HomeMy WebLinkAbout; ; 2017-2018 CAFR; 2018-06-30Comprehensive Annual
Financial Report
FISCAL YEAR ENDEDJune 30, 2018
Fiscal Year Ended June 30, 2018
Comprehensive Annual Financial Report
Comprehensive Annual
Financial Report
Fiscal Year Ended
June 30, 2018
Prepared by the
Finance Department
1635 Faraday Ave.
Carlsbad, CA 92008
www.carlsbadca.gov
i
CITY OF CARLSBAD
Comprehensive Annual Financial Report
Year Ended June 30, 2018
Table of Contents
Page
Introductory Section:
Letter of Transmittal 1
City Council’s FY 2017-18 Strategic Goals 4
Certificate of Achievement for Excellence in Financial Reporting, Government Finance Officers
Association 15
Location Map 16
List of City Officials 17
Organization Chart 18
Financial Section:
Independent Auditor’s Report 19 Management’s Discussion and Analysis 22
Basic Financial Statements
Government-wide Financial Statements:
Statement of Net Position 42
Statement of Activities 44
Fund Financial Statements:
Balance Sheet – Governmental Funds 46
Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position 48
Statement of Revenues, Expenditures and Changes in Fund Balances – Governmental Funds 50
Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of
Governmental Funds to the Statement of Activities 52
Statement of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual –
General Fund 53
Statement of Net Position – Proprietary Funds 56
Statement of Revenues, Expenses and Changes in Net Position – Proprietary Funds 60
Statement of Cash Flows – Proprietary Funds 62
Statement of Net Position – Fiduciary Funds 66
Statement of Changes in Net Position – Fiduciary Funds 67
Notes to the Financial Statements 68
Required Supplementary Information
Schedule of Changes in Net Position Liability and Related Ratios During Measurement Period 114
Schedule of Plan Contributions 117
Schedule of Changes in Net OPEB Liability and Related Rations During Measurement Period 118
Schedule of Plan Contributions 121
ii
TABLE OF CONTENTS (CONTINUED)
Page
Combining and Individual Fund Financial Statements and Schedules
Combining and Individual Fund Statements and Schedules:
Combining Balance Sheet – Nonmajor Governmental Funds 124
Combining Statement of Revenues, Expenditures and Changes in Fund Balances – Nonmajor Governmental Funds 128
Combining Schedule of Revenues and Expenditures – Budget and Actual (Budgetary Basis) –
Special Revenue Funds 132
Combining Schedule of Revenue and Expenditures – Budget and Actual (Budgetary Basis) –
Capital Project Funds 134
Combining Statement of Net Position – Internal Service Funds 136
Combining Statement of Revenues, Expenses and Changes in Net Position – Internal Service Funds 138
Combining Statement of Cash Flows – Internal Service Funds 140
Combining Statement of Changes in Assets and Liabilities – Agency Funds 144
Statement of Fiduciary Net Position – Private Purpose Trust Fund 146
Changes in Fiduciary Net Position – Private Purpose Trust Fund 147
Statistical Section:
Financial Trends:
Net Position by Component – Last Ten Fiscal Years 150
Changes in Net Position – Last Ten Fiscal Years 152
Fund Balances of Governmental Funds – Last Ten Fiscal Years 156
Changes in Fund Balances of Governmental Funds – Last Ten Fiscal Years 158
General Governmental Tax Revenues by Source – Last Ten Fiscal Years 160
Revenue Capacity:
Water and Wastewater Rates – Last Ten Fiscal Years 161
Assessed Value of Taxable Property – Last Ten Fiscal Years 162
Direct and Overlapping Property Tax Rates – Last Ten Fiscal Years 163
Principal Property Taxpayers – Current Year and Nine Years Ago 165
Property Tax Levies and Collections – Last Ten Fiscal Years 166
Debt Capacity:
Ratios of Outstanding Debt by Type – Last Ten Fiscal Years 168
Schedule of Direct and Overlapping Bonded Debt – Current Fiscal Year 170
Direct and Overlapping Debt – Last Ten Fiscal Years 172
Legal Debt Margin Information – Last Ten Fiscal Years 174
Pledged-Revenue Coverage – Last Ten Fiscal Years 176
Demographic and Economic Information:
Demographic and Economic Statistics – Last Ten Fiscal Years 178
Principal Employers – Current Year and Nine Years Ago 180
Operating Information:
Authorized Full and ¾ Time City Government Employees by Program Area –Last Ten Fiscal Years 182
Operating Indicators by Function/Program – Last Ten Fiscal Years 184
Capital Asset Statistics – Last Ten Fiscal Years 186
Introductory Section Introductory Section
Introductory Section
Introductory Section
Administrative Services Department
Finance Division 1635 Faraday Avenue Carlsbad, CA 92008 760-602-2430 t
www.carlsbadca.gov 760-602-8553 f
1
December 10, 2018
Honorable Mayor, City Council,
and Citizens of the City of Carlsbad
CITY OF CARLSBAD
Carlsbad, CA 92008
LETTER OF TRANSMITTAL
2017-18 COMPREHENSIVE ANNUAL FINANCIAL REPORT
Honorable Mayor, City Council, and Citizens:
I am pleased to present the Fiscal Year 2017-18 Comprehensive Annual Financial Report (CAFR) for the City
of Carlsbad (“city”). 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, 2018.
Management assumes full responsibility for the completeness and reliability of the information contained
in this report, based upon a comprehensive framework of internal controls that it has established for this
purpose. Because the cost of internal controls should not outweigh its 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.
State law and the city’s Municipal Code require that an annual financial report is prepared. This report
fulfills that obligation. It has been prepared in conformity with generally accepted accounting principles
(GAAP) and with the financial reporting requirements prescribed by the Governmental Accounting
Standards Board (GASB). The independent auditing firm, Davis Farr LLP, has issued an unmodified (“clean”) opinion on the city’s financial statements for the year ended June 30, 2018. The independent auditor’s
report is located at the front of the financial section of this report.
Management’s Discussion & Analysis (MD&A) immediately follows the independent auditor’s report and
provides a narrative introduction, overview and analysis of the basic financial statements. The MD&A
complements this letter of transmittal and should be read in conjunction with it.
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 statements, but also on the audited
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 Compliance Reports and Other Financial Information. The results of the city’s
Single Audit for the fiscal year ended June 30, 2018 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. In June 2008, the voters of Carlsbad overwhelmingly approved the city to change to a Charter City.
Carlsbad is located on the southern California coast, about 35 miles north of the City of San Diego. The city
2
is governed by a five-member City Council under the Council Manager form of government. The City Council
is elected by district, on a staggered basis, for a term of four years. The city currently has four districts;
however, the mayor is elected at large. 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 39 square
miles and has a population of 114,622, with
an expected built out population of 120,000
residents. Commercial activities in the city
include: a major regional shopping center, a
specialty outlet center, a commercial center
with upscale retail shops, 38 hotels offering
4,623 rooms, 236 short-term vacation
rentals and 668 timeshares for tourist
lodging, over 24 auto dealers, high
technology, multimedia and biomedical
businesses, electronics, golf apparel and
equipment manufacturers, several business
and light industry parks, and numerous land
developers building single and multi-family housing in a variety of community settings.
This report includes financial statements for the city, the Housing Authority of the City of Carlsbad, the
Carlsbad Public Financing Authority, and the Carlsbad Municipal Water District. Through these entities,
Carlsbad provides a full range of services to its citizens and customers including:
• Police protection services
• Development services
• Fire and paramedic services
• Street construction and maintenance
• Water delivery system
• Library and arts programs
• Wastewater system
• Recreation programming for all ages
• Solid waste services
• Park lands
• Housing programs
In addition to the full range of services normally associated with a municipality, Carlsbad offers programs
to help residents and businesses. The city’s Housing Authority administers federal housing assistance to
570 low-income households in Carlsbad, and older residents can take advantage of Carlsbad’s senior citizen
programs.
Budget Process
The Carlsbad Municipal Code requires that the City Manager annually prepare a budget for the City Council
with a message describing important features and to assume responsibility for the budget’s administration
after adoption. The budget process begins in January each year, when the City Council meets to develop
goals that help city staff prioritize programs, projects and services, as well as the resources required to fund
them (see City Council Goals on the next page). Once the goals and priority projects are developed, city
staff develops operational goals and work plans based on the City Council’s direction. These goals and work
plans provide the basis for the development of the annual budget. The City Council adopts the formal
budget for all funds at the beginning of each fiscal year and may amend those budgets throughout the year,
as necessary.
Budgetary control for the city is maintained through its accounting systems. 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.
3
Community Vision
These nine core values make up the Carlsbad Community Vision. They were developed in collaboration with the community and drive both the day to day work of the city and its long term planning.
Small town feel, beach community character and connectedness – Enhance Carlsbad’s
defining attributes—its small town feel and beach community character. Build on the
city’s culture of civic engagement, volunteerism and philanthropy.
Open space and the natural environment – Prioritize protection and enhancement of
open space and the natural environment. Support and protect Carlsbad’s unique open
space and agricultural heritage.
Access to recreation and active, healthy lifestyles – Promote active lifestyles and
community health by furthering access to trails, parks, beaches and other recreation
opportunities.
The local economy, business diversity and tourism – Strengthen the city’s strong and
diverse economy and its position as an employment hub in north San Diego County.
Promote business diversity, increased specialty retail and dining opportunities, and
Carlsbad’s tourism.
Walking, biking, public transportation and connectivity – Increase travel options through
enhanced walking, bicycling and public transportation systems. Enhance mobility
through increased connectivity and intelligent transportation management.
Sustainability – Build on the city’s sustainability initiatives to emerge as a leader in green
development and sustainability. Pursue public/private partnerships, particularly on
sustainable water, energy, recycling and foods.
History, the arts and cultural resources – Emphasize the arts by promoting a multitude
of events and productions year-round and cutting-edge venues to host world class
performances, and celebrate Carlsbad’s cultural heritage in dedicated facilities and
programs.
High quality education and community services – Support quality, comprehensive
education and lifelong learning opportunities, provide housing and community services
for a changing population, and maintain a high standard for citywide public safety.
Neighborhood revitalization, community design and livability – Revitalize
neighborhoods and enhance citywide community design and livability. Promote a
greater mix of uses citywide, more activities along the coastline and link density to public transportation. Revitalize the downtown Village as a community focal point and a unique
and memorable center for visitors, and rejuvenate the historic Barrio neighborhood.
4
City Council Strategic Policy Goals
Become a leader in multimodal transportation systems and creative approaches to moving
people and goods through and within Carlsbad.
The City Council expects Carlsbad to become a leader in the broad array of plans and systems
that support more efficient and effective means of moving people and goods around and
through Carlsbad and the region, including technology that improves traffic signal coordination
and vehicle operation. Major regional projects, including the McClellan-Palomar Airport master
plan update, double tracking of the railroad, widening of I-5 and reconfiguration of the I-5/78
interchange, require continued policy-level involvement to ensure Carlsbad’s interests are
reflected in project design and implementation.
Plan for a new city hall that will meet the future workplace and operational needs of the city
and the community.
Plan for a new city hall that will be a point of pride for citizens while greatly improving efficiency
and effectiveness by centralizing an employee base that is currently spread through many
facilities. A strategic approach to locating city operational functions will provide better coordination among city functions and enhanced customer service.
Promote education to increase civic engagement and attract and retain talent in Carlsbad.
The City Council will take a stewardship role in encouraging the development of high quality educational experiences that foster economic development, civic engagement and community
leadership. This broad goal will be pursed through the continuation of ongoing programs and
as new opportunities arise, and as such, no specific Fiscal Year 2017-18 Work Plan is proposed.
Future status reporting will be provided on an as needed basis.
Enhance Carlsbad’s coastline to ensure an exceptional experience in all the ways people want
to enjoy it.
The Carlsbad coastline is a critical element of the city’s identity. The City Council is committed
to making policy decisions to ensure Carlsbad’s coastline maintains the character the
community loves while enhancing access, amenities and mobility to a level consistent with Carlsbad’s high-quality community standards. This includes partnering with State Parks, which
currently controls most of Carlsbad’s beaches. This goal also includes physical changes that will
enhance natural beauty, better manage traffic flow, expand walking and biking opportunities,
improve safety and create a uniquely Carlsbad experience.
Lower the railroad tracks in a trench through the Village to improve safety, community
connectivity, quality of life and economic value.
The busy rail line that runs through the core of the community divides Carlsbad. Railroad traffic,
which will increase significantly in coming years, has adverse effects on the City of Carlsbad,
especially in the area between the Agua Hedionda and Buena Vista lagoons. With the planned addition of a second, parallel track through the Village and Barrio, the city has an opportunity
to lower the tracks below street level, similar to what has been done in other coastal
communities. Achieving this goal would improve safety and increase coastal access. Without
this change, the future quality of life and business climate in the Village would be irreparably
harmed, the Barrio would remain cut off from the coast, and public safety would be severely
compromised.
Enhance the health and vitality of the Village and Barrio, two neighborhoods that represent
the historic heart of Carlsbad.
The city has made significant investments in the revitalization of the Village and Barrio, starting
with “Redevelopment” and continuing with public-private partnerships and city funded
infrastructure improvements. A new Village and Barrio Master Plan is nearing completion, and
achieving the vision developed with the community through the master planning process will require continued policy focus and investment.
5
FACTORS AFFECTING FINANCIAL CONDITION
Economic Profile
The University of San Diego (USD)
monitors the health of the San Diego
economy through its Index of Leading
Economic Indicators. The chart to the
left reflects historical movement in the
USD’s Leading Economic Indicators.
The index, which measures local stock
prices, help wanted advertising, and
other pertinent metrics, fell 0.2
percent in May. The biggest
contributor to the drop was a big
decrease in online help wanted
advertising. Initial claims for
unemployment insurance were also
moderately negative while there was a
small decline in residential units
authorized by building permits. On the positive side, local stock prices were up moderately, but consumer
confidence and the outlook for the national economy were up only slightly. Although the number of
components up and those down were even at three apiece, the negatives outweighed the positive to push
the USD Index to its second straight loss.
The Carlsbad economy generally moves in line with the county and the state. Property taxes for this year,
Fiscal Year 2017-18, increased by almost 4.6 percent compared to the previous year, as assessed values
remain strong in real estate and some additional development has entered the inventory. Transient
Occupancy tax (TOT) paid by hotel guests, increased by 8.8 percent for the same period, which is being
driven primarily by an increase in the average daily rate (ADR) that hotel guests are paying, the opening of
the new LEGOLAND Hotel, a higher occupancy rate, and additional short-term vacation rentals. Sales tax
revenues ended Fiscal Year 2017-18 at $35 million, an improvement of 1.2 percent, as we continue to see
strength in restaurants, new auto sales, department stores, and some additional occupancy at the Shoppes
at Carlsbad. Overall, General Fund revenues ended the current year up 4.6 percent as some smaller revenue
sources, such as those related to development, have fallen slightly during the year.
From 1992 to 2008, commercial and industrial development in Carlsbad averaged approximately 1.1 million
square feet per year. As opportunities for new development diminish, commercial and industrial
development is tapering off, falling to an average of approximately 315,000 square feet per year over the
next five fiscal years. Large industrial and commercial developments in the next five years include a Westin,
Carlsbad Oaks, and the expansion of the ViaSat campus. Commercial office space vacancy has witnessed a
decline over the past several years, falling from over 30 percent in the last quarter of 2009 to 19.3 percent
in April 2018. Industrial vacancy is 7.5 percent (9.1 percent, last year) and retail vacancy remains relatively
stable at 2.7 percent (2.4 percent, last year), according to data from CoStar.
6
Housing prices in Carlsbad
have accelerated in the
past year, shown in the accompanying graph.
According to data from
CoreLogic, the median
price of a single-family
residence (SFR) being
resold is $989,000, an
increase of over 21
percent compared to this
time, last year. Price
increases for resale SFRs
are positive in all
quadrants, although both
92008 (northwest
quadrant) and 92009 (southwest quadrant) saw double digit growth. Condominiums have also seen large
increases citywide, and now top a median sales price of $600,000. According to data from Movoto,
inventories are up 17 percent over last year and homes are staying on the market for 29 days. Total
assessed property values in Carlsbad are $29.4 billion for the current fiscal year, an increase of almost six
percent. The city is expected to add almost 1,700 new residential units over the next five years.
Commercial development has brought much needed entertainment and shopping venues to citizens and
visitors alike, as well as generating additional sales tax to help pay for city services. Carlsbad is home to:
Car Country Carlsbad – an auto mall; the Carlsbad Premium Outlets – a specialty outlet center; The Shoppes
at Carlsbad – a regional shopping mall; a Costco center; and the Forum at Carlsbad – a commercial center
with upscale retail shops, restaurants and other commercial uses. A new Lowe’s opened in fall 2013 and La
Costa Town Square opened in Fiscal Year 2014-15.
Development has also enhanced Carlsbad’s reputation as a destination resort for tourism. The city is host
to a major family theme park, LEGOLAND, and has two luxury resorts available for its visitors, the Park Hyatt
at Aviara and the Omni La Costa Resort & Spa. There are several other quality hotels and motels in the city, with the most recent additions being the Hilton Oceanfront Resort & Spa (recently renamed Cape Rey
Carlsbad, a Hilton Resort) and the LEGOLAND California Resort. New rooms will be added to the inventory
in Fiscal Year 2018-19 at the Sheraton, with over 70 of those rooms under the Westin brand.
The City of Carlsbad opened a municipal golf course in the summer of 2007, which enhanced the tourism
attractions the city offers. The municipal golf course, the Crossings at Carlsbad, is an 18-hole, destination
golf course set in the rolling hills and canyons of Carlsbad. With ocean views, high quality golf experience,
a first-class restaurant and clubhouse, and linkages to hiking trails, the Crossings at Carlsbad is a destination
spot for golfers and non-golfers alike.
Overall, for Fiscal Year 2018-19, General Fund revenue is projected to increase by 4.4 percent from the
previous year. Most major sources of tax revenue are expected to increase in Fiscal Year 2018-19, including
property tax, which is expected to grow by 5.4 percent. Sales tax is projected to increase 3.4 percent and
TOT revenues are projected to increase by almost 11 percent as occupancy, average daily rates (ADR) and
the number of available rooms increase. The forecast captures additional room inventory from the Westin
and LEGOLAND hotels in Fiscal Year 2018-19. Property values continue to appreciate, as discussed earlier.
Development related revenues are forecast to decrease by over 35 percent in Fiscal Year 2018-19,
compared to the previous year, a trend that is expected to continue as buildout is approached.
7
State of California – In January 2018, Governor Jerry Brown submitted the proposed
budget to the legislature. He continues to call for fiscal vigilance and caution as he
expects the state to experience another recession at some point in the near future. Although he maintains committed to spending for schools, infrastructure, and
health and welfare programs, he also cites the importance of addressing staggering
liabilities and maintain the Rainy Day Fund.
The Fiscal Year 2018-19 state budget proposal recognizes that spending has
increased markedly in the past five years, as California legislated an increase in the minimum wage that will
ultimately see $15 per hour, and the expansion of health care for millions of Californians. The budget does
not capture the effect of federal tax legislation passed in December 2017, that will likely have an impact on
the state as Californians lose the ability to deduct state taxes on their federal income tax returns. The
Governor’s May budget revision assumes that the federal tax changes will provide a temporary boost to
the national economy and provide fiscal gains to many Americans, however the full implications for the
state’s taxpayers will not be known for many years. The budget also acknowledges the risks to the state’s
financial position from challenges to the Affordable Care Act. If this legislation is overturned by Congress, it would cost California tens of billions from the General Fund, assuming the state would backfill lost federal
funding for these benefits. The budget continues to increase funding for K-12 education and for the
California university systems and community colleges. Due to the recent increase in the Gas Tax, the budget
proposed $55 billion in spending over the next decade on transportation projects ranging from
neighborhood roads to passenger rail improvements.
The governor’s budget does not account for the recession he predicts, but he notes that even a moderate
recession could impact the states’ revenues by $20 billion. To prepare for this eventuality, the budget
proposes to increase the Rainy Day Fund to its full reserve requirement in Fiscal Year 2018-19 of $13.5
billion, an increase of $5.1 billion over the current level. Additionally, the budget addresses the staggering
liabilities that plague the state. Of the unfunded liability of $275 billion, $272 billion are related to the
pension costs associated with state and University of California employees. The state paid an additional $6
billion to CalPERS in 2017 in an effort to mitigate this ongoing issue.
Long-Term Financial Planning
To strategically address the future needs of the city and to ensure that the city maintains a structurally
balanced budget in the long term, the city prepares a ten-year financial forecast. Revenue projections are
developed based on current and forecasted economic variables at the national, state, and local levels, and
provide city leaders with some measurement of future capacity to support city programs and services. In
recent years, revenue growth has become more difficult to project in the long-term, with an economic
climate that changes rapidly and unpredictably. The forecast allows decision makers to adjust for these
changes. The ten-year forecast is updated frequently to avoid potential pitfalls and to ensure that fiscal
challenges are identified and resolved, and to ensure the continued development of a balanced and
responsible budget.
During the Great Recession, the city took deliberate actions to ensure that the budget remained structurally
balanced. These measures included: a reduction in full-time and hourly full-time equivalent (FTE) positions,
delaying the construction of non-essential capital projects, reducing the funding for capital outlay and
priority projects, reducing and/or eliminating cost of living salary increases, requiring employees to pay a
larger portion of their retirement costs, using technology and other tools to create efficiencies, and reducing
certain non-essential service levels with a minimal impact to the community. The ten-year forecast
identifies increasing labor costs as CalPERS, the administrator for the city’s employee pension plan, embarks
on a strategy to remove risk from their investment portfolio. The city is taking steps to adjust to these
increases and provide ongoing resources to continue providing service levels expected by residents.
The ability to anticipate changes in revenue sources and to balance those resources against the costs related
to ongoing and future programs, services, and infrastructure requirements is critical to the financial health
of the city. The city relies on the General Fund forecast to effectively manage fiscal resources and map a
sustainable and responsible path for attaining the goals of the community. The tumultuous economic
environment experienced in the past few years makes this long-term perspective even more important.
8
The forecast assumes limited growth in residential and commercial development over the next decade and
captures the expected revenue impacts from major projects that are expected to be completed during the
forecast period. Ongoing transfers to the Crossings at Carlsbad Golf Course ceased last fiscal year, following Council action in the adopted budget to retire outstanding construction debt, almost twenty years ahead
of the original maturity. The operating costs of new city facilities projected in the Capital Improvement
Program and supported by the General Fund, such as Pine Avenue Community Center, are also captured in
the forecast. Economic conditions at the national, state, and local level are expected to continue to improve
at a modest rate and to provide a boost to most of the major revenue sources. Home prices, which saw
large decreases during the recession, continue to recover and are providing support to city’s property tax
revenues in the following years, and it appears that trend is continuing. Overall, the outlook for General
Fund revenues continues to be positive and revenues are expected to exceed ongoing operating costs over
the period of the forecast.
The forecast assumes that General Fund revenues will increase by 4.4 percent in Fiscal Year 2018-19, as
economic conditions continue to improve, bolstering revenues from the property tax, sales tax, and TOT.
To project the expenditures, all known changes in personnel and maintenance and operations costs are
accounted for. However, the effects of future negotiations with employee bargaining units are not
contemplated in the current ten-year forecast. The forecast also captures increases in operating costs
associated with planned capital improvements, such as future parks and civic facilities.
The forecast assumes that the city’s cost for employee health care will increase by 5.25 percent in FY 2018-
19 and will increase over the forecast period to 6.5 percent in future years. CalPERS, the administrator of the city’s employee pension plan, continues with their risk mitigation strategy, which involves lowering the
assumed rate of return on pension assets from 7.5 percent to 7.0 percent over a three-year period. The
results of this drop in assumed rate of return on the mature pension plan will increase pension costs to the
city in future years. Fiscal Year 2018-19 will be the first year in which the rate decreases, but the effects do
not materialize in the forecast until Fiscal Year 2019-20, when there is a 15 percent increase in the city’s
annual required contribution (ARC). Annual pension costs after Fiscal Year 2019-20 are less severe and are
assumed to normalize at an annual increase of three percent. The City Council took action to pay off
approximately $9 million in the unfunded actuarial liability during the budget adoption process for Fiscal
Year 2017-18; and if similar actions are taken in future years, this will continue to decrease the city’s ARC,
holding all other variables that affect annual costs, such as investment returns, constant. CalPERS may take other actions in the future, to continue to make the statewide pension fund more fiscally sustainable, and
9
such action will be captured in future forecasts. The state wide funded status for CalPERS hovers around
70 percent. The forecast does not consider increases in staffing levels beyond Fiscal Year 2018-19, except
those that may be related to the operating costs of new city facilities supported by the General Fund. Negotiated salary increases and future salary growth projections are included in personnel costs in the
forecast, in order to provide a conservative estimate of future costs. The contribution from the General
Fund to the Infrastructure Replacement Fund is forecasted to remain at 6.5 percent of General Fund
revenues. Finally, the forecast includes estimated operating costs for all capital projects in the timeframes
shown in the Capital Improvement Program (CIP).
As indicated in the graph on the previous page, the General Fund is balanced for Fiscal Year 2018-19 and
revenues exceed expenses over the life of the forecast. Although the revenue forecast is positive, Carlsbad
faces the same challenges that plague the national and state finances, including pension costs that are more
volatile and the overall health of the economy. Despite these threats, responsible fiduciary stewardship
and planning have placed the city in a position to benefit from even modest improvements in the economic
environment.
Major Initiatives and Projects
In the city’s Fiscal Year 2018-19 Capital Budget, several significant projects are in design or under
construction over the next five years. Some of the notable capital projects are discussed below.
PARK PROJECTS
The city is currently implementing several
park projects, as a result of a needs
assessment and subsequent updated
master plans. The city worked with the
community to identify current needs and
priorities for parks and recreation
programs, and summarized the input in the
Parks and Recreation Department Master
Plan. The city then updated individual master plans for Poinsettia Community
Park, Aviara Community Park, Pine Avenue
Community Park and Leo Carrillo Ranch
Historic Park.
Aviara Community Park Event Gathering
Space and Picnic Areas – The additional park amenities include: a large passive outdoor public gathering
space, group picnic areas, a perimeter walking path and a catering support room complete with appliances
to support outside catering and food and beverage services for small events. The total cost is $3.9 million.
Leo Carrillo Phase III – This historic park is in the southeast quadrant of the city. Expenditures include a new
restroom building, restoration of the horse stables to allow occupancy for events, an outdoor interpretive
plan to educate and focus on the life and times of Leo Carrillo, and native people and plants. Also included
is visitor way-finding signage and additional lighting. The total estimated cost is $3.0 million.
Calavera Hills Community Park Gateway Improvements – Located at the northeast corner of Calavera Hills
Community Park, this lot will be developed into an aesthetically pleasing gateway with passive recreational
uses, at an estimated total cost of $872,000.
Poinsettia Community Park and Dog Park – Planned improvements include a fenced dog park for both large
and small dogs, pickleball courts, updated tot lots and a multi-sports arena with a picnic area and artificial
turf field, at a total cost of $5.3 million.
