HomeMy WebLinkAbout; ; 2002-2003 CAFR; 2003-06-30COMPREHENSIVE ANNUAL
FINANCIAL REPORT
FISCAL YEAR ENDED
JUNE 30, 2003
1635 Faraday Avenue, Carlsbad, CA 92008
Website: www. ci. carlsbad. ca. us
Prepared by the Finance Department
Photos on Cover: Top left to bottom right: Fire vehicles in front of original fire station (early 1960's), Twin Inns (1970's),
Carlsbad High School Junior Varsity cheerleaders (1959), Carlsbad's Little league (1960's), Building department
Christmas card (1974), Carlsbad Triathlon professional division swim start (2001), Architectural rendering of Carlsbad
City Hall Administration Building
CITY OF CARLSBAD
Comprehensive Annual Financial Report
Year Ended June 30, 2003
TABLE OF CONTENTS
Page
INTRODUCTORY SECTION:
Table of Contents i
City Council's Five-Year Vision Statements 1
Letter of Transmittal 3
Certificate of Achievement for Excellence in Financial Reporting, Government Finance Officers
Association 10
Location Map 11
List of City Officials 12
Organization Chart 13
FINANCIAL SECTION:
Independent Auditor's Report 15
Management's Discussion and Analysis 17
Basic Financial Statements
Government-wide Financial Statements:
Statement of Net Assets 30
Statement of Activities 32
Fund Financial Statements:
Balance Sheet - Governmental Funds 34
Reconciliation of the Balance Sheet of Governmental Funds to the Statement
of Net Assets 36
Statement of Revenues, Expenditures and Changes in Fund Balances -
Governmental Funds 38
Reconciliation of the Statement of Revenues, Expenditures and Changes in
Fund Balances of Governmental Funds to the Statement of Activities 40
Statement of Revenues, Expenditures and Changes in Fund Balance -
Budget to Actual - General Fund 42
Statement of Net Assets - Proprietary Funds 44
Statement of Revenues, Expenses and Changes in Net Assets - Proprietary Funds 48
Statement of Cash Flows - Proprietary Funds 50
Statement of Net Assets - Fiduciary Funds 54
Statement of Changes in Net Assets 55
Notes to the Financial Statements 56
Supplementary Information
Combining and Individual Fund Statements and Schedules:
Combining Balance Sheet - Nonmajor Governmental Funds 84
Combining Statement of Revenues, Expenditures and Changes in Fund
Balances - Nonmajor Governmental Funds 88
Combining Schedule of Revenues and Expenditures - Budget and Actual
(Budgetary Basis) - Special Revenue Funds 92
Combining Schedule of Revenue and Expenditures - Budget and Actual
(Budgetary Basis) - Debt Service Funds 94
Combining Statement of Net Assets - Internal Service Funds 96
Combining Statement of Revenues, Expenses and Changes in Net Assets -
Internal Service Funds 98
Combining Statement of Cash Flows - Internal Service Funds 100
Combining Statement of Net Assets - Fiduciary Funds 104
Combining Statement of Changes hi Net Assets - Fiduciary Funds 105
Schedule of Annual Debt Service Requirements 106
CITY OF CARLSBAD
Comprehensive Annual Financial Report
Year Ended June 30, 2003
TABLE OF CONTENTS (CONTINUED)
Page
STATISTICAL SECTION:
(Not covered by Independent Auditor's Report)
Government-wide Information:
Government-wide Expenses by Function 112
Government-wide Revenues 114
Fund Information:
General Governmental Expenditures by Function - Last Ten Fiscal Years 116
General Governmental Revenues by Source - Last Ten Fiscal Years 118
Computation of Legal Debt Margin 120
Schedule of Direct and Overlapping Bonded Debt 121
Construction and Business Activity - Last Ten Fiscal Years 122
Water Enterprise - Revenue Bond Coverage - Last Ten Fiscal Years 123
Schedule of Assessed Valuation - Last Ten Fiscal Years 124
Demographic Statistics - Last Ten Fiscal Years 126
Property Tax Levies and Collections - Last Ten Fiscal Years 127
Principal Employers, 2002 - 2003 128
Principal Taxpayers, 2002 - 2003 129
Top 30 Sales Tax Generators, 2002 - 2003 130
Miscellaneous Statistical Information, 2002 - 2003 131
Carlsbad City Council
2003
Five-Year Vision Statements
City Council continues to clarify and pursue the vision of
Carlsbad that reflects the pride and quality of life for all
who live, work, and play here.
Carlsbad's...
4 diverse and healthy economic base provides opportunities for employment to the residents of Carlsbad,
economic vitality to the community, and the necessary revenues to support City services.
4 policies and decisions implement the General Plan, enforce the Growth Management Plan, maintain the
safety and security of its citizens, and are based on what is best for Carlsbad.
4 leadership role in local and regional planning issues actively involves addressing governmental issues
at the local, state, and national levels.
4 open government provides for the betterment of the community in a non-partisan manner while
encouraging active citizen participation and involvement with the City Council, and the City's Boards
and Commissions.
And Carlsbad efficiently and effectively...
* delivers top-quality public services.
4 manages environmental concerns proactively, including:
* open space
* water quality/conservation
» beach erosion
* air quality
» resource conservation and waste reduction
* wildlife habitats
4 has a safe and efficient integrated transportation system.
4 maintains Citywide "small town" community spirit.
4 has a community where continuous and life-long learning are supported and embraced for people of all
ages.
c
City of Carlsbad
Finance Department
October 15, 2003
Honorable Mayor, City Council,
and Citizens of the City of Carlsbad
CITY OF CARLSBAD
Carlsbad, California
LETTER OF TRANSMITTAL
2002-03 COMPREHENSIVE ANNUAL FINANCIAL REPORT
I am pleased to present the 2002-03 Comprehensive Annual Financial Report of the City of Carlsbad. The
information found in this report is provided by management to the City Council and the public to assist
those interested in understanding the fiscal condition of the City as of June 30, 2003. Responsibility for
both the accuracy of the data and the completeness and reliability of the presentation, including all
disclosures, rests with City management.
This report has been prepared using the financial reporting requirements prescribed by the Governmental
Accounting Standards Board (GASB) Statement No. 34 Basic Financial Statements- and Management's
Discussion and Analysis -for State and Local Governments. The report is organized into three sections:
1. Introductory Section - Provides the background and context so that the reader can fully understand
the information included in the rest of the report. The introductory section includes this transmittal
letter, the City's organizational chart, awards and recognitions given the City for its financial
reporting, and other relevant information.
2. Financial Section - Contains the basic financial statements for the City, management's discussion
& analysis (MD&A) of the basic financial statements as well as other financial information
necessary for the reader to assess the financial position of the City. This section also includes the
audit report from the independent auditing firm of McGladrey & Pullen, LLP.
3. Statistical Section - Provides a broad range of trend data covering key financial indicators from
the past ten fiscal years, as well as demographic and miscellaneous data about the City. This
information is provided to assist the reader in more fully understanding the financial condition of
the City.
To provide a reasonable basis for making the representations shown in this report, management of the City
has established a comprehensive internal control framework designed both to protect the City's assets from
loss, theft, or misuse and to compile sufficient reliable information for the preparation of the City's financial
statements in conformity with generally accepted accounting principles (GAAP). Because the cost of
internal controls should not outweigh their benefits, the City's comprehensive framework of internal
controls has been designed to provide reasonable rather than absolute assurance that the financial statements
will be free from material misstatement. As management, we assert that, to the best of our knowledge and
belief, this report is complete and reliable in all material respects.
Also, as a recipient of federal and state financial assistance, the City is required to have a "Single Audit"
performed by our independent audit firm. The Single Audit was designed to meet the special needs of
federal grantor agencies. The standards governing Single Audit engagements require that the independent
auditor report not only on the fair presentation of the financial statement, but also on the audited
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government's internal controls and compliance with legal requirements, with special emphasis on internal
controls and legal requirements involving the administration of federal awards. These reports are available
in the City's separately issued Single Audit Report. The results of the City's Single Audit for the fiscal year
ended June 30, 2003 noted no material weaknesses in the framework of internal controls or significant
violations of applicable laws and regulations.
PROFILE OF THE CITY OF CARLSBAD
Carlsbad incorporated in 1952 as a General Law city, although its "village" area dates back more than 100
years. It 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. The City
Council is elected at large on a staggered basis for a term of four years. The City Clerk and City Treasurer
are also elected to four-year terms. The City Council appoints the City Manager and City Attorney.
The City covers approximately 42 square miles and has
a population of 90,300, with an expected build-out
population of 120,000 residents. Industries in the area
include a regional shopping center; a major family
theme park, a specialty outlet center; an auto mall; 30
hotels offering 3,400 rooms for tourist lodging; high-
technology, multimedia, communication, and
biomedical businesses; electronics, golf apparel, and
equipment manufacturers; several business and light-
industry parks; and numerous land developers.
This report includes financial statements for the City,
the Housing Authority of the City of Carlsbad, the
Carlsbad Public Improvement Corporation, the Carlsbad
Redevelopment Agency, and the Carlsbad Municipal
Water District. Through these entities, Carlsbad
provides the following services to its citizens and
customers:
• Police department
• Development services
• Fire and paramedic services
• Street construction and maintenance
• Water delivery system
• Library and arts programs
Oregon
Carlsbad
• Sewer system
• Recreation programming for all ages
• Solid waste services
• Park lands
• Housing programs
School programs and facilities are provided by four different school districts located within the City boundaries.
Although the City Council has no direct control over these school districts, the City Council recognizes the
importance of quality school facilities and programs to Carlsbad's residents. The City Council has worked
closely with the schools in the past to provide assistance.
Budget Process
The Carlsbad Municipal Code requires
with a message describing important
features, and be responsible for the
budget's administration after
adoption. The budget process
begins in January each year with a
review and update of the City
Council's five-year vision
statements and strategic goals for
the City. The goals outline the
methods used to achieve the vision
and call out areas upon which the
City Council would like to place
special emphasis during the year.
Once these are developed, staff
develops operational goals based on
the City Council's direction. These
operational goals are the basis for
the development of the annual
budget.
Budgetary control for the City is
maintained through its accounting
systems. The City Council adopts
the formal budget at the beginning
of each year and may amend it
throughout the year as necessary.
Expenditures may not exceed
budgeted figures at the fund level.
Monthly reports summarizing the
results of operations for the City's
more significant funds are provided
to the City Council.
that the City Manager annually prepare a budget for the City Council
City of Carlsbad 2002-2003 Strategic Goals
Top Quality Services - Be a City that provides exceptional services on a
daily basis.
Transportation - Provide and maintain a multi-modal transportation
system, which includes public transportation, and which moves goods,
services and people through Carlsbad in a safe and efficient manner that is
coordinated with community development.
Balanced Community Development - Be a community that promotes
community spirit, quality neighborhoods, establishes compatible
residential and commercial uses, including entertainment venues, and
manages growth by providing an appropriate balance of facilities and
services.
Parks/Open Space/Trails - Acquire, develop and maintain a broad range
of fiscally responsible recreation and open space facilities that actively
address citizen needs and are consistent with the General Plan and Growth
Management Standards.
Water - Ensure reliable, high quality, diversified potable and recycled
water system leading to a drought-resistant community, in the most cost
effective manner.
Environmental Management - Be an environmentally sensitive
community by focusing on: Clean storm water, sewage collection and
treatment, solid waste and efficient use of energy including alternative
energy.
Finance. - Implement proactive strategies that provide and manage the
necessary resources to ensure a high quality of life.
Communication - Ensure that citizens, staff and Council are well
informed, leading to a more responsive government and a higher level of
confidence in government.
Learning - Promote and support continuous learning opportunities within
the community and the City organization.
FACTORS AFFECTING FINANCIAL CONDITION
Economic Profile
Diversification of San Diego County's employment base after the recession of the early 1990's has helped the
region to weather the recent economic malaise without the recent dramatic declines seen in northern California.
However, growth has been sluggish in the San Diego region since the downturn and it is difficult to tell when it
will begin to gain some momentum. The leading indicators for the San Diego region declined in June 2003 (the
most recent data available) after advancing slightly in the previous month. The indicators are published by the
University of San Diego School of Business Administration and according to their report, "The outlook for the
local economy remains weak at this point. Of particular concern is the deterioration in the job market, as
reflected in the loss of more than 11,000 nonfarm wage and salary jobs in June compared to the year before. It
was the third straight month where jobs have declined compared to the year before. While an increase in jobs is
Median SFD Home Prices
expected for the year as a whole, a lack of job growth in the national economy and turmoil in the state of
California over the state budget deficit and the recall of Governor Gray Davis may put that forecast hi
jeopardy."
Despite the lack of job growth, the housing market in the San Diego region and in Carlsbad remains strong.
This' is attributable, in part, to continued low mortgage interest rates for purchases and refinances, which has in
turn fueled both housing demand and consumer spending. In Carlsbad, the number of residential permits issued
in fiscal year 2004 is expected to total 715, just slightly lower than the previous year. The impediment to higher
development is mainly due to the lack of supply
rather than a lack of demand. With supply relatively
low, housing prices have continued to escalate.
Median prices for single-family homes averaged
$472,000 for calendar year 2002, an 11% increase
from the previous year. Total assessed values in the
City stand at over $14 billion, double what they were
just five years ago. Although this accelerated pace
will level out over the next few years, the City still
expects to add about 4,100 more residential units and
an additional 4.8 million square feet of
commercial/industrial development over the next five
years. The City's residential housing stock is about
80% built out, with approximately 9,000 housing
units remaining to develop.
500
400
300
200
100
0
1998 1999 2000 2001 2002
Carlsbad, like the region, has benefited from diversification of its employment base and its sources of revenue.
The City has been generating approximately 1,000 new jobs each year for the past five years. Some of the
major businesses in the City include the Gemological Institute of America, ViaSat, Invitrogen, Callaway, Taylor
Made, Upper Deck, and many others. Although commercial and industrial development has slowed over the past
year, it is expected that an additional 4.5 million square feet of commercial/industrial development will occur
over the next five years.
Tourism is also one of Carlsbad's major industries and major sources of revenue. The City is host to Legoland,
a family theme park, and has two luxury resorts available for its visitors, the Four Seasons Resort at Aviara and
the La Costa Resort and Spa, as well as numerous other quality hotels and motels. Tourism in Carlsbad, as in
the rest of the state, declined significantly following the terrorist attacks of September 11, 2001; however, we
are beginning to see signs of growth in this industry. Carlsbad's prime coastal location, its two premier resort
hotels, Legoland, the airport, and its many businesses make it a popular destination for both leisure and business
travelers.
For fiscal year 2003-04, the City's revenue projections reflect a return of consumer confidence with growth in
base sales taxes at about 5%. Housing values are expected to level out, with some softening in the market,
especially in the higher-end homes. Development is predicted at a rate similar to fiscal year 2003; again the
constraint is based on the limited supply, not on the demand. And finally, tourism is expected to slowly recover
over the year, with transient occupancy taxes possibly reaching 2001 's level by the end of 2004.
The most significant areas of risk in the forecast for Carlsbad lie with the economy and the State deficit. If the
economy does not pick up in the first half of 2004, sales taxes and transient occupancy taxes are most
susceptible to significant variances from the forecast, although all other revenues may also be affected.
A larger concern for the City's immediate financial future is the State's budget deficit and political instability.
The recall of the Governor is on the ballot for the November election with many of the candidates pledging to
repeal the increase in the Vehicle License fees (VLF), a local revenue source. In addition, the Legislative
Analyst's office estimates that the State will continue to have operating deficits cumulating to roughly $8 billion
by the close of 2004-05. The recently adopted State budget resulted in revenue losses to Carlsbad of over $1
million for the upcoming year mostly from VLF but also the result of miscellaneous deferrals and reductions and
$144,000 from the City's redevelopment agency. Since most of the City's significant revenue sources go
through the hands of a state agency, there are numerous ways in which the State can effect the City's future
revenues. The situation over the next few years at the State level promises to be a difficult one that could have
an adverse impact on the City's future revenues.
Long-Term Financial Planning
It is the City Council's goal to ensure that the City remains in good financial health, and the City has taken a
number of steps to attain that goal. One of these is the Growth Management Plan. This plan was adopted by the
citizens to ensure that all necessary public facilities were constructed along with development. It also ensures
that a financing plan is in place to pay for the facilities prior to the development of the property. Thus, the
initial capital facilities needed to support the growing population are provided without financially impacting the
City or its current residents. The City also prepares a 20+ year Capital Improvement Program. As part of the
Capital Improvement Program, the amounts needed to pay for the various projects as well as the operating
budget impacts are calculated. In this way, we can anticipate the effects of development from both a capital and
an operating perspective.
In order to assure that the City has the funds to replace these facilities as they age, an Infrastructure Replacement
fund was created. With this fund, the City has begun to set aside money on an annual basis for major
maintenance and replacement of its infrastructure. Much of the City's infrastructure is relatively new; therefore,
the City has not felt the full impact of maintenance. By setting aside funds now, the citizens of Carlsbad can be
assured that the proper maintenance and replacement, when needed, will be performed on streets, parks, and the
many facilities for which the City is responsible.
In addition to these steps, the City also prepares a long-term financial model for its operating needs. With a
growing city such as Carlsbad, it is imperative that we plan for the impacts of serving new development and
operating new public facilities, as well as planning for the capital needed to build them. Therefore, the City
prepares a ten-year operating forecast for the General fund and its major enterprise funds.
The City has experienced remarkable revenue growth over the past five to seven years due to the development of
the majority of its commercial sites. The future will bring a few more commercial sites but at a much slower
pace, while residential development will continue for a number of years. There are also a number of new
facilities - mainly parks - planned for the future to serve the growing population. The new facilities will add
operating costs to the City's General fund budget as they are completed and opened for use.
These factors alone will cause the General fund costs to escalate at a higher rate than inflation. In addition, a
number of other factors - mainly rising retirement and health care costs - will create upward pressure on
expenditures, especially over the next five years. These factors have been incorporated into the General fund
forecast, shown below, and projected over the next ten years. While no forecast is ever totally accurate, it does
represent a likely scenario given the assumptions on which it is built.
This forecast assumes that revenue growth will pick up at a moderate pace in 2004 and continue at that pace into
the future. It adds in known personnel costs, which have been negotiated with the employee groups. The City
has multi-year agreements with all the major employee groups so the effects can be projected fairly accurately.
It assumes 15% increases in health care costs in the near future but flattening out into the future. It also assumes
personnel growth (new positions) to remain rather flat at no more than 2% per year. And finally, it includes
estimated operating costs for all capital projects in the timeframes shown in the long-term capital improvement
program. One important point is that this forecast assumes the State does not take any additional revenues from
the City's General fund.
The results show that the General fund would
operate at a surplus until 2007, at which time
the forecast goes into a deficit and the deficit
continues to grow into the foreseeable future.
The surpluses are caused by the surge in
revenues that occurred over the past years.
The City's costs are projected to continue to
grow at a faster pace than revenues, so it will
eventually lead into deficits. If the State takes
$3.5 million from the City on a permanent
basis in fiscal year 2004 (not unlike the events
of the early 1990's), the budget would fall into
a deficit position by 2006.
General Fund
in thousands Revenues over Expenditures
$4 000
* '-*•*• ^
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2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Of course, the City does not allow for deficit spending, so it will need to balance the budget in the out years.
This can be done by reducing costs, raising revenues, or slowing the addition of new facilities until the revenues
have time to catch up. One of the goals adopted for fiscal year 2004 is to develop a comprehensive look at both
the revenue as well as the expense side of the General fund and to prepare a plan that provides for sustainable
economic health for the City of Carlsbad.
Cash Management
The City Treasurer is charged with the design of an effective cash management and investment program
consistent with the California Government Code, the Carlsbad Municipal Code, and the Carlsbad Investment
Policy. The City Council, with the advice of the City Treasurer, annually adopts a comprehensive investment
policy specifying, among other things, investment objectives and strategy, type, and term of investments,
reporting requirements, and investment oversight.
Investments are made either as pooled investments or as investments held separately. Pooled investments
include the inactive cash of agencies controlled by the City and the various funds of those agencies. Investments
held separately generally include bond proceeds and other funds, which are individually invested.
Pooled investments generally include federal agencies, corporate notes, and investments in the State Treasurer's
investment pool. The average life of the investments in the City's investment pool as of June 30, 2003 was 2
years, with a modified duration of 1.85. The average return on the pooled investments for fiscal year 2002-03
was 4.24%.
Investment income includes appreciation on the fair value of investments. Increases or declines in fair value
during the current year, however, do not necessarily represent trends that will continue, nor is it always possible
to realize such amounts, especially in the case of temporary changes in the fair value of investments that the City
intends to hold to maturity. The majority of the City's investments are held to maturity.
Risk Management
The City is exposed to various risks of loss related to its operations, including losses associated with errors and
omissions and injuries to employees and members of the public. The City maintains a combination of insurance
coverage and cash reserves to manage and finance its various types of risk. The City's self-insured retention for
both liability and Worker's Compensation insurance is $500,000. More information about the City's risk
management activity can be found in Note 14 of the notes to the financial statements.
Pension Benefits
The City of Carlsbad contributes to the California Public Employees' Retirement System (PERS), an agent
multiple-employer public employee defined benefit pension plan, for all of its full-time employees. PERS
provides retirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan
members and beneficiaries. Each year, an actuary engaged by PERS calculates the amount of the annual
contribution that the City must make to the pension plan to ensure that the plan will be able to fully meet its
obligations to retired employees on a timely basis. Due to the sluggish economy and the stock market decline
over the past few years, PERS has informed us that the City's contribution rate is expected to continue to
increase over the next several years. In addition, benefit enhancements in the fire safety plan and the
miscellaneous employee plan have been approved by the City Council as part of multi-year compensation
packages. These changes are expected to further increase the City's benefit contributions. For more information
on the funded status of the pension plans, please read Note 20 of the notes to the financial statements.
AWARDS AND ACKNOWLEDGEMENTS
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate
of Achievement for Excellence in Financial Reporting to the City of Carlsbad for its Comprehensive Annual
Financial Report (CAFR) for the fiscal year ended June 30, 2002. This was the fifth consecutive year that the
City has achieved this prestigious award. In order to be awarded a Certificate of Achievement, a government
unit must publish an easily readable and efficiently organized Comprehensive Annual Financial Report. This
report must satisfy both generally accepted accounting principles and applicable legal requirements. A
Certificate of Achievement is valid for a period of one year only. We believe our current Comprehensive
Annual Financial Report continues to meet the Certificate of Achievement Program's requirements, and we are
submitting it to GFOA to determine its eligibility for another certificate.
In addition to the GFOA award, 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, 2001. We believe our current report continues to conform to
the program requirements.
This report has been a joint effort by many people from many different areas of responsibility. It could not have
been accomplished without their help and the dedicated efforts of all of the accounting staff, especially Kevin
Branca, Assistant Finance Director, and Helga Stover, Senior Accountant. I also appreciate the staff of
McGladrey & Pullen, LLP for the professional way in which the audit of this financial report was conducted. It
has been a pleasure to work with them throughout this period. Additionally, I would like to thank the City
Council and the City's Leadership Team for their leadership and unfailing support in maintaining the highest
standards of professionalism in the management of the City of Carlsbad's finances.
Respectfully submitted,
c\i .*-—I V I, >•*
LISA HILDABRAND
Finance Director
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Carlsbad,
California
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
June 30, 2002
A Certificate of Achievement for Excellence in Financial
•Reporting is presented by the Government Finance Officers
Association of the United States and Canada to
government units and public employee retirement
systems whose comprehensive annual financial
reports (CAFRs) achieve the highest
standards in government accounting
and financial reporting.
