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HomeMy WebLinkAbout; ; 1992-1993 CAFR; 1993-06-30CITY OF CARLS BAD 7200 Carlsbad Village Drive • Carlsbad, CA 92008 Comprehensive Annual Financial Report FISCAL YEAR ENDED JUNE 30,1993 Prepared by the Finance Department CITY OF CARLSBAD Comprehensive Annual Financial Report Year Ended June 30, 1993 TABLE OF CONTENTS INTRODUCTORY SECTION: Table of Contents Letter of Transmittal Location Map List of City Officials Organization Chart FINANCIAL SECTION: Independent Auditors' Report 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 (Budgetary Basis) All Governmental Fund Types • Combined Statement of Revenues, Expenses and Changes in Retained Earnings - All Proprietary Fund Types • Combined Statement of Cash Flows - All Proprietary Fund Types • Notes to General Purpose Financial Statements Supplemental Data: Governmental Funds: General Fund: • Schedule of Revenues - Budget and Actual (Budgetary Basis) • Schedule of Expenditures - Budget and Actual (Budgetary Basis) PAGE i 1 22 23 24-25 27 28 31 33 34 35 37 72 73 CITY OF CARLSBAD Comprehensive Annual Financial Report Year Ended June 30, 1993 TABLE OF CONTENTS. (CONTINUED) PAGE Special Revenue Funds: • Combining Balance Sheet 76 • Combining Statement of Revenues, Expenditures and Changes in Fund Balances 78 • Combining Schedule of Revenues and Expenditures - Budget and Actual (Budgetary Basis) 80 Debt Service Funds: • Combining Balance Sheet 88 • Combining Statement of Revenues, Expenditures and Changes in Fund Balances 89 • Redevelopment Bonds Fund Schedule of Revenues and Expenditures - Budget and Actual (Budgetary Basis) 90 Capital Projects Funds: • Combining Balance Sheet 94 • Combining Statement of Revenues, Expenditures and Changes in Fund Balances 98 Proprietary Funds: Enterprise Funds: • Combining Balance Sheet 104 • Combining Statement of Revenues, Expenses and Changes in Retained Earnings 105 • Combining Statement of Cash Flows 106 Internal Service Funds: • Combining Balance Sheet 108 • Combining Statement of Revenues, Expenses and Changes in Retained Earnings 109 • Combined Statement of Cash Flows 110 CITY OF CARLSBAD Comprehensive Annual Financial Report Year Ended June 30, 1993 TABLE OF CONTENTS. (CONTINUED) PAGE Fiduciary Funds: Agency Funds: • Combining Statement of Changes in Assets and Liabilities 112 Account Groups: General Fixed Asset Account Group: • Schedule of General Fixed Assets by Function 114 • Schedule of Changes in General Fixed Assets by Function 115 • Schedule of General Fixed Assets by Source 116 Schedule of Annual Debt Service Requirements 118 STATISTICAL SECTION: (Not covered by Independent Auditors' Report) • General Expenditures by Function, Last Ten Fiscal Years 124 • General Revenues by Source, Last Ten Fiscal Years 126 • Ratio of General Bonded Debt to Assessed Valuation and Net Bonded Debt Per Capita, Last Ten Fiscal Years 128 • Computation of Legal Debt Margin 129 • Schedule of Direct and Overlapping Bonded Debt 130 • Ratio of Annual Debt Service for General Bonded Debt to Total Governmental Expenditures, Last Ten Fiscal Years 131 • Revenue Bond Coverage - Water Utility, Last Ten Fiscal Years 132 • Demographic Statistics, Last Ten Fiscal Years 134 • Schedule of Assessed Valuation, Last Ten Fiscal Years 136 • Construction and Business Activity, Last Ten Fiscal Years 138 • Property Tax Levies and Collections, Last Ten Fiscal Years 139 iii CITY OF CARLSBAD Comprehensive Annual Financial Report Year Ended June 30, 1993 TABLE OF CONTENTS. (CONTINUED) PAGE • Special Assessment Billings and Collections, College Boulevard Assessment District, Last Seven Fiscal Years 140 • Principal Employers, 1992-1993 141 • Principal Taxpayers, 1992-1993 142 • Miscellaneous Statistical Information 143 IV City of Carlsbad Finance Department October 8, 1993 Honorable Mayor, City Council, and City Manager CITY OF CARLSBAD Carlsbad, California 1992-93 COMPREHENSIVE ANNUAL FINANCIAL REPORT LETTER OF TRANSMnTAL We are pleased to present the 1992-93 Comprehensive Annual Financial Report of the City of Carlsbad to the City Council and the City Manager. This report includes financial statements of the City, the Housing Authority of the City of Carlsbad, the Parking and Building Authorities of the City of Carlsbad, the Carlsbad Public Improvement Corporation, the Carlsbad Redevelopment Agency and the Carlsbad Municipal Water District, as well as the opinion of our independent auditors, Conrad & Associates. The completion of this independent audit is an important part of the total financial management program for the City of Carlsbad. The information found in this report is provided by management to the Council and the public to assist those interested in understanding the fiscal condition of the City as of June 30, 1993. Responsibility for both the accuracy of the data, and the completeness and fairness of the presentation, including all disclosures, rests with the City. To the best of our knowledge and belief, the enclosed data are accurate in all material respects and are reported in a manner designed to present fairly the financial position and results of operations of the various funds and account groups of the City of Carlsbad. All disclosures necessary to enable the reader to gain an understanding of the government's financial activities have been included. Background Carlsbad is located about 35 miles north of the City of San Diego on the southern California coast. The City is governed by a five member City Council under the Council/Manager form of government. Carlsbad is a general law city incorporated in 1952. The City covers about 42 square miles and has a population of 67,172. Industries in the area include a major regional shopping center, 22 auto dealers, 24 hotels offering 1,884 rooms for tourist lodging, aerospace manufacturing, electronics, golf apparel and equipment manufacturers, several business and light industry parks, and numerous land developers building single and multi-family housing in a variety of community settings. 1 1200 Carlsbad Village Drive • Carlsbad, C-A QPOOR-1989 - (619) 434-2867 • FAX (619) 434-1987 Services Provided by the City The City provides the full range of services normally associated with a municipality including police, fire, parks and recreation, library, planning and zoning, building and engineering, various maintenance services and administration. The City provides water services through the Carlsbad Municipal Water District, a subsidiary district of the City. City Council serves as the Board of Directors for the Carlsbad Municipal Water District. Solid waste collection is provided through a franchise arrangement with a local refuse collection service. In addition to the usual City services, Carlsbad offers a variety of programs to help local residents and businesses. The City operates a redevelopment agency that encompasses 0.4 square miles of the downtown area, as well as a housing authority that provides 430 low and moderate income families with housing assistance. The City's literacy program, funded by the General Fund, provides adult education to local area residents. Older Carlsbad residents receive assistance through the City's senior citizen programs. Also, the City provides major support for the Convention and Visitors Bureau operated in cooperation with the Carlsbad Chamber of Commerce. The City supports various service agencies such as the Women's Resource Center, YMCA and other agencies providing social services to Carlsbad residents. Finally, the City has reserved over $300,000 for support of the arts, art programs, and the purchase of works of art. Significant Events and Accomplishments During 1992-93 the City experienced many significant events or accomplishments that may not be evident from a review of the financial statements. Some of the more important events are shown below. Balanced Budget - One of the most significant accomplishments this year was again successfully balancing the General Fund budget. General Fund revenues were impacted .downward when the State of California adopted its budget in September 1992. Approximately $1.2 million in property taxes were diverted from the City's General Fund to the State for school funding. In addition, City development revenues fell precipitously due to recessionary influences. Departments decreased expenditures by holding staff at current levels, decreased maintenance and operating expenses, deferred projects, and cut capital purchases. Through these efforts, the City was able to keep the General Fund expenditures in line with the revenues and $2.7 million under budget. Economic Development - City Council established the economic development program in 1992-93 to further its goal of achieving economic growth and stability for the City through proactive efforts to attract targeted industries to provide a strong economic base. Staff began work on a strategic plan, with much of the effort in 1992-93 related to potential development of Carlsbad Ranch which includes a major hotel, golf courses, gemology institute, and a theme park. General Plan Update - An update of all elements of the General Plan is proceeding with town hall meetings and community forums to receive citizen input. The public review process continues on the first complete General Plan evaluation since the 1970's. Eleven existing General Plan elements were combined into eight, for example Open Space and Conservation became one element; and all elements were reformatted for consistency. The Environmental Impact Report (EIR) on the General Plan Update was produced and is currently circulating for public comment. City Council is expected to assess the updated plan in 1993-94. Growth Management - The City's Growth Management Program was established by a vote of the citizens in 1986. Under this program, development occurs only when infrastructure improvements required to serve the development are financed and constructed as a part of the development. Standards have been, established in eleven areas such as circulation, libraries, fire protection, parks, drainage, water, sewers, and open space. An outgrowth of this program is a long range capital improvement program which covers the current year through buildout of the City. The growth management program, in conjunction with the current recession, has had a major effect on the building industry as shown in the following chart: DWELLING UNITS CONSTRUCTED LAST EIGHT YEARS Growth Management implemented in 1987 1986 1987 1988 1989 1990 1991 1992 1993 FISCAL YEAR The comprehensive Growth Management Financing Program is an important part of growth management. This program links the infrastructure funding needs of the City and other agencies, such as schools, together with the needs of development to fund public purpose projects. The coordinated effort depends on the rational use of Mello-Roos Community Facilities Districts, 1913/1915 Act Assessment Districts and fee programs to finance facilities concurrent with demand without overburdening the land or home owner. Construction of Capital Projects - Because of the sluggish pace of development and corresponding decline in developer fees, the City slowed its aggressive capital building program, with an outlay of approximately $8 million in 1992-93. Declining revenues led to project phasing and moving some planned projects to future years. During the last nine years, Carlsbad expended more than $122 million for capital projects including major streets, community parks, a senior center, a civic facility for police and fire, fire stations, main library, and sea wall and bluff protection. This dedication to improving the infrastructure of the City is expected to continue into the foreseeable future as the City implements its long range capital improvement program. Community Facilities District (CFD) No. 1 - Second year taxes for the City's first Mello- Roos district were received in 1992-93. The citywide CFD taxes land scheduled for future development. Through bond issues and developer payments, the CFD will be used to fund a wide variety of public improvements including civic facilities, freeway interchanges and major road additions or improvements, which were previously funded on a pay-as-you-go basis by developer fees. As development occurs for residential property, the Mello-Roos obligation must be paid in full by the developer when a building permit is given, with pass- through of the CFD tax allowed only on property developed for commercial/industrial purposes. Geographic Information System (GIS) - Development of a parcel-based Geographic Information System (GIS) continued in 1992-93. GIS contains base layers of parcel, roadways, and address information which will be used by City departments to provide more efficient safety and public services, monitor growth, and allow financial and land use projections. GIS was utilized in 1992-93 to provide land use, topography, and mapping information for candidate preserve areas within the Habitat Management program. Habitat Management Plan (HMP) - In 1990, the City led the state in early recognition of our natural resources when City Council approved a program for the City's biological resources. The Habitat Management Plan will provide policies and mechanisms for the protection of wildlife habitat, especially of endangered, threatened, or sensitive species. Completion of the biological inventory and analysis led to phase III in the HMP work program. Candidate preserve areas with Unking corridors were identified throughout the City. Coordination with other agencies and with City development policy documents continues. A draft plan should be presented to Council in late 1993 which is expected to lead to application for a Habitat Conservation Plan under the federal Endangered Species Act. Homeless Shelter - Homeless local farm workers now have temporary shelter at the La Posada de Guadalupe. The shelter is a cooperative project by Caring Residents of Carlsbad, Catholic Charities, and the City of Carlsbad. In addition to the 50-bed dormitory, a kitchen-dining hall, showers and laundry, and amnesty and immigration services are provided. Financial Statement Format This report is designed to provide both summarized and detailed information on the operation of each of the City's funds. The report is organized as follows: Financial Section - This section contains the combined or summarized financial statements for all funds as well as the notes to the financial statements. Supplemental Data - This section provides more detailed information on the activity within each fund including revenues, expendi- tures, changes in fund balances, comparisons to budget figures and other related data. Statistical Information - This section provides data on the City's fiscal activity over the past ten years including revenues, expenditures, debt, assessed value, and demographic information. Accounting System and Budgetary Control The City's accounting system is designed, around a few basic principles. (1) The City is not one single entity. It is the total of many entities, each with its separate function and legal restrictions on the use of resources. In the private sector, a corporation may have many "subsidiaries" which make up the parent corporation. In the public sector, a city government may have a variety of "funds" that provide the basis for separately recording the financial data related to a specific activity. A fund is an accounting entity with a complete set of self-balancing accounting records. Each fund has been established because of some restriction on the use of resources received by that fund. This report includes the transactions of all entities over which the City Council of the City of Carlsbad has authority (as defined by the Governmental Accounting Standards Board). (2) The City's accounting system operates on a modified accrual basis for all governmental and agency type funds. Governmental funds include the General, Special Revenue, Debt Service and Capital Projects Funds. A modified accrual system is one where a) revenues are recorded when received in cash; b) revenues are accrued when they are both measurable and collectable within the accounting period or soon enough after the end of the period to pay liabilities of the period; and c) expenditures, other than interest or long-term debt, are recorded when liabilities are incurred. (3) The proprietary fund types (the Enterprise and Internal Service Funds) use the accrual method of accounting. Revenues and expenses are recorded when earned or incurred, respectively. (4) 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 recordkeeping. 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 recordkeeping system. (5) Budgetary control is maintained through monthly reports on all revenue and expenditure accounts as well as quarterly 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 should not exceed budgeted figures. All appropriations expire at year end unless specifically carried into the new fiscal year by Council action. The Carlsbad Municipal Code requires that the Financial Management Director annually prepare a budget for the City Manager showing estimated revenues and expenditures. Total City Operations During 1992-93 the City staff of 483 full-time employees provided a complete range of City services to the 67,172 residents and many businesses in Carlsbad. Throughout most of its history, Carlsbad has had the benefit of working with revenues sufficient to meet anticipated expenditures; however, the 1990's show a reversal of this trend. Revenues stopped growing and state legislation resulted in new mandatory expenditures as well as the loss of revenues. Over the past three years, Carlsbad has made every effort to maintain service levels through the deferral of projects and the management of vacant staff positions. Although Carlsbad entered 1992-93 with a balanced budget, revenue estimates were revised downward after the State adopted its budget in September. General Fund and Redevelopment Agency were seriously impacted by the mandated transfer of property taxes to the State and recessionary influences significantly reduced development revenues. Budget reductions were accomplished by continuing the hiring freeze which allowed the filling of only the most necessary positions. Further reductions to maintenance, operating and capital equipment expenses were accomplished with minimal impacts on programs and service levels. The close of 1992-93 showed the results, with an excess of revenues over expenditures in all fund types except debt service. Spending on all City programs totaled $78.4 million, an increase of $1.3 million from 1992-93. The increase is primarily due to construction costs on several major capital projects. Revenues for 1992-93 totaled $82.6 million, an increase of about $800,000 or 1% more than last year's total of $81.8 million. The major factor for the revenue gain is the increase in water rates to recover escalating costs to purchase water. Carlsbad is entering 1993-94 in a fiscally sound position due to City Council's rapid response to decreasing revenues as a result of the recession and the continuing low level of development activity in 1992-93. The general outlook for the next five years will be challenging, matching a slower tax base growth with financial requirements to meet the demand for services. The following report summarizes the revenues and expenditures (or expenses) for the City of Carlsbad for the fiscal year ended June 30, 1993. Revenue from All Fund Types (in thousands) 1992-93 1991-92 1992-93 over (under) 1991-92 General Fund $39,709 $39,925 Special Revenue Funds 7,149 6,571 Debt Service Funds 2,083 2,461 Capital Projects Funds 9,174 9,483 Enterprise Funds1 17,895 16,723 Internal Service Funds1 6.570 6.640 TOTAL REVENUES $82.580 $81.803 (1) Includes operating and non-operating revenues Expenditures (or Expenses) All $(216) 578 (378) (309) 1,172 (70) $777 Fund Types (in thousands) 1992-93 1991-92 1992-93 over (under) 1991-92 General Fund Special Revenue Funds Debt Service Funds Capital Projects Funds Enterprise Funds1 Internal Service Funds1 TOTAL EXPENDITURES Change Change $36,752 5,421 4,657 8,275 17,355 5,978 $78,438 $39,230 4,325 3,975 6,455 17,064 6.083 $77.132 $(2,478) 1,096 682 1,820 291 C1051 $ 1,306 (6.3)% 25.3 17.2 28.2 1.7 (1.7) 1.7% (1) Includes operating and non-operating expenses General Governmental Functions The General Governmental function includes the operations of the General, Special Revenue, Debt Service and Capital Projects funds. During 1992-93 revenue from all Governmental funds totaled $58.1 million, a decrease of $300,000 from 1991-92; expenditures totaled $55.1 million, up $1.1 million from last year. A brief look at these numbers on a fund-by-fund basis is shown on the following pages. General Fund The City's General Fund is used to record all revenues and expenditures not specifically restricted by law or Council policy. Major sources of revenue include property tax, sales tax, licenses and permits, and charges for services. Categories of expenditures include police and fire services, libraries, parks, street maintenance, and administrative functions. The following table summarizes General Fund revenues by major category for 1992-93 and 1991-92: General Fund Revenues (in thousands) 1992-93 over % 1992-93 1991-92 ("under) 1991-92 Change Taxes $26,026 $26,424 $ (398) (1.5)% Licenses & Permits 1,725 1,729 (4) (0.2) State Subventions 2,702 2,489 213 8.5 Charges for Services 2,835 4,563 (1,728) (37.8) Fines & Forfeitures 232 313 (81) (25.8) Interest Income 2,094 2,152 (58) (2.6) Other 4.095 2.255 1.840 81.5 TOTAL $39.709 $39.925 $ C216) (0.5)% In 1992-93 the City of Carlsbad again felt the effects of the recession in its General Fund revenues which were down by $216,000 compared to 1991-92 revenues of $39.9 million. General Fund revenues were originally budgeted for 1992-93 at $42.1 million. Estimated revenues decreased to $39.7 million to incorporate State budget transfers and the continued recession. Actual receipts came in at the revised budget estimate and totaled $39.7 million. Major revenue categories are as follows: Property Tax Revenue - $12.6 million Property taxes decreased $900,000 from 1991-92. When the State adopted their budget for 1992-93, a reallocation of property taxes was mandated by the State. The reallocation diverted $1.2 million, or 9% of 1991-92 property tax 8 revenues, from the City to the State. Net assessed valuation rose from $5.9 billion in 1991-92 to $6.1 billion in 1992-93, a 2.6% increase. The increase in net assessed valuation was disappointing when compared to past year's double- digit increases. However, increased property values in combination with some new construction and resales, augmented property tax revenues by approximate- ly $300,000, partially offsetting the property tax transfer to the State. Sales Tax Revenue - $9.2 million Sales taxes increased $444,000 over 1991-92, with the primary reason for the increase due to the opening of the new Price Club in the fall of 1992. The City suffered declines in sales taxes generated by other market segments, particularly food markets, new auto sales and drug stores. Interest Income - $2.1 million Revenue generated by the City's investments declined $59,000 from 1991-92. The decrease is due to lower yields on investments which was partially offset by slightly higher General Fund cash balances. Vehicle License Fee Revenue - $2.4 million Revenue from vehicle license fees increased $300,000 this year. Vehicle license fees are paid to the State in lieu of a personal property tax on vehicles and distributed to the City based on total population. Some of the increase is attributable to the 2.3% City population increase, and some is due to a revenue shift from the State between property taxes and vehicle license fees. Transient Occupancy Tax Revenue - $3.1 million Transient occupancy tax (hotel room tax) revenues remained constant in 1992- 93. TOT revenue reflects the general economy's lower available discretionary income and reduced rates offered by many of the hotels and motels within the City. Development Related Revenues - $1.2 million Development related revenues are down $1.5 million from 1991-92. Much of the decrease is due to fewer engineering plan check and inspection fees and also includes several large fee refunds. Engineering fees occur early in the preliminary development planning stages with builders anticipating future construction. Development continues to move slowly through the process with only 69 residential building permits issued in 1992-93. Other Revenue - $4.1 million The $1.8 million increase in 1992-93 other revenue is primarily attributable Public Employees Retirement System (PERS) reimbursement of surplus funds and repayment of disaster costs from both federal and state agencies. Total General Fund expenditures are summarized in the following table: General Fund Expenditures (in thousands) 1991-93 over % Category 1992-93 1991-92 (under) 1991-92 Change General Government $4,998 $5,069 $ (71) (1.4)% Public Safety . 