10
Robertson Ranch Master Plan – This 13-acre park site is located within the Robertson Ranch development
located in the northeast quadrant of the city. Funding in the amount of $200,000 was previously
appropriated for the development of a master plan.
Veterans Park Master Plan – This 92-acre site is located on the east side of Faraday Avenue, just south of
Cannon Road, across from The Crossings at Carlsbad Golf Course. An appropriation of $200,000 will fund
the initial phase, to include conducting public outreach and development of a master plan.
CIVIC FACILITY IMPROVEMENTS
Civic facilities include a variety of facilities from which the city provides its services to the public. This
category also includes repair, maintenance, and replacement of those facilities.
New City Hall – One of the five City
Council goals is breaking ground on a new
city hall at a site designated for a future
civic center complex by the year 2023.
Initial efforts will include site location and
public outreach.
Orion Center – This city facility will bring
together offices, the fleet maintenance yard, a warehouse, and parking to
accommodate the various work groups at
one location, on a site near the existing
Safety Center and Fleet yard. The total
estimated project cost is $38.4 million.
Fire Station No. 2 Reconstruction – Fire Station No. 2, located at the corner of El Camino Real and Arenal
Road, was originally constructed in 1969 for one full-time firefighter and a yearly call volume of less than
250 per year. Today, the station maintains a staff of five full-time firefighters with a call volume of
approximately 4,000 per year. Funding for the reconstruction project was approved by a vote of the residents at a cost not-to-exceed $10.5 million.
Monroe Street Pool Replacement – The Monroe Street Pool is located on Monroe Street, adjacent to
Carlsbad High School. This project will ultimately replace the pool, decking, gutters, mechanical building,
restrooms/lockers/shower facilities and administrative areas. The current estimated cost is $5.1 million.
Stagecoach Park Synthetic Turf Replacement – The Stagecoach Park athletic field is scheduled for synthetic
turf replacement at a cost of $1.8 million.
Other Facilities Maintenance Projects – As the city facilities begin to age, maintenance and repair projects
are needed to keep them in good condition. In the next five years, an additional $6.5 million has been
allocated to projects, including the following:
• Cannon Park Restroom
• City Facility Accessibility Upgrades
• Faraday Administrative Facility Upgrades
• Fire Station No. 4 Expansion
• Fleet Maintenance Facility Refurbishment
• Safety Center Facility Improvements
11
STREET AND CIRCULATION PROJECTS
People of all ages and abilities want to go places safely and conveniently in Carlsbad, whether they drive, walk, bike, or ride a bus or train. The livable streets concept, also called "complete streets," acknowledges
that streets are an important part of the livability of today's communities and ought to be for everyone.
Carlsbad has made livable streets a priority when planning and constructing improvements to city
roadways. This includes modernizing roads and traffic systems and investing in programs to make it easier
to get around town, whether by car, on a bike, by foot, or via public transit. In addition to constructing
improvements, the city continues to invest in the maintenance and operation of the transportation
infrastructure by providing timely repairs and rehabilitation of the public assets associated with the
roadways and public rights of way throughout the city.
Adaptive Traffic Signal Program – This citywide program will implement adaptive signal coordination
systems at approximately 150 traffic signal and intersection locations, to improve the flow of traffic
throughout the city. An additional $950,000 in funding will be added in Fiscal Year 2018-19 to the existing
program budget of $1.9 million. This phase of the Adaptive Traffic Signal Program will complete the upgrade
of the traffic signal equipment throughout the city, including the purchase and installation of equipment
that will use real-time data to “adapt” traffic signal operations to changing traffic patterns. The new
equipment will also monitor signal operations and send alarms alerting staff of potential equipment
malfunctions.
Avenida Encinas Widening – Street widening to full secondary arterial standards along Avenida Encinas from Palomar Airport Road to just south of Embarcadero Lane is scheduled for design in Fiscal Year 2019-20. The
CIP includes $5.3 million to fund the project in the next few years.
Beach Access Repair/Upgrades – Tamarack Avenue to Pine
Avenue – Funding of $5.8 million is included to pay for a
structural evaluation report for railings, girders, caissons,
concrete, etc., along with recommendations for repair and
rehabilitation to keep the beach access facilities in safe
condition.
Bridge Preventative Maintenance Program – This is a relatively
new program designed to perform preventative maintenance
activities on bridges throughout the city, at a total cost of $1.6
million.
Carlsbad Village Drive and Grand Avenue Pedestrian
Improvements – This project is estimated at $1.3 million and
will improve pedestrian features, roadway and sidewalk
improvements and safety barriers. Funding is scheduled in the
CIP in Fiscal Year 2020-21.
Chestnut Avenue Complete Street Project – This project will
reconfigure Chestnut Avenue to create a complete street with
high visibility crosswalks, curb extensions, bike lanes and
bicycle and pedestrian way finding signs, at a total cost of $1.1
million. Funding is scheduled in the CIP in Fiscal Year 2019-20.
Concrete Repair and Maintenance – The proposed spending plan includes $1.3 million in the next five years
for repairs to sidewalks, curb and gutter, pedestrian ramps, driveway approaches and cross gutters.
El Camino Real Widening from Arenal Road to La Costa Avenue – This project will add a southbound lane to
widen the road to full prime arterial standards, at an estimated cost of $2.5 million.
12
Pavement Management – Carlsbad’s local streets are maintained on a regular cycle to ensure a good riding
surface and to extend the life of the streets. Part of the maintenance program is the sealing and overlay of
the existing street surface. In addition, any problem areas are addressed as they are identified. Funding of $18.5 million is budgeted over the next five years for this program.
Poinsettia Lane Extension from Cassia Road to Skimmer Court – Completion of this segment of Poinsettia
Lane is the final link between Aviara Parkway and El Camino Real. The total cost is estimated at $14.1
million (previously appropriated).
Railroad Double Tracking – It is a City Council Goal to break ground on lowering the railroad tracks in a
trench through the Village to improve safety, community connectivity, quality of life and economic value.
To begin this effort, funding in the amount of $2.0 million has been included in the Fiscal Year 2018-19 CIP.
Road Diet and Traffic Calming Projects along
Valley Street and Kelly Drive – Projects are
planned in the next five years to provide
complete street solutions so that the varied
user of these roads, including pedestrians and
bicyclists, are provided for in a balanced and
equitable manner. The total cost is estimated
at $3.2 million.
Terramar Coastal Improvement – The project
will ultimately improve the public right of way
along Carlsbad Boulevard and Cannon Road to
provide a complete street, including
pedestrian/non-vehicular facilities, and along
the bluff, to enhance the quality of the open
space and beach access. Funding of $6.7 million
has been previously allocated to this project.
Traffic Signals/Traffic Control Improvements – In the next five years, traffic signal projects are planned at the following eight locations, at a total cost of $1.2 million:
• Camino De Los Coches and La Costa Avenue
• El Fuerte and Rancho Pancho
• Faraday Avenue and Camino Hills Drive
• Faraday Avenue and Palmer Way
• La Costa Avenue and Levante Street
• Maverick Way and Camino De Los Coches
• Poinsettia Lane and Cassia Road
• Poinsettia Lane and Oriole Court
Village and Barrio Traffic Circles – Installation of traffic circles at intersections throughout the Village and
Barrio are planned at a total cost of $1.5 million.
Village Intelligent Parking – Following the recommendations of the Village Parking Plan, this project will
install vehicle occupancy detectors in various locations in the Village using a ‘Park Once’ smart phone
application, and decrease congestion in the Village caused by cars searching for parking. The initial cost
estimate is $300,000.
13
WATER/WASTEWATER PROJECTS
The city’s water and wastewater projects are vital to the continued health and welfare of its citizens. Most new lines are built and paid with impact fees collected with new development. As the city ages, it will
become necessary to repair and replace the lines that already exist, and an increase in these projects is
anticipated in future years. In the next five years, an additional $68.8 million in funding is scheduled for
both new and replacement water and sewer projects.
Vista/Carlsbad Interceptor & Agua Hedionda Lift Station Replacement – This project consists of a set of
individual projects that will ultimately construct a parallel sewer interceptor system to accommodate
existing and future sewer flows from the cities of Vista and Carlsbad. The individual projects include: a main
in Jefferson Street, replacement of the Agua Hedionda Lift Station, and a main from the lift station to the
Encina Wastewater Facility. The overall total cost estimate for these projects totals $64.4 million, of which
approximately 64 percent is funded by the City of Vista and 36 percent by the City of Carlsbad.
Wastewater
Other wastewater facilities scheduled for construction or replacement within the next five years include:
• Buena Interceptor Sewer Improvements
• Faraday/El Camino Real Sewer Replacement
• Las Palmas Trunk Sewer
• Villas Sewer Lift Station Replacement
In total, the new construction, replacement projects, ongoing condition assessments, repairs and upgrades
to the city’s wastewater facilities are expected to cost $39.3 million in the next five years.
Water Lines
Major water facilities scheduled for construction, maintenance or replacement within the next five years
are estimated at $9.5 million, and include the following locations:
• Aviara Parkway and Plum Tree
• El Fuerte and Corintia Street Pressure Reducing Station
• Fire Flow System Improvements
• Hydroelectric Generator at Desal Flow Control Facility No. 5
• Maerkle Reservoir Floating Cover Replacement
• Palomar Airport Waterline Realignment
• San Dieguito Water Intertie and Pipeline Extension
• Santa Fe II Inlet Pipeline
In addition, $18.7 million is included in the next five years for miscellaneous pipeline replacements,
repair and maintenance projects, a condition assessment program, and a water valve repair and
replacement program.
Recycled Water Expansion
Expansion to the Carlsbad Water Recycling Facility, including construction of additional pipelines and a
reservoir, is anticipated to cost $34.5 million (previously appropriated). These facilities are expected to
meet the 76 percent increase in future recycled water demand. The expansion is expected to increase the
recycled water supply from 4 to up to 8 million gallons per day (mgd). With diminishing potable water
resources available, alternative supplies such as recycled and desalinated water become increasingly
important in supplementing the total water supply.
14
DRAINAGE PROJECTS
The city’s drainage infrastructure plays an important role in handling storm water runoff flows, as well as
maintaining the water quality of the city’s creeks, lagoons and ocean. Carlsbad supports programs that will
ensure that all water bodies within the city are safe and clean and, where possible, open to the public at all
times. The system consists of drainage pipes 30-inches or larger in diameter, large concrete and rock lined
channels, permanent sedimentation basins and miscellaneous large facilities. As the city continues to age,
it will become necessary to repair and replace the lines that already exist. An additional $7.3 million will be
added to the program in the next five years.
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 for its CAFR for the fiscal year ended June
30, 2017. This was the 20th consecutive year that the city has achieved this prestigious award. 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 GAAP and applicable legal
requirements.
A Certificate of Achievement is valid for a period of one year only. The city strives to develop a CAFR which
will continue to meet the Certificate of Achievement Program’s requirements, and this report will be
submitted to GFOA to determine its eligibility for another certificate.
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 finance staff, especially
Aaron Beanan, Finance Manager. I also appreciate the staff of Davis Farr 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, the City Manager and the city’s Executive
Management Team for their leadership and unfailing support in maintaining the highest standards of
professionalism in the management of the city’s finances.
Respectfully submitted,
Kevin Branca
Finance Director
16
17
Elected Officials
Matt Hall, Mayor
Keith Blackburn, Mayor Pro Tem
Mark Packard, Council Member
Michael Schumacher, Council Member
Cori Schumacher, Council Member
Barbara Engleson, City Clerk
Craig Lindholm, City Treasurer
Leadership Team
Scott Chadwick, City Manager
Celia Brewer, City Attorney
Elaine Lukey, Chief Operations Officer
Gary Barberio, Assistant City Manager
Chris Hazeltine, Parks & Recreation Director
Laura Rocha, Administrative Services Director
Paz Gomez, Public Works Director
Debbie Fountain, Community & Economic Development Director
Heather Pizzuto, Library & Cultural Arts Director
James Wood, Environmental Manager
Jason Haber, Assistant to the City Manager
John Maashoff, Public Works Manager
Julie Clark, Human Resources Director
Kevin Branca, Finance Director
Kristina Ray, Communication Manager
Michael Calderwood, Fire Chief
Morgen Fry, Secretary to the City Manager
Neil Gallucci, Police Chief
Maria Callander, Information Technology Director
Sheila Cobian, City Clerk Services Manager
Vicki Quiram, Utilities Director
Boards and Commission Chairs
Cathy Breslaw, Arts Commission
Linda Petrucci, Beach Preservation Committee
Timothy Stripe, Carlsbad Golf Lodging Business Improvement District
Timothy Stripe, Carlsbad Tourism Business Improvement District Board
Laurie Boone, Historic Preservation Commission
Alan Newman, Housing Commission
Sherman DeForest, Library Board of Trustees
Matt Simons, Parks & Recreation Commission
Marty Montgomery, Planning Commission
Ray Pearson, Senior Commission
Chuck Hunter, Traffic Safety Commission
Vacant, Underground Utility Advisory Committee
City Attorney City Manager
ELECTORATE
City Treasurer
KEY
Elected
Council Appointed
Council Appointed
Organization Chart
City CouncilCity Clerk
Arts
Commission
Beach
Preservation
Committee
Senior
Commission
Parks & Rec
Commission
Library Board
of
Trustees
HistoricPreservationCommission
Housing
Commission
Traffic Safety
Commission
Planning
Commission
Carlsbad Tourism
B.I.D. Advisory
Board
Carlsbad Golf
Lodging B.I.D.
Advisory Board
Finance
Information Technology
Environmental Programs
General Services
Transportation Engineering & Construction
Utilities
Assistant City Manager Community Services Administrative Services Public Works Public Safety
Chief Operations
Officer
Fire
Police
Community Outreach & Engagement
Human Resources
Chief Innovation Officer
City Clerk’s Office
Library & Cultural Arts
Real Estate
Community & Economic Development
Parks & Recreation
Financial Section Financial Section
Financial SectionFinancial Section
City Council City of Carlsbad Carlsbad, California
INDEPENDENT AUDITORS’ REPORT
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, the aggregate remaining fund information of the City of Carlsbad, California, as of and for the year ended June 30, 2018, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express opinions on these 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 from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the City’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
19
City Council City of Carlsbad, California Page Two
Opinions
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 as of June 30, 2018, and the respective changes in financial position and, where applicable, cash flows and the statement of revenues, expenditures and changes in fund balance - budget to actual of the general fund for the year then ended in accordance with accounting principles generally accepted in the United States of America.
Emphasis of Matter
As described further in note 20 to the financial statements, during the year ended June 30, 2018, the City implemented Governmental Accounting Standards Board (GASB) Statements No. 75 and No. 89. The implementation of GASB No. 75 resulted in a prior period adjustment. Our opinion is not modified with respect to these matters.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the Management’s Discussion and Analysis, the Schedule of Changes in Net Pension Liability and Related Ratios During Measurement Period, Schedule of Pension Plan Contributions, Schedule of Changes in Net OPEB Liability and Related Ratios During Measurement Period and Schedule of OPEB Plan Contributions be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City of Carlsbad's basic financial statements. The combining and individual nonmajor fund financial statements and schedules, the introductory section and the statistical section are presented for purposes of additional analysis and are not a required part of the basic financial statements. The combining and individual nonmajor fund financial statements and schedules are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such
20
City Council City of Carlsbad, California Page Three information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the combining and individual nonmajor fund financial statement and schedules are fairly stated, in all material respects, in relation to the basic financial statements as a whole. The introductory section and the statistical section have not been subjected to the auditing procedures applied in the audit of the basic financial statements, and accordingly, we do not express an opinion or provide any assurance on it.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated December 10, 2018 on our consideration of the City of Carlsbad's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering City of Carlsbad’s internal control over financial reporting and compliance.
Irvine, California December 10, 2018
21
22
Management’s Discussion and Analysis
Management of the City of Carlsbad (“city”) provides readers this overview and analysis of the financial activities of the
city for the fiscal year ended June 30, 2018. The 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. The information presented here should be considered in
conjunction with the additional information furnished in the letter of transmittal.
Overview of the Financial Statements
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.
o The Governmental Funds Financial Statements detail how general government services, such as public safety,
were financed in the short-term, as well as what remains for future spending.
o Proprietary Funds Statements offer short- and long-term financial information about the activities the city
operates like businesses, such as providing water and wastewater services.
o Fiduciary Funds 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
greater detail. The statements are accompanied by required supplementary information that further explains and
supports the information in the financial statements. In addition to these required elements, included is a section with
combining fund statements that provides financial information about the 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 (MD&A) explains the structure and
content of each of the statements.
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 Position 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 position and how it has changed. Net position –
the difference between the city’s assets and liabilities – is one way to measure the city’s financial health, or position.
Over time, increases or decreases in the city’s net position are an indicator of whether the city’s financial health is
improving or deteriorating, respectively. Additional non-financial factors should be considered, 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.
23
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,
and internal services 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 cost of certain services it
provides. The city’s water, wastewater, solid waste
and municipal golf course operations 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 used
by the city 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 Rental 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 future spending. Consequently, the Governmental Funds Statement 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. The statements are presented on a modified accrual basis of accounting.
A reconciliation between the long-term and short-term focus of the Government-wide Financial Statements is
provided immediately following each statement. There are currently three governmental fund types being used by
the city: the General Fund, special revenue funds, and capital project funds.
• Proprietary funds – Services for which the city charges customers a fee are generally reported in proprietary funds.
Proprietary funds, like Government-wide Financial Statements, provide both long- and short-term financial
information, and are presented on an accrual basis of accounting.
There are two types of propriety funds, enterprise funds and internal service funds:
o Enterprise funds are used to report activities that provide business-type services, generally to external customers
– such as water, wastewater, solid waste, and golf services. In both the Government-wide Financial Statements
and the Fund Financial Statements, these funds are shown under business-type activities.
o Internal service funds are used to report activities that provide services and supplies for the city’s other programs
and activities – such as fleet, workers’ compensation, risk / liability, and information technology.
24
• 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 Position.
These activities are excluded 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 Position
The city’s combined net position as of June 30, 2018, as shown below, was $1.769 billion. The city’s net position increased
by $28.6 million as compared to the prior fiscal year. This increase was derived in large part due to a significant increase
in capital assets (a large amount of developer donated assets from the developers of La Costa Town Square, the Hilton
Beach Resort, Tabata 10, and Fair Oaks Valley, as well as the completion of the Pine Avenue Park Community Center)
deferred outflows related to pension costs and other post-employment benefits (OPEB) as well as revenues exceeding
expenses for the year. Current and other assets were impacted by revenues exceeding expenses by $28.6 million, leading
to an increase in cash and investments of $25.9 million. The increase in revenues is due to higher interest received (the
yield on the Treasurer’s portfolio is up for the year as well as higher cash balances), timing differences in the billing of
city utilities (higher accounts, net of allowances), and additional billings to the City of Vista for their share of the
Vista/Carlsbad Wastewater Interceptor project (due from other governments). The increase in capital assets is discussed
in more detail in the capital asset section of this MD&A. Changes in the various components associated with the
Government Accounting Standards Board (GASB) pension pronouncement impacted deferred outflows and inflows, and
increased the pension liability for the year. This GASB pronouncement required the city to put the net pension liability
on the books. Other liabilities increased due to higher year-end accruals from vendor invoices.
Total
Percentage
Change
2017 2018 2017 2018 2017 2018 2017-18
Current and other assets $623.3 $640.2 $152.2 $155.2 $775.5 $795.4 2.6%
Capital assets 788.9 793.7 360.7 364.5 1,149.6 1,158.2 0.7%
Total assets 1,412.2 1,433.9 512.9 519.7 1,925.1 1,953.6 1.5%
Deferred outflows 48.1 60.3 3.5 5.6 51.6 65.9 27.7%
Other liabilities 24.5 27.7 17.3 17.1 41.8 44.8 7.2%
Net OPEB liability 0.0 1.5 0.0 1.0 0.0 2.5 100.0%
Net pension liability 155.2 167.4 12.7 14.0 167.9 181.4 8.0%
Long-term debt outstanding 0.8 0.6 15.9 14.9 16.7 15.5 -7.2%
Total liabilities 180.5 197.2 45.9 47.0 226.4 244.2 7.9%
Deferred inflows 7.0 5.8 0.4 0.7 7.4 6.5 -12.2%
Net position
Net investment in
capital assets 788.1 793.1 344.8 349.5 1,132.9 1,142.6 0.9%
Restricted 234.9 236.1 40.1 39.5 275.0 275.6 0.2%
Unrestricted 249.8 262.0 85.2 88.6 335.0 350.6 4.7%
Total net position $1,272.8 $1,291.2 $470.1 $477.6 $1,742.9 $1,768.8 1.5%
Total
CITY OF CARLSBAD'S NET POSITION
(in millions of dollars)
Governmental
Activities
Business-Type
Activities
As noted earlier, over time, net position may serve as a useful indicator of the city’s financial position. For the city, assets
currently exceed liabilities by $1.769 billion at the close of the most recent fiscal year.
25
A large portion of the city’s net position (64.6 percent) reflects its net 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 in 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 would not
be used to pay for these liabilities.
An additional portion of the city’s net position (15.6 percent) represents resources that are subject to external restrictions
on how they may be used. The remaining balance of unrestricted net position ($350.6 million) may be used to meet the
government’s ongoing obligations to citizens and creditors.
Just under 33 percent of the $262 million in unrestricted governmental activities net position is attributable to the
General Fund. This is an increase from the previous fiscal year, due to strong revenue growth, primarily in property, sales
transient occupancy (TOT), franchise and business license taxes. In addition, the yield on Treasurer’s portfolio continues
to increase, creating additional income from property and investments. Another factor affecting the growth in the
unrestricted governmental activities net position was a reduction in transfers out. In the previous fiscal year, transfers
were made by the General Fund to pay off the golf course bonds and to fund the relocation of Fire Station No. 2. The
net investment in capital assets for the city increased moderately during FY 2017-18, due primarily to developer donated
assets (streets, sidewalks, streetlights, water and wastewater lines) and the completion of the Pine Avenue Park
community center. A portion of business-type net position represents the city’s municipal golf course. At the end of FY
2017-18, there is a large deficit in unrestricted net position for the Golf Course Fund. This is the result of the General
Fund advancing money to the Golf Course Fund for the construction of the course and partially subsidizing the operations
of the course in prior fiscal years.
The condensed summary of activities shows that net position increased by $28.6 million during the year. This increase
occurs when spending is less that the revenues received. There were several reasons for the increase in net position:
$29.3 million in “savings” in the General Fund is being carried forward into the new fiscal year by various major service
areas within the city to enhance and provide for future services and programs (indicating spending levels less than
budgeted expenditures); revenues outpacing budgeted projections due to the continuing economic recovery; the build-
up of cash reserves in the city’s capital project and enterprise funds for future capital project construction and acquisition,
as well as rate stabilization efforts due to the purchasing of more expensive water from the desalination facility; revenues
received in the city’s special revenue funds for future services and programs; and the donation of infrastructure assets
from developers.
26
Changes in Net Position
Approximately 69.5 percent of the revenues of the city’s governmental funds are generated through taxes collected
(property, sales, transient occupancy, etc.), and approximately 86.5 percent of the city’s business-type revenue is
generated through charges for services. The chart on the following page graphically depicts the city’s revenue sources.
Total
Percentage
Change
2017 2018 2017 2018 2017 2018 2017-18
Revenues
Program revenues
Charges for services $21.1 $21.0 $68.7 $75.4 $89.8 $96.4 7.3%
Operating grants and contributions 12.6 13.1 2.5 1.6 15.1 14.7 -2.6%
Capital grants and contributions 22.8 23.0 13.3 5.5 36.1 28.5 -21.1%
General revenues
Property taxes 64.0 66.5 3.6 3.7 67.6 70.2 3.8%
Sales and use taxes 34.0 33.7 - - 34.0 33.7 -0.9%
Other taxes 33.5 36.5 - - 33.5 36.5 9.0%
Income from property and investments 2.0 2.5 0.7 1.0 2.7 3.5 29.6%
Other 0.4 0.5 0.3 - 0.7 0.5 -28.6%
Total revenues 190.4 196.8 89.1 87.2 279.5 284.0 1.6%
Expenses
General government 18.4 25.2 - - 18.4 25.2 37.0%
Public safety 56.0 62.6 - - 56.0 62.6 11.8%
Community services 54.2 51.9 - - 54.2 51.9 -4.2%
Public works 34.3 36.9 - - 34.3 36.9 7.6%
Carlsbad Municipal Water District - - 45.2 51.7 45.2 51.7 14.4%
Golf course - - 10.2 10.5 10.2 10.5 2.9%
Wastewater - - 12.6 13.5 12.6 13.5 7.1%
Solid waste - - 3.3 3.1 3.3 3.1 -6.1%
Total expenses 162.9 176.6 71.3 78.8 234.2 255.4 9.1%
Excess (deficiency) before transfers 27.5 20.2 17.8 8.4 45.3 28.6 -36.9%
Transfers (15.1) (0.1) 15.1 0.1 - - 0.0%
Increase (decrease) in net position 12.4 20.1 32.9 8.5 45.3 28.6 -36.9%
Beginning position, as restated 1,258.7 1,271.1 436.2 469.1 1,694.9 1,740.2 2.7%
Ending net position $1,271.1 $1,291.2 $469.1 $477.6 $1,740.2 $1,768.8 1.6%
Activities Activities Total
CITY OF CARLSBAD'S CHANGES IN NET POSITION
(in millions of dollars)
Governmental Business-Type
27
The city’s revenues have continued to remain strong during this exceptionally long economic expansion since the “Great
Recession.” The city’s “big three” revenue sources are sales, property, and transient occupancy taxes (TOT). TOT
continues to grow through increased occupancy, average daily rates (ADR) and new hotel rooms. In the most recent
three fiscal years, the last of the “big three” taxes, property taxes, has shown some significant growth. An increase in
assessed values for residential, commercial and industrial properties (assessed values increased by 5.36 percent) led to
higher property tax revenues. This was the third time since the recession (a lagging indicator of the financial health of
the city) that the city saw growth in all three assessed value components (residential, commercial and industrial). Higher
room and occupancy rates throughout the city, as well as the additional of two new hotels (the second LEGOLAND Hotel
and the Westin Hotel) led to higher TOT for the year. Sales tax revenues were up for the year, but only slightly. The state
recently implemented a new system that impacted the timing of sales tax revenues for the year. This timing difference
should correct itself in FY 2018-19. The city implemented a new business license system in November 2016, creating
timing differences in the receipt of license revenues. FY 2017-18 saw the first full year using the new system, generating
additional revenues for the fiscal year as compared to the prior fiscal year. As expected, development slowed down
during FY 2017-18, but remained strong for the year. Income from property and investments were heavily impacted by
two factors: the unrealized losses created by adjusting the city’s investments to their fair market value at June 30, 2018
(as required by GASB) and an increase in the average yield on the Treasurer’s portfolio for the year (an increase in the
yield from 1.248 percent last fiscal year to 1.572 percent in the current fiscal year). These two factors netted against
each other to create a moderate increase in income from property and investments. The end of statewide drought
mandated conservation measures and an increase in water rates led to an increase in water sales (charges for services) for the year. A decrease in the donation of developer constructed assets (roads, pipelines, sidewalks, etc.) and a
reduction in recycled water grants led to the decrease in capital grants and contributions.