President
Executive Director
10
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COUNTY
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11
CITY OF CARLSBAD
ELECTED CITY OFFICIALS
Claude A. "Bud" Lewis, Mayor
Ramona Finnila, Mayor Pro Tern
Ann J. Kulchin, Council Member
Matt Hall, Council Member
Mark Packard, Council Member
Lorraine M. Wood, City Clerk
James M. Stanton, City Treasurer
ADMINISTRATION AND DEPARTMENT HEADS
Raymond R. Patchett, City Manager
Frank Mannen, Assistant City Manager
James F. Elliott, Administrative Services Director
Lloyd Hubbs, Public Works Director
Sandra Holder, Community Development Director
Jim Hawks, Police Chief
Kevin Crawford, Fire Chief
Ron Ball, City Attorney
Julie Clark, Human Resources Director
Douglas Duncanson, Deputy Public Works Director, General Services
Debbie Fountain, Housing & Redevelopment Director
Robert J. Greaney, Deputy Public Works Director, Maintenance and Operations
Lisa Hildabrand, Finance Director
Michael Holzmiller, Planning Director
Pat Kelley, Principal Building Inspector
Clifford Lange, Library Director
Erin Letsch, Risk Manager
Ken Price, Recreation Director
Glenn Pruim, Deputy Public Works Director, Engineering Services
Aletha L. Rautenkranz, Information Systems Director
CHAIRPERSONS, COMMISSIONS AND BOARDS
Gary Hill Arts Commission
Ed Andrews Beach Preservation Committee
Don Polese Community Television Foundation
Sarah Marquez Design Review Board
Sue Ladouceur Historic Preservation Commission
Edward Scarpelli Housing Commission
Claude A. Lewis Housing and Redevelopment Commission
Jerry Tarman Library Board of Trustees
Jim Comstock Parks and Recreation Commission
Donald Martin Personnel Board
Julie Baker Planning Commission
Arthur Wood Senior Commission
VACANT Serra Cooperative Library System Advisory Board
Leonard Martyns Sister City Committee
Jim Courtney Traffic Safety Commission
Steve Jantz Utility Coordinating Commission
12
CITY OF CARLSBAD ORGANIZATION CHART Arts
Commission
Sister City
Committee
Historic
Preservation
CommissionELECTORATE
Library Board
of
TrusteesMAYOR
&
COUNCIL
CITY
TREASURERCITY CLERK
Serra Cooperative
Library System
Advisory Board
Parks & Kec
Commission
CITY MANAGER CITY ATTORNEY
Senior
Commission
COMMUNITY
DEVELOPMENT
COMMUNITY
SERVICES
PUBLIC
SAFETY
ADMINISTRA TIVE
SERVICES
PUBLIC
WORKS
ADMINISTRATION
HUMAN
RESOURCES
ENGINEERING
SERVICES
ECONOMIC
DEVELOPMENT
INFORMATION
TECHNOLOGY
GENERAL
SERVICES
GEOGRAPHIC
INFO SYSTEMS RECREATION
RISK
MANAGEMENT MAINTENANCE &
OPERATIONS
SENIOR
CENTER
HOUSING AND
REDEVELOPMENT
RECORDS
MANAGEMENT
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Board '
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Community i
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Foundation i
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Safety j —
Commission i
Underground I
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Housing
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Housing &
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Planning
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McGladrey&Pullen
Certified Public Accountants
Independent Auditor's Report
The Honorable Mayor and Members
of the City Council
City of Carlsbad
Carlsbad, California
We have audited the accompanying financial statements of the governmental activities, the business-type activities, each
major fund, and the aggregate remaining fund information of the City of Carlsbad, California (the City), as of and for the year
ended June 30,2003, which collectively comprise the City's basic financial statements as listed in the accompanying table of
contents. These financial statements are the responsibility of the City's management. Our responsibility is to express an
opinion on these basic financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the
standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the
United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used in the
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 financial statements referred to above present fairly, in all material respects, the respective financial
position of the governmental activities, the business-type activities, each major fund and the aggregate remaining fund
information of the City of Carlsbad, California, as of June 30,2003, and the respective changes in financial position and the
cash flows, where applicable, thereof and the respective budgetary comparison for the General fund for the year then ended in
conformity with accounting principles generally accepted in the United States of America.
In accordance with Government Auditing Standards, we have also issued our report dated September 30, 2003 on our
consideration of the City of Carlsbad's internal control over financial reporting and our tests of its compliance with certain
provisions of laws, regulations, contracts and grants. That report is an integral part of an audit performed in accordance with
Government Auditing Standards and should be read in conjunction with this report in considering the results of our audit.
The management's discussion and analysis and supplementary information on pages 17 to 28 and 84 to 109, are not a required
part of the basic financial statements but are supplementary information required by the Governmental Accounting Standards
Board. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the
methods of measurement and presentation of the supplementary information. However, we did not audit the information and
express no opinion on it.
Our audit was conducted for the purpose of forming an opinion on the financial statements that collectively comprise the
City's basic financial statements. The accompanying combining statements and schedules of annual debt service requirements,
listed in the table of contents as supplementary information, are been subjected to the auditing procedures applied in the audit
of the basic financial statements and, in our opinion, is fairly stated, in all presented for purposes of additional analysis and are
not a required part of the basic financial statements. This information has material respects, in relation to the basic financial
statements taken as a whole. The letter of transmittal and statistical tables have not been subjected to the auditing procedures
applied in the audit of the basic financial statements and, accordingly, we express no opinion on them.
San Diego, California
September 30, 2003
McGladrey & Pullen, LLP is an independent member firm of
RSM International, an affiliation of independent accounting
and consulting firms.
15
16
Management's Discussion and Analysis
As management of the City of Carlsbad ("City"), we offer readers of the City's financial statements this narrative
overview and analysis of the financial activities of the City for the fiscal year ended June 30, 2003. Our intent is to
assist the reader of these financial statements in better understanding the impact of financial decisions made by the
City. This analysis will focus on the significant changes in an effort to explain the City's overall financial condition.
We encourage readers to consider the information presented here in conjunction with the additional information
furnished in our letter of transmittal.
Overview of the Financial Statements
Required Components of the City of Carlsbad's
Annual Financial Report
Management 's
Discussion
and
Analysis
1
1
Basic
Financial
Statements
1
Required
Supplementary
Information
This section of the annual report consists of
four parts - management's discussion and
analysis (this section), the basic financial
statements, required supplementary
information, and an optional section that
presents combining statements for non-
major governmental funds and internal
service funds. The basic financial
statements include two kinds of statements
that present different views of the City.
• The first two statements are
Government-wide Financial Statements
that provide both long-term and short-
term information about the City's
overall financial status.
• The remaining statements are Fund
Financial Statements that focus on
individual parts of the City government,
reporting the City's operations in more
detail than the Government-wide
Statements.
- The Governmental Funds
Statements detail how general
government services such as public
safety were financed in the short term as well as what remains for future spending.
- Propriety Fund Statements offer short- and long-term financial information about the activities the City
operates like businesses, such as the water and sewer services.
- Fiduciary Fund Statements provide information about the financial relationships - such as contractor and
miscellaneous deposits - in which the City acts solely as a trustee or agent for the benefit of others to
whom the resources belong.
The financial statements also include notes that explain some of the information in the financial statements and
provide more detailed data. The statements are followed by a section of required supplementary information that
further explains and supports the information in the financial statements. In addition to these required elements, we
have included a section with combining statements that provide detail about our non-major governmental funds,
internal service funds, and fiduciary funds, which are added together and presented in single columns in the basic
financial statements.
The remainder of this overview section of management's discussion and analysis explains the structure and contents
of each of the statements.
1
Government-
wide Financial
Statements
1
Fund
Financial
Statements
Notes
to the
Financial
Statements
Summary Detail
17
Government-wide Financial Statements
The Government-wide Financial Statements report information about the City as a whole using accounting methods
similar to those used by private-sector companies. The Statement of Net Assets includes all of the City's assets and
liabilities. All of the current year's revenues and expenses are accounted for in the Statement of Activities
regardless of when cash is received or paid.
The two Government-wide Financial Statements report the City's net assets and how they have changed. Net assets
• the difference between the City's assets and liabilities - are one way to measure the City's financial health, or
position. Over time, increases or decreases in the City's net assets are an indicator of whether the City's financial
health is improving or deteriorating, respectively. One needs to consider additional non-financial factors, such as
changes in the City's property tax base and the condition of the City's infrastructure, to assess the overall health of
the City.
The Government-wide Financial Statements of the City are divided into two categories:
• Governmental activities - Most of the City's basic services, such as police, fire, public works, community
services, community development, and general administration, are included here. Taxes, revenues from other
governments and agencies, income from property and investments, grants and contributions, and charges for
services finance most of these activities.
• Business-type activities - The City charges fees to customers to cover the costs of certain services it provides.
The City's water, sewer, and trash services are the primary business-type activities.
Fund Financial Statements
The Fund Financial Statements provide more detailed information about the City's most significant funds - not the
City as a whole. Funds are accounting devices that the City uses to keep track of specific sources of funding and
spending for particular purposes.
Some funds are required by State law and bond covenants, while the City establishes other funds to control and
manage money for particular purposes (such as the developer impact fee funds) or to show that it is properly using
certain taxes and grants (such as the Section 8 Housing Assistance fund).
The City has three kinds of funds:
• Governmental funds — Most of the City's basic services are included in governmental funds. These funds are
used to account for (1) cash and other financial assets that can readily be converted to cash flow in and out,
and (2) balances left at year-end that are available for spending. Consequently, the Governmental Funds
Statements provide a detailed short-term view that helps the reader determine the amount of financial resources
that can be spent in the near future to finance the City's programs. A reconciliation between the long-term and
short-term focus of the Government-wide Financial Statements is provided immediately following each
statement.
• Proprietary funds - Services for which the City charges customers a fee are generally reported in proprietary
funds. Proprietary funds, like the Government-wide Financial Statements, provide both long- and short-term
financial information.
- There are two types of proprietary funds: enterprise funds and internal service funds.
- We use enterprise funds to report activities that provide business-type services, generally to external
customers - such as water, sewer and trash services. In both the Government-wide Financial Statements
and the Fund Financial Statements, these funds are shown under business-type activities.
We use internal service funds to report activities that provide services and supplies for the City's other
programs and activities - such as fleet, health insurance, and information technology.
18
• Fiduciary funds - These funds are used to account for situations where the City's role is purely custodial, such
as the receipt, temporary investment, and remittance of fiduciary resources to individuals, private
organizations, or other governments. All of the City's fiduciary activities are reported in a separate Statement
of Fiduciary Net Assets. We exclude these activities from the City's Government-wide Financial Statements
because the City cannot use these assets to finance its operations.
Financial Analysis of the City as a Whole
Net Assets
The City's combined net assets for the fiscal year ended June 30, 2003, as shown below, were $851 million. The
capital asset figure for governmental activities does not include all of the City's infrastructure assets, since the City
has not completed its inventory of infrastructure assets. GASB 34 allows the City an additional four years in which
to have an accounting of its infrastructure complete.
The City's net assets increased by $112 million during the current fiscal year. Approximately 42% of this increase
represents the degree to which increases in ongoing revenues have exceeded increases in ongoing expenses.
Approximately 58% represents one-time capital grants and contributions received by the City for the purchase and
acquisition of infrastructure and other capital assets.
CITY OF CARLSBAD'S NET ASSETS
(in millions of dollars)
Governmental
Activities
Current and other assets
Capital assets
Total assets
Long-term debt outstanding
Other liabilities
Total liabilities
Net assets
Invested in capital assets,
net of related debt
Restricted
Unrestricted
Total net assets
2002
$296.5
217.3
513.8
19.2
11.7
30.9
198.8
154.0
130.1
$482.9
2003
$330.9
265.0
595.9
17.5
12.9
30.4
248.2
200.3
117.0
$565.5
Business-Type
Activities
2002
$121.6
154.1
275.7
12.6
6.8
19.4
140.4
94.8
21.0
$256.2
2003
$128.0
175.1
303.1
10.8
7.1
17.9
163.2
96.7
25.2
$285.1
Total
2002
$418.1
371.4
789.5
31.8
18.5
50.3
339.2
248.8
151.1
$739.1
2003
$458.9
440.1
899.0
28.3
20.0
48.3
411.4
297.0
142.2
$850.6
Total
Percentage
Change
2002-03
9.8%
18.5%
13.9%
-11.0%
8.1%
-4.0%
21.3%
19.4%
-5.9%
15.1%
As noted earlier, net assets may serve over time as a useful indicator of the City's financial position. For the City of
Carlsbad, assets currently exceed liabilities by $850.6 million at the close of the most recent fiscal year.
A large portion of the City's net assets (48%) reflects its investment in capital assets (i.e., land, buildings,
machinery, equipment, and infrastructure), less any related debt used to acquire those assets that is still outstanding.
The City uses these capital assets to provide services to citizens; consequently, these assets are not available for
future spending. Although the City's investment hi its capital assets is reported net of related debt, it should be
noted that the resources needed to repay this debt must be provided from other sources since the capital assets
themselves usually won't be used to liquidate these liabilities. The net assets of the business-type activities for
fiscal year 2001-02 were reclassified to more appropriately reflect that portion that is truly restricted.
An additional portion of the City's net assets (35%) represents resources that are subject to external restrictions on
how they may be used. The remaining balance of unrestricted net assets ($142.2 million) may be used to meet the
government's ongoing obligations to citizens and creditors.
Over 58% of the $117 million in unrestricted governmental activities net assets is attributable to the General fund.
Although the unrestricted net assets of our business-type activities total $25.2 million, these resources cannot be
19
used to help fund governmental activities. The City can only use these net assets to finance the continuing
operations of the City's enterprises: water, sewer, trash, and golf operations.
Changes in Net Assets
The condensed summary of activities, which follows, shows that net assets increased by $111.5 million during the
year. This increase can be attributed to several factors including: actual revenues exceeding expenses for the year;
$12.9 million "savings" in the General fund being carried forward into the new fiscal year by the various major
service areas within the City to enhance and provide for future services and programs; the build-up of cash reserves
in the City's capital project funds for future capital project construction and acquisition; and the donation of
infrastructure assets from developers.
CITY OF CARLSBAD'S CHANGES IN NET ASSETS
(in millions of dollars)
Governmental Business-type
Activities
Revenues
Program revenues
Charges for services
Operating grants and contributions
Capital grants and contributions
General revenues
Property taxes
Sales and use taxes
Other taxes
Income from property and investments
Other
Total revenues
Expenses
General government
Public safety
Community development
Community services
Public works
Interest on long-term debt
Carlsbad Municipal Water District
Sewer
Other business-type activities
Total expenses
Excess (deficiency) before transfers
Transfers
Increase (decrease) in net assets
Beginning net assets
Ending net assets
2002
$14.6
8.0
26.9
28.5
21.0
19.7
18.1
5.4
142.2
7.6
25.7
10.5
13.3
15.0
1.7
-
-
-
73.8
68.4
-
68.4
414.5
$482.9
2003
$17.0
10.1
45.2
31.4
25.8
15.6
13.3
5.5
163.9
8.5
27.7
12.0
14.6
16.8
1.1
-
-
-
80.7
83.2
(0.6)
82.6
482.9
$565.5
Activities
2002
$25.5
0.6
16.1
1.5
-
-
7.0
0.8
51.5
-
-
-
-
-
-
19.3
6.2
0.3
25.8
25.7
-
25.7
230.5
$256.2
2003
$25.5
1.3
19.5
1.7
-
-
5.8
0.2
54.0
-
-
-
-
-
-
19.3
6.1
0.3
25.7
28.3
0.6
28.9
256.2
$285.1
Total
2002
$40.1
8.6
43.0
30.0
21.0
19.7
25.1
6.2
193.7
7.6
25.7
10.5
13.3
15.0
1.7
19.3
6.2
0.3
99.6
94.1
-
94.1
645.0
$739.1
2003
$42.5
11.4
64.7
33.1
25.8
15.6
19.1
5.7
217.9
8.5
27.7
12.0
14.6
16.8
1.1
19.3
6.1
0.3
106.4
111.5
-
111.5
739.1
$850.6
Total
Percentage
Change
2002-2003
6.0%
32.6%
50.5%
10.3%
22.9%
-20.8%
-23.9%
-8.1%
12.5%
11.8%
7.8%
14.3%
9.8%
12.0%
-35.3%
0.0%
-1.6%
0.0%
6.8%
18.5%
0.0%
18.5%
14.6%
15.1%
20
Virtually 45% of the City's
governmental funds revenue is
generated through taxes collected
(property, sales, transient occupancy
tax, etc.), and almost 47% of the City's
business-type revenue is generated
through charges for services. The
following chart graphically depicts the
City's revenue sources.
The total cost of all programs and
services was just over $106 million in
fiscal year 2002-03. The City's
expenses cover a range of services:
• General Government (8%)
City of Carlsbad
Sources of Revenue for Fiscal Year 2002-03
$217.9 Million
Other (less than 1 %)
Grants/ Property Taxes (15%)
Contributions (27%)
Income from Property and
Investments (9%)
Other Taxes (6%)
TOT (4%)
Charges for Services (19%)
Federal Aid (6%)
State Aid (2%)
This segment of the City is divided into two major groups, the Policy and Leadership group and the
Administrative Services group. The Policy and Leadership group encompasses all elected officials and the
chief executive offices for the City
Public Safety (26%)
Public Safety has always been a top City Council priority. The major service area includes the Police
Department, whose goal is to provide quality service to the community to ensure the preservation of life and
property and the maintenance of law and order. The Fire Department is also part of this major service area
with a mission to enhance the quality of life by delivering exceptional services in safeguarding lives, property,
and our environment.
Community Development (11%)
The mission of Community Development is to guide and
facilitate the development of the City of Carlsbad. This
is accomplished through the development of high-quality
projects and public facilities, preservation of the local
environment, diverse housing, employment and
enrichment opportunities, and a strong and stable
economic base. Community Development encompasses
the Hiring Center, Geographic Information Systems
(GIS), Economic Development, Community Promotion,
Land Use Planning, Housing and Redevelopment, and
Building Inspection.
Community Services (14%)
Community Services consist of the Library, Cultural
Arts, Recreation, Park Planning, and Senior Citizen
programs. These programs are provided to a wide range
of people and assist in their education and cultural
development.
City of Carlsbad
Functional Expenses for Fiscal Year 2002-03
$106.4 Million
Sewer
6%
General
Government
8%
Water
18%
Public Safety
26%
Public Works
16%
Community
Services
14%
Community
Development
11%
21
• Public Works (16%)
Public Works is charged with building and caring for all of the assets of the City. It includes Engineering;
Parks, Streets, Median, Street Tree, Buena Vista Channel, and Facilities Maintenance; Building Maintenance;
Street Lighting; and Traffic Sign and Signal Maintenance programs.
• Water Operations (18%)
The Carlsbad Municipal Water District, a subsidiary of the City of Carlsbad, provides potable water service to
approximately 85% of the City (75,000 customers). The District purchases 100% of its potable water as
treated water from the Metropolitan Water District and the San Diego County Water Authority. The District
also provides recycled water for irrigational purposes.
• Sewer Operations (6%)
The City of Carlsbad operates and maintains a sanitary sewer collection system, which covers approximately
65% of the geographic area of the City. Sewage is treated by the Encina Wastewater Treatment Plant, a
facility jointly owned by the Cities of Carlsbad and Vista, the Leucadia County Water District, the Vallecitos
Water District, the Buena Vista Sanitation District, and the Encinitas Sanitary District.
• Other Expenses (1%)
Other expenses include costs associated with the City's Solid Waste division, development of a municipal golf
course, and interest on the City's long-term debt that is associated with governmental activities.
The following sections will discuss the operations of governmental and business-type activities separately.
Governmental Activities
The increase in net assets for governmental activities was $82.6 million. This increase was generated by total
revenues of governmental activities of $163.9 million ($72.3 million in program revenues and $91.6 million in
general revenues) offset by $80.7 million in total costs of governmental activities.
The following table presents the total cost of each of the City's major programs, as well as each function's program
revenues (fees generated by the activities, contributions, and intergovernmental aid). The net cost (the difference
between adjoining bars in the graph) shows the financial burden that was placed on the City's taxpayers by each of
these functions (costs covered by general revenues).
$35
Governmental Activities
Program Revenues and Expenses
(in millions)
D Program Revenues
S Expenses
General Public Safety Community Community Public Works
Government Development Services
22
Revenues are generated through several sources to cover the cost of the City's programs. These revenues include
fees and charges paid by those who directly benefit from the programs ($17 million), grants and contributions from
other governments and organizations to subsidize certain programs ($55.3 million), and taxes and other revenues
(such as income from property and investments and Vehicle License Fees) received by the City to pay for the
"public benefit" portion, totaling $91.6 million.
Program revenues exceed expenses in Public Works as a large majority of Public Works revenues are used to
acquire and build capital assets (versus covering operating expenses), and the City does not acquire or build a capital
asset until the related revenues have been received. The City is currently in a developing or growing stage, and
master plans are being designed to construct and develop these new facilities, roads, parks, etc.
Business-Type Activities
Program revenues for the City's business-type activities totaled $46.3 million for the year, while functional expenses
equaled $25.7 million.
Business-Type Activities
Program Revenues and Expenses
(in millions)
Q Program Revenues
@ Expenses
Water Golf Course Sewer Solid Waste
As with the Public Works function in the governmental activities, program revenues are higher than program
expenses, since the City received contributions for current and future capital asset acquisitions and construction that
will be reflected as program expenses over time as depreciation expense. In addition, a small portion of the annual
surplus is set aside for rate stabilization and unanticipated events.
Financial Analysis of the City's Funds
As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance-related legal
requirements.
Governmental Funds
The focus of the City's governmental funds is to provide information on near-term inflows, outflows, and balances
of spendable resources. Such information is useful in assessing the City's financing requirements. In particular,
unreserved fund balance may serve as a useful measure of a government's net resources available for spending at the
end of the fiscal year.
23
Reserved for Other Purposes
($34.4 million)
Designated for Future Continuing
Appropriations
($65.3 million)
Governmental Fund Balances
(in millions)
$297.2 Million
Reserved to Liquidate Contracts and
Purchase Orders
($22.7 million)
Undesignated ($70.2 million)
Designated for Approved
Capital Projects
($104.6 million)
As of the end of the current fiscal year, the City's governmental funds reported combined ending fund balances of
$297.2 million, an increase of $32.2 million in comparison with the prior year. Approximately 23% of this amount
($70.2 million) constitutes undesignated fund balance, which is available for spending at the government's
discretion based on the purpose for which it was received. The remainder of the fund balance is reserved or
designated to indicate that it is not available for new spending because it has already been committed (1) for future
capital projects (35%), (2) to liquidate contracts and purchase orders of the prior period (8%), (3) for future
programs (22%) or (4) for a variety of other restricted purposes (12%).
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
(in millions of dollars)
Total
Increase Percentage
Total (Decrease)
Revenues
Taxes
Intergovernmental
Licenses and permits
Charges for services
Income from property and investments
Interdepartmental charges
Miscellaneous
Total revenues
Expenses
General government
Public safety
Community development
Community services
Public works
Principal and interest
Total expenses
Excess (deficiency) before transfers
Transfers
Increase (decrease) in fund balance
Beginning fund balance
Ending fund balance
2002
$63.6
6.2
2.0
6.0
5.5
2.2
1.8
87.3
7.3
25.2
5.7
11.9
12.6
0.2
62.9
24.4
(6.8)
17.6
70.6
$88.2
2003
S66.1
6.6
2.0
7.7
4.3
2.7
1.5
90.9
8.1
26.5
6.0
12.9
14.9
0.7
69.1
21.8
(38.8)
(17.0)
88.2
$71.2
Change
2002-2003
$2.5
0.4
0.0
1.7
(1.2)
0.5
(0.3)
3.6
0.8
1.3
0.3
1.0
2.3
0.5
6.2
3.9%
6.5%
0.0%
28.3%
-21.8%
22.7%
-16.7%
4.1%
11.0%
5.2%
5.3%
8.4%
18.3%
250.0%
9.9%
The General fund is the chief
operating fund of the City, and at
the end of the fiscal year had a
total fund balance of $71.2
million, a decrease of $17
million. This decrease was the
result of transferring $35 million
to the General Capital
Construction fund to assist in the
construction of the following
capital projects approved with
the passage of Proposition C:
• A new swimming pool
complex.
• Trails linkages and the
acquisition of open space in
the City.
• A new City/safety training
facility.
• The construction of a major
road.
The unreserved fund balance
portion of the General fund was
$58.3 million, of which $12.9 million was designated for future programs and service enhancements.
The increase in revenues was primarily due to three factors: the continuation of a strong housing market on property
taxes, strong automobile sales combined with a modification of the methodology used in the year-end sales tax
24
accrual (increased sales taxes) and the first increase in three years in development within the City (higher charges
for services). On the other hand, the effects of the stabilization of natural gas prices (lower franchise taxes) and a
20% drop in the yield of the City's cash portfolio for the year partially offset the increase in General fund revenues.
The increase in General fund expenditures were driven by the following factors:
• Normal salary and benefit increases.
• The addition of a communications department within General Government.
• The moving of state library grants and the senior nutrition program into the Community Services section of the
General fund.
• Additional outside consulting for engineering plan check services in Public Works.
• New playground equipment at several park sites shown in Community Services.
• The payoff of a regional communication equipment lease.
Of all the major governmental funds, the only one with a negative fund balance is the Redevelopment debt service
fund. It reflects a negative fund balance of just over $11 million. This deficit was created when the City's General
fund loaned the agency money to cover debt service charges during the period soon after the agency's bonds were
issued, but prior to the agency being able to support the debt service with property tax increment revenues alone.
The agency has begun to repay the $13.1 million advance back to the City's General fund, as the tax increment
collected within the redevelopment area grows.
The majority of the other major governmental funds, which are all capital project funds, showed increases in their
fund balances during the year. However, these increases in fund balances are all designated for the construction or
purchase of future capital projects. The Bridge and Thoroughfare Districts funds are the only major governmental
funds reflecting a reduction in fund balance, due to the use of funds to construct Poinsettia Lane.
Proprietary Funds
The City's proprietary funds provide the same type of information found in the Government-wide Financial
Statements, but in more detail.