15,342 15,647 (305) (1.9) Community Development 6,648 7,324 (676) (9.2) Culture & Recreation 6,238 6,961 (723) (10.3) Maintenance & Utilities 3.526 4.229 (703) (16.6) TOTAL $36.752 $39.230 $(2.478) (6.3)% The City of Carlsbad adapted to the recession and corresponding declining revenues by decreasing expenditures. In order to insure that the General fund would end the year balanced, several actions were taken. First, the City revised its budget downward to compensate for diversion of revenues from the City to the State and to match expenses with lowered revenue estimates. With this budget action, departments voluntarily gave up $2.6 million in their budgets which included cutting 42 unfilled positions from the budget. Other budget reductions were accomplished by replacing only a few employees as vacancies occurred, reducing the use of consultants and closely monitoring other operating costs. In addition, certain street projects are now budgeted and paid directly from the Gas Tax Fund. Through this effort, the City was able to hold its General Fund expenditures down to $36.8 million. This equates to a 6.3% or $2.5 million decrease from 1991-92 expenditures. Other significant changes in expenditures were as follows: • Public Safety Spending on public safety programs totaled $15.3 million, down $305,000 or 2% from 1991-92. Police expenditures declined this year when the costs of the DARE program to combat drug use by elementary school children were shifted to the asset forfeiture fund. Additional savings were achieved by reallocating Police resources thus avoiding replacement of several officers. In spite of lower General Fund revenues, there has been no decrease in the level of service provided by the City's public safety departments. Community Development Community Development program spending decreased $676,000 or about 9%. Because of declining development, Community Development was able to utilize City staff instead of outside consultants for planning and engineering plan- checking and studies related to the General Plan update. Additional savings were achieved through employee attrition. 10 Culture and Recreation Culture and Recreation spending dropped $723,000 or over 10% from 1991-92, primarily due to cost-reduction measures in park operations and fee-supported recreation programs. Library expenditures declined 6% with no reduction in available services. Maintenance and Utilities Maintenance and Utilities decreased $703,000 or 16.6% from 1991-92. In 1992-93, major street maintenance programs are now funded directly through the Gas Tax Fund instead of transferring funds to the General Fund. The programs include street sweeping, curb, gutter and sidewalk cement repairs, and street overlay sealants. General Government Spending in general government and administrative programs decreased by $71,000, or 1.4% from 1991-92 because of Research staff reassignments, employee vacancies, and fewer citywide training programs. Special Revenue Funds The City's Special Revenue Funds, which account for the collection and use of special or restricted revenues, received $7.1 million in total revenue in 1992-93. This is an increase of $578,000 or almost 9% over last year. Revenues from taxes rose because Gas Tax funds are now in the Special Revenue category instead of Capital Projects. Intergovernmental revenues declined in 1992-93 as the City received fewer police asset forfeiture funds from the sale of seized assets related to drug activity; however, the City received additional federal funding of the low and moderate income housing programs. Special Revenue Funds Revenues (in thousands) 1992-93 over % Category 1992-93 1991-92 (under) 1991-92 Change Taxes $1,425 $ 317 $1,108 Intergovernmental 3,326 4,176 (850) Charges for Services 1,651 1,617 34 Interest Income 541 341 200 Other 206 120 86 TOTAL 11 Expenditures from the Special Revenue Funds support a wide variety of programs and projects. Some of the major uses of funds include: Public works programs such as street lighting, landscaping services for street trees and median maintenance. Cultural programs, including grants from the California Library Services Act and California Arts Council, and the Civic Arts program. Special programs such as the Police Asset Forfeiture program, Bilingual Library program, and Adult Literacy program. Welfare programs such as the HUD-sponsored Carlsbad Housing Authority rental assistance program and Senior Nutrition program. Special Revenue Funds Expenditures (in thousands) 1992-93 Over % Category 1992-93 1991-92 (under) 1991-92 Change General Government $ 475 $ 440 $ 35 Public Works 1,783 1,258 525 Welfare 2,711 2,287 424 Culture and Recreation 452 340 112 TOTAL $5.421 $4.325 $1.096 Spending in Special Revenue Funds totaled $5.4 million in 1992-93, an increase of $1.1 million or about 25% above 1991-92. Increased expenditures in the public works category reflect gas tax street expenditures now accounted for in Special Revenue Funds and higher expenditures in the channel maintenance special benefit district, while increased HUD housing allocations are shown under welfare. Debt Service Funds The City's Debt Service funds record the payment of interest and principal on the current portion of outstanding debt. At June 30, 1993, the total debt payable from non-enterprise sources, excluding obligations under capital leases, was $27.9 million, comprised of Parking Authority and Hosp Grove Certificates of Participation, College Boulevard 1915 Act Assessment District bonds and Redevelopment Tax Allocation bonds. 12 Debt Service Funds Revenues (in thousands) 1992-93 over % Category 1992-93 1991-92 (under) 1991-92 Change Taxes $1,745 $2,116 $(371) (17.5)% Interest 338 345 m (2.0) TOTAL $2.083 $2.461 $(378) (15.3)% Debt Service revenues totaled $2.1 million, a decrease of $378,000 from 1991-92. Surplus construction funds in the College Boulevard Assessment District allowed a decrease in required property owner payments. Debt Service Funds Expenditures (in thousands) 1992-93 over % Category 1992-93 1991-92 (under) 1991-92 Change Principal $1,645 $1,175 $470 40.0% Interest 2,755 2,800 (45) (1.6) Other 257 Q 257 - TOTAL $4.657 $3.975 $682 17.1% Debt related expenditures rose in 1992-93 when principal payments were made with surplus College Boulevard construction funds. The mandated Redevelopment Agency payment to the State is also shown under debt service expenditures. No general obligation bonds are outstanding at June 30, 1993. The 1967 Building Authority Revenue bonds, issued to construct City Hall, were retired in 1992-93. Capital Projects Funds Under the accounting definition used by the City, a capital project fund is one that accounts for the receipt and disbursement of monies that are restricted for the acquisition or construction of capital facilities (other than those financed by enterprise funds). Capital projects funds for the City of Carlsbad include those supported by the City's public facilities fees, community facilities district (Mello-Roos) taxes, park in-lieu (park development) fees, drainage fees, traffic impact fees, bridge and thoroughfare district fees, county sales tax funds, and general funds earmarked for capital purposes in the Capital Construction Fund. The capital projects supported by the City's Redevelopment Agency are also included in this group. 13 Capital Projects Funds Revenues , (in thousands) Category Taxes Intergovernmental Charges for Services Interest Other TOTAL 1992-93 $1,813 3,781 1,239 1,893 448 1992-93 Over % 1991-92 (under) 1991-92 Change $ 3,228 1,911 1,580 1,988 776 483 $(1,415) 1,870 (341) (95) (328) $(309) (43.8)% 97.8 (21.5) (4.7) (42.2) f3.2)% Revenue in the capital projects funds totaled $9.2 million, down $309,000 from last year. Taxes decreased by $1.4 million as gas tax revenues are now shown under Special Revenues. Revenues from neighboring cities for construction of a shared road and increased County sales taxes earmarked for City streets are reflected in higher intergovern- mental revenues. The continued downturn in new building construction is apparent by the decrease in charges for services and other revenues. Capital Projects Funds Expenditures (in thousands) Category General Government Capital Projects TOTAL 1992-93 $1,083 7.192 $8.275 1992-93 over 1991-92 (under) 1991-92 $ 815 5.640 $6.455 $ 268 1.552 Change 32.8% 27.5 28.1% Spending on capital projects totaled $8.3 million. Much of the $1.8 million increase is due to beginning construction on several major street projects. Fiscal year 1992-93 represents the ninth year of the City's major construction effort which has provided more than $122 million in improvements. Projects planned for 1993-94 could carry this trend into a tenth year with $26 million of new capital projects budgeted in the new year. The City Council continues to set a high priority on the construction of quality infrastructure improvements. Some of the key capital projects under construction or completed during this year include: Palomar Airport Road East and El Camino Real - Construction began to this vital circulation link in 1993. The project includes intersection improvements, road widening, bicycle lanes, and waterline expansion. These improvements 14 will upgrade a major circulation system through the industrial-commercial corridor and is a joint effort of Carlsbad and the neighboring cities of Vista and San Marcos. Freeway Interchanges - Expansion of the three Interstate 5 freeway interchanges will provide improved circulation at critical connection points to City streets. The Palomar Airport Road/I-5 interchange, built in cooperation with the state transportation agency (CALTRANS), is scheduled for completion in December, 1993. Preliminary design work continues on the La Costa Avenue freeway interchanges, with construction scheduled for the Poinsettia Avenue interchange in 1994. El Camino Real Road Widening and Road Medians - Improvements to this main north/south City thoroughfare have improved Citywide traffic circulation. In order to limit traffic disruptions and achieve cost savings, Carlsbad Municipal Water District improvements and road widening were done concurrently. Poinsettia Park - After development of the master plan for Poinsettia Park in phases, design work began in late 1992. The 30 acre park in the southwest quadrant of Carlsbad has extensive environmental and permit processing requirements. Final design is expected by calendar year-end with construction to begin mid-1994. Streetscape Phase V and Tamarack Avenue - Construction on Carlsbad Village Drive and Tamarack Avenue began in 1992-93. From the freeway, the roads provide access to the Pacific Ocean and into the Village area. Street widening, storm drain improvements, and undergrounding of utilities will enhance safety and further beautify City streets. Enterprise Operations The City of Carlsbad manages water, sewer, solid waste, and the proposed golf course as Enterprise Fund operations. An enterprise fund is one where most or all of the costs involved are supported by user fees. Within these funds the City uses many of the accounting practices applicable to commercial business including the recording of depreciation on fixed assets and the allocation of overhead costs from support services. User fees are set on an annual basis to cover both operating costs and debt service needs. The Carlsbad Municipal Water District (CMWD), established as a subsidiary district to the City in January 1990, is included as an enterprise fund of the City. CMWD and City operations were merged in 1992-93, with all district positions joining City employment. 15 Enterprise Funds Total Operating and Non-Operating Revenues (in thousands) Category CMWD Golf Course Sewer Solid Waste TOTAL 1992-93 $12,268 87 5,413 127 1991-92 $11,422 61 5,070 170 1992-93 over (under) 1991-92 $ 846 26 343 (431 % Change Revenue in the enterprise funds totaled $17.9 million, up $1.2 million over 1991-92. Most of the increase is due to a full year of higher sewer fees and an increase in the water rate necessitated by the increased cost of purchased water. Enterprise Funds Total Operating and Non-Operating Expenses (in thousands) Category CMWD Golf Course Sewer Solid Waste TOTAL 1992-93 $12,304 0 4,897 154 1992-93 over 1991-92 (under) 1991-92 $10,450 0 6,513 101 $17.064 $1,854 0 (1,616) 53_ $ 291 Change 17.7% Expenses in the Enterprise Funds totaled $17.4 million, up $291,000 over 1991-92. No golf course expenses are shown since all golf course payments were directly related to the construction of the proposed golf course and are included in construction in progress. The write off of an unused sewer plant last year is reflected in the reduced sewer expenses. The cost of purchased water, which increased 19% in 1992-93, and water inventory adjustments raised CMWD expenses over last year. During this same period the number of accounts provided with water and/or sewer service grew by only 1%, to 17,307. In 1989, the City joined with three other agencies to sell $33.5 million of sewer revenue bonds. These bond funds, along with funding from two additional agencies, have financed the expansion of the Encina Wastewater Facility, which was substantially completed as of June, 1993. The expanded facility should provide sufficient wastewater treatment capacity to the year 2005. Carlsbad's portion of the outstanding bonds is $12.7 million. 16 Internal Service Funds Internal Service Funds are used to account for services provided by a City department to other City departments. As with an Enterprise Fund, the source of revenue is user fees charged to the departments receiving the service. SELF-INSURANCE PROGRAM-WORKERS' COMPENSATION & GENERAL LIABILITY The City has been self-insured for Workers' Compensation since September 1978. The activity for this program is recorded in the Workers' Compensation Self-Insurance Internal Service Fund. Workers' compensation claims for 1992-93 amounted to $639,000 compared to $706,000 in 1991-92, a decrease of $66,000 or 9%. The decrease is attributable to a one-time refund from the insurance administrator, partially offset by higher claims. The estimated claims payable at year-end were $1 million, a $400,000 decrease from 1991-92. Total fund equity at June 30, 1993 is $1.3 million. The General Liability Self-Insurance Fund, was established near the end of 1980-81. Claims expense for 1992-93 totaled $1.1 million, up $144,000 from the 1991-92 total of $990,000. The increased claims expense is directly related to higher reserves set aside for further settlements. The estimated claims payable at year-end were $871,000, up $227,000. The City is a member of the California Municipal Insurance Authority risk- management pool which covers most losses exceeding $500,000, with catastrophic losses covered by additional excess liability insurance. Fund equity totaled $1.9 million at June 30, 1993. OTHER INTERNAL SERVICE FUNDS Fleet Management operates a central vehicle maintenance program which services all City vehicles and other small machinery. Replacement of vehicles, including fire equipment, is an important component of the program. Useful lives of vehicles have been extended over recent years as a cost savings measure; however, large vehicle purchases are planned for 1993-94. Although depreciation costs declined from prior year, total expenses were $1.7 million. Total fund equity at year-end was $5.2 million. The City also operates a health insurance internal service fund for collecting premiums, paying the insurance carrier, and holding reserve funds. At June 30, 1993, total health insurance fund equity totaled $1.4 million. The City's Data Processing internal service fund collects revenues and expenses related to the providing of data processing services to the City. At year-end, fund equity totaled $1.1 million. 17 •-- *"v Agency Funds The City uses Agency Funds to account for assets held by the City for other individuals, entities or governments. Typically these funds relate to contractors' cash performance bonds, employee payroll deductions, or deferred compensation accounts. The City held a total of $18.7 million in Agency Funds as of June 30, 1993, compared to $18.9 million at the end of 1991-92. The increase of $200,000 is due to the deposit of an additional $1.2 million into the City's deferred compensation plans, offset by a decrease of approximately $1 million in miscellaneous deposits. The decrease in miscellaneous deposits was mainly the result of the transfer of approximately $1.5 million in Public Employees Retirement System (PERS) surplus finds to the General fund. The litigation surrounding these funds was settled in 1992-93 allowing the City to record the funds as revenue this fiscal year. Cash Management The City Treasurer is charged with the responsibility of safeguarding the City's assets, receiving all payments due the City and investing all inactive funds. During this year the City Treasurer earned about $7.5 million in interest on investments in all fund types from instruments yielding up to 8.7%, compared to earnings of $7.6 million during 1991-92. Funds are invested in various types of instruments as shown below. At June 30,1993, the Treasurer had 100% of all available funds invested. The City's total portfolio at year-end was $131.5 million. Below is a summary of cash and investments outstanding as of June 30, 1993: Amount Invested Interest Rates Cin millions') Cash 0.00 - 3.59 $ 1.0 Other Deposits 4.52 - 9.12 71.3 Federal Agency Notes 5.00 - 8.70 19.8 Treasury Issues 5.66 - 6.93 6.3 Corporate Notes 5.50 - 8.66 33.0 Miscellaneous Investments 0.00 - 4.00 0.1 As required by State law, the City Council adopted a comprehensive investment policy specifying the type and term of City investments. This policy has allowed the City Treasurer flexibility without endangering the safety, liquidity or yield of the total portfolio. 18 In 1979, Proposition 4, the "Gann" initiative, was passed. The purpose of this law is to limit government spending by putting a cap on the total proceeds of taxes that may be appropriated each year. This limit is increased each year through a formula that takes into consideration changes in the Consumer Price Index and state per-capita income. When a city reaches this limit excess tax revenue must be returned to the State or citizens through a process of refunds, rebates, or other means that may be defined at that time. The Gann limit for the City of Carlsbad has increased steadily since 1979 and still provides the City with a comfortable operating margin. In 1991-92 state law allowed the recalculation of the City's limit with new inflation factors. Using population growth in San Diego County and growth in State per capita income allowed the Gann limit for 1992-93 to increase to $66 million. Appropriations of "proceeds of taxes" was only $35.6 million, thus allowing the City a healthy margin of $30.4 million. CITY OF CARLSBAD PROPOSITION 4 SPENDING LIMIT VS. APPROPRIATION OF PROCEEDS OF TAXES MILLIONS OF DOLLARS $70 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 RSCAL YEAR OF TAXES D SPENDING LIMIT 19 Economic Outlook The general outlook for Carlsbad over the next few years is hazy due to the lingering recession and the threat of additional State actions which may further reduce the City's revenue base. Current state and regional economic forecasts show a slow recovery with continued depressed levels of construction spending over the next several years, especially in the commercial/industrial area. A moderate and sustained national recovery, and a pickup in California homebuilding, which had been counted upon to stabilize the California economy, have failed to materialize. As demonstrated during the past year, the recession has dramatically impacted the City's ability to improve or increase programs provided to its citizens despite the continuing demand for such services. Actual spending in the General Fund was reduced by $5.3 million from originally budgeted amounts, and capital equipment outlay was essentially eliminated. Our capital improvement program budgeted $32 million in expenditures for 1992-93, however only $8 million was spent. Since sufficient funds are not available at this time, the 1992-93 capital program calls for a number of deferred or phased projects. Despite the setbacks caused by the recession and the State's budget balancing strategies, the long-term outlook for Carlsbad is still very optimistic. The City's long range capital improvement program anticipates the construction of more than $400 million in improvements between now and buildout. This program includes new parks, libraries, fire stations, streets, water and sewer lines, and other facilities to maintain the level of service offered to the Carlsbad resident. This aggressive construction program will place a burden on the operating budget that must be managed through careful scheduling to match demands with resources. Uncontrolled demand would easily out-pace the City's ability to pay for services. The City's Growth Management Program holds the key to the timing of many of the developments that will support the City through fees and taxes. This program is designed to insure that new development occurs in conjunction with careful planning of infrastruc- ture and service needs. The expansion of retail sales facilities, the addition of new auto dealerships, major discount warehouse outlet, several small commercial centers, and continued plans for the construction of a group of major shopping centers as well as the construction of a major hotel in southern Carlsbad are expected to provide the much needed tax base to finance the growing service needs. Further, future commercial/industrial development in the Palomar Airport Industrial Park area will add to Carlsbad's economic health. The City continues to support its tourist industry with financial support to the Chamber of Commerce Convention and Visitors Bureau. Realizing that the Pacific Ocean beaches play an important role, Council continues to appropriate funds to keep the state beach parking free to all beach users and is considering constructing additional restroom facilities. 