The total cost of all programs and services was just over $255.4 million in FY 2017-18. This was moderately higher than
the FY 2016-17 figure of $234.2 million. General government expenses were higher from a supplementary CalPERS
payment made ($1 million more than FY 2016-17), additional legal and expert costs associated with the county airport
28
expansion and the Safety Training Center lawsuit, and higher personnel costs due to personnel increases. Other factors
in the personnel increase were: higher public safety expenses created by the addition of two police ranger patrol
positions and two additional police officer positions, higher mutual aid costs, normal salary and benefit increases, and
the filling of prior year vacancies. During the fiscal year, the city combined community services and community
development into one line. Now, community services includes: parks and recreation, library and cultural arts, and
community and economic development activities. The increase in purchased water costs, due to decreased drought
conservation efforts, and the purchase of costlier desalinated water in the Water Fund, created the increase in expenses
for the year in business-type activities.
• General Government (10 percent)
This segment of the city is divided into three major groups: Policy and Leadership, Administrative Services and non-
departmental charges. The Policy and Leadership group encompasses all elected officials, the chief executive offices
for the city, Records Management, and the Community Outreach and Engagement team. The Administrative
Services group includes Finance, Human Resources (including Workers’ Compensation and Self-Insured Benefits),
Information Technology, and Risk Management. Also included in non-departmental are any Council directed special projects.
• Public Safety (25 percent)
Public Safety has always been a top City Council priority. This major service area includes the Police Department,
whose mission is to protect and serve the community with integrity, professionalism, and valor. 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.
29
• Community Services (20 percent)
Community Services consists of Library and Cultural Arts, Parks and Recreation, and Community and Economic
Development. Library and Cultural Arts provides educational, informational, and cultural arts services for all
community residents, which contribute to quality of life by supporting lifelong learning, the pursuit of knowledge,
and creating the availability of community gathering places. Parks and Recreation offers comprehensive
opportunities for meeting the recreational and social needs and interests of the community by providing programs
for all segments of the population. The mission of Community and Economic Development is helping people build a
strong community by guiding and facilitating high quality projects, preserving the environment, providing for and
maintaining a strong economic and employment base, and strengthening neighborhoods through partnerships and
collaboration to improve or enhance the quality of life and sense of community within Carlsbad. Community and
Economic Development encompasses Land Use Planning, Economic Development, the Hiring Center, Housing and
Neighborhood Services, Land Development Engineering, and Building.
• Public Works (15 percent)
Public Works is responsible for building and maintaining all the infrastructure assets of the city. This service area
includes Transportation, Construction Management and Inspection, Storm Drain Engineering, Asset Management,
the Buena Vista Channel, Street Lighting, Traffic Operations, Planning and Signal Maintenance programs, Property
and Fleet Management, and Environmental Management.
• Golf Course (4 percent)
The city opened a municipal golf course in the summer of 2007, further enhancing the tourist attractions the city
offers. The municipal golf course, The Crossings at Carlsbad, is an 18-hole golf course set in the rolling hills and
canyons of Carlsbad. With ocean views, a high-quality golf experience, a first-class restaurant and clubhouse, and
linkages to hiking trails, The Crossings at Carlsbad is a destination for golfers and non-golfers alike.
• Solid Waste (1 percent)
The Solid Waste Division of the Utilities Department administers and monitors the solid waste contract and the
Palomar Transfer Station agreement, and is responsible for the waste reduction and recycling components of the
Source Reduction and Recycling Element and Household Hazardous Waste Element to comply with state mandated
diversion and disposal requirements. Also included in this section is the Storm Water Protection Program, whose
goal is to provide leadership and stewardship of the city’s resources protecting the city’s beaches, creeks and
lagoons.
• Water Operations (20 percent)
The Carlsbad Municipal Water District (CMWD), a subsidiary of the city, provides potable and recycled water service
to approximately 85 percent of the city (approximately 29,000 customers). CMWD purchases 100 percent of its
potable water, which includes a new local supply of desalinated seawater, as treated water from the Metropolitan
Water District and the San Diego County Water Authority. The District also provides recycled water for irrigation
purposes.
• Wastewater Operations (5 percent)
The city operates and maintains a sanitary wastewater collection system, which covers approximately 65 percent of
the geographic area of the city. Wastewater is treated by the Encina Wastewater Treatment Plant, a facility jointly
owned by the cities of Carlsbad, Vista and Encinitas; the Leucadia Wastewater District; the Vallecitos Water District;
and the Buena Sanitation District.
30
The following sections will provide information about the operations of the governmental and business-type activities
separately.
Governmental Activities
The increase in net position for governmental activities was $20.1 million. This increase was generated by total revenues
of governmental activities of $196.8 million ($57.1 million in program revenues and $139.7 million in general revenues)
offset by $176.6 million in total costs of governmental activities, and $100,000 in transfers to the Solid Waste Fund.
The table below presents the total cost of each of the city’s major programs, as well as each program’s revenue (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 programs (costs
covered by general revenues).
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 ($21 million), grants and contributions from other
governments and organizations which subsidize certain programs ($36.1 million), and taxes and other revenues (such as
income from property and investments) received by the city to pay for the “public benefit” portion, totaling $139.7
million.
Community Services revenues are derived from development activities throughout the city, housing assistance programs,
parks and recreation fees, and library fees. A large portion of Community Services revenues is comprised of housing
assistance programs (Section 8 Rental Assistance, affordable housing loan repayments, and developers paying into the
Affordable Housing Trust Fund) as well as charges for development related services. Although development activity was
strong during FY 2017-18, offsetting a portion of the program expenses, development activity actually decreased from
the prior fiscal year, as expected.
The majority of Public Works revenues are used to acquire and build capital assets (versus covering operating expenses).
In addition, the donation of capital assets from developers is reflected in the program revenues for Public Works. Capital
assets are generally constructed or purchased once sufficient funds have been accumulated to pay for the cost. The city
has entered a new stage of its lifecycle, from a developing or growing stage, to a mature stage. As the city continues to mature and approach build-out, there will be fewer master planned projects. In past years, these projects constructed
31
new facilities, roads, parks, and other city-owned infrastructure. The city is shifting its focus towards maintenance of
existing facilities, and will use funding sources such as the Infrastructure Replacement Fund to maintain and replace
these assets. There are still some master planned communities that were recently completed or are near completion,
including the La Costa Oaks Industrial Park and Robertson Ranch, the developers of these communities dedicated
infrastructure to the city, a requirement for development.
Business-type Activities
Program revenues for the city’s business-type activities totaled $82.5 million for the year, while program expenses
equaled $78.8 million.
Water program revenues are higher than program expenses, primarily due to increased demand for potable and recycled
water. Revenues from water sales are higher than the previous fiscal year due to the net effect of an average 2.5 percent
increase in water rates (water and delivery charges) that went into effect in January 2018, a 4.85 percent rate increase
that went into effect in January 2017, and the elimination of state mandated drought conservation efforts which led to
an 11 percent increase in sales during the fiscal year.
Wastewater program revenues exceeded program expenses due to personnel vacancies and higher than budgeted
revenues. The higher revenues were due to increased development, which added more homes to the system and
decreased conservation from the enterprises’ volumetric based customers.
Capital construction expenses are spread over the life of an asset as annual depreciation charges (program expenses),
and are not reflected as an expense in the year acquired.
The city’s golf course enterprise was in its eleventh full year of operation. Golf course revenues were sufficient to fund
normal golf course operating expenses excluding depreciation expenses, resulting in a net loss of $2.5 million.
A more detailed discussion of each of the enterprises can be found in the Proprietary Funds Section.
32
Financial Analysis of the City’s Funds
As noted earlier, the city uses fund accounting to ensure compliance with finance related legal requirements. In the
current Comprehensive Annual Financial Report (CAFR), the implementation of a prior Governmental Account Standards
Board (GASB) pronouncement resulted in the Community Activity Grants Fund being combined with the General Fund
for financial statement presentation.
Governmental Funds
The focus of the city’s governmental funds is to provide information on near-term inflows, outflows, and balances of
spendable resources. This information is useful in assessing the city’s financing requirements. In particular, unassigned
fund balances may serve as a useful measure of a government’s net resources available for spending at the end of the
fiscal year.
There are five fund balance classifications: non-spendable, restricted, committed, assigned, and unassigned. These fund
balance classifications comprise a hierarchy based primarily on the extent to which a government is bound to observe
constraints imposed upon the use of the resources reported in governmental funds. Detail of the fund balances by
classification is shown in Note 10 of the financial statements. As of the end of the current fiscal year, the city’s
governmental funds reported combined ending fund balances of $566.4 million, up $13.1 million from the year before.
Approximately 9 percent ($51.6 million) constitutes non-spendable fund balances, mostly comprised of advances and
loans to other funds. Restricted fund balances can only be spent for a specific purpose stipulated by law and make up
about 42 percent ($236 million). Assigned fund balances are intended to be used by the city for specific purposes but do
not meet the criteria to be classified as restricted or committed. These make up 34 percent ($195.2 million) of the city’s
fund balance. Approximately 15 percent ($82.6 million) of the fund balance is unassigned, which is available for spending
33
at the city council’s discretion. Of the $82.6 million unassigned fund balance, the City Council has set aside $10 million
for economic uncertainty purposes. However, accounting standards require that the $10 million set aside be shown as
part of the city’s unassigned fund balance.
Total
Increase Percentage
(Decrease) Change
2017 2018
Revenues
Taxes $129.9 $136.2 $6.3 4.8%
Intergovernmental 1.2 1.3 0.1 8.3%
Licenses and permits 3.0 3.0 0.0 0.0%
Charges for services 10.3 10.0 (0.3) -2.9%
Fines and forfeitures 0.7 0.7 0.0 0.0%
Income from property and investments 2.6 3.0 0.4 15.4%
Miscellaneous 1.1 1.4 0.3 27.3%
Total revenues 148.8 155.6 6.8 4.6%
Expenditures
General government 25.7 25.9 0.2 0.8%
Interdepartmental charges (3.4) (3.2)0.2 -5.9%
Public safety 57.0 58.0 1.0 1.8%
Community services 38.3 38.6 0.3 0.8%
Public works 16.0 15.9 (0.1) -0.6%
Total expenses 133.6 135.2 1.6 1.2%
Excess (deficiency) before transfers 15.2 20.4
Transfers in 0.0 0.2
Transfers out (37.2) (12.9)
Increase (decrease) in fund balance (22.0) 7.7
Beginning fund balance 193.4 171.4
Ending fund balance $171.4 $179.1
2017-18
Total
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
GENERAL FUND
(in millions of dollars)
The General Fund is the main operating fund of the city, and at the end of the fiscal year had a total fund balance of
$179.1 million, an increase of $7.7 million. The unassigned fund balance portion of the General Fund was $82.6 million,
an increase of $4.4 million from last fiscal year. During the previous fiscal year, the General Fund made two large one-
time transfers: a $14.8 million transfer to the Golf Course Fund to pay off the outstanding construction bonds and a
$10.5 million transfer to the General Capital Construction Fund for the relocation of Fire Station No. 2. Finally, in the
previous fiscal year, the city made an additional $9 million payment to CalPERS to assist in the stabilization of future
retirement costs. Of the $9 million payment to CalPERS, $4.5 million was paid for out of a previously assigned fund
balance and $5.5 million was funded through the current year surplus. In the current fiscal year, the city made an
additional payment to CalPERS to assist in the stabilization of future retirement costs. Of the $11 million additional
payment made to CalPERS, $9.7 million was charged to the General Fund and the remaining $1.3 million was charged to
the Water and Wastewater Enterprises. These additional expenditures were heavily offset by the growth in several key
revenues during the year: property taxes, TOT, sales tax, business license taxes, franchise fees, income from property
and investments, contributions from property owners for special studies, and miscellaneous reimbursed expenditures.
The economy continues to remain strong. This was evident as all the tax revenues in the city saw moderate to significant
growth during the year. Development activity within the city saw a small decrease (charges for services and licenses and
34
fees), after an extremely strong 2016-17 fiscal year, and was expected. As the city approaches buildout, several of the
remaining large residential master planned communities and industrial/commercial parks saw a reduction in
construction activity as they neared completion, leaving only a small portion of the city undeveloped. This slower pace
is projected to continue for the foreseeable future as the city approaches buildout.
In the city’s FY 2017-18 budget, expenditures were expected to increase 2.8 percent over the FY 2016-17 budget to
$145.7 million. The total personnel budget for FY 2017-18 was $90.4 million, which was 2.8 percent more than the
previous year’s personnel budget of $87.7 million. The total maintenance and operations (M&O) budget for FY 2017-18
was $42.7 million, which was 1.5 percent higher than the previous year’s budget of $42.1 million. The increase in
personnel budgets was based on previously negotiated salary and benefit increases, the net addition of 27.33 new staff
members (10.0 full-time, 1.0 limited-term, and 16.33 part-time staff), and projected retirement rate increases. Smaller
increases were projected for health insurance and workers’ compensation. Despite giving a 2.0 percent M&O escalator
to all General Fund departments, the FY 2017-18 budget was offset by decreases in one-time expenditures from the
previous fiscal year, and decreases in internal service charges. In addition to the 2.0 percent escalator and the reduction
in one-time costs from the prior fiscal year, the FY 2017-18 M&O budget included higher bank card fees, increases in
legal professional services, higher citywide training and development costs, additional costs associated with nuisance
abatement, consulting services to assist with the documentation of business process and procedures related to the new
permitting system, operating costs associated with several new park facilities, fire engine equipment, a chemical detox
unit to remove toxic chemicals from firefighters, and upgrades to the Safety Training Center audio visual equipment.
Transfers out of the General Fund were budgeted at $12.5 million, an $800,000 increase from the prior fiscal year. This
increase was due primarily to increases in the transfers from the General Fund to the IRF ($510,000) and the Median
Maintenance and Street Tree Maintenance Special Revenue Funds ($250,000). Adding to the adopted budget of $145.7 million for the General Fund, approximately $24.9 million in unspent FY 2016-17 budgeted expenditures was carried over
to FY 2017-18, and there were $8 million in open encumbrances as of June 30, 2017.
The Community Facilities District (CFD) Number 1 Fund continues to collect assessments for the future construction of
city infrastructure and facilities.
The General Capital Construction (GCC) Fund used a portion of its existing fund balance to fund public beach access
improvements, finish the Dove Library remodeling project, the redesign of fire station #2.
The fund balance in the Infrastructure Replacement Fund (IRF) increased, as the city continued the annual transfer of
funds from the General Fund for the future replacement of existing infrastructure and facilities. During the year, several
projects were funded within the IRF, including city hall refurbishments and public beach access improvements.
The Park Development Fund and the Public Facilities Construction Fund (PFF) used a portion of their existing fund
balances for the completion Phase II of the Pine Avenue Park Community Center and Phase II of the Leo Carrillo Park
improvements.
During the year, the city continued to set aside money for the construction of various projects within these funds.
Historically, the city has not issued debt to fund the construction of capital projects, and sets aside funds on an annual
basis until sufficient funds have been collected for the construction of specific projects. In addition, projects will not be
constructed until anticipated annual operating costs can be absorbed into the city’s budget without creating a deficit.
Proprietary Funds
The purpose of the city’s proprietary funds is to provide short- and long-term financial information about the city’s
business-type activities. The analysis focuses on the determination of operating income, changes in net position (cost
recovery), financial position, and cash flows.
CMWD funds had an operating gain of approximately $345 thousand for the year. Operating revenues were
approximately $51.5 million and operating expenses were approximately $51.1 million. One of the larger factors in the
operating gain was the result of higher water sales. Water revenues increased due to a growth in water sales; a direct
35
correlation with reduced drought conservation measures. CMWD saw an 11 percent increase in water sales over the
prior fiscal year when Governor Brown eliminated the mandatory water reduction measures. The increase in sales,
coupled with the approval of water rate increases (5.25 percent in January 2016 and approximately 4.85 percent in
January 2017), led to higher water sale revenues. The cost of purchased water from the Metropolitan Water District and
the San Diego County Water Authority (suppliers of the CMWD’s potable water) continues to increase and, consequently,
CMWD rates must increase to cover the added cost. The increase in purchased water costs due to decreased drought
conservation efforts and the purchase of costlier desalinated water led to the $6 million increase in operating expenses.
Increases in operating expenses from purchased water reduced the operating gain, resulting in income before transfers
and capital contributions of $4.2 million.
In the eleventh year of operation, the Golf Course Fund had an operating loss of $2.6 million, primarily due to
depreciating the enterprise's assets ($3.6 million). If golf course operating revenues are not sufficient to cover golf course
operating expenses (excluding depreciation), the General Fund will make contributions in the form of lease payments to
pay for the shortfall. Since the General Fund advanced sufficient funds to the Golf Course in the prior fiscal year to pay
off their outstanding construction bonds, the General Fund did not need to make any lease payment to the fund in the
current fiscal year. In addition, food and beverage sales at the golf course restaurant (The Canyons) along with golf
revenues helped drive an $402,000 increase in operating revenues.
The Wastewater Funds had an annual operating gain of $370,000 for the fiscal year. Total revenues from operations
were up by $203,000. This was the net effect of an increase in charges for wastewater services partially offset by a
decrease in staff time charged to capital projects. The increase in operating expenses was predominantly due to a
decrease in staffing costs resulting from the reallocation of staff from the Wastewater operation to other operations, to
better reflect each operations workload. Non-operating revenues of $167,000 added to the operating income, resulting
in a net gain of $537,000 before transfers and capital contributions.
Solid Waste Operations and Storm Water Programs are combined on the city’s financial reports, and showed a net
operating income of $482,000 for the year. Revenues and expenses were essentially the same as the previous fiscal year.
Expenses for the year were also essentially the same as the previous fiscal year.
The unrestricted net position for the Water, Golf Course, Wastewater, and Solid Waste Operations at the end of the year
amounted to $87.8 million, or approximately 18 percent of the total enterprise funds net position. The unrestricted net
position may be used for rate stabilization, fluctuations in operating expenses, and unforeseen repairs and maintenance.
Approximately $39.5 million, or 8 percent, of the net position of all the proprietary funds are restricted for the future
capital construction of new and replacement water and wastewater infrastructure assets. Since the funding for the
replacement of infrastructure assets is not restricted, it is reflected in the Statement of Net Position as unrestricted. The
city does, however, account for and monitor these amounts in separate funds to ensure that water and wastewater
assets can be replaced when needed. The large unrestricted net position deficit balance in the Golf Course Fund
represents funds advanced from the city’s General Fund that were used to fund construction, former operating losses and debt expenses of the municipal golf course.
General Fund Budgetary Highlights for Fiscal Year 2017-18
Management monitors revenues during the year and updates estimated revenue figures when new information is
received. General Fund revenue estimates were revised moderately during the year, as compared to the originally
budgeted estimates. Some of the factors that led to the $5.1 million increase in revenue estimates included:
• several new federal and state grants were applied for and received during the year;
• increased sales tax revenues due to the reconstruction of the Shoppes at Carlsbad;
• increased transient occupancy taxes from the early opening on several new hotels in the city;
• additional development funded studies (miscellaneous revenues); and
• several new master planned communities and a spike in industrial/commercial development led to higher
building permit and associated revenues (licenses and permits, as well as charges for services).
36
The increase from the total original expenditure budget to the final budget amounted to $12.2 million primarily due to:
• the appropriation of grant money received;
• sales tax audit expenses;
• developer funded studies;
• the appropriation of mutual aid response overtime reimbursements received;
• Fire labor negotiations;
• additional unfunded litigation and expert expenses related to the Safety Training Center and the regional
airport environmental impact report;
• a mid-year budget transfer for costs associated with the General Fund’s share of storm drain maintenance;
and supplemental large payments made to CalPERS to help stabilize future retirement costs.
The difference between the final budgeted expenditures and the actual expenditures for the year (on a budgetary basis)
of $33.6 million can be generally summarized as follows:
• Interdepartmental charges were $11,000 below estimates, which are offset against expenditures for reporting purposes in the financial statements.
• $31.3 million in savings by various major service areas within the city. Current year savings were generated from:
o unfilled staff vacancies;
o overall awareness of fiscal responsibility throughout the city;
o deferral of projects; and
o accumulated savings set aside for future technology and innovation enhancements.
o Of the $31.3 million in savings, $29.3 million will be carried forward into FY 2018-19 and is planned to be used
for:
✓ a taser replacement program;
✓ graffiti trackers;
✓ K-9 narcotics training;
✓ police license plate readers;
✓ part-time assistance;
✓ citywide back file conversion scanning, quality control, and uploading of documents into the city’s Hewlett
Packard Records Management system;
✓ costs associated with new City Council members;
✓ office furniture and reconfigurations;
✓ Smart City initiatives;
✓ office equipment for new employees;
✓ process documentation costs associated with the city’s new permitting system;
✓ retail study;
✓ website enhancements;
✓ Wi-Fi services for Calavera Hills and Stagecoach Community Centers;
✓ a pilot program associated with short-term vacation rentals;
✓ professional services related to a citywide employee engagement survey;
✓ implementation and maintenance of a learning management system;
✓ library facility improvements;
✓ technology updates;
✓ cultural arts performance venue feasibility study;
✓ Poinsettia 61 traffic study outreach contracts;
✓ Engineering manual update;
✓ Public Works strategic plan;
✓ Public Works succession plan;
✓ Safety Training Center retrofitting and upgrades;
✓ utility billing system upgrade;
✓ timekeeping system upgrade;
37
✓ cashiering system upgrade;
✓ a new Enterprise Resource Planning system;
✓ continuing the implementation of the new permitting and business license system;
✓ minor building renovations at city facilities; and
✓ other one-time capital outlay items, as needed, throughout the city.
For purposes of budgetary presentation, actual revenues have been adjusted to exclude unrealized gains and losses in
investments pursuant to GASB; actual expenditures have been adjusted to include remaining encumbrances.
Capital Asset and Debt Administration
Capital Assets
At the end of Fiscal Year 2017-18, the city had recorded investments of over $1.1 billion in a broad range of capital assets,
including park facilities, land, buildings, roads, bridges, drainage facilities, water and sewer lines, police and fire vehicles,
and other maintenance equipment. This number includes infrastructure assets of the general government which are
required per GASB.
Some of this year’s major capital asset additions included:
• completion of the Pine Avenue Community Park facility and garden areas;
• installation of protective concrete barriers on the Carlsbad Blvd. bridge over the power plant discharge
channel;
• improvements to public beach access along Ocean Street;
• completion of the city hall refurbishment project;
• completion of various ADA (Americans with Disabilities Act) improvement projects including accessibility
improvements to sidewalks, curb ramps and pedestrian signals;
• expansion of the recycled water facility;
• Hilton Carlsbad Beach Resort donated assets (streets, waterlines, storm drains and street lighting);
• La Costa Town Square residential donated assets (streets, storm drains, sidewalks and street lighting);
• Tabata 10 donated assets (streets, wastewater and waterlines, sidewalks and street lighting);
• Fair Oaks Valley donated assets (streets storm drains, sidewalks and street lighting);
• 21 vehicles;
• a Police mobile command center;
Total
Percentage
Change Change
2017 2018 2017 2018 2017 2018 2017-18 2017-18
Land $153.1 $153.2 $9.4 $9.4 $162.5 $162.6 $0.1 0.1%
Construction in progress 7.8 10.0 44.2 41.6 52.0 51.6 (0.4) -0.8%
Buildings and other structures 123.7 135.9 40.7 41.0 164.4 176.9 12.5 7.6%
Improvements other than buildings 81.5 81.5 51.1 52.3 132.6 133.8 1.2 0.9%
Machinery and equipment 40.5 43.4 3.7 12.6 44.2 56.0 11.8 26.7%
Infrastructure 711.4 721.9 334.9 342.2 1,046.3 1,064.1 17.8 1.7%
Wastewater treatment facility - - 57.5 57.8 57.5 57.8 0.3 0.5%
Intangibles 5.0 5.0 - - 5.0 5.0 - 0.0%
1,123.0 1,150.9 541.5 556.9 1,664.5 1,707.8 43.3 2.6%
Accumulated depreciation (334.1) (357.2) (180.8) (192.4) (514.9) (549.6) (34.7) 6.7%
Total $788.9 $793.7 $360.7 $364.5 $1,149.6 $1,158.2 $8.6 0.7%
Activities Activities Total
CITY OF CARLSBAD'S CAPITAL ASSETS
(in millions of dollars)
Governmental Business-Type
38
• one GapVax Combination JetVac vehicle;
• one dump truck;
• two pieces of fire apparatus;
• three ambulances;
• several waterline projects; and
• several storm drain projects.
In addition to carrying forward appropriations of $198.6 million for previously budgeted projects, the city’s FY 2018-19
capital improvement budget appropriates an additional $66.2 million for capital projects.
These additional appropriations are principally for the following projects: beach access repair/upgrade from Pine Avenue
to Tamarack; widening of El Camino Real between Cassia Road and Camino Vida Roble and from Arenal Road to La Costa
Avenue; rehabilitation work at the Faraday Center; Safety Center building improvements; replacement of Fire Station
No. 2 and the Monroe Street Pool; synthetic turf at Stagecoach Park; the ongoing pavement management program;
analysis and conceptual alignments for two double-track railroad trench alternatives through the village area; continuing
the implementation of an adaptive traffic signal program and street lighting replacement program; traffic calming
measures and multiuse trail along Kelly Drive and Park Drive; additional water and recycled water lines; continuation of
the water valve repair/replacement program and the northwest quadrant storm drain improvement program; Park Drive
drainage and street improvements; improvements at the Encina Water Pollution Control Facility; access road
improvements at the Buena Interceptor Sewer; and wastewater line refurbishments/replacements at various locations
throughout the city.
These projects will be financed by development fees, infrastructure and replacement transfers from the General Fund,
special district fees and taxes, Water and Wastewater 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 and in the city’s Capital Improvement Program (CIP) document, which can be obtained from the
Administrative Services Department or found on the city’s website.
Long Term Debt
At year-end, the city had $15.5 million in capital leases and loans, a decrease of $1.2 million from last year, as shown in
the table above. Regular payments were made on all the city’s outstanding capital leases and loans, and the city made
a small additional draw on the loan with the State Water Resources Control Board. More detail about the city’s long-
term liabilities is presented in Note 7 to the financial statements.