The Water funds had an operating income of $496,000 for the year. Due to increased precipitation during the spring
and summer of 2003, water sales were $746,000 lower than last year. The largest expenditure for the year was for
purchased water, which was also lower than last year by $586,000 from decreased water usage.
Sewer funds had an annual operating income of $770,000 for the fiscal year. Total revenues increased from the
previous year due to a more accurate accrual at year-end combined with an increase in the customer base. Sewer
plant operation expenses are based on estimated or budgeted costs for the current year at the facility, adjusted by any
budget to actual variances calculated from the previous fiscal year. In fiscal year 2001-02, actual charges came in
lower than the budgeted expenses that were charged to the City, and this difference was credited to the City in the
current fiscal year.
Unrestricted net assets for the Water, Golf, Sewer, and Solid Waste operations at the end of the year amounted to
$25.3 million, almost 9% of the net assets of all proprietary funds. These assets will be used for future rate
stabilization efforts as well as for any emergency situation. Approximately 34% of the net assets are restricted for
future capital construction, and reside in the Water and Sewer funds.
General Fund Budgetary Highlights
Management monitors revenues during the year and will update estimated revenue figures when new information is
received by the City. Net estimated revenues were increased during this year by $2.3 million to reflect the following
changes:
• Significantly lower franchise fees due to lower gas prices paid by consumers in fiscal year 2002 as compared
to the price spike in fiscal year 2001.
25
• The combined effects of the continuing impact of the terrorist attacks on the tourism industry, and a
remodeling project occurring at one of the City's largest hotels, on Transient Occupancy Taxes.
• Higher than anticipated development affecting charges for services and licenses and permits.
• Increased interest income based on a higher average daily cash balance as compared to last fiscal year.
• Increase in the monthly administrative overhead revenue generated through charges to funds outside of the
General fund.
The increase from the total original budgeted expenditures to the final budget amounted to $780,000, due
predominantly from appropriating funds received from developers during the year for developer-funded studies.
The difference between the final budgeted expenditures and the actual expenditures for the year on a budgetary basis
of $ 15.6 million can be generally summarized as follows:
• $12.9 million "savings" being carried forward into the new fiscal year by the various major service areas
within the City to enhance and provide for future services and programs.
• $1.9 million representing unspent City Council Contingency money that was budgeted for unanticipated
emergencies or unforeseen program needs.
Budgeted transfers out were increased during the year by $35 million to transfer funds from the General fund to the
General Capital Construction fund to assist in the construction of capital projects approved with the passage of
Proposition C. Proposition C was approved by the citizens of Carlsbad in November 2002, allowing the City to
spend more than $1 million out of the General fund for several capital projects.
For purposes of budgetary presentation, actual revenues have been adjusted to exclude unrealized gains and losses
pursuant to GASB 31, actual expenditures have been adjusted to include encumbrances outstanding, and transfers
out have been adjusted to reflect any transfer that was approved through the budget process as an expenditure but
recorded as an advance in the financial statements.
Capital Asset and Debt Administration
Capital Assets
At the end of 2003, the City had recorded an investment of over $510 million in a broad range of capital assets,
including park facilities, land, buildings, roads, bridges, water and sewer lines, police and fire vehicles, and other
maintenance equipment. This number does not include infrastructure assets constructed prior to July 1, 2001, as the
City has not completed its inventory of infrastructure assets. Under GASB 34, the City has until fiscal year 2005-06
in which to complete a full accounting of its infrastructure. New infrastructure purchased or constructed during the
last two fiscal years in the City's governmental funds has been added into the total capital asset figures.
CITY OF CARLSBAD'S CAPITAL ASSETS
(in millions of dollars)
Governmental Business-Type
Activities
Land
Buildings and other structures
Improvements other than buildings
Machinery and equipment
Infrastructure
Construction in progress
Sewage treatment facility
Accumulated depreciation
Total
2002
$47.1
66.6
10.3
20.6
24.4
70.0
.
239.ff
(21.7)
$217.3
2003
$54.3
66.7
10.4
21.5
57.4
80.2
-
290.5
(25.5)
$265.0
Activities
2002
$8.7
2.2
5.1
1.6
115.8
27.5
35.4
196.3
(42.2)
$154.1
2003
$8.7
2.2
5.5
1.6
128.6
37.8
35.9
220.3
(45.2)
$175.1
Total
2002
$55.8
68.8
15.4
22.2
140.2
97.5
35.4
435.3
(63.9)
$371.4
2003
$63.0
68.9
15.9
23.1
186.0
118.0
35.9
510.8
(70.7)
$440.1
Change
2002-03
$7.2
0.1
0.5
0.9
45.8
20.5
0.5
75.5
(6.8)
$68.7
Total
Percentage
Change
2002-03
12.9%
0.1%
3.2%
4.1%
32.7%
21.0%
1.4%
17.3%
10.6%
18.5%
This year's major capital asset additions included:
• The purchase and developer contribution of land for the Alga Norte Park site.
26
• Developer-dedicated streets, drainage facilities, water lines, sewer lines, streetlights, and drainage facilities.
• City-constructed streets, drainage facilities, water lines and traffic signals.
• Street work undertaken as part of the pavement management/overlay program.
In addition to carrying forward appropriations of $105.6 million for previously budgeted projects, the City's fiscal
year 2003-04 capital budget appropriates an additional $59.6 million for capital projects. These additional
appropriations are principally for park development, the pavement management program, street projects, enhancing
the sewer collection system, additional water lines and debt payments, traffic signals, and loan repayments. These
projects will be financed by development fees, infrastructure and replacement transfers from the General fund,
special district fees and taxes, water and sewer replacement reserves, and other sources including grants and
contributions from other agencies. More detailed information about the City's capital assets is presented in Note 6
to the financial statements as well as the City's Capital Improvement Program document available from the Finance
Department.
Long-Term Debt
At year-end, the City had $28.3 million in bonds, certificates of deposit, loans, leases, and accrued assessments
payable, a decrease of $3.5 million from last year, as shown in the table below. More detail about the City's long-
term liabilities is presented in Note 8 to the financial statements.
CITY OF CARLSBAD'S OUTSTANDING DEBT
(in millions of dollars)
Governmental Business-Type
Activities
Bonds
Certificates of participation
Loans
Obligations under capital leases
Installment purchase agreement
Accrued assessments
Less: Deferred charges
Total
2002
$13.6
4.5
0.3
0.8
-
-
-
$19.2
2003
$13.2
3.9
0.2
0.2
-
-
-
$17.5
Activities
2002
$0.0
2.3
1.6
-
8.9
0.6
(0.8)
$12.6
2003
$0.0
1.2
1.5
-
8.4
0.4
(0.7)
$10.8
Total
2002
$13.6
6.8
1.9
0.8
8.9
0.6
(0.8)
$31.8
2003
$13.2
5.1
1.7
0.2
8.4
0.4
(0.7)
$28.3
Total
Percentage
Change
2002-03
-2.9%
-25.0%
-10.5%
-75.0%
-5.6%
-33.3%
-11.0%
Economic Factors and Next Year's Budgets and Rates
• Total assessed values in the City stand at over $ 14 billion, almost double what they were just five years ago.
• The May 2003 revision of the Governor's 2003-04 budget reports a projected $38.2 billion deficit through the
2003-04 fiscal year, or 50% of the State of California's General fund.
• Per PKF Consulting, occupancy rates for north coastal San Diego County hotels are up 1.7%, and average
room rates are up 3.3% for the period from January 2003 through May 2003 as compared to the same period
last year.
• PERS rates for our miscellaneous plan have increased for the 2003-04 fiscal year from 0% to 2.258%, and
have increased from 3.504% to 9.367% for our safety plan.
• Retail natural gas prices have stabilized during the past twelve months, impacting our future franchise fee
revenue.
• The Consumer Price Index (CPI) for the western region of the United States for urban households increased by
1.9% during the twelve months ended November 30, 2002, impacting our budgeted expenditures for fiscal year
2003-04.
• The total number of housing units in Carlsbad grew by 1.6% in calendar year 2002, impacting our budgeted
expenditures for fiscal year 2003-04.
All of these factors were considered in preparing the City of Carlsbad's General fund budget for the 2003-04 fiscal
year. Budgeted expenditures are expected to increase 2.4% to $84.8 million. The increase is mainly due to the 2%
increase given to departments in their block budget. In addition, just over $12.9 million in unspent 2002-03
27
budgeted expenditures will be carried over to the 2003-04 fiscal year, as well as $3.1 million in open encumbrances
as of June 30, 2003.
During the current fiscal year, unreserved fund balance in the General fund decreased to $45.5 million. This
decrease was the result of transferring $35 million to the General Capital Construction fund to assist in the
construction of capital projects approved with the passage of Proposition C. If the City's budget estimates are
realized, the City's budgeted unreserved General fund is expected to increase modestly by the close of fiscal year
2004.
The City's business-type activities reflect the following:
• No anticipated rate structure changes during the next fiscal year.
• No projected significant changes in other revenue sources.
• Other changes in the Enterprise funds are the result of normal fluctuations in operations.
Contacting the City's Financial Management
This financial report is designed to provide our citizens, taxpayers, customers, and investors and creditors with a
general overview of the City's finances and to demonstrate the City's accountability for the money it receives. If
you have any questions about this report or need additional information, contact the Finance Department,
1635 Faraday Avenue, Carlsbad, CA 92008, (760) 602-2430, or visit us online at www.ci.carlsbad.ca.us.
28
29
CITY OF CARLSBAD, CALIFORNIA
Statement of Net Assets
June 30, 2003
Primary Government
ASSETS
Cash and investments
Receivables:
Taxes
Accounts, net
Other
Due from other governments
Inventories
Prepaid items
Loans receivable
Deposits
Restricted assets:
Cash and investments
Accrued interest
Internal balances
Capital assets:
Land
Buildings and other structures
Improvements other than buildings
Machinery and equipment
Infrastructure
Construction in progress
Sewage treatment facility
Less accumulated depreciation
Total capital assets
Total assets
Governmental
Activities
$ 303,749,655
6,562,459
450,677
282,558
3,084,307
117,304
530,133
9,464,443
3,196,408
669,684
15,600
2,737,200
54,385,184
66,638,374
10,384,245
21,463,208
57,431,872
80,252,719
-
(25,508,118)
265,047,484
$ 595,907,912
Business-type
Activities
$ 124,330,827 $
58,695
2,967,019
-
1,131,787
525,304
7,212
-
-
1,694,695
28,557
(2,737,200)
8,663,600
2,258,064
5,556,571
1,565,983
128,559,111
37,792,947
35,903,734
(45,241,825)
175,058,185
$ 303,065,081 $
Total
428,080,482
6,621,154
3,417,696
282,558
4,216,094
642,608
537,345
9,464,443
3,196,408
2,364,379
44,157
-
63,048,784
68,896,438
15,940,816
23,029,191
185,990,983
118,045,666
35,903,734
(70,749,943)
440,105,669
898,972,993
The notes to the financial statements are an integral part of this statement.
30
CITY OF CARLSBAD, CALIFORNIA
Statement of Net Assets (Continued)
June 30,2003
Primary Government
LIABILITIES
Accrued liabilities
Accrued interest payable
Due to other governments
Estimated claims payable
Deposits payable
Current liabilities payable from
restricted assets - accrued interest
Deferred revenue
Noncurrent liabilities:
Due within one year
Due in more than one year, net of deferred
charges and unamortized issuance costs
of $644,083
Total liabilities
NET ASSETS
Invested in capital assets, net of related debt
Restricted for:
Capital assets
Other purposes
Unrestricted
Total net assets
Governmental
Activities
$ 8,456,760
311,429
109,659
3,015,843
402,528
-
632,564
1,220,144
16,278,507
30,427,434
248,218,517
165.477,914
34,854,737
116.929,310
$ 565,480,478
Business-type
Activities
$ 3,085,307
-
2,300,045
-
384,690
219,995
1,147,349
1,976,975
8,832,405
17,946,766
163,206,299
96,666,368
-
25,245,648
$ 285,118,315
Total
$ 11,542,067
311,429
2,409,704
3,015,843
787,218
219,995
1,779,913
3,197,119
25,110,912
48,374,200
411,424,816
262,144,282
34,854,737
142,174,958
$ 850,598,793
The notes to the financial statements are an integral part of this statement.
31
CITY OF CARLSBAD
Statement of Activities
For the Year Ended June 30,2003
Program Revenues
Functions/Programs
Primary government:
Governmental activities:
General government
Public safety
Community development
Community services
Public works
Interest on long-term debt
Total governmental activities
Business-type activities:
Carlsbad Municipal Water District
Golf course
Sewer
Solid waste
Total business-type activities
Total primary government
Expenses
$ 8,517,581
27,747,646
12,004,364
14,537,925
16,825,872
1,048,264
80,681,652
19,261,199
93,341
6,103,668
218,014
25,676,222
$ 106,357,874
Charges for
Services
$ 749,616
3,269,323
4,261,402
2,085,740
6,668,081
-
17,034,162
18,275,590
-
6,286,216
868,033
25,429,839
$ 42,464,001
Operating
Grants and
Contributions
$ 687,856
229,349
6,444,795
921,788
1,855,182
-
10,138,970
1,209,335
-
-
57,861
1,267,196
$ 11,406,166
Capital
Grants and
Contributions
$ 80,865
29,577
1,182,337
2,044,903
41,842,602
-
45,180,284
12,399,506
-
7,139,549
-
19,539,055
$ 64,719,339
General revenues:
Property taxes
Sales and use taxes
Transient occupancy taxes
Franchise taxes
Business license taxes
Real property transfer taxes
Vehicle license fees
Homeowners exemptions
Income from property and investments
Gain on sale of capital assets
Other general revenues
Transfers
Total general revenues and transfers
Change in net assets
Net assets at beginning of year
Net assets at end of year
The notes to the financial statements are an integral part of this statement.
32
Net Revenue (Expense) and
Changes in Net Assets
Primary Government
Governmental
Activities
$ (6,999,244)
(24,219,397)
(115,830)
(9,485,494)
33,539,993
(1,048,264)
(8,328,236)
-
-
-
-
$ (8,328,236)
$ 31,410,575
25,767,426
8,387,388
3,729,712
2,305,178
1,126,804
5,066,902
343,805
13,347,285
(9,676)
55,867
(600,000)
90,931,266
82,603,030
482,877,448
$ 565,480,478
Business-type
Activities
$
-
-
-
-
-
-
12,623,232
(93,341)
7,322,097
707,880
20,559,868
$ 20,559,868
$ 1,671,552
-
-
-
-
-
-
24,264
5,835,693
49,148
135,280
600,000
8,315,937
28,875,805
256,242,510
$285,118,315
Total
$ (6,999,244)
(24,219,397)
(115,830)
(9,485,494)
33,539,993
(1,048,264)
(8,328,236)
12,623,232
(93,341)
7,322,097
707,880
20,559,868
$ 12,231,632
$ 33,082,127
25,767,426
8,387,388
3,729,712
2,305,178
1,126,804
5,066,902
368,069
19,182,978
39,472
191,147
-
99,247,203
111,478,835
739,119,958
$ 850,598,793
33
CITY OF CARLSBAD
Balance Sheet
Governmental Funds
June 30,2003
ASSETS
Cash and investments
Receivables:
Taxes
Accounts, net
Other
Due from other funds
Due from other governments
Inventories
Prepaid items
Restricted cash and investments
Loans receivable
Deposits
Advances to other funds
Total assets
LIABILITIES AND FUND BALANCES
Liabilities:
Accrued liabilities
Due to other funds
Deposits payable
Due to other governments
Advances from other funds
Deferred revenue
Total liabilities
General
Fund
$ 61,078,565
6,519,627
145,459
278,381
570,524
37,271
20,748
54,605
-
179,744
-
17,434,568
$ 86,319,492
$ 4,958,341
-
155,894
-
-
10,068,374
15,182,609
Redevelopment
Debt
Service Funds
$ 2,046,726
26,298
-
177
-
-
-
-
-
-
-
-
$ 2,073,201
$
-
-
42,106
13,070,949
-
13,113,055
Bridge and
Thoroughfare
Districts
$ 5,546,540
-
-
-
-
-
-
-
-
-
3,196,408
-
$ 8,742,948
$ 222,487
-
-
-
5,483,344
-
5,705,831
Fund balances:
Reserved
Unreserved:
Designated, reported in:
General Fund
Special Revenue Funds
Capital Project Funds
Undesignated, reported in:
General Fund
Special Revenue Funds
Debt Service Funds
Capital Project Funds
Total fund balances
12,794,287
12,873,309
45,469,287
1,630,726
1,406,391
(11,039,854)
71,136,883 (11,039,854) 3,037,117
Total liabilities and fund balances
The notes to the financial statements are an integral part of this statement.
$ 86,319,492 $ 2,073,201 $ 8,742,948
34
Community General
Facilities Capital
District No. 1 Construction
$ 33,869,062 $ 48,494,326
490
-
-
-
-
-
-
-
-
-
5,260,854
$ 33,869,552 $ 53,755,180
Public Other
Facilities Governmental
Construction Funds
$ 34,582,534 $ 103,391,222
16,044
272,828
4,000
-
3,047,036
-
343,247
685,284
9,284,699
-
4,643,344
$ 34,582,534 $ 121,687,704
Total
Governmental
Funds
$ 289,008,975
6,562,459
418,287
282,558
570,524
3,084,307
20,748
397,852
685,284
9,464,443
3,196,408
27,338,766
$341,030,611
$ 65,233 $ 78,875
-
-
-
-
201,425
65,233 280,300
143,838 5,974,457
-.
-
33,660,481 4,699,519
35,000,000
-
-
7,800,904
33,804,319 53,474,880
$ 33,869,552 $ 53,755,180
$ 259,059 $ 2,120,442
570,524
246,634
67,553
6,047,273
181,474
259,059 9,233,900
2,171,968 34,344,151
.
4,156,248
32,151,507 45,980,831
-
16,854,136
591,125
10,527,313
34,323,475 112,453,804
$ 34,582,534 $ 121,687,704
$ 7,704,437
570,524
402,528
109,659
24,601,566
10,451,273
43,839,987
57,059,427
12,873,309
4,156,248
117,898,729
80,469,287
16,854,136
(10,448,729)
18,328,217
297,190,624
$341,030,611
35
CITY OF CARLSBAD
Reconciliation of the Balance Sheet of Governmental Funds
to the Statement of Net Assets
June 30,2003
Total fund balances - governmental funds.
Amounts reported for governmental activities in the statement of net assets are different because:
Capital assets used in governmental activities are not financial resources, and
therefore are not reported in the funds.
Governmental funds
Internal service funds
Total capital assets
Internal service funds are used by management to charge the costs of fleet
management, health insurance, information technologies, records management,
risk management and workers' compensation to individual funds. The assets
and liabilities of the internal service funds are included in governmental
activities in the statement of net assets.
Total internal service fund net assets
Internal service fund net assets included as part of total capital assets
Internal service fund net assets included as part of long-term liabilities
Internal service fund net assets less capital assets
Accrued interest is not due and payable in the current period, and therefore
is not reported in the funds.
Interest receivable on advances to other funds is not a current financial
resource, and therefore is not recognized as revenue in the funds until received.
A portion of the taxes receivable are not available to pay for current-period
expenditures and, therefore, are deferred in the funds.
Long-term liabilities, including bonds payable, are not due and payable
in the current period, and therefore are not reported in the funds.
Governmental funds
Internal service funds
Total long-term liabilities
Net assets of governmental activities.
The notes to the financial statements are an integral part of this statement.
$297,190,624
258,505,048
6,542,436
265,047,484
17,766,648
(6,542,436)
9,529
11,233,741
(311,429)
8,906,271
912,438
(17,489,122)
(9,529)
(17,498,651)
$565,480,478
36
37
CITY OF CARLSBAD
Statement of Revenues, Expenditures and Changes in Fund Balances
Governmental Funds
For the Year Ended June 30,2003
Revenues:
Taxes
Intergovernmental
Licenses and permits
Charges for services
Fines and forfeitures
Income from property and investments
Interdepartmental charges
Contributions from property owners
Donations
Miscellaneous
Total revenues
Expenditures:
Current:
General government
Public safety
Community development
Community services
Public works
Capital outlay
Debt service:
Principal retirement
Interest and fiscal charges
Total expenditures
Excess (deficiency) of revenues
over expenditures
Other financing sources (uses):
Transfers in
Transfers out
Proceeds of debt
Total other financing sources (uses)
Net change in fund balances
Fund balances (deficits) at beginning of year
Fund balances (deficits) at end of year
The notes to the financial statements are an integral part
General
Fund
$ 66,065,459
6,629,117
2,042,529
7,709,350
860,692
4,252,380
2,686,817
-
-
650,339
90,896,683
8,131,557
26,473,075
6,033,966
12,923,374
14,848,762
-
598,886
59,570
69,069,190
21,827,493
1,214,472
(40,059,818)
-
(38,845,346)
(17,017,853)
88,154,736
$ 71,136,883
of this statement.
Redevelopment
Debt
Service Funds
$ 1,725,466
-
-
-
-
86,482
-
-
-
-
1,811,948
20,275
-
-
-
-
-
340,000
1,319,026
1,679,301
132,647
-
(282,000)
-
(282,000)
(149,353)
(10,890,501)
$ (11,039,854)
Bridge and
Thoroughfare
Districts
$
240,831
-
-
-
253,703
-
36,600
-
288,632
819,766
-
-
-
-
-
1,456,593
-
-
1,456,593
(636,827)
-
-
-
_
(636,827)
3,673,944
$ 3,037,117
38
Community
Facilities District
No. 1
$ 4,270,767
-
-
-
-
1,527,372
-
701,561
-
1,000
6,500,700
106,169
-
-
-
-
457,226
-
-
563,395
5,937,305
(5,692,343)
(5,692,343)
244,962
33,559,357
$ 33,804,319
General
Capital
Construction
$
-
-
-
-
1,433,309
-
320,650
-
2,959
1,756,918
-
-
-
-
332,862
-
-
332,862
1,424,056
35,196,189
(29,252)
35,166,937
36,590,993
16,883,887
$ 53,474,880
Public
Facilities
Construction
$
-
-
-
-
1,795,150
-
3,780,131
-
6,452
5,581,733
-
-
-
'
3,758,660
-
-
3,758,660
1,823,073
584,905
-
584,905
2,407,978
31,915,497
$ 34,323,475
Other
Governmental
Funds
$ 2,094,552
12,905,376
-
2,349,321
62,376
5,453,153
128,590
9,708,024
148,844
1,399,453
34,249,689
547,312
324,789
5,764,866
450,382
3,327,935
20,405,142
732,610
249,899
31,802,935
2,446,754
10,850,176
(2,517,146)
8,333,030
10,779,784
101,674,020
$ 112,453,804
Total
Governmental
Funds
$ 74,156,244
19,775,324
2,042,529
10,058,671
923,068
14,801,549
2,815,407
14,546,966
148,844
2,348,835
141,617,437
8,805,313
26,797,864
11,798,832
13,373,756
18,176,697
26,410,483
1,671,496
1,628,495
108,662,936
32,954,501
47,845,742
(48,580,559)
(734,817)
32,219,684
264,970,940
$ 297,190,624
39
CITY OF CARLSBAD
Reconciliation of the Statement of Revenues, Expenditures and Changes
in Fund Balances of Governmental Funds to the Statement of Activities
For the Year Ended June 30, 2003
Net change in fund balances - total governmental funds.$ 32,219,684
Amounts reported for governmental activities in the statement of activities are different because:
Governmental funds report capital outlays as expenditures. However, in the
statement of activities, the cost of those assets is allocated over their estimated
useful lives and reported as depreciation expense.
Purchase of capital assets
Depreciation expense
Governmental funds do not reflect the donation of capital assets as revenues.
26,730,686
(2,903,695)
24,397,507
Governmental funds report the entire proceeds from the sale of capital assets as revenue.
However, in the statement of activities, the net gain or loss from the sale of capital
assets is reported.(20,494)
The repayment of the principal of long-term debt consumes the current financial
resouces of governmental funds but has no effect on net assets.1,671,496
Some expenses reported in the statement of activities do not require the use
of current financial resources, and therefore are not reported as expenditures
in governmental funds.36,240
Unpaid interest income on advances to other funds is not a current financial
resource, and therefore is not recognized as revenue in the funds.337,192
A portion of sales and use taxes is not available to pay for current-period
expenditures and, therefore, is deferred in the funds.
The net revenue of certain activities of internal service funds is reported
with governmental activities.
Change in net assets of governmental activities.
912,438
(778,024)
$ 82,603,030
The notes to the financial statements are an integral part of this statement.