20 The update of the City's entire General Plan began in 1992 with town hall meetings and community forums held to receive input from all sectors of the public. The public review continues with a revised General Plan expected to come before Council in 1994. In addition, City staff completed a comprehensive fiscal analysis of the Carlsbad General Plan which forecasts the financial stability of the City. This program provides a tool to evaluate financial implications of current and future City policies and decisions. Staff will be updating this program in conjunction with the General Plan and presenting the results to Council in the future. Certificate of Award for Outstanding Financial Reporting The California Society of Municipal Finance Officers (CSMFO) presented a Certificate of Award for Outstanding Financial Reporting to the City of Carlsbad for its comprehensive annual financial report for the fiscal year ended June 30, 1992. The Certificate is valid for one year only. The City has received the award from 1985. We believe our current report continues to conform to the program requirements. Acknowledgments This report has been a joint effort by many people from many different areas of responsibility. The dedicated efforts of Cheryl Allen, Assistant Finance Director, and all of the accounting staff, deserve full credit for the preparation and contents of this report. We appreciate Karen Walz and Dean Votava of Conrad & Associates for the professional way in which the audit of this financial report: was conducted. It has been a pleasure to work with the Conrad & Associates staff throughout this period. Respectfully submitted, USA HILDABRAND Finance Director 21 FAUBROOK CARLSBAD ESCONDOO RAMONA LA JOUA SAN OKO CORONAOCT IMPERIAL BEACH RATIONAL CITY CHUA VISTA 22 CTIY OF CARLSBAD ELECTED CITY OFFICIALS Claude A. Lewis, Mayor Margaret Stanton, Mayor Pro Tern Ramona Finnila, Council Member Ann J. Kulchin, Council Member Julianne Nygaard, Council Member Aletha L. Rautenkranz, City Clerk James M. Stanton, City Treasurer ADMINISTRATION AND DEPARTMENT HEADS Raymond R. Patchett, City Manager Frank Mannen, Assistant City Manager James F. Elliott, Financial Management Director Martin Orenyak, Community Development Director Ron Ball, City Attorney Ralph Anderson, Utilities & Maintenance Director David Bradstreet, Parks and Recreation Director Ruth Fletcher, Purchasing Officer Michael Holzmiller, Planning Director Lloyd Hubbs, City Engineer Ann Jensen, Human Resources Director Clifford Lange, Library Director Dennis Van Der Maaten, Fire Chief Robert Vales, Police Chief CHAIRPERSONS, COMMISSIONS AND BOARDS Sue Ladouceur Arts Commission Sally Vigil Beach Erosion Committee Stuart Turgel Cable Television Foundation Julie Baker Child Care Commission Tom Erwin Citizens Committee to Study Growth Peggy Savary Design Review Board Marjorie Howard-Jones Historic Preservation Commission Edward Scarpelli Housing Commission Claude A. Lewis Housing and Redevelopment Commission Richard Martin Library Board Richard Goodman Parking Authority David Castner Parks and Recreation Commission Camille Mitkevich Personnel Board Tom Erwin Planning Commission George Heard Senior Citizen Commission Emmett J. Woodward, Jr. Serra Cooperative Library System Advisory Board Dennis Brandmeyer Sister City Committee John Fuller Traffic Safety Commission Richard Allen Underground Utility Advisory Committee John Henley Water Commission 23 r r • PARKING . AUTHORITY . ' CABLE TELEVISION ' . FOUNDATION . I PARKSAND RECREATION I COMMISSION I I -HIT-. I I SENIOR CITIZEN ' j COMMISSION ." ' ARTS ' ~. COMMISSION . ' LIBRARY BOARD ' . OF TRUSTEES . ' SISTER CITY ' • COMMITTEE . J PERSONNEL . ~j BOARD - r L J h- -, r r 1 I COMMISSION " ii H I l I | L_ I I ~l' OPEN SPACE ' COMMITTEE I CITIZENS' I COMMITTEE TO I STUDY GROWTH I ' PLANNING ' COMMISSION I DESIGN I REVIEW I BOARD IMAYOR & COUNCIL CITY TREASURERCITY CLERK . COMMISSION . I BEACH I EROSION COMMITTEE I COMMISSION CITY MANAGER CITY ATTORNEY i v-firiiMLaaiv/ii • ASSISTANT TO CITY MANAGER I HISTORIC I PRESERVATION 1 I COMMISSION I I ASSISTANT CITY MANAGER FINANCIAL MGMT. DIR. COMMUNITY DEVEL. DIR. CARLSBAD MUNICIPAL WATER DISTRICT HUMAN RESOURCES ENGINEERING RISK MANAGEMENT HOUSING AND REDEVELOPMENT INFORMATION SYSTEMS PARKS AND RECREATION UTILITIES AND MAINTENANCE COUNCIL APPOINTED BOARDS AND COMMISSIONS COUNCIL APPOINTED CITY OF CARLSBAD ORGANIZATION CHART STAFF SUPPORT REPORTING RELATIONSHIP DEPARTMENTS BOARDS, COMMISSIONS AND COMMITTEES Arts Commission Beach Erosion Committee Ln Design Review Board Historic Preservation Commission Parking Authority Parks and Recreation Commission Serra Cooperative Library System Advisory Board Sister City Committee VOTERS CITY COUNCIL Cable Television Foundation Housing Commission Personnel Board Traffic Safety Commission Child Care Commission Housing and Redevelopment Commission Planning Commission Underground Utility Advisory Committee Citizens Committee to Study Growth Library Board Senior Citizens Commission Water Commission 26 CERTIFIED PUBLIC ACCOUNTANTS A PARTNERSHIP INCLUDING PROFESSIONAL CORPORATIONS 1100 MAIN STREET. SUITE C IRVINE. CALIFORNIA 92714 (714) 474-2020 The Honorable Members of City Council City of Carlsbad, California INDEPENDENT AUDITORS' REPORT We have audited the accompanying general purpose financial statements of the City of Carlsbad, California as of and for the year ended June 30, 1993, as listed in the table of contents. These general purpose financial statements are the responsibility of the management of the City of Carlsbad, California. Our responsibility is to express an opinion on these general purpose financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the general purpose financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the general purpose financial statements referred to above present fairly, in all material respects, the financial position of the City of Carlsbad, California as of June 30, 1993, and the results of its operations and the cash flows of its proprietary fund types for the year then ended in conformity with generally accepted accounting principles. Our audit was made for the purpose of forming an opinion on the general purpose financial statements taken as a whole. The combining, individual funds, and individual account group financial statements and schedules listed in the table of contents are presented for purposes of additional analysis and are not a required part of the general purpose financial statements of the City of Carlsbad, California. Such information has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion, is fairly stated in all material respects in relation to the general purpose financial statements taken as a whole. The scope of our audit did not include the supplemental statistical schedules listed in the table of contents and we do not express an opinion on them. October 8, 1993 27 MEMBERS OF AICPA AND CALIFORNIA SOCIETY OF CERTIFIED PUBLIC ACCOUNTANTS MEMBER OF AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS PRIVATE COMPANIES PRACTICE SECTION CITY OF CARLSBAD Combined Balance Sheet All Fund Types and Account Groups June 30, 1993 Governmental Fund Types Assets and Other Debits Assets: Cash and investments (note 3) Deferred compensation investments (note 16) Receivables: Loans Taxes Accounts, net Special assessments Other Accrued interest Due from other funds (note 4) Due from other governments Advances to other funds (note 5) Inventory Prepaid expenditures Restricted assets: Cash and investments (note 3) Accrued interest Property, plant and equipment, net (notes 6 and 7) Other debits: Amount available in debt service funds Amount to be provided for retirement of general long-term debt Total assets and other debits Liabilities. Equity and Other Credits Liabilities: Accounts payable Accrued wages payable Accrued interest payable Due to other funds (note 4) Advances from other funds (note 5) Due to other governments Estimated claims payable Assessments payable Current portion of long-term debt (note 10) Deposits payable Deferred compensation payable (note 16) Current liabilities payable from restricted assets - accrued interest payable Deferred revenue Bonds payable (note 10) Special assessment debt with governmental commitment (note 10) Obligations under capital leases (notes 8 and 10) Certificates of participation (note 10) Installment purchase agreement (note 10) Total liabilities Equity and Other Credits: Investment in general fixed assets Contributed capital (note 12) Fund balance: Reserved (note 11) Unreserved (note 11) Retained earnings: Reserved (note 11) Unreserved (note 11) Total equity and other credits Total liabilities, equity and other credits General Special Revenue Debt Service Capital Projects $11,812,855 9,679,325 4,481,481 37,523,712 -657,373 102,262 -435,040 409,400 242,168 6,107 10,804,846 27,672 114,864 28,640 27,527 - -146,866 -61,450- - _ 52,137 -7,290,000 -68,036 -_ -- -6,780 40,000_ -484,531 -70,908 1,700,000 - 194,372 J24.497.723 10.253.044 11.891.654 39.825.931 1,316,448 15,158 13,655 12,504,846 841,067 $984,645 1,960.233 -_ 195,943 70,723 228,513 830 150 3,718,739 7,290,000 98,716 6.663.767 496.009 7.290.000 14.789.890 7,727,395 3,628,889 4,599,029 10,106,561 6,128,146 2,625 17.833.956 9.757.035 4.601.654 S24.497.723 10,253.044 11.891.654 8,179,392 16,856,649 25.036.041 39.825.931 See accompanying notes to general purpose financial statements. 28 Proprietary Fund Types Enterprise Internal Service Fiduciary Fund Type Agency Account Groups General Fixed Assets General Long-term Debt Totals (Memorandum Onlvl 33,575,974 10,385,970 11,640 2,574,530 6,601 530,621 161,393 204,657 229,596 97,061 5,401,732 6,938 100,353,463 2,758,206 12,779,240 5,905,967 58,964 142.889.151 13.409.231 18.744.171 63,017,773 63.017.773 4,301,654 24.442.634 28.744.288 120,238,557 5,905.967 114,864 756,570 2,750,920 7,290,000 435,040 1,859,811 446,825 138.465 12,504,846 354,329 194.372 5,401,732 6,938 166,129,442 4,301,654 24.442.634 353.272.966 1,255.701 310,850 204,657 1.004,630 272.659 486,820 2,070,778 10,319,479 12.029.445 297,494 45,678 2,212.424 2,047 378,620 4,219,611 8,237.926 5,905,967 27.955.019 2.555.596 18.744.171 12,460,000 7,580,000 874,288 7,830,000 28.744.288 4,052,278 2,402,642 378,620 446,825 12,504,846 830 2,212,424 4,219,611 1,004,630 9,351.802 5,905,967 486,820 13.178,233 12,460,000 7.580,000 874,288 18,149,479 12.029.445 107.238.740 79,628,166 6,471,940 3,917,220 31.388.746 4.381.695 114.934.132 10.853.635 63,017,773 63.017.773 63,017,773 86,100,106 24,134,705 33,093,981 3.917,220 35.770.441 246.034.226 142.889.151 13.409.231 18.744.171 63.017.773 29 28.744.288 353.272.966 30 CITY OF CARLSBAD *.j. -,-> Combined Statement of Revenues, Expenditures and Changes in Fund Balances - All Governmental Fund Types Year Ended June 30, 1993 Special Debt Capital Totals General Revenue Service Projects (Memorandum Only) Revenues: Taxes $26,025.646 1,424.846 1,744,551 1,812,440 31,007,483 Licenses and permits 1,724,773 - 1,724,773 Intergovernmental 181,367 3,326.055 - 3,781,254 7,107,385 State subventions 2,702,102 - 2,702,102 Charges for services 2,835,535 1,651,524 - 1,238,538 5,725,597 Fines and forfeits 231,877 - 231,877 Interest income 2,093,659 540,808 338,463 1,893,431 4,866,361 Interdepartmental services 2,100,985 - 2,100,985 Contributions from property owners - 380,389 380,389 Miscellaneous 1.813.384 206.226 - 67.612 2.268.513 Total revenues 39.709.328 7.149.459 2.083.014 9.173.664 58.115.465 Expenditures: Current: General government 4,997,887 474,434 - 1,083,032 6,555,353 Public safety 15,341,646 - 15,341,646 Community development 6,648.158 - - - 6,648,158 Public works - 1,783,124 - - 1,783,124 Welfare - 2,711,467 - - 2,711,467 Culture and recreation 6,237.793 448,317 - - 6,686,110 Maintenance and utilities 3,526,214 - 3,526,214 Capital outlay - 3,425 - 7,192,002 7,195,427 Debt service: Principal retirement - - 1,645,000 - 1,645.000 Interest and fiscal charges - - 2,754,613 - 2,754,613 State mandated payment - - 257.278 - 257.278 Total expenditures 36.751.698 5.420.767 4.656.891 8.275.034 55.104.390 Excess (deficiency) of revenues over (under) expenditures 2.957.630 1.728.692 (2.573.877) 898.630 3.011.075 Other financing sources (uses): Operating transfers in 76 3,170 2,346,126 1,626,036 3.975,408 Operating transfers out (1,040,551) - (76) (2,934,781) (3,975,408) Grant repayment - (507,451) - - (507,451) Administrative 'fee receivedfrom bond refunding - 36.616 - - 36.616 Total other financing sources (uses) (1.040.475) (467.665) 2.346.050 (1.308.745) (470.835) Excess (deficiency) of revenues and other financing sources over (under) expenditures and other financing uses 1,917,155 1,261,027 (227,827) (410,115) 2,540,240 Fund balances at beginning of year, as restated (note 22) 16,809,073 8,549,508 4,904,027 26,642,420 56,905,028 Residual equity transfers in 146,928 - - 10,979 157,907 Residual equity transfers out (1.039.200) (53.500) (74.546) (1.207.243) (2.374.489) Fund balances at end of year S17.833.9S6 9.757.035 4.601.654 25.036.041 57.228.686 See accompanying notes to general purpose financial statements. 31 CITY OF CARLSBAD Combined Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual (Budgetary Basis) - All Governmental Fund Types Year Ended June 30, 1993 General Fund Revenues: Taxes Licenses and permits * Intergovernmental State subventions Charges for services Fines and forfeits Interest income Interdepartmental services Miscellaneous Total revenues Budget $27,025,000 2,150,000 2,600,000 3,619,300 375,000 1,700,000 1,900,000 306.435 39.675.735 Actual on Budgetary Basis 26,025,646 1,724,773 181,367 2,702,102 2,835,535 231,877 2,093,659 2,100,985 1.813.384 39.709.328 Variance- Favorable (Unfavorable) (999,354) (425,227) 181,367 102,102 (783,765) (143,123) 393,659 200,985 1.506.949 33.593 Expenditures: Current: General government Public safety Community developmentPublic worksWelfareCulture and recreation Maintenance and utilities Capital outlay Debt service: Principal retirement Interest and fiscal charges State mandated payment Total expenditures Excess (deficiency) ofrevenues over (under) expenditures Other financing sources (uses):Operating transfers inOperating transfers outGrant repayment Administrative fee received from bond refunding Total other financing soures (uses) Excess (deficiency) of revenues and other financing sources over (under) expenditures and other financing uses Fund balances at beginning of year, as restated (note 22) Residual equity transfers in Residual equity transfers out Fund balances at end of year 6,748,066 15,621,261 7,344,024 6,398,227 3.934,721 16.809,073 $15.398.034 5,169,167 15,416.781 6,881,126 6,260,123 3,655,064 40.046.299 37.382.261 (370.564) 2.327.067 76 76 (1,040,551) (1,040,551) (1.040.475) (1.040.475) (1,411,039) 1,286,592 16,809,073 146,928 (1.039.200) 17.203.393 1,578,899 204,480 462,898 138,104 279,657 2.664.038 2.697.631 2,697,631 146,928 (1.039.200) 1.805.359 See accompanying notes to general purpose financial statements. 32 Special Revenue Funds Budeet 1,275,000- 3,087,821 - 1,674,986- 178,700- 76.000 6,292,507 675,047 -- 3,460,722 2,792,861 781,062 -3,425 Debt Service Funds Totals (Memorandum Onlv) Actual on Variance- Actual on Variance- Actual on Budgetary Favorable Budgetary Favorable Budgetary Basis (Unfavorable) Budeet Basis (Unfavorable) Budeet Basis 1,424,846- 3,326,055- 1,651,524 -540,808- 206.226 7.149.459 648,849 -- 3,020,449 2,711,467 635,408 -3,425 149,846 -238,234 -(23,462) -362,108 -130.226 856.952 26,198- -440,273 81,394 145,654- - 1,600.000 1,322,061 (277,939) 29,900,000 28,772,553 - - - 2,150,000 1,724,773 - - - 3,087,821 3,507,422 2,600,000 2,702,102 - - - 5,294,286 4,487,059 375,000 231,877 60,000 121,515 61,515 1,938,700 2,755,982 - - - 1,900.000 2,100,985 - - - 382.435 2.019.610 1,660.000 1.443.576 (216.424) 47.628.242 48.302.363 7,423,113 5,818,016 - 15,621,261 15,416,781 - - - 7,344,024 6,881,126 - - - 3,460,722 3,020,449 - - - 2,792,861 2,711,467 - - - 7,179,289 6,895,531 - - - 3,934,721 3,655,064 - - - 3,425 3,425 Variance- Favorable (Unfavorable) (1,127,447) (425,227) 419,601 102,102 (807,227) (143,123) 817,282 200,985 1.637.175 674.121 1,605,097 204,480 462,898 440.273 81,394 283,758 279,657 - 290,000 290,000 847,939 1,329,644 (481,705) 257.278 257.278 - 290,000 290,000 847,939 1,329,644 (481,705) 257.278 257.278 - 7.713.117 7.019.598 693.519 1.395.217 1.876.922 (481.705) 49.154.633 46.278.781 2.875.852 (1.420.610) 129.861 1.550.471 3,170 3,170 (507,451) (507,451) 36.616 36.616 - (467.665) (467.665) 264.783 (433.346) (698.129) (1.526.391) 2.023.582 3.549.973 464,061 464,061 - 467,307 367,307 (1,040,551) (1,040,551) - - - (507,451) (507,451) 464.061 464.061 36.616 36.616 (1.044.079) (1.044.079) (1,888,275) (337,804) 1,550,471 8,549,508 8,549,508 (53.500) (53.500) 728,844 30,715 (698,129) (2,570,470) 979,503 3,549,973 1,757,057 1,757,057 6.661.233 8.158.204 1.496.971 2.485.901 1.787.772 27,115,638 27,115,638 146,928 146,928 (1.092.700) (1.092.700) 24.545.168 27.149.369 2.604.201 33 CITY OF CARLSBAD v Combined Statement of Revenues, Expenses and Changes in Retained Earnings - All Proprietary Fund Types Year Ended June 30, 1993 Operating revenues: Water sales Sewer service charges Other charges for services Contributions from other government agencies Miscellaneous Total operating revenues Enterprise $ 9,844,421 4,382,889 482,895 75,794 191.672 Internal Service 5,551,478 474.589 Totals (Memorandum Only) 9,844,421 4,382,889 6,034,373 75,794 666.261 14.977.671 6.026.067 21.003.738 Operating expenses: Plant operations Purchased water Depreciation and amortization Fuel and supplies Claims expense General and administrative Total operating expenses Operating income (loss) Nonoperating revenues (expenses): Interest income Interest expense and fees Gain (loss) on sale of property Property taxes Miscellaneous income Amortization of issuance costs Total nonoperating revenues Net income Retained earnings at beginning of year Residual equity transfers out Retained earnings at end of year 1,608,483 6,137,022 2,254,800 5.597.156 2,086,155 (1,706,887) 8,566 758,231 58,524 (44.243) 1.160.346 540,556 533,396 457,019 3,598,129 1.372.346 15.597.461 5.960.890 (619.790) 65.177 543,692 (17,346) 526.346 591,523 34,821,409 3,790,172 (55.999) - $35.305.966 4.381.695 1,608,483 6,137,022 2,788,196 457,019 3,598,129 6.969.502 21.558.351 (554.613) 2,629,847 (1,706,887) (8,780) 758,231 58,524 (44.243) 1.686.692 1,132,079 38,611,581 (55.999) 39.687.661 See accompanying notes to general purpose financial statements. 34 CITY OF CARLSBAD Combined Statement of Cash Flows- All Proprietary Fund Types Year Ended June 30, 1993 Internal Totals Enterprise Service (Memorandum Only) Cash flows from operating activities: Operating income (loss) $ (619,790) 65,177 (554,613) Adjustments to reconcile operating income (loss) to net cash provided by operating activities: Depreciation and amortization 2.254,800 533,396 2,788,196 Decrease (increase) in receivables (335,066) (155) (335,221) Decrease (increase) in inventory 213,913 (15,430) 198,483 Increase (decrease) in deposits payable 33,664 - 33,664 Increase (decrease) in accounts payable 334,472 235,930 570,402 Increase (decrease) in accrued wages payable 26,245 (799) 25,446 Increase (decrease) in estimated claims payable - 126.2781 (26.2781 Net cash provided by operating activities 1.908.238 791.841 2.700.079 Cash flows from noncapital financing activities: Transfer to other funds (55.9991 - (55.9991 Cash flows from capital and related financing activities: Purchases of property, plant and equipment (2,966,954) (297,258) (3,264,212) Principal payment on bonds (685,000) - (685,000) Interest and other fees paid on bonds (2,111,915) - (2,111,915) Property taxes received 758,231 - 758,231 Capital contributions received 1.446.062 530.000 1.976.062 Net cash provided by (used in) capital and related financing activities (3.559.5761 232.742 (3.326.8341 Cash flows from investing activities: Investment in restricted assets 1,182,436 - 1,182,436 Interest on investments 2.153.522 527.506 2.681.028 Net cash provided by investing activities 3.335.958 527.506 3.863.464 Net increase in cash and cash equivalents 1,628,621 1,552,089 3,180,710 Cash and cash equivalents at beginning of year 31.947.353 8.833.881 40.781.234 Cash and cash equivalents at end of year 33.575.974 10.385.970 43.961.944 Supplemental schedule of noncash investing and financing activities S 2.753.202 370.548 3.123.750 See accompanying notes to general purpose financial statements. 35 36 CITY OF CARLSBAD Notes to General Purpose Financial Statements Year Ended June 30, 1993 (1) Summary of Significant Accounting Policies The City of Carlsbad, California (Carlsbad) was incorporated on July 16, 1952. Carlsbad operates under a Council-Manager form of government and provides the following services: general government, public safety, community development, public works, culture, and recreation. Carlsbad is not subject to federal or state income taxes. The accounting policies of Carlsbad and its component units conform to generally accepted accounting principles as applicable to governmental units. The following is a summary of the more significant policies: (a) Description and Scope of the Reporting Entity The Comprehensive Annual Financial Report includes all entities for which Carlsbad exercises oversight responsibility as defined by the National Council on Governmental Accounting (NCGA) Statement No. 3 "Defining and Reporting Entity." This responsibility includes, but is not limited to, the authority to govern, manage, approve budgets, and assume fiscal accountability. The financial statements of the reporting entity (the City) include the financial activities of Carlsbad, the Housing Authority of the City of Carlsbad, the Parking and Building Authorities of the City of Carlsbad, the City of Carlsbad Public Improvement Corporation, the Carlsbad Redevelopment Agency and the Carlsbad Municipal Water District (the District). Their financial operations are closely related and the City Council has a continuing oversight responsibility over these entities. The oversight responsibility is determined on the basis of budget adoption, taxing authority, funding and appointment of the governing board. The City also has an interest in a joint sewage treatment facility known as the Encina Water Pollution Control Facility and in a financing authority known as the Encina Financing Joint Powers Authority. Since the City does not have significant influence over the management or the operation of these entities, they have not been included as component units in the City's financial statements. (b) Basis of Presentation 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, fund balance/retained earnings, revenues, and expenditures or expenses. The various funds and account groups are summarized by type in the financial 37 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (1) Summary of Significant Accounting Policies. (Continued) statements. Fund types and account groups used by the City are as follows: GOVERNMENTAL FUND TYPES: Governmental funds are used to account for the City's expendable financial resources and related liabilities (except those accounted for in proprietary and similar trust funds). The measurement focus is based upon determination of changes in financial position. The following are the City's governmental fund types: General Fund The general fund is the general operating fund of the City. It is used to account for all financial resources except those required to be accounted for in another fund. Special Revenue Funds Special revenue funds are used to account for revenues derived from specific sources (other than major capital projects) that are restricted by law or administrative regulation to expenditures for specific purposes. Debt Service Funds Debt service funds are used to account for the accumulation of resources for, and payment of, general long-term debt principal, interest and related costs. Capital Projects Funds Capital projects funds are used to account for financial resources to be used for the acquisition or construction of major capital facilities other than those financed by proprietary funds. PROPRIETARY FUND TYPES: Proprietary funds are used to account for activities that are similar to those found in the private sector. The measurement focus is based upon determination of net income and capital maintenance. The following are the City's proprietary fund types: 38 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (1) Summary of Significant Accounting Policies. (Continued) Enterprise Funds Enterprise funds are used to account for operations (a) that are financed primarily through user charges, or (b) where the governing body has decided that determination of net income is appropriate. Internal Service Funds Internal Service funds are used to account for goods or services provided by one department to other departments of the City on a cost-reimbursement basis. FIDUCIARY FUND TYPE: Fiduciary funds are used to account for assets held by the City in a trustee capacity or as an agent for individuals, private organizations, other governmental units, and/or other funds. The following is the City's fiduciary fund type: Agency Funds Agency funds are used to account for assets held by the city in an agency capacity for individuals and private businesses. They do not involve measurement of results of operations. ACCOUNT GROUPS: Account groups are used to establish accounting control and accountability for the City's general fixed assets and general long-term debt. The following are the City's account groups: General Fixed Assets Account Group This account group is used to account for all fixed assets of the City other than those accounted for in the proprietary funds. General Long-term Debt Account Group This account group is used to account for all long-term obligations of the City except those accounted for in the proprietary funds and trust funds. 