Total
Percentage
Change
2017 2018 2017 2018 2017 2018 2017-18
Loans $0.0 $0.0 $15.9 $14.9 $15.9 $14.9 -6.3%
Capital leases 0.8 0.6 - - 0.8 0.6 -25.0%
Total $0.8 $0.6 $15.9 $14.9 $16.7 $15.5 -7.2%
Activities Activities Total
CITY OF CARLSBAD'S OUTSTANDING DEBT
(in millions of dollars)
Governmental Business-Type
39
Economic Factors and Next Year’s Budgets and Rates for Fiscal Year 2018-19
• The State of California adopted its FY 2018-19 Annual Budget with the following provisions affecting the city:
o Governor Brown signed a balanced state budget in June 2018 for FY 2018-19 using projected revenues of $133.3
billion to cover $138.7 billion in expenditures, using their $8.5 billion fund balance to bridge the difference. The
budget also includes increasing the state’s “rainy day” fund by $4.4 billion.
o In November 2014, California voters approved Proposition 2, which sets aside additional revenues, primarily
from capital gains, to address future economic downturns, instead of increasing ongoing expenditures. This set
aside is also referred to the “rainy day” fund.
o The budget recognizes that spending has increased markedly in the past five years, as California legislated an
increased in the minimum wage that will ultimately see $15 per hour and the expansion of healthcare for
millions of Californians.
o The budget does not capture the effect of federal tax legislation passed in December 2017, that will likely have
an impact on the state as Californians lose the ability to fully deduct state taxes on their federal income tax
returns.
o California voters approved to make permanent the income tax increases under Prop 30.
o Pension costs at the state level continue to escalate on an annual basis. To help mitigate this growing expense,
the state made a supplemental payment to CalPERS of $6 billion in FY 2017-18.
• Net assessed values in the city stand at over $33 billion, a 6.8 percent increase from the prior fiscal year, due to new
construction and escalating home and commercial property values.
• Sales tax revenues are projected to increase by 3.4 percent. A factor in the projected increase in sales tax revenues
are the newly renovated Shoppes at Carlsbad. Westfield (the former owner of the mall) sold this property in 2015.
The new owners (Rouse Properties) are in the final stages of a major renovation.
• The new LEGOLAND Hotel opened in May 2018, with 250 rooms. The Westin Hotel was projected to open in August
2018 with 141 new rooms, impacting transient occupancy revenues for the year.
• CalPERS is addressing a structural shortfall by lowering the discount rate used to determine the city’s annual pension
costs. The reduction in the discount rate is being phased in over several years. The impact in the FY 2018-19 budget
is a citywide increase in pension costs of 2.3 percent.
• Median home prices for single-family residences in Carlsbad have increased by 21 percent from the first quarter of
2017 ($814,000) to the first quarter of 2018 ($989,000).
• City departments were given maximum increases of 2.5 percent for maintenance and operational funding to cover
changes in the Consumer Price Index (CPI) and additional funding for existing contractual obligations.
• The city added 10 full-time positions, 3.5 part-time positions, eliminated 0.22 part-time positions, 3.0 limited-term
positions, and eliminated two full-time positions to better align staffing with the services the city provides.
• Through Memorandums of Understanding (MOUs):
o The Carlsbad City Employees’ Association (CCEA) will receive an allocated share of a 3.0 percent raise pool on
January 1, 2019.
o Fire and General Management employees will receive an allocated share of a 3.0 percent raise pool on January
1, 2019.
o Police Management employees will receive an allocated share of a 2.0 percent base raise on December 31, 2018.
o The Carlsbad Firefighters Association (CFA) will receive a 2.0 percent base raise on December 31, 2018.
o The Carlsbad Police Officers Association (CPOA) will receive a 3.8 percent raise on December 31, 2018.
These factors were considered when preparing the city’s General Fund budget for FY 2018-19. Budgeted expenditures
are expected to increase 6.9 percent to $155.8 million. The total personnel budget for FY 2018-19 is $92.9 million, which
is 2.7 percent more than the previous year’s personnel budget of $90.4 million. The total maintenance and operations
(M&O) budget for FY 2017-18 is $49.5 million, which is 15.9 percent higher than the previous year’s budget of $42.7
million. The increase in personnel budgets is based on previously negotiated salary and benefit increases, and the net
addition of 8.0 full-time and 3.28 part-time staff. Increases in retirement costs (CalPERS rates), health insurance rates,
and worker’s compensation rates also contributed to the increase in budgeted personnel costs. In addition to the 2.5
percent escalator provided for M&O costs, the FY 2018-19 budget included appropriations for an enhanced employee
40
engagement program, new operating costs for the Pine Avenue Community Center, the implementation of an integrated
pest management plan, an accounting change in capturing the utility billing costs incurred by the Finance department,
additional North County Dispatch costs, and increased construction and inspection management costs associated with
anticipated residential and commercial development projects. Transfers out of the General Fund are budgeted at $13.2
million, a $700,000 increase from the prior fiscal year. This increase is due primarily to increases in the transfers from
the General Fund to the IRF. Adding to the adopted budget of $155.8 million for the General Fund, approximately $29.3
million in unspent FY 2017-18 budgeted expenditures will be carried over to FY 2018-19, as well as $9.1 million in open
encumbrances as of June 30, 2018.
During the current fiscal year, the unassigned fund balance in the General Fund increased by $4.4 million to $82.6 million.
Although originally projected to grow by $9.2 million according to the FY 2017-18 adopted budget, the city made an
additional $11 million payment to CalPERS to help stabilize future retirement costs, of which $9.7 million was paid for by
the General Fund. This additional expenditure was completely offset by savings achieved in the General Fund due to
fiscal discipline, a large increase in assessed values (higher property taxes), the revamping of the Shoppes at Carlsbad
shopping center (higher sales taxes), a strong tourism season and two new hotels (increased TOT revenues), and higher
than anticipated development within the city (increased development related services and building permit revenues).
Based on FY 2018-19 projections, the unassigned General Fund balance is expected to grow by approximately $9.5
million.
The city took an additional step in FY 2014-15 to prepare to weather economic downturns. A General Fund set aside of $10 million was made by the City Council as an Economic Uncertainty Reserve, which can be used to shore up revenue
shortfalls during normal recessions. During FY 2015-16, the City Council took another step to help stabilize future
retirement costs (CalPERS rates) by assigning $10 million of the General Fund to assist in these efforts. After the
additional payment made to CalPERS in FY 2016-17, the CalPERS stability assignment is now $5.5 million.
Projected revenues are currently sufficient to build the projects listed in the FY 2018-19 CIP.
The city’s business-type activities reflect the following:
• The combined fixed and variable costs of water purchased from the San Diego County Water Authority are projected
to rise about 0.9 percent in total for FY 2018-19, the smallest increase in years. The San Diego Water Authority’s
actions, coupled with Carlsbad Municipal Water District reserves and demand patters, have enabled the Carlsbad
Municipal Water District to hold rates flat during FY 2018-19.
• No wastewater rate increases are proposed for calendar year 2019. Better than anticipated financial results in FY
2017-18 mitigated the need for a rate increase.
• The golf course bonds were paid off in September 2016. As a result, the operation will continue to see improvements
in their cash flows going forward.
• There are no projected significant changes in other revenue sources.
Contacting the City’s Financial Management
This financial report is designed to provide the citizens, taxpayers, customers, 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 Administrative Services Department,
1635 Faraday Avenue, Carlsbad, CA 92008, 760-602-2430, or visit us online at www.carlsbadca.gov.
41
June 30, 2018
Governmental Business-Type
ASSETS Activities Activities Total
Cash and investments 538,686,795 $ 190,481,503 $ 729,168,298 $
Receivables:
Interest 2,356,393 831,798 3,188,191
Taxes 10,152,551 33,539 10,186,090
Other 1,178,606 921,193 2,099,799
Accounts, net of allowances 136,491 11,217,301 11,353,792
Due from other governments 1,441,804 5,520,274 6,962,078
Inventories 414,066 808,530 1,222,596
Prepaid items 1,454 48,331 49,785
Loan and reimbursement receivables, net of allowances 21,987,153 - 21,987,153
Due from Successor Agency 9,103,922 - 9,103,922
Deposits 25,000 - 25,000
Internal balances 54,701,111 (54,701,111) -
Subtotal 640,185,346 155,161,358 795,346,704
Capital assets:
Land 153,172,352 9,375,975 162,548,327
Construction in progress 10,042,054 41,621,369 51,663,423
Buildings and other structures 135,956,852 40,933,226 176,890,078
Improvements other than buildings 81,453,044 52,278,030 133,731,074
Machinery and equipment 43,364,968 12,648,604 56,013,572
Infrastructure 721,892,857 342,229,972 1,064,122,829
Wastewater treatment facility - 57,806,075 57,806,075
Intangible assets 5,017,448 - 5,017,448
Less accumulated depreciation (357,222,349) (192,401,577) (549,623,926)
Total capital assets 793,677,226 364,491,674 1,158,168,900
Total assets 1,433,862,572 519,653,032 1,953,515,604
DEFERRED OUTFLOWS OF RESOURCES
Deferred outflows of resources - OPEB related items 507,114 353,780 860,894
Deferred outflows of resources - pension related items 59,828,935 5,287,447 65,116,382
Total deferred outflows of resources 60,336,049 5,641,227 65,977,276
The notes to the financial statements are an integral part of this statement.
Primary Government
Statement of Net Position
42
June 30, 2018
Governmental Business-Type
LIABILITIES Activities Activities Total
Accrued liabilities 14,855,090 $ 4,636,174 $ 19,491,264 $
Accrued interest payable - 65,449 65,449
Due to other governments 701 8,983,519 8,984,220
Estimated claims payable 10,865,432 - 10,865,432
Deposits payable 528,441 3,332,289 3,860,730
Unearned revenue 1,461,483 76,178 1,537,661
Noncurrent liabilities:
Net OPEB liability 1,511,001 980,620 2,491,621
Net pension liability 167,367,726 13,977,806 181,345,532
Due within one year 209,285 1,546,234 1,755,519
Due in more than one year 378,296 13,397,697 13,775,993
Total liabilities 197,177,455 46,995,966 244,173,421
DEFERRED INFLOWS OF RESOURCES
Deferred inflows of resources - OPEB related items 231,881 120,052 351,933
Deferred inflows of resources - pension related items 5,618,003 531,836 6,149,839
Total deferred inflows of resources 5,849,884 651,888 6,501,772
NET POSITION
Net investment in capital assets 793,089,645 349,547,743 1,142,637,388
Restricted for:
Capital assets 182,811,642 39,522,358 222,334,000
Lighting and landscaping districts 7,306,710 - 7,306,710
Affordable housing 41,500,601 - 41,500,601
Habitat and agricultural mitigation management 1,639,808 - 1,639,808
Other purposes 2,799,733 - 2,799,733
Unrestricted 262,023,143 88,576,304 350,599,447
Total net position 1,291,171,282 $ 477,646,405 $ 1,768,817,687 $
The notes to the financial statements are an integral part of this statement.
Primary Government
Statement of Net Position (Continued)
43
Statement of Activities
For the Year Ended June 30, 2018
Operating Capital
Charges for Grants and Grants and
Functions/Programs Expenses Services Contributions Contributions
Primary government:
Governmental activities:
General government 25,189,484 $ 815,665 $ 1,331,705 $ 563 $
Public safety 62,629,764 4,804,953 402,843 -
Community services 51,897,194 11,588,119 8,215,026 2,649,177
Public works 36,874,639 3,768,308 3,103,860 20,343,328
Interest and fiscal charges on long-term debt 5,072 - - -
Total governmental activities 176,596,153 20,977,045 13,053,434 22,993,068
Business-type activities:
Carlsbad Municipal Water District 51,658,312 50,094,530 1,393,114 4,016,478
Golf course 10,559,709 7,973,024 - -
Wastewater 13,494,856 13,885,284 63,268 1,467,585
Solid waste 3,089,166 3,427,083 154,948 -
Total business-type activities 78,802,043 75,379,921 1,611,330 5,484,063
Total primary government 255,398,196 $ 96,356,966 $ 14,664,764 $ 28,477,131 $
General revenues:
Property taxes
Sales and use taxes
Transient occupancy taxes
Franchise taxes
Business license taxes
Real property transfer taxes
Income from property and investments
Other general revenues
Transfers
Total general revenues and transfers
Change in net position
Net position at beginning of year, as restated
Net position at end of year
The notes to the financial statements are an integral part of this statement.
Program Revenues
44
Governmental Business-type
Activities Activities Total
(23,041,551) $ -$ (23,041,551) $
(57,421,968) - (57,421,968)
(29,444,872) - (29,444,872)
(9,659,143) - (9,659,143)
(5,072) - (5,072)
(119,572,606) - (119,572,606)
- 3,845,810 3,845,810
- (2,586,685) (2,586,685)
- 1,921,281 1,921,281
- 492,865 492,865
- 3,673,271 3,673,271
(119,572,606) 3,673,271 (115,899,335)
66,523,809 3,742,902 70,266,711
33,674,164 - 33,674,164
24,233,536 - 24,233,536
5,812,542 - 5,812,542
5,025,692 - 5,025,692
1,463,148 - 1,463,148
2,551,347 985,844 3,537,191
518,650 2,568 521,218
(136,511) 136,511 -
139,666,377 4,867,825 144,534,202
20,093,771 8,541,096 28,634,867
1,271,077,511 469,105,309 1,740,182,820
1,291,171,282 $ 477,646,405 $ 1,768,817,687 $
Primary Government
Changes in Net Position
Net Revenue (Expense) and
45
Balance Sheet
Governmental Funds
June 30, 2018
Community General
General Facilities Capital
ASSETS Fund District No. 1 Construction
Cash and investments 123,268,115 $ 81,926,931 $ 45,497,174 $
Receivables:
Interest 760,293 359,751 -
Taxes 10,150,206 2,345 -
Other 987,207 - -
Accounts, net of allowances 119,311 - -
Due from other governments 118,269 - -
Inventories 17,644 - -
Prepaid items - - -
Loans receivable, net of allowances 85,542 - -
Deposits 25,000 - -
Due from Successor Agency 9,103,922 - -
Advances to other funds 55,712,190 1,973,013 -
Total assets 200,347,699 $ 84,262,040 $ 45,497,174 $
LIABILITIES
Accrued liabilities 5,501,539 $ 41,429 $ 553,060 $
Deposits payable 63,047 - -
Due to other governments 451 - -
Advances from other funds - - -
Unearned revenue 1,243,110 - -
Total liabilities 6,808,147 41,429 553,060
DEFERRED INFLOWS OF RESOURCES
Unavailable revenue - sales tax 1,161,508 - -
Unavailable revenue - grants 33,124 - -
Unavailable revenue - interest on advances 13,291,466 - -
Total deferred inflows of resources 14,486,098 - -
FUND BALANCES
Nonspendable 51,627,832 - -
Restricted - 84,220,611 -
Committed 1,000,000 - -
Assigned 43,855,106 - 44,944,114
Unassigned 82,570,516 - -
Total fund balances 179,053,454 84,220,611 44,944,114
Total liabilities, deferred inflows of
resources, and fund balances 200,347,699 $ 84,262,040 $ 45,497,174 $
The notes to the financial statements are an integral part of this statement.
46
Public Other Total
Infrastructure Park Facilities Governmental Governmental
Replacement Development Construction Funds Funds
106,259,223 $ 11,379,252 $ 28,769,103 $ 95,184,223 $ 492,284,021 $
466,937 54,517 121,854 415,913 2,179,265
- - - - 10,152,551
- - - 191,399 1,178,606
- - 5,657 - 124,968
- - - 1,323,535 1,441,804
- - - - 17,644
- - - 1,454 1,454
- - - 21,901,611 21,987,153
- - - - 25,000
- - - - 9,103,922
- - 5,650,000 - 63,335,203
106,726,160 $ 11,433,769 $ 34,546,614 $ 119,018,135 $ 601,831,591 $
363,762 $ 83,382 $ 396,361 $ 3,051,136 $ 9,990,669 $
- - - 464,394 527,441
- - - 250 701
- 5,650,000 - 2,158,295 7,808,295
- - - 218,373 1,461,483
363,762 5,733,382 396,361 5,892,448 19,788,589
- - - - 1,161,508
- - - 1,138,444 1,171,568
- - - - 13,291,466
- - - 1,138,444 15,624,542
- - - 1,454 51,629,286
- 5,700,387 34,150,253 111,985,789 236,057,040
- - - - 1,000,000
106,362,398 - - - 195,161,618
- - - - 82,570,516
106,362,398 5,700,387 34,150,253 111,987,243 566,418,460
106,726,160 $ 11,433,769 $ 34,546,614 $ 119,018,135 $ 601,831,591 $
47
Reconciliation of the Balance Sheet of Governmental Funds
to the Statement of Net Position
June 30, 2018
Total fund balances - governmental funds.566,418,460 $
Amounts reported for governmental activities in the statement of net position are different because:
Capital assets used in governmental activities are not financial resources and, therefore, are not
reported in the funds.
Governmental funds 780,830,840
Internal service funds 12,846,386
Total capital assets 793,677,226
Deferred outflows are not an available resource and therefore, are not reported in the funds.
Governmental funds 57,974,702
Internal service funds 2,361,347
Total deferred outflows 60,336,049
Internal service funds are used by management to charge the costs of fleet management, self insured
benefits, 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 position.
Total internal service fund net position 37,401,893
Adjustment to reflect the consolidation of internal service fund activities related to enterprise funds.(825,797)
Internal service fund net position included as part of total capital assets (12,846,386)
Internal service fund net position included as part of deferred outflows (2,361,347)
Internal service fund net position included as part of long-term liabilities 8,548,937
Internal service fund net position included as part of deferred inflows 513,897
Net internal service fund net position 30,431,197
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.13,291,466
A portion of the taxes receivable is not available to pay for current-period expenditures and, therefore,
is not recognized in the funds.1,161,508
A portion of deferred grant revenues and contributions from property owners are not available to pay for
current-period expenditures and therefore, are not recognized in the funds.1,171,568
Long-term liabilities, including net pension liability, are not due and payable in the current period and
therefore, are not reported in the funds.
Governmental funds (160,917,371)
Internal service funds (8,548,937)
Total long-term liabilities (169,466,308)
Deferred inflows represent an acquisition of net position that applies to a future period so it will not be
recognized until that time.
Governmental funds (5,335,987)
Internal service funds (513,897)
Total deferred inflows (5,849,884)
Net position of governmental activities.1,291,171,282 $
The notes to the financial statements are an integral part of this statement.
48
This
p
a
g
e is intentionally left blank.
49
Statement of Revenues, Expenditures and Changes in Fund Balances
Governmental Funds
For the Year Ended June 30, 2018
Community General
General Facilities District Capital
Fund No. 1 Construction
Revenues:
Taxes 136,256,971 $ 1,773,402 $ -$
Intergovernmental 1,307,393 - -
Licenses and permits 2,999,177 - -
Charges for services 10,032,388 - -
Fines and forfeitures 671,641 - -
Income from property and investments 3,009,718 247,825 -
Contributions from property owners - 773,985 423,659
Donations - - -
Miscellaneous 1,366,125 - -
Total revenues 155,643,413 2,795,212 423,659
Expenditures:
Current:
General government 25,876,832 88,581 -
Less: interdepartmental charges (3,159,562) - -
Public safety 58,046,347 - -
Community services 38,597,637 - -
Public works 15,884,890 - -
Capital outlay - 295,889 3,122,730
Debt service:
Principal retirement 9,746 - -
Interest and fiscal charges 2,536 - -
Total expenditures 135,258,426 384,470 3,122,730
Excess (deficiency) of revenues
over (under) expenditures 20,384,987 2,410,742 (2,699,071)
Other financing sources (uses):
Transfers in 184,400 - -
Transfers out (12,896,727) - -
Total other financing sources (uses)(12,712,327) - -
Net change in fund balances 7,672,660 2,410,742 (2,699,071)
Fund balances at beginning of year 171,380,794 81,809,869 47,643,185
Fund balances at end of year 179,053,454 $ 84,220,611 $ 44,944,114 $
The notes to the financial statements are an integral part of this statement.
50
Public Other Total
Infrastructure Park Facilities Governmental Governmental
Replacement Development Construction Funds Funds
-$ -$ -$ 3,087,527 $ 141,117,900 $
- - - 10,300,591 11,607,984
- - - - 2,999,177
- - - 4,112,643 14,145,031
- - - 7,364 679,005
388,061 42,380 240,204 693,867 4,622,055
- 1,377,792 5,128,305 5,194,269 12,898,010
- - - 331,882 331,882
- - - 624,918 1,991,043
388,061 1,420,172 5,368,509 24,353,061 190,392,087
- - - 660,050 26,625,463
- - - - (3,159,562)
- - - 521,303 58,567,650
- - - 10,441,023 49,038,660
- - - 1,335,213 17,220,103
3,346,454 1,889,970 8,820,647 9,409,665 26,885,355
- - - - 9,746
- - - 4,356 6,892
3,346,454 1,889,970 8,820,647 22,371,610 175,194,307
(2,958,393) (469,798) (3,452,138) 1,981,451 15,197,780
9,970,000 - - 1,359,249 11,513,649
- - - (693,649) (13,590,376)
9,970,000 - - 665,600 (2,076,727)
7,011,607 (469,798) (3,452,138) 2,647,051 13,121,053
99,350,791 6,170,185 37,602,391 109,340,192 553,297,407
106,362,398 $ 5,700,387 $ 34,150,253 $ 111,987,243 $ 566,418,460 $
51
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, 2018
Net change in fund balances - total governmental funds.13,121,053 $
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 18,987,136
Depreciation expense (22,318,233)
Governmental funds do not reflect the donation of capital assets as revenues.6,110,382
Unpaid interest income on advances to other funds is not a current financial resource, and therefore is
not recognized as revenue in the funds.182,541
A portion of the sales tax receivable and grant revenues are not available to pay for current-period
to pay for current-period expenditures and therefore, are not recognized in the funds.745,781
The issuance of long-term debt (e.g., leases) provides current financial resources to governmental funds,
the repayment of the principal of long-term debt consumes the current financial resources of
governmental funds.9,746
The net revenue of activities of internal service funds is reported with governmental activities.2,314,819
Adjustments made to the net pension and net OPEB liabilities do not use current financial resources
and therefore, are not recognized in the funds.1,094,810
Adjustment to reflect the consolidation of internal service fund activities related to enterprise funds.(154,264)
Change in net position of governmental activities.20,093,771 $
The notes to the financial statements are an integral part of this statement.
52
General Fund
Variance With
Final Budget -
Actual Amounts Over
Original Final (Budgetary Basis)(Under)
Revenues:
Taxes 133,113,000 $ 136,370,000 $ 136,256,971 $ (113,029) $
Intergovernmental 908,280 967,000 1,307,393 340,393
Licenses and permits 2,216,000 3,144,000 2,999,177 (144,823)
Charges for services 8,334,000 9,109,000 10,032,388 923,388
Fines and forfeitures 736,000 600,000 671,641 71,641
Income from property and investments 4,144,000 4,147,000 4,979,128 832,128
Miscellaneous 881,000 1,057,000 1,366,125 309,125
Total revenues 150,332,280 155,394,000 157,612,823 2,218,823
Expenditures:
Current:
General government 37,159,625 46,306,550 28,382,912 (17,923,638)
Less: interdepartmental charges (3,149,359) (3,149,000) (3,159,562) (10,562)
Public safety 61,874,234 63,540,155 58,730,131 (4,810,024)
Community services 45,769,327 46,895,157 41,983,036 (4,912,121)
Public works 21,852,924 22,092,710 18,413,896 (3,678,814)
Total expenditures 163,506,751 175,685,572 144,350,413 (31,335,159)
Excess (deficiency) of revenues over (under)
expenditures (13,174,471) (20,291,572) 13,262,410 33,553,982
Other financing sources (uses):
Transfers in 10,000 184,400 184,400 -
Transfers out (12,455,000) (12,896,727) (12,896,727) -
Total other financing sources (uses)(12,445,000) (12,712,327) (12,712,327) -
Net change in fund balances (25,619,471) (33,003,899) 550,083 33,553,982 $
Fund balance at beginning of year 171,380,794 171,380,794 171,380,794
Fund balance at end of year 145,761,323 $ 138,376,895 $ 171,930,877 $
The notes to the financial statements are an integral part of this statement.
Budgeted Amounts
For the Year Ended June 30, 2018
Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
53
Statement of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual
General Fund (Continued)
For the Year Ended June 30, 2018
Actual Amounts
(Budgetary Basis)
Revenues
Actual amounts (budgetary basis) “available for appropriation” from
the budgetary comparison schedule (previous page).157,612,823 $
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.(1,969,410)
155,643,413 $
Expenditures
Actual amounts (budgetary basis) “total charges to appropriations”
from the budgetary comparison schedule (previous page).144,350,413 $
Differences - budget to GAAP:
Encumbrances are shown in the year encumbered for budgetary purposes,
but in the year paid for financial reporting purposes.(9,091,987)
135,258,426 $
The notes to the financial statements are an integral part of this statement.
BUDGET-TO-GAAP RECONCILIATION
54
This
p
a
g
e is intentionally left blank.
55
Statement of Net Position
Proprietary Funds
June 30, 2018
Carlsbad
Municipal Golf
ASSETS Water District Course Wastewater
Current assets:
Cash and investments 127,353,647 $ 2,304,518 $ 47,015,402 $
Receivables:
Interest 559,739 4,795 206,514
Taxes 33,539 - -
Other - 337,524 715
Accounts, net of allowances 8,299,981 - 2,107,455
Due from other governments 351,060 2,012 5,167,202
Inventories 609,891 186,693 11,946
Prepaid items 23,881 24,450 -
Total current assets 137,231,738 2,859,992 54,509,234
Capital assets:
Land 1,905,206 4,841,667 2,629,102
Construction in progress 11,364,486 - 30,256,883
Buildings and other structures 20,762,775 20,170,451 -
Improvements other than buildings 2,322,549 42,820,657 7,134,824
Machinery and equipment 10,841,423 1,475,225 331,956
Infrastructure 229,096,526 - 113,133,446
Wastewater treatment facility - - 57,806,075
Intangible assets - - -
Less accumulated depreciation (78,846,938) (33,199,856) (80,354,783)
Total capital assets (net of accumulated
depreciation)197,446,027 36,108,144 130,937,503
Total noncurrent assets 197,446,027 36,108,144 130,937,503
Total assets 334,677,765 38,968,136 185,446,737
DEFERRED OUTFLOWS OF RESOURCES
Deferred outflows of resources - OPEB related items 326,883 - 15,956
Deferred outflows of resources - pension related items 3,299,129 - 1,376,501
Total deferred outflows of resources 3,626,012 - 1,392,457
The notes to the financial statements are an integral part of this statement.
