit at end of year &Idget $ 88,000 --- 88.000 132,411 --- 132,411 (44,411) (305,602) ( 305,602) $ (350,013) 76 Actual $ 79,179 8,639 87,818 112,093 33,812 145,905 ( 58,087) (305,602) ' ( 62,240) ( 367,842) $ (425,929) favorable (unfavorable) $ (8,821) 8,639 ( 182) 20,318 ( 33,812) (13,494) (13,676) ( 62 , 240) ( 62,240) $ (75,916) CITY OF CARLSBAD Enterprise Funds Combininq Balance Sheet June 30, 1984 --t Totals %ne 30, June 30, 1984 1983 Water Utility Sewer Assets: $ 2,481,025 Cash and investments (,.ate 5) $ 5,329,441 $ 3,426,872 Receivables: Accounts Accrued interest Inventory, at cost Prepaid expenses 858,229 202,561 7,624 1.840 --- 1,060,790 452,199 28,083 112,402 '1 75,538 4,195,094 97,671 4,552 3,441,477 105,295 6,392 Total current assets: 3,060,441 6,501,918 R es t r i c t ed asset s : Cash & investments (Note 5) 618,525 Accrued interest --- Total restricted assets: 61 8,525 518,525 --- 556,351 10,703 567,054 61 8,525 Investment in sewage treatment P aci 1 i ty 12,998,980 12,998,980 --- Property, plant and equipment (Note 6): Land and water rights 231,956 Bui 1 dings 37,964 Wells, reservoirs, and dams 1,289,853 Transmission & distrib. lines 4,022,304 Filters and pumps 147,349 Fire hydrants 364,969 Equipment and vehicles 184,476 Construction in progress 72,195 Total property, plant and Structures and improvements -e- Sewers, sewer lines and wells --- Fire protection service 5,759 equipment 6,356,825 227,250 459,206 37,964 37,948 1,289,853 4,022,304 4,420,783 147,349 364,969 588,938 2,676,618 5,759 231,956 37,964 2,120,747 1,289,853 4,022,304 6,001,567 147,349 364,969 1,437,640 11,220,165 5,759 37,948 4,420,783 404,462 2,604,423 7,694,s 66 14,051,691 26,8 80,27 3 Less accum. depreciation Net property, plant ( 1 ,976,114) and equipment 4,380,711 Total assets $ 8,440,713 LI- - (1,542,839) (3,518,953) ( 3,341,432) 6,152,027 10,532,738 23,538,841 $30,652,161 $28,300,989 I_ - $ 22,211,448 I I I I I I I I I I I I I I I I Water Utility Liabilities: Current liabilities (payable from current assets) : Accounts payable $ 463,786 Accrued wages payable 7,334 Deposits payable 88,512 Total current liabilities (payable from current assets) 559,632 Current liabilities (payable from restricted assets): Accrued interest 28,438 Current portion of revenue bonds payable 125,000 Total current liabilities (payable from restricted assets) 153,438 Total current liabilities 713.070 Long-term liabilities (Note 7) : Revenue bonds payable (net of unamortized discount of $7,404 and current portion) 894,596 Deferred revenue --- Total liabilities 1,607,666 Contributed capital 2,423,080 Retained earnings: Reserved for construction 615,540 Reserved for debt service 887,441 Unreserved: Fund Equity: Reserve for inventory supplies --- Designated for approved capital projects 66,253 Undesignated 2,840,733 Total retained earnings 4,409,967 Total fund equity 6,833,047 Total liabilities and fund equity $8,440,713 - Sewer $ 10,033 5,182 15,215 --- 15,215 2,563,778 2,578,993 16,389,407 111,535 7,625 --- 750,763 2,373,125 3,243,048 19,632,455 $ 22,211,448 2 - Totals 3une 30, June 30, 1984 1983 $ 473,819 $ 320,929 12,516 4,502 88,512 78,719 574,847 404,150 28,438 --- 125,000 125,000 153,438 125,000 728,285 529,150 894,596 893,362 4,186,659 1,422,512 2,563,778 --- 18,812,487 21,303,905 727,075 678,590 887,441 887,441 7,625 --- 81 7,016 825,213 5,213,858 3,183,328 7,653,015 5,574,572 26,465,502 26,878,477 $30,652,161 $28,300,989 -L - CITY OF CARLSBAD Enterprise Funds Combininq Statement of Revenues, Expenses and Chanqes in Retained Earnings 4- Year ended 3une 30, 1984 I I I I I I I I 1 I I I I II I I Totals %ne 30, 3une 30, Water Utility 1984 1983 Sewer Operating revenues: Metered water sales Sewer service charges Sewer construct ion fees Other charges for services $1,309,379 --- 104,953 --- $1,160,834 1,799,010 24,484 1,160,834 1,799,010 129,437 961,217 657,370 88,826 Total operating revenues 1,414,332 2,984,328 4,398,660 3,313,615 Operating expenses: Personnel services Office expenses Repairs and maintenance Professional services Insurance Purchased water Loss on disposal of property Sad debt expense Depreciation and amortization 283,886 2,950 1 30,663 599,986 5,232 --- --e --- 118.744 439,508 48,716 230,986 38,164 13,099 577,081 16,092 56,021 137,506 723,394 51,666 361,649 638,150 18,331 577,081 16,092 56,02 1 256,250 752,608 20,908 273,338 537,524 102,322 926,347 --- --- 1 59,396 Total operating expenses 1,557,173 1,141,461 2,690,634 2,772,443 Operating income (loss) ( 142,841) 1,700,026 541,172 1,842,867 Non-operating revenues ( expenses): Interest income 258,232 Interest expense and fiscal agent fees ( 56,875) Total non-operating revenues (expenses) 201,357 145,443 403,675 306,198 ( 56,875) ( 64,492) 346,800 241,706 Net income 1,988,310 2,046,026 58,516 782,878 Retained earnings at beginning of year 4,351,451 Prior period adjustment (Note 3) --- Retained earnings at beginning of year as adjusted 4,351,451 Retained earnings at end of year $4,409,967 4,791,694 --- 5,5 74,572 31,617 1,223,121 31,617 1,254,738 5,606,189 4,791,694 $3,243,048 d $ 7,653,015 $ 5,574,572 - 79 I I t I I I I I I I I I I t I t I 1 CITY OF CARLSBAD Enterprise Funds - --==ion Year ended 3une 30, 1984 Water Utility Sewer Sources of working capital: 0 pera t ions Net income $ 58,516 $1,988,310 Items not requiring working capital: Depreciation and amortization 137,506 1 18,744 Loss on disposal of property 16,092 --- Working capital provided by oper at ions 212,114 2,107,054 Contribution from other funds --- 12,727 Total sources of working capital 212,114 2,119,781 Uses of working capital: Acquisition of property, plant, and Decrease in long-term revenue bonds equipment 11,270 25,465 payable --- --- Reduction of deferred revenue --- 136,000 assets and related liabilities 23,033 --- Net increase (decrease) in restricted Total uses of working capital 34,303 161,465 Net increase in working capital $177,811 $1,958,316 - - -.cI Elements of net increase (decrease) in unrestricted working cap1 tal: Cash and cash equivalents $ 106,885 $1,795,684 Accounts receivable 447,136 161,455 Inventory (14,731) 7,624 Prep a id ex pens es (38) (169,108) Accounts payable (325,441) 172,551 Accrued wages payable (7,334) (680) Accrued interest receivable (18,873) (9,210) Deposits payable ( 9,793) --- Net increase in working capital $ 177,811 $1,958,316 IIP .c.Lil- i Totals 3une 30, 3une 30, 1984 1983 256,250 159,396 16,092 2,319,168 942,274 12,727 174,115 2,331 ,895 1,116,389 36,735 355,324 23,033 (809,244) 195,768 ( 338,920) $2,136,127 $1,455,309 $1,902,569 $1,500,110 608,59 1 (10,961 12,117 (28,083 1 (7,107) 6,970 (169,146) 170,221 (152,890) (221,985 ( 8,014) 7,782 ( 9,793) (8,945) 80 I CITY ff CPRLSBAD Internal Service Funds %lmtxf-hm- 3une 30, 1984 General I Liability Totals Workers ' self Central 3une 30, &ne 30, Compensation Insurance Garage 1984 1983 1 