39 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (1) Summary of Significant Accounting Policies. (Continued) (c) Measurement Focus and Basis for Accounting Governmental 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 provides an indication of available, spendable resources. Operating statements for governmental fund types report increases (revenues) and decreases (expenditures) in available, spendable resources. The proprietary fund types are accounted for on an "income determination" or "cost of services" measurement focus. Accordingly, all assets and liabilities are included on the balance sheet, and the reported fund equity provides an indication of the historical net worth of the fund. Operating statements for proprietary fund types report increases (revenues) and decreases (expenses) in total historical net worth. Fiduciary fund types are custodial in nature (assets equal liabilities) and do not involve measurement of results of operations. Fiduciary fund assets and liabilities are accounted for on the modified accrual basis of accounting. Governmental fund types use the modified accrual basis of accounting. Revenues are recognizable when susceptible to accrual, i.e., both measurable and available. Available means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. In applying the susceptible to accrual concept to intergovernmental revenues, the legal and contractual requirements of the individual programs are used as guidance. Revenues that are accrued include real property taxes, sales tax, interest, and some state and federal grants. Real property taxes are levied on October 15 against owners of record at March 1. The taxes are due in two installments, on November 1 and February 1, and become delinquent after December 10 and April 10, respectively. Tax liens attach annually as of 12:01 a.m. on the first day of March in the fiscal year for which the taxes are levied. Under the provisions of NCGA Interpretation 3, property tax revenue is recognized in the fiscal year for which the taxes have been levied, provided it is collected within 60 days of the end of the fiscal year. 40 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (1) Summary of Significant Accounting Policies. (Continued) Governmental expenditures are recorded when the related fund liability is incurred. Principal and interest on general long-term debt are recorded as fund liabilities when due or when amounts have been accumulated in the debt service fund for payments to be made early in the following year. Proprietary funds use the accrual basis of accounting, i.e., revenues are recognized in the period earned and expenses are recognized in the period incurred. (d) Encumbrances Encumbrance accounting, under which purchase orders, contracts and other commitments for the expenditure of monies are recorded in order to reserve that portion of the applicable appropriation, is employed as an extension of formal budgetary control in the governmental funds. Encumbrances outstanding at year-end do not constitute expenditures or liabilities, but are reported as reservations of fund balance. (e) Cash and Investments Cash includes amounts in demand and time deposits. Investments are stated at cost or amortized cost, except for deferred compensation assets which are shown at market value. The City maintains a cash and investment pool that is available, for use by all funds. Interest income earned as a result of pooling is allocated to the appropriate funds based on average monthly cash balance. (f) Inventories Inventories consist of materials and supplies that are valued at cost and are recorded as expenses on a first-in, first-out basis when consumed. (g) Compensated Absences Vacation pay is payable to employees at the time used or upon termination of employment. For governmental funds, the cost of accumulated vacation expected to be paid in the next 12 months is recorded as a fund liability and amounts expected to be paid after 12 months (if any) are recorded in the general long-term debt account group. For compensated absences recorded at June 30, 1993, all balances are expected to be paid within the following 12 months. For proprietary funds, the cost of vacation is recorded as a liability when earned. 41 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (1) Summary of Significant Accounting Policies. (Continued) (h) Risk Management The City accounts for its general liability, health insurance, and workers' compensation activities in internal service funds. The funds are responsible for collecting premiums from other City funds and departments and paying claims settlements and insurance premiums. Interfund premiums are based on the insured fund's claims experience. Incurred but not reported claims are accrued at year-end if material. (i) Unbilled Services Unbilled water revenue of the enterprise funds is recognized as earned when the water is consumed. (j) General Fixed Assets General fixed assets are recorded as expenditures in the governmental fund types and capitalized at historical cost in the general fixed assets account group. In the case of gifts or contributions, such assets are recorded at fair market value at the time received. 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, the objective of stewardship for capital expenditures is satisfied without recording these assets. In the general fixed assets account group, construction in progress is transferred to buildings or improvements upon approval by the City Council, which approximates the completion date. No depreciation has been provided on general fixed assets, (k) Property. Plant and Equipment - Proprietary Funds Property, plant and equipment used by proprietary funds is stated at cost or estimated historical cost. Contributed fixed assets are recorded at estimated fair market value at the time received. Net interest costs are capitalized on projects during the construction period. 42 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (1) Summary of Significant Accounting Policies. (Continued) Depreciation is charged to operations using the straight-line method based on the estimated useful life of the related asset. The estimated useful life of the assets are as follows: Years Buildings and improvements 10 - 50 Wells, reservoirs and dams 10 - 100 Transmission and distribution lines 40 - 70 Sewer, sewer lines and wells SO Sewage treatment facility 55 Filters, pumps and fire hydrants 10 - 50 Equipment 3-20 (1) Deferred Revenue The deferred revenue in the General Fund represents interest due, but not available, on advances to other funds. The deferred revenue in the Debt Service Funds represents special assessments receivable. The deferred revenue in the Capital Projects Funds relates to funds received and to be applied toward future construction. The deferred revenue in the Enterprise Funds relates to deposits or in-kind prepayments for services to be rendered (e.g., sewer installation, etc.). (m) Statement of Cash Flows - Proprietary Funds For purposes of the statement of cash flows, the Proprietary Funds consider all highly liquid investments with an original maturity of three months or less when purchased and all amounts invested in a cash and investment pool to be cash equivalents. (n) Advances to Other Funds Interfund loan receivables are reported as advances and are offset equally by a fund balance reserve which indicates that they do not constitute expendable available financial resources and therefore are not available for appropriation. 43 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (1) Summary of Significant Accounting Policies. (Continued) (o) Residual Equity Transfers Residual equity transfers represent non-routine transfers of equity between funds, including amounts transferred to reflect the opening, closing, or reclassification of funds. (p) Total Columns Total columns on the combined statements are captioned "Memorandum Only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position, results of operations, or cash flows in conformity with generally accepted accounting principles. Such data is not comparable to a consolidation since interfund eliminations have not been made. (2) Budgetary Data The City follows these procedures in establishing its budgetary data: 1. During May or June, the City Manager submits to the City Council a proposed operating budget for the fiscal year commencing the following July 1. The budget includes proposed expenditures and estimated revenues on a departmental basis. 2. Public hearings are conducted at City Council meetings to obtain citizens' comments during June. 3. Prior to July 1, the budget is enacted legally through passage of an appropriation resolution. The City Manager is authorized to make transfers of appropriated amounts within a fund for up to $25,000. Revisions that alter the total appropriations of any fund must be approved by the City Council. A mid-year budget review is conducted each year. Any major changes to the adopted budget are approved by the City Council at that time. During the year, several supplementary appropriations were necessary. Budgets for governmental type funds are adopted on the modified accrual basis, except that encumbrances are treated as budgeted expenditures in the year purchases are committed. 44 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (2) Budgetary Data. (Continued) Expenditures may not exceed budgeted appropriations at the departmental level. All appropriations lapse at fiscal year-end unless City Council takes formal action in the form of a resolution to continue the appropriation into the following fiscal year. For purposes of budgetary presentation, actual generally accepted accounting principles (GAAP) expenditures have been adjusted to include encumbrances outstanding and designations for continuing appropriations at year-end. Annual budgets are adopted for the General, Special Revenue and Debt Service Funds except for the following: Mortgage Revenue Bonds, Building Authority, College Boulevard, Hosp Grove COP's, and Parking Authority. Accordingly, the revenues and expenditures for these funds have been excluded from the budget basis financial statements. Annual budgets are not adopted for the Capital Projects Funds; therefore, budget basis financial statements have not been prepared because a comparison of such budgetary amounts to annual revenues and expenditures is not meaningful. The following schedule is a reconciliation of the budgetary and GAAP fund balances: Special Debt General Revenue Service Fund Funds Funds Fund balances-budgetary basis $17,203,393 8,158,204 1,787,772 Encumbrances outstanding at year-end 482,616 1,000,274 Fund balances designated for continuing appropriations 147,947 598,557 Fund balances of nonbudgeted funds - - 2.813.882 Fund balances - GAAP basis $17.833.956 9.757.035 4.601.654 (3) Cash and Investments Each participating fund's portion of the City's cash and investment pool is displayed on the combined balance sheet as "Cash and investments." This category also includes cash and investments that are held separately by several of the City's funds. 45 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (3) Cash and Investments. (Continued) Authority for Deposits and Investments: The City's investment policy and state statutes authorize the City to invest in obligations of the U.S. Treasury, its agencies and instrumentalities, commercial paper rated A-l by Standard and Poor's Corporation or P-l by Moody's Commercial Paper record, banker's acceptances with a maximum maturity of 270 days, repurchase agreements, certificates of deposit with national and state licensed or chartered banks or federal or state savings and loan associations, medium-term corporate notes with a maximum five-year maturity rated in the three top rating categories, money market and mutual funds whose portfolios consist of one or more of the foregoing investments, the County Treasurer's investment pool, and the State Treasurer's investment pool. State statutes require that all deposits be insured or collateralized. Depositories holding public funds on deposit are required to maintain collateral in the form of a pool of government securities with a market value of at least 10 percent in excess of the City's deposit or 50 percent in excess of the deposit as collateral in mortgage pools. Cash and investments held by the City at June 30, 1993 consisted of the following: Cash on hand (petty cash) $ 6,173 Deposits 1,306,051 Investments 130.234.032 $131.546.256 Cash and investments are classified in the accompanying combined balance sheet as follows: Cash and investments $120,238,557 Deferred compensation investments 5,905,967 Restricted assets: Cash and investments 5.401.732 $131.546.256 Deposits: The following summary presents the amount of the City's deposits which are fully insured or collateralized with securities held by the City or its agent in the City's name (Category One), those deposits which are collateralized with securities held by the pledging financial institution's trust department or agent in the City's name (Category Two), and those deposits which are not collateralized or are 46 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (3) Cash and Investments. (Continued) collateralized with securities held by the pledging financial institution or its trust department or agent but not in the City's name (Category Three) at June 30, 1993. Category Bank Carrying Form of Deposit 1 2 3 Balance Amount Demand deposits $1(52,556 - 1,351,087 1,513,643 1,045,051 Certificates of deposit 100.000 _= 161.000 261.000 261.000 Total deposits $262.556 - 1.512.087 1.774.643 1.306.051 Investments; The City categorizes investments according to the level of risk assumed by the City. Catetory One includes investments that are insured, registered or held by the City's agent in the City's name. Category Two includes uninsured and unregistered investments held by the counterparty's trust department or agent in the City's name. Category Three includes uninsured and unregistered investments held by the counterparty, its trust department or its agent, but not in the City's name. Certain investments have not been categorized because securities are not used as evidence of the investment. These uncategorized investments include ownership interests in the Local Agency Investment Fund, County Treasury Investment Pool and mutual funds and similar instruments. The summary below identifies the level of risk assumed by the City and the total carrying amount and market value of the City's investments. Category Carrying Market Form of Investment 1 2 3_ Amount Amount U.S. Government agency obligations $19,827,961 1,549,526 - 21,377,487 22,150,525 U.S. Treasury securities 6,322,937 309,346 - 6,632,283 7,019,302 Corporate notes 32.997.840 - - 32.997.840 34.350.815 $59.148.738 1.858.872 - 61,007,610 63,520,642 State investment pool (LAIF) 30,793,383 30,793,383 County investment pool 20,826,131 20,826,131 Guaranteed investment contracts 1,382,394 1,382,394 Mutual funds 16.224.514 16.224.514 Total investments $130.234.032 132.747.064 47 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (4) Due To and From Other Funds The following table shows amounts due from funds within the City to other funds within the City at June 30, 1993: Due to Due from: Special Revenue Funds: Section 8 Housing Authority Fund Senior Nutrition Fund Capital Projects Funds: Community Development Block Grants Fund Enterprise Funds: Carlsbad Municipal Water District (CMWD) Total General Fund $215,019 13,494 13,655 $242.168 Enterprise Sewer Fund 204.657 204.657 Totals 215,019 13,494 13,655 204.657 446.825 (5) Advances To and From Other Funds The following table shows amounts advanced from funds within the City to other funds within the City at June 30, 1993: Advances From General Fund Capital Projects Funds: Capital Construction Fund Advances To Capital Projects Funds: Park Development Fund Planned Local Drainage Facilities Fund Redevelopment Area II Fund Redevelopment Project Fund Capital Projects Funds: Public Facilities Construction Fund Traffic Impact Fund Total advances Amount $ 2,550,000 300,000 30,000 7.924.846 10.804.846 950,000 750.000 1.700.000 $12.504.846 48 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (6) General Fixed Assets A summary of changes in the general fixed assets account group is as follows: Balance at Balance at July 1. 1992 Additions Deletions June 30. 1993 Land $25,946,668 Buildings 26,664,097 741,039 Improvements 2,055,632 763,812 Furniture and equipment 5,305,004 468,662 Construction in progress 3.064.803 380.490 Total $63,03^204 2.354.003 Construction in progress in the general fixed assets a following: Project Authorization Library - South Carlsbad $1,138,729 Public Art - South Carlsbad Library 170,000 Poinsetta Park 3,087,000 Poinsetta Park Land Acquisition 100,000 Larwin Park (22.3 acres) 190,000 Public Art - Seawall 30,000 North Beach Rest rooms 18,000 Fire Station #1 Renovation 175.000 (867,460) (1.504.974) f 2. 372. 434 > ccount group is Expended Balance at June 30. 1993 1,099,803 75,656 491,282 81,069 173,331 15,000 3,689 489 25,946,668 27,405,136 2,819,444 4,906,206 1.940.319 63.017.773 composed of the Committed 38,926 94,344 2,595,718 18,931 16,669 15,000 14,311 174.511 $4.908.729 1.940.319 2.968.410 There is no future financing commitment required on any of the above noted construction projects. (7) Property. Plant and Equipment - Proprietary Funds A summary of proprietary fund type property, plant and equipment at June 30, 1993 follows: 49 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (7) Property. Plant and Equipment - Proprietary Funds. (Continued) Enterprise Internal Service Land, water rights, rights-of-way $ 2,157,600 Buildings and improvements 5,817,620 Wells, reservoirs and dams 17,324,132 Transmission and distribution lines 32,301,912 Sewer, sewer lines and wells 25,602,381 Sewage treatment facility 31,698,579 Equipment and vehicles 2,165,301 5,240,437 Construction in progress 3.636.981 - 120,704,506 5,240,437 Less accumulated depreciation (20.351.043) (2.482.231) Property, plant and equipment, net $100.353.463 2.758.206 Enterprise Fund interest is charged to expense as incurred, except for interest related to borrowings used for construction, which is capitalized net of interest earned on construction funds borrowed. Interest capitalization ceases when the construction project is substantially complete and placed in service. No interest costs were capitalized in the Enterprise Funds during 1993. Total interest costs incurred and interest earned on related interest-bearing investments acquired with proceeds of the tax-exempt borrowings were $1,686,990 and $227,106, respectively. The Enterprise funds had various construction contracts in progress at June 30, 1993 with an estimated cost to complete of approximately $2,725,000. There is no future financing required on any of these projects. (8) Obligations Under Capital Leases In August 1987, the City entered into a sale and leaseback agreement with a financial institution for the Community Development Building. Principal and interest payments totaling $234,529 are to be paid each year through 1997. The City's leasehold interest of $1,602,160 has been recorded in the City's general fixed asset account group. The following is a summary by year of future minimum lease payments remaining under capital leases and the present value of minimum lease payments at June 30, 1993: 50 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (8) Obligations Under Capital Leases. (Continued) Year ending June 30. 1994 $ 234,529 1995 234,529 1996 234,529 1997 234,529 1998 117.264 Total minimum lease payments 1,055,380 Less amounts representing interest (181.092) Present value of minimum lease payments $ 874.288 (9) Obligations Under Operating Leases In June 1988, the City's Redevelopment Agency entered into an agreement to lease a parking lot from a private party. The lease requires monthly rental payments for twenty years. Total annual rent payments are $44,091 for fiscal year ending June 30, 1994 with annual cost of living adjustments required and market value adjustments required every 5 years after fiscal year ending June 30, 1988. The future minimum rental payments have been calculated with a 6% annual cost of living adjustment. In May 1990, the City's Redevelopment Agency entered into an agreement to lease a parking lot on Carlsbad Village Drive from a private party. The lease requires annual rental payments for five years. Total annual payments are $52,200 for fiscal year ending June 30, 1994 and $43,500 for fiscal year ending June 30, 1995. The following is a schedule by year of future minimum rental payments required under the operating leases at June 30, 1993: Year ending June 30. 1994 $ 96,291 1995 90,236 1996 49,541 1997 52,513 1998 55,664 Thereafter 111.111 Total minimum lease payments $1.121.962 51 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (10) Long-term Debt The following is a summary of changes in the principal balance of long-term debt for the year ended June 30, 1993: Principal Principal Balance at Balance at July 1. 1992 Retirements June 30. 1993 General long-term debt account group: Bonds $12,960,000 500,000 12,460,000 Special assessment debt with governmental commitment 8,465,000 885,000 7,580,000 Obligations under capital leases 1,030,622 156,334 874,288 Certificates of participation 8.090.000 260.000 7.830.000 Total general long-term debt $30.545.622 1.801.334 28.744.288 Enterprise funds: Certificates of participation $12,055,000 685,000 11,370,000 Installment purchase agreement 12.689.800 - 12.689.800 Total enterprise funds $24.744.800 685.000 24.059.800 Long-term debt at June 30, 1993 is comprised of the following issues: Balance at June 30. 1993 General Long-term Debt: 1969 Carlsbad Parking Authority Revenue Bonds, principal due in amounts ranging from $100,000 to $125,000 on October 1 of each year through 1995, interest payable on October 1 and April 1 at 6.4% per annum, payable from the General Fund $ 350,000 1981 Carlsbad Parking Authority Revenue Bonds, principal due in amounts ranging from $100,000 to $150,000 on February 1 of each year through 2001, interest payable on August 1 and February 1 at 8.0% per annum, payable from the General Fund 925.000 Parking authority revenue bonds 1.275.000 52 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (10) Long-term Debt. (Continued) Balance at June 30. 1993 General Long-term Debt. (Continued): 1988 Carlsbad Housing and Redevelopment Commission Tax Allocation Bonds, principal due in amounts ranging from $305,000 to $595,000 on April 1 of each year through 2003, a principal payment of $2,890,000 on April 1, 2007, and a principal payment of $3,950,000 on April 1, 2011, interest payable on October 1 and April 1 at rates varying from 5.9% to 7.8% per annum 11.185.000 Total bonds payable 12,460,000 1986 College Boulevard Assessment District Bonds, principal due in amounts ranging from $290,000 to $865,000 on September 2 of each year through 2006, interest payable on September 2 and March 2 at rates varying from 7.25% to 8.0% per annum 7,580,000 Obligations under capital leases (note 8) 874,288 1988 Hosp Grove Certificates of Participation, principal due in amounts ranging from $275,000 to $815,000 on August 1 of each year through 2008, interest payable on August 1 and February 1 at rates varying from 6.0% to 8.0% per annum 7.830.000 Total General Long-term Debt $28.744.288 Enterprise Fund Long-term Debt: 1988 Carlsbad Municipal Water District Certifi- cates of Participation, principal due in vary- ing amounts ranging from $730,000 to $1,425,000 on May 1 of each year through 2004, interest payable on May 1 and November 1 each year at rates varying from 6.4% to 7.3% per annum $11,370,000 Encina Financing Joint Powers Authority (EFJPA) Installment Purchase Agreement, principal due in varying amounts ranging from $274,630 to $1,049,276 on August 1 of each year from 1994 through 2014, interest payable on February 1 and August 1 each year at rates varying from 6.0% to 6.875% per annum 12.689.800 53 24,059,800 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (10) Long-term Debt. (Continued) Enterprise Fund Long-term Debt. (Continued): Less unamortized discount and issuance costs Less current portion Total Enterprise Fund Long-term Debt Balance at June 30. 