Business-Type Activities -
56
Governmental
Enterprise Funds Activities -
Internal
Solid Service
Waste Totals Funds
13,807,936 $ 190,481,503 $ 46,402,774 $
60,750 831,798 177,128
- 33,539 -
582,954 921,193 -
809,865 11,217,301 11,523
- 5,520,274 -
- 808,530 396,422
- 48,331 -
15,261,505 209,862,469 46,987,847
- 9,375,975 -
- 41,621,369 -
- 40,933,226 -
- 52,278,030 -
- 12,648,604 28,431,379
- 342,229,972 -
- 57,806,075 -
- - 1,689,637
- (192,401,577) (17,274,630)
- 364,491,674 12,846,386
- 364,491,674 12,846,386
15,261,505 574,354,143 59,834,233
10,941 353,780 27,125
611,817 5,287,447 2,334,222
622,758 5,641,227 2,361,347
(Continued)
57
Statement of Net Position
Proprietary Funds (Continued)
June 30, 2018
Carlsbad
Municipal Golf
LIABILITIES Water District Course Wastewater
Current liabilities:
Accrued liabilities 1,947,777 534,700 1,190,242
Accrued interest payable 65,449 - -
Due to other governments 6,739,584 - 2,243,935
Estimated claims payable - - -
Current portion of long-term debt 1,546,234 - -
Total current liabilities 10,299,044 534,700 3,434,177
Noncurrent liabilities:
Deposits payable 147,139 663,061 2,522,089
Advance from other funds - 55,526,908 -
Unearned revenue 34,623 - 10,000
Net OPEB liability 900,477 - 47,542
Net pension liability 8,327,637 - 3,675,155
Capital lease payable - - -
Loans payable 13,397,697 - -
Total noncurrent liabilities 22,807,573 56,189,969 6,254,786
Total liabilities 33,106,617 56,724,669 9,688,963
DEFERRED INFLOWS OF RESOURCES
Deferred inflows of resources - OPEB related items 107,753 - 7,296
Deferred inflows of resources - pension related items 289,757 - 179,701
Total deferred inflows of resources 397,510 - 186,997
NET POSITION
Net investment in capital assets 182,502,096 36,108,144 130,937,503
Restricted for:
Capital assets 31,805,487 - 7,716,871
Unrestricted 90,492,067 (53,864,677) 38,308,860
Total net position (deficit)304,799,650 $ (17,756,533) $ 176,963,234 $
Adjustment to reflect the consolidation of internal service fund activities related to enterprise funds.
Net position of business-type activities
The notes to the financial statements are an integral part of this statement.
Business-Type Activities -
58
Governmental
Enterprise Funds Activities -
Internal
Solid Service
Waste Totals Funds
963,455 4,636,174 4,864,421
- 65,449 -
- 8,983,519 -
- - 10,865,432
- 1,546,234 198,810
963,455 15,231,376 15,928,663
- 3,332,289 1,000
- 55,526,908 -
31,555 76,178 -
32,601 980,620 80,823
1,975,014 13,977,806 7,910,237
- - 359,067
- 13,397,697 -
2,039,170 87,291,498 8,351,127
3,002,625 102,522,874 24,279,790
5,003 120,052 12,403
62,378 531,836 501,494
67,381 651,888 513,897
- 349,547,743 12,288,509
- 39,522,358 -
12,814,257 87,750,507 25,113,384
12,814,257 $ 476,820,608 37,401,893 $
825,797
477,646,405 $
59
Statement of Revenues, Expenses and Changes in Net Position
Proprietary Funds
For the Year Ended June 30, 2018
Carlsbad
Municipal Golf
Water District Course Wastewater
Operating revenues:
Water sales 49,340,070 $ -$ -$
Wastewater service charges - - 13,885,284
Golf course operations - 7,973,024 -
Other charges for services 754,460 - -
Miscellaneous 1,393,114 - 63,268
Total operating revenues 51,487,644 7,973,024 13,948,552
Operating expenses:
Encina plant operations 1,026,920 - 3,551,757
Purchased water 25,926,711 - -
Golf course operations - 6,991,761 -
Depreciation 5,160,704 3,566,933 4,002,289
Fuel and supplies - - -
Claims and premiums expense - - -
Small equipment purchases - - -
General and administrative 19,027,871 - 6,024,561
Total operating expenses 51,142,206 10,558,694 13,578,607
Operating income (loss)345,438 (2,585,670) 369,945
Nonoperating revenues (expenses):
Income from property and investments 719,750 48,428 167,316
Miscellaneous - 515 -
Interest expense and fees (575,627) (1,015) -
Gain (loss) on sale of property 980 1,073 -
Property taxes 3,742,902 - -
Total nonoperating revenues (expenses)3,888,005 49,001 167,316
Income (loss) before transfers and capital
contributions 4,233,443 (2,536,669) 537,261
Transfers in - - -
Transfers out - - (82,000)
Capital contributions:
Capital restricted fees and grants 3,188,828 - 1,080,094
Developer constructed assets 827,650 - 387,491
Other - - -
Change in net position 8,249,921 (2,536,669) 1,922,846
Total net position (deficit) at beginning of year, as restated 296,549,729 (15,219,864) 175,040,388
Total net position (deficit) at end of year 304,799,650 $ (17,756,533) $ 176,963,234 $
Adjustment to reflect the consolidation of internal service fund activities related to enterprise funds.
Changes in net position of business-type activities
The notes to the financial statements are an integral part of this statement.
Business-Type Activities -
60
Governmental
Activities -
Internal
Solid Waste Totals Service Funds
-$ 49,340,070 $ -$
- 13,885,284 -
- 7,973,024 -
3,427,083 4,181,543 19,257,385
154,948 1,611,330 150,945
3,582,031 76,991,251 19,408,330
- 4,578,677 -
- 25,926,711 -
- 6,991,761 -
- 12,729,926 2,342,286
- - 1,275,921
- - 6,601,563
- - 980,960
3,100,158 28,152,590 9,148,440
3,100,158 78,379,665 20,349,170
481,873 (1,388,414) (940,840)
50,350 985,844 150,833
- 515 -
- (576,642) (39,745)
- 2,053 68,737
- 3,742,902 -
50,350 4,154,672 179,825
532,223 2,766,258 (761,015)
218,511 218,511 1,940,216
- (82,000) -
- 4,268,922 -
- 1,215,141 -
- - 1,135,618
750,734 8,386,832 2,314,819
12,063,523 35,087,074
12,814,257 $ 37,401,893 $
154,264
8,541,096 $
Enterprise Funds
61
Statement of Cash Flows
Proprietary Funds
For the Year Ended June 30, 2018
Carlsbad
Municipal Golf
Water District Course Wastewater
Cash flows from operating activities:
Receipts from customers and users 49,438,735 $ 7,792,726 $ 13,758,837 $
Payments to suppliers (36,362,623) (6,966,029) (2,674,743)
Payments to employees (5,708,979) - (2,356,683)
Internal activity - payments to other funds (2,561,852) - (1,321,072)
Claims and premiums paid - - -
Other receipts 123,971 66,952 1,052,931
Net cash provided (used) by operating activities 4,929,252 893,649 8,459,270
Cash flows from noncapital financing activities:
Operating subsidies and transfers from other funds - - -
Insurance reimbursement - 515 -
Advances to other funds - (108,979) -
Net cash provided (used) by capital and
related financing activities - (108,464) -
Cash flows from capital and related financing activities:
Proceeds from capital debt 553,302 - -
Capital restricted fees 1,957,789 - 1,080,094
Purchase of capital assets (6,448,909) (329,473) (9,743,610)
Gross proceeds from the sale of capital assets 980 1,073 -
Principal paid on capital debt (1,510,433) - -
Interest and other fees paid (366,049) - -
Proceeds from state and local grants 1,231,039 - -
Property taxes received 3,736,673 - -
Net cash (used in) capital and related financing
activities (845,608) (328,400) (8,663,516)
Cash flows from investing activities:
Interest on investments 580,367 47,473 122,316
Net increase (decrease) in cash and cash equivalents 4,664,011 504,258 (81,930)
Cash and cash equivalents at beginning of year 122,689,636 1,800,260 47,097,332
Cash and cash equivalents at end of year 127,353,647 $ 2,304,518 $ 47,015,402 $
The notes to the financial statements are an integral part of this statement.
Business-Type Activities -
62
Governmental
Activities -
Internal
Solid Waste Totals Service Funds
3,374,843 $ 74,365,141 $ 19,403,891 $
(1,389,873) (47,393,268) (6,691,440)
(1,280,603) (9,346,265) (4,915,726)
(639,143) (4,522,067) (216,361)
- - (6,224,103)
154,948 1,398,802 -
220,172 14,502,343 1,356,261
218,511 218,511 1,940,216
- 515 -
- (108,979) -
218,511 110,047 1,940,216
- 553,302 -
- 3,037,883 -
- (16,521,992) (3,261,747)
- 2,053 97,917
- (1,510,433) (187,223)
- (366,049) (39,745)
- 1,231,039 -
- 3,736,673 -
- (9,837,524) (3,390,798)
35,210 785,366 112,205
473,893 5,560,232 17,884
13,334,043 184,921,271 46,384,890
13,807,936 $ 190,481,503 $ 46,402,774 $
(Continued)
Enterprise Funds
63
Statement of Cash Flows
Proprietary Funds (Continued)
For the Year Ended June 30, 2018
Carlsbad
Municipal Golf
Water District Course Wastewater
Reconciliation of operating income (loss) to net cash
provided by operating activities:
Operating income (loss)345,438 $ (2,585,670) $ 369,945 $
Adjustments to reconcile operating income (loss) to
net cash provided by (used in) operating activities:
Depreciation and amortization 5,160,704 3,566,933 4,002,289
Change in assets and liabilities:
(Increase) decrease in receivables (655,795) (180,298) (126,447)
(Increase) decrease in due from other governments 475,802 - 3,688,115
(Increase) decrease in deposits - (2,012) -
(Increase) decrease in inventories (61,113) (23,103) 2,363
(Increase) decrease in prepaid items (2,711) (24,450) -
(Increase) decrease in deferred outflows - OPEB related items (326,883) - (15,956)
(Increase) decrease in deferred outflows - pension related items (1,157,119) - (525,250)
(Decrease) increase in accrued liabilities (200,628) 75,297 (88,785)
(Decrease) increase in due to other governments 91,509 17,287 (200,185)
(Decrease) increase in estimated claims payable - - -
(Decrease) increase in deposits payable 4,837 49,665 989,663
(Decrease) increase in unearned revenue - - -
(Decrease) increase in net OPEB liability (16,213) - 9,089
(Decrease) increase in net pension liability 974,276 - 368,993
(Decrease) increase in deferred inflows - OPEB related items 107,753 - 7,296
(Decrease) increase in deferred inflows - pension related items 189,395 - (21,860)
Net cash provided by operating activities 4,929,252 $ 893,649 $ 8,459,270 $
Noncash capital financing activities:
Capital assets contributed by other sources 827,650 $ -$ 387,491 $
The notes to the financial statements are an integral part of this statement.
Business-Type Activities -
64
Governmental
Activities -
Internal
Solid Waste Totals Service Funds
481,873 $ (1,388,414) $ (940,840) $
- 12,729,926 2,342,286
(51,978) (1,014,518) (4,439)
- 4,163,917 -
- (2,012) -
- (81,853) (3,808)
- (27,161) -
(10,941) (353,780) (27,125)
(166,324) (1,848,693) (500,645)
13,329 (200,787) (123,844)
- (91,389) -
- - 469,984
- 1,044,165 -
(262) (262) -
6,234 (890) 15,453
(20,084) 1,323,185 395,368
5,003 120,052 12,403
(36,678) 130,857 (278,532)
220,172 $ 14,502,343 $ 1,356,261 $
-$ 1,215,141 $ 1,135,618 $
Enterprise Funds
65
Statement of Net Position
Fiduciary Funds
June 30, 2018
Private
Purpose
Agency Trust
ASSETS Funds Funds
Current assets:
Cash and investments 21,186,985 $ 1,200,340 $
Receivables:
Interest 139,686 13,826
Taxes 4,030 -
Other 34,932 -
Prepaid items 2,639 -
Total current assets 21,368,272 1,214,166
Noncurrent assets:
Loans receivable - 3,750,000
Restricted assets:
Cash and investments 5,124,822 -
Total noncurrent assets 5,124,822 3,750,000
Total assets 26,493,094 $ 4,964,166 $
LIABILITIES
Current liabilities:
Accrued liabilities 864,483 $ 2,211 $
Accrued interest payable - 93,280
Deposits held for others 25,628,611 -
Current portion of long-term debt - 775,000
Total current liabilities 26,493,094 870,491
Noncurrent liabilities:
Due to the City of Carlsbad - 9,103,922
Tax allocation bonds payable - 4,520,000
Total noncurrent liabilities - 13,623,922
Total liabilities 26,493,094 14,494,413
NET POSITION
Held in trust for redevelopment obligation retirement purposes -$ (9,530,247) $
The notes to the financial statements are an integral part of this statement.
66
Statement of Changes in Net Position
Fiduciary Funds
For the Fiscal Year Ended June 30, 2018
Private
Pupose
Trust
ADDITIONS Funds
Contributions:
Tax increment 3,589,291 $
Income from property and investments 15,011
Total additions 3,604,302
DEDUCTIONS
General and administrative 127,988
Community development 484,398
Interest expense and fees 469,394
Total deductions 1,081,780
Change in net position 2,522,522
Total net position (deficit) at beginning of year (12,052,769)
Total net position (deficit) at end of year (9,530,247) $
The notes to the financial statements are an integral part of this statement.
67
Notes to the Financial Statements
68
Note 1. Summary of Significant Accounting Policies
The City of Carlsbad, California (“city”), was incorporated on July 16, 1952. The city was a general law city until 2008,
when the citizens in Carlsbad voted and approved the city to become a charter city. The city operates under a
Council-Manager form of government and provides the following services: general government, public safety,
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 Public Financing Authority and the Carlsbad
Municipal Water District (CMWD). The city does not issue separate financial statements for these component units.
Since the City Council serves as the governing board for these component units and there is either a financial
benefit/burden relationship between the component unit and city or the management of the city has the operational
responsibility for the component unit, 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.
Government-wide and Fund Financial Statements
The Government-wide Financial Statements (i.e., the Statement of Net Position and the Statement of Activities)
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.
Notes to the Financial Statements
69
Note 1. Summary of Significant Accounting Policies (continued)
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.
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 Private Purpose Trust 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, as long as the expenditure reflects a near-term
cash outflow. Principal and interest on long-term debt are recorded as fund liabilities when due.
Revenues that are accrued generally include real property taxes, sales tax, transient occupancy taxes (TOT), franchise
taxes, 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 (National Council on Government Accounting) 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.
Agency funds, which are a type of fiduciary funds, are custodial in nature (assets equal liabilities) and do not involve
the recording of city revenues and expenses. Since revenues and expenses are not recognized, agency funds have
no measurement focus, however, 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 Community Facilities District (CFD) No. 1 capital project fund is used to account for the receipt of taxes
and fees charged to developers that are restricted for civic facilities, parks, and road segments.
• The General Capital Construction (GCC) 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 Infrastructure Replacement (IRF) capital project fund is used to account for transfers from the General
Fund and expenditures for the replacement of major infrastructure throughout the city.
Notes to the Financial Statements
70
Note 1. Summary of Significant Accounting Policies (continued)
• The Park Development Fund capital project funds are used to account for receipts of fees charged to
developers for park acquisition and development.
• The Public Facilities Construction (PFF) capital project fund is used to account for the receipt of fees
charged to developers, and expenditures that are restricted for specific public facilities such as parks and fire stations necessitated by growth.
The city reports the following major enterprise funds:
• The Carlsbad Municipal Water District enterprise funds are used to account for the operation,
maintenance, and capital facility financing of the city’s potable and recycled water systems.
• The Golf Course enterprise fund is used to account for revenues and expenses for the construction,
maintenance and operating activities of the city’s municipal golf course.
• The Wastewater enterprise funds are used to account for the operation, maintenance, and capital facility
financing of the city’s wastewater system.
• The Solid Waste enterprise funds are used to account for the revenues and expenses of the city’s solid
waste source-reduction, recycling and storm water programs.
Additionally, the city reports the following fund types:
• Internal Service funds account for fleet maintenance and replacement, self-insured benefits, information
technology, risk management and workers’ compensation services provided to other departments or
agencies of the city.
• The Agency funds account for assets held by the city for other 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.
• The Trust funds account for the activities of the Redevelopment Obligation Retirement Funds, which
accummulates resources for obligations previously incured by the former City of Carlsbad Redevelopment
Agency (RDA).
As a general rule, the effect of interfund activity has been eliminated from the Government-wide Financial
Statements. An exception to this general rule are the charges between CMWD 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.
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. When expenditures are incurred for purposes for which both
restricted and unrestricted (committed, assigned, or unassigned) fund balances are available, restricted revenue will
be applied first. When expenditures are incurred for purposes for which committed, assigned, or unassigned fund
balances are available, the policy is to apply committed fund balance first, then assigned fund balance and finally
unassigned fund balance.
Notes to the Financial Statements
71
Note 1. Summary of Significant Accounting Policies (continued)
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 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
Compensated absences are comprised of vacation payable for all city employees, banked overtime (comp time) and
vested sick benefits for certain former district employees. Vacation pay and comp time are payable to employees
at the time used or upon termination of employment. For governmental funds, the cost of accumulated vacation
and comp time expected to be paid in the next 12 months is recorded as a liability in the Self-Insured Benefits internal
service fund. Since the city caps the amount of vacation and comp time employees are allowed to have on the books
at any point in time, for compensated absences recorded at June 30, 2018, all balances are expected to be paid
within the following 12 months. For proprietary funds, the cost of vacation and comp time is recorded as a liability
when earned.
Risk management
The city accounts for its general liability, self-insured dental, 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.
Unbilled services
Unbilled water, wastewater and solid waste revenues of the enterprise funds are recognized as earned when the
services are used.
Notes to the Financial Statements
72
Note 1. Summary of Significant Accounting Policies (continued)
Capital assets
Capital assets, which include land (including right-of-way), buildings, equipment and infrastructure assets (e.g.,
roads, bridges, traffic signals, water and wastewater 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 machinery and equipment and capital construction with an initial, individual cost of more than
$10,000 and an estimated useful life in excess of one year; and intangible assets such as computer software with an
initial cost of more than $100,000, 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
acquisition 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 capital 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 10 – 50
Machinery and equipment 3 – 20
Infrastructure 10 – 100
Wastewater treatment facility (including equipment)
Intangible assets
5 – 75
5 – 10
The city has capitalized all general infrastructure assets acquired or constructed. In addition the land upon which
the streets and roads are constructed (right-of-way) has also been valued and capitalized.
Unearned revenue
The unearned revenue reported in the city’s financial statements represents money received during the current or
previous fiscal years that has not been earned by 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.
Deferred outflows
In addition to assets, the statement of financial position reports a separate section for deferred outflows of
resources. This separate financial statement element, deferred outflows of resources, represents a consumption of
net position that applies to a future period(s) and so will not be recognized as an outflow of resources
(expense/expenditure) until then. The city has pension-related and other postemployment benefits related (OPEB)
items in this category.
Deferred inflows
In addition to liabilities, the statement of financial position reports a separate section for deferred inflows of
resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of
net position that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until
that time. The city has two types of items that qualify for reporting in this category.
Notes to the Financial Statements
73
Note 1. Summary of Significant Accounting Policies (continued)
The first item, unavailable revenue, is reported only in the governmental funds balance sheet. The governmental
funds report unavailable revenues from three sources: interest on advances, sales taxes and grants. This amount is
deferred and recognized as an inflow of resources in the period that the amount becomes available.
The second item, deferred inflows of resources, is reported in the proprietary funds balance sheet and the Statement
of Net Position. The city has pension related and OPEB related items in this category.
Interfund transactions
Activity between funds that is representative of lending/borrowing arrangements outstanding at the end of the fiscal
year is referred to as either “due to/from other funds” (short-term interfund loans), “advances to/from other funds”
(long-term interfund loans) or “due from Successor Agency” (long-term trust fund loan). Any residual balances
outstanding between the governmental activities and business-type activities are reported in the Government-wide
Financial Statements as “internal balances.”
The portion of fund balance associated with amounts that have been disbursed to other funds in the form of long-
term interfund advances have been classified as nonspendable unless the funds associated with repayment of the
advance are otherwise restricted for a specific purpose.
Receivables and payables
All trade, service and tax receivables are shown net of an allowance for uncollectibles. The utility billing receivable
allowance is equal to two percent of outstanding billings at June 30, 2018, the ambulance billing receivable allowance
is equal to 40 percent of outstanding billings at June 30, 2018, and the trade and false alarm receivable allowance is
equal to the total of all outstanding receivables that are over 90 days past due plus 30 percent of all remaining
balances. The only exceptions to these rules are receivables that were subsequently paid or were known to be
collectible at year-end, which were not reserved for at June 30, 2018, and any receivables due from other public
agencies.
Loan and reimbursement receivable
The accompanying financial statements reflect the recording of certain loans receivable that represent loans made
to various organizations and individuals. In certain cases, the amount of collection is dependent upon future residual
receipts to be generated by the property or contingent upon the ability of the owner to sell the property at an
amount sufficient to pay all liens against the property, including the obligation to the city. All loan and
reimbursement receivables are shown net of an allowance for uncollectibles.
Encumbrances
Encumbrance accounting, under which purchase orders, contracts and other commitments for the expenditure of
monies are recorded in order to reserve that portion of the applicable appropriation, is employed as an extension
of formal budgetary control in the governmental funds. Unexpended and unencumbered 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.
Notes to the Financial Statements
74
Note 1. Summary of Significant Accounting Policies (continued)
Net position
Net position represents the differences between assets and deferred outflows, and liabilities and deferred inflows.
Net investment in capital assets, consist of capital assets, net of accumulated depreciation, reduced by the
outstanding balances of any borrowings, used for the acquisition, construction or improvement of those assets. Net
investment in capital assets, excludes unspent debt proceeds. Net position is reported as restricted when there are
limitations imposed on its use either through the enabling legislation adopted by the city or through external
restrictions imposed by creditors, grantors, or laws or regulations of other governments. It is the city’s policy to
consider restricted net position to have been depleted before unrestricted net position is applied.
Cash flows
Statements of cash flows are presented for proprietary fund types. Cash and cash equivalents include all unrestricted
and restricted highly liquid investments with original purchase maturities of three months or less. Pooled cash and
investments in the city’s Treasury represent monies in a cash management pool and such accounts are similar in
nature to demand deposits.
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 Position.
Pensions
For purposes of measuring the net pension liability, deferred outflows and inflows of resources related to pensions,
and pension expense, information about the fiduciary net position of the city’s California Public Employees’
Retirement System (CalPERS) plans (Plans) and additions to/deductions from the fiduciary net position have been
determined on the same basis as they are reported by CalPERS. For this purpose, benefit payments (including
refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms.
Investments are reported at fair value.
For this report, the following timeframes are used:
Valuation Date (VD) June 30, 2016
Measurement Date (MD) June 30, 2017
Measurement Period (MP) July 1, 2016 to June 30, 2017
Other Postemployment Benefits (OPEB)
For purposes of measuring the net OPEB liability, deferred outflows of resources and deferred inflows of resources
related to OPEB, and OPEB expense, information about the fiduciary net position of the city’s plan (OPEB Plan), the
assets of which are held by the California Employers’ Retiree Benefit Trust (CERBT), and additions to/deductions
from the OPEB Plan’s fiduciary net position have been determined by an independent actuary. For this purpose,
benefit payments are recognized when currently due and payable in accordance with the benefit terms. Investments
are reported at fair value.
Notes to the Financial Statements
75
Note 1. Summary of Significant Accounting Policies (continued)
Generally accepted accounting principles require that the reported results must pertain to liability and fiduciary net
position information within certain defined timeframes. For this report, the following timeframes are used:
Valuation Date (VD) June 30, 2016
Measurement Date (MD) June 30, 2017
Measurement Period (MP) July 1, 2016 to June 30, 2017
Fair Value Measurements
Certain assets and liabilities are required to be reported at fair value. The fair value framework provides a hierarchy
that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority
to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest
priority to unobservable inputs (Level 3 measurements). The three levels of fair value hierarchy are described as
follows:
Level 1 – Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active
markets.
Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either
directly or indirectly, and fair value is determined through the use of models or other valuation methodologies
including:
• Quoted prices for similar assets or liabilities in active markets;
• Quoted prices for identical or similar assets or liabilities in markets that are inactive;
• Inputs other than quoted prices that are observable for the asset or liability; and
• Inputs that are derived principally from or corroborated by observable market data by correlation or other
means.
Level 3 – Inputs to the valuation methodology are unobservable and significant to the fair value measurement. These unobservable inputs reflect the city’s own assumptions about the inputs market participants would use in pricing
the asset or liability (including assumptions about risk). These unobservable inputs are developed based on the best
information available in the circumstances and may include the city’s own data.
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, and increases in General Liability and Workers’ Compensation Fund claims expenses. The city
manager is authorized to increase or decrease an appropriation for a specific purpose where the appropriation is
Notes to the Financial Statements
76
Note 2. Budgetary Data (continued)
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.
For purposes of budgetary presentation, actual revenues have been adjusted to exclude unrealized gains and losses
pursuant to GASB. Actual expenditures have been adjusted to include encumbrances outstanding. Annual budgets
are adopted for the General Fund, special revenue funds except for the Tyler Court Apartments Fund, and a portion
of the Parking-in-Lieu Capital Project Fund (Grants and Other Capital Project Funds). Accordingly, the revenues and
expenditures for the Tyler Court Apartments Fund have been excluded from the budget basis financial statements.
Annual operating budgets are not adopted for the capital projects funds except for the Parking-in-Lieu Fund;
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 Statement (IPS), which is reviewed by the Investment Review Committee and adopted
annually by the City Council. All investments held in the Treasurer’s Pool are consistent with the city’s IPS 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 five types of
risk: custodial (investments and cash deposits), concentration, default, event, and market or interest rate risk.
The city and its agencies invest a portion of the funds in an external investment pool known as the Local Agency
Investment Fund (LAIF). Management and oversight are the responsibility of the California State Treasurer. As of
June 30, 2018, the LAIF performance report shows a fair value factor of 0.998126869. The city’s position in the LAIF
pool is calculated as a percentage of the fair value of the city’s shares to the fair value of the pooled shares.
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.
Notes to the Financial Statements
77
Note 3. Deposit and Investment Risk (continued)
As of June 30, 2018, the city had the following investments in its portfolio:
Fair Market % of Modified
Treasurer's Pool investments Value Total Duration
U.S. agencies:
United States Treasury Bills & Notes 104,292,448 $ 13.9% 2.126
Federal Home Loan Mortgage Corporation 91,137,785 12.2% 2.820
Federal National Mortgage Association 83,706,632 11.2% 1.448
Federal Home Loan Bank 76,494,437 10.2% 2.271
Federal Farm Credit Bank 75,915,863 10.1% 2.204
Federal Agricultural Corporation 14,968,695 2.0% 2.027
Supranational 11,698,326 1.6% 3.268
Refunding Corporation 9,106,473 1.2% 1.029
Financing Corporation 9,065,887 1.2% 1.018
Tennessee Valley Authority 7,264,362 1.0% 1.991
RFCO Strip Principal 2,821,530 0.4% 2.262
Subtotal U.S. agencies 486,472,438 65.0%2.129
Corporate notes:
Medium-term corporate notes 156,037,526 20.9% 2.250
Subtotal corporate notes 156,037,526 20.9%2.250
LAIF 85,606,347 11.4%-
Certificates of deposit 15,040,784 2.0% 2.297
Cash accounts 4,956,700 0.7%-
Total Treasurer’s Pool 748,113,795 100.0% 1.942
Investments held outside the Treasurer’s Pool
Money market funds 4,528,136
Guaranteed investment contracts 2,475,412
Subtotal debt service funds/bond proceeds 7,003,548
Other deposits 1,550,977
Petty cash funds 12,125
Total cash and investments 756,680,445 $
Statement of Net Position, Primary Government
Cash and investments 729,168,298 $
Statement of Net Position, Fiduciary Funds
Cash and investments 22,387,325
Restricted cash and investments 5,124,822
Total cash and investments 756,680,445 $
Notes to the Financial Statements
78
Note 3. Deposit and Investment Risk (continued)
Fair Value Measurement
The city categorizes its fair value investments within the fair value hierarchy established by generally accepted
accounting principles. The city has the following recurring fair value measurements as of June 30, 2018:
Level 1 Level 2 Level 3 Total
U.S. Treasury Bills & Notes 104,292,448 $ -$ -$ 104,292,448 $
Refunding Corporation - 9,106,473 - 9,106,473
Federal Agency securities - 373,073,517 - 373,073,517
Medium-term corporate notes - 156,037,526 - 156,037,526
Certificates of Deposit - 15,040,784 - 15,040,784
Total Investments Reported at Fair Value 104,292,448 553,258,300 - 657,550,748
Cash accounts - - - 4,956,700
LAIF - - - 85,606,347
Money market funds - - - 4,528,136
Guaranteed investment contracts - - - 2,475,412
Other deposits - - - 1,550,977
Petty cash funds - - - 12,125
Total cash and investments 104,292,448 $ 553,258,300 $ -$ 756,680,445 $
Fair Value Hierarchy
Custodial credit risk (investments)
The city uses a third-party bank for its 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 the custodian’s
failure. All city investments held in custody and safekeeping 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. Investments are settled
on Delivery vs. Payment (DVP) in accordance with the third party custodial agreement.