Assets Cur rent assets: Cash and cash equivalents $ 748,004 Accrued interest receivable --- Total current assets 748,004 Property and equipment: Machinery and equipment --- Less accumulated depreciation --- Net property and equipment Total assets $ 748,004 Liabilities and Fund Equity Current li ab11 i t ies: Accounts payable Accrued wages payable Estimated claims payable Tot a1 current 11 abilities Total liabilities Contributed capital: Contributed from Other Funds Retained earnings (deficit): Reserved Unreserved Total retained earnings (deficit) Total fund equity Total liabilites and fund equity ~ ~~~ $ 7,082 231,884 238,966 238,966 500,000 --- --- 9,038 9,038 509,038 $ 748,004 $ 799,381 $ 192,312 $1,739,697 $1,463,870 --- 643 643 7,365 799,381 192,955 1,740,340 1,471,235 --- 1,350,218 1,350,218 1,308,296 --- ' (761,657) (761,657) (716,802) --- 588,561 588,561 591,494 $ 799,381 $ 781,516 $2,328,901 $2,062,729 $ 3,007 $ 80,801 $ 90,890 $ 36,643 --- 4,862 4,062 4,212 255,526 --- 487,410 299,643 258,533 85,663 583,162 340,498 258,533 85,663 583,162 340,498 $ 850,000 745,456 2,095,456 1,791,494 33,958 33,958 --- (343,110) (49,603) (383,675) (69,263) ( 309,152) (49,603) (349,717) (69,263) 540,848 695,853 1,745,739 1,722,231 $ 799,381 $ 781,516 $2,328,901 $2,062,729 81 I I I I I I I I I II I I I 1 I I I I I I I I I I I I I I I I I I I CITY OF CARLSBAD Internal Service Funds and Changes in Retained Earnings -_____ Combining Statement of Reve nues. EXD . enses Year ended June 30, 1984 Ge ner a1 Liability Totals Workers ' self Central 3une 30. 3une 30. Compensation Insurance Garage 1984 1985 0 per at ing revenue: Charges for services Reimbursed expenditures $ 714,279 $ 714,279 $ 526,680 --- 321,648 326,906 714,279 1,035,927 853,586 --- --a $ 228,148 228,148 $ 93,500 93,500 Total operating revenue Operating expenses: Personnel services Fuel Office expense Supplies and parts Repairs and maintenance Claims expense Depreciation Other operating charges 18 8,5 54 187,316 1,246 72,137 77,208 145,452 2,784 188,554 187,316 1,246 72,137 77,208 548,191 145,452 2,784 1 , 322,888 161,625 19 8,094 5 60 84,820 54,804 402,854 2,973 905,730 --- Total operating expenses 333,315 (105,167) 314,876 674,697 Operating income ( loss) ( 221,376) 39,582 (286,961) (52,144) Non-operating revenues Interest revenue Sale of property 63,203 --- 62,057 10,636 135,896 98,793 18,134 18,134 5,764 --- Tot a1 non-operat ing revenues 63,203 62,057 28,770 154,030 104,557 Income ( loss) before operating transfers (41,964) (159,319) --- 68,352 (132,931) 52,413 Operating transfers in Net income ( loss) (159,319) 68,352 (132,931) 67,966 Retained earnings ( deficit) at beginning of year (149,833) 29,568 ( 69,263 ) ( 1 37,Z 29 51,002 Prior period adjustment (Note 3) --- --- Retained earnings (deficit) at Retained earnings (def icit) at beginning of year as adjusted 51,002 end of year $ 9,038 (149,833) $ (309,152) (1 17,955) (216,786) ( 1 37,229: $ (49,603) $ (349,717) $ (69,263 9-- 82 CITY OF CARLSBAD Internal Service Funds Combining Statement of Changes in Financial Position Year ended 3une 30, 1984 General Liability Totals Workers ' Self Central 3une 30, 3une 30, Compensation Insurance Garage 1984 1983 Sources of working capital: Operat ions : Net income (loss) $ (41,964) $ (159,319) $ 68,352 $(132,931) $ 67,966 Items not requiring working Less gain on sale of property --- --- (18,134) (18,134) --- Depreciation --- --- 145,452 145,452 --- cap i t a1 : Working Capital provided by operations (41,964) (159,319) 195,670 (5,613) 67,966 Contributions from other funds --- 150,000 6,439 156,439 891,494 Proceeds from sale of property -- - --- 36,952 36,952 --- Total sources of working capital (41,964) (9,319) 239,061 187,778 959,460 Uses of working capital: Acquisition of fixed assets --- --- 161,337 161,337 591,494 Total uses of working capital --- 161,337 161,337 591,494 Net increase (decrease) 1 n working capital $ (41,964) Elements of net increase (decrease) in working capital: Cash and investments $ 73,987 Accrued interest receivable (5,328) Estimated claims payable (105,741 ) Accounts payable (4,882) Accrued wages payable --- Due to other funds --- Net increase (decrease) in working capital $ (41,964) - $ (9,319) $ 77,724 $ 71,674 $ 130,166 (2,037) 643 ( 82,026) --- 3,070 (52,435) --- (650) --- --- $ (9,319) $ 77,724 83 $ 26,#1 $ 367,966 - $ 275,827 $ 484,374 (6,722) 3,142 (187,767) (92,082) (54,247) (35,653) (650) (4,212) --- 12,397 $ 26,441 $ 367,966 - I I I- I I I I 0 I I I I t I I I I I b CITY OF CARLSBAD Agency Funds - --__ Combining Statement of Changes in Assets and Liabilities Year ended 3une 30, 1984 Balance 3uly 1, 1983 Deferred Compensation Agency Fund Assets Balance Additions Deductions %ne 30, 1984 Cash and investments (Note 5) $ 483,633 Liabilities Deferred compensation payable lccounts payable Deposits payable Tot a1 1 i ab i 1 it i es - -- $ 8,235 475,398 $ 483,633 Cash and investments Accrued interest receivable Accounts receivable Total assets Liabilities Accounts payable Deposits payable Total liabilities $ 386,084 --- --- $ 386,084 --- $ 386,084 $ 386,084 $ 10,569,283 $ 10,728,473 $ 324,443 P $ 324,443 $ $ 324,443 --- 8,235 --- 10,244,840 10,720,238 --- $ 10,569,283 $ 10,728,473 $ 324,443 - $ 4,355,480 $ 2,677,003 $ 2,064,561 81 0 81 0 --- 70 70 --- $ 4,356,360 $ 2,677,883 $ 2,064,561 $ 30,859 $ 30,859 --- 4,325,501 2,647,024 $ 2,064,561 $ 4,356,360 $ 2,677,883 $ 2,064,561 (Continued) Contractors Deposits Agency Fund Assets - CITY of CARLSBAD 1 .- Combining Statement of Changes in Assets and Liabilities, continued Miscellaneous Deposits Agency Fund Year ended 3une 30, 1984 Assets Cash and investments (Note 5) ,4ccrued interest receivable Accounts receivable Total assets Liabilities Accounts payable Deposits payable Total liabilities Totals - All Aqency Funds Assets Cash and investments (Note 5) Accrued interest receivable Accounts receivable Total assets Balance 3uly 1, 1983 Additions Deductions %ne 30 198 3 $ 844,891 810 70 $ 845,771 $ 30,859 814,912 $ 845,771 $1,714,608 810 70 $1,715,488 Liabilities Deferred compensat ion payable Accounts payable Deposits payable Total liabilities --- $ 39,094 1,676,394 $1,715,488 --- $ 30,859 --- 814.912 $ 14,924,763 $ 14,250,367 81 0 1,620 70 140 $ 14,925,643 $ 14,252,127 4 $ 324,443 --- 30,859 $ 69,953 14,570,341 14,182,174 $ 14,925,643 $ 14,252,127 - --- -I --I I $2,389,004 --- -- $2,38 9,004 $ 324,443 1 --- $2,38 2’064’561 9,004 I 85 I I 1 I I I I-- I I I I I I I I I I I I I I I I Statistical Sect ion 86 CITY OF CARLSBAD General Expenditures by Function Last Ten Years General Public Year (Memo Only) Government Safety (1) Fiscal Total 1974-75 $ 4,841,800 1,463,821 1,458,573 1975-76 5,540,958 1,660,069 1,561,812 1976-77 6,916,158 2,280,639 1,869,808 1977-78 8,608,080 2,767,513 2,592,993 2 , 634 , 839 "8 -79 9,566 , 353 3 , 3 14 , 694 m-80 io, 958,699 3, i 12,025 