1993 (706,246) H. 004.630) $22.348.924 Reserve funds of approximately $5,130,000 are required to be held in debt service funds to secure the payment of principal and interest on the outstanding debt issues. A portion of the Tax Allocation Bonds are subject to mandatory redemption in part from sinking fund payments. These sinking fund payments have been included in the debt service requirements which follow. Debt service requirements to maturity for general long-term debt are as follows: Parking Tax Assessment Certificates Authority Allocation District of Revenue Bonds Bonds Bonds Participation Total 1994 1995 1996 1997 1998 1999-2003 2004-2008 2009-2011 $293,200 303,000 287,000 150,000 167,000 466,000 - - 1,135,828 1,142,222 - 1,146,598 1,148,522 1,148,062 5,806,054 5,876,260 3.567.180 876,643 898,350 897,107 898,413 901,929 4,500,265 3,603,200 - 865,054 866,873 866,733 859.795 860,985 4,284,040 4,256,800 851.600 3,170,725 3,210,445 3,197,438 3,056,730 3,077,976 15,056,359 13,736,260 4.418.780 1,666,200 20,970,726 12,575,907 13,711,880 48,924,713 Less amounts represent ing interest (391.200) (9.785.7261 (4.995.907) (5.881.880) (21.054.7131 Total general long-term debt 3il.27S.000 11.185.000 7.580.000 7.830.000 27.870.000 54 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (10) Long-term Debt. (Continued) Debt service requirements to maturity for the enterprise funds are as follows: Water District Certificates of Participation 1994 1995 1996 1997 1998 1999-2003 2004-2008 2009-2013 2014-2015 Less amounts representing interest Total Enterprise Fund debt $ 1,528,696 1,526,248 1,525,098 1,524,822 1,524,982 7,629,380 1,529,024 16,788,250 (5.418.250) $11.370.000 Encina Installment Purchase Agreement 1,110,706 1,108,498 1,108,730 1,107,542 1,106,820 5,522,606 5,492,250 5,452,970 2.170.425 Total 2,639,402 2,634,746 2,633,828 2,632,364 2,631,802 13,151,986 7,021,274 5,452,970 2.170.425 24,180,547 40,968,797 (11.490.747) (16.908.997) 12.689.800 24.059.800 At June 30, 1993, the City was in compliance with all significant debt covenants. In November 1988, the District issued $14,370,000 in Certificates of Participation. A portion of the proceeds was used to refund $12,000,000 of the outstanding 1984 Certificates of Participation (1984 COPs). The District deposited funds in an irrevocable trust with an escrow agent to provide for all future debt service payments on the 1984 COPs. As a result, the 1984 COPs are considered to be defeased and the liability for those certificates is not included in the City's financial statements. At June 30, 1993, $9,850,000 of outstanding 1984 COPs are considered defeased. The College Boulevard Assessment District Bonds were issued under the provisions of the Improvement Bond Act of 1915. The bonds were issued to finance the public infrastructure improvements project on College Boulevard. If a delinquency occurs in the payment of the assessment installments, the City, at the end of the fiscal year 55 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (10) Long-term Debt. (Continued) of delinquency, has a duty to transfer to the debt service fund the amount of the delinquency out of available funds of the City. Available funds consist of any surplus funds of the City not required for lawful municipal obligations. This duty of the City is continuing during the period of delinquency, until reinstatement, redemption or sale of the delinquent property. Even though neither the faith and credit nor the taxing power of the City is pledged for the payment of the bonds, the City is obligated in the manner stated above. Accordingly, these bonds have been recorded in the general long-term debt account group of the City. The College Boulevard Assessment District has delinquencies in the amount of $450,784 for assessments due in fiscal years 1990-91, 1991-92, and 1992-93. Although the delinquencies are 20% of the total assessment, only one major property owner is delinquent and all principal and interest payments were made without use of the reserve fund. The City's suit to foreclose on the property, which was delayed because of bankruptcy actions, is expected to occur in 1994. (11) Fund Balances/Retained Earnings The following is a summary of reserved and unreserved fund balances and retained earnings as of June 30, 1993: Fund Balances Reserved for: Loans receivable Inventory Prepaid expenditures Debt service Advances to other funds Low and moderate income housing Rent interruption insurance Encumbrances Unreserved: Designated for approved capital projects Designated for continuing appropriations Designated for arbitrage Designated for Aerospace/PERS settlement Undesignated Total fund balances Governmental Fund Types General 27,672 7,086,107 147,947 825,000 9.133.614 10.106.561 S17.833.9S6 56 Special Revenue 114,864 194,372 131,000 482.616 7.727.395 2,319,379 1.000.274 3.628.889 121,400 598,557 5.408.189 6.128.146 Debt Capital Service Projects 4,599,029 1,700,000 6.479.392 4.599.029 8.179.392 2,625 19,790,307 (2.933.658) 2.625 16.856.649 9.757.035 4.601.654 25.036.041 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (11) Fund Balances/Retained Earnings. (Continued) Retained Earnings Reserved for: Debt service Rate stabilization and other Unreserved Total retained earnings Proprietary Fund Types Internal Enterprise Service $ 3,039,148 878.072 3,917,220 31.388.746 4.381.695 $35.305.966 4.381.695 Reserves for loans receivable, inventory, prepaid expenditures and advances to other funds, net of accrued interest recorded as deferred revenue, are established to show that certain assets are already committed to other purposes and are not available for discretionary expenditures. Reserves for debt service represent resources legally restricted to the payment of long-term debt principal and interest maturing in future years. Reserves for low and moderate income housing represent monies required to be expended on low and moderate income housing. Reserves for rent interruption insurance represents monies required to be set aside under a bond indenture. Reserves for encumbrances represent commitments related to unperformed contracts for services and undelivered goods. Reserves for rate stabilization and other represent amounts restricted to offset future water rate increases and other uses. Unreserved-undesignated represents the fund balance or retained earnings remaining after reduction for reserved and designated fund balances or retained earnings. As of June 30, 1993, the Capital Projects - Redevelopment Agency Fund and Redevelopment Area II Fund had a deficit fund balance of $7,873,619 and $13,214, respectively. The deficits are expected to be funded by property tax increments received in the future. The General Liability Self Insurance Fund had deficit retained earnings of $18,769. 57 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (12) Changes in Contributed Capital Internal Enterprise Service Contributed capital at June 30, 1992 $75,487,426 5,571,402 Additions: Cash 822,338 Fixed assets 2,753,202 370,538 Residual equity transfer from General Fund 565,200 474,000 Residual equity transfer from Enterprise Fund - 55.999 Contributed capital at June 30, 1993 $79.628.166 6.471.939 (13) Risk Management The City is exposed to various risks of loss related to theft of, damage to, and destruction of assets; errors and omissions; injuries to employees; and natural disasters. Effective January 1, 1991, the City became a participating member of the California Municipal Insurance Authority (CMIA) risk-management pool. Under this program, the pool provides coverage for up to a maximum of $5,000,000 per claim with a self-insured retention to be provided by the City in the amount of $500,000 per claim. In addition, excess general liability insurance coverage up to $10,000,000 is provided for catastrophic losses. Under the terms of the agreement with CMIA, the City must maintain an unencumbered portion of fund equity equal to $1,500,000. At June 30, 1993, unencumbered fund equity for the General Liability Self-Insurance Fund was approximately $1,900,000. (14) Joint Ventures Encina Water Pollution Control Facility: The Encina Water Pollution Control Facility (the Facility) is a sewer system owned jointly by the Cities of Carlsbad and Vista, the Leucadia County Water District, the Buena Vista Sanitation District, the Vallecitos Water District (formerly the San Marcos County Water District) and the Encinitas Sanitary District. The Encina Wastewater Authority (the Authority) is the operator and administrator of the facility and is responsible for the management, maintenance and operations of the joint system. Ownership percentages are determined by joint agreement at the time the assets are acquired. As of June 30, 1993, the Cities and Districts have the following approximate ownership interest: 58 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (14) Joint Ventures. (Continued) Encina Water Pollution Control Facility. (Continued) City of Carlsbad 25% City of Vista 33 Leucadia County Water District 16 Vallecitos Water District 16 Encinitas Sanitary District 5 Buena Vista Sanitation District 5 The latest available financial statements of the Authority, dated June 30, 1992, show the following: Total assets $125,229,321 Total liabilities 3.801.377 Fund balance $121.427.944 The Authority does not recognize net income or loss. Net operating expenditures in excess of users' assessments are treated as accounts receivable on the Authority's books and charged to users' accounts in the following year. Conversely, users' assessments in excess of net operating expenditures are treated as a liability and credited against users' accounts, also in the following year. Under this basis, net operating revenues for the Authority totaled $1,117,243 in fiscal year 1992. The City accounts for its portion of the Facility as a fixed asset of the Sewer Enterprise Fund. Encina Financing Joint Powers Authority. The Encina Financing Joint Powers Authority (the Authority) was created on February 1, 1989 between the City of Carlsbad, the City of Vista, the Buena Vista Sanitation District and the Leucadia County Water District. The primary purpose of the Authority is to issue revenue bonds in order to finance the expansion of the Facility. Repayment of the bonds will be accomplished through payments made by each member of the Authority pursuant to installation purchase agreements. The individual agreements set forth the purchase price and specify the debt service requirements for each member. 59 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (14) Joint Ventures. (Continued) Encina Financing Joint Powers Authority. (Continued) The Authority is governed by a Board of Directors, which consists of one director appointed by each member. In August 1989, the Authority issued $33,500,000 of revenue bonds and executed installment purchase agreements for approximately the same amount. The following is a table of the outstanding balance owed as of June 30, 1993 by each member and their approximate share in the additional capacity. Installment Approximate balance share Buena Vista Sanitation District $ 6,614,895 19.75% City of Carlsbad 12,690,917 37.88% Leucadia County Water District 7,965,181 23.78% City of Vista 6.229.007 18.59% $33.500.000 100.00% The installment balances are secured by a pledge of the revenues from each member's wastewater system, net of a deduction for maintenance and operating costs. Covenants within the agreements require the members to, among other things, (1) maintain insurance on the facility, and (2) establish wastewater rates which are sufficient to pay the operating costs and debt service on the bonds and which will result in net revenues equal to at least 1.1 times the annual installment payments due. The City's share in the accounts of the Authority is recorded in the Sewer Enterprise Fund. The expansion of the Facility is shown as an addition to the fixed assets of the Sewer Enterprise Fund. (15) Retirement Plan The City contributes to the California Public Employees Retirement System (PERS), an agent multiple-employer public employee retirement system that acts as a common investment and administrative agent for participating public entities within the State of California. For the year ended June 30, 1993, the payroll for employees covered by the PERS was $21,161,192. Total payroll for the same period was $23,678,357. 60 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (15) Retirement Plan. (Continued) All full-time employees are eligible to participate as members of PERS. Benefits vest after an employee has been a member of the plan for five years. Employees are eligible to retire after ages 50 to 60 with 5 years of credited service. Annual retirement benefits are determined based on age at retirement, the length of membership service and the amount of earnings based on the highest twelve consecutive months average. The PERS also provides death and disability benefits. These benefit provisions and all other requirements are established by state statute. Employees are required to make contributions ranging from 7 to 9 percent of gross pay. The City is required to contribute the remaining amounts necessary to fund the benefits for its members, using the actuarial basis recommended by the PERS actuaries and actuarial consultants and adopted by the PERS Board of Administration. The employee contributions are made by the City on behalf of the employees. The amount shown below as the "pension benefit obligation" (PBO) is a standardized disclosure measure of the present value of the pension benefits, adjusted for the effects of projected salary increases and step-rate benefits, estimated to be payable in the future as a result of employee service to date. The measure is intended to help users assess the funding status of the PERS on a going-concern basis, assess progress made in accumulating sufficient assets to pay benefits when due, and make comparisons among employers. The measure is the actuarial present value of credited projected benefits, and is independent of the funding method used to determine contributions to the PERS. The PBO was computed as part of actuarial valuations performed as of June 30, 1991. Significant actuarial assumptions used in the valuation include (a) a rate of return on the investment of present and future assets of 8.75 percent a year compounded annually (8.5 percent as of June 30, 1990), (b) projected salary increases of 4.5 percent a year compounded annually (5 percent as of June 30, 1990), attributable to inflation, (c) additional projected salary increases of 2.5 percent (2.75 percent for Carlsbad's safety employees) a year (2 percent as of June 30, 1990 for all employees), attributable to seniority/merit, and (d) no post-retirement benefit increases. The impact on current year contributions from changes in actuarial assumptions is not available. The total unfunded (assets in excess of) pension benefit obligation applicable to Carlsbad and District employees was $2,895,291 and $(27,431), respectively, at June 30, 1992 (the date of the latest actuarial valuations) is as follows: 61 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (15) Retirement Plan. (Continued) Carlsbad District Total Pension benefit obligation: Retirees and beneficiaries currently receiving benefits and terminated employees not yet receiving benefits $20,174,435 1,191,629 21,366,064 Current employees: Accumulated employee contributions including allocated investment earnings 14,098,275 705,489 14,803,764 Employer financed-vested 18,079,652 - 18,079,652 Employer financed-nonvested 1.519.415 - 1.519.415 Total pension benefit obligation 53,871,777 1,897,118 55,768,895 Net assets available for benefits at cost 50.976.485 1.924.549 52.901.034 Unfunded (assets in excess of) pension benefit obligation $ 2.895.292 (27.431) 2.867.861 The market value of the net assets available for benefits as of June 30, 1992 was $57,501,475 and $2,170,891 for Carlsbad and the District, respectively. Of the total change in the PBO for Carlsbad and the District from the prior year, none of the changes resulted from changes in benefit provisions or actuarial assumptions. PERS uses the Entry Age Normal Actuarial Cost Method which is a projected benefit cost method. It takes into account those benefits that are expected to be earned in the future as well as those already accrued. According to this cost method, the normal cost for an employee is the level amount which would fund the projected benefit if it were paid annually from date of employment until retirement. PERS uses a modification of the Entry Age Cost Method in which the employer's total normal cost is expressed as a level percentage of payroll. PERS also uses the level percentage of payroll method to amortize any unfunded actuarial liabilities. The amortization period of the unfunded actuarial liability ends on June 30, 2000. 62 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (15) Retirement Plan. (Continued) The significant actuarial assumptions used to compute the actuarially determined contribution requirement are the same as those used to compute the pension benefit obligation, as previously described. The actuarially determined employer and employee contributions applicable to the City at June 30, 1993, based on an actuarial valuation as of June 30, 1991, were as follows: Carlsbad Miscellaneous Safety Employees Employees Covered Covered Contributions Payroll Contributions Payroll Required normal cost contribution $2,031,676 14.92% 1,798,689 23.84% Amortization of the unfunded actuarial accrued liability 89.690 .66% 309.365 4.10% Total required contributions $2.121.366 15.58% 2.108.054 27.94% Actual employer contributions 1,183,724 8.70% 1,435,293 19.02% Contributions made by the City on behalf of employees 937.642 6.88% 672.761 8.92% Total actual contributions $2.121.366 15.58% 2.108.054 27.94% The following is a three-year trend information which gives an indication of the progress made in accumulating sufficient assets to pay benefits when due: 63 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (15) Retirement Plan. (Continued) Net assets available for benefits as a percentage of pension benefit obligation Unfunded (assets in excess of) pension benefit obligation as a percentage of annual covered payroll Actuarially determined employer contributions as a percentage of annual covered payroll Carlsbad District 1992 1991 1990 1992 1991 1990 94.6% 93.2% 93.9%101.4% 105.6% 13.0% 17.2% 15.8% 12.4% 10.8% 10.8% 106.4% (7.3)% (8.5)% 7.5% 2.4% Ten-year trend information is not currently available from the California Public Employees Retirement System; therefore, only the available information is presented. Required Supplementary Information Analysis of Funding Progress (Unaudited) Carlsbad Actuarial Valuation as of June 30 1987 1988 1989 1990 1991 1992 Net Assets Available for Benefits, at Cost $23,855,500 28,385,300 32,905,600 38,955,507 44,473,550 50,976,400 Pension Benefit Obi i eat ion 26,158,700 30,249,400 35,221,700 41,495,649 47,736,607 53,871,700 Percentage Funded 91.2% 93.8% 93.4% 93.9% 93.2% 94.6% Unfunded Pension Benefit Obi i eat ion 2,303,200 1,864,100 2,316,100 2,540,142 3,263,057 2,895,300 Annual Covered Payroll 12,147,900 13,170,000 15,378,600 16,071,500 18,983,745 22,249,000 Unfunded Pension Benefit Obligation as a Percentage of Annual Covered Payroll 19.0% 14.2% 15.1% 15.8% 17.2% 13.0% 64 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (15) Retirement Plan. (Continued) Required Supplementary Information Analysis of Funding Progress, Continued (Unaudited) District Actuarial Valuation as of June 30 Net Assets Available for Benefits, at Cost Pension Benefit Obligation Percentage Funded Unfunded Pension Benefit Obligation Annual Covered Payroll Unfunded Pension Benefit Obligation as a Percentage of Annual Covered Payroll 1987 1988 1989 1990 1991 1992 $ 823,110 981,451 1,217,447 1,463,415 1,705,889 749,880 941,218 1,141,723 1,374,798 1,616,014 1,924,540 1,897,110 109.8% 104.3% 106.6% 106.4% 105.6% 101.4% 73,230 40,233 75,724 88,617 89,875 27,430 825,380 960,250 1,026,090 1,047,044 1,229,551 - 8.9% 4.2% 7.4% 8.5% 7.3% (16) Deferred Compensation Plan The City offers its employees a deferred compensation plan created in accordance with Internal Revenue Code Section 457. The plan, available to substantially all full-time employees, permits them to defer a portion of their salary until future years. Amounts deferred may not exceed the lesser of $7,500 or 25% of a participants' "includable compensation," as defined in the participation agreement. The deferred compensation is not available to employees until termination, retirement, death or unforeseeable emergency. All amounts of compensation deferred under the plan, all property and rights purchased with those amounts, and all income attributable to those amounts, property or rights are (until paid or made available to the employee or other beneficiary) solely the property and rights of the City (without being restricted to the provisions of benefits under the plan), subject only to the claims of the City's general creditors. Participant's rights under the plan are equal to those of general creditors of the City in an amount equal to the fair market value of the deferred account of each participant. The City believes it has no liability for losses under the plan but does have the duty of due care that would be required of an ordinary prudent investor. The City believes that it is highly unlikely that it will use the assets to satisfy the claims of general creditors in the future. 65 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (17) Post-Retirement Health Care In addition to the pension benefits described in Note 15, the District, in accordance with the District's Administrative Code, provides post-retirement health care benefits to its full-time employees (including their dependents) who voluntarily retire after the age of 50 with no less than 5 years of service and whose age combined with years of service equals 70 or more. Currently, three retirees meet these eligibility requirements and are receiving benefits. The District is to pay 100% of the premiums for health insurance which is to be coordinated with Medicare and other benefits provided by federal and state law, when available, to the extent it reduces the cost of insurance premiums. Expenditures for post-retirement health care benefits are funded on a pay-as-you-go basis. Expenditures of approximately $7,000 were charged to expense for post-retirement health care costs during 1993. Based on an actuarial valuation performed as of November 1991, the District's liability for the current and past service costs of these benefits is approximately $1,600,000. (18) Segment Information for Enterprise Funds The City maintains four enterprise funds that provide water, sewer and other services. Segment information for the year ended June 30, 1993 is as follows: Operating revenues Operating expenses: Depreciation and amortization Other Operating income (loss) Nonoperating income (expenses), net Net income (loss) Residual equity transfers out Carlsbad Municipal Water District $10,427,476 1,102,100 10.319.471 (994.095) 958.073 S (36.0221 5 (23.5001 Golf Course 87.369 87.369 Sewer 4,482,637 1,152,700 2.869.468 Solid Waste 153.722 460,469 (86,164) 55.550 59.354 516.019 (26.8101 Totals 67.558 14,977,671 (32.4991 2,254,800 13.342.661 (619,790) 1.160.346 540.556 (55.9991 (Continued) 66 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (18) Segment Information for Enterprise Funds. (Continued) Contributed capital: Beginning balance Current year additions Ending balance Property, plant and equipment: Additions Deletions Net working capital Debt payable from operating revenues Total assets Total liabilities Total equity Carlsbad Municipal Water District Golf Course Sewer $38,656,024 1,859,990 34,971,412 1.513.887 565.200 2.061.653 $40.169.911 2.425.190 37.033.065 $ 2.998.998 $ 176.727 11.647 3.358.098 290.415 Solid Waste Totals 75,487,426 4.140.740 79.628.166 1.639 6.370.382 467.142 $16.692.620 1.912.703 15.279.781 58.452 33.943.556 .370.OOP 12.689.800 $69,971,896 2,702,486 70,152.057 12.925.680 25 15.026.693 - 24.059.800 62,712 142,889,151 2.621 27.955.019 $57.046.216 2.702.461 55.125.364 60.091 114.934.132 (19) Special Assessment Bonds Without Government Commitment As of June 30, 1993, the City has four series of Assessment District Bonds outstanding in the amount of $23,087,286. These bonds were issued under the provisions of the Improvement Bond Act of 1911 and 1915 and were used to finance public infrastructure improvement projects. Reserve funds of approximately $2,430,000 are held to secure payment of principal and interest on the outstanding bonds. For the bond issuances noted above, the City is not obligated in any manner for the payment of debt service in the event of default by the property owners but is only acting as agent for the property owners in collecting the assessments, forwarding the collections to bondholders, and initiating foreclosure proceedings, if appropriate. Accordingly, no liability for these bond issuances has been recorded in the General Long-terra Debt Account Group and all debt service transactions have been recorded in an Agency fund. 67 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (20) Mortgage Revenue Bonds Single-Family Mortgage Revenue Bonds have been issued to provide funds to purchase mortgage loans secured by first trust deeds on newly-constructed and existing single-family residences. The purpose of this program is to provide low interest rate home mortgage loans to persons of low or moderate income who are unable to qualify for conventional mortgages at market rates. Multi-Family Housing Revenue Bonds are issued to provide construction and permanent financing to developers of multi-family residential rental projects located in the City to be partially occupied by persons of low or moderate income. In May 1993, the City issued $15,920,000 in multi-family Housing Revenue Bonds. The purpose of these bonds is to refund the La Costa 1985 Series A bonds. The balance of the revenue bonds outstanding under these programs as of June 30, 1993 is $32,338,227. The bonds, together with interest thereon, are limited obligations of the City payable solely from bond proceeds, revenues and other amounts derived solely from home mortgage and developer loans secured by first deed of trust, irrevocable letters of credit, and irrevocable surety bonds. In the opinion of City officials, these bonds are not payable from any revenues or assets of the City, and neither the full faith and credit nor the taxing power of the City of Carlsbad, the state of California, nor any political subdivision thereof, is obligated to the payment of the principal or interest on the bonds. Accordingly, no liability has been recorded in the General Long-term Debt Account Group. One of the series of the Multi-Family Housing Revenue Bonds, with a current outstanding balance of $14,106,900, is in default due to non-payment. The surety is currently paying the debt service on the bonds. (21) Commitments and Contingencies 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. In May 1993, the City of Carlsbad entered into an agreement with the San Diego Association of Governments (SANDAG), whereby SANDAG will loan up to $10,000,000 of TransNet local funds to the City of Carlsbad on a reimbursement basis. The funds are to be used by the City of Carlsbad to accelerate the implementation of the Poinsettia Lane and La Costa Avenue/I-5 Interchange Improvement Project. No money was borrowed under this agreement during the year ended June 30, 1993. 