Custodial credit risk (deposits)
The city maintains cash accounts at one major banking institution. At the conclusion of each business day, balances
in these accounts are “swept” into overnight pooled investments, which are pooled into funds collateralized with
U.S. government securities (guaranteed) or U.S. agency securities (government-sponsored). The California Code
authorizes both of these types of investments. Amounts up to $250,000 are Federal Deposit Insurance Corporation
(FDIC) insured. All funds in non-interest-bearing transaction accounts are fully insured under the Dodd-Frank Wall
Street Reform and Consumer Protection Act.
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 percent of the portfolio.
Notes to the Financial Statements
79
Note 3. Deposit and Investment Risk (continued)
For concentration of investments, the city’s IPS requires that no more than five percent of investments in corporate
notes be in any one issuer. There is no similar requirement in either the state code or the city’s IPS for U.S. agencies.
As of June 30, 2018, the portfolio was in compliance with this requirement.
Default credit risk
Default credit risk is the risk that the issuer of the security does not pay either the interest or principal when due.
Debts of most U.S. agencies are not backed by the full faith and credit of the federal government. These agencies
are U.S. government-sponsored. In August 2011, Standard and Poor’s Investor’s Service downgraded U.S. long term
debt one step to AA+. Competing agencies, Moody’s Investors Service and Fitch Ratings, maintained their AAA rating
on U.S. debt. Although the default credit risk of these investments has increased, the city believes the risk of default
remains low.
California state code limits investments in medium-term corporate notes to the top three credit ratings (AAA, AA,
and A). However, it is the city’s policy to limit investments to the top two credit ratings (AAA and AA). As of June 30,
2018, approximately 2.61 percent of the investments in medium-term corporate notes did not have one of these
two credit ratings. These investments were made when the credit ratings were AA or higher. California state code
and the city’s IPS allow the city treasurer to determine the course of action to correct exceptions to the IPS. 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 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 purchase requirements.
The LAIF is an external investment pool managed by the California State Treasurer. Its investments are short-term
and follow the investment requirements of the State. LAIF is not rated; however, the city treasurer considers the
default credit risk of LAIF to be minimal.
Money market funds held by bond trustees are rated AAA. Investment contracts held by bond trustees are not rated
by rating agencies.
The table below is the minimum rating (where applicable) of the California state code, the city’s investment policy,
or debt agreements, and the actual rating at June 30, 2018 for each investment type by Standard & Poor’s Investor’s
Service:
Minimum Exempt Rating as of Year End
Legal from Not
Investment Type Total Rating Disclosure AAA AA A Rated
Treasury securities 104,292,448$ N/A 104,292,448$ -$ -$ -$ -$
Federal agency securities 382,179,990 N/A - - 382,179,990 - -
Medium term notes 156,037,526 AA - 34,116,273 102,779,552 19,141,701 -
Local Agency Investment Fund (LAIF)85,606,347 N/A - - - - 85,606,347
Certificates of deposit 15,040,784 N/A - - - - 15,040,784
Cash accounts 4,956,700 N/A - - - - 4,956,700
Other deposits 1,550,977 N/A - - - - 1,550,977
Petty cash funds 12,125 N/A - - - - 12,125
Investments with fiscal agent
Money market funds 4,528,136 AA-m - 4,528,136 - - -
Guaranteed investment contracts 2,475,412 N/A - - - - 2,475,412
756,680,445$ 104,292,448$ 38,644,409$ 484,959,542$ 19,141,701$ 109,642,345$
Notes to the Financial Statements
80
Note 3. Deposit and Investment Risk (continued)
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, 2018, the portfolio had a 1.67 percent loss in
market value based on cost.
The city’s IPS 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 liquid
investments (LAIF and bank accounts) and investments maturing within one year to be equal to an amount that is
not less than two-thirds of the current fiscal year’s operating budget. The city met those requirements as follows:
1. As of June 30, 2018, the modified duration of the portfolio was 1.911. Modified duration is a prospective
measure of the sensitivity of a fixed-income security’s value to changes in market rates of interest. Modified
duration identifies the potential gain/loss in value before it actually occurs. For example, a modified
duration of 1.5 indicates that when and if a one percent change in market interest rates occurs, a 1.5
percent change in the security’s value will result. Investments with modified durations of one to three are
considered to be relatively conservative.
2. As of June 30, 2018, maturities within one year exceeded the required minimum of $171,800 (two-thirds of
current year operating budget for the city per the Fiscal Year 2017-18 Operating Budget adopted by the City
Council).
3. As of June 30, 2018, the weighted average maturity of the LAIF underlying debt securities was 193 days. As
of June 30, 2018, LAIF had a 0.1873 percent loss in market value.
4. As of June 30, 2018, the city’s investment portfolio included $27,351,000 of callable step-up notes at par.
Note 4. Due To and From Other Funds
The city had no amounts that were due from funds within the city to other funds within the city at June 30, 2018.
Notes to the Financial Statements
81
Note 5. Advances To and From Other Funds
The following table shows amounts advanced from governmental funds within the city to other funds within the city
at June 30, 2018:
Advances To Amount
General Fund Other Governmental Funds:
Habitat Mitigation 185,282$ (1)
General Fund Enterprise Funds:
Golf Course 55,526,908 (2)
Other Governmental Funds: Other Governmental Funds:
CFD No. 1 Traffic Impact Projects 1,973,013 (3)
Public Facilities Construction Park Development 5,650,000 (4)
63,335,203$
General Fund Fiduciary Funds:
Redevelopment Obligation
Retirement Trust Funds 9,103,922$ (5)
Advances From
Advances to and from other funds are primarily long term advances used to fund capital projects in advance of
related revenues.
(1) The advance between the General Fund and the Habitat & Agricultural Management Fund is estimated to be
repaid from future Habitat Mitigation Fees. Interest on the advance will compound annually at the average
interest rate earned by the Treasurer’s Pool during the fiscal year.
(2) The advance between the General Fund and the Golf Course Enterprise Fund is estimated to be repaid through
residual operating income from golf course operations.
(3) The advance between the CFD No. 1 Fund and the Traffic Impact Projects Fund is estimated to be repaid over a
10-15 year period as Traffic Impact Fees are collected.
(4) The advance between the PFF Fund and the Park Development Funds is estimated to be repaid at build-out.
(5) The obligation of the Redevelopment Obligation Retirement Trust Funds represents the obligations of the
custodian of the assets and liabilities of the former redevelopment agency (the Successor Agency) and is presented in the accompanying financial statements as Due from Successor Agency. Interest on the obligation
will compound annually at three percent per Health and Safety Code Section 34191.4 which was amended by
Senate Bill No. 107. Senate Bill No. 107 went into effect in September 2015.
Notes to the Financial Statements
82
Note 6. Capital Assets
Capital asset activity was as follows for the year ended June 30, 2018:
Balance at Balance at
June 30, 2017 Increases Decreases June 30, 2018
Governmental activities:
Capital assets, not being depreciated:
Land (including right-of-way)153,098,487$ 73,865$ -$ 153,172,352$
Construction in progress 7,774,678 4,988,804 (2,721,428) 10,042,054
Total capital assets,
not being depreciated 160,873,165 5,062,669 (2,721,428) 163,214,406
Capital assets, being depreciated:
Buildings 123,742,120 12,214,732 - 135,956,852
Improvements, other than buildings 81,453,044 - 81,453,044
Machinery and equipment 40,432,960 4,506,770 (1,574,762) 43,364,968
Infrastructure 711,444,588 10,448,269 - 721,892,857
Intangible assets 5,017,448 - - 5,017,448
Total capital assets,
being depreciated 962,090,160 27,169,771 (1,574,762) 987,685,169
Less accumulated depreciation for:
Buildings (37,353,981) (2,730,349) - (40,084,330)
Improvements, other than buildings (27,461,895) (3,434,548) - (30,896,443)
Machinery and equipment (25,228,625) (2,927,382) 1,538,497 (26,617,510)
Infrastructure (241,646,085) (14,979,365) - (256,625,450)
Intangible assets (2,409,742) (588,874) - (2,998,616)
Total accumulated
depreciation (334,100,328) (24,660,518) 1,538,497 (357,222,349)
Total capital assets
being depreciated, net 627,989,832 2,509,253 (36,265) 630,462,820
Governmental activities
capital assets, net 788,862,997$ 7,571,922$ (2,757,693)$ 793,677,226$
Notes to the Financial Statements
83
Note 6. Capital Assets (continued)
Balance at Balance at
June 30, 2017 Increases Decreases June 30, 2018
Business-type activities:
Capital assets, not being depreciated:
Land (including right-of-way)9,375,975$ -$ -$ 9,375,975$
Construction in progress 44,229,764 12,192,934 (14,801,329) 41,621,369
Total capital assets,
not being depreciated 53,605,739 12,192,934 (14,801,329) 50,997,344
Capital assets, being depreciated:
Buildings 40,705,081 228,145 - 40,933,226
Improvements, other than buildings 51,121,786 1,156,244 - 52,278,030
Machinery and equipment 3,711,152 10,119,433 (1,181,981) 12,648,604
Infrastructure 334,925,558 7,304,414 - 342,229,972
Wastewater treatment facility 57,521,662 284,413 - 57,806,075
Total capital assets,
being depreciated 487,985,239 19,092,649 (1,181,981) 505,895,907
Less accumulated depreciation for:
Buildings (9,403,916) (1,029,841) - (10,433,757)
Improvements, other than buildings (31,290,200) (3,219,716) - (34,509,916)
Machinery and equipment (2,659,255) (358,374) 1,181,981 (1,835,648)
Infrastructure (102,342,900) (6,631,887) - (108,974,787)
Wastewater treatment facility (35,157,361) (1,490,108) - (36,647,469)
Total accumulated
depreciation (180,853,632) (12,729,926) 1,181,981 (192,401,577)
Total capital assets
being depreciated, net 307,131,607 6,362,723 - 313,494,330
Business-type activities
capital assets, net 360,737,346$ 18,555,657$ (14,801,329)$ 364,491,674$
Notes to the Financial Statements
84
Note 6. Capital Assets (continued)
Depreciation expense was charged to functions/programs of the primary government as follows:
Governmental activities:
General government 1,216,611$
Public safety 1,351,348
Community services 4,450,011
Public works 15,300,262
Capital assets held by the internal service funds
(charged to various functions based on
their usage of the assets)2,342,286
Total depreciation expense - governmental activities 24,660,518$
Business-type activities:
Carlsbad Municipal Water District 5,160,704$
Wastewater 4,002,289
Golf course 3,566,933
Total depreciation expense - business-type activities 12,729,926$
Note 7. Long-term Debt
The following is a summary of changes in the principal balance of long-term debt for the year ended June 30, 2018:
Principal Principal
Balance at Balance at Due Within
July 1, 2017 Increases Decreases June 30, 2018 One Year
Governmental activities:
Obligations under capital lease 784,549 $ -$ 196,968 $ 587,581 $ 209,285 $
Total governmental
activities 784,549 $ -$ 196,968 $ 587,581 $ 209,285 $
Principal Principal
Balance at Balance at Due Within
July 1, 2017 Increases Decreases June 30, 2018 One Year
Business-type activities:
Loans payable 15,901,063 $ 553,302 $ 1,510,434 $ 14,943,931 $ 1,546,234 $
Total business type
activities 15,901,063 $ 553,302 $ 1,510,434 $ 14,943,931 $ 1,546,234 $
Notes to the Financial Statements
85
Note 7. Long-term Debt (continued)
Long-term debt at June 30, 2018 is comprised of the following issues:
Balance at
Governmental long-term debt June 30, 2018
The city has entered into several office equipment lease-purchase agreements. As of
June 30, 2018 the city has not purchased any of the copier equipment. All lease terms
are for 60 months, with interest rates ranging from 6.0% to 7.2%587,581 $
Sub-total governmental long-term debt 587,581
Less current portion (209,285)
Total long-term portion of governmental debt 378,296 $
Balance at
Business-type long-term debt June 30, 2018
2005 Carlsbad Municipal Water District loan agreement with the State Water Resources
Control Board totaling $9,694,504. Principal is due in varying amounts ranging from
$544,180 to $631,082 on June 1 of each year through 2025, interest payable on June 1 each
year at 2.5% per annum. Payable from recycled water user fees.4,107,163$
2006 Carlsbad Municipal Water District loan agreement with the State Water Resources
Control Board totaling $19,382,546. Principal is due in varying amounts ranging from
$1,002,054 to $1,201,978 on April 1 of each year through 2027, interest payable on April 1
of each year at 2.3% per annum. Payable from recycled water user fees. 9,894,287
2014 Carlsbad Municipal Water District loan agreement, as revised, with the State Water Resources
Control Board authorized to $22,150,000. Principal and interest will not be due until December 2021.
Interest is payable on December 31 each year at 1.0% per anum. Principal due under the current
amortiztion schedule ranges from $27,223 to $36,330. Payable from recycled water user fees.942,481
Subtotal business-type long-term debt 14,943,931
Less current portion (1,546,234)
Total long-term portion of business-type debt 13,397,697 $
Notes to the Financial Statements
86
Note 7. Long-term Debt (continued)
The aggregate maturities of long-term debt are as follows:
Year ended June 30:Principal Interest
2019 209,285 $ 29,965 $
2020 222,373 16,877
2021 155,923 3,578
587,581 $ 50,420 $
Year ended June 30:Principal Interest
2019 1,546,234 $ 330,248 $
2020 1,582,886 293,595
2021 1,620,408 256,074
2022 1,686,045 227,131
2023 1,725,642 187,533
2024-2028 6,036,613 359,062
2029-2033 148,884 34,581
2034-2038 156,480 26,986
2039-2043 164,461 19,004
2044-2048 172,850 10,617
2049-2051 103,428 2,165
14,943,931 $ 1,746,996 $
Business-type Activities
Governmental Activities
The aggregate maturities for the business-type activities reflect a new $942,481 water loan. The city is currently
drawing down loan proceeds from an authorized $22.1 million for the expansion of the recycled water facility. The
loan amount will continue to adjust as future draws are made.
Note 8. Rate Covenants and Pledged Revenue
Rate covenants
The 2005 CMWD loan agreement with the State Water Resources Control Board requires that CMWD set its charges
for services and rates for fees each year at rates sufficient to produce net revenues (after paying the operating and
maintenance expenses of CMWD, excluding depreciation) of at least one times debt service for that year. All of the
revenues of CMWD are pledged to meet these rate covenants and to secure related debt. All rate covenants
requirements were met for the fiscal year ended June 30, 2018.
Notes to the Financial Statements
87
Note 8. Rate Covenants and Pledged Revenue (continued)
Pledged revenue
The city has a number of debt issuances outstanding that are collateralized by the pledging of certain revenues. The
purpose for which the proceeds of the related debt issuances were utilized are disclosed in the debt descriptions of
the accompanying notes. For the current year, debt service payments as a percentage of the pledged gross revenue
(net of certain expenses where so required by the debt agreement) are indicated in the table below. These
percentages also approximate the relationship of debt service to pledged revenues for the remainder of the term of
the commitment:
Debt Service as a
Description of Pledged Annual Amount of Pledged Annual Debt Service Percentage of Pledged
Revenue Revenue (net of expenses)Payments Revenue
Recycled water revenues 4,310,449$ 1,876,482$ 44%
Note 9. Debt without Government Commitment
In the opinion of city officials, the bonds listed below 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, the State of California, nor any political subdivision
thereof, is obligated to the payment of the principal or interest on the bond. Accordingly, no liability has been
recorded in the accompanying financial statements.
Limited obligation improvement bonds
As of June 30, 2018, the city has three series of assessment district bonds outstanding in the amount of $37,195,000.
These bonds were issued under the provisions of the Improvement Bond Act of 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 districts’ agency funds.
Special tax bonds
As of June 30, 2018, the city has two series CFD bonds outstanding in the amount of $20,525,000. These bonds were
issued under the provisions of the Mello-Roos Community Facilities Act of 1982 and were used to finance public
infrastructure improvement projects. The city collects special taxes to pay the bond debt. These monies are
accounted for in the CFDs’ 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, 2018 is $20,191,464.
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.
Notes to the Financial Statements
88
Note 10. Fund Balances
The following is a summary of the components of fund balances as of June 30, 2018:
Community General
Facilities Capital Infrastructure
Fund Balances General District No. 1 Construction Replacement
Nonspendable:
Inventory 17,644 $ -$ -$ -$
Prepaid items - - - -
Loans receivable 85,542 - - -
Due from Successor Agency*4,245,253 - - -
Advances to other funds*47,279,393 - - -
Totals 51,627,832 - - -
Restricted for:
Affordable housing - - - -
Lighting and landscaping districts - - - -
Habitat and agricultural mitigation/preservation - - - -
Capital projects - 84,220,611 - -
General government - - - -
Public safety - - - -
Community services - - - -
Totals - 84,220,611 - -
Committed to:
Community activity grants 1,000,000 - - -
Totals 1,000,000 - - -
Assigned to:
CalPERS stability 5,500,000 - - -
General government 20,653,756 - - -
Public safety 5,864,471 - - -
Community services 7,406,149 - - -
Public works 4,430,730 - - -
Capital projects - - 44,944,114 106,362,398
Totals 43,855,106 - 44,944,114 106,362,398
Unassigned:
Unassigned 72,570,516 - - -
Economic uncertainty 10,000,000 - - -
Totals 82,570,516 - - -
Total fund balances 179,053,454 $ 84,220,611 $ 44,944,114 $ 106,362,398 $
Governmental Funds
Notes to the Financial Statements
89
Public Other
Park Facilities Governmental
Development Construction Funds Total
-$ -$ -$ 17,644 $
- - 1,454 1,454
- - - 85,542
- - - 4,245,253
- - - 47,279,393
- - 1,454 51,629,286
- - 41,499,147 41,499,147
- - 7,306,710 7,306,710
- - 1,639,808 1,639,808
5,700,387 34,150,253 58,740,391 182,811,642
- - 662,443 662,443
- - 292,594 292,594
- - 1,844,696 1,844,696
5,700,387 34,150,253 111,985,789 236,057,040
- - - 1,000,000
- - - 1,000,000
- - - 5,500,000
- - - 20,653,756
- - - 5,864,471
- - - 7,406,149
- - - 4,430,730
- - - 151,306,512
- - - 195,161,618
- - - 72,570,516
- - - 10,000,000
- - - 82,570,516
5,700,387 $ 34,150,253 $ 111,987,243 $ 566,418,460 $
Governmental Funds
Notes to the Financial Statements
90
Note 10. Fund Balances (continued)
* Only reflects that portion of fund balance invested in interfund advances and loans (the General Fund amount is
net of $13,291,466 in unavailable revenue for measurable but unavailable interest earned on such advances and
loans).
Fund balances are reported in the fund statements in the following classifications:
Nonspendable Fund Balance
Nonspendable Fund Balance – this includes amounts that cannot be spent because they are either not
spendable in form (such as inventory) or legally or contractually required to be maintained intact (such as
endowments).
Spendable Fund Balance
Restricted Fund Balance – this includes amounts that can be spent only for specific purposes stipulated by
constitution, external resource providers, or through enabling legislation. If the City Council action limiting
the use of funds is included in the same action (legislation) that created (enables) the funding source, then
it is restricted.
Committed Fund Balance – this includes amounts that can be used only for the specific purposes
determined by a formal action of the City Council. It includes legislation (council action) that can only be
overturned by new legislation requiring the same type of voting consensus that created the original action.
Therefore, if the council action limiting the use of the funds is separate from the action (legislation) that
created (enables) the funding source, then it is committed, not restricted. The city considers a resolution
to constitute the formal action of the City Council that is necessary to commit fund balance.
Assigned Fund Balance – this includes amounts that are designated or expressed by the City Council, but
does not require a formal action like a resolution or ordinance. The City Council has not delegated to any
other persons or bodies the authority to assign fund balance to specific purposes. The City Council has
authorized, through a resolution, that all outstanding encumbrances at the end of the fiscal year, certain
unspent budgeted amounts to be carried forward into the next fiscal year, and has set aside funds to
stabilize future pension costs. These amounts are shown as assigned fund balance at the end of the fiscal
year:
• CalPERS stability – the City Council has set assigned these funds to be used to address fluctuating
CalPERS rates caused by volatile market conditions. The assignment has defined parameters that will
determine when and how much will be used to stablize CalPERS rates.
• General government – citywide back file conversion scanning, quality control, and uploading of
documents into the city’s Hewlett packard Records Management system; costs associated with new
City Council members; office furniture and reconfigurations; Smart City initiatives; professional services
related to a citywide employee engagement survey; implementation and maintenance of a learning
management system; Utility billing system upgrade; timekeeping system upgrade; cashiering system
upgrade; a new Enterpise Resource Planning system; continuing the implementation of the new
permitting and business license system; and additional part-time employees.
• Public safety – a taser replacement program; graffiti trackers; K-9 narcotics training; police license plate
readers; new office furniture and space renovations; and additional part-time employees.
Notes to the Financial Statements
91
Note 10. Fund Balances (continued)
• Community services – website enhancements; office furniture and reconfigurations; part-time staff
assistance; process documentation costs associated with the city’s new permitting system; a retail
study; Wi-Fi Services for Calavera Hills and Stagecoach Community Centers; a pilot program associated
with short-term vacation rentals; library facility improvements; technology updates; and a cultural arts
performance venue feasibility study.
• Public works – Poinsettia 61 traffic study outreach contracts; Engineering manual update; Public Works
strategic plan; Public Works succession plan; Safety Training Center retrofitting and upgrades; minor
building renovations at city facilities; and other one-time capital outlay items, as needed throughout
the city.
• Capital projects – citywide infrastructure replacement projects, beach access repair/upgrade; widening
of El Camino Real; rehabilitation work at the Faraday Center; Safety Center building improvements;
replacement of Fire Station No. 2 and the Monroe Stree Pool; synthetic turf at Stagecoach Park; the
ongoing pavement management program; analysis and conceptual alignments for two double-track
railroad trench alternatioves through the village area; continuing the implementation of an adaptive
traffic signal program and street lighting replacement program; traffic calming measures and multiuse
trail; additional water and recycled water lines; continuation of drainage and street improvements at
the Encina Water Pollution Control Facility; access road improvements at the Buena Interceptor Sewer;
and wastewater line refurbishments/replacements at various locations throughout the city.
Unassigned Fund Balance – this includes the remaining spendable amounts which are not included in one
of the other classifications. The General Fund is the only fund that reports a positive unassigned fund
balance amount.
It is the city’s policy that restricted resources will be applied first, followed by (in order of application) committed,
assigned, and unassigned resources, in the absence of a formal policy adopted by the City Council.
Note 11. General Fund Balance Policy
It is the policy of the city to maintain a minimum reserve for unforeseen emergencies or catastrophic impacts upon
the city, and whenever fiscally possible and financially prudent, to maintain a greater target reserve. The minimum
reserve of the General Fund is 30 percent of General Fund operating expenditures and the target reserve is a range
of 40 percent to 50 percent of General Fund operating expenditures. The minimum reserve would provide
approximately three to four months of operating expenditures for unforeseen emergencies and the target reserve
of 40 percent to 50 percent would provide approximately five to six months of operating expenditures for
catastrophic events.
Note 12. Accumulated Fund Deficits/Negative Net Position
The following funds reported deficits in fund balances or net position as of June 30, 2018:
Deficit Balance
Enterprise Funds:
Golf Course (17,756,533)$
The deficit in the Golf Course Fund is the result of the General Fund advancing money to the Golf Course Fund for
the construction of the course and partially subsidizing the operations of the course in prior fiscal years.
Notes to the Financial Statements
92
Note 13. Interfund Transfers
Interfund transfers for the year ended June 30, 2018, consisted of the following:
Transfers Out Amount
General Fund Gas Tax Fund 10,000$
Bridge and Thoroughfare Districts 174,400
Capital Project Funds:
Infrastructure Replacement General Fund 9,970,000
Enterprise Funds:
Storm Water Protection General Fund 218,511
Internal Service Funds:
Fleet Management General Fund 358,216
Fleet Management Wastewater Fund 82,000
Workers' Compensation General Fund 1,500,000
Special Revenue Funds:
Affordable Housing Tyler Court Apartments 485,381
Financing Districts General Fund 850,000
Section 8 Rental Assistance Affordable Housing 23,868
13,672,376$
Transfers In
Transfers are used to: (1) move revenues and expenditures to the appropriate funds; (2) use unrestricted revenues
collected in the General Fund to finance various programs accounted for in other funds in accordance with budgetary
authorizations; and (3) move excess cash collected for future capital replacement in accordance with Council
authorization.
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 Self-Insured Benefits Fund and a Workers’ Compensation Fund (all internal service funds) to account for and
finance its uninsured risks of loss. All other funds of the city make payments to these funds based on annual
estimates of the amounts needed to pay prior and current year claims and to establish a reserve for catastrophic
losses.
Beginning July 1, 2015, the city joined California State Association of Counties Excess Insurance Authority (CSAC-EIA)
for excess general liability coverage. This coverage was purchased through the city’s broker, Alliant Insurance
Services. Under this program, the city’s coverage is a maximum of $25,000,000 per occurrence with a self-insured
retention (SIR) of $1,000,000. CSAC-EIA is one of the largest risk sharing pools of its kind in the country. At June 30,
2018, the unrestricted fund equity for the Risk Management Self-Insurance Fund was $1,254,338. Funds used by
the Risk Management Fund to liquidate the claims liability predominantly come from the General Fund (84.80%), the Water funds (5.79%) and the Wastewater funds (2.62%).