40
41
CITY OF CARLSBAD
Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
General Fund
For the Year Ended June 30,2003
Variance With
Final Budget -
Budgeted Amounts
Revenues:
Taxes
Intergovernmental
Licenses and permits
Charges for services
Fines and forfeitures
Income from property and investments
Interdepartmental charges
Miscellaneous
Total revenues
Expenditures:
Current:
General government
Public safety
Community development
Community services
Public works
Debt service:
Principal retirement
Interest and fiscal charges
Total expenditures
Excess of revenues over expenditures
Other financing sources (uses):
Transfers in
Transfers out
Proceeds of debt
Total other financing sources (uses)
Net change in fund balances
Fund balance at beginning of year
Fund balance at end of year
Original
$ 64,943,000
6,426,000
1,545,000
5,338,000
854,000
3,735,000
2,500,000
700,000
86,041,000
14,015,623
29,441,489
8,469,163
16,440,592
17,997,982
598,886
59,570
87,023,305
(982,305)
-
(5,976,419)
-
(5,976,419)
(6,958,724)
88,154,736
$ 81,196,012
Final
S 64,016,000
6,659,000
1,715,000
7,234,000
900,000
4,350,000
2,800,000
700,000
88,374,000
13,664,563
29,608,279
8,921,563
16,748,587
18,202,371
598,886
59,570
87,803,819
570,181
1,214,472
(41,136,237)
-
(39,921,765)
(39,351,584)
88,154,736
$ 48,803,152
Actual Amounts
(Budgetary Basis)
$ 66,065,459 $
6,629,117
2,042,529
7,709,350
860,692
4,483,932
2,686,817
650,339
91,128,235
8,684,013
26,682,496
7,035,104
13,304,793
15,809,398
598,886
59,570
72,174,260
18,953,975
1,214,472
(41,136,237)
-
(39,921,765)
(20,967,790)
88,154,736
$ 67,186,946 $
Over
(Under)
2,049,459
(29,883)
327,529
475,350
(39,308)
133,932
(113,183)
(49,661)
2,754,235
(4,980,550)
(2,925,783)
(1,886,459)
(3,443,794)
(2,392,973)
-
-
(15,629,559)
18,383,794
-
-
-
_
18,383,794
.
18,383,794
The notes to the financial statements are an integral part of this statement.
42
CITY OF CARLSBAD
Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
General Fund (Continued)
For the Year Ended June 30,2003
BUDGET-TO-GAAP RECONCILIATION
Actual Amounts
(Budgetary Basis)
Revenues
Actual amounts (budgetary basis) "available for appropriation" from
the budgetary comparison schedule (previous page). $ 91,128,235
Differences - budget to GAAP:
The recording of unrealized gains and losses on the City's investments
are shown for financial reporting purposes (pursuant to GASB 31),
but are not shown for budgetary purposes. (231,552)
$ 90,896,683
Expenditures
Actual amounts (budgetary basis) "total charges to appropriations"
from the budgetary comparison schedule (previous page).
Differences - budget to GAAP:
Encumbrances are shown in the year encumbered for budgetary purposes,
but in the year paid for financial reporting purposes.
$ 72,174,260
(3,105,070)
$ 69,069,190
Other Financing Sources (Uses)
Actual amounts (budgetary basis) "transfers out"
from the budgetary comparison schedule (previous page).
Differences - budget to GAAP:
For budgetary purposes, the transfer to the Storm Water Program is
shown as a transfer out, but on a GAAP basis, the transfer is
shown as a loan.
$ (41,136,237)
1,076,419
The notes to the financial statements are an integral part of this statement.
$ (40,059,818)
43
CITY OF CARLSBAD
Statement of Net Assets
Proprietary Funds
June 30,2003
ASSETS
Business-type Activities -
Carlsbad
Municipal
Water District
Golf
Course Sewer
Current assets:
Cash and investments
Receivables:
Taxes
Accounts, net
Due from other governments
Inventories
Prepaid items
Total current assets
Noncurrent assets:
Restricted assets:
Cash and investments
Accrued interest
Total restricted assets
Capital assets:
Land
Buildings and other structures
Improvements other than buildings
Machinery and equipment
Infrastructure
Construction in progress
Sewage treatment facility
Less accumulated depreciation
Total capital assets (net of accumulated
depreciation)
Total noncurrent assets
Total assets
The notes to the financial statements are an integral part of this statement.
$ 52,938,871 $ 2,419,856 $ 64,076,138
25,336
1,957,496
1,131,787
518,018
7,212
56,578,720
740,483
6,832
747,315
1,909,565
2,258,064
2,185,604
992,094
88,827,203
16,894,231
-
(22,296,372)
90,770,389
91,517,704
$ 148,096,424 !
-
742,906
-
7,286
-
2,419,856 64,826,330
954,212
21,725
975,937
5,075,228 1,678,807
-
3,370,967
573,889
39,731,908
3,663,019 17,235,697
35,903,734
(22,945,453)
8,738,247 75,549,549
8,738,247 76,525,486
5 11,158,103 $ 141,351,816
44
Enterprise Funds
Solid
Waste Totals
$ 4,895,962 $ 124,330,827
33,359 58,695
266,617 2,967,019
1,131,787
525,304
7,212
5,195,938 129,020,844
1,694,695
28,557
Governmental
Activities -
Internal
Service
Funds
$ 14,740,680
-
32,390
-
96,556
132,281
15,001,907
-
1,723,252
8,663,600
2,258,064
5,556,571
1,565,983
128,559,111
37,792,947
35,903,734
(45,241,825)
175,058,185
176,781,437
$ 5,195,938 $ 305,802,281
-
-
14,840,719
-
-
-
(8,298,283)
6,542,436
6,542,436
$ 21,544,343
(Continued)
45
'•*«*,*'
CITY OF CARLSBAD
Statement of Net Assets
Proprietary Funds (Continued)
June 30, 2003
Noncurrent liabilities:
Advance from other funds
Deferred revenue
Loan payable
Capital leases payable
Installment purchase agreement, net of deferred
charges of $622,821
1,343,173
Business-type Activities -
LIABILITIES
Current liabilities:
Accrued liabilities
Due to other governments
Due to other funds
Estimated claims payable
Current portion of long-term debt, net of unamortized
issuance costs and deferred charges of $21,262
Deposits payable
Total current liabilities
Current liabilities payable from restricted assets:
Accrued interest
Carlsbad
Municipal
Water District
S 1,638,794
2,300,045
-
-
1,270,915
128,859
5,338,613
33,321
Golf
Course Sewer
$ - $ 1,201,699
-
-
-
186,060 520,000
255,831
186,060 ' 1,977,530
7,276 179,398
2,737,200
1,147,349
7,232,179
Accrued assessments
Total noncurrent liabilities
Total liabilities
NET ASSETS
Invested in capital assets, net of related debt
Restricted for:
Capital assets
Unrestricted
-
1,343,173
6,715,107
88,896,783
40,023,892
12,460,642
257,053
2,994,253
3,187,589
5,557,934
2,412,580
-
8,379,528
10,536,456
68,751,582
56,642,476
5,421,302
Total net assets $ 141,381,317 $ 7,970,514 $ 130,815,360
The notes to the financial statements are an integral part of this statement.
46
Enterprise Funds
Solid
Waste
$ 244,814
-
-
.
-
244,814
Total
Proprietary
Funds
$ 3,085,307
2,300,045
-
1,976,975
384,690
7,747,017
Governmental
Activities -
Internal
Service
Funds
$ 752,323
-
3,015,843
6,217
-
3,774,383
219,995
-
-
-
-
-
-
244,814
2,737,200
1,147,349
1,343,173
-
7,232,179
257,053
12,716,954
20,683,966
-
-
3,312
-
-
3,312
3,777,695
-
-
4,951,124
$ 4,951,124
163,206,299
96,666,368
25,245,648
$ 285,118,315
6,532,907
.
11,233,741
$ 17,766,648
47
CITY OF CARLSBAD
Statement of Revenues, Expenses and Changes in Net Assets
Proprietary Funds
For the Year Ended June 30, 2003
Business-type Activities -
Operating revenues:
Water sales
Sewer service charges
Other charges for services
Contributions from other government agencies
Miscellaneous
Total operating revenues
Operating expenses:
Sewer plant operations
Purchased water
Depreciation
Fuel and supplies
Claims expense
General and administrative
Total operating expenses
Operating income (loss)
Nonoperating revenues (expenses):
Income from property and investments
Interest expense and fees
Gain (loss) on sale of property
Property taxes
Amortization of issuance costs
Total nonoperating revenues
Income before transfers and capital contributions
Transfers in
Transfers out
Capital contributions
Change in net assets
Total net assets at beginning of year
Total net assets at end of year
Carlsbad
Municipal
Water District
$ 17,626,567 $
-
649,023
1,209,335
41,768
19,526,693
-
10,791,362
1,548,279
-
-
6,691,205
19,030,846
495,847
2,562,335
(224,393)
6,322
1,695,816
(5,960)
4,034,120
4,529,967
-
-
12,399,506
16,929,473
124,451,844
$ 141,381,317 $
Golf
Course Sewer
$
6,192,845
93,371
-
85,661
6,371,877
1,924,973
-
1,519,403
-
-
93,341 2,157,913
93,341 5,602,289
(93,341) 769,588
125,230 2,927,563
(501,379)
42,826
-
-
125,230 2,469,010
31,889 3,238,598
600,000
-
7,139,549
631,889 10,378,147
7,338,625 120,437,213
7,970,514 $ 130,815,360
The notes to the financial statements are an integral part of this statement.
48
Enterprise Funds
Solid Waste
$
-
868,033
57,861
7,851
933,745
-
-
-
-
218,014
218,014
715,731
220,565
-
-
-
-
220,565
936,296
-
_
936,296
4,014,828
$ 4,951,124
Totals
$ 17,626,567
6,192,845
1,610,427
1,267,196
135,280
26,832,315
1,924,973
10,791,362
3,067,682
-
-
9,160,473
24,944,490
1,887,825
5,835,693
(725,772)
49,148
1,695,816
(5,960)
6,848,925
8,736,750
600,000
19,539,055
28,875,805
256,242,510
$ 285,118,315
Governmental
Activities -
Internal
Service Funds
$
-
12,021,653
-
152,240
12,173,893
-
1,683,324
471,773
5,665,924
6,049,176
13,870,197
(1,696,304)
657,739
-
3,404
-
-
661,143
(1,035,161)
134,817
122,320
(778,024)
18,544,672
$ 17,766,648
49
CITY OF CARLSBAD
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30,2003
Business-type Activities -
Cash flows from operating activities:
Receipts from customers and users
Payments to suppliers
Payments to employees
Internal activity - payments to other funds
Claims paid
Other receipts (payments)
(Decrease) in deposits payable
Net cash provided by (used in) operating activities
Cash flows from noncapital financing activities:
Operating subsidies and transfers to other funds
Cash flows from capital and related financing activities:
Capital contributions
Purchases of capital assets
Principal paid on capital debt
Interest and other fees paid
Property taxes received
Net cash provided by (used in) capital and
related financing activities
Cash flows from investing activities:
Interest on investments
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Carlsbad
Municipal
Water District
$ 18,931,990 $
(13,391,084)
(2,107,045)
(1,886,455)
-
1,267,276
19,785
2,834,467
-
4,548,361
(9,813,345)
(1,233,874)
(188,382)
1,691,624
(4,995,616)
2,552,382
391,233
52,548,121
$ 52,939,354 $
Golf
Course
$
(4,766)
-
-
-
(93,341)
-
(98,107)
600,000
-
(44,842)
(177,912)
-
-
(222,754)
125,230
404,369
2,015,487
2,419,856 $
Sewer
6,223,605
(2,660,398)
(405,391)
(960,017)
-
94,470
-
2,292,269
-
4,371,070
(2,966,456)
(495,000)
(427,334)
-
482,280
2,927,563
5,702,112
58,388,657
64,090,769
The notes to the financial statements are an integral part of this statement.
50
Enterprise Funds
Solid Waste
$ 33,170
(111,816)
(73,865)
(17,627)
-
892,449
-
722,311
-
-
-
-
220,565
942,876
3,953,086
Totals
$ 25,188,765
(16,168,064)
(2,586,301)
(2,864,099)
-
2,160,854
19,785
5,750,940
600,000
8,919,431
(12,824,643)
(1,906,786)
(615,716)
1,691,624
(4,736,090)
5,825,740
7,440,590
116,905,351
Governmental
Activities -
Internal
Service Funds
$ 12,022,267
(2,738,932)
(2,691,112)
(1,042,234)
(5,178,497)
142,322
-
513,814
33,335
(813,263)
(5,711)
-
-
(818,974)
657,739
385,914
14,354,766
$ 4,895,962 $ 124,345,941 $ 14,740,680
(Continued)
51
CITY OF CARLSBAD
Statement of Cash Flows
Proprietary Funds (Continued)
For the Year Ended June 30, 2003
Business-type Activities -
Carlsbad
Municipal
Water District
Golf
Course Sewer
Reconciliation of operating income (loss) to net cash
provided by operating activities:
Operating income (loss)
Adjustments to reconcile operating income to net cash
provided by operating activities:
Depreciation and amortization
Change in assets and liabilities:
(Increase) decrease in receivables
(Increase) decrease in inventories
(Increase) in prepaid items
(Decrease) in accrued liabilities
Increase in due to other governments
Increase in estimated claims payable
(Decrease) in deposits payable
Net cash provided by (used in) operating activities
Noncash capital financing activities:
Capital assets contributed by other sources
Reconciliation of cash and cash equivalents to amounts
reported on the balance sheet:
Reported on the balance sheet:
Cash and investments
Restricted assets:
Cash and investments
Less investments not meeting the definition of cash
equivalents:
Investment contracts
495,847 $
1,548,278
(93,341) $769,588
1,519,402
672,573
(131,202)
(1,204)
571,877
(341,487)
19,785
$ 2,834,467 $
-
-
-
(4,766)
-
.
(98,107) $
(62,611)
(2,104)
-
663,672
(604,487)
8,809
2,292,269
36,545 $ 10,111,309
$ 52,938,871 $ 2,419,856 $ 64,076,138
740,483
(740,000)
954,212
(939,581)
Cash and cash equivalents at end of year $ 52,939,354 $ 2,419,856 $ 64,090,769
The notes to the financial statements are an integral part of this statement.
52
Enterprise Funds
Solid Waste Totals
Governmental
Activities -
Internal
Service Funds
$ 715,731 $ 1,887,825 $ (1,696,304)
3,067,680 1,683,324
(8,126)
-
-
14,706
-
-
-
$ 722,311 $
601,836
(133,306)
(1,204)
1,245,489
(945,974)
-
28,594
i 5,750,940 $
(9,304)
(10,741)
(61,480)
64,636
-
543,683
-
513,814
$ 12,173,203 $87,674
$ 4,895,962 $ 124,330,827 $ 14,740,680
1,694,695
(1,679,581)
S 4,895,962 $ 124,345,941 $ 14,740,680
53
CITY OF CARLSBAD
Statement of Net Assets
Fiduciary Funds
June 30,2003
ASSETS
Total
Agency
Funds
Current Assets:
Cash and investments
Taxes receivable
Accrued interest
Total current assets
15,267,302
29,766
83,592
15,380,660
Restricted Assets:
Cash and investments
Total assets
LIABILITIES
Accounts payable
Total liabilities
NET ASSETS
Held in trust for contractors, bondholders and other purposes
The notes to the financial statements are an integral part of this statement.
4,017,696
$ 19,398,356
24,862
24,862
$ 19,373,494
54
CITY OF CARLSBAD
Statement of Changes in Net Assets
Fiduciary Funds
June 30,2003
ADDITIONS
Contributions from property owners and developer deposits
Payroll related deposits
Interest income
Other miscellaneous additions
Total additions
Total
Agency
Funds
$ 9,109,104
20,383,761
915,890
9,108
30,417,863
DEDUCTIONS
Administrative expenses
Refunds of developer deposits
Payroll related deposits
Payments to bondholders
Other miscellaneous deductions
Total deductions
Change in net assets
Net assets - beginning
Net assets - ending
The notes to the financial statements are an integral part of this statement.
101,924
1,310,694
20,713,376
4,929,769
189,055
27,244,818
3,173,045
16,200,449
$ 19,373,494
55
CITY OF CARLSBAD
Notes to the Financial Statements
Note 1. Summary of Significant Accounting Policies
The City of Carlsbad, California (City) was incorporated on July 16, 1952. The City operates under a Council-Manager
form of government and provides the following services: general government, public safety, community development,
community services and public works.
The accounting policies of the City and its component units conform to accounting principles generally accepted in the
United States of America as applicable to governmental units. The following is a summary of the more significant
policies:
Description and scope of the reporting entity
As required by accounting principles generally accepted in the United States of America, these financial statements
present the financial position of the City and its component units, entities for which the City is considered to be financially
accountable. The City is considered to be financially accountable for an organization if the City appoints a voting majority
of that organization's governing body and the City is able to impose its will on that organization or there is a potential for
that organization to provide specific financial benefits to or impose specific financial burdens on the City. The City is also
considered to be financially accountable for an organization if that organization is fiscally dependent upon the City (i.e., it
is unable to adopt its budget, levy taxes, set rates or charges, or issue bonded debt without approval from the City). In
certain cases, other organizations are included as component units if the nature and significance of their relationship with
the City are such that their exclusion would cause the City's financial statements to be misleading or incomplete.
Based upon the above criteria, the component units of the City are the Housing Authority of the City of Carlsbad, the City
of Carlsbad Public Improvement Corporation, the Carlsbad Redevelopment Agency and the Carlsbad Municipal Water
District (District).
Since the City Council serves as the governing board for these component units, all of the City's component units are
considered to be blended component units. Blended component units, although legally separate entities, are in substance
part of the City's operations, and so data from these units is reported with the interfund data of the primary government.
Only the City of Carlsbad Public Improvement Corporation and the Carlsbad Redevelopment Agency issue separate
component unit financial statements. Upon their completion, the financial statements of these component units can be
obtained from the Finance department.
Government-wide and Fund Financial Statements
The Government-wide Financial Statements (i.e., the Statement of Net Assets and the Statement of Changes in Net Assets)
report information on all of the nonfiduciary activities of the City and its blended component units. For the most part, the
effect of interfund activity has been removed from these statements. Governmental activities, which normally are
supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a
significant extent on user fees and charges for support.
The Statement of Activities demonstrates the degree to which the direct expenses of a given function or segment are offset
by program revenues. Direct expenses are those that are clearly identifiable to a specific function or segment. Program
revenues include 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or
privileges provided by a given function or segment and 2) grants and contributions that are restricted to meeting the
operational or capital requirements of a particular function or segment. Taxes and other items not properly classified as
program revenues are reported as general revenues.
Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds, even though the
latter are excluded from the Government-wide Financial Statements. Major individual governmental funds and major
individual enterprise funds are reported in separate columns in the Fund Financial Statements.
56
CITY OF CARLSBAD
Notes to the Financial Statements
Note 1. Summary of Significant Accounting Policies (Continued)
Measurement focus, basis of accounting, and financial statement presentation
The Government-wide Financial Statements are reported using the economic resources measurement focus and the accrual
basis of accounting, as are the Proprietary Fund and Fiduciary Fund Financial Statements. Revenues are recorded when
earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. In applying
the susceptible to accrual concept to intergovernmental revenues, the legal and contractual requirements of the individual
programs are used as guidance. Property taxes are recognized as revenues in the year for which they are levied.
Governmental Fund Financial Statements are reported using the current financial resources measurement focus and the
modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available.
Revenues are considered available when they are collectible within the current period or soon enough thereafter to pay
liabilities of the current period. For this purpose, the government considers revenues to be available if they are collected
within 60 days of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as
under accrual accounting. Principal and interest on 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.
Revenues that are accrued generally include real property taxes, sales tax, transient occupancy taxes, franchise taxes,
vehicle license fees, highway users tax, interest, and some state and federal grants.
Real property taxes are levied on October 15 against property owners of record on January 1 of that year. 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 January 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.
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 accrual basis of accounting.
The City reports the following major governmental funds:
The General fund is the City's primary operating fund. It accounts for all financial resources of the general government,
except those required to be accounted for in another fund.
The Redevelopment Debt Service Funds are used to account for the accumulation of resources for, and payment of,
principal and interest on the Carlsbad Redevelopment Agency's bonds and other debt, used to finance improvements for
the redevelopment areas of the City.
The Bridge and Thoroughfare Districts capital project funds are used to account for the receipt of fees charged to
developers and expenditures for street construction within designated district boundaries.
The Community Facilities District No. 1 capital project fund is used to account for civic facilities, freeway interchanges,
and road segments financed by Community Facilities District No. 1 "special tax revenues" (Mello Roos).
The General Capital Construction capital project fund is used to account for transfers from the General fund and
expenditures for various capital projects not financed through another capital project fund.
The Public Facilities Construction capital project fund is used to account for the receipt of fees charged to developers,
and expenditures for specific public facilities such as libraries and fire stations necessitated by growth.
57
CITY OF CARLSBAD
Notes to the Financial Statements
Note 1. Summary of Significant Accounting Policies (Continued)
Measurement focus, basis of accounting, and financial statement presentation (continued)
The City reports the following major enterprise funds:
The Carlsbad Municipal Water District enterprise fund is used to account for the operation, maintenance, and capital
facility financing of the City's water system.
The Golf Course enterprise fund is used to account for revenues and expenses for the construction activities of the City's
proposed municipal golf course.
The Sewer enterprise fund is used to account for the operation, maintenance, and capital facility financing of the City's
sewer system.
The Solid Waste enterprise fund is used to account for the revenues and expenses of the City's solid waste source-
reduction and recycling programs.
Additionally, the City reports the following fund types:
Internal Service funds account for fleet management, health insurance, information technology, records management,
risk management and workers' compensation services provided to other departments or agencies of the City.
The Fiduciary funds account for assets held by the City for other funds, governments or individuals. These funds include
contractors' deposits for future development, miscellaneous deposits, as well as debt service transactions on assessment
district bonds for which the City is not obligated.
Private-sector standards of accounting and financial reporting issued prior to December 1, 1989, generally are followed in
both the Government-wide and Proprietary Fund Financial Statements to the extent that those standards do not conflict
with or contradict guidance of the Governmental Accounting Standards Board (GASB). Governments also have the
option of following subsequent private-sector guidance for their business-type activities and enterprise funds, subject to
this same limitation. The City has elected to follow the standards set by the GASB as opposed to subsequently issued
private-sector guidance.
As a general rule, the effect of interfund activity has been eliminated from the Government-wide Financial Statements.
Exceptions to this general rule are payments of special taxes (CFD #1) by the golf course and charges between the
Carlsbad Municipal Water District and various other functions of the City. Elimination of these charges would distort the
direct costs and program revenues reported for the various functions concerned.
Amounts reported as program revenues include 1) charges to customers or applicants for goods, services, or privileges
provided, 2) operating grants and contributions, and 3) capital grants and contributions. Internally dedicated resources,
such as taxes, are reported as general revenues rather than as program revenues.
Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses
generally result from providing services and producing and delivering goods in connection with a proprietary fund's
principal ongoing operations. The principal operating revenues of the City's proprietary funds are charges to customers
for sales and services. The City also recognizes new account charges, late fees and contributions from other agencies as
operating revenues. Operating expenses for enterprise and internal service funds include the cost of sales and services,
general and administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this
definition are reported as nonoperating revenues and expenses.
When both restricted and unrestricted resources are available for use, it is the City's policy to use restricted resources first,
then unrestricted resources as they are needed.
58
CITY OF CARLSBAD
Notes to the Financial Statements
Note 1. Summary of Significant Accounting Policies (Continued)
Implementation of new accounting principles
> Governmental Accounting Standards Board Statement No. 40
The City adopted GASB Statement No. 40, Deposit and Investment Risk Disclosures - an amendment of GASB
Statement No 3. This Statement modifies disclosure requirements for deposits and investments to address common
deposit and investment risks related to credit risk concentration risk, interest rate risk and foreign currrency risk.
Accordingly, certain footnote disclosures have been revised to conform to the provisions of GASB Statement
No. 40.
> Governmental Accounting Standards Board Statement No. 41
The City adopted GASB Statement No. 41, Budgetary Comparison Schedules - Perspective Differences - an
amendment of GASB Statement No. 34. This Statement clarifies the required supplementary information budgetary
presentation requirements for governments with significant budgetary perspective differences that result in their not
being able to present budgetary comparison information for their general fund and major special revenue funds.
The adoption of this standard did not have a material impact on the City.
Cash and investments
Cash includes amounts in demand and time deposits. Investments are reported in the accompanying balance sheet at fair
value, except for certain certificates of deposit and investment contracts that are reported at cost because they are not
transferable and they have terms that are not affected by changes in market interest rates.
Changes in fair value that occur during a fiscal year are recognized as income from property and investments reported for
that fiscal year. Income from property and investments includes interest earnings; changes in fair value; any gains or
losses realized upon the liquidation, maturity, or sale of investments; property rentals and the sale of City owned property.
The City pools cash and investments of all funds, except for assets held by fiscal agents. Each fund's share in this pool is
displayed in the accompanying financial statements as cash and investments. Investment income earned by the pooled
investments is allocated to the various funds on a monthly basis, based on each fund's average cash and investments
balance.