3,058,443 1980-81 13,837,197 4,547,215 3,407,025 1981-82 14,329,047 2,849,059 4,888,849 1982-83 14,955,142 2,272,174 5,285,609 1983-84 16,084,691 2,551,209 5,813,451 (3) Culture Debt (4) Public Works Recreation We1fare")Service 1,196,512 1,443,009 1,523,376 1,981,274 2,3 14,667 2,495,741 2,868,460 3,062,434 3,660,043 3,772,627 569,791 725,928 1,095,120 1,122,003 1,161,115 1,599,729 2,261,888 2,732,343 2,573,014 2,764,121 153,103 150,140 147,Z 15 144,297 141,038 .544,597 148,164 608,009 144,600 650,202 146,160 727,155 437,147 825,236 358,047 Includes General, Special Revenue, and Debt Service funds. (1) (2)The City assumed responsibility for the Carlsbad Housing Office in 1979-80. (3)In 1982-83, the City adopted the entity concept of reporting. the Debt Service Expenditures to increase due to the inclusion of the City's Building and Parking Authorities Lease Revenue Bond payments. special revenue to an enterprise fund. Prior figures have not been restated to remove sewer operation expenditures. This figure also includes the cost capital projects paid for by special revenue funds. This causes (4)Durina 1982-83, the City converted the sewer operation activity from a 87 I I I I I I I I I I 1 I 1 I I 1 1 I I I I- I I I I I I I I I I I I I I I I ~~ GENERAL EXPENDITURES BY FUNCTION. 1983-04 CULNRE/REC 17.3% PUBLIC WKS 23.5% 3.8 INCLUDES GENERAL,SPECIAL REVENUE AND DEBT SERVICE FUNDS ONLY. 0 GEN GOVT 16.0% 2.6 WARE 4.9% 0.8 DEBT SEW 2.5% 0.4 PUBLIC SAm 35.m 5.8 VALUES ARE IN MILLION DOLLARS GENERAL EXPENDITURES BY FUNCTION TOTAL EXPEND ITURES - LAST TEN YEARS MILLION DOLLARS 20 I 1 15 10 5 0 74-75 75-76 78-77 77-78 78-79 79-80 80-81 81-02 82-03 83-04 FISCAL YEAR INCLUDES GENERAL.SPECIAL REVENUE AND DEBT SEW. FUNDS 88 Fiscal Year Total 1974-7s $ S,689,159 1975-76 6,964,649 1976-77 0,466,866 1977-78 10,362,623 1978-79 9,015,129 1979-80 12,305,902 1980-81 14,507,827 1981-82 16,299,152 1982-83 17,034,503 1983-84 20,456,139 CITY OF CARLSBAD General Revenue by Source Last Ten Years (1) Property Taxes 2,37S, 319 2,894,098 2,923,710 3,484, SO4 1,633,938 2,61S,181 3,344,171 4,193,866 4,393,176 4,696,862 Sales Taxes 939,721 1,118,387 1,402,841 1,967,968 2,389,832 2,969,586 3,302,134 3,941,152 3,974,732 4,891,379 Franchise Taxes 54,818 78,254 96,818 111,271 141,185 175,257 250.9 10 1 288,9S6 358,228 466,102 Other Taxes S52,88S 731,747 1,064,015 1,202,799 1,4S1,79S 1,526,547 1,61S,950 1,347,202 1,9S0,631 2,s 10,600 Includes General, Special Revenue, and Debt Service funds. (1) -- --.--.---- TOTAL GENERAL REVENUE PROPERTY TAX AX SALES TAX REVENUE UZTTENYEARS LAsTlENYEAlzs Wa 0 mh w - I MILLION WLURS I I I I I I I I I YI I I I 1 I I 1- I I I 1 I I I /I I I I I 1 1 1x1 I I 1I 1 If I I 1 I I /I I I I I I I I YI I I I 1 MlLLloN WUARS -1 ~ n1 I I I I I I I I I I I I I I I I I I I Business Licenses 88,675 111,253 141,050 151,768 186,845 242,342 247,798 258,663 279,973 351,875 Other Licenses 322,203 448,814 908,521 909,20 1 626,749 829,623 1,048,332 537,476 491,267 2,099,942 Int ergov- er nment a1 459,473 547,477 873,544 655,588 1,3 16,172 1,133,947 1,875 ,243 2,551,262 1,777,587 566,129 Charges for Services 546,670 643,995 859,008 862,138 851,465 1,168,326 1,737,238 1,986,800 1,413,075 2,182,267 Fines and Miscel- Forfeits Interest laneous 84,279 100,859 139,480 125,964 129,504 152,171 230,684 260,498 231,086 256,471 223,751 214,346 294,892 489,638 817,604 1, 143,121 1,472,68 1 1,533,333 1,211,802 1,155,052 41,365 56,765 89,054 183,828 130,620 167, 576 124,791 75,963 179,271 68,002 BUSINESS LICENSE REVENUE UzTmrURs - l!n!um I CHARGES FOR SEW1 CES UzTlENyEASIs YlLLlols WLLARS ¶.