Notes to the Financial Statements
93
Note 14. Risk Management (continued)
Dental insurance coverage for city employees is administered by MetLife. Under the city’s agreement with MetLife,
MetLife will pay dental claims for each covered member, up to a maximum of $1,500 per calendar year.
The city is insured for workers’ compensation claims by Safety National. Safety National provides coverage up to a
maximum of $2,000,000 per occurrence for losses which exceed the city’s SIR of $1,250,000 for all employees. At
June 30, 2018, the unrestricted fund equity for the Workers’ Compensation Self-Insurance Fund was $2,167,755.
Funds used by the Workers’ Compensation Fund to liquidate the claims liability predominantly come from the
General Fund (91.23%), the Water funds (3.01%) and the Wastewater funds (1.31%).
The estimated claims payable reported at June 30, 2018 is based on the requirements of GASB, which requires that
a liability for claims be reported if information prior to the issuance of the financial statements indicates that it is
probable that a liability has been incurred at the date of the financial statements and the amount of the loss can be
reasonably estimated. Settled cases did not exceed insurance coverage during the past fiscal year.
Changes in the estimated claims payable amounts in Fiscal Years 2017 and 2018 for the three internal service funds
are as follows:
Expense and
Beginning Changes in Claim Ending
Balance Estimates Payments Balance
Self-Insured Benefits Fund:
2016-17 105,338$ 631,465$ 631,545$ 105,258$
2017-18 105,258 609,912 613,003 102,167
Risk Management Fund:
2016-17 1,110,729 2,998,566 1,174,654 2,934,641
2017-18 2,934,641 1,131,031 1,743,555 2,322,117
Workers’ Compensation Fund:
2016-17 8,319,545 1,395,639 2,359,635 7,355,549
2017-18 7,355,549 3,701,351 2,615,752 8,441,148
Claims
Note 15. Joint Ventures
Encina Water Pollution Control Facilities
The Encina Water Pollution Control Facilities (the facilities) are wastewater facilities owned jointly by the cities of
Carlsbad, Vista and Encinitas and the Leucadia Wastewater 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 facilities. It is responsible for the management, maintenance and operations of the joint system.
Each member agency has a specified percentage of ownership in the various components of the Encina Water
Pollution Control Facilities that varies from component to component. Accordingly, each member agency reports
its undivided interest in the facilities as a part of that member agency’s capital assets.
Notes to the Financial Statements
94
Note 15. Joint Ventures (continued)
As of June 30, 2017, the undivided interest of each member agency in the various components of the Encina Water
Pollution Control Facilities aggregated as follows:
City of Carlsbad 24%
City of Vista 25%
Leucadia Wastewater District 17%
Vallecitos Water District 23%
Buena Sanitation District 7%
City of Encinitas 4%
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 loss (before member billings) for EWA totaled $5,384 in
Fiscal Year 2017. The financial statements of EWA can be obtained at 6200 Avenida Encinas, Carlsbad, California
92011 or at www.encinajpa.com.
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’s Administrative Services Department.
The city’s share in the accounts of the Authority is recorded in the Wastewater Enterprise Fund. The expansion of
the facility is shown as a capital asset of the Wastewater Enterprise Fund.
Note 16. Pension Plan
Plan description
All qualified permanent and probationary employees are eligible to participate in the city’s Safety (sworn police and
fire) and Miscellaneous (all other) Plans (the Plans), agent multiple-employer defined benefit pension plans
administered by CalPERS, which acts as a common investment and administrative agent for its participating member
employers. Benefit provisions under the Plans are established by State of California statute and city resolution.
CalPERS issues publicly available reports that include a full description of the pension plans regarding benefit
provisions, assumptions and membership information that can be found on the CalPERS website.
Notes to the Financial Statements
95
Note 16. Pension Plan (continued)
Benefits Provided
CalPERS provides service retirement and disability benefits, annual cost of living adjustments, and death benefits to
plan members, who must be public employees and beneficiaries. Benefits are based on years of credited service,
equal to one year of full time employment. The Plans’ provisions and benefits in effect at June 30, 2018, are
summarized as follows:
On or after
Prior to November 28, 2011 to On or after
Hire date November 28, 2011 December 31, 2012 January 1, 2013
Benefit formula 3% @ 60 2% @ 60 2% @ 62
Benefit vesting schedule 5 years of service 5 years of service 5 years of service
Benefit payments monthly for life monthly for life monthly for life
Retirement age 50 - 60 50 - 63 52 - 67
Monthly benefits, as a % of eligible compensation 2.0% to 3.0% 1.092% to 2.418% 1.0% to 2.5%
Required employee contribution rates 8%7%6.75%
Required employer contribution rates 12.255%12.255%12.255%
Required employer payment of unfunded liability:
Miscellaneous
$6,649,209
On or after
Prior to October 4, 2010 to On or after
Hire date October 4, 2010 December 31, 2012 January 1, 2013
Benefit formula 3% @ 50 2% @ 50 2.7% @ 57
Benefit vesting schedule 5 years of service 5 years of service 5 years of service
Benefit payments monthly for life monthly for life monthly for life
Retirement age 50 50 - 55 50 - 57
Monthly benefits, as a % of eligible compensation 3%2.0% to 2.7% 2.0% to 2.7%
Required employee contribution rates 9%9%12%
Required employer contribution rates 19.718%19.718%19.718%
Required employer payment of unfunded liability:
Safety
$4,564,145
Notes to the Financial Statements
96
Note 16. Pension Plan (continued)
Employees Covered
As of June 30, 2017, the following employees were covered by the benefit terms for each Plan:
Miscellaneous Safety
Inactive employees or beneficiaries currently receiving benefits 486 219
Inactive employees or beneficiaries currently not yet receiving benefits 433 89
Active employees 489 185
Total 1,408 493
Contribution Description
Section 20814(c) of the California Public Employees’ Retirement Law (PERL) requires that the employer contribution
rates for all public employers be determined on an annual basis by the actuary and shall be effective on the July 1
following notice of a change in the rate. The total plan contributions are determined through the CalPERS annual
actuarial valuation process. The actuarially determined rate is the estimated amount necessary to finance the costs
of benefits earned by employees during the year, with an additional amount to finance any unfunded accrued
liability. The employer is required to contribute the difference between the actuarially determined rate and the
contribution rate of employees. For the measurement period ending June 30, 2017 (the measurement date), the
average active employee contribution rate ranged from 6.75 percent to 8.0 percent of annual pay for miscellaneous
employees and 9.0 percent to 12.0 percent of annual pay for safety employees, and the average employer’s
contribution rate is 12.255 percent of annual payroll for miscellaneous employees and 19.718 percent of annual
payroll for safety employees. Employer contribution rates may change if plan contracts are amended. Payments
made by the employer to satisfy contribution requirements that are identified by the pension plan terms as plan
member contribution requirements are classified as plan member contributions.
Actuarial Methods and Assumptions Used to Determine Total Pension Liability
For the measurement period ending June 30, 2017 (the measurement date), the total pension liability was
determined by rolling forward the June 30, 2016 total pension liability determined in the June 30. 2016 actuarial
accounting valuation. The June 30, 2017 total pension liability was based on the following actuarial methods and
assumptions:
Actuarial cost method Entry Age Normal in accordance with the requirements of GASB 68
Actuarial assumptions
Discount rate 7.15%
Inflation 2.75%
Salary increases Varies by entry age and service
Mortality rate table*Derived using CalPERS' membership data for all funds
Post-retirement benefit increase Contract COLA up to 2.75% until Purchasing Power Protection Allowance Floor on
purchasing power applies; 2.75% thereafter
* The mortality table used was developed based on CalPERS' specific data. The table includes 20 years of
mortality improvements used Society of Actuaries Scalee BB. For more details on this table, please refer
to the 2014 experience study report.
Notes to the Financial Statements
97
Note 16. Pension Plan (continued)
All other actuarial assumptions used in the June 30, 2016 valuation were based on the results of an actuarial
experience study for the period from 1997 to 2011, including updates to salary increase, mortality and retirement
rates. The Experience Study report can be obtained at the CalPERS website at www.calpers.ca.gov under Forms and
Publications.
Change of Assumption
In 2017, the accounting discount rate reduced from 7.65 percent to 7.15 percent.
Discount Rate
The discount rate used to measure the total pension liability was 7.15 percent. To determine whether the municipal
bond rate should be used in the calculation of a discount rate for each plan, CalPERS stress tested plans that would
most likely result in a discount rate that would be different from the actuarially assumed discount rate. The tests
revealed that the assets would not run out. Therefore, the current 7.15 percent discount rate is appropriate and the use of the municipal bond rate calculation is not deemed necessary. The long term expected discount rate of 7.15
percent is applied to all plans in the Public Employees Retirement Fund (PERF). The cash flows used in the testing
were developed assuming that both members and employers will make their required contributions on time and as
scheduled in all future years. The stress test results are presented in a detailed report called “GASB Crossover Testing
Report” that can be obtained at the CalPERS website under the GASB 68 section.
The long-term expected rate of return on pension plan investments was determined using a building-block method
in which expected future real rates of return (expected returns, net of pension plan investment expense and
inflation) are developed for each major asset class.
In determining the long-term expected rate of return, CalPERS staff took into account both short-term and long-
term market return expectations as well as the expected pension fund cash flows. Taking into account historical
returns of all the Public Employees Retirement Funds’ (PERF) asset classes (which includes the agent plan and two
cost-sharing plans or PERF A, B, and C funds), expected compound (geometric) returns were calculated over the
short-term (first 10 years) and the long-term (11 – 60 years) using a building-block approach. Using the expected
nominal returns for both short-term and long-term, the present value of benefits was calculated for each PERF fund.
The expected rate of return was set by calculating the single equivalent expected return that arrived at the same
present value of benefits for cash flows as the one calculated using both short-term and long-term returns. The
expected rate of return was then set equal to the single equivalent rate calculated above and rounded down to the
nearest one quarter of one percent.
The table on the next page reflects long-term expected real rate of return by asset class. The rate of return was
calculated using the capital market assumptions applied to determine the discount rate and asset allocation. These
rates of return are net of administrative expenses. The target allocation shown was adopted by the Board effective
on July 1, 2014.
Notes to the Financial Statements
98
Note 16. Pension Plan (continued)
Discount Rate (continued)
Current Target Real Return Real Return
Asset Class Allocation Years 1 - 10¹Years 11+²
Global equity 47.0%4.90%5.38%
Global debt securities 19.0 0.80 2.27
Inflation assets 6.0 0.60 1.39
Private equity 12.0 6.60 6.63
Real estate 11.0 2.80 5.21
Infrastructure and forestland 3.0 3.90 5.36
Liquidity 2.0 (0.40)(0.90)
¹ An expected inflation of 2.5% used for this period.
² An expected inflation of 3.0% used for this period.
Pension Plan Fiduciary Net Position
CalPERS issues a publicly available financial report that includes financial statements and required supplementary
information. That report may be obtained on the California Public Employees’ Retirement System website at
www.calpers.ca.gov under forms and publications.
Notes to the Financial Statements
99
Note 16. Pension Plan (continued)
Changes in Net Pension Liability
Miscellaneous Safety
Plan Plan Total
Net pension liability 101,804,851$ 79,540,681$ 181,345,532$
Deferred outflows of resources - pension related items 40,235,500 24,880,882 65,116,382
Deferred inflows of resources - pension related items (3,431,634) (2,718,205) (6,149,839)
Pension expense 16,665,878 12,711,835 29,377,713
The following table shows the changes in net pension liability recognized over the measurement period.
Total Pension Plan Fiduciary Net Pension
Liability Net Position Liability/(Asset)
(a)(b)(c) = (a) - (b)
Balance at: 6/30/2016 336,686,595$ 241,681,934$ 95,004,661$
Changes Recognized for the Measurement Period:
• Service cost 7,836,970 - 7,836,970
• Interest on the Total Pension Liability 25,085,808 - 25,085,808
• Differences between expected and actual experience (3,079,012) - (3,079,012)
• Changes of assumptions 20,988,178 - 20,988,178
• Plan to plan resource movement - (2,793) 2,793
• Contributions from the employer - 14,677,334 (14,677,334)
• Contributions from employees - 2,820,046 (2,820,046)
• Net investment income - 26,893,994 (26,893,994)
• Benefit payments, including refunds of employee contributions (15,327,609) (15,327,609) -
• Administrative expense - (356,827) 356,827
Net Changes during 2016-17 35,504,335 28,704,145 6,800,190
Balance at 6/30/2017 372,190,930$ 270,386,079$ 101,804,851$
Increase (Decrease)Miscellaneous Plan
Notes to the Financial Statements
100
Note 16. Pension Plan (continued)
Total Pension Plan Fiduciary Net Pension
Liability Net Position Liability/(Asset)
(a)(b)(c) = (a) - (b)
Balance at: 6/30/2016 257,649,541$ 184,778,552$ 72,870,989$
Changes Recognized for the Measurement Period:
• Service cost 5,825,080 - 5,825,080
• Interest on the Total Pension Liability 19,305,098 - 19,305,098
• Differences between expected and actual experience (705,417) - (705,417)
• Changes of assumptions 16,661,943 - 16,661,943
• Plan to plan resource movement - 2,793 (2,793)
• Contributions from the employer - 12,379,181 (12,379,181)
• Contributions from employees - 1,922,500 (1,922,500)
• Net investment income - 20,385,351 (20,385,351)
• Benefit payments, including refunds of employee contributions (13,034,483) (13,034,483) -
• Administrative expense - (272,813) 272,813
Net Changes during 2016-17 28,052,221 21,382,529 6,669,692
Balance at 6/30/2017 285,701,762$ 206,161,081$ 79,540,681$
Increase (Decrease)
Safety Plan
Sensitivity of the Net Pension Liability to Changes in the Discount Rate
The following presents the net pension liability of the Plan as of the measurement date, calculated using the discount rate of 7.15 percent, as well as what the net pension liability would be if it were calculated using a discount rate that
is 1 percentage-point lower (6.15 percent) or 1 percentage-point higher (8.15 percent) than the current rate:
Discount Rate - 1%Current Discount Discount Rate + 1%
(6.15%)Rate (7.15%)(8.15%)
Plan's Net Pension Liability - Miscellaneous 152,751,862$ 101,804,851$ 59,803,677$
Plan's Net Pension Liability - Safety 120,213,204$ 79,540,681$ 46,389,873$
Recognition of Gains and Losses
Under GASB 68, deferred inflows and deferred outflows of resources related to pensions are recognized in pension
expense systematically over time.
The first amortized amounts are recognized in pension expense for the year the gain or loss occurs. The remaining
amounts are categorized as deferred inflows and deferred outflows of resources related to pensions and are to be
recognized in future pension expense.
Notes to the Financial Statements
101
Note 16. Pension Plan (continued)
The amortization period differs depending on the source of the gain or loss:
Difference between projected and actual
earnings
5 year straight-line amortization
All other amounts Straight-line amortization over the expected average remaining
service lifetime (EARSL) of all members that are provided with
benefits (active, inactive, and retired) as of the beginning of the
measurement period
The expected average remaining service lifetime (EARSL) is calculated by dividing the total future service years by
the total number of plan participants (active, inactive, and retired).
The EARSL for the Miscellaneous Plan for the June 30, 2017 measurement date is 3.1 years, which was obtained by
dividing the total service years of 4,374 (the sum of remaining service lifetimes of the active employees) by 1,408
(the total number of participants: active, inactive, and retired). Note that inactive employees and retirees have
remaining service lifetimes equal to zero. Also note that total future service is based on the members’ probability
of decrementing due to an event other than receiving a cash refund.
The EARSL for the Safety Plan for the June 30, 2017 measurement date is 4.6 years, which was obtained by dividing
the total service years of 2,291 (the sum of remaining service lifetimes of the active employees) by 493 (the total
number of participants: active, inactive, and retired). Note that inactive employees and retirees have remaining
service lifetimes equal to zero. Also note that total future service is based on the members’ probability of
decrementing due to an event other than receiving a cash refund.
Pension Expense and Deferred Outflows and Deferred Inflows of Resources Related to Pensions
For the measurement period ending June 30, 2017 (the measurement date), the city recognized a pension expense
of $29,377,713 for the Plans.
As of June 30, 2017, the city reports other amounts for the Miscellaneous Plan as deferred outflows and deferred
inflows of resources related to pensions as follows:
Deferred Outflows Deferred Inflows
of Resources of Resources
Pension contributions subsequent to measurement date 22,092,810$ -$
Difference between expected and actual experience 41,951 (3,010,218)
Change in allocation between programs 236,327 (236,327)
Changes of assumptions 14,217,798 (185,089)
Net difference between projected and actual earnings on pension plan investments 3,646,614 -
Total 40,235,500$ (3,431,634)$
Notes to the Financial Statements
102
Note 16. Pension Plan (continued)
As of June 30, 2017, the city reports other amounts for the Safety Plan as deferred outflows and deferred inflows of
resources related to pension as follows:
Deferred Outflows Deferred Inflows
of Resources of Resources
Pension contributions subsequent to measurement date 8,658,116$ -$
Difference between expected and actual experience 231,050 (1,084,149)
Changes of assumptions 13,039,781 (1,634,056)
Net difference between projected and actual earnings on pension plan investments 2,951,935 -
Total 24,880,882$ (2,718,205)$ For the Miscellaneous Plan, $22,092,810 reported as deferred outflows of resources related to employer
contributions subsequent to the measurement date, and for the Safety Plan, $8,658,116 reported as deferred
outflows of resources related to employer contributions subsequent to the measurement date, will be recognized
as a reduction of the net pension liability in the year ended June 30, 2019. Other amounts reported as deferred
outflows of resources and deferred inflows of resources related to the Miscellaneous Plan pensions will be
recognized as pension expense as follows:
Deferred
Measurement Period Outflows/(Inflows) of
Ended June 30:Resources
2018 4,797,815$
2019 9,753,202
2020 2,077,628
2021 (1,917,589)
2022 -
Thereafter -
Other amounts reported as deferred outflows of resources and deferred inflows of resources related to the Safety
Plan pensions will be recognized as pension expense as follows:
Deferred
Measurement Period Outflows/(Inflows) of
Ended June 30:Resources
2018 2,438,058$
2019 5,879,336
2020 4,542,168
2021 644,999
2022 -
Thereafter -
Note 17. Other Post Employment Benefits (OPEB)
The city and former employees of CMWD are offered other postemployment benefits (OPEB) in the form of health
benefits. The majority of city employees are under the city defined benefit agent multiple-employer plan. CMWD
has a defined benefit agent multiple-employer plan.
Notes to the Financial Statements
103
Note 17. Other Post Employment Benefits (OPEB) (continued)
Plan Descriptions
Carlsbad Municipal Water District (CMWD)
The first Plan is for active and retired employees who were employed with CMWD at the time CMWD was acquired
by the city. Per Resolution No. 614, all former employees of CMWD (including dependents) are eligible for
postretirement health care benefits if they voluntarily retire after the age of 50, with no less than five years of service
and whose age, combined with years of service, equals 70 or more.
The city pays for 100 percent 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.
This Plan is administered by the Association of California Water Agencies (ACWA).
City of Carlsbad
City employees are offered health insurance coverage under the Public Employees’ Medical and Hospital Care Act
(PEMHCA), which is administered by CalPERS. Under PEMHCA, the city is required to pay a small portion of the
monthly medical premiums of retired employees (considered a subsidy), if the retired employees continue their
medical coverage under PEMHCA. Surviving spouses of eligible retirees are eligible for the city subsidy. Surviving
spouses/domestic partners of deceased active members are eligible for the city subsidy only if the employee had
attained age 50 with five years of service.
The city pays a monthly subsidy per eligible employee/retiree regardless of coverage elected:
Calendar Year 2016 $125.00
Calendar Year 2017 128.00
Calendar Year 2018 133.00
Thereafter, the subsidy is adjusted annually to reflect changes in the medical component of the Consumer Price
Index.
California Public Employer’s Retiree Benefit Trust Program
The city is participating in the California Employer’s Retiree Benefit Trust Program (CERBT) through irrevocable trust
agreements for both Plans. CERBT is administered by CalPERS. The city’s OPEB fiduciary net position is included in
the CERBT Schedule of Changes in Fiduciary Net Position by Employer report. That report may be obtained on the
California Public Employees’ Retirement System website at www.calpers.ca.gov under forms and publications.
Employees Covered
As of the June 30, 2017 measurement date, the following employees were covered by the benefit terms for each
Plan:
CMWD City
Inactive employees or beneficiaries currently receiving benefits 18 192
Inactive employees or beneficiaries currently not yet receiving benefits - -
Active employees 2 664
Total 20 856
Notes to the Financial Statements
104
Note 17. Other Post Employment Benefits (OPEB) (continued)
Contributions
The obligation of CMWD to contribute to the CMWD Plan is established, and may not be amended by the CMWD
Board. The obligation of the city to contribute to the city Plan is established, and as long as the city is a member of
PEMCHA, may not be amended by the City Council. The City Council does have the authority to change health
insurance coverage outside of PEMHCA, which could change the funding obligation for city employees.
Employees are not required to contribute to the Plans. The city and CMWD’s contributions are based on the
actuarially determined contribution (ADC), an amount actuarially determined in accordance with the parameters of
GASB. The ADC represents a level of funding that, if paid on an ongoing basis, is projected to cover the normal cost
each year and to amortize any unfunded actuarial liabilities (or funding excess) over a period not to exceed thirty
years on a “closed” basis. The city’s and CMWD’s contributions for each Plan are as follows:
CMWD City
June 30, 2018 Cash Contributions 314,404 $ 262,139 $
June 30, 2018 Estimated Implied Subisdy 255,451 28,900
Total Contributions 569,855 $ 291,039 $
Net OPEB Liability
The city’s and CMWD’s net OPEB liability was measured as of June 30, 2017 and the total OPEB liability used to
calculate the net OPEB liability was determined by an actuarial valuation dated June 30, 2016 that was rolled forward
to determine the June 30, 2017 total OPEB liability, based on the actuarial methods and assumptions shown on the
following page:
Actuarial Cost Method: Entry Age Normal
Actuarial Assumptions:
Discount Rate 7.00%
Inflation 2.75%
Salary Increases 3.00%
Investment Rate of Return 7.00% with a 45% to 50% confidence based on Bartel
Associates modeling for CERBT Strategy 1.
Mortality Rate1 Derived using CalPERS’ Membership Data for all funds.
Pre-Retirement Turnover2 Derived using CalPERS’ Membership Data for all funds.
Healthcare Trend Rate3 Based in part on premium experience.
Notes:
1. Based on CalPERS 1997-2015 Experience Study. The Experience Study Reports may be accessed on the CalPERS website
www.calpers.ca.gov under Forms and Publications. 2. Based on CalPERS 1997-2015 Experience Study for Miscellaneous Employees. The Experience Study Reports may be accessed on the CalPERS website www.calpers.ca.gov under Forms and Publications.
3. Short-term healthcare trend’s were developed in consultation with Axene Health Partner’s healcare actuaries. Long-term healthcare
trend developed using Society of Actuaries’ Getzen Model of Long-Run Medical Cost Trends.
Notes to the Financial Statements
105
Note 17. Other Post Employment Benefits (OPEB) (continued)
The target allocation and best estimates of arithmetic real rates of return for each major asset class are summarized
in the following table:
CERBT Strategy 1
Asset Class
Target
Allocation
Long-Term Expexted
Real Rate of Return
Global Equity 57% 4.82%
Fixed Income 27% 1.47%
TIPS 5% 1.29% Commodities 3% 0.84%
REITS 8% 3.76%
Total 100%
Notes:
1. The long-term expected rate of return is 7.00%.
Discount Rate
The discount rate used to measure the total OPEB liability was 7.00 percent. The projection of cash flows used to
determine the discount rate assumed that city and CMWD contributions will be made at rates equal to the actuarially
determined contribution rates. Based on those assumptions, the OPEB Plans’ fiduciary net position was projected
to be available to make all projected OPEB payments for current active and inactive employees and beneficiaries.
Therefore, the long-term expected rate of return on OPEB Plans investments was applied to all periods of projected
benefit payments to determine the total OPEB liability.
Changes in OPEB Liability
CMWD City
Plan Plan Total
Net OPEB liability 793,675$ 1,697,946$ 2,491,621$
Deferred outflows of resources - OPEB related items 291,039 569,854 860,893
Deferred inflows of resources - OPEB related items (91,364) (260,570) (351,934)
OPEB expense 54,730 585,202 639,932
Notes to the Financial Statements
106
Note 17. Other Post Employment Benefits (OPEB) (continued)
The changes in the net OPEB liability for the CMWD plan are shown below:
Total OPEB Plan Fiduciary Net OPEB
Liability Net Position Liability/(Asset)
(a)(b)(c) = (a) - (b)
Balance at: 6/30/2017 (Measurement Date: 6/30/2016) 4,041,120$ 3,077,703$ 963,417$
Changes Recognized for the Measurement Period:
• Service cost 12,228 - 12,228
• Interest on the total OPEB liability 274,428 - 274,428
• Contributions from the employer - 133,108 (133,108)
• Net investment income - 324,939 (324,939)
• Benefit payments, including refunds of employee contributions (265,872) (265,872) -
• Administrative expense - (1,649) 1,649
Net Changes 20,784 190,526 (169,742)
Balance at 6/30/2018 (Measurement Date: 6/30/2017)4,061,904$ 3,268,229$ 793,675$
CMWD Plan Increase (Decrease)
The changes in the net OPEB liability for the city Plan are shown below:
Total OPEB Plan Fiduciary Net OPEB
Liability Net Position Liability/(Asset)
(a)(b)(c) = (a) - (b)
Balance at: 6/30/2017 (Measurement Date: 6/30/2016) 11,102,453$ 9,114,475$ 1,987,978$
Changes Recognized for the Measurement Period:
• Service cost 493,120 - 493,120
• Interest on the total OPEB liability 789,709 - 789,709
• Contributions from the employer - 614,664 (614,664)
• Net investment income - 963,086 (963,086)
• Benefit payments, including refunds of employee contributions (628,027) (628,027) -
• Administrative expense - (4,889) 4,889
Net Changes 654,802 944,834 (290,032)
Balance at 6/30/2018 (Measurement Date: 6/30/2017)11,757,255$ 10,059,309$ 1,697,946$
City Plan Increase (Decrease)
Notes to the Financial Statements
107
Note 17. Other Post Employment Benefits (OPEB) (continued)
Sensitivity of the Net OPEB Liability to Changes in the Discount Rate
The following presents the net OPEB liability of the CMWD and city if it were calculated using a discount rate that is
one percentage point lower or one percentage point higher than the current rate, for measurement period ended
June 30, 2017:
Discount Rate - 1%Current Discount Discount Rate + 1%
(6.00%)Rate (7.00%)(8.00%)
Plan's Net OPEB Liability - CMWD 1,277,456$ 793,675$ 396,018$
Plan's Net OPEB Liability - City 3,224,471$ 1,697,946$ 437,531$
Sensitivity of the Net OPEB Liability to Changes in the Health Care Cost Trend Rates
The following presents the net OPEB liability of the CMWD and city if it were calculated using health care cost trend
rates that are one percentage point lower or one percentage point higher than the current rate, for measurement
period ended June 30, 2017:
Health Care Cost
Trend Rate - 1%
Current Health
Care Cost Trend
Rate
Health Care Cost
Trend Rate + 1%
(6.50%/5.50%
decreasing to 3.00%)
(7.50%/6.50%
decreasing to
4.00%)
(8.50%/7.50%
decreasing to
5.00%)
Plan's Net OPEB Liability - CMWD 394,074$ 793,675$ 1,274,885$
Plan's Net OPEB Liability - City 292,320$ 1,697,946$ 3,429,419$
OPEB Plan Fiduciary Net Position
The CERBT issues a publicly available financial report that includes financial statements and required supplementary
information. That report may be obtained from the California Public Employees’ Retirement System, CERBT, P.O.