Restricted cash and investments represent amounts that are restricted under the terms of debt agreements.
Inventories
Inventories consist of materials and supplies that are valued at cost and are recorded as expenses or expenditures on a first-
in, first-out basis when consumed.
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. For compensated
absences recorded at June 30, 2003, 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.
Risk management
The City accounts for its general liability, a portion of its 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.
59
CITY OF CARLSBAD
Notes to the Financial Statements
Note 1. Summary of Significant Accounting Policies (Continued)
Unbilled services
Unbilled water revenue of the enterprise funds is recognized as earned when the water is consumed.
Capital assets
Capital assets, which include land, buildings, equipment and infrastructure assets (e.g., roads, bridges, traffic signals,
water and sewer systems, and similar items), are reported in the applicable governmental or business-type activities
columns in the Government-wide Financial Statements. Capital assets are defined by the City as assets with an initial,
individual cost of more than $10,000 and an estimated useful life in excess of one year. Such assets are recorded at
historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at estimated fair
market value at the date of donation.
The cost of normal maintenance and repairs that do not add to the value of an asset or materially extend an asset's useful
life are not capitalized. Construction in progress costs are transferred to their respective fixed asset category upon
completion.
Depreciation is charged to operations using the straight-line method based on the estimated useful life of an asset. The
estimated useful lives of depreciable assets are as follows:
Years
Buildings and other structures 10-50
Improvements other than buildings 20 - 50
Machinery and equipment 3-20
Infrastructure 10-100
Sewage treatment facility 50
The City capitalized all general infrastructure assets acquired during the two years ended June 30,2003. No infrastructure
assets acquired prior to that time have been capitalized. In addition, the land upon which the streets and roads are
constructed (right-of-way) has not been valued and capitalized. It will be addressed when the remaining infrastructure
assets are capitalized and placed on the City's books. According to GASB 34, the City has until June 30, 2006 to record
its general infrastructure assets acquired prior to the initial adoption of GASB 34.
Deferred revenue
The deferred revenue reported in the City's financial statements represents money received during the current or previous
fiscal years that has not been earned by, or is not available to, the City as of the end of the fiscal year. These monies will
be recognized as revenues in subsequent fiscal years, once the revenue has been earned or becomes available.
Receivables and payables
Activity between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year
are referred to as either "due to/from other funds" (short-term interfund loans) or "advances to/from other funds" (long-
term interfund loans). Any residual balances outstanding between the governmental activities and business-type activities
are reported in the Government-wide Financial Statements as "internal balances."
Advances between funds, as reported in the Fund Financial Statements, are offset by a fund balance reserve account in the
applicable governmental fund to indicate that they are not available for appropriation and are not expendable available
financial resources.
All trade, service and tax receivables are shown net of an allowance for uncollectibles. The utility billing receivable
allowance is equal to 1% of outstanding billings at June 30, 2003, the ambulance billing receivable allowance is equal to
40% of outstanding billings at June 30,2003, and the trade receivable allowance is reserved for on a case-by-case basis.
60
CITY OF CARLSBAD
Notes to the Financial Statements
Note 1. Summary of Significant Accounting Policies (Continued)
Long-term obligations
In the Government-wide Financial Statements, and proprietary fund types in the Fund Financial Statements, long-term
debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business-type
activities, or proprietary fund type Statement of Net Assets. Bond premiums, discounts, and issuance costs are deferred
and amortized over the life of the bonds using the effective interest method. Bonds payable are reported net of the
applicable bond premium or discount. Bond issuance costs are reported as deferred charges and amortized over the term
of the related debt.
In the Fund Financial Statements, governmental fund types recognize bond premiums, discounts, and issuance costs
during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on
debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing
uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service
expenditures.
Fund equity
In the Fund Financial Statements, governmental funds report reservations of fund balance for amounts that are not
available for appropriation or are legally restricted by outside parties for use for a specific purpose. Designations of fund
balance represent tentative management plans, and are subject to change.
Note 2. Budgetary Data
The City follows these procedures in establishing its budgetary data:
» During May or June, the City Manager submits to the City Council a proposed operating and capital budget
for the fiscal year commencing the following July 1. The budget includes estimated revenues and proposed
expenditures on a departmental and/or project basis.
» Public hearings are conducted at City Council meetings to obtain citizens' comments during June.
» 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 from one department to another within a fund.
The legal level of budgetary control is at the fund level. Revisions that alter the total appropriations of any fund must be
approved by the City Council with the exception of budget adjustments that involve offsetting revenues and expenditures.
The City Manager is authorized to increase or decrease an appropriation for a specific purpose where the appropriation is
offset by unbudgeted revenue, which is designated for said specific purpose. Monthly reports are provided to the City
Council during the year, and any changes to the adopted budget are approved by the City Council as necessary. 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.
Expenditures may not exceed budgeted appropriations at the fund level. All appropriations lapse at fiscal year-end unless
City Council takes action in the form of a resolution to continue the appropriation into the following fiscal year.
61
CITY OF CARLSBAD
Notes to the Financial Statements
Note 2. Budgetary Data (Continued)
For purposes of budgetary presentation, actual revenues have been adjusted to exclude unrealized gains and losses
pursuant to GASB 31, actual expenditures have been adjusted to include encumbrances outstanding, and transfers out have
been adjusted to reflect any transfer that was approved through the budget process as an expenditure but recorded as an
advance in the financial statements. Annual budgets are adopted for the General, special revenue and debt service funds
except for the Hosp Grove COPs. Accordingly, the revenues and expenditures for this fund 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.
Note 3. Deposit and Investment Risk
Cash resources of the individual funds are combined to form a pool of cash and investments. The City maintains a formal
investment policy, which is reviewed by the Investment Committee and adopted annually by the City Council. All
investments held in the Treasurer's Pool are consistent with the City's investment policy objectives of safety of principal,
adequacy of liquidity, and achievement of an average market rate of return. The risk disclosures below apply to the City's
internal investment pool. Portfolio investments are exposed to two main types of risk: credit (investments and cash
deposits, including custodial and concentration risk), and market or interest rate risk.
Investments held outside the Treasurer's Pool consist mainly of required reserve funds for various bond issues. They are
held by trustees, and are not available for the City's general expenditures.
62
CITY OF CARLSBAD
Notes to the Financial Statements
Note 3.Deposit and Investment Risk (Continued)
As of June 30, 2003 the City had the following investments in its portfolio:
Treasurer's Pool Investments
U. S. Agencies:
Federal Home Loan Bank
Federal Home Loan Mortgage Corporation
Federal National Mortgage Association
Other U.S. Agencies
Subtotal U. S. Agencies
Medium-Term Corporate Notes:
Citigroup/Associates/Commercial Credit
Other medium-term corporate notees
Subtotal Corporate Notes
LAIF
Cash Accounts
Total Treasurer's Pool
Investments held outside the Treasurer's Pool
Debt Service Funds/Bond Proceeds
Other Deposits
Petty Cash Funds
Total Cash and Investments
Statement of Net Assets, Primary Government
Cash and Investments
Restricted Cash and Investments
Statement of Net Assets, Fiduciary Funds
Cash and Investments
Restricted Cash and Investments
Total Cash and Investments
Fair Market
Value
90,575,855
73,251,022
42,254,186
9,206,466
215,287,529
25,515,677
92,794,447
118,310,124
106,921,852
1366,042
441,885,547
7,488,993
349,256
6,063
$ 449,729^59"
428,080,482
2,364,379
15,267,302
4,017,696
$ 449,729^859"
%of
Total
20.5%
16.6%
9.6%
2.0%
48.7%
5.8%
21.0%
26.8%
24.2%
0.3%
100.0%
Modified
Duration
2.653
2.837
2.379
2.905
2.672
0.068
2.049
2.117
1.853
Custodial Credit Risk (Investments): The City uses Union Bank of California (UBC) as a third-party custody and
safekeeping service for its investment securities. Custodial credit risk is the risk that the City will not be able to recover
the value of its investments in the event of a UBC failure. All City investments held in custody and safekeeping by UBC
are held in the name of the City and are segregated from securities owned by the bank. This is the lowest level of
custodial credit risk exposure.
Custodial Credit Risk (Deposits): The City maintains cash accounts at Wells Fargo Bank (WFB) and UBC. At the
conclusion of each business day, balances in these accounts are "swept" into overnight investments, which are in either
U.S. government securities (guaranteed) or in U.S. agency securities (government sponsored). The California Code and
the City's Investment Policy authorize both of these types of investments. A small amount of cash is not swept from the
WFB checking accounts to cover checks that may be presented for payment. Amounts up to $100,000 are FDIC insured.
63
CITY OF CARLSBAD
Notes to the Financial Statements
Note 3. Deposit and Investment Risk (Continued)
Concentration Credit Risk: Concentration credit risk is the heightened risk of potential loss when investments are
concentrated in one issuer. The California state code requires that total investments in medium-term corporate notes of all
issuers not exceed 30% of the portfolio. As of June 30,2003, approximately 25% of the City's total portfolio investments,
based on cost, were in medium-term corporate notes.
For concentration of investments in any one issuer, the City's Investment Policy requires that no more than 5% of
investments in corporate notes be in any one issuer. There is no similar requirement in either the state code or the City's
Investment Policy for U.S. agencies. As of June 30, 2003, 5.63% of the portfolio based on cost was invested in Citigroup
Corporation. Mergers subsequent to the investments involved resulted in this exception. The credit ratings of Citigroup
Corporation debt are AA1 and AA-. At this point, the City Treasurer intends to retain all Citigroup investments. This
exception to City's Investment Policy will self-correct with maturities in March 2004.
Default Credit Risk: Default credit risk is the risk that the issuer of the security does not pay either the interest or the
principal when due. The debts of most U.S. agencies are not backed by the full faith and credit of the federal government;
however, because the agencies are U.S. government-sponsored, they carry AAA credit ratings. The default credit risk of
these investments is minimal.
California state code limits investments in medium-term corporate notes to the top three credit ratings (AAA, AA, and A).
It is the City's policy, however, to limit investments to the top two credit ratings (AAA and AA). As of June 30, 2003,
approximately 49% of the investments in medium-term corporate notes had credit ratings below the AA limit set by the
City's Investment Policy. All of these investments were made when the credit ratings were either AAA or AA. California
state code and the City's Investment Policy allow the City Treasurer to determine the course of action to correct
exceptions to the Policy. It is the intent of the City Treasurer to hold these investments in the portfolio until maturity
unless events indicate they should be sold. The default credit risk for corporate notes with a credit rating of single A is
lower than U.S. federal agencies or LAIF, but is considered by the City Treasurer to be within acceptable limits for
purposes of holding to maturity. A credit rating of single A is within State code requirements.
The Local Agency Investment Fund (LAIF) is an investment pool managed by the California State Treasurer. Its
investments are short term and follow the investment requirements of the State. As of June 30, 2003, the average maturity
of the LAIF investments was 220 days. The default credit risk of LAIF is minimal.
Interest Rate Risk: Interest rate risk is the risk that investments will lose market value because of increases in market
interest rates. A rise in market interest rates will cause the market value of investments made earlier at lower interest rates
to lose value. The reverse will cause a gain in market value. As of June 30, 2003, the portfolio had a 3.3% gain in market
value.
The City's investment policy has adopted two means of limiting its exposure to market value losses caused by rising
market interest rates: (1) limiting total portfolio investments to a maximum modified duration of 2.2, and (2) requiring
maturing investments within one year be equal to an amount that is not less than the current fiscal year's operating budget.
1. As of June 30, 2003, the modified duration of the portfolio was 1.85. Modified duration is a measure of the
sensitivity that the value of a fixed-income security has to changes in market rates of interest. Modified duration
identifies the potential gain/loss in value before the gain/loss actually occurs. It is a prospective measurement,
e.g., a modified duration of 1.5 indicates that when and if a 1% change in market interest rates occurs, a 1.5%
change in the value of a security will result. Investments with modified durations of one to three are considered
to be relatively conservative.
2. Maturities within one year were $203,000 below the required minimum of $140,000,000 (fiscal year 2002-03
operating budget).
64
CITY OF CARLSBAD
Notes to the Financial Statements
Note 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, 2003:
Due to Due from
Other Funds Other Funds
General $ - $ 570,524
Special Revenue Funds:
Section 8 Housing Authority 502,000
Capital Project Funds:
Federal Grants - Intermodal Surface Transportation Efficiency Act 67,182
Other Capital Project Funds 1,342 -
Totals $ 570,524 $ 570,524
These balances resulted from expenditures being incurred prior to receipt of the related revenue source.
Note 5. Advances to and from Other Funds
The following table shows amounts advanced from governmental funds within the City to other funds within the City at
June 30,2003:
Advances From
General Fund
General Fund
General Fund
General Fund
Special Revenue Funds:
Gas Tax
Capital Projects Funds:
General Capital Construction
Advances To
Redevelopment Debt Service Fund
Park Development Capital Projects Fund
Storm Water Protection Special Revenue Fund
Golf Course Enterprise Fund
Bridge and Thoroughfare District Capital
Project Fund
Capital Projects Funds:
Park Development
Bridge and Thoroughfare District #2
Assessment and Other Districts
Amount
$ 13,070,949
550,000
1,076,419
2,737,200
4,643,344
3,430,000
840,000
990,854
$ 27,338,766
Advances to and from other funds are primarily long term advances used to fund capital projects in advance of related
revenues.
65
CITY OF CARLSBAD
Notes to the Financial Statements
Note 6. Capital Assets
Capital asset activity was as follows for the
Governmental activities:
Capital assets, not being depreciated:
Land
Construction in progress
Total capital assets,
not being depreciated
Capital assets, being depreciated:
Buildings
Improvements
Machinery and equipment
Infrastructure
Total capital assets,
being depreciated
Less accumulated depreciation for:
Buildings
Improvements
Machinery and equipment
Infrastructure
Total accumulated depreciation
Total capital assets
being depreciated, net
year ended June 30, 2003:
Balance at
July 1,2002
$ 47,077,223 $
69,948,610
117,025,833
66,638,374
10,328,751
20,636,182
24,402,704
122,006,011
(10,193,967)
(2,022,953)
(9,493,560)
-
(21,710,480)
100,295,531
Increases
7,307,961
25,789,221
33,097,182
-
55,494
2,136,641
33,029,168
35,221,303
(1,372,041)
(404,063)
(2,280,789)
(530,126)
(4,587,019)
30,634,284
Balance at
Decreases June 30, 2003
$ - $ 54,385,184
(15,485,112) 80,252,719
(15,485,112) 134,637,903
66,638,374
10,384,245
(1,309,615) 21,463,208
57,431,872
(1,309,615) 155,917,699
(11,566,008)
(2,427,016)
789,381 (10,984,968)
(530,126)
789,381 (25,508,118)
(520,234) 130,409,581
Governmental activities
capital assets, net $ 217,321,364 $ 63,731,466 $ (16,005,346) $ 265,047,484
66
CITY OF CARLSBAD
Notes to the Financial Statements
Note 6. Capital Assets (Continued)
Balance at
July 1,2002
Business-type activities:
Capital assets, not being depreciated:
Land
Construction in progress
Total capital assets, not being
depreciated
Capital assets, being depreciated:
Buildings
Improvements, other than buildings
Machinery and equipment
Infrastructure
Sewage treatment facility
Total capital assets, being
depreciated
Less accumulated depreciation for:
Buildings
Improvements
Machinery and equipment
Infrastructure
Sewage treatment facility
Total accumulated depreciation
Total capital assets
being depreciated, net
$ 8,663,600 :
27,523,616
36,187,216
2,258,064
5,108,962
1,612,818
115,767,359
35,359,277
160,106,480
(720,375)
(1,735,195)
(1,128,882)
(29,395,178)
(9,247,690)
(42,227,320)
117,879,160
Increases
$
12,488,763
12,488,763
-
447,609
36,147
12,791,752
573,869
13,849,377
(55,443)
(104,238)
(84,504)
(2,132,823)
(690,672)
(3,067,680)
10,781,697
Balance at
Decreases June 30, 2003
$ - $ 8,663,600
(2,219,432) 37,792,947
(2,219,432) 46,456,547
2,258,064
5,556,571
(82,982) 1,565,983
128,559,111
(29,412) 35,903,734
(112,394) 173,843,463
(775,818)
(1,839,433)
53,175 (1,160,211)
(31,528,001)
(9,938,362)
53,175 (45,241,825)
(59,219) 128,601,638
Business-type activities
capital assets, net $ 154,066,376 $ 23,270,460 $ (2,278,651) $ 175,058,185
67
CITY OF CARLSBAD
Notes to the Financial Statements
Note 6. Capital Assets (Continued)
Depreciation expense was charged to functions/programs of the primary government as follows:
Governmental activities:
General government $ 528,814
Community development 165,468
Public safety 440,501
Community services 1,112,285
Public works 656,627
Capital assets held by the internal service funds
(charged to various functions based on
their usage of the assets) 1,683,324
Total depreciation expense - governmental activities $ 4,587,019
5SZ ^^—•
Business-type activities:
Sewer $ 1,519,402
Water 1,548,278
Total depreciation expense - business-type activities $ 3,067,680
68
CITY OF CARLSBAD
Notes to the Financial Statements
Note 7.Accrued Liabilities
Accrued liabilities were as follows at June 30,2003:
Governmental Funds:
General Fund
Bridge and Thoroughfare
Districts
Community Facilities
District No. 1
General Capital Construction
Public Facilities
Construction
Other Governmental Funds
Total Governmental Funds
Business-type Activities:
Enterprise funds:
Carlsbad Municipal Water
District
Sewer
Solid Waste
* Internal Service Funds
Total Business-type
Activities
Salaries and IFD
Vendors Benefits Payable
Refuse
Disposal
$ 1,229,843 $ 3,649,492 $ 79,006
222,487
65,233
78,875
259,059
1,953,873 166,569
$3,809,370 $3.816,061 $79,006 $
Total
$4,958,341
222,487
65,233
78,875
259,059
2,120,442
$7,704,437
$1,260,001
1,136,908
14,807
539,114
$2,950,830
$ 378,793 $
64,791
1,555
213,209
$ 658,348 $
$ - $1,638,794
1,201,699
228,452 244,814
752,323
$ 228,452 $ 3,837,630
*Intemal service funds have been included with governmental activities on the Government-wide Statement of Net Assets.
69
CITY OF CARLSBAD
Notes to the Financial Statements
Note 8.Long-term Debt
The following is a summary of changes in the principal balance of long-term debt for the year ended June 30, 2003:
Governmental activities:
Bonds
Certificates of participation
HUD Section 108 loan
Obligations under capital leases
Total governmental activities
Business-type activities:
Certificates of participation
Installment purchase agreement
Loan payable
Accrued assessments
Less deferred charges
Total business type activities
Entity-wide total
Principal
Balance at
June 30, 2002 Additions Reductions
Principal
Balance at
June 30, 2003
Due Within
One Year
$13,540,000
4,515,000
329,950
790,907
19,175,857
340,000
565,000
160,000
612,206
$ 13,200,000
3,950,000
169,950
178,701
$ 360,000
590,000
169,950
100,194
1,677,206 17,498,651 1,220,144
2,295,000 $
8,870,000
1,574,224
621,025
13,360,249
(751,229)
12,609,020
1,120,000
495,000
113,874
177,912
1,906,786
(107,146)
1,799,640
1,175,000
8,375,000
1,460,350
443,113
11,453,463
(644,083)
10,809,380
1,175,000
520,000
117,177
186,060
1,998,237
(21,262)
1,976,975
$31,784,877 $$3,476,846 $28,308,031 $3,197,119
70
CITY OF CARLSBAD
Notes to the Financial Statements
Note 8. Long-term Debt (Continued)
Long-term debt at June 30, 2003 is comprised of the following issues:
Balance at
Governmentai long-term debt June 30, 2003
1993 Carlsbad Housing and Redevelopment Commission Tax Allocation
Bonds, principal due in amounts ranging from $360,000 to $1,000,000 on
September 1 of each year through 2024. Interest payable on March 1 and
September 1 at rates varying from 5.25% to 5.30% per annum. The City
posted a surety bond in lieu of cash reserve in the amount of $1,055,953. $ 13,200,000
1997 Hosp Grove Refunding Certificates of Participation, principal due in
amounts ranging from $590,000 to $735,000 on August 1 of each year
through 2009, interest payable on August 1 and February 1 at rates varying
from 4.30% to 4.70% per annum. Payable from the General Fund, with a
required reserve amount of $659,500. 3,950,000
Community Development Block Grant (CDBG) program - Section 108
loan payable to HUD. Funds used to acquire property for affordable
housing project. Final payment of principal and interest due August 1, 2004.
Principal is $ 169,950; interest is $7,030 at 8.27% per annum. 169,950
The City has entered into several office equipment lease-purchase
agreements. As of June 30,2003, the City has purchased copier equipment
totaling $456,783. All lease terms are for 60 months, with interest rates
ranging from 5.56% to 16.82%. 178,701
Sub-total governmental long-term debt 17,498,651
Less current portion 1,220,144
Total long-term portion of governmental debt $ 16,278,507
71
CITY OF CARLSBAD
Notes to the Financial Statements
Note 8.Long-term Debt (Continued)
Business-type long-term debt
Balance at
June 30, 2003
1997 Carlsbad Municipal Water District Refunding Certificates of
Participation, final principal of $1,175,000 due on May 1, 2004,
final interest payments of $25,850 payable on both November 1,2003 and
May 1, 2004 at 4.4% per annum. The required reserve amount is $740,000.
1997 Encina Financing Joint Powers Authority (EFJPA) Installment Purchase
Agreement, principal due in varying amounts ranging from $520,000 to
$905,000 on August 1 of each year through 2015, interest payable on
February 1 and August 1 each year at rates varying from 4.50% to 5.50% per
annum. The required reserve amount is $939,581.
1993 Carlsbad Municipal Water District loan agreement with the State
Water Resources Control Board. Principal is due in varying amounts
ranging from $ 117,177 to $ 151,558 on November 30 of each year through
2013, interest payable on November 30 of each year at 2.90% per annum.
In December 1994, the Golf Course Enterprise Fund purchased land
with accrued assessments. Principal is due in varying amounts ranging
from $186,060 to $196,925 through 2004-05. The 2005-06 principal amount
of $206,432 will be reduced by a reserve fund credit of $146,304 which is
already reflected on the City's books.
Subtotal business-type long-term debt
Less unamortized discounts, issuance costs and deferred charges
Less current portion
Total long-term portion of business-type debt
The aggregate maturities of long-term debt are as follows:
Governmental Activities Business-Type Activities
$ 1,175,000
8,375,000
1,460,350
443,113
11,453,463
644,083
1,976,975
$ 8,832.405
Year ended June 30:
2004
2005
2006
2007
2008
2009-2013
2014-2018
2019-2023
2024-2028
Principal
$ 1,220,144
1,069,907
1,037,896
1,090,704
1,140,000
3,315,000
3,330,000
4,295,000
1,000,000
$ 17,498,651
Interest
$ 870,116
808,825
756,975
706,090
652,310
2,642,873
1,854,113
856,337
26,500
$ 9,174,139
Principal
$ 1,998,237
867,500
759,200
732,670
771,372
4,436,265
1,888,219
-
-
$ 11,453,463
Interest
$ 539,409
448,706
407,274
360,801
323,661
1,026,903
94,289
-
-
$ 3,201,043
72
CITY OF CARLSBAD
Notes to the Financial Statements
Note 9. Rate Covenants
The 1997 Carlsbad Municipal Water District Refunding Certificates of Participation require that the District set its charges
for services each year at rates sufficient to produce net revenues (after paying the operating and maintenance expenses of
the District, excluding depreciation) at least 1.15 times the debt service for that year.
The 1997 Encina Financing Joint Powers Authority Installment Purchase Agreement (Wastewater Revenue Bonds) require
that the District set its charges for services each year at rates sufficient to produce net revenues (after paying the operating
and maintenance expenses of the District, excluding depreciation) of at least 1.25 times debt service for that year.
Note 10. Debt Without Government Commitment
Special assessment bonds
As of June 30, 2003, the City has four series of Assessment District Bonds outstanding in the amount of $36,986,881.
These bonds were issued under the provisions of the Improvement Bond Acts of 1911 and 1915 and were used to finance
public infrastructure improvement projects. The City collects assessments to pay the bond debt. These monies are
accounted for in the Assessment District Agency Funds.
Mortgage revenue bonds
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 which will be partially occupied by persons of low or moderate
income. The total amount of mortgage revenue bonds outstanding as of June 30, 2003 is $49,552,000. 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 deeds of trust, irrevocable letters of
credit, and irrevocable surety bonds.
Industrial development bonds
The Industrial Development Authority (Authority) of the City has issued $3,172,500 in Industrial Development Revenue
Bonds. Any costs relating to the issuance of the Bonds, as well as the principal and interest payments, are to be paid by
the private party benefiting from the bond issue.
In the opinion of City officials, the above 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 accompanying financial statements.