- t 1 I IU II a. r IUU 90 I CITY OF CARLSBAD Fiscal Year 1974 - 75 1975 - 76 1976 - 77 1977 - 78 1978 - 79 1979 - 80 1980 - 81 1981 - 82 1982 - 83 1983 - 84 Ratio General Bonded Debt to Assessed Valuation and Net Bonded Debt Per Capita Last Ten Fiscal Years Net Assessed Valuation 121,045,109 150,147,591 156,629,855 196,697,879 245,296,620 312,538,738 361,068,983 ( Perm nt of I Out st and ing Total Per Capita Principal Va 1 ua t ion Debt Population I 27,946 1 4 1,850,OOO 1.5 92.61 19,977 1,765,000 1.1 84.17 20,970 1,680,000 1.0 69.59 24,143 1,595,000 0.8 57.07 1,510,000 0.6 47.04 32,100 1,425,000 0.4 40.20 35,448 1,245,000 0.3 34.97 35,606 I 1,687,082,037(1) 1,145,000 0.06 31.65 36,172 2,015,289,869(1) 1,030,000 0.05 26 . 39 39,037 2,194,598,447(1) 915,000 0.04 22.60 40,486 (1) In 1981-82, the County of San Diego began providing assessed valuation data based on full market value. The 1981-82 and 1982-83 values may be converted to the basis used between 1973-74 and 1980-81 by multiplying by 25%. (2) Library and sewer general obligation bonds. I 1 I 1 I 1 1 91 CITY OF CARLSRAD Computation of Legal Debt Margin 3une 30, 1984 25% of Assessed Valuation I Debt Limit 15% of Assessed Valuation I I 1 I I I I I I I I I Amount of Debt Applicable to Debt Limit: (1) Bonded Debt Capitalized Leases Total Amount of Debt Applicable to Debt Limit LEGAL DEBT MARGIN Percent of Debt Limit $ 548,649,611 82,297,442 (1) General Obligation Bonds (Library and Sewer) Parking Authority Building Authority TOTAL BONDED DEBT 92 $ 3,700,000 473,598 4,173,598 78,123,844 5.1% $ 915,000 2 545 000 240; 000 $ 3,700,000 CITY OF CARLSBAD Schedule of Direct and Overlaping Bonded Debt 3une 30, 1984 (1) 1983-84 Assessed Valuation : $2,244,519,647 Percent Debt as of Direct and Overlapping Bonded Debt: Applicable 6/ 30/ 83 San Diego County Building Authorities 3.800% 3.955 Metropolitan Water District 0.619 Oceanside-Carlsbad Community College District 25.931 Carlsbad Unified School District Carlsbad Unified School District Authority 92.184 San Marcos Unified School District 20.027 San Dieguito Union High School District 10.219 Encinitas Union School District 25.786 Encinitas Union School District Authority 25 . 786 Other School Districts Various Tri-City Hospital District 30.254 North San Diego Hospital District & Authority 0.466 San Marcos County Water & I.D.'s fl, 2, 6 Costa Real Municipal Water District Costa Real (Carlsbad) Municipal Water Dist. Olivenhain Municipal Water District I.D. #l San Diego County Water Authority (various issues) 92 -229-92 0242 Leucadia County Water District 53 . 583 1.776-6.824 Certificates of Participation 96 . 360 I.D.'s fl, 2, 3, 4 92.638-96.350 33.373 City of Carlsbad 100. City of Carlsbad Building Authorities Vista Irrigation District 0.111 100. $ 6,546,830 1,566,773 2,845,2 39 116,689 990,363 2,189,370 893,845 541,607 452,544 442,229 20,784 779,040 86,558 487,605 106,538 12,141,360 1,314,107 644,098 915,000 2,785,000 748 TOTOL DIRECT AND OVERLAPPING BONDED OEBT 35,866,327 Ratios to Assessed Valuation: Direct Debt ($3,700,000) 0.16% Total Debt 1.60% ("Cross assessed value provided by County of San Diego, Auditor and Controller (exclusive of Homeowners exemption). 