68 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (22) Reclassification of Funds The accompanying financial statements reflect the reclassification of the Gas Tax Fund from the Capital Projects Fund Type to the Special Revenue Fund Type to better reflect the function and use of the fund. Beginning balances of the respective fund types have been restated to reflect this change in the fund type classification: Special Revenue Capital Projects Fund balances at July 1, 1992, as previously reported $6,542,783 28,649,145 Reclassification of fund 2.006.725 (2.006.725) Fund balances at July 1, 1992, as restated $8.549.508 26.642.420 (23) Expenditures in Excess of Appropriations Expenditures for the year ended June 30, 1993 exceeded appropriations of the following funds: Variance- Favorable Budget Actual (Unfavorable) Special Revenue Funds: Community Development Block Grant $ - 1,086 (1,086) Federal Grants 122,655 125,183 (2,528) Debt Service Fund: Redevelopment Bonds 1,395,217 1,876,922 (481,705) (24) Participation in San Diego Association of Governments (SANDAG) The City is a member of the San Diego Association of Governments (SANDAG), a joint powers agreement for the purpose of engaging in regional cooperative comprehensive planning, to assist the Member Agencies, and to provide a regional reviewing organization for certain federal and state grant projects. SANDAG is currently comprised of 18 incorporated Cities from the San Diego region and the County of San Diego. 69 CITY OF CARLSBAD Notes to General Purpose Financial Statements (Continued) (24) Participation in San Diego Association of Governments (SANDAG). (Continued) Summary financial information for the year ended June 30, 1992 is presented as follows: Total general fixed assets $ 1,375,633 Total other assets 533,864,826 Total general long-term debt 420,500,759 Total other liabilities 6,459,416 Total fund equity 527,405,410 Total revenues 148,288,024 Total expenditures/expenses 140,060,622 Total other financing sources (uses) 243,433,612 Net increase (decrease) in fund balance/retained earnings 251,671,014 (25) Subsequent Events On September 1, 1993, the Carlsbad Housing and Redevelopment Commission, a component unit of the City of Carlsbad, issued $15,495,000 in tax allocation bonds. The bonds were issued to defease the Carlsbad Housing and Redevelopment Commission $12,000,000 tax allocation bonds Series A, and to provide money to finance redevelopment activities within the project area. The interest rate is 5.25%, payable semi-annually. 70 GENERAL FUND The general fund is used to account for resources traditionally associated with government which are not required legally or by sound financial management to be accounted for in another fund. 71 CITY OF CARLSBAD General Fund Schedule of Revenues - Budget and Actual(Budgetary Basis) Year Ended June 30, 1993 2,300,000 300.000 7,845 2,431,827 262.430 Actual on Variance- Bugetary Favorable Budget Basis (Unfavorable) Taxes: Property taxes $13,200,000 12,585,129 (614,871) Sales and use taxes 9,500,000 9,167,849 (332,151) Transient lodging taxes 3,200,000 3,098,793 (101,207)Franchise taxes 925,000 983,584 58,584 Real property transfer taxes 200,000 184,424 (15,576)Trailer coach in-lieu tax - 5.867 5.867 Total taxes 27.025.000 26.025.646 (999.354) Licenses and permits: Construction permits 450,000 234,063 (215,937) Business licenses 975,000 1,071,342 96,342 License tax on new construction 425,000 143,322 (281,678) Other 300.000 276.046 (23.954) Total licenses and permits 2.150.000 1.724.773 (425.227) Fines and forfeits: Vehicle code fines 375,000 227,962 (147,038) Other - 3.915 3.915 Total fines and forfeits 375.000 231.877 (143.123) Interest income 1.700.000 2.093.659 393.659 Interdepartmental services: Engineering 500,000 508,499 8,499 Legal - 13,683 13,683Other 1.400.000 1.578.803 178.803 Total interdepartmental services 1.900.000 2.100.985 200.985 Intergovernmental: Grant revenue - 181.367 181.367 State subventions: Cigarette tax - 7,845 7,845 Vehicle licenses (in lieu) 2,300,000 2,431,827 131,827 Property tax reimbursements 300.000 262.430 (37.570) Total state subventions 2.600.000 2.702.102 102.102 Charges for services: Planning fees 750,000 603,426 (146,574) Building department fees 325.000 204,894 (120,106) Engineering fees 1,180,000 551,099 (628,901) Growth management zone plan fees 15,000 2,932 (12,068) Weed abatement fees 35,000 43.689 8,689 Ambulance fees 220,000 250,515 30,515 Park and recreation fees 750,000 697,365 (52,635) Other 344.300 481.615 137.315 Total charges for services 3.619.300 2.835.535 (783.7651 Miscellaneous: Sales of maps and publications - 54,959 54,959 Sales of property - 6,169 6,169 Reimbursed expenditures - 1,564,588 1,564,588 Other 306.435 187.668 (118.767) Total miscellaneous 306.435 1.813.384 1.506.949 Total revenues S39.675.735 39.709.328 33.593 72 CITY OF CARLSBAD General Fund Schedule of Expenditures - Budget and Actual (Budgetary Basis) Year Ended June 30, 1993 Actual on Bugetary Budget Basis General government: City council $ 159,368 153,747 City manager 846,830 840,373 City clerk 28,700 20,878 Visitors' bureau 302,809 302,809 Community assistance 111,000 111,000 Hiring center 80,000 76,498 City attorney 368,463 362,318 Finance 890,772 862,921 City treasurer 85,380 71,115 Audit 71,530 71,530 Purchasing 371,029 329,801 Human resources 788,953 648,312 Information systems 373,364 359,784 Risk Management/insurance 198,326 177,219 Contingency 112,367 Other 1.959.175 780.862 Total general government 6.748.066 5.169.167 Public safety: Police protection 8,798,924 8,603,014 Fire protection 6.822.337 6.813.767 Total public safety 15.621.261 15.416.781 Community development: Community development 791,393 635,899 Engineering 3,538,175 3,472,690 Planning 2,172,886 1,984,123 Building inspection 835,998 784,966 Other 5.572 3.448 Total community development 7.344.024 6.881.126 Culture and recreation: Library 2,315,992 2,316,540 Parks and recreation 3,830,710 3,696,115 Cultural arts 251.S2S 247.468 Total culture and recreat ion 6.398.227 6.260.123 Maintenance and utilities: Street maintenance 1,947,852 1, Facilities maintenance 1,268,400 1 Traffic signal maintenance 340,525Administration 349,944 Street lighting 28.000 Total maintenance and utilities 3.934.721 3.655.064 Total expenditures S40.046.299 37.382.261 799.979 235,668 279,309 312,108 28.000 Variance- Favorable (Unfavorable! 5,621 6,457 7,822 3,502 6,145 27.851 14,265 41,228 140,641 13,580 21,107 112,367 1.178.313 1.578.899 195,910 8.570 204.480 155,494 65,485 188,763 51,032 2.124 462.898 (548) 134,595 4.057 138.104 147,873 32,732 61,216 37,836 279.657 2.664.038 73 SPECIAL REVENUE FUNDS Special Revenue Funds are used to account for specific revenues whose expenditures are legally restricted to specified purposes. Civic Arts Program To account for transfers from the General Fund to support the civic arts program. Community Development Block Grant To account for federal block grants for commercial and residential loans for community development. Federal Grants To account for federal grants received to support the City's Library Programs and Historic Preservation. Gas Tax To account for receipts and expenditures of money apportioned under Streets and Highways Code of the state of California. Library Audio-Visual Insurance To account for revenues and expenditures on rental of audio-visual material. Low and Moderate Income Housing To account for money administered by the Carlsbad Redevelopment Agency for designated low and moderate income housing. Mortgage Revenue Bonds To account for money available to the City for expenditures incurred due to Mortgage Revenue Bonds. Fund closed to General Fund during year. Police Asset Forfeiture To account for money received under federal and state programs distributing property confiscated from illegal activities. 74 Section 8 Housing Authority To account for federal grants for low and moderate income housing supplemental payments. Senior Nutrition To account for money received and expenditures for senior programs under the Older Americans Act. Special Benefit Districts To account for revenues and expenditures from property tax assessments for street lighting and landscaping. State Grants To account for state of California Library and Civic Arts grants. 75 CITY OF CARLSBAD Special Revenue Funds Combining Balance Sheet June 30, 1993 Assets Cash and investments Receivables: Loan Taxes Accounts, net Accrued interest Due from other governments Prepaid expenditures Total assets Civic Arts Program $304,109 4,726 S308.83S Community Development Block Grant 60,472 12,477 Federal Grants Gas Tax Library Low and Audio- Moderate Visual Income Insurance Housing • 21,880 3,042,463 117,705 2,301,076 - 102,387 - 10,229 340 47,094 1,829 35,517 72.949 22.220 3.Q89.SS7 119.534 2.449.209 Liabilities and Fund Balances Liabilities: Accounts payable Accrued wages payable Due to other governments Due to other funds Total liabilities 14 14 - 799 1,182 12,345 894 127 8,026 12.345 894 8.153 Fund balances: Reserved for prepaid expenditures Reserved for loans receivable Reserved for low and moderate income housing Reserved for encumbrances 119,125 Unreserved: Designated for approved capital projects 121,400 Designated for continuing appropriations Undesignated 68.296 Total fund balances 308.821 Total liabilities and fund balances $308.835 12,477 1,137 805,953 102,387 2,319,379 101 19,290 44,680 400,000 60.472 (25.5781 1.871.259 118.539 72.949 20.239 3.077.212 118.640 2.441.056 72.949 22.220 3.089.557 119.534 2.449.209 76 Police Asset Forfeiture Section 8 Housing Authority Senior Nutrition Special Benefit Districts State Grants Totals 1,940,656 30,157 1.970.813 144,898 27,361 396.951 166 28,530 28.696 1.471,931 18,411 22,902 1.513.244 274,135 4,301 2,600 9,679,325 114,864 28,640 27,527 146,866 61,450 194.372 281.036 10.253.044 37,702 47,826 4,230 14,793 830 215.019 41.932 278.468 194,372 1,681 153,444 1.773.756 (75.889) 1.928.881 118.483 13,867 71,055 11.314 195,943 1,335 41,157 - 70,723 - - 830 13.494 - - 228.513 28.696 112.212 11.314 496.009 - - 194,372 - 114,864 - 2,319,379 31,372 21,615 1,000,274 - 121,400 433 598,557 1.369.660 247.674 5.408.189 1.401.032 269.722 9.757.035 1.970.813 396.951 28.696 1.513.244 281.036 10.253.044 77 CITY OF CARLSBAD Special Revenue Funds Combining Statement of Revenues, Expenditures and Changes in Fund Balances Year Ended June 30, 1993 Revenues: Taxes Intergovernmental Charges for services Interest income Miscellaneous Total revenues Civic Arts Program $ - 16,999 16.999 Community Development Block Grant 6,224 Federal Grants 60,868 849 Gas Tax 1,094,331 Library Audio- Visual Insurance 75,641 175,058 6,237 25.000 - Low and Moderate Income Housing 330,515 125,715 4.379 .717 1.294.389 81.878 460.609 Expenditures: Current: General government Public works Welfare - 1,086 Culture and recreation 15,740 Capital outlay - - Total expenditures 15.740 Excess (deficiency) of revenues over (under) expenditures 1.259 Other financing sources (uses): Operating transfers in 3,170 Grant payment - (507,451) Administrative fee received from bond refunding - - Total other financing sources (uses)3.170 (507.451) Excess (deficiency) of revenues and other financing sources over (under) expenditures and other financing uses 4,429 (502,313) Fund balances at beginning of year, as restated 304,392 575,262 Residual equity transfers out - - Fund balances at end of year S308.821 220,477 79,366 - 49,411 - 3.425 - 81,437 1.086 79.366 223.902 49.411 81.437 f!7.6491 1.070.487 32.467 379.172 36.616 36.616 (17,649) 1,070,487 32,467 415,788 37,888 2,006,725 86,173 2,025,268 20.239 3.077.212 118.640 2.441.056 78 Mortgage Revenue Bonds Police Section 8 Asset Housing Forfeiture Authority 527,478 104,607 7,170 70.764 632.085 2.510.731 Special Senior Benefit Nutrition Districts 2,432,797 105,870 74.533 180.403 1,575.883 83,749 31.550 State Grants 199,042 14,200 Totals 1,424,846 3,326,055 1,651,524 540,808 206.226 1.691.182 213.242 7.149.459 392,997 2,529,978 180,403 1,562,647 303,800 474,434 1,783,124 2,711,467 448,317 3.425 392.997 2.529.978 180.403 1.562.647 303.800 5.420.767 239.088 (19.247)128.535 (90.5581 1.728.692 3,170 (507,451) 36.616 (467.665) 239,088 (19,247) 53,500 1,689,793 137,730 (53.500) - - - 1.928.881 118.483 128,535 (90,558) 1,261,027 1,272,497 360,280 8,549,508 - - (53.500) 1.401.032 269.722 9.757.035 79 CITY OF CARLSBAD Special Revenue Funds Combining Schedule of Revenues and Expenditures Budget and Actual (Budgetary Basis) Year Ended June 30, 1993 Civic Arts Program Revenues: Taxes Intergovernmental Charges for services Interest income Miscellaneous Total revenue Community Development Block Grant Actual on Variance- Actual on Variance- Budgetary Favorable Budgetary Favorable Budget Basis (Unfavorable) Budget Basis (Unfavorable) 16,999 16.999 78.000 16,999 16.999 78.000 6,224 6.224 (78,000) 6,224 Expenditures: Current: General government Public works Welfare Culture and recreation Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures 255,141 134,865 255.141 134.865 120,276 1,086 (1,086) S(2S5.141) (117.866) 137.275 78.000 1.086 (1.086) 5.138 (72.862) 80 Budget Federal Grants Actual on Variance- Budgetary Favorable Basis (Unfavorable) 60,868 60,868 849 849 61.717 61.717 50,000 Gas Tax Actual on Variance- Budgetary Favorable Budget Basis (Unfavorable) 875,000 1,094,331 175.058 25.000 925.000 1.294.389 219,331 125,058 25.000 369.389 122,655 125,183 122.655 125.18 (2.528) 1,426,821 1,426,430 3.425 3.425 (2.528) 1.430.246 1.429.855 391 391 (122.655) (63.466) 59.189 (SOS.246) (135.466)369.780 81 CITY OF CARLSBAD Special Revenue Funds Combining Schedule of Revenues and Expenditures • Budget and Actual (Budgetary Basis), Continued Year Ended June 30, 1993 Revenues: Taxes Intergovernmental Charges for services Interest income Miscellaneous Total revenues Library Audio-Visual Insurance Low and Moderate Income Housing Actual on Variance- Actual on Variance- Budgetary Favorable Budgetary Favorable Budget Basis (Unfavorable! Budget Basis (Unfavorable) $ - 60,000 1,000 75,641 6,237 15,641 5,237 400,000 330,515 (69,485) 100,000 125,715 25,715 - 4.379 4.379 61.000 81.878 20.878 SOO.OOO 460.609 (39.391) Expenditures: Current: General government Public works Welfare Culture and recreation Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures 66,452 49,512 16,940 126,925 100,727 26,198 .452 49.512 16.940 126.925 100.727 26.198 SfS.4521 32.366 37.818 373.075 359.882 (13.1931 82 Police Asset Forfeiture Actual on Variance- Budgetary Favorable Budget Basis (Unfavorable! Section 8 Housing Authority Actual on Variance- Budgetary Favorable Budget Basis (Unfavorable) 200,000 527,478 327,478 10,000 104,607 94,607 210.000 632.085 422.085 2,556,821 2,432,797 (124,024) 8,000 7,170 70.764 (830) 70.764 2.564.821 2.510.731 (54.090) 548,122 548,122 2,611,894 2,529,978 81,916 548.122 548.122 2.611.894 2.529.978 81.916 (338.122) 83.963 422.085 (47.073) (19.247) 27.826 83 CITY OF CARLSBAD Special Revenue Funds Combining Schedule of Revenues and Expenditures • Budget and Actual (Budgetary Basis), Continued Year Ended June 30, 1993 Senior Nutrition Revenues: Taxes Intergovernmental Charges for services Interest income Miscellaneous Total revenues Actual on Variance- Budgetary Favorable Budget Basis (Unfavorable! Special Benefit Districts $ - 103,000 105,870 75.000 74.533 178.000 180.403 2,870 .1467) 2.403 Actual on Budgetary Budget Basis 1,614,986 8,300 1.000 1,575,883 83,749 31.550 Variance- Favorable (Unfavorable! 1.624.286 1.691.182 (39,103) 75,449 30.SSO 66.896 Expenditures: Current: General government Public works Welfare Culture and recreation Capital outlay Total expenditures 180,967 180,403 Excess (deficiency) of revenues over (under) expenditures £ (2.9671 180.967 180.403 564 2,033,901 1,594,019 439,882 564 2.033.901 1.594.019 439.882 2.967 (409.6151 97.163 506.778 84 Budget State Grants Actual on Variance- Budgetary Favorable Basis (Unfavorable)Budget Totals Actual on Variance- Budgetary Favorable Basis (Unfavorable! 150,000 1,400 151.400 199,042 14.200 49,042 12,800 1,275,000 3,087,821 1,674,986 178,700 76.000 1,424,846 3,326,055 1,651,524 540,808 206.226 61.842 6.292.507 7.149.459 149,846 238,234 (23.462) 362,108 130.226 856.952 336,814 336.814 325,848 325.848 10,966 10.966 675,047 3,460,722 2,792,861 781,062 3.425 648,849 3.020,449 2,711,467 635,408 3.425 7.713.117 7.019.598 26,198 440,273 81,394 145,654 693.519 (185.4141 (112.6061 72.808 (1.420.6101 129.861 1.550.471 85 86 DEBT SERVICE FUNDS Debt Service Funds are used to account for accumulation of resources for, and payment of, principal and interest on the City's general bonded debt and special assessment bonds for which the City is obligated in some manner. Building Authority To account for receipts by the Building Authority from the General Fund for the 1967 Building Authority Revenue Bonds. Bonds were issued to construct City Hall. During the year, bonds were paid in full and fund closed to General Fund. College Boulevard To accumulate property assessments levied for payment of debt service on 1986 College Boulevard Assessment District Bonds. HOSD Grove COPs To account for payment of debt service on the 1988 Certificates of Participation issued to purchase Hosp Grove. Parking Authority To account for receipts received by the Parking Authority from the General Fund for payment of debt service on 1969 and 1981 Parking Authority Revenue Bonds. Redevelopment Bonds To account for payment of debt service on 1988 Tax Allocation Bonds issued to finance improvements for the Carlsbad Redevelopment Agency. 87 CITY OF CARLSBAD Debt Service Funds Combining Balance Sheet June 30, 1993 Assets Cash and investments Receivables: Taxes Special assessments Accrued interest Total assets College Boulevard 11,221 7,290,000 19.837 S8.597.553 Grove COPs $1,276,495 876,096 29.980 906.076 Hosp Parking Redevelopment Authority Bonds 588,939 11.314 600.253 1,739,951 40,916 6.905 Totals 4,481,481 52,137 7,290,000 68.036 1.787.772 11.891.654 Liabilities and Fund Balances Liabilities: Deferred revenue Total liabilities S7.290.OOP 7.290.000 7.290.000 7.290.000 Fund balances: Reserved for debt service Unreserved: Designated for arbitrage Total fund balances Total liabilities and fund balances 1,307,553 903,451 600,253 - 2.625 - 1.307.553 906.076 600.253 $8.597.553 906.076 600.253 1,787,772 4,599,029 - 2.625 1.787.772 4.601.654 1.787.772 11.891.654 88 CITY OF CARLSBAD Debt Service Funds Combining Statement of Revenues, Expenditures and Changes in Fund Balances Year Ended June 30, 1993 Revenues: Taxes Interest income Total revenues Building College Authority Boulevard Hosp Grove Parking Redevelopment COPs Authority Bonds Totals $ - 1.819 1.819 422,490 98.360 520.850 74.977 74.977 41.792 41.792 1,322,061 121.515 1.443.576 1,744,551 338.463 2.083.014 Expenditures: Debt service: Principal retirement Interest and fiscal charges State mandated payment Total expenditures Excess (deficiency) of revenues over (under) expenditures 35,000 5,920 40.920 885,000 260,000 175,000 673,403 637,248 108,398 1.558.403 897.248 283.398 290,000 1,329,644 257.278 1.876.922 1,645,000 2,754,613 257.278 4.656.891 (39.101) (1.037.553) (822.271) (241.606) (433.346) (2.573.877) Other financing sources (uses): Operating transfers in Operating transfers out Total other financing sources (uses) Excess (deficiency) of revenues and other financing sources over (under) expenditures and other financing uses Fund balances at beginning of year Residual equity transfers out Fund balances at end of year •"1.016,514 1.016.514 735,051 (76) 734.975 130,500 130.500 464,061 464.061 2,346,126 (76) 2.346,050 (39,101) (21,039) (87,296) (111,106) 113,647 1,328,592 993,372 711,359 (74.546) - - - 1.307.553 906.076 600.253 30,715 1,757,057 1.787.772 (227,827) 4,904,027 (74.546) 4.601.654 89 CITY OF CARLSBAD Redevelopment Bonds Fund Schedule of Revenues and Expenditures - Budget and Actual (Budgetary Basis) Year Ended June 30, 1993 Revenues: Taxes Interest income Total revenues Budget $1,600,000 60.000 Actual on Budgetary Basis 1,322,061 121.515 Variance- Favorable (Unfavorable) (277,939) 61.515 1.660.000 1.443.576 (216.424) Expenditures: Debt service: Principal retirement Interest and fiscal charges State mandated payment Total expenditures Excess (deficiency) of revenues over (under) expenditures 290,000 847,939 257.278 1.395.217 $ 264.783 290,000 1,329,644 257.278 1.876.922 (433.346) (481,705) (481.705) (698.129) 90 91 CAPITAL PROJECTS FUNDS Capital Projects Funds are used to account for the purchase or construction of major capital facilities which are not financed by Proprietary or Trust Funds. Assessment Districts To account for capital projects financed by the issuance of assessment district bonds. Capital Construction To account for transfers from the General Fund for various municipal capital projects. Community Development Block Grants To account for federal block grants for community development. Community Facilities District To account for capital projects financed by Community Facility District (Mello-Roos) funding. County Airport Road Project To account for receipt of San Diego County funds for improvements adjacent to McClellan-Palomar Airport. Palomar Airport Road East Project To account for funding and expenditures related to construction of Palomar Airport Road at El Camino Real and east to San Marcos city limits. Funding is provided by the cities of San Marcos and Vista, San Diego County Airport, Sales Tax/TransNet, Traffic Impact fees, and direct developer contributions. Park Development To account for receipts of fees charged to developers for park acquisition and development. Planned Local Drainage Facilities To account for receipts of fees charged to developers for drainage facilities necessitated by growth. 