73
CITY OF CARLSBAD
Notes to the Financial Statements
Note 11. Fund Balances/Retained Earnings
The following is a summary of reserved and unreserved
Fund Balances
Reserved for:
Loans receivable $
Inventory
Prepaid items
Debt service
Advances to other funds*
Flower fields preservation
Library endowment
Low and moderate income
housing
Habitat and nearshore reef
mitigation
Encumbrances
Subtotal
Unreserved:
Designated for approved
capital projects
Designated for continuing
appropriations
Subtotal
General
179,744
20,748
54,605
-
8,528,297
-
-
-
905,823
3,105,070
12,794,287
-
12,873,309
12,873,309
fund balances as of June 30, 2003:
Governmental Fund Types
Special Debt Capital
Revenue Service Projects
$ 9,284,699 S - $
-
343,247
659,500
4,643,344 - 5,260,854
935,000
251,000
3,284,650
.
1,007,691 - 18,595,155
19,749,631 659,500 23,856,009
2,457,719 - 102,173,143
1,698,529 - 50,725,586
4,156,248 - 152,898,729
Total
$ 9,464,443
20,748
397,852
659,500
18,432,495
935,000
251,000
3,284,650
905,823
22,707,916
57,059,427
104,630,862
65,297,424
169,928,286
Undesignated
Total fund balances
45,469,287 16,854,136 (10,448,729) 18,328,217 70,202,911
$ 71,136,883 $ 40,760,015 $ (9,789,229) $195,082,955 $297,190,624
* Only reflects that portion of fund balance invested in interfund advances (the General fund amount is net of $8,906,271
in deferred revenue for measurable but unavailable interest earned on such advances).
74
CITY OF CARLSBAD
Notes to the Financial Statements
Note 11. Fund Balances/Retained Earnings (Continued)
Business-type Funds
Net Assets
Invested in capital assets, net of related debt
Restricted for capital assets
Unrestricted
Enterprise
$ 163,206,299 5
96,666,368
25,245,648
$ 285,118,315 3
Internal
Service
i 6,532,907
11,233,741
; 17,766,648
Reserves for loan receivables, inventory, prepaid items 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 flower-fields preservation represent resources set aside to support floriculture research for the preservation of
the "Flower Fields" located in Carlsbad.
Reserves for library endowment represent resources set aside to support programs in the Dove Library auditorium.
Reserves for habitat and nearshore reef mitigation represent resources set aside as security for the construction of wetland
habitat to ensure the mitigation of certain species required as part of the Cannon Road West project, and for the City's
share of potential environmental mitigation costs of the Regional Beach Sand project.
Reserves for encumbrances represent commitments related to unperformed contracts for services and undelivered goods.
Unreserved-undesignated and unrestricted represents the fund balance or net assets remaining after reduction for reserved
and designated fund balances or net assets.
Note 12. Accumulated Fund Deficits/Negative Net Assets
The following funds reported deficits in fund balances or net assets as of June 30,2003:
Deficit Balance
Debt Service Funds:
Redevelopment Areas
Special Revenue Funds:
Storm Water Program
Internal Service Funds:
Workers' Compensation
$ (11,039,854)
S (962,741)
$ (798,981)
75
CITY OF CARLSBAD
Notes to the Financial Statements
Note 13. Interfund Transfers
Interfund transfers for the year ended June 30, 2003, consisted of the following:
Fund
Transfers
In From
Other Funds
Transfers
Out To
Other Funds
Major Funds:
General
Redevelopment, Debt Service Funds
Capital Project Funds:
Community Facilities District No. 1
General Capital Construction
Public Facilities Construction
Nonmajor Governmental Funds
Golf Course Enterprise Fund
Internal Service Funds
$ 1,214,472
35,196,189
584,905
10,850,176
600,000
134,817
$ 40,059,818
282,000
5,692,343
29,252
2,517,146
Totals $ 48,580,559 $ 48,580,559
Transfers are used to (1) move receipts restricted to debt service from the funds collecting the receipts to the debt service
fund as debt service payments become due, (2) move the remaining fund balances of closed funds to the General fund, and
(3) use unrestricted revenues collected in the General fund to finance various programs accounted for in other funds in
accordance with budgetary authorizations.
Note 14. Risk Management
The City is exposed to various risks of loss related to its operations, including losses associated with errors and omissions
and injuries to employees and members of the public. The City uses a Risk Management Self-Insurance fund, a Health
Insurance fund and a Workers' Compensation fund (all internal service funds) to account for and finance its uninsured
risks of loss. All funds of the City make payments based on estimates of the amounts needed to pay prior and current year
claims and to establish a reserve for catastrophe losses.
Since July 1, 1999, the City has been a member of the California Municipal Excess Liability Program, a group purchase
program for general liability coverage. Under this program, the pool provides coverage up to a maximum of $10,000,000
per occurrence with a self-insured retention provided by the City in the amount of $500,000. At June 30, 2003, the
unencumbered fund equity for the Risk Management Self-Insurance fund was approximately $1,400,000.
Health insurance coverage for City employees is provided by either Kaiser, CalPERS, Sharp Healthcare or the Reliastar
plan. Approximately 21% of the City's benefited employees are covered through the Reliastar plan which is administered
by CoreSource. Under the City's agreement with Reliastar, Reliastar will provide coverage for each individual claim over
$75,000. As of July 1, 2003, the City moved all employees to a new CalPERS plan and is no longer administering a self-
insured health insurance plan.
The City is insured for workers' compensation claims by Continental Casualty. Continental Casualty provides coverage
for losses which exceed the City's self-insured retention of $1,000,000 per claim.
76
CITY OF CARLSBAD
Notes to the Financial Statements
Note 14. Risk Management (Continued)
The estimated claims payable reported at June 30, 2003 is based on the requirements of Governmental Accounting
Standards Board Statement No. 10, which requires that a liability for claims be reported if information prior to the
issuance of the financial statements indicates that it is probable that a liability has been incurred at the date of the financial
statements and the amount of the loss can be reasonably estimated. Changes in the estimated claims payable amounts in
fiscal years 2002 and 2003 for the three internal service funds are as follows:
Claims
Health Insurance fund:
2001-2002
2002-2003
Beginning
Balance
$ 272,917
$ 324,340
Expense and
Changes in
Estimates
$ 1,237,549
$ 1,223,712
Claim
Payments
$ (1,186,126)
$ (1,247,103)
Ending
Balance
$ 324,340
$ 300,949
Risk Management fund:
2001-2002
2002-2003
Workers' Compensation fund:
2001-2002
2002-2003
640,001
1,001,635
969,475
1,159,351
537,362
123,794
892,658
1,807,792
(175,728)
(421,026)
(702,782)
(956,652)
1,001,635
704,403
1,159,351
2,010,491
Note 15.Joint Ventures
Encina Water Pollution Control Facility
The Encina Water Pollution Control Facility (the Facility) is a sewer facility owned jointly by the Cities of Carlsbad, Vista
and Encinitas and the Leucadia County Water District, the Buena Vista Sanitation District and the Vallecitos Water
District. The Encina Wastewater Authority (EWA) is a joint powers authority established to operate and administer the
facility. It is responsible for the management, maintenance and operations of the joint system. Ownership interests in the
facility are determined by joint agreement at the time the assets are acquired. As of June 30, 2003, the Cities and Districts
have the following approximate ownership interest:
City of Carlsbad
City of Vista
Leucadia County Water District
Vallecitos Water District
Buena Vista Sanitation District
City of Encinitas
25%
22%
20%
20%
8%
5%
EWA's financial statements for the fiscal year ended June 30, 2002 (the latest available) incorporated the provisions of
GASB 34 and reflect the following:
Total assets
Total liabilities
Net assets
47,869,634
1,999,516
$ 45,870,118
The EWA does not recognize net income or loss. Net operating expenditures in excess of users' assessments are treated as
accounts receivable on EWA'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 revenue for the EWA totaled $417,044 in fiscal year 2002. The
financial statements of the EWA can be obtained at 6200 Avenida Encinas, Carlsbad, California 92009.
77
CITY OF CARLSBAD
Notes to the Financial Statements
Note 15. Joint Ventures (Continued)
Encina Financing Joint Powers Authority
The Encina Financing Joint Powers Authority (the Authority) was created on February 1, 1989 between the City of
Carlsbad (Carlsbad), the City of Vista (Vista), the Buena Vista Sanitation District (Buena) and the Leucadia County Water
District (Leucadia). The primary purpose of the Authority is to issue revenue bonds in order to finance the expansion of
the Facility.
The Authority is governed by a Board of Directors, which consists of one director appointed by each member. The
financial statements of the Authority can be obtained at the City of Carlsbad's Finance department.
In August 1989, the Authority issued $33,500,000 of revenue bonds and executed installment purchase agreements for
approximately the same amount. In February 1997, bonds were issued by the Authority to refinance and defease the
outstanding bonds. Two of the members (Buena and Vista) defeased their 1989 obligations through available funds; while
Carlsbad and Leucadia refinanced their obligations. Repayment of the bonds will be accomplished through payments
made by Carlsbad and Leucadia pursuant to the new installment purchase agreements. The individual agreements set forth
the purchase price and specify the debt service requirements for each member.
The following is a table of the outstanding balance owed as of June 30,2003:
Member
City of Carlsbad
Leucadia County Water District
Agreement
Balance
$ 8,375,000
5,710,000
$ 14,085,000
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. Significant covenants within the agreements require the members to
maintain insurance on the facility, and 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 1.25 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 a fixed asset of the Sewer Enterprise Fund.
Note 16. Retirement Plan
Plan description
The City of Carlsbad contributes to the California Public Employees' Retirement System (PERS), an agent multiple-
employer public employee defined benefit pension plan. PERS provides retirement and disability benefits, annual cost-of-
living adjustments, and death benefits to plan members and beneficiaries. PERS acts as a common investment and
administrative agent for participating public entities within the State of California. Benefit provisions, and all other
requirements, are established by state statutes and city ordinances. Copies of PERS' annual financial report may be
obtained from their executive office: Lincoln Plaza, 400 P Street, Sacramento, California 95814.
Funding policy
Participants are required to contribute 7% (9% for safety employees) of their annual covered salary. The City makes the
contributions required of the City's miscellaneous and fire employees on their behalf and for their account. The City
makes 8% of the required 9% contributions for the City's police employees. The amount paid by the City on behalf of
employees for the year ended June 30, 2003 was $2,630,411. The City is required to contribute at an actuarially
determined rate. For the year ended June 30, 2003, the employer contribution rate for the City of Carlsbad (as a
percentage of covered payroll) was 3.504% for safety employees and 0.0% for miscellaneous employees. The
contribution requirements of plan members and the City are established by PERS.
78
CITY OF CARLSBAD
Notes to the Financial Statements
Note 16. Retirement Plan (Continued)
In October 2003, the City was notified by PERS that for the year ended June 30, 2004, the employer contribution rate for
the City of Carlsbad (as a percentage of covered payroll) will be 27.573% for safety employees and 6.938% for
miscellaneous employees.
Annual pension cost
For 2003, the City's annual pension cost (employer contribution) of $473,370 for safety and $0 for miscellaneous to PERS
was equal to the City's required and actual contributions. For 2003, the member contributions paid by the City were
$1,072,984 for safety and $1,557,427 for miscellaneous. The required contribution was determined as part of the June 30,
2000, actuarial valuation using the entry age normal actuarial cost method. The actuarial assumptions included (a) 8.25%
investment rate of return (net of administrative expenses), (b) projected annual salary increases of 3.75%, and (c) 2% per
year cost-of-living adjustments. Both (a) and (b) included an inflation component of 3.5%. The actuarial value of PERS
assets was determined using techniques that smooth the effects of short-term volatility in the market value of investments
over a four-year period (smoothed market value). PERS unfunded actuarial accrued liability is being amortized as a level
percentage of projected payroll on a closed basis. The remaining amortization period for miscellaneous employees at
June 30, 2003 is through June 30, 2020; for safety employees at June 30,2003, it is through June 30, 2011.
Three-year trend information for PERS (safety)
Annual Pension
Fiscal Year
Ending
6/30/01
6/30/02
6/30/03
Cost (Employer
Contribution)
$ 370,444
$ 472,638
$ 473,370
Percentage of
APC Contributed
100%
100%
100%
Net Pension
Obligation
Three-year trend information for PERS (miscellaneous)
Fiscal Year
Ending
6/30/01
6/30/02
6/30/03
Annual Pension
Cost (Employer
Contribution)
$ 5,607
$
$
Percentage of
APC Contributed
100%
100%
100%
Net Pension
Obligation
$
$
$
Required supplementary information
Funded status of plan (safety)
Valuation
Date
6/30/99
6/30/00
6/30/01
Entry Age
Normal
Accrued
Liability
$ 59,160,306
$ 70,002,794
$ 77,957,502
Actuarial
Value
of Assets
$ 73,078,737
$ 84,606,890
$ 87,913,468
Unfunded
Liability/
(Excess
Assets)
$(13,918,431)
$(14,604,096)
$ (9,955,966)
Funded
Status
123.5%
120.9%
112.8%
Annual
Covered
Payroll
$ 9,784,191
$ 10,319,561
$ 11,581,444
UAAL
As a %
of Payroll
(142.254%)
(141.519%)
(85.965%)
79
CITY OF CARLSBAD
Notes to the Financial Statements
Note 16. Retirement Plan (Continued)
Funded status of plan (miscellaneous)
Valuation
Date
6/30/99
6/30/00
6/30/01
Entry Age
Normal
Accrued
Liability
$ 62,314,238
$ 71,350,783
$ 79,229,253
$
$
$
Actuarial
Value
of Assets
84,329,881
94,556,898
99,603,848
Unfunded
Liability/
(Excess
Assets)
$(22,015,643)
$(23,206,115)
$(20,374,595)
Funded
Status
135.3%
132.5%
125.7%
Annual
Covered
Payroll
$ 16,405,530
$ 19,396,170
$ 21,056,410
UAAL
As a %
of Payroll
(134.196%)
(119.643%)
(96.762%)
Note 17.Post-Retirement Health Care
In addition to the pension benefits described herein, per Resolution 614, all former employees of the Carlsbad Municipal
Water District (including dependents) are eligible for post-retirement health care benefits if they 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, fourteen retirees meet these eligibility requirements and are receiving benefits.
The City pays for 100% of the premiums for health insurance which is 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 were approximately $79,300
for post-retirement health care costs during 2002-2003. 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.
Note 18. Commitments and Contingencies
Operating lease
In June 1988, the Carlsbad Redevelopment Agency entered into an agreement to lease a parking lot on State Street from a
private party. The lease requires monthly rental payments, adjusted annually based upon an increase in the consumer price
index, not to exceed 6% of the previous year's rents, and re-adjusted in years 10 and 15 based upon market rental values,
through August 2007.
Minimum future rental payments under the operating lease as of June 30,2003 are:
2004
2005
2006
2007
2008
Total minimum future rental payments
79,000
79,000
79,000
79,000
7,000
323,000
80
CITY OF CARLSBAD
Notes to the Financial Statements
Note 18. Commitments and Contingencies (Continued)
Contingencies
Litigation
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, because the City has set aside sufficient monies to cover confirmed adverse actions.
During the year ended June 30, 2002, the City was involved in a consolidated claim involving the acquisition of right-of-
way for the construction of a public works project in which the City was ordered by the trial court to pay approximately
$3,200,000 for physical and economic cost and damages and legal costs suffered by property owners. At June 30, 2003,
the City had deposited with the San Diego County Treasury, approximately $3,200,000 related to the above claim. The
City appealed the economic damages and legal costs of the judgment, consisting of damages to unaffixed, moveable
personal property and to improvements pertaining to realty. The Court of Appeals reversed the original decision. The
condemnees have petitioned the California Supreme Court for review; however, it is the belief of the City's legal counsel
that a review of the case is unlikely. As such, as of June 30,2003, no amounts have been accrued for the claim.
Property Taxes
In November 2001, an Orange County Superior Court Judge ruled that the Orange County Assessor's Office violated
Proposition 13 by increasing the taxable value of a Seal Beach residence by 4% in a single year (1998). County attorneys
argued that the assessment was legal because it made up for years in which the property value did not increase. The county
maintains it was merely "recapturing" the full tax value of the property, charging 2% for each of the years the property
values did not rise. On December 12,2002, the Superior Court certified class action status for this case and the Court and
Tax Collector are currently addressing when and if notification to the taxpayers should be executed.
In 2002, two other local courts (Los Angeles and San Diego) ruled differently on the same issue and both affirmed the
current statewide practice of property assessment restoration (i.e.; the local courts differ on this issue). The property tax
laws are applied on a statewide basis and the contradicting ruling with two other local courts on the same legal issue
require a uniformity review at the appellate level. With this notice, the Court of Appeals will establish a briefing and
hearing schedule and that process may take several months to complete. Based on the Court of Appeals' briefing
schedule, the respondent is required to submit a reply brief by October 17, 2003. Then, the appellants will answer the
respondent's reply brief by November 7, 2003. The Court of Appeals has scheduled a hearing on December 16, 2003. If
the Judge's decision is upheld on appeal, it could have financial ramifications throughout the State of California. The
City's management is unable to reasonably estimate the financial effect to it, or the Redevelopment Agency, if the Orange
County Superior Court's decision is upheld, because it would be dependent upon how the court's decides to apply its
ruling.
State of California Budget Crisis
The State of California is facing significant deficits due to a number of factors, not the least of which include a slowdown
in the State's economy and the effects of unfavorable long-term contracts entered into during the energy crisis of 2002.
Current estimates of the State's budget shortfall for fiscal year 2004 range up to $39 billion. Since a significant portion of
local government revenues come from the State through allocations to local governments, the current budget crisis in
California could have a direct significant financial impact on all local governments, including the City of Carlsbad. As the
revenues are allocated to a variety of local governments, the City's management is not able to predict what the ultimate
impact the State's budget shortfall will have on the City's financial position.
81
82
SUPPLEMENTARY INFORMATION
83
CITY OF CARLSBAD
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2003
ASSETS
Community
Affordable Development Donations Federal
Housing Block Grant and Bequests Grants
Low and
Moderate
Gas Income
Tax Housing
Cash and investments
Receivables:
Taxes
Other
Accounts, net
Due from other governments
Prepaid items
Restricted cash and investments
Loan receivables
Advances to other funds
Total assets
LIABILITIES AND FUND BALANCES
7,666,369 $ 14,251 $8,914,740 $ 72,873 $ 4,729,384 $1,826,092
36,616
6,989,107
225
10,258
5,568
6,575
44
2,290,024
4,643,344
$ 14,692,092 $ 30,077 $8,914,965 $ 72,873 S 9,372,728 $4,122,735
Liabilities:
Accrued liabilities
Due to other funds
Deposits payable
Due to to other governments
Advances from other funds
Deferred revenue
Total liabilities
Fund balances:
Reserved for:
Loans receivable
Prepaid items
Debt service
Advances to other funds
Flower fields preservation
Library endowment
Low and moderate income housing
Encumbrances
Unreserved:
Designated for approved capital projects
Designated for continuing appropriations
Undesignated
Total fund balances
Total liabilities and fund balances
21,631 19,031 45,535 5,613
165,277
5,478
90,560 3,069
186,908 24,509 45,535 5,613 90,560 3,069
6,989,107 5,568 2,290,024
4,643,344
935,000
251,000
3,284,650
23,856
4,207,571
14,505,184
7,769
(7,769)
5,568
13,086
166,470
7,503,874
8,869,430
3,777
61,768
1,715
67,260
644,082
2,457,719
1,537,023
9,282,168
1,465
115,987
1,712,190
4,119,666
14,692,092 $ 30,077 $8,914,965 $ 72,873 $ 9,372,728 $4,122,735
84
Special Revenue Funds
Other
Special Police Sections Special Storm Tyler
Revenue Asset Housing Benefit State Water Court
Funds Forfeiture Authority Districts Grants Program Apartments
$ 254,878 $595,109 $ 6,422 $2,963,052 $ 316,905 $ 216,374 $ 539,200
9,469
458 36,370 15,000
656,863
343,247
$ 254,878 $595,109 $ 1,006,532 $2,972,979 $ 353,275 $ 231,374 $ 539,200
1,002 470 29,176 168,578 14,035 117,696
502,000 ....
60,855 - - - 20,502
51,875
1,076,419
1,002 470 592,031 168,578 65,910 1,194,115 20,502
343,247
10,425 10,884 158,710 19,982 113,655
17,569 102,794
225,882 491,845
1,026,522 207,419
60,370 1,619,169 59,964 (1,076,396) 518,698
253,876 594,639 414,501 2,804,401 287,365 (962,741) 518,698
254,878 $595,109 $ 1,006,532 $2,972,979 $ 353,275 $ 231,374 $ 539,200
(Continued)
85
CITY OF CARLSBAD
Combining Balance Sheet
Nonmajor Governmental Funds (Continued)
June 30, 2003
ASSETS
Debt Service
Fund
Hosp Grove
COPs
Assessment
and Other
Districts
Federal
Grants
Infrastructure
Replacement
Other
Capital
Project
Funds
Cash and investments
Receivables:
Taxes
Other
Accounts, net
Due from other governments
Prepaid items
Restricted cash and investments
Loan receivables
Advances to other funds
Total assets
LIABILITIES AND FUND BALANCES
$ 565,341 $2,926,979 $$11,636,869 $ 335,592
118,773
685,284
$1,250,625 $2,926,979 $ 118,773 $11,636,869 $ 335,592
Liabilities:
Accrued liabilities
Due to other funds
Deposits payable
Due to to other governments
Advances from other funds
Deferred revenue
Total liabilities
Fund balances:
Reserved for:
Loans receivable
Prepaid items
Debt service
Advances to other funds
Flower fields preservation
Library endowment
Low and moderate income housing
Encumbrances
Unreserved:
Designated for approved capital projects
Designated for continuing appropriations
Undesignated
Total fund balances
Total liabilities and fund balances
659,500
591,125
1,250,625
21,193
990,854
51,186
67,182
506,708 591
1,342
1,012,047 118,368 506,708 1,933
162,536
607,077
1,145,319
298,136 218,185
456,005
(297,731) 10,455,971
11,153
9,340
313,166
1,914,932 405 11,130,161 333,659
$1,250,625 $2,926,979 $ 118,773 $11,636,869 $ 335,592
86
Capital Project Funds
Park
Development
$6,031,908
_
-
-
-
-
-
-
-
$6,031,908
Planned
Local
Drainage
Facilities
$8,155,552
_
-
181,474
-
-
-
-
-
$8,337,026
Rancho
Santa Fe
Road
Project
$ 25,884,525
_
-
-
2,041,333
-
-
-
-
$27,925,858
Redevelopment
Agency
$ 867,555
_
3,956
2,685
-
-
-
-
-
$ 874,196
Sales Tax/
TransNet
$10,672,531
_
-
-
-
-
-
-
-
$ 10,672,531
State
Grants
$ 513,744
_
-
-
219,809
-
-
-
-
$ 733,553
Traffic
Impact
Projects
$7,684,977
_
-
-
-
-
-
-
-
$7,684,977
Total Other
Governmental
Funds
$ 103,391,222
16,044
4,000
272,828
3,047,036
343,247
685,284
9,284,699
4,643,344
$ 121,687,704
3,082
-
-
-
3,980,000
-
3,983,082
-
-
-
-
-
-
21,275
676,089
1,351,462
-
2,048,826
3,920
-
-
-
-
181,474
185,394
-
-
-
-
-
-
64,892
2,383,439
5,703,301
-
8,151,632
818,104
-
-
-
-
-
818,104
-
-
-
-
-
-
12,345,173
8,467,052
6,295,529
-
27,107,754
37,144
-
-
-
-
-
37,144
-
-
-
-
-
-
178,684
_
658,368
-
837,052
69,761
-
-
-
-
-
69,761
-
-
-
-
-
-
479,908
591,582
9,531,280
-
10,602,770
89,867
-
-
10,200
-
-
100,067
-
-
-
-
-
-
141
509,596
67,842
55,907
633,486
2,490
-
-
-
-
-
2,490
-
-
-
-
-
-
154,937
6,063,077
1,464,473
-
7,682,487
2,120,442
570,524
246,634
67,553
6,047,273
181,474
9,233,900
9,284,699
343,247
659,500
4,643,344
935,000
251,000
3,284,650
14,942,711
21,755,631
28,381,448
27,972,574
112,453,804
$6,031,908 $8,337,026 $27,925,858 $ 874,196 $10,672,531 $ 733,553 $7,684,977 $ 121,687,704
87
CITY OF CARLSBAD
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended June 30, 2003
Affordable
Housing
Community
Development
Block Grant
Donations
and Bequests
Federal
Grants
Gas
Tax
Low and
Moderate
Income
Housing
Revenues:
Taxes
Intergovernmental
Charges for services
Fines and forfeitures
Income from property and investments
Interdepartmental charges
Contributions from property owners
Donations
Miscellaneous
Total revenues
Expenditures:
Current:
General government
Public safety
Community development
Community services
Public works
Capital outlay
Debt service:
Principal retirement
Interest and fiscal charges
Total expenditures
Excess (deficiency) of revenues
over expenditures
Other financing sources (uses):
Transfers in
Transfers out
Total other financing sources (uses)
Net change in fund balances
Fund balances (deficits) at beginning of year
Fund balances (deficits) at end of year
204,962
494
791,094
$ - $ 1,643,800 $ 442,280
51,354 12,000
113,539
960,882
624,180
23,175
1,721,776
-
32,906
-
824,000
-
394,880 3,801
621,633
148,844
190
1,165,547 55,155
-
195,317
-
1,851,117
-
140,349
-
582,629
225,291
401,036
81,275
347,415
12,188 30,123 2,889,494
75,798
47,216
1,370 160,000
664 20,651
207,490 806,978 359,603
1,514,286 17,022 805,944
25,000
(5,000)
20,000
-
111,398
(56,243)
5,706
(3,773)
1,933
;
2,889,494
(1,038,377)
14,763
(8,752)
6,011
761
369
124,144
458,485
-
1,514,286 17,022 825,944 (54,310) (1,032,366) 458,485
12,990,898 (11,454) 8,043,486 121,570 10,314,534 3,661,181
$14.505.184 $ 5.568 $8.869,430 $ 67.260 $ 9,282,168 $4,119,666
88
Special Revenue Funds
Other
Special Police
Revenue Asset
Funds Forfeiture
$ - $ -
-
-
62,376
11,707 27,000
-
11,707 89,376
60,162
-
29,109
-
18,048
_
-
29,109 78,210
(17,402) 11,166
(5,706)
(5,706)
(17,402) 5,460
271,278 589,179
$ 253,876 $ 594,639
Section 8
Housing
Authority
$
5,084,652
-
-
2,659
-
5,087,311
-
5,012,255
-
-
1,531
3,576
1,735
5,019,097
68,214
68,214
346,287
$ 414,501
Special
Benefit
Districts
$
-
1,851,534
-
127,021
128,590
2,107,145
-
-
-
2,234,302
-
_
-
2,234,302
(127,157)
(127,157)
2,931,558
$2,804,401
State
Grants
$
338,726
-
-
11,588
-
350,314
183,352
-
73,858
-
76,245
_
-
333,455
16,859
(825)
(825)
16,034
271,331
$ 287,365
Storm
Water
Program
$
25,000
-
-
83,872
-
108,872
-
-
-
1,093,633
9,974
_
-
1,103,607
(994,735)
(1,190,300)
(1,190,300)
(2,185,035)
1,222,294
$ (962,741)
Tyler
Court
Apartments
$
384,248
-
19,447
.