93 I I 1 1 I I I 1 I I I I 1 I I I I 1 I ___ I CITY OF CARLSBAD Ratio of Annual Debt Service For General Bonded Debt to Total General Expenditures - Last Ten Fiscal Years Debt Total Ratio of Debt Fiscal Total (1) General (2) Service to General I I Year Principal Interest Service Expenditures Expenditures % I 1974-75 I :;;:::; 1977-78 "Q-79 Y-80 1980-81 I 1981-82 $ 85,000 85,000 85,000 85,000 85,000 95,000 95,000 100,000 115,000 15,000' 3, $68,108 65,140 62,215 59,297 56,038 53,164 49,600 46,160 42,757 3 ,022 $153,103 150,140 147,2 1 5 144,297 141,038 148,164 144,600 146,160 157,797 53,022 $ 4,841,800 5,540,958 6,916,158 8,608,080 9,566,353 10,958,699 13,837,197 14,329,047 14,955,142 16,531,162 ("Debt Service Requirement on General Obligation Bonds Comprised of 1962 Sewer Bonds Series A, B, C; and 1966 Library Bonds. I Excludes Debt Service for Building and I Parking Authorities. I (2)Includes General, Special Revenue, and Debt Service Funds I (3)In 1983-84, the City began recording principal payments in the year they become payable. The general obligation principal payments are due 3uly 1 each year and have previously been paid by the City on 3une 30 each year. 3.2% 2.7 2.1 1.7 1.5 1.4 1 .o 1 .o 1.1 0.0 94 CITY OF CARLSBAD Water Bonds Last Ten Fiscal Years Net Revenue Direct Available Fiscal Gross Operating for Debt Debt Service Requirements Year Revenue Expenses Service Principal Interest Total Coverage - 1974-75 1975-76 1976-77 1977-78 1978-79 1979-80 1980-8 1 781-82 1982-83 1983-84 $1,112,969 1,257,334 1,271,353 1,388,195 1,525,143 1,806,817 1,997,591 2,084,262 1,934,415 1,672,564 $ 727,981 785,26 1 897,240 1,023,717 1,269,836 1,333,560 1.655,756 1,620,5 19 1,945,681 1,557,173 $384,988 $70,000 472,073 75,000 374,113 60,000 364,478 85,000 255,307 90,000 473,257 95,000 341,835 105,000 463,743 215,000 (11,266) 115,000 115,390 -- - $105,096 $175,096 100,972 175,972 96,362 176,362 91,245 176,245 85,603 175,603 80,377 175,377 74,985 179,985 69,715 284,715 ' 64,492 179,492 56,875 56,875 220% 268 21 2 207 145 270 190 163 (6) 20 3 WATER ENERPRISE GROSS RMNUE AND DIRECT OPERATING EXPENS3 NET REVENUE AVAILABLE FOR DEBT SERVICE USTmYEARs LAsflENyuw la& -7 Da. 95 I I I I I I I I I I 1 I I I I I I I I I I I I I I I I I I I I I I I I Demographic Statistics city Population Popu 1 at ion - Year Miles Population Change Population of County Square Percent County ( Percent 1975 28.3 1976 28.6 1977 28.7 1978 28.7 1979 29.1 I 1980 29.4 i 1987 29.7 1982 29.8 I 1983 32.0 1984 32.0 I ~ I 19,977 20,970 24,143 27,946 32,100 35,448 35,606 36,172 39,037 40,486 I 1990 75,300 I I 1995 92,100 2000 10.1% 5 .O 15.1 15.8 14.9 10.4 0.4 1.6 7.9 3.7 1,559,505 1,590,700 1,656,800 1,694,800 1,767,450 1,808,200 1,899,900 1,924,700 1,986,035 2,040,888 (2) 1.3% 1.3 1.5 1.6 1.8 2.0 1.9 1.9 2.0 2.8 I I (estimate) 107,300 ( (2) 'l)Source - County Data Base, San Diego County 1 POPULATI ON IASrTLw~ I ("County Future Population Estimate Not Available (3)Population for City General Plan area I 96 Schedule of Assessed Valuation Last Ten Fiscal Years Less Secured Unsecured Property Total Fiscal Year Property Property Exempt ions Valuation 1974 - 75 $ 123,890,815 1975 - 76 154,000,994 1976 - 77 158,745,285 1977 - 78 200,426,225 1978 - 79 249,889,799 1979 - 80 318,374,958 1981 - 82(')1,700,974,823 1982 - 83(1)2,027,411,290 1983 - 84(1)2,195,611,840 1980 - 81 366,867,584 $ 5,056,766 5,428,247 7,381,254 9,115,516 10,823,286 12,937,939 8,877,200 43,077,175 50,604,897 57,309,394 $ 1,441,339 1,729,582 1,149,614 