92 Public Facilities Construction To account for receipts of fees charged to developers for specific capital projects necessitated by growth. Redevelopment Agency To account for financial resources segregated for the rehabilitation of commercial and public property located in the Carlsbad Village area. Redevelopment Area II To account for the costs of a feasibility study on establishing a second redevelopment area. Redevelopment Bond Project To account for capital projects financed by 1988 Carlsbad Redevelopment Agency Tax Allocation Bonds. Sales Tax/TransNet To account for receipts of County sales taxes allocated by the San Diego County Regional Transportation Commission to finance transportation projects. State Grants To account for capital projects financed by state grants including Local Transportation Funds and Carlsbad Boulevard Shore Protection. Traffic Impact Projects To account for receipts of fees charged to developers for street construction and improvement. 93 CITY OF CARLSBAD Capital Projects Funds Combining Balance Sheet June 30, 1993 Assets Cash and investments Receivables: Taxes Accounts, net Accrued interest Due from other governments Advances to other funds Total assets Assessment Districts $1,726,084 11,523 $1.737.607 Community Capital Development Construction Block Grants 2,913,900 40,000 1.700.000 4.653.900 70,908 70.908 Liabilities and Fund Balances Liabilities: Accounts payable Accrued wages payable Due to other funds Deposits payable Advances from other funds Deferred revenue Total liabilities $ 10,661 68,798 10.661 68.798 55,642 1,611 13,655 70.908 Fund balances (deficit): Reserved for advances to other funds - 1,700,000 Reserved for encumbrances 112,067 43,986 Unreserved: Designated for approved capital projects 1,385,380 1,672,845 Undesignated 229.499 1.168.271 Total fund balances (deficit) 1.726.946 4.585.102 Total liabilities and fund balances $1.737.607 4.653.900 92,786 (92.786) 70.908 94 Community Facilities District 8,324,092 6,780 129,374 8.460.246 367,374 841,067 — 1.208.441 849,775 4,810,255 1.591.775 7.251.805 Palomar County Airport Airport Road Road East Park Project Project Development 1,015,666 1,299,063 2,962,514 _ 15,783 20,187 46,037 1.031.449 1.319.250 3.008.551 543,226 — — — 2,550,000 543.226 2.550.000 4,537,436 399,773 631.676 (3.761.412) 458.551 1.031.449 776.024 458.551 Planned Local Drainage Facilities 2,843,076 - 44,180 2.887.256 — 300,000 300.000 - 1,119,959 1.467.297 2.587.256 Public Facilities Construction 8,896,337 - 138,275 9.034.612 167,803 — 950,000 1.117.803 490,236 4,485,819 2.940.754 7.916.809 8.460.246 1.031.449 1.319.250 3.008.551 2.887.256 9.034.612 95 CITY OF CARLSBAD Capital Projects Funds Combining Balance Sheet June 30, 1993 Assets Cash and investments Receivables: Taxes Accounts, net Accrued interest Due from other governments Advances to other funds Total assets Redevelopment Redevelopment Redevelopment Agency Area II Bond Proiect $ 67,520 5,615 $ 73.135 16,529 257 16.786 2,769,115 2.769.115 Liabilities and Fund Balances Liabilities: Accounts payable $ 8,361 Accrued wages payable 13,547 Due to other funds Deposits payable Advances from other funds Deferred revenue Total liabilities Fund balances (deficit): Reserved for advances to other funds Reserved for encumbrances Unreserved: Designated for approved capital projects Undesignated Total fund balances (deficit) Total liabilities and fund balances $ 73.135 7,924,846 7.946.754 45,833 (7.919.452) (7.873.619) 30,000 30.000 11,502 (24.716) (13.214) 16.786 26,861 26.861 146,409 2,459,371 136.474 2.742.254 2.769.115 96 Traffic Sales Tax/ State Impact Transnet Grants Projects Totals 1,740,158 217,249 2,732,409 37,523,712 6,780 40,000 27,463 3,376 42,461 484,531 70,908 - - - 1.700.000 1.767.621 220.625 2.774.870 39.825.931 677 1,022 66,023 1,316,448 15,158 13,655 841,067 750,000 12,504,846 : 78.316 20.400 98.716 677 79.338 836.423 14.789.890 1,700,000 91,852 10,223 47,287 6,479,392 1,434,681 131,064 1,891,160 19,790,307 240.411 - - (2.933.658) 1.766.944 141.287 1.938.447 25.036.041 1.767.621 220.625 2.774.870 39.825.931 97 CITY OF CARLSBAD Capital Projects Funds Combining Statement of Revenues, Expenditures and Changes in Fund Balances Year Ended June 30, 1993 Revenues: Taxes Intergovernmental Charges for services Interest income Contributions from property owners Miscellaneous Total revenues Expenditures: Current: General government Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures Other financing sources (uses): Operating transfers in Operating transfers out Total other financing sources (uses) Excess (deficiency) of of revenues and other financing sources over (under) expenditures and other financing sources Fund balances (deficit) at beginning of year, as restated Residual equity transfers in Residual equity transfers out Fund balances (deficit) at end of year Assessment Districts $ 45,675 104,077 11.233 160.985 Community Capital Development Construction Block Grants 199.427 199.427 (38.442) (1.016.514) (1.016.514) (1,054,956) 3,959,283 10,979 (1.188.360) $1.726.946 162,554 39.887 202.441 472.029 472.029 (269.588) 175,000 (3.170) 171.830 (97,758) 4,682,860 4.585.102 266,250 1.697 267.947 145,023 122.924 267.947 98 Community Facilities District 1,812,440 688,887 492,260 2.993.587 168,920 2.296.413 2.465.333 County Airport Road Project 165,375 51,763 217.138 _ Palomar Airport Road East Project 1,040,186 53,071 113,758 1.207.015 1.882.027 1.882.027 Planned Local Park Drainage Development Facilities 68,456 4,063 182,102 160,473 250.558 164.536 _ _ Public Facilities Construction 387,109 498,834 885.943 1.549.809 1.549.809 528.254 217.138 (675.012)250.558 164.536 (663.866) (117) 1,451,036 (117) 1.451.036 528,254 217,021 776,024 250,558 164,536 (663,866) 6,723,551 814,428 207,993 2,422,720 8,580,675 7.251.805 1.031.449 776.024 2.587.256 7.916.809 99 CITY OF CARLSBAD Capital Projects Funds Combining Statement of Revenues, Expenditures and Changes in Fund Balances, (Continued) Year Ended June 30, 1993 Redevelopment Redevelopment Redevelopment Agency Area II Bond Project Revenues: Taxes $ - Intergovernmental 29,800 Charges for services 750 Interest income 24,546 770 84,974 Contributions from property owners - Miscellaneous 14.795 - - Total revenues 69.891 770 84.974 Expenditures: Current: General government 753,104 15,985 Capital outlay 68.681 - 163.179 Total expenditures 821.785 15.985 163.179 Excess (deficiency) of revenues over (under) expenditures (751.894) (15.215) (78.205) Other financing sources (uses): Operating transfers in - Operating transfers out (464.061) - - Total other financing sources (uses) (464.061) - " - Excess (deficiency) of revenues and other financing sources over (under) expenditures and other financing uses (1,215,955) (15,215) (78,205) Fund balances (deficit) at beginning of year, as restated (6,657,664) 2,001 2,820,459 Residual equity transfers in - Residual equity transfers out - - - Fund balances (deficit) at end of year $(7.873.619) (13.214) 2.742.254 100 Sales Tax/ TransNet 2,170,000 130,638 2.300.638 155.278 155.278 2.145.360 Q. 351. 057) (1. 351. 057) Traffic State Impact Grants Projects 109,643 89,273 13,120 155,205 122.763 244.478 68.159 214.076 68.159 214.076 54.604 30 ..402 (99 ..862) (99.862) Totals 1,812,440 3,781,254 1,238,538 1,893,431 380,389 67.612 9.173.664 1,083,032 7.192.002 8.275.034 898.630 1,626,036 (2.934.781) (1.308.745) 794,303 54,604 (69,460) (410,115) 972,641 105,566 2,007,907 26,642,420 10,979 - (18.883) :: (1.207.243) 1.766.944 141.287 1.938 ..447 25.036.041 101 1Q2 ENTERPRISE FUNDS Enterprise Funds are used to account for operations that are financed and operated in a manner similar to private business enterprises - where the intent of the governing body is that the costs of providing goods or services to the general public be financed or recovered primarily through user charges. Carlsbad Municipal Water District To account for the operation, maintenance, planning, capital facility financing, and all customer service functions of the Carlsbad water system. Golf Course To account for revenues, expenses and the construction activities of the City's proposed municipal golf course. To account for the operation, maintenance and capital facility financing of the City's sewer system. Solid Waste To account for revenues and expenses of the City's solid waste source-reduction and recycling programs. 103 CITY OF CARLSBAD Enterprise Funds Combining Balance Sheet June 30, 1993 Assets Current assets:Cash and investmentsReceivables: TaxesAccounts, netAccrued interestDue from other fundsInventory Total current assets Restricted assets:Cash and investmentsAccrued interest Total restricted assets Property, plant and equipment Less accumulated depreciation Property, plant and equipment, net Total assets Liabilities and Fund Equity Current liabilities: Accounts payableAccrued wages payableDue to other funds Current portion of long-term debt Deposits payable Total current liabilities Current liabilities payable fromrestricted assets - accrued interest payable Deferred revenue Certificates of participation, net ofunamortized issuance costs of $320,521Installment purchase agreement, netof unamortized discount of $385,725 Total liabilities Fund equity: Contributed capital Retained earnings: Reserved for debt service Reserved for rate stabilization Unreserved Total fund equity Total liabilities and fund equity CarlsbadMunicipalWater District Golf Course Sewer Solid Waste Totals $16,232,546 11,640 2,574,530 261,076 219.029 19.298.821 2,302,763 2.302.763 58,860,918 flO. 490. 6061 48.370.312 $69.971.896 $ 1,142,419 267,161 204,657 730,000 126.999 2.471.236 134.965 10,319.479 12.925.680 40,169,911 559,726 878,072 15.438.507 57.046.216 1,883,459 15,399,831 29,269 239,341 204,657 10.567 1.912.728 15.854.396 3,098,969 6.938 3.105.907 789.758 61,052,192 (9. 860.438) 789.758 51.191.754 2.702.486 70.152.057 25 111,947 42,429 274,630 145.609 25 574.615 351.855 2,070,778 12.029.445 25 15.026.693 2,425,190 37,033,065 2,479,422 277.271 15.612.877 2.702.461 55.125.364 60,138 935 61.073 1,639 1.639 62.712 1,310 1,260 2.621 - 2.621 60.091 60.091 33,575,974 11,640 2,574,530 530,621 204,657 229.596 37.127.018 5,401,732 6.938 5.408.670 120,704,507 (20.351.0441 100.353.463 142.889.151 1,255,701 310,850 204,657 1,004,630 272.659 3.048.497 486.820 2,070,778 10,319,479 12.029.445 27.955.019 79,628,166 3,039,148 878,072 31.388.746 114.934.132 S69.971.896 2.702.486 70.152.057 62.712 142.889.151 104 CITY OF CARLSBAD Enterprise Funds Combining Statement of Revenues, Expenses and Changes in Retained Earnings Year Ended June 30, 1993 Operating revenues: Water sales Sewer services charges Other charges for services Contributions from other government agencies Miscellaneous Total operating revenues Carlsbad Municipal Water District Coif Course $ 9,844,421 353,864 75,794 153.397 - 10.427.476 Sewer Solid Waste Totals 4,382,889 61,473 38.275 67,558 9,844,421 4,382,889 482,895 75,794 191.672 4.482.637 67.558 14.977.671 Operating expenses: Plant operations Purchased water Depreciation and amortization General and administrative Total operating expenses Operating income (loss) Nonoperating revenues (expenses): Interest income Interest expense and fees Gain (loss) on sale of property Property taxes Miscellaneous income (expense) Amortization of issuance costs Total nonoperating revenues (expenses) Net income (loss) Retained earnings at beginning of year Residual equity transfers out Retained earnings at end of year 6,137,022 1,102,100 4.182.449 11.421.571 (994.095) 1,067,358 (855,595) 14,789 758,231 (26.710) 958.073 (36,022) 16,935,827 (23.500) 1,608,483 1,152,700 1.260.985 4.022,168 460.469 87,369 930,598 (851,292) (6,223) (17,533) 87.369 55.550 87,369 516,019 189,902 17,608,779 (32.499) 153.722 153.722 (86.164) 830 58,524 (26,810) 86,901 1,608,483 6,137,022 2,254,800 5.597.156 15.597.461 (619.790) 2,086,155 (1,706,887) 8,566 758,231 58,524 (44.243) 1.160.346 540,556 34,821,409 (55.999) $16.876.305 277.271 18.092.299 60.091 35.305.966 105 CITY OF CARLSBAD Enterprise Funds Combining Statement of Cash Flows Year Ended June 30, 1993 Carlsbad Municipal Water District Cash flows from operating activities: Operating income (loss) $ (994,095) Adjustments to reconcile operating income (loss) to net cash provided by operating activities: Depreciation and amortization 1,102,100 Decrease in receivables (335,066) Increase (decrease) in advances and due to/due from other funds 29,874 Decrease in due from other governments Increase in inventory Increase (decrease) in deposits payable Increase (decrease) in accounts payable Increase in accrued wages payable Net cash provided by (used in) operating activities 458.945 Cash flows from noncapital financing activities: Transfer to other funds Cash flows from capital and related financing activities: Purchases of property, plant and equipment Principal payment on bonds Interest and other fees paid on bonds Property taxes received Capital contributions received Net cash provided by (used in) capital and related financing activities Cash flows from investing activities: Investments in restricted assets Interest on investments Net cash provided by investing activities Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year Supplemental schedule of noncash investing and financing activities - capital assets contributed by contractors f23.5001 (2,011,405) (685,000) (857,365) 758,231 534.887 (2.260.6521 139,453 1.147.086 1.286.539 (538,668) 16.771.214 $16.232.546 979.000 Golf Course Sewer Solid Waste 460,469 (86,164) 1,152,700 (29,874) (4781 1.544.993 (32.4991 (11,647) (942,263) (1,639) (1,254,550) 565.200 287.451 58.524 1,042,983 78.366 925.272 2.798 78.366 1.968.255 2.798 Totals (619,790) 2,254,800 (335,066) 210,885 e (8,045) 434,664 18.628 "~ (478) 3,028 41,709 (89,396) 6.357 — * (10,318) 1.260 213,913 33,664 334,472 26.245 1.908.238 (55.9991 (2,966,954) (685,000) (2,111,915) 758,231 1.446.062 553.553 (1.909.3621 56.885 (3.559.5761 631,441 1,571,387 (35,539) 1.252.018 13.828.444 95.677 1.883.459 15.399.831 60.138 1,182,4362.153.522 3.335.958 1,628,621 1.774.202 31.947.353 33.575.974 2.753.202 106 INTERNAL SERVICE FUNDS Internal Service Funds are used to account for the financing of goods or services provided by one department or agency of a government to other departments or agencies on a cost reimbursement basis. Data Processing To account for charges to other funds for data processing services. Fleet Management To account for charges to other funds to provide fleet maintenance and accumulate funds for fleet replacement. General Liability Self-Insurance To account for charges to other funds to insure for liability claims against the City. Health Insurance To account for charges to other funds and from employees to provide health insurance for full-time City employees. Workers' Compensation To account for charges to other funds to insure against Workers' Compensation claims. 107 CITY OF CARLSBAD Internal Service Funds Combining Balance Sheet June 30, 1993 General Liability Data Fleet Self Health Workers' Processing Management Insurance Insurance Compensation Totals- Current assets: Cash and investments Receivables: Accounts, net Accrued interest Inventory Total current assets $ 544,198 3,028,675 2,788,784 1,731,019 2,293,294 10,385,970 6,601 - 8,457 47,067 43,337 26,894 35,638 - 97.061 - - - 552.655 3.179.404 2.832.121 1.757.913 2.328.932 6,601 161,393 97.061 10.651.025 Property, plant and equipment: Equipment and vehicles Less accumulated depreciation Net Property, plant and equipment Total assets 876,354 4,364,083 (343.165) (2.139.0661 533.189 2.225.017 5,240,437 (2.482.231) 2.758.206 SI.085.844 5.404.421 2.832.121 1.757.913 2.328.932 13.409.231 Liabilities and Fund Equity Current liabilities: Accounts payable Accrued wages payable Estimated claims payable Total current liabilities Fund equity: Contributed capital - contributed from other funds Retained earnings - unreserved Total fund equity Total liabilities and fund equity $11,234 22,694 33.928 177,642 22,984 200.626 69,733 871.157 940.890 38,518 333.000 371.518 367 1.008.267 1.008.634 616,242 2,945,698 1,910,000 435.674 2.258.097 (18.769) 1.386.395 1,000,000 320.298 297,494 45,678 2.212.424 2.555.596 6,471,940 4.381.695 1.051.916 5.203.795 1.891.231 1.386.395 1.320.298 10.853.635 SI.085.844 5.404.421 2.832.121 1.757.913 13.409.231 108 CITY OF CARLSBAD Internal Service Funds Combining Statement of Revenues, Expenses and Changes in Retained Earnings Year Ended June 30, 1993 Operating revenues: Charges for services Miscellaneous Total operating revenues General Liability Data Fleet Self Health Workers' Processing Management Insurance Insurance Compensation Totals $ 453,742 2,172,405 824,230 1,478,087 623,014 5,551,478 16.310 77.742 5.118 325.767 49.652 474.589 470.052 2.250.147 829.348 1.803.854 672.666 6.026.067 Operating expenses: Depreciation Fuel and supplies Claims expense General and administrative Total operating expenses Operating income (loss) Nonoperating revenues (expenses): Interest income Gain (loss) on sale of property Total non-operating revenues Net income (loss) Retained earnings at beginning of year Retained earnings (deficit) at end of year 86,885 579.603 666.488 (196.436) 30,412 (2.512) 27.900 (168,536) 446,511 457,019 792.743 1.696.273 553.874 163,549 (14.834) 148.715 702,589 1,134,082 1.134.082 (304.734) 144,520 144.520 (160,214) 1,824,547 1.824.547 (20.693) 101,846 101.846 81,153 639,500 639.500 33.166 103,365 103.365 136,531 533,396 457,019 3,598,129 1.372.346 5.960.890 65.177 543,692 (17.346) 526.346 591,523 604.210 1.555.508 141.445 1.305.242 183.767 3.790.172 S 435.674 2.258.097 (18.769) 1.386.395 320.298 4.381.695 109 CITY OF CARLSBAD Internal Service Funds Combining Statement of Cash Flows Year Ended June 30, 1993 Cash flows from operating activities: Operating income (loss) Adjustments to reconcile operating income (loss) to net cash provided by operating activities: Depreciation and amortization (Increase) decrease in receivables Decrease in inventory Increase (decrease) in accounts payable Increase (decrease) in accrued wages payable Increase (decrease) in estimated claims payable Net cash provided by operating activities Cash flows from capital and related financing activities: Purchases of property, plant and equipment Capital contributions received Net cash provided by (used in) capital and related financing activities Cash flows from investing activities - interest on investments Data Processing General Liability Fleet Self- Health Workers' Management Insurance Insurance Compensat ion Totals $(196,436) 553,874 (304,734) (20,693) 33,166 65,177 86,885 8,035 2,516 446,511 (184) (15,430) 117,840 114,011 (3,315) 177.120 29 (4,163) 207 141.000 (344.398) 533,396 (155) (15,430) 235,930 (799) (26.278) Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year Supplemental schedule of noncash investing and financing activities - capital assets contributed by other funds (99.000) 1.099.296 (13.603) 116.173 (311.025) 791.841 (14.072)(283,186) 30.000 (297,258) 500.000 530.000 (14.072) (253.186)500.000 232.742 32.069 Net increase in cash and cash equivalents (81,003) 151.617 144.194 99.469 100.157 527.506 997,727 130,591 215,642 289,132 1,552,089 625.201 2.030.948 2.658.193 1.515.377 2.004.162 8.833.881 S 544.198 3.028.675 2.788.784 1.731.019 2.293.294 10.385.970 $ 4.315 366.233 370.548 110 GENERAL FIXED ASSETS ACCOUNT GROUP General fixed assets are those fixed assets used in operations accounted for in governmental funds. General fixed assets include all fixed assets not accounted for in an enterprise, internal service, or trust and agency fund,, 113 CITY OF CARLSBAD General Fixed Asset Account Group Schedule of General Fixed Assets by Function June 30, 1993 General Culture & Public Public Government Recreation Safety Works Totals Land $1,142,921 21,912,577 2,150,407 740,763 25,946,668 Buildings 2,998,460 10,410,066 13,996,610 - 27,405,136 Improvements 790,218 1,885,192 120,563 23,471 2,819,444 Furniture and equipment 1,383,255 1,188,884 1,864,190 469,876 4,906,205 Construction in progress - 1.939.831 489 - 1.940.319 Total $6.314.854 37.336.550 18.132.259 1.234.110 63.017.773 114 AGENCY FUNDS Agency Funds are used to account for assets held by a government for other funds, governments or individuals. Deferred Compensation To account for employees' deposits in deferred compensation plans offered by the City. Contractors' Deposits To account for money deposited by contractors for designated future development. Miscellaneous Deposits To account for money deposited with the City for various purposes. Assessment Districts To account for the debt service transactions on assessment district bonds for which the City is not obligated. Ill CITY OF CARLSBAD Agency Funds Combining Statement of Changes in Assets and Liabilities Year Ended June 30, 1993 Balances at July 1. 1992 Deferred compensation: Assets: Deferred compensation investments $ 4.712.077 Liabilities: Deferred compensation payable $ 4.712.077 Contractors' deposits: Assets: Cash and investments S 1.828.573 Liabilities: Deposits payable $ 1.828.573 Miscellaneous deposits: Assets: Cash and investments $ 7,807,994 Accrued interest 1.466 Total assets $ 7.809.460 Liabilities: Accounts payable $ 8,660 Deposits payable 6,069,308 Due to other governments 1,731,492 Interest payable - Total liabilities & 7.809.460 Assessment districts: Assets: Cash and investments $ 4,478,346 Accrued interest 49.187 Total assets S 4.527.533 Liabilities: Assessments payable S 4.527.533 Totals - all aeencv funds: Assets: Cash and investments $14,114,913 Deferred compensation investments 4,712,077 Accrued interest 50.653 Total assets S18.877.643 Liabilities: Accounts payable $ 8,660 Deposits payable 7,897,881 Deferred compensation payable 4,712,077 Assessments payable 4,527,533Due to other governments 1,731,492 Interest payable - Total liabilities $18.877.643 Balances at Additions Redact ions June 30. 1993 1.193.890 1.193.890 47.520 52.170 31,662,196 12.536 31.674.732 10,708 16,830,279 378.620 17.219.607 3,250,840 46.443 3.297.283 2.968.429 34,960,556 1,193,890 58.979 36.2^3r425 10,708 16,882,449 1,193,890 2,968,429 378.620 21.434.096 f 126. 000) f!30.650) (32,614,226) a. 466) f32.61S.692) (17,321) (16,411,754) (1,731,492) fl8.160.567) (3,556,003) f 49. 202) f3. 605. 205) f3. 276. 351) (36,296,229) (50.668) f36.346.897) (17,321) (16,542,404) (3,276,351) (1,731,492) f21.S67.568) 5.905.967 5.905.967 1.750.093 1,750.093 6,855,964 12.536 6. 868 r 500 2,047 6,487,833 378.620 6.868.500 4,173,183 46.428 4.219.611 4.219.611 12,779,240 5,905,967 58.964 18.744.171 2,047 8,237,926 5,905,967 4,219,611 378.620 18.744.171 112 CITY OF CARLSBAD General Fixed Assets Account Group Schedule of Changes in General Fixed Assets by Function Year Ended June 30, 1993 Function General government Culture and recreation Public safety Public works Total General Fixed General Fixed Assets at Assets at July 1. 1992 Additions Deductions June 30. 