403,695
-
246,560
-
-
-
_
-
246,560
157,135
157,135
361,563
$ 518,698
(Continued)
89
CITY OF CARLSBAD
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
Nonmajor Governmental Funds (Continued)
For the Year Ended June 30, 2003
Revenues:
Taxes
Intergovernmental
Charges for services
Fines and forfeitures
Income from property and investments
Interdepartmental charges
Contributions from property owners
Donations
Miscellaneous
Total revenues
Debt Service
Fund
Assessment
Hosp Grove and Other
COPs Districts
$ - $ -
-
-
-
62,661 133,687
-
1,011,859
-
325
62,661 1,145,871
Federal
Grants
$
208,467
-
-
448
-
-
-
-
208,915
Infrastructure
Replacement
$ 8,472
-
-
-
606,458
-
-
-
-
614,930
Other
Capital
Project Park
Funds Development
$ $
-
-
-
14,244 271,779
-
2,044,903
-
-
14,244 2,316,682
Expenditures:
Current:
General government
Public safety
Community development
Community services
Public works
Capital outlay
Debt service:
Principal retirement
Interest and fiscal charges
Total expenditures
Excess (deficiency) of revenues
over expenditures
Other financing sources (Uses):
Transfers in
Transfers out
Total other financing sources (uses)
Net change in fund balances
Fund balances at beginning of year
Fund balances at end of year
565,000
225,558
33,220
398,709 208,510 1,290,712 133,126 4,821,151
790,558 431,929 208,510 1,290,712 133,126 4,821,151
(727,897) 713,942 405 (675,782) (118,882) (2,504,469)
800,000
800,000
149,296
(184,783)
(35,487)
3,500,000
3,500,000
(698,243)
(698,243)
;
.
72,103 678,455
1,178,522 1,236,477
405 2,824,218 (817,125) (2,504,469)
8,305,943 1,150,784 4,553,295
$1,250,625 $1,914,932 $ 405 $11,130,161 $ 333.659 $2,048,826
90
Capital Project Funds
Planned
Local
Drainage
Facilities
$
-
-
-
356,621
-
378,752
-
4,432
739,805
-
-
-
-
574,219
.
-
574,219
165,586
-
165,586
7,986,046
$8,151,632
Rancho
Santa Fe
Road
Project
$
2,041,333
-
-
1,157,847
-
3,650,230
-
1,371,331
8,220,741
-
-
-
-
6,849,077
_
-
6,849,077
1,371,664
5,829,276
-
5,829,276
7,200,940
19,906,814
$27,107,754
Redevelopment
Agency
$
268,649
-
-
27,397
-
5,257
-
-
301,303
503,892
-
-
-
-
322,343
1,903
922
829,060
(527,757)
282,000
-
282,000
(245,757)
1,082,809
$ 837,052
Sales Tax/
TransNet
$
3,559,996
-
-
446,197
-
-
-
-
4,006,193
-
-
-
-
1,676,904
_
-
1,676,904
2,329,289
206,928
(38,696)
168,232
2,497,521
8,105,249
$10,602,770
State
Grants
$
524,105
-
-
23,600
-
-
-
-
547,705
10,200
-
-
-
-
242,031
.
-
252,231
295,474
(381,068)
(381,068)
(85,594)
719,080
$ 633,486
Traffic
Impact
Projects
$
-
-
-
340,785
-
1,371,210
-
-
1,711,995
-
-
-
-
402,011
_
-
402,011
1,309,984
37,207
-
37,207
1,347,191
6,335,296
$7,682,487
Total Other
Governmental
Funds
$ 2,094,552
12,905,376
2,349,321
62,376
5,453,153
128,590
9,708,024
148,844
1,399,453
34,249,689
547,312
324,789
5,764,866
450,382
3,327,935
20,405,142
732,610
249,899
31,802,935
2,446,754
10,850,176
(2,517,146)
8,333,030
10,779,784
101,674,020
$ 112,453,804
91
CITY OF CARLSBAD
Combining Schedule of Revenues and Expenditures
Budget and Actual (Budgetary Basis)
Special Revenue Funds
Year Ended June 30, 2003
Affordable Housing
Total revenues
Total expenditures
Net change in fund balance
Community Dev Block Grant
Total revenues
Total expenditures
Net change in fund balance
Donations and Bequests
Total revenues
Total expenditures
Net change in fund balance
Federal Grants
Total revenues
Total expenditures
Net change in fund balance
Gas Tax
Total revenues
Total expenditures
Net change in fund balance
Low & Moderate Income Housing
Total revenues
Total expenditures
Net change in fund balance
Other Special Revenue Funds
Total revenues
Total expenditures
Net change in fund balance
Budget
$ 810,000
329,136
480,864
770,000
1,599,044
(829,044)
250,835
560,367
(309,532)
65,170
178,726
(113,556)
1,550,000
5,991,295
(4,441,295)
493,500
241,596
251,904
25,000
57,103
(32,103)
Actual
Amounts
(Budgetary
Basis)
$ 1,721,776
231,346
1,490,430
824,000
814,747
9,253
1,165,547
372,689
792,858
55,155
115,175
(60,020)
1,851,117
3,533,576
(1,682,459)
582,629
125,609
457,020
11,707
39,534
(27,827)
Variance
Over
(Under)
$ 911,776
(97,790)
1,009,566
54,000
(784,297)
838,297
914,712
(187,678)
1,102,390
(10,015)
(63,551)
53,536
301,117
(2,457,719)
2,758,836
89,129
(115,987)
205,116
(13,293)
(17,569)
4,276
92
CITY OF CARLSBAD
Combining Schedule of Revenues and Expenditures
Budget and Actual (Budgetary Basis)
Special Revenue Funds (Continued)
Year Ended June 30, 2003
Actual Amounts
(Budgetary
Budget Basis)
Police Asset Forfeiture
Total revenues
Total expenditures
Net change in fund balance
Section 8 Housing Authority
Total revenues
Total expenditures
Net change in fund balance
Special Benefit Districts
Total revenues
Total expenditures
Net change in fund balance
State Grants
Total revenues
Total expenditures
Net change in fund balance
Storm Water Program
Total revenues
Total expenditures
Net change in fund balance
Tyler Court Apartments
Total revenues
Total expenditures
Net change in fund balance
Totals
Total revenues
Total expenditures
Net change in fund balance
55,000
181,004
(126,004)
5,324,822
5,352,016
(27,194)
2,185,387
3,419,534
(1,234,147)
201,984
560,857
(358,873)
50,000
1,480,410
(1,430,410)
364,847
247,791
117,056
12,146,545
20,198,879
$ (8,052,334) $
89,376
78,210
11,166
5,087,311
5,029,981
57,330
2,107,145
2,393,012
(285,867)
350,314
353,437
(3,123)
108,872
1,217,262
(1,108,390)
403,695
246,560
157,135
14,358,644
14,551,138
; {192,494} $
Variance
Over
(Under)
34,376
(102,794)
137,170
(237,511)
(322,035)
84,524
(78,242)
(1,026,522)
948,280
148,330
(207,420)
355,750
58,872
(263,148)
322,020
38,848
(1,231)
40,079
2,212,099
(5,647,741)
7,859,840
93
CITY OF CARLSBAD
Combining Schedule of Revenues and Expenditures
Budget and Actual (Budgetary Basis)
Debt Service Funds
Year Ended June 30,2003
Redevelopment Areas
Total revenues
Total expenditures
Net change in fund balance
Budget
$ 2,035,800
1,705,806
$ 329,994
Actual
Amounts
(Budgetary
Basis)
$ 1,811,948 $
1,679,301
$ 132,647 $
Variance
Over
(Under)
(223,852)
(26,505)
(197,347)
94
95
CITY OF CARLSBAD
Combining Statement of Net Assets
Internal Service Funds
June 30,2003
ASSETS
Current assets:
Cash and investments
Receivables:
Accounts, net
Inventory
Prepaid items
Total current assets
Noncurrent assets:
Capital assets:
Machinery and equipment
Less accumulated depreciation
Total capital assets (net of accumulated
depreciation)
Total noncurrent assets
Total assets
LIABILITIES
Current liabilities:
Accrued liabilities
Estimated claims payable
Current portion of long-term debt
Total current liabilities
Noncurrent liabilities:
Capital leases payable
Total noncurrent liabilities
Total liabilities
NET ASSETS
Invested in capital assets, net of related debt
Unrestricted
Fleet
Management
$ 7,030,267
32,390
96,556
-
7,159,213
11,846,896
(6,168,126)
5,678,770
5,678,770
12,837,983
416,329
-
2,981
419,310
1,580
1,580
420,890
5,674,209
6,742,884
Health Information
Insurance Technology
$ 1,091,085 $ 3,176,816
-
-
752 54,801
1,091,837 3,231,617
2,936,054
(2,098,903)
837,151
837,151
1,091,837 4,068,768
7,060 211,624
300,949
3,236
308,009 214,860
1,732
1,732
308,009 216,592
832,183
783,828 3,019,993
Total net assets $ 12,417,093 $783,828 $ 3,852,176
96
Records
Management
$ 140,881
140,881
57,769
(31,254)
26,515
26,515
167,396
Risk Workers'
Management Compensation Total
$ 2,083,881 $ 1,217,750 $ 14,740,680
32,390
96,556
76,728 - 132,281
2,160,609 1,217,750 15,001,907
14,840,719
(8,298,283)
6,542,436
6,542,436
2,160,609 1,217,750 21,544,343
49,688
49,688
61,382 6,240 752,323
704,403 2,010,491 3,015,843
6,217
765,785 2,016,731 3,774,383
3,312
3,312
49,688 765,785 2,016,731 3,777,695
26,515
91,193
$ 117,708
6,532,907
1,394,824 (798,981) 11,233,741
$ 1,394,824 $ (798,981) $ 17,766,648
97
CITY OF CARLSBAD
Combining Statement of Revenues, Expenses and Changes in Net Assets
Internal Service Funds
For the Year Ended June 30,2003
Operating revenues:
Other charges for services
Miscellaneous
Total operating revenues
Operating expenses:
Depreciation
Fuel and supplies
Claims expense
General and administrative
Total operating expenses
Operating income (loss)
Nonoperating revenues (expenses):
Income from property and investments
Gain (loss) on sale of property
Total nonoperating revenues (expenses)
Income (loss) before transfers and
capital contributions
Transfers in
Transfers out
Capital contributions
Change in net assets
Total net assets at beginning of year
Total net assets at end of year
Fleet Health
Management Insurance
S 2,896,560 $ 2,994,636 !
100,569
2,997,129 2,994,636
1,147,960
471,773
2,674,714
1,150,109
2,769,842 2,674,714
227,287 319,922
313,154 49,365
22,808
335,962 49,365
563,249 369,287
-
-
99,353
662,602 369,287
11,754,491 414,541
$ 12,417,093 $ 783,828 !
Information
Technology
5 3,896,817
569
3,897,386
524,367
-
-
3,539,115
4,063,482
(166,096)
139,208
(19,404)
119,804
(46,292)
21,512
-
22,967
(1,813)
3,853,989
S 3,852,176
98
Records
Management
$ 1,030,400
612
1,031,012
10,997
-
-
894,875
905,872
125,140
25
-
25
125,165
-
.
125,165
(7,457)
$ 117,708
Risk
Management
$ 603,009
34,214
637,223
-
1,014,100
317,805
1,331,905
(694,682)
99,833
-
99,833
(594,849)
113,305
-
(481,544)
1,876,368
$ 1,394,824
Workers'
Compensation
$ 600,231 !
16,276
616,507
-
1,977,110
147,272
2,124,382
(1,507,875)
56,154
-
56,154
(1,451,721)
-
.
(1,451,721)
652,740
$ (798,981) !
Totals
S 12,021,653
152,240
12,173,893
1,683,324
471,773
5,665,924
6,049,176
13,870,197
(1,696,304)
657,739
3,404
661,143
(1,035,161)
134,817
122,320
(778,024)
18,544,672
5 17,766,648
99
CITY OF CARLSBAD
Combining Statement of Cash Flows
Internal Service Funds
For the Year Ended June 30,2003
Cash flows from operating activities:
Receipts from customers and users
Payments to suppliers
Payments to employees
Internal activity - payments to other funds
Claims paid
Other receipts (payments)
Net cash provided by (used in) operating activities
Cash flows from noncapital financing activities:
Operating subsidies and transfers to other funds
Cash flows from capital and related financing activities:
(Purchases) sales of capital assets
Principal paid on capital debt
Net cash provided by (used in) capital and related
financing activities
Cash flows from investing activities:
Interest on investments
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Fleet
Management
$ 2,896,560
(814,947)
(523,519)
(253,338)
-
90,651
1,395,407
Health Information
Insurance Technology
$ 2,995,250 $ 3,896,817
(1,751,859)
(1,418,761)
(346,832)
(2,677,632)
569
317,618 379,934
21,512
(746,255)
(2,759)
(749,014)
313,155
959,548
6,070,719
(179,183)
(2,952)
(182,135)
49,365 139,208
366,983 358,519
724,102 2,818,297
$ 7,030,267 $ 1,091,085 $ 3,176,816
100
Records
Management
$ 1,030,400
(172,126)
(503,445)
(224,243)
612
131,198
(101,482)
111,140
111,140
25
140,881
$ 140,881
Risk
Management
$ 603,009
(161,274)
(154,238)
(1,375,275)
34,214
(1,053,564)
113,305
1,035
1,035
99,832
(839,392)
2,923,273
$ 2,083,881
Workers'
Compensation
$ 600,231 $
(84,113)
(63,583)
(1,125,590)
16,276
(656,779)
-
56,154
(600,625)
1,818,375
$ 1,217,750 $
Total
12,022,267
(2,738,932)
(2,691,112)
(1,042,234)
(5,178,497)
142,322
513,814
33,335
(813,263)
(5,711)
(818,974)
657,739
385,914
14,354,766
14,740,680
(Continued)
101
CITY OF CARLSBAD
Combining Statement of Cash Flows
Internal Service Funds (Continued)
For the Year Ended June 30, 2003
Fleet
Management
Reconciliation of operating income (loss) to net cash
provided by (used in) operating activities:
Operating income (loss)
Adjustments to reconcile operating income to net cash
provided by operting activities:
Depreciation and amortization
Change in assets and liabilities:
(Increase) decrease in receivables
(Increase) decrease in inventory
(Increase) decrease in prepaid items
Increase (decrease) in accrued liabilities
Increase (decrease) in estimated claims payable
Net cash provided by (used in) operating activities
Noncash capital financing activities:
Capital assets contributed by other funds
1,147,960
(9,918)
(10,741)
40,819
Health
Insurance
Information
Technology
$ 227,287 $ 319,922 $ (166,096)
524,367
614
57,934
(37,460)
(23,392)
(42,686)
64,349
$ 1,395,407 $ 317,618 $ 379,934
$ 84,201 $$ 3,563
102
Records Risk Workers'
Management Management Compensation Total
$ 125,140 $ (694,682) $ (1,507,875) $ (1,696,304)
10,997 1,683,324
-
-
-
(4,939)
-
$ 131,198 $
-
-
(76,728)
2,292
(284,446)
(1,053,564) $
-
-
-
(425)
851,521
(656,779) $
(9,304)
(10,741)
(61,480)
64,636
543,683
513,814
$ 87,764
103
CITY OF CARLSBAD
Combining Statement of Net Assets
Fiduciary Funds
June 30, 2003
ASSETS
Current Assets:
Cash and investments
Taxes receivable
Accrued interest
Total current assets
Restricted Assets:
Cash and investments
Total assets
LIABILITIES
Accounts payable
Total liabilities
Contractors' and
Miscellaneous
Deposits
$ 12,088,228
-
-
12,088,228
-
$ 12,088,228
22,051
22,051
Assessment
Districts
$ 3,179,074
29,766
83,592
3,292,432
4,017,696
$ 7,310,128
2,811
2,811
Total
Agency
Funds
$ 15,267,302
29,766
83,592
15,380,660
4,017,696
$ 19,398,356
24,862
24,862
NET ASSETS
Held in trust for contractors, bondholders and other purposes 12,066,177 $7,307,317 S 19,373,494
104
CITY OF CARLSBAD
Combining Statement of Changes in Net Assets
Fiduciary Funds
June 30, 2003
ADDITIONS
Contributions from property owners and developer deposits
Payroll related deposits
Interest income
Other miscellaneous additions
Total additions
DEDUCTIONS
Administrative expenses
Refunds of developer deposits
Payroll related deposits
Payments to bondholders
Other miscellaneous deductions
Total deductions
Change in net assets
Net assets - beginning
Net assets - ending
Contractors' and
Miscellaneous
Deposits
$ 4,878,742
20,383,761
559,881
9,108
25,831,492
5,411
1,310,694
20,713,376
157,505
22,186,986
3,644,506
8,421,671
$ 12,066,177
Assessment
Districts
$ 4,230,362 $
356,009
4,586,371
96,513
4,929,769
31,550
5,057,832
(471,461)
7,778,778
$ 7,307,317 $
Total
Agency
Funds
9,109,104
20,383,761
915,890
9,108
30,417,863
101,924
1,310,694
20,713,376
4,929,769
189,055
27,244,818
3,173,045
16,200,449
19,373,494
105
CITY OF CARLSBAD
Schedule of Annual Debt Service Requirements
$15,495,000 -1993 Carlsbad Housing and
Redevelopment Commission Tax Allocation Bonds
Fiscal Year
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-10
2010-11
2011-12
2012-13
2013-14
2014-15
2015-16
2016-17
2017-18
2018-19
2019-20
2020-21
2021-22
2022-23
2023-24
Totals
Interest Due
September 1
$ 347,426
337,976
328,001
317,633
306,607
295,058
282,851
269,989
256,470
242,295
227,332
211,583
195,045
177,589
159,214
139,920
119,576
98,182
75,525
51,675
26,500
$ 4,466,447
Interest Due
March 1
$ 337,977
328,001
317,633
306,607
295,058
282,851
269,989
256,470
242,295
227,332
211,583
195,045
177,589
159,213
139,920
119,576
98,183
75,525
51,675
26,500
-
$ 4,119,022
Total
Interest
$ 685,403
665,977
645,634
624,240
601,665
577,909
552,840
526,459
498,765
469,627
438,915
406,628
372,634
336,802
299,134
259,496
217,759
173,707
127,200
78,175
26,500
$ 8,585,469
Principal Due
September 1
$ 360,000
380,000
395,000
420,000
440,000
465,000
490,000
515,000
540,000
570,000
600,000
630,000
665,000
700,000
735,000
775,000
815,000
855,000
900,000
950,000
1,000,000
$ 13,200,000
Total Annual
Debt Service
$ 1,045,403
,045,977
,040,634
,044,240
,041,665
,042,909
,042,840
,041,459
1,038,765
1,039,627
1,038,915
1,036,628
1,037,634
1,036,802
1,034,134
1,034,496
1,032,759
1,028,707
1,027,200
1,028,175
1,026,500
$ 21,785,469
106
CITY OF CARLSBAD
Schedule of Annual Debt Service Requirements (Continued)
$6,595,000 - 1997 Hosp Grove Certificates of Participation
(1988 Refunding)
Fiscal Year
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
Totals
$1,199,950 - HUD Section
Fiscal Year
2003-04
Totals
Interest Due
August 1
$ 88,743
76,058
62,418
48,448
33,373
17,273
$ 326,313
108 Loan
Interest Due
August 1
$ 7,030
$ 7,030
Interest Due
February 1
$ 76,057
62,417
48,447
33,372
17,272
$ 237,565
Interest Due
February 1
$
$
Total
Interest
$ 164,800
138,475
110,865
81,820
50,645
17,273
$ 563,878
Total
Interest
$ 7,030
$ 7,030
Principal Due
August 1
$ 590,000
620,000
635,000
670,000
700,000
735,000
$ 3,950,000
Principal Due
August 1
$ 169,950
$ 169,950
Total Annual
Debt Service
$ 754,800
758,475
745,865
751,820
750,645
752,273
$ 4,513,878
Total Annual
Debt Service
$ 176,980
$ 176,980
107
CITY OF CARLSBAD
Schedule of Annual Debt Service Requirements (Continued)
$7,400,000 - 1997 Carlsbad Municipal Water District
Certificates of Participation (1988 Refunding Project)
2003-04
Totals
Interest Due
Fiscal Year November 1
S 25,850
$ 25,850
Interest Due
Mayl
$ 25,850
$ 25,850
Total
Interest
$ 51,700
$ 51,700
Principal Due
May 1
$ 1,175,000
$ 1,175,000
Total Annual
Debt Service
$ 1,226,700
$ 1,226,700
$11,080,000 - Encina Financing Joint Powers Authority
Installment Purchase Agreement
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-10
2010-11
2011-12
2012-13
2013-14
2014-15
Totals
Interest Due
Fiscal Year August 1
$ 215,278
200,978
188,603
172,791
156,153
139,353
122,816
105,191
86,228
66,241
45,228
23,190
$ 1,522,050
Interest Due
February 1
$ 200,978
188,603
172,791
156,153
139,353
122,816
105,191
86,228
66,241
45,228
23,191
-
$ 1,306,773
Total
Interest
$ 416,256
389,581
361,394
328,944
295,506
262,169
228,007
191,419
152,469
111,469
68,419
23,190
$ 2,828,823
Principal Due
August 1
$ 520,000
550,000
575,000
605,000
640,000
675,000
705,000
740,000
780,000
820,000
860,000
905,000
$ 8,375,000
Total Annual
Debt Service
$ 936,256
939,581
936,394
933,944
935,506
937,169
933,007
931,419
932,469
931,469
928,419
928,190
$ 11,203,823
108
CITY OF CARLSBAD
Schedule of Annual Debt Service Requirements (Continued)
$2^31,489 - Carlsbad Municipal Water District
State Loan for Reclaimed Water Projects
Fiscal Year
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-10
2010-11
2011-12
2012-13
2013-14
Totals
$2,618,908 - Golf Course Accrued Assessment
Fiscal Year
2003-04
2004-05
2005-06
Interest Due
November 30
$ 42,350
38,952
35,455
31,857
28,155
24,345
20,425
16,391
12,240
7,969
2,680
$ 260,819
Interest
$ 29,103
20,173
10,425
Principal Due
November 30
$ 117,177
120,575
124,072
127,670
131,372
135,182
139,102
143,136
147,287
151,558
123,219
$ 1,460,350
Principal
$ 186,060
196,925
60,128
Total Annual
Debt Service
$ 159,527
159,527
159,527
159,527
159,527
159,527
159,527
159,527
159,527
159,527
125,899
$ 1,721,169
Total Annual
Debt Service
$ 215,163
217,098
70,553
Totals 59,701 $ 443,113 $ 502,814
109
no
I
S
111
CITY OF CARLSBAD
Government-wide Expenses by Function
Fiscal
Year
2001-02(1)
2002-03
General
Government
$7,599,821
8,517,581
Public
Safety
$25,659,586
27,747,646
Community
Development
$10,539,139
12,351,779
Community
Services
$13,269,566
14,190,510
Public
Works
$15,015,344
16,825,872
Interest on
Long-Term
Debt
$1,673,516
1,048,264
(I)The City first began issuing Government-wide statements in fiscal year 2001-2002.