2,189,620 2,171,421 2,354,961 2,578,751 8,210,76 1 13,841,078 8,401,587 $ 127,506,242 157,699,699 164,976,925 207,352,121 258,541,664 328,957,936 373,166,033 1,735,841,237 2,064,175,069 2,244,5 19,647 (1) In 1981-82 the County of San Diego began providing assessed valuation data based on full market value. to the basis used between 1972-73 and 1980-81 by multiplying by 25%. The 1981-82 values and 1982-83 may be converted 97 1 I I I 1 1 I I I I I I I 1 I I 1 I I I I I I I I I I I I I I I I I I I I Business Inventory Exempt ions $ 1,368,033 1,913,518 2,304,270 3,170,192 4,160,094 5,207,298 --- --- --- - -- Homeowner's Exemptions $ 5,093,100 5,638,550 6,042,800 7,484,050 9,084,950 11,211,900 12,097,050 48,759,200 48,885,200 49,921,200 Net Taxable Value $ 121,045,109 1 50,147,59 1 156,629,855 196,697,879 245,296,620 312,538,739 361,068,983 1,687,082,037 2,015,289,869 2,194,498,447 Fiscal Year 1974-75 1975-76 1976-77 1977-78 1978-79 1979-80 30-81 1981 -82 1982-83 1983-84 S CITY OF CARLSBAD 1- Construction and Business Activity Last Ten Years Building Permit Revenue 110,952 190,492 613,427 520,603 119,224 181,839 328,453 271,542 490,100 Percent Change (52.3) % 71.7 222.0 (15.1) (77.1) 52 .5 80.6 (17.3) 80.5 1,068,876 118.1 Business Estimated (I) Licenses Percent Valuation $ 23,700,000 41,900,000 85,900,000 52,700,263 79,400,000 198,520,304 ( "Information for fiscal year 1972-73 through 1977-78 Issued Change $ 88,675 11 1,253 141,050 151,768 186,845 242,342 247,798 258,663 279,973 351,875 12.9% 25 .5 26.8 7.6 23.1 29.7 2.3 4.4 8.2 25.7 is not available. BUILDING VALUATION 1978-79 TO 1983-84 - &'MI% MILLION DOLLARS FISCAL YEAR VAUUTla PRIM TU 1-7S NQT mY AVAIIAIILE 1 I I I 1 I I I I I 1 1 99 __ -- ___-I I I I I I I 1 41 I I I I I I I I I I riate of Incorporation Type of City Form of Government Area Population Number of Street Lights CITY OF CARLSBAD Miscellaneous Statistical Information Miles of Streets Fire Protection: Number of Stations Number of Firefighters & Officers Pol ice Protect ion: Number of Stations Number of Sworn Police Officers Recreation and Culture: Number of Parks Number of Libraries Number of Volumes Total Number of City Employees kly 16, 1952 General Law Counci 11Manager 32.0 sq. miles 40,486 2,454 138 3 49 1 54 22 2 148,365 31 5 100 I CITY OF CARLSBAD Schedule of Principal Employers 1983-84 Firm Manufacturing: Hughes Aircraft Company, Burroughs Corporation Sargent Industries Magnedyne Inc. Eaton-Leonard Corporation Dyna Med Inc. Beckman Instruments Anthony Industries (Pool Division) Industrial Products Division Non-manufacturing: Plaza Camino Real La Costa Hotel & Spa Tri-City Hospital Mira Costa college Car Country Auto Dealers Frazee Flowers San Diego Gas & Electric, Encina Army & Navy Academy Carlsbad Unified School District Lopez Farms Sanchez Farms Number of Product/Service Employees Electronic components Computer components Industrial seals Electronic motors Vending machines Emergency medical products Microbics operation Swimming pools & related equipment Source: City of Carlsbad Chamber of Commerce 101 Shopping center Hotel & health spa Di s tr ic t ho s pi tal Community college Car dealers All major agencies Flower growing and processing Power gene r at io n Private junior/senior high school Education Tomato /vegetable growers Tomato /vegetab le growers 1,100 37 5 28 0 220 180 160 150 75 1,500 1,100 1,200 520 460 450 150 100 350 300 300 I I I I I I I 1 I I 1 I I I I