1993 $ 6,343,866 36,987,133 18,493,586 1.211.619 118,689 (147,700) 6,314,854 1,798,599 (1,449,182) 37,336,550 405,143 (766,470) 18,132,259 31.572 (9.082) 1.234.110 $63.036.204 2.354.003 (2.372.434) 63.017.773 115 CITY OF CARLSBAD General Fixed Asset Account Group Schedule of General Fixed Assets by Source June 30, 1993 As of June 30, 1986 $27,136,537 Net additions subsequent to June 30, 1986: General fund 13,867,842 Community Development Block Grants 1,932,027 Federal grants 460,587 State grants 683,065 Street lighting 8,612 Park development 6,010,631 Public facilities 9,840,154 Redevelopment 3.078.318 Total investments in general fixed assets $63.017.773 116 ANNUAL DEBT SERVICE REQUIREMENTS The following schedules present principal and interest debt service requirements for the City's debt. 117 CITY OF CARLSBAD Schedule of Annual Debt Service Requirements $1.535.000 - 1969 CARLSBAD PARKING AUTHORITY REVENUE BONDS Fiscal Interest Due Year October 1 1993-94 1994-95 1995-96 $11,200 8,000 4.000 Total $23.200 Interest Due Aoril 1 8,000 4,000 Total Interest 19,200 12,000 4.000 Principal Due October 1 100,000 125,000 125.000 12.000 35.200 350.000 Total Annual Debt Service 119,200 137,000 129.000 385.200 $1.169.000 - 1981 CARLSBAD PARKING AUTHORITY REVENUE BONDS Fiscal Year 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 1999-00 2000-01 Total Interest Due August 1 $ 37,000 33,000 29,000 25,000 21,000 16,000 11,000 6.000 $178.000 Interest Due February 1 37,000 33,000 29,000 25,000 21,000 16,000 11,000 6.000 178.000 Total Interest 74,000 66,000 58,000 50,000 42,000 32,000 22,000 12.000 356.000 Principal Due February 1 100,000 100,000 100,000 100,000 125,000 125,000 125,000 150.000 925.000 Total Annual Debt Service 174,000 166,000 158,000 150,000 167,000 157,000 147,000 162.000 1.281.000 118 CITY OF CARLSBAD Schedule of Annual Debt Service Requirements, (Continued) $12.000.000 - 1988 CARLSBAD HOUSING AND REDEVELOPMENT COMMISSION TAX ALLOCATION BONDS Fiscal Year 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 Interest Due October 1 • $ 415,414 406,111 395,799 384,261 371,531 357,559 1999-2000 342,159 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 Total 325,296 306,681 286,332 263,870 239,550 213,330 184,830 154,050 119,925 83,070 43.095 $4.892.863 Interest Due Total Aoril 1 415,414 406,111 395,799 384,261 371,531 357,559 342,159 325,296 306,681 286,332 263,870 239,550 213,330 184,830 154,050 119,925 83,070 43.095 4.892.863 Interest 830,828 812,222 791,598 768,522 743,062 715,118 684,318 650,592 613,362 572,664 527,740 479,100 426,660 369,660 308,100 239,850 166,140 86.190 9.785.726 Principal Due October 1 305,000 330,000 355,000 380,000 405,000 440,000 475,000 510,000 550,000 595,000 640,000 690,000 750,000 810,000 875,000 945,000 1,025,000 1.105.000 11.185.000 Total Annual Debt Service 1 ,146,598 ,148,522 ,159,318 ,160,592 135,828 1,142,222 1, 1, 1,148,062 1,155,118 1, 1, 1,163,362 167,664 167,740 169,100 176,660 179,660 183,100 184,850 191,140 1.191.190 20.970.726 $9.570.250 - COLLEGE BOULEVARD ASSESSMENT DISTRICT BONDS Fiscal Interest Due Year September 2 1993-94 $ 1994-95 1995-96 1996-97 1997-98 1998-99 1999-2000 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 298,686 287,956 275,394 261,714 246,699 230,230 212,485 192,932 171,800 148,600 123,400 96,200 66,600 34.600 Total $2.647.296 Interest Due March 2 287,956 275,394 261,714 246,699 230,230 212,485 192,932 171,800 148,600 123,400 96,200 66,600 34,600_ 2.348.610 4 Total Interest 586,642 563,350 537,108 508,413 476,929 442,715 405,417 364,732 320,400 272,000 219,600 162,800 101,200 34.600 .995.906 119 Principal Due September 2 290,000 335,000 360,000 390,000 425,000 455,000 495,000 535,000 580,000 630,000 680,000 740,000 800,000 865.000 7.580.OOP Total Annual Debt Service 876,642 898,350 897,108 898,413 901,929 897,715 900,417 899,732 900,400 902,000 899,600 902,800 901,200 899.600 12.575.906 CITY OF CARLSBAD Schedule of Annual Debt Service Requirements, (Continued) $8.690.000 - 1988 HOSP GROVE CERTIFICATES OF PARTICIPATION Fiscal Interest Due Year Aueust 1 1993-94 $ 1994-95 1995-96 1996-97 1997-98 1998-99 1999-2000 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 299,324 290,730 281,143 270,590 259,205 246,780 233,100 217,930 201,400 182,600 162,200 140,000 116,000 90,400 62,600 36.600 Total $3.090.602 Interest Due February 1 290,730 281,143 270,590 259,205 246,780 233,100 217,930 201,400 182,600 162,200 140,000 116,000 90,400 62,600 36,600 2.791.278 Total Interest 590,054 571,873 551,733 529,795 505,985 479,880 451,030 419,330 384,000 344,800 302,200 256,000 206,400 153,000 99,200 36.600 5.881.880 Principal Due August 1 275,000 295,000 315,000 330,000 355,000 380,000 410,000 435,000 470,000 510,000 555,000 600,000 640,000 695,000 750,000 815.000 7.83Q.QOQ Total Annual Debt Service 865,054 866,873 866,733 859,795 860,985 859,880 861,030 854,330 854,000 854,800 857,200 856,000 846,400 848,000 849,200 851.600 13.711.880 $14.370.000 - 1988 CARLSBAD MUNICIPAL WATER DISTRICT CERTIFICATES OF PARTICIPATION Fiscal Year 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 1999-2000 2000-01 2001-02 2002-03 2003-04 Total Interest Due November 1 $ 399,348 375,624 350,049 322,411 292,491 260,061 224,886 186,724 145,144 100,375 52.012 $2.709.125 Interest Due Mav 1 399,348 375,624 350,049 322,411 292,491 260,061 224,886 186,724 145,144 100,375 52.012 2.709.125 Total Interest 798,696 751,248 700,098 644,822 584,982 520,122 449,772 373,448 290,288 200,750 104.024 5.418.250 Principal Due Mav 1 730,000 775,000 825,000 880,000 940,000 1,005,000 1,075,000 1,155,000 1,235,000 1,325,000 1.425.000 11,370.000 Total Annual Debt Service 1,528,696 1,526,248 1,525,098 1,524,822 1,524,982 1,525,122 1,524,772 1,528,448 1,525,288 1,525,750 1.529.024 16.788.250 120 CITY OF CARLSBAD Schedule of Annual Debt Service Requirements, (Continued) $12,689,800 - ENCINA FINANCING JOINT POWERS AUTHORITY INSTALLMENT PURCHASE AGREEMENT Fiscal Interest Due Year 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 1999-2000 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 August 1 $ 422,226 413,850 404,866 395,142 384,738 373,586 361,615 348,749 334,979 320,166 304,297 287,229 268,543 248,555 227,201 204,349 179,933 153,891 126,025 96,272 66,172 34.101 Interest Due February 1 413,850 404,866 395,142 384,738 373,586 361,616 348,749 334,979 320,167 304,296 287,229 268,543 248,555 227,201 204,349 179,933 153,891 126,025 96,273 66,172 34,101 - Total Interest 836,076 818,716 800,008 779,880 758,324 735,202 710,364 683,728 655,146 624,462 591,526 555,772 517,098 475,756 431,550 384,282 333,824 279,916 222,298 162,444 100,273 34.101 Principal Due August 1 274,630 289,782 308,722 327,662 348,496 371,224 395,846 420,468 448,878 477,288 509,486 543,578 581,458 621,232 664,794 710,250 757,600 810,632 865,558 926,166 986,774 1.049.276 Total Annual Debt Service 1,110,706 1,108,498 1,108,730 1,107,542 1,106,820 1,106,426 1,106,210 1,104,196 1,104,024 1,101,750 1,101,012 1,099,350 1,098,556 1,096,988 1,096,344 1,094,532 1,091,424 1,090,548 1,087,856 1,088,610 1,087,047 1.083.377 Total $5.956.485 5.534.261 11.490.746 12.689.800 24.180.546 121 122 123 CITY OF CARLSBAD General Expenditures by Function Last Ten Fiscal Years Fiscal Year 1983-84 1984-85 1985-86 1986-87 1987-88 1988-89 1989-90 1990-91 1991-92 1992-93 (1) (2) Total (1) $ 16,753,893 22,279,729 36,206,852 49,443,365 41,960,153 55,745,009 53,133,603 72,999,324 53,985,119 55,104,390 General Government 2,551,209 3,008,056 4,124,793 5,645,325 5,988,144 7,139,089 7,920,471 10,437,609 6,324,697 6,775,830 Public Safety 5,813,451 7,020,105 7,851,268 9,452,556 10,102,111 11,728,140 13,836,529 16,108,745 15,647,112 15,341,646 Includes General, Special Revenue, Public Works (2) 3,408,568 2,974,480 6,412,310 4,601,389 5,375,688 6,336,093 7,402,476 6,519,035 12,810,175 11,737,019 Debt Service and Includes community development and utilities and 1991-92, as well as public works expenditures. Welfare 825,236 860,556 1,052,394 1,321,504 1,584,897 1,614,015 1,808,058 2,077,563 2,287,271 2,711,467 Capital Culture/ Recreation 2,764,121 3,278,290 3,710,505 4,530,701 5,358,475 5,808,094 7,413,870 7,183,567 7,301,171 6,686,110 Projects Funds. maintenance categories Capital Projects 1,0*33,261 4,619,242 12,333,087 23,032,108 11,216,835 19,786,724 11,104,390 26,665,164 5,639,898 7,195,427 added in Debt Service 358,047 519,000 722,495 859,782 2,334,003 3,332,854 3,647,809 4,007,641 3,974,795 4,656,891 GENERAL EXPENDITURES BY FUNCTION 1992-93 GENERAL GOVERNMENT 12% $6.78 DEBT SERVICE 8% $4.66 CAPITAL PROJECTS 13% $7.2 CULTURE/RECREATION 12% $669 WELFARE 5% $2.71 DOLLARS IN MILLIONS PUBLIC SAFETY 28% $15.34 PUBLIC WORKS 21% $11.74 Source: City of Carlsbad Comprehensive Annual Financial Reports 124 TOTAL EXPENDITURES LAST TEN YEARS DOLLARS IN MILLIONS $80-1' $60- $40- $20- 1984 1985 1986 19871988 1989 1990 19911992 1993 FISCAL YEAR INCLUDES GENERAL, SPECIAL REVENUE, DEBT SERVICE AND CAPITAL PROJECT FUNDS SPENDING ON CAPITAL PROJECTS LAST TEN YEARS DOLLARS IN MILLIONS 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 FISCAL YEAR 125 CITY OF CARLSBAD General Revenues by Source Last Ten Fiscal Years Fiscal Year 1983-84 1984-85 1985-86 1986-87 1987-88 1988-89 1989-90 1990-91 1991-92 1992-93 Total CD $ 23,870,285 31,272,744 37,078,236 45,626,319 42,944,962 54,565,025 57,970,453 77,371,107 58,440,436 58,115,465 Property Taxes 4,848,041 5,243,124 6,769,473 8,516,463 8,882,813 11,012,396 12,677,817 14,007,364 15,132,124 15,332,036 Sales Taxes 4,891,379 5,726,373 6,222,008 6,487,371 7,128,461 8,186,215 9,342,077 9,426,111 8,723,382 9,167,849 Transient Occupancy Taxes 1,007,268 1,041,947 1,157,794 1,729,998 1,995,447 2,752,025 3,630,662 3,310,043 3,077,595 3,098,793 Other Taxes 1,969,434 2,084,724 1,807,457 1,987,299 4,205,570 3,648,826 4,114,856 3,691,387 5,153,213 3,408,805 Business Licenses 351,875 428,546 471,470 517,972 616,278 696,706 791,715 832,432 910,532 1,071,342 (1) Includes General, Special Revenue, Debt Service and Capital Projects Funds. (2) Included interdepartmental services category added in 1991-92 and miscellaneous revenues. GENERAL REVENUE LAST TEN YEARS PROPERTY TAX AND SALES TAX REVENUE LAST TEN YEARS DOLLARS IN MILLIONS DOLLARS IN MILLIONS 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 FISCAL YEAR 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 FISCAL YEAR • PROPERTY TAX @ SALES TAX Source: City of Carlsbad Comprehensive Annual Financial Reports 126 Other Licenses 2,099,942 3,042,110 3,525,394 3,830,931 3,521,242 3,858,173 4,058,540 3,550,013 3,307,980 3,355,533 Intergov- emmental 1,777,587 2,060,542 2,924,892 5,608,869 2,506,690 2,876,536 3,267,054 5,405,074 6,087,138 7,107,385 Charges for Services 4,747,951 8,541,600 9,814,416 12,678,062 8,770,867 7,722,568 10,728,326 10,701,989 7,759,224 5,725,597 Fines and Forfeits 256,471 345,750 288,055 366,597 435,649 478,830 511,890 515,746 312,984 231,877 Interest 1,542,092 2,638,536 2,857,221 2,944,741 3,422,839 5,644,873 6,002,986 5,737,513 4,826,292 4,866,361 Contributions From Property Owners - - - - 175,593 4,529,710 402,292 16,515,962 446,813 380,389 Other f21 378,245 119,492 1,240,056 958,016 1,283,513 3,158,167 2,442,238 3,677,473 2,703,159 4,369,498 TRANSIENT OCCUPANCY TAX LAST TEN YEARS DOLLARS IN MILLIONS CHARGES FOR SERVICES LAST TEN YEARS DOLLARS IN MILLIONS 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 FISCAL YEAR 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 RSCAL YEAR Source: City of Carlsbad Comprehensive Annual Financial Reports 127 CITY OF CARLSBAD Ratio of General Bonded Debt to Assessed Valuation and Net Bonded Debt Per Capita Last Ten Fiscal Years Fiscal Year 1983-84 1984-85 1985-86 1986-87 1987-88 1988-89 1989-90 1990-91 1991-92 1992-93 Net Assessed Valuation CD $ 2,194,598,447 2,495,887,152 2,894,233,860 3,458,390,377 3,939,249,294 4,203,469,146 4,850,671,236 5,474,063,206 5,909,991,722 6,066,896,498 Outstanding Principal C2") 915,000 900,000 785,000 670,000 550,000 420,000 285,000 150,000 - - Percent of Total Valuation 0.04 0.03 0.03 0.02 0.01 0.01 0.01 - - - Per Capita Debt 23 20 16 12 9 7 4 2 - - Population C3) 40,665 44,566 48,872 55,282 58,888 62,030 63,451 64,264 65,661 67,172 (1) Net assessed value is stated at 100% of market value. Data from County of San Diego Office of the Auditor and Controller. (2) Library and sewer general obligation bonds per the City of Carlsbad Comprehensive Annual Financial Reports. (3) Population as of January 1 of each year per the State Department of Finance. GENERAL BONDED DEBT PER CAPITA LAST TEN YEARS DEBT IN DOLLARS $100 $80- $60 $40 $20- 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 FISCAL YEAR 128 CITY OF CARLSBAD Computation of Legal Debt Margin June 30, 1993 25% of net assessed valuation (1) $ 1.516.724.125 Debt limit (15% of net assessed valuation as adjusted) 227.508.619 Amount of debt applicable to debt limit: Bonded debt (2) 20,040,000 Certificates of participation 7,830,000 Obligations under capital leases 874.288 Total amount of debt applicable to debt limit 28.744.288 Legal debt margin $ 198.764.331 Percent of debt limit 13% (1) Beginning January 1,1987, a change in state law required the County Assessor to assess all taxable property at 100% of full value as opposed to the prior practice of assessing property at 25% of full value. To be consistent with previous years, the assessed valuation used for this computation is at 25% of full value. (2) Total bonded debt: Parking and Building Authorities $ 1,275,000 College Boulevard Assessment District 7,580,000 Tax Allocation Bonds 11.185.000 Total bonded debt $ 20.040.000 129 CITY OF CARLSBAD Schedule of Direct and Overlapping Bonded Debt June 30, 1993 1992-93 Total Assessed Valuation: $6,159,027,618 (after deducting $157,710,307 redevelopment incremental valuation) Direct and Overlapping Bonded Debt: San Diego County Building Authorities San Diego County Water Authority Metropolitan Water District Carlsbad Unified School District Carlsbad Unified School District Authority Carlsbad Unified School District Community Facilities District #1 San Marcos Unified School District and Certificates of Participation San Dieguito Union High School District Encinitas Union School District, Authority and Certificates of Participation Mira Costa Community College District Certificates of Participation Other School Districts Tri-City Hospital District Palomar Pomerado Hospital District and Authority Leucadia County Water District and I.D. #1 Vallecitos Water District and LD.'s #1, 2 & 6 Carlsbad Municipal Water District Certificates of Participation Olivenhain Municipal Water District, I.D. #1 City of Carlsbad Building Authorities City of Carlsbad 1915 Act Bonds TOTAL DIRECT AND OVERLAPPING BONDED DEBT (1) Applicable 4.742% 4.921 0.779 97.086 97.057 100.000 25.260 7.844 23.882 24.763 Various 31.815 0.702 50.611 & 1.633 6.604 - 10.868 100.000 30.991 100.000 100.000 $ 16,880,714 734,213 5,447,158 54,321 13,136,665 12,110,000 2,897,273 62,752 3,280,192 637,647 71,336 400,869 76,237 140,976 83,588 11,370,000 252,577 9,105,000 30.440.000 $107,181,518 (1) Excludes tax and revenue anticipation notes, revenue, mortgage revenue and tax allocation bonds and non- bonded capital lease obligations. Ratios to Assessed Valuation: Direct Debt ($9,105,000) 0.15% Total Debt 1.74% Share of Authorized and Unsold General Obligation Bonds: Metropolitan Water District $389,500 Carlsbad Municipal Water District, I.D. #1 $98,867 Carlsbad Municipal Water District, I.D. #3 $200,000 State School Building Aid Repayable as of 6/30/93: $140,447 Source: California Municipal Statistics, Inc. 130 CITY OF CARLSBAD Ratio of Annual Debt Service for General Bonded Debt to Total Governmental Expenditures Last Ten Fiscal Years Fiscal Year 1983-84 1984-85 1985-86 1986-87 1987-88 1988-89 1989-90 1990-91 1991-92 1992-93 Principal $ 15,000 (3) 115,000 115,000 115,000 120,000 130,000 135,000 135,000 150,000 -0- Interest (4> 38,022 33,723 29,727 27,505 23,179 18,556 13,728 8,652 3,908 -0- Total Debt Service (1) 53,022 148,723 144,727 142,505 143,179 148,556 148,728 143,652 153,908 -0- Total Governmental Expenditures (2) 16,723,893 22,297,729 36,206,852 49,443,365 41,960,153 55,745,009 53,133,603 72,999,324 53,985,119 55,104,390 Ratio of Debt Service to Governmental Expenditures % 0.3 0.7 0.4 0.3 0.3 0.3 0.3 0.2 0.3 - (1) Debt service requirement on General Obligation Bonds comprised of 1962 Sewer Bonds Series B and C and 1966 Library Bonds. Excludes debt service for the Assessment District and the Building and Parking Authorities. (2) Includes General, Special Revenue, Debt Service and Capital Project funds. (3) In 1983-84, the City began recording principal payments in the year they became payable. The general obligation principal payments for the City's Sewer Bonds are due July 1 and had previously been recorded as paid by the City on June 30 each year. (4) Includes interest in the fiscal year that it becomes due. RATIO OF DEBT SERVICE TO GENERAL EXPENDITURES LAST TEN YEARS 0.8% 0.7%- 0.6%- 0.5%- 0.4%- 0.3%- 0.2%- 0.1%- 0.0% 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 FISCAL YEAR Source: City of Carlsbad Comprehensive Annual Financial Reports 131 CITY OF CARLSBAD Revenue Bond Coverage Water Utility Last Ten Fiscal Years Fiscal Year 1983-84 1984-85 1985-86 1986-87 1987-88 1988-89 1989-90 1990-91 1991-92 1992-93 CD Gross Revenue $ 1,672,564 1,371,214 1,522,383 1,532,953 1,637,819 1,760,102 2,001,832 11,398,343 11,504,798 12,267,854 (2) Direct Operating Expenses 1,557,173 1,119,336 1,317,953 933,368 1,334,525 1,195,822 1,415,542 9,172,478 9,520,564 11,421,571 Net Revenue Available For Debt Service 115,391 251,878 204,430 599,585 303,294 564,280 586,290 2,225,865 1,984,234 846,283 Debt Service Requirements Principal - (3) 125,000 130,000 140,000 150,000 157,000 160,000 775,000 685,000 730,000 Interest 56,875 50,138 42,531 38,549 29,096 21,211 12,718 1,088,386 842,538 798,696 Total 56,875 175,138 172,531 178,549 179,096 178,211 172,718 1,863,386 1,527,538 1,528,696 Coverage 2.03 1.44 1.18 3.36 1.69 3.17 3.39 1.19 1.29 0.55 (1) Includes operating and non-operating revenues. (2) Total operating expenses including depreciation and amortization. (3) In 1983-84 the City began recording principal payments for the Water Revenue bonds in the year they became payable. In prior years principal payments had been recorded as paid on June 30 of each year rather than July 1 of the following year. (4) Effective January 1, 1990, Carlsbad Municipal Water District (CMWD) became a subsidiary district of the City. Thus all amounts have been adjusted accordingly. Debt service requirements after that date include the Improvement District bonds and the Certificates of Participation issued by CMWD. Source: City of Carlsbad Comprehensive Annual Financial Reports 132 WATER ENTERPRISE GROSS REVENUE VS. DIRECT OPERATING EXPENSES LAST TEN YEARS DOLLARS IN MILLIONS 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 FISCAL YEAR • GROSS REVENUE H OPERATING EXPENSES NET REVENUE AVAILABLE FOR DEBT SERVICE LAST TEN YEARS DOLLARS IN THOUSANDS $2500 -( 1984198519861987198819891990199119921993 FISCAL YEAR 133 CITY OF CARLSBAD Demographic Statistics Last Ten Fiscal Years Year 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1995 (Estimate) 2000 (Estimate) 2010 (Estimate) Square Miles 32.0 35.6 36.0 39.7 39.7 39.7 42.2 42.2 42.2 42.2 Population (1) 40,665 44,566 48,872 55,282 58,888 62,030 63,451 64,264 65,661 67,172 77,310 (3) 84,954 (3) 100,826 (3) Population Percent Chanee 4.2 9.6 9.7 13.1 6.5 5.3 2.3 1.3 2.2 2.3 County Population (2) 2,041,362 2,083,359 2,166,169 2,240,659 2,327,657 2,418,176 2,509,914 2,548,728 2,602,244 2,648,597 (4) (4) (4) City Population Percent of County 2.8 2.1 2.3 2.5 2.5 2.6 2.5 2.5 2.5 2.5 (1) Source - State Department of Finance. (2) Source - County Data Base, San Diego County. (3) Population for City General Plan area - San Diego Association of Governments Series VII population forecast. (4) County future population estimate not available. POPULATION LAST TEN YEARS THOUSANDS 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 FISCAL YEAR POPULATION AS OF JANUARY 1 PER STATE DEPARTMENT OF FINANCE 134 135 CITY OF CARLSBAD Schedule of Assessed Valuation Last Ten Fiscal Years Fiscal Year 1983-84 1984-85 1985-86 1986-87 1987-88 1988-89 1989-90 1990-91 1991-92 1992-93 Secured Property $ 2,195,611,840 2,487,497,173 2,893,268,927 3,456,419,183 3,937,879,614 4,197,767,148 4,813,718,827 5,406,790,697 5,823,039,810 5,948,358,026 Unsecured Property 57,309,394 75,231,054 77,524,350 80,781,420 98,879,688 109,633,027 147,696,674 182,042,779 205,094,661 242,255,869 Less Property Exemptions 8,401,587 14,605,675 18,616,217 19,248,842 21,859,608 20,083,629 23,581,665 25,387,503 27,414,635 31,586,277 NET TAXABLE VALUE LAST TEN YEARS DOLLARS IN BILLIONS 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 FISCAL YEAR Source: City of Carlsbad Comprehensive Annual Financial Reports 136 Total Assessed Valuation 2,244,519,647 2,548,122,552 2,952,177,060 3,517,951,761 4,014,899,694 4,287,316,546 4,937,833,836 5,563,445,973 6,000,719,836 6,159,027,618 Homeowner's Exemptions 49,921,200 52,235,400 57,943,200 65,492,000 75,650,400 83,847,400 87,162,600 89,382,767 90,728,114 92,131,120 Net Assessed Valuation 2,194,598,447 2,495,887,152 2,894,233,860 3,452,459,761 3,939,249,294 4,203,469,146 4,850,671,236 5,474,063,206 5,909,991,722 6,066,896,498 Percentage Change 8.9 13.7 16.0 19.3 14.1 6.7 15.4 12.9 8.0 2.7 137 CITY OF CARLSBAD Construction and Business Activity Last Ten Fiscal Years Fiscal Year 1983-84 1984-85 1985-86 1986-87 1987-88 1988-89 1989-90 1990-91 1991-92 1992-93 Building Permit Revenue $ 1,068,876 1,055,738 1,397,129 1,230,100 671,779 674,814 1,029,750 857,717 219,445 234,063 Percent Change 118.1 (1.2) 32.3 (12.0) (45.4) .5 52.6 (16.7) (74.4) 6.7 Estimated Valuation 198,520,304 213,403,469 263,548,719 245,661,491 127,831,606 111,898,109 169,746,343 163,340,462 42,351,906 49,809,414 License Revenue 351,875 428,546 471,470 517,972 616,278 696,706 791,715 832,432 910,532 1,071,342 License Percent Change 25.7 21.8 10.0 9.9 19.0 13.1 13.6 5.1 9.4 17.7 ESTIMATED BUILDING VALUATION LAST TEN YEARS DOLLARS IN MILLIONS 19841985 1986 1987 1988 198919901991 1992 1993 FISCAL YEAR INCLUDES GENERAL. SPECIAL REVENUE, DEBT SERVICE AND CAPITAL PROJECT FUNDS Source: City of Carlsbad Comprehensive Annual Financial Reports 138 CITY OF CARLSBAD Property Tax Levies and Collections Last Ten Fiscal Years Fiscal Year 1983-84 1984-85 1985-86 1986-87 1987-88 1988-89 1989-90 1990-91 1991-92 1992-93 Total Current Lew 4,972,861 5,565,653 6,742,713 8,077,224 9,368,469 10,928,048 12,600,253 13,931,230 14,932,937 13,990,844 Total Current Collections 4,653,350 5,170,614 6,263,242 7,488,152 8,733,089 10,237,929 11,816,888 12,986,628 13,795,525 12,776,232 % of Levy Collected 93.6 92.9 92.9 92.7 93.2 93.7 93.8 93.2 92.4 91.3 PROPERTY TAX LEVIES AND COLLECTIONS LAST TEN YEARS DOLLARS IN MILLIONS $16-fl 1984 1985 1986 1987 1988 1989 1990 19911992 1993 FISCAL YEAR •TOTAL LEVY 0 AMOUNT COLLECTED 139 CITY OF CARLSBAD Special Assessment Billings and Collections College Boulevard Assessment District Last Seven Fiscal Years Fiscal Special Assessment Special Assessments Year Billings Collected Prior to 1987 N/A N/A 1987 $ 1,000,362 996,884 1988 988,116 987,682 1989 984,718 985,207 1990 985,680 985,670 1991 986,080 760,329 1992 940,780 758,864 1993 508,080 421,592 Note: There were no special assessment billings for the College Boulevard Assessment District prior to the fiscal year ended June 30, 1987. Source: City of Carlsbad Comprehensive Annual Financial Reports 140 CITY OF CARLSBAD Principal Employers 1992-1993 Firm Manufacturing: Callaway Golf Hughes Aircraft Company The Upper Deck Puritan-Bennett Corporation Cobra Golf Smith & Nephew DonJoy Inc. Charter Golf Taylor Made Golf Co., Inc. Beckman Instruments International Totalizer Systems Intelligent Medical Systems Dyna Corporation Hughes JVC Technology Corporation Eaton-Leonard Corporation Calcitek, Inc. Melles Griot Laser Products Golf Equipment 900 Electronic Equipment 840 Entertainment Cards 675 Medical Equipment 550 Golf Equipment 300 Orthopedic Braces 300 Golf Apparel 250 Golf Equipment 240 Medical Diagnostic Reagent 200 Export Off Track Betting Systems 170 Ear Thermometers 170 Medical Products & Printing Co. 155 Large Screen Display Projector 155 Vending Machines 150 Dental Implants 150 Gas Lasers 150 Non-Manufacturing: Plaza Camino Real La Costa Hotel & Spa Carlsbad Unified School District Car Country Carlsbad City of Carlsbad Farmer's Insurance - Regional San Diego Gas & Electric Isis Pharmaceuticals Best Western Andersen's Inn Shopping Mall (5 major Dept. Stores) 3,000 Hotel & Health Spa 1,200 Education 540 Car Dealerships 500 Municipal Government 483 Insurance 420 Utility Company 270 Research and Development 185 Hotel/Restaurant 170 Source: City of Carlsbad Chamber of Commerce 141 CITY OF CARLSBAD Principal Taxpayers 1992-93 Taxpayer San Diego Gas & Electric Co. Fieldstone/La Costa Associates La Costa Hotel & Spa Corp. Hughes Aircraft Company Aviara Land Associates Limited Lyon/Copley Carlsbad Associates Puritan-Bennett Corporation Aviara Resort Associates Limited Upland Industries Corp. Plaza Camino Real Type of Business Power Generation Land Developer Hotel & Health Spa Manufacturer Land Developer Land Developer Manufacturer Land Developer Land Developer Shopping Center Valuation $ 328,515,295 177,486,963 148,582,543 92,402,832 60,709,825 41,922,080 34,295,000 30,992,704 30,818,133 29.896.933 $ 975,622,308 Percentage of total Net Assessed Valuation (1) 5.4% 2.9 2.4 1.5 1.0 0.7 0.6 0.5 0.5 05 16.1% (1) Net assessed valuation for 1992-93 - $6,066,896,498 142 CITY OF CARLSBAD Miscellaneous Statistical Information 1992-93 Date of Incorporation Type of City Form of Government Area Population Number of Streets Miles of Streets Fire Protection: Number of Stations Number of Firefighters & Officers Police Protection: Number of Stations Number of Sworn Police Officers Municipal Water District: Number of Customers Average Daily Consumption Miles of Lines and Mains Miles of Sewers Recreation and Culture: Number of Parks (Improved and Unimproved) Area of Parks Number of Pools Number of Libraries Number of Volumes Total Number of Full Time City Employees July 16, 1952 General Law Council/Manager 42.19 sq. miles 67,172 4,516 238 6 72 1 77 17,307 13.04 million gallons 325 113 36 326.88 acres 1 2 207,711 483 143 144