GOVERNMENT-WIDE EXPENSES BY FUNCTION
2002-2003
Carlsbad Municipal
Water District
18%
Interest on Long-
Term Debt
1%
Public Works
16%
Sewer
6%General Government
8%
Community
Services
13%
Public Safety
26%
Community
Development
12%
Source: City of Carlsbad Comprehensive Annual Financial Reports
112
Carlsbad
Municipal
Water Golf Solid
District Course Sewer Waste Total
$19,310,792 $98,565 $6,168,690 $212,605 $99,547,624
19,261,199 93,341 6,103,668 218,014 106,357,874
113
CITY OF CARLSBAD
Government-wide Revenues
PROGRAM REVENUES
Fiscal
Year
2001-02(l)
2002-03
Charges for
Services
$40,142,313
42,464,001
Operating Grants
and
Contributions
$8,562,412
11,406,166
Capital Grants
and
Contributions
$43,007,215
64,719,339
(l)The City first began issuing Government-wide statements in fiscal year 2001-2002.
GOVERNMENT-WIDE REVENUES BY FUNCTION
2002-2003
Vehicle License
Fees
2%
Income from
Property and
Investments
9%
Charges for
Services
20%
Operating
Grants and
Contributions
5%
Capital Grants
and
Contributions
29%
Source: City of Carlsbad Comprehensive Annual Financial Reports
114
GENERAL REVENUES
Vehicle Income from
License Property and
Taxes Fees Investments Miscellaneous Total
$70,676,433 $4,675,269 $25,105,269 $1,564,886 $193,733,797
74,398,635 5,066,902 19,182,978 598,688 217,836,709
115
CITY OF CARLSBAD
General Governmental Expenditures by Function'1'
Last Ten Fiscal Years
Fiscal
Year(2)
1993-94
1994-95
1995-96
1996-97
1997-98
1998-99
1999-00
2000-01
2001-02
2002-03
Total
$ 62,668,276
60,280,103
59,802,924
65,943,032
80,045,280
112,156,205
105,655,384
92,884,485
112,513,403
108,662,936
General
Government
$5,513,101
5,871,248
5,850,829
6,961,469
6,909,151
6,784,525
7,382,909
9,022,218
8,414,743
8,805,313
Public
Safety
$ 16,351,652
15,915,678
16,850,087
17,410,033
18,631,042
21,927,751
21,799,386
23,627,184
25,598,466
26,797,864
Community
Development
$ 6,255,252
6,465,977
7,363,194
7,431,539
7,894,536
8,636,634
11,538,444
9,351,917
10,315,783
12,146,247
(1)
(2)
Includes General, Special Revenue, Debt Service, and Capital Projects Funds.
Beginning in fiscal year 1997-98, Park Maintenance expenditures are included in Public Works instead of Community Services.
GENERAL GOVERNMENTAL EXPENDITURES
BY FUNCTION
2002-2003
Capital Projects
24%
Debt Service
3%General
Government
8%
Public Works
17%
Community
Services
12%
Source: City of Carlsbad Comprehensive Annual Financial Reports
Public Safety
25%
Community
Development
11%
116
Community
Services
$7,548,100
7,459,685
7,590,363
8,390,009
6,672,810
7,541,378
9,088,264
11,571,249
12,448,725
13,026,341
Public
Works
$ 8,847,328
8,111,572
8,956,757
8,816,767
11,437,101
12,689,683
13,822,429
14,402,096
15,404,566
18,176,697
Capital
Outlay
$12,933,253
12,159,653
9,654,082
13,556,164
23,693,412
52,106,587
39,543,074
22,066,731
37,503,175
26,410,483
Debt
Service
$5,219,590
4,296,290
3,537,612
3,377,051
4,807,228
2,469,647
2,480,878
2,843,090
2,827,945
3,299,991
SPENDING ON CAPITAL PROJECTS
LAST TEN YEARS
TOTAL EXPENDITURES
LAST TEN YEARS
$o $0
Fiscal Year Fiscal Year
117
CITY OF CARLSBAD
General Governmental Revenues by Source01
Last Ten Fiscal Years
Fiscal
Year
1993-94
1994-95
1995-96
1996-97
1997-98
1998-99
1999-00
2000-01
2001-02
2002-03
Total(2)
$62,239,740
69,768,517
74,611,395
98,645,130
122,653,159
145,393,991
115,252,270
136,244,948
131,323,111
141,617,437
Property
Taxes
$13,920,220
13,537,893
13,576,407
14,516,474
15,226,827
17,121,586
19,916,613
23,143,014
28,495,155
31,410,575
Sales
Taxes
$10,840,115
11,399,568
11,542,970
12,495,143
14,817,057
17,129,474
19,493,247
21,196,726
21,660,902
25,542,844
Transient
Occupancy
Taxes
$3,153,084
3,252,270
3,406,917
3,675,472
6,046,092
7,010,249
8,333,196
9,269,484
8,533,329
8,387,388
Business
Licenses
$1,093,827
1,245,830
1,491,159
1,510,462
1,603,744
1,737,850
1,863,514
2,300,367
2,440,387
2,305,178
Other
Taxes
$4,124,250
8,434,825
8,621,717
10,824,890
15,290,601
14,508,643
12,661,882
14,237,832
10,398,486
6,510,259
Includes General, Special Revenue, Debt Service, and Capital Projects Funds.
(2) Includes interdepartmental services category added in 1991-1992, donations, and miscellaneous revenues.
GENERAL GOVERNMENTAL REVENUE
LAST TEN YEARS
PROPERTY TAX
AND SALES TAX REVENUE
LAST TEN YEARS
160
140 •
V)
ol20-\
Fiscal Year
Source: City of Carlsbad Comprehensive Annual Financial Reports
Fiscal Year
In Property Tax • Sales Tax
118
Inter-
Governmental
$ 8,019,308
7,590,323
6,426,262
11,764,760
17,091,140
17,801,614
14,094,118
14,285,677
14,266,527
19,775,324
Licenses
and
Permits
$ 3,590,927
3,766,340
4,178,844
5,609,730
6,484,025
3,826,686
3,320,851
3,409,156
1,998,210
2,042,529
Charges for
Services
$9,181,814
9,819,230
6,805,386
10,707,653
7,614,902
6,805,147
5,749,416
6,427,307
7,751,065
10,058,671
Fines and
Forfeitures
$231,454
263,411
335,395
317,892
331,318
935,955
839,831
888,608
947,183
923,068
Income from
Property and
Investments
$3,996,127
4,415,975
4,862,050
6,075,188
8,632,261
8,925,565
10,495,817
20,384,618
18,700,470
14,801,549
Contributions
from Property
Owners
$ 344,851
2,148,548
9,359,802
15,450,861
25,861,948
45,763,304
14,733,063
15,982,528
11,250,770
14,546,966
Other(2)
$ 3,743,763
3,894,304
4,004,486
5,696,605
3,653,244
3,827,918
3,750,722
4,719,631
4,880,627
5,313,086
oQ
TRANSIENT OCCUPANCY TAX
LAST TEN YEARS
CHARGES FOR SERVICES
LAST TEN YEARS
Fiscal Year Fiscal Year
119
CITY OF CARLSBAD
Computation of Legal Debt Margin
June 30, 2003
Net assessed valuation $ 13.009.711.562
Debt limit ( 1 5% of 25% of net assessed valuation as adjusted) 487,864,184
Amount of debt applicable to debt limit:
Bonded debt 13,200,000
Certificates of participation 3,950,000
Obligations under capital leases _ 178.701
Total amount of debt applicable to debt limit 17,328.701
Legal debt margin $ 470.535,483
Percent of debt limit
Source: County of San Diego Office of the Auditor and Controller
120
CITY OF CARLSBAD
Schedule of Direct and Overlapping Bonded Debt
June 30, 2003
2002-03 Assessed Valuation: $13,265,871,448
Redevelopment Incremental Valuation: 256.159,886
Adjusted Assessed Valuation: $13,009,711,562
OVERLAPPING TAX AND ASSESSMENT DEBT: % Applicable Debt 6/30/03
San Diego County Water Authority 6.464% $ 106,333
Metropolitan Water District 1.164 5,171,594
Carlsbad Unified School District 98.076 23,837,477
Carlsbad Unified School District Lease Tax Obligations 98.076 907,203
Carlsbad Unified School District Community Facilities District No. 1 100.000 10,260,000
Oceanside Unified School District 0.009 4,429
Vista Unified School District 0.056 51,520
Encinitas Union School District 28.526 8,083,623
Encinitas Union School District Lease Tax Obligations 28.526 262,439
San Marcos Unified School District School Facilities Improvement District 36.762 7,078,379
San Marcos Unified School District Community Facilities District No. 5 100.000 24,840,000
San Dieguito Union High School District Community Facilities District No. 94-1 100.000 294,532
San Dieguito Union High School District Community Facilities District No. 94-2 98.327 21,180,029
San Dieguito Union High School District Community Facilities District No. 95-2 36.882 327,509
Olivenhain Municipal Water District, Assessment District No. 96-1 22.471 4,649,250
City of Carlsbad 1915 Act Bonds 100.000 36,550,000
TOTAL OVERLAPPING TAX AND ASSESSMENT DEBT $143,604,317
DIRECT AND OVERLAPPING GENERAL FUND OBLIGATION DEBT:
San Diego County General Fund Obligations 6.235% $ 29,669,171
San Diego County Pension Obligations 6.235 51,401,028
San Diego County Superintendent of Schools General Fund Obligations 6.235 128,909
Mira Costa Community College District Certificates of Participation 27.238 1,570,271
Carlsbad Unified School District General Fund Obligations 98.076 57,139,078
Encinitas Union School District Certificates of Participation 28.526 586,210
Other School District Certificates of Participation Various 267,926
City of Carlsbad General Fund Obligations 100.000 3,950,000
TOTAL DIRECT AND OVERLAPPING GENERAL FUND OBLIGATION DEBT $144,712,593
COMBINED TOTAL DEBT $288,316,910(l)
"'Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and tax allocation bonds and non-bonded capital lease
obligations.
Ratios to 2002-03 Assessed Valuation:
Total Overlapping Tax and Assessment Debt 1.07%
Ratios to Adjusted Assessed Valuation:
Combined Direct Debt ($3,950,000) 0.03%
Combined Total Debt 2.19%
SHARE OF AUTHORIZED AND UNSOLD GENERAL OBLIGATION BONDS:
Carlsbad Municipal Water District, I.D. No. 1 $99,414
Carlsbad Municipal Water District, I.D. No. 3 $200,000
STATE SCHOOL BUILDING AID REPAYABLE AS OF 6/30/03: $0
Source: California Municipal Statistics, Inc.
121
Fiscal
Year
1993-94
1994-95
1995-96
1996-97
1997-98
1998-99
1999-00
2000-01
2001-02
2002-03
CITY OF CARLSBAD
Construction and Business Activity
Last Ten Fiscal Years
Building
Permit
Revenue
$ 365,571
644,131
917,788
1,262,177
2,094,523
2,524,063
2,156,584
2,102,074
1,085,819
986,890
Business
Percent Estimated License
Chan
56
76
42
37
65
ge Valuation Revenue
1 $ 71,057,243 $1,093,827
2 145,344,099 1,245,830
4 162,116,427 1,491,159
6 305,247,426 1,510,462
9 479,909,805 1,603,744
20.5 588,527,417 1,737,850
(14 6) 468,596,775 1,863,514
(2.5) 513,763,904 2,300,367
(48 3) 272,671,912 2,440,387
(9.1) 265,175,025 2,305,178
ESTIMATED VALUATION OF BUILDING
PERMITS ISSUED - LAST TEN YEARS
$600 -(
$500 - 'v)a
•= $400 - •"i
e $300 • "
f/t
3 $200 - x
oQ
$100 -'4*
$0 -M— 11
^&.
^j=U
_fmfmiflWlON ONON ON
]•
r- oo ONON ON ONOS O\ ON
r^^ i^-3|
m m W>m By
s o o o5 O O O
Fiscal Year
Percent
Change
2.1
13.9
19.7
1.3
6.2
8.4
7.2
23.4
6.1
(5.5)
Source: City of Carlsbad Comprehensive Annual Financial Reports
122
CITY OF CARLSBAD
Water Enterprise
Revenue Bond Coverage
Last Ten Fiscal Years
Fiscal
Year
1993-94
1994-95
1995-96
1996-97
1997-98
1998-99
1999-00
2000-01
2001-02
2002-03
Gross
Revenue'1'
$ 15,188,913
15,912,020
17,147,790
18,911,511
18,356,555
19,942,226
22,178,880
23,187,752
24,925,994
23,791,166
Total
Expenses'2'
$ 12,286,557
12,690,114
13,998,346
14,692,531
14,583,879
16,732,975
18,609,221
18,027,298
19,310,792
19,261,199
Net Revenue
Available for
Debt Service
$ 2,902,356
3,221,906
3,149,444
4,218,980
3,772,672
3,209,251
3,569,659
5,160,454
5,615,202
4,529,967
Principal
$ 775,000
825,000
880,000
1,040,000
955,000
995,000
1,040,000
1,075,000
1,120,000
1,175,000
Debt Service
Interest
$ 751,248
700,098
644,822
494,954
264,695
227,450
187,650
145,010
99,860
51,700
Requirements
Total
$ 1,526,248
1,525,098
1,524,822
1,534,954
1,219,695
1,222,450
1,227,650
1,220,010
1,219,860
1,226,700
Coverage
1.90
2.11
2.07
2.75
3.09
2.63
2.91
4.23
4.60
3.69
BO
oO
(I)
(2)
Includes operating and non-operating revenues.
Includes operating and non-operating expenses.
WATER ENTERPRISE GROSS REVENUE
VS. TOTAL EXPENSES
LAST TEN YEARS
Fiscal Year
D GROSS REVENUE B TOTAL EXPENSES
WATER ENTERPRISE REVENUE
AVAILABLE FOR DEBT SERVICE
LAST TEN YEARS
$6
Fiscal Year
Source: City of Carlsbad Comprehensive Annual Financial Reports
123
CITY OF CARLSBAD
Schedule of Assessed Valuation
Last Ten Fiscal Years
Less Property
Fiscal Year Secured Property Unsecured Property Exemptions
1993-94 $ 5,858,987,695 $ 270,120,519 $ 36,151,898
1994-95 5,673,354,814 288,206,831 40,417,338
1995-96 5,676,061,219 310,402,764 46,279,594
1996-97 5,811,751,594 348,706,124 55,138,448
1997-98 6,232,883,670 352,854,173 57,681,797
1998-99 7,154,426,710 424,962,226 78,827,023
1999-00 8,675,347,964 419,824,253 85,462,447
2000-01 10,289,895,123 422,862,440 95,111,634
2001-02 11,586,003,633 519,294,090 115,461,551
2002-03 12,801,430,765 487,682,538 131,448,341
Does not include redevelopment incremental valuation or State-assessed unitary values.
Source: County of San Diego Office of the Auditor and Controller
124
Total Homeowner's Net Assessed
Assessed Valuation^1' Exemptions Valuation
$ 6,092,956,316 $ 94,519,630 $ 5,998,436,686
5,921,144,307 96,173,142 5,824,971,165
5,940,184,389 98,488,810 5,841,695,579
6,105,319,270 100,249,766 6,005,069,504
6,528,056,046 103,825,400 6,424,230,646
7,500,561,913 108,623,200 7,391,938,713
9,009,709,770 119,026,600 8,890,683,170
10,617,645,929 127,530,200 10,490,115,729
11,989,836,172 139,157,200 11,850,678,972
13,157,664,962 147,953,400 13,009,711,562
NET TAXABLE VALUE
LAST TEN YEARS
$14 i"
$12 •'
CS> _- ._ _g $10--'
« $8 • ^ ^ga
~ ^ J=m jam «m Hig $6 - ^ <^||| fsstja ^aa fssa ^m mr
$0 M ^i ^J ^j -^J ^4 ^1TT in ^> t^ oo o\ o
fZ
• ^y.
o oo o
Percentage
Change
(1.1)
(2.9)
0.3
2.8
7.0
15.1
20.3
18.0
13.0
9.8
f. t. rii
Fiscal Year
125
Year
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
20 10 (Estimate)
2020 (Estimate)
Square
Miles
42.2
42.2
42.2
42.2
42.2
42.2
42.2
42.2
42.2
42.2
42.2
42.2
42.2
Population0'
66,481
66,652
66,479
68,010
70,532
73,688
77,550
82,030
83,469
88,013
90,271
102,739(2)
108,501(2)
CITY OF CARLSBAD
Demographic Statistics
Last Ten Fiscal Years
Population
Percent
Change
1.8
0.9
(0.2)
2.3
3.7
4.5
5.2
5.8
1.8
5.4
2.6
13.8
5.6
County
Population'0
2,614,222
2,638,511
2,658,584
2,682,093
2,724,437
2,794,785
2,853,258
2,911,468
2,883,595
2,918,300
2,961,579
3,388,400<3)
3,863,500(3)
City
Population
Percent
of County
2.5
2.5
2.5
2.5
2.6
2.6
2.7
2.8
2.9
3.0
3.0
3.0
2.8
(1) Source: State Department of Finance.
(2) Source: Based on City of Carlsbad projected residential construction estimates in 2003-2004 Capital Improvement Program.
(3) Source: State Department of Finance Population Projections (May 2003).
100,000 -I"
90,000 - '
80,000 • '
70,000 - '
60,000 • '
50,000 • '
40,000 • ' '
30,000 - ' '
20,000 • '
10,000 -'
POPULATION
LAST TEN YEARS
_^^
jam
SI—
-Jp•*ro\CT\
M
V)o\0\
u
iH
•••• ";-|
\o3
—
p
.'S
1
t^3
p
l:y=
00a\o\
—
p
p
a\o\o\
p
si
jfj.
o
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—
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30
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te
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-
r
Fiscal Year
126
CITY OF CARLSBAD
Property Tax Levies and Collections
Last Ten Fiscal Years
Fiscal
Year
1993-94
1994-95
1995-96
1996-97
1997-98
1998-99
1999-00
2000-01
2001-02
2002-03
$30 Y
$25 • 'V)a03 $20 •'§
a $15 - '
£ f
- $10-'oG $5 -'
$0 -Mi-
Total
Current Lew
$12,373,782
11,977,833
11,891,199
12,227,583
13,277,486
15,115,611
17,923,250
20,959,581
23,554,392
26,220,028
Total Current
Collections
$11,593,369
10,843,322
11,164,134
11,551,981
12,636,654
14,421,616
17,110,252
20,085,365
22,705,762
25,200,220
PROPERTY TAX LEVIES & COLLECTIONS
LAST TEN FISCAL YEARS
r*sat mm
iiuiHJ »J PJ BJ i LI BJBJ HJ H-
% of Levy
Collected
93.7
90.5
93.9
94.5
95.2
95.4
95.5
95.8
96.4
96.1
|JU
%ON ON
Fiscal Year
D LEVIES • COLLECTIONS
Source: County of San Diego Office of the Auditor and Controller
127
CITY OF CARLSBAD
Principal Employers
2002 - 2003
FIRM
Manufacturing
Callaway Golf
Taylor Made Golf- Adidas Golf Company
Acushnet Golf
ViaSat
Tyco-Healthcare
Ashworth
Modern Postcard/The Iris Group, Inc.
Melles-Griot, Inc.
Invitrogen
Non-Man ufacturing
Four Seasons Resort - Aviara
LEGOLAND, California
Carlsbad Unified School District
La Costa Resort & Spa
City of Carlsbad
Gemological Institute of America
24-Hour Fitness
SOMC Group, Inc.
Wells Fargo Mortgage Resources
ISIS Pharmaceuticals
Grand Pacific Palisades
PRODUCT/SERVICE EMPLOYEES
Golf Equipment 2,500
Golf Equipment 727
Golf Equipment 540
Data Communications 465
Respiratory Products 450
Golf Apparel 350
Custom Promotional Cards 320
Laser Optics 300
Research Supplies 295
Resort 1,100
Family Theme Park 1,100
Education 875
Hotel/Health Spa 650
Municipal Government 603
Gemological School 500
Health Club Headquarters 450
Software Distributor 380
Banking 325
Research and Development 300
Hotel Mgmt/Timeshare Development 300
Source: City of Carlsbad, Chamber of Commerce
128
Taxpayer
Callaway Golf Company
Aviara Resort Associates
La Costa Hotel & Spa Corporation
Legoland California, Inc.
Continuing Life
Real Estate Collateral Mgmt. Co.
Prentiss Properties
Air Products & Chemicals
H. G. Fenton Company
Universe Institutional
SSR Western MultiFamily, LLC
Santa Fe Ranch LLC
CITY OF CARLSBAD
Principal Taxpayers
2002 - 2003
Type of Business
Manufacturer
Resort & Golf Course
Hotel & Health Spa
Family Theme Park
Senior Retirement Community
Real Estate
Real Estate
Manufacturer
Distribution Warehouse
Residential Apartment Rentals
Real Estate
Residential Apartment Rentals
Valuation
$178,033,606
127,260,300
125,837,967
105,000,000
95,321,386
69,264,936
68,418,264
63,640,951
61,714,726
51,711,630
47,853,207
46,039,800
$1,040,096,773
Percentage of Net
Assessed
Valuation(l)
1.4%
1.0%
1.0%
0.8%
0.7%
0.5%
0.5%
0.5%
0.5%
0.4%
0.4%
0.4%
8~0%
(i)Net assessed valuation for 2002-2003:$13,009,711,562
Source: County of San Diego Office of the Auditor and Controller
129
CITY OF CARLSBAD
Top 30 Sales Tax Generators
2002 - 2003
Firm Product/Service
Aviara Resort Associates
Banana Republic
Bob Baker Jeep
Bob Baker Volkswagen
Carlsbad Toyota
Carlsbad Volvo
Costco Wholesale
Discover Infiniti Carlsbad
Dixon Ford
Gap Outlet
Hoehn Acura
Hoehn Honda
Invitrogen Corporation
J C Penney Company
Jim Finney Pontiac
La Costa Resort & Spa
Legoland
Lexus Carlsbad
Macy's Department Store
Pacific Sales Kitchen & Bath
Polo Ralph Lauren Outlet
Reliable Wholesale Lumber
Robinsons-May Department Store
Rorick Buick/Cadillac
Sears Roebuck & Company
Townsend Lincoln/Mercury
Toyota Motor Credit
Vons Grocery Company
Weseloh Chevrolet
Worthington Dodge
* Companies are listed in alphabetical order.
Hotel/Food Sales
Clothing Store
Car Dealership
Car Dealership
Car Dealership
Car Dealership
General Stores
Car Dealership
Car Dealership
Clothing Store
Car Dealership
Car Dealership
Manufacturer of Research Supplies
Department Store
Car Dealership
Hotel/Food Sales/Spa
Family Theme Park
Car Dealership
Department Store
Furniture/Appliance
Clothing Store
Building Materials
Department Store
Car Dealership
Department Store
Car Dealership
Automobile Lessor
Grocery/Food Markets
Car Dealership
Car Dealership
Source: MBIA MuniServices Company
130
CITY OF CARLSBAD
Miscellaneous Statistical Information
2002 - 2003
Date of Incorporation July 16, 1952
Type of City General Law
Form of Government Council/Manager
Area 42.19 sq. miles
Population (CA Dept of Finance Report 01/01/03) 90,271
Net Assessed Valuation $13,009,711,562
Streets:
Number of Street Lights 6,336
Miles of Streets 295
Fire Protection:
Number of Stations 6
Number of Firefighters & Officers 73
Police Protection:
Number of Stations 1
Number of Sworn Police Officers 107
Municipal Water District:
Number of Customers 76,730
Number of Water Connections 24,500
Average Daily Consumption (in Millions of Gallons) 18.6
Miles of Lines and Mains 400
Miles of Sewers 149
Recreation and Culture:
Number of Parks 39
Acres of Parks (Improved Community & Special Use Areas) 295
Acres of Open Space (Special Resource Areas & General
City-Owned Open Space) 490
Number of Pools 1
Number of Libraries 2
Number of Materials in Circulation 319,032
Total Number of Authorized Full-Time City Employees 646
Source: City of Carlsbad, Finance Department
131