Box 942703, Sacramento, CA 94429-2703.
Recognition of Deferred Outflows and Deferred Inflows of Resources
Gains and losses related to changes in total OPEB liability and fiduciary net position are recognized in OPEB expense
systematically over time.
Amounts are first recognized in OPEB expense for the year the gain or loss occurs. The remaining amounts are
categorized as deferred outflows and deferred inflows of resources related to OPEB and are to be recognized in
future OPEB expense. The initial recognition period is five years.
Notes to the Financial Statements
108
Note 17. Other Post Employment Benefits (OPEB) (continued)
OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB (CMWD)
For the fiscal year ended June 30, 2018, the CMWD recognized OPEB expense of $54,730. As of the fiscal year ended
June 30, 2018, the CMWD reported deferred outflows of resources related to OPEB from the following sources:
Deferred Outflows Deferred Inflows
of Resources of Resources
OPEB contributions subsequent to measurement date 291,039$ -$
Net difference between projected and actual earnings on
OPEB plan investments - (91,364)
Total 291,039$ (91,364)$
The $291,039 reported as deferred outflows of resources related to contributions subsequent to the June 30, 2017
measurement date will be recognized as a reduction of the net OPEB liability during the fiscal year ending June 30,
2019. Other amounts reported as deferred inflows of resources related to OPEB will be recognized as expense as
follows:
Deferred
Fiscal Year Outflows/(Inflows)
Ended:of Resources
2019 (22,841)$
2020 (22,841)
2021 (22,841)
2022 (22,841)
2023 -
Thereafter -
OPEB Expense and Deferred Outflows/Inflows of Resources Related to OPEB (City)
For the fiscal year ended June 30, 2018, the city recognized OPEB expense of $585,202. As of the fiscal year ended
June 30, 2018, the city reported deferred outflows of resources related to OPEB from the following sources:
Deferred Outflows Deferred Inflows
of Resources of Resources
OPEB contributions subsequent to measurement date 569,855$ -$
Net difference between projected and actual earnings on
OPEB plan investments - (260,570)
Total 569,855$ (260,570)$
Notes to the Financial Statements
109
Note 17. Other Post Employment Benefits (OPEB) (continued)
The $569,855 reported as deferred outflows of resources related to contributions subsequent to the June 30, 2017
measurement date will be recognized as a reduction of the net OPEB liability during the fiscal year ending June 30,
2019.
Other amounts reported as deferred inflows of resources related to OPEB will be recognized as expense as follows:
Deferred
Fiscal Year Outflows/(Inflows)
Ended:of Resources
2019 (65,142)$
2020 (65,142)
2021 (65,142)
2022 (65,144)
2023 -
Thereafter -
Note 18. Commitments and Contingencies
Operating leases
The city has two parking lot leases with North County Transit District. On June 15, 1976, the city entered into a
month-to-month lease for the parking lot located to the east of the railroad tracks between Carlsbad Village Drive
and Oak Avenue. The current lease amount is approximately $1,412 per month and payable monthly. On September
1, 1988, the city entered into a month-to-month lease for the parking lot located on Washington Street to the west
of the railroad tracks between Carlsbad Village Drive and Oak Avenue. The current lease amount is approximately
$2,318 per month and payable annually. Both parking lot leases may be increased annually by the Consumer Price
Index – Average U.S. Cities.
Water purchase agreements
On March 25, 1991, CMWD entered into a twenty year agreement with the Leucadia Wastewater District (LWD), to
purchase recycled water to be used primarily for irrigation at the La Costa Resort & Spa golf course, and for other
appropriate uses within the CMWD boundaries. CMWD agreed to purchase a minimum of 394 acre feet of recycled
water per fiscal year, at a basic price of retail potable water charged to residential users within the CMWD boundary.
The cost per that agreement was $1,222.84 per acre foot or a minimum of $481,800 per fiscal year, regardless of
the actual amount used. On September 1, 2013, CMWD and LWD revised the original agreement and extended the
term of the agreement for a minimum of five years. The agreement will continue year-to-year past the five year
term unless either party provides notice of termination. CMWD provided notice to LWD the agreement would
terminate effective August 30, 2018. The cost per the revised agreement is shown in the table below and is based
on the actual amount used:
Price per
Acre Feet (AF)AF
Up to 200 AF 950 $
201 to 250 AF 900
251 to 300 AF 850
351 AF or Greater 800
Notes to the Financial Statements
110
Note 18. Commitments and Contingencies (continued)
Additionally, CMWD and the LWD will share equally all rebates or other incentive payments from the Metropolitan
Water District, San Diego County Water Authority, or other governmental agency during the term of the revised
agreement for recycled water produced by LWD for CMWD.
On August 5, 2003, CMWD entered into a twenty-two year agreement with the Vallecitos Water District, to purchase
three million gallons per day (3,360 acre feet) of recycled water for uses throughout CMWD’s boundaries. The
agreement stipulates that CMWD will pay for its share of the actual operating costs (up to a maximum cost of 75
percent of the wholesale cost of potable water from the San Diego County Water Authority) of the Mahr Reservoir,
which produces the water. The estimated operating costs paid by CMWD for the period ended June 30, 2018 is
$1,650,306.
As of June 30, 2018, city commitments for outstanding encumbrances (purchase orders and contracts for goods and
services not yet delivered) by major governmental fund and nonmajor funds in the aggregate are as follows:
Outstanding
Encumbrances
General Fund 9,091,987 $
Community Facilities District No. 1 413,446
General Capital Construction 3,911,001
Infrastructure Replacement 1,048,751
Park Development 668,642
Public Facilities Construction 1,445,672
Nonmajor Governmental Funds in the Aggregate 6,947,900
Total 23,527,399 $
Note 19. Successor Agency Trust for Assets of Former Redevelopment Agency
On December 29, 2011, the California Supreme Court upheld Assembly Bill 1X 26 (“the bill”) which provides for the
dissolution of all redevelopment agencies in the State of California. This action impacted the reporting entity of the
city that previously had reported a redevelopment agency within the reporting entity of the city as a blended
component unit.
The bill provides that upon dissolution of a redevelopment agency, either the city or another unit of local
government will agree to serve as the “successor agency” to hold the assets until they are distributed to other units
of state and local government. On January 10, 2012, the City Council elected to become the Successor Agency for
the former redevelopment agency in accordance with the bill as part of City Council Resolution No. 2012-013 and
Housing and Redevelopment Commission Resolution No. 519.
After enactment of the law, which occurred on June 28, 2011, redevelopment agencies in the State of California
cannot enter into new projects, obligations or commitments. Subject to the control of a newly established oversight
board, remaining assets can only be used to pay enforceable obligations in existence at the date of the dissolution
(including the completion of any unfinished projects that were subject to legally enforceable contractual
commitments). In future years, successor agencies will only be allowed revenue in the amount that is necessary to
pay the estimated annual installment payments on enforceable obligations of the former redevelopment agency
until all enforceable obligations of the prior redevelopment agency have been paid in full and all assets have been
liquidated.
Notes to the Financial Statements
111
Note 19. Successor Agency Trust for Assets of Former Redevelopment Agency (continued)
On March 7, 2014, the city received notice from the California Department of Finance that the loans previously made
by the city to the former redevelopment agency are enforceable obligations and that they were made for legitimate
redevelopment purposes. This approval allows the city to list repayment of these loans on future Redevelopment
Obligation Payment Schedules (ROPS).
In accordance with the timeline set forth in the bill (as modified by the California Supreme Court on December 29,
2011) all redevelopment agencies in the State of California were dissolved and ceased to operate as a legal entities
as of February 1, 2012.
Long-term Debt
The following is a summary of changes in the principal balance of long-term debt for the year ended June 30, 2018:
Principal Principal
Balance at Balance at Due Within
July 1, 2017 Increases Decreases June 30, 2018 One Year
Bonds 6,030,000$ -$ 735,000$ 5,295,000$ 775,000$
Due to the City of Carlsbad 10,860,807 180,708 1,937,593 9,103,922 -
16,890,807$ 180,708$ 2,672,593$ 14,398,922$ 775,000$
The 1993 Carlsbad Housing and Redevelopment Commission Tax Allocation Bonds were issued totaling $15,495,000.
Principal is due in amounts ranging from $775,000 to $1,000,000 on September 1 of each year through 2024. Interest
is 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 a cash reserve in the amount of $1,055,953. Bonds are payable from redevelopment property tax
increment revenues. Minimum annual debt service requirements have not been established for the obligation of
the Successor Agency to the city.
The aggregate maturities of long-term debt are as follows:
Year ended June 30: Principal Interest
2019 775,000 $ 259,496 $
2020 815,000 217,759
2021 855,000 173,707
2022 900,000 127,200
2023 950,000 78,175
2024 1,000,000 26,500
5,295,000 $ 882,837 $
Notes to the Financial Statements
112
Note 19. Successor Agency Trust for Assets of Former Redevelopment Agency (continued)
Pledged Revenue
The Successor Agency has a debt issuance outstanding that is collateralized by the pledging of certain revenues. The
amount and term of the remainder of this commitment is indicated in the debt service to maturity table presented
above. The purpose for which the proceeds of the related debt issuance was utilized is disclosed in the debt
description above. For the current year, debt service payments as a percentage of pledged gross revenue (net of
certain expenses where so required by the debt agreement) are indicated in the table on the following page. This
percentage also approximates the relationship of debt service to pledged revenues for the remainder of the term of
the commitment:
Debt Service as a
Description of Annual Amount of Annual Debt Service Percentage of Pledged
Pledged Revenue Pledged Revenue Payments Revenue
Tax increment (Village Area)3,604,302$ 1,034,134$ 29%
Note 20. Prior Period Adjustments
The City of Carlsbad and Carlsbad Municipal Water District (CMWD) recorded the net other post employment
benefits (OPEB) liability for postretirement healthcare as of June 30, 2017 for both agencies in accordance with the
implementation of GASB 75. The effect of the implementation of GASB 75 on the beginning net position balances is
as follows:
Governmental
Carlsbad Activities -
Munipal Solid Internal
Water District Wastewater Waste Service Funds
Net position at July 1, 2017 $ 297,466,421 $175,078,841 $ 12,089,891 $ 35,152,444
Recognize beginning net OPEB
liability balance (916,692) (38,453) (26,368) (65,370)
Net position at July 1, 2017, as restated $ 296,549,729 $175,040,388 $ 12,063,523 $ 35,087,074
Statement of Revenues, Expenses and
Changes in Net Position
Proprietary Funds
Governmental Business-Type
Activities Activities
Net position at July 1, 2017 $ 1,272,817,354 $470,086,822
Recognize beginning net OPEB
liability balance (1,739,843) (981,513)
Net position at July 1, 2017, as restated $ 1,271,077,511 $469,105,309
Statement of Net Position
Required Supplementary
Information
113
Required Supplementary Information
Schedule of Changes in Net Pension Liability and Related Ratios During Measurement Period
Total Pension Liability
Measurement Total Pension Service Changes of
Period Liability - Beginning Cost Interest Benefit Terms
Miscellaneous Plan
2013–14¹292,931,044 $ 6,908,307 $ 21,793,340 $ -$ 2014–15¹ 310,018,027 6,674,982 23,142,961 -
2015–16¹ 322,606,958 6,836,445 24,192,948 -
2016–17¹ 336,686,595 7,836,970 25,085,808 -
Safety Plan2013–14¹227,568,288 $ 5,425,425 $ 16,876,220 $ -$
2014–15¹ 239,340,454 5,048,529 17,775,039 -
2015–16¹ 247,020,357 5,209,900 18,557,781 -
2016–17¹ 257,649,541 5,825,080 19,305,098 -
Plan Fiduciary Net Position
Plan Fiduciary Net
Measurement Net Position Contributions Contributions InvestmentPeriodBeginningEmployerEmployeeIncome²
Miscellaneous Plan
2013–14¹204,354,694 $ 8,004,157 $ 3,039,951 $ 35,526,156 $
2014–15¹ 239,310,294 8,434,882 2,703,715 5,362,753
2015–16¹ 242,447,633 9,562,926 2,833,466 1,330,196
2016–17¹ 241,681,934 14,677,334 2,820,046 26,893,994
Safety Plan
2013–14¹161,108,415 $ 6,141,746 $ 1,853,365 $ 27,905,516 $ 2014–15¹ 186,479,563 6,491,856 1,726,785 4,107,305
2015–16¹ 187,329,833 6,836,098 1,933,363 990,545
2016–17¹ 184,778,552 12,379,181 1,922,500 20,385,351
114
Required Supplementary Information
Difference Benefit Payments,
Between Expected Including Refunds Net Change in
and Actual Changes of of Employee Total Pension Total Pension
Experience Assumptions Contributions Liability Liability - Ending (a)
-$ -$ (11,614,664) $ 17,086,983 $ 310,018,027 $ 1,300,520 (5,737,798) (12,791,734) 12,588,931 322,606,958 (2,605,228) - (14,344,528) 14,079,637 336,686,595
(3,079,012) 20,988,178 (15,327,609) 35,504,335 372,190,930
-$ -$ (10,529,479) $ 11,772,166 $ 239,340,454 $
638,786 (4,517,683) (11,264,768) 7,679,903 247,020,357
(941,378) - (12,197,119) 10,629,184 257,649,541
(705,417) 16,661,943 (13,034,483) 28,052,221 285,701,762
Benefit Payments,Plan Net Pension Including Refunds Other Changes Net Change Plan Fiduciary Liability/(Asset)
of Employee In Fiduciary in Fiduciary Net Position EndingContributionsNet Position Net Position Ending (b)(a) - (b)
(11,614,664) $ -$ 34,955,600 $ 239,310,294 $ 70,707,733 $ (12,791,734) (572,277) 3,137,339 242,447,633 80,159,325
(14,344,528) (147,759) (765,699) 241,681,934 95,004,661 (15,327,609) (359,620) 28,704,145 270,386,079 101,804,851
(10,529,479) $ -$ 25,371,148 $ 186,479,563 $ 52,860,891 $ (11,264,768) (210,908) 850,270 187,329,833 59,690,524 (12,197,119) (114,168) (2,551,281) 184,778,552 72,870,989
(13,034,483) (270,020) 21,382,529 206,161,081 79,540,681
115
Required Supplementary Information
Schedule of Changes in Net Pension Liability and Related Ratios During Measurement Period (Continued)
Plan Fiduciary Plan Net Pension
Net Position Liability/(Asset)as a Percentage Covered - as a Percentage
Measurement of the Total Employee of Covered -
Period Liability Payroll Employee Payroll
Miscellaneous Plan
2013–14¹77.19%32,856,020 $ 215.20%2014–15¹75.15% 33,730,770 237.64%
2015–16¹71.78% 35,303,101 269.11%2016–17¹72.65% 37,336,682 272.67%
Safety Plan 2013–14¹77.91%18,629,989 $ 283.74%
2014–15¹75.84% 18,020,162 331.24%
2015–16¹71.72% 18,658,097 390.56%
2016–17¹72.16% 19,072,985 417.03%
¹ Historical information is required only for measurement periods for which GASB 68 is applicable.
² Net of administrative expenses.
Notes to Schedule:
Benefit Changes: The figures above do not include any liability impact that may have resulted from plan
changes which have occurred after June 30, 2016 valuation date. This applies for voluntary benefit
changes as well as any offers of two years additional service credit (a.k.a. Golden Handshakes).
Changes of Assumptions: In 2017, the accounting discount rate reduced from 7.65 percent to 7.15 percent. In 2016,
there were no changes. In 2015, amounts reported reflect an adjustment of the discount
rate from 7.5 percent (net of administrative expense) to 7.65 percent (without a reduction
for pension plan administration expense). In 2014, amounts reported were based on the
7.5 percent discount rate.
116
Required Supplementary Information
Schedule of Plan Contributions¹
Contributions
in Relation to Contributions
Actuarially the Actuarially Contribution as a Percentage
Fiscal Year Determined Determined Deficiency Covered of Covered
Ending Contribution Contribution (Excess)Payroll Payroll
Miscellaneous Plan
06/30/14 8,004,157 $ (8,004,157) $ -$ 32,856,020 $ 24.36%
06/30/15 8,434,882 (8,434,882) - 33,730,770 25.01%
06/30/16 9,562,926 (9,562,926) - 35,303,101 27.09%
06/30/17 10,338,549 (14,677,334) (4,338,785) 37,336,682 39.31%06/30/18 11,083,979 (22,092,810) (11,008,831) 34,811,287 63.46%
Safety Plan
06/30/14 6,141,746 $ (6,141,746) $ -$ 18,629,989 $ 32.97%06/30/15 6,491,856 (6,491,856) - 18,020,162 36.03%
06/30/16 6,836,098 (6,836,098) - 18,658,097 36.64%
06/30/17 7,695,135 (12,379,181) (4,684,046) 19,072,985 64.90%
06/30/18 8,658,116 (8,658,116) - 20,768,094 41.69%
¹ Historical information is required only for measurement periods for which GASB 68 is applicable.
Notes to Schedule:
The actuarial methods and assumptions used to set the actuarially determined contributions for Fiscal Year
2017-18 were derived from the June 30, 2017 funding valuation reports.
Actuarial Cost Method Entry Age Normal
Amortization Method/Period For details, see June 30, 2015 Funding Valuation Report
Inflation 2.75 percent
Salary Increases Varies by Entry Age and Service.
Payroll Growth 3.00 percent
Investment Rate of Return 7.5 percent net of pension plan investment and
administrative expenses, including inflation
Retirement Age The probabilities of retirement are based on the 2014
CalPERS Experience Study for the period from 1997 to 2011.
Mortality The probabilities of mortality are based on the 2014
CalPERS Experience Study for the period from 1997 to 2011.
Pre-retirement and post-retirement mortality rates include
20 years of projected mortality improvement using Scale BB
published by the Society of Actuaries.
117
Required Supplementary Information
Schedule of Changes in Net OPEB Liability and Related Ratios During Measurement Period
Total OPEB Liability
Measurement Total OPEB Service Changes of
Period Liability - Beginning Cost Interest Benefit Terms
CMWD Plan
2016–17¹4,041,120 $ 12,228 $ 274,428 $ -$
City Plan
2016–17¹11,102,453 $ 493,120 $ 789,709 $ -$
Plan Fiduciary Net Position
Plan Fiduciary NetMeasurementNet Position Contributions Contributions Investment
Period Beginning Employer Employee Income²
CMWD Plan
2016–17¹3,077,703 $ 133,108 $ -$ 323,290 $
City Plan
2016–17¹9,114,475 $ 614,664 $ -$ 958,197 $
118
Required Supplementary Information
Difference Benefit Payments,
Between Expected Including Refunds Net Change in
and Actual Changes of of Employee Total OPEB Total OPEB
Experience Assumptions Contributions Liability Liability - Ending (a)
-$ -$ (265,872) $ 20,784 $ 4,061,904 $
-$ -$ (628,027) $ 654,802 $ 11,757,255 $
Benefit Payments,Plan Net OPEB
Including Refunds Other Changes Net Change Plan Fiduciary Liability/(Asset)of Employee In Fiduciary in Fiduciary Net Position Ending
Contributions Net Position Net Position Ending (b)(a) - (b)
(265,872) $ -$ 190,526 $ 3,268,229 $ 793,675 $
(628,027) $ -$ 944,834 $ 10,059,309 $ 1,697,946 $
119
Required Supplementary Information
Schedule of Changes in Net OPEB Liability and Related Ratios During Measurement Period (Continued)
Plan Fiduciary Plan Net OPEB
Net Position Liability/(Asset)as a Percentage Covered - as a Percentage
Measurement of the Total Employee of Covered -
Period Liability Payroll Employee Payroll
CMWD Plan 2016–17¹80.46%165,769 $ 478.78%
City Plan 2016–17¹85.56%54,645,089 $ 3.11%
¹ Historical information is required only for measurement periods for which GASB 75 is applicable.
² Net of administrative expenses.
120
Required Supplementary Information
Schedule of Plan Contributions¹
Contributions
in Relation to Contributions
Actuarially the Actuarially Contribution Covered -as a Percentage
Fiscal Year Determined Determined Deficiency Employee of Covered-
Ending2 Contribution Contribution (Excess)Payroll3 Employee Payroll
CMWD Plan
06/30/18 77,750 $ (291,039) $ (213,289) $ 106,131 $ 274.23%
City Plan
06/30/18 692,943 $ (569,855) $ 123,088 $ 55,473,250 $ 1.03%
¹ Historical information is required only for measurement periods for which GASB 75 is applicable.
2 Represents the fiscal year ending for the measurement period.
3 Represents payroll for the following fiscal year end.
Notes to Schedule:
The actuarial methods and assumptions used to set the actuarially determined contributions for Fiscal Year
2017-18 were derived from the June 30, 2018 funding valuation reports.
Actuarial Cost Method Entry Age Normal
Amortization Method/Period For details, see June 30, 2018 Funding Valuation Report
Inflation 2.75 percent
Salary Increases Varies by Entry Age and Service.
Payroll Growth 3.00 percent
Investment Rate of Return 7.0 percent net of pension plan investment and
administrative expenses, including inflation
Retirement Age The probabilities of retirement are based on the
CalPERS Experience Study for the period from 1997 to 2015.
Mortality The probabilities of mortality are based on the
CalPERS Experience Study for the period from 1997 to 2015.
121
This
p
a
g
e is intentionally left blank.
122
Combining and Individual Fund
Statements and Schedules
123
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2018
Community
Affordable Development
Housing Block Grant Donations
Cash and investments 19,354,384 $ 304,845 $ 1,557,193 $
Receivables:
Interest 84,990 1,338 6,842
Other - - -
Due from other governments - - -
Prepaid items - - -
Loan receivables, net of allowances 21,901,611 - -
Total assets 41,340,985 $ 306,183 $ 1,564,035 $
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCES
Liabilities:
Accrued liabilities 7,341 $ -$ 25,522 $
Due to other governments - - -
Deposits payable - - -
Advances from other funds - - -
Unearned revenue - - -
Total liabilities 7,341 - 25,522
Deferred inflows of resources:
Unavailable revenue - grants - - -
Fund balances:
Nonspendable:
Prepaid items - - -
Restricted:
Affordable housing 41,333,644 - -
Lighting and landscaping districts - - -
Habitat and agricultural mitigation/preservation - - -
Capital projects - - -
General government - - -
Public safety - - -
Community services - 306,183 1,538,513
Total fund balances 41,333,644 306,183 1,538,513
Total liabilities, deferred inflows of
resources and fund balances 41,340,985 $ 306,183 $ 1,564,035 $
ASSETS
Special Revenue Funds
124
Other Police
Habitat and Special Grants and Section 8 Tyler
Financing Agricultural Revenue Asset Rental Court
Districts Management Funds Forfeiture Assistance Apartments Totals
7,497,516 $ 1,816,684 $ 639,254 $ 410,402 $ 37,755 $ 193,079 $ 31,811,112 $
30,396 8,406 2,809 1,997 44 - 136,822
12,990 - 80,212 - - 254 93,456
- - - 93,246 - - 93,246
- - - - - 1,454 1,454
- - - - - - 21,901,611
7,540,902 $ 1,825,090 $ 722,275 $ 505,645 $ 37,799 $ 194,787 $ 54,037,701 $
234,192 $ -$ 3,884 $ 119,805 $ 15,985 $ 11,179 $ 417,908 $
- - - - 250 - 250
- - - - 12,960 25,255 38,215
- 185,282 - - - - 185,282
- - - - - - -
234,192 185,282 3,884 119,805 29,195 36,434 641,655
- - 55,948 93,246 - - 149,194
- - - - - 1,454 1,454
- - - - 8,604 156,899 41,499,147
7,306,710 - - - - - 7,306,710
- 1,639,808 - - - - 1,639,808
- - - - - - -
- - 662,443 - - - 662,443
- - - 292,594 - - 292,594
- - - - - - 1,844,696
7,306,710 1,639,808 662,443 292,594 8,604 158,353 53,246,852
7,540,902 $ 1,825,090 $ 722,275 $ 505,645 $ 37,799 $ 194,787 $ 54,037,701 $
(Continued)
Special Revenue Funds Special Revenue Funds
125
Combining Balance Sheet
Nonmajor Governmental Funds (Continued)
June 30, 2018
Grants
Assessment Bridge and and Other
and Other Thoroughfare Gas Capital
Districts Districts Tax Project Funds
Cash and investments 3,259,464 $ 11,881,463 $ 13,937,256 $ 793,527 $
Receivables:
Interest 10,161 52,211 60,960 7,403
Other - - - -
Due from other governments - - 241,039 956,847
Prepaid items - - - -
Loan receivables, net of allowances - - - -
Total assets 3,269,625 $ 11,933,674 $ 14,239,255 $ 1,757,777 $
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCES
Liabilities:
Accrued liabilities 238 $ -$ 851,622 $ 65,530 $
Due to other governments - - - -
Deposits payable 426,179 - - -
Advances from other funds - - - -
Unearned revenue - - 218,373 -
Total liabilities 426,417 - 1,069,995 65,530
Deferred inflows of resources:
Unavailable revenue - grants - - - 956,847
Fund balances:
Nonspendable:
Prepaid items - - - -
Restricted:
Affordable, low and moderate income housing - - - -
Lighting and landscaping districts - - - -
Habitat and agricultural mitigation/preservation - - - -
Capital projects 2,843,208 11,933,674 13,169,260 735,400
General government - - - -
Public safety - - - -
Community services - - - -
Total fund balances 2,843,208 11,933,674 13,169,260 735,400
Total liabilities, deferred inflows of
resources and fund balances 3,269,625 $ 11,933,674 $ 14,239,255 $ 1,757,777 $
ASSETS
Capital Project Funds
126
Planned
Local Traffic Total Other
Drainage Sales Tax/Impact Governmental
Facilities TransNet Projects Totals Funds
6,651,773 $ 6,433,891 $ 20,415,737 $ 63,373,111 $ 95,184,223 $
29,230 28,982 90,144 279,091 415,913
- 97,943 - 97,943 191,399
- 32,403 - 1,230,289 1,323,535
- - - - 1,454
- - - - 21,901,611
6,681,003 $ 6,593,219 $ 20,505,881 $ 64,980,434 $ 119,018,135 $
156,509 $ 1,511,919 $ 47,410 $ 2,633,228 $ 3,051,136 $
- - - - 250
- - - 426,179 464,394
- - 1,973,013 1,973,013 2,158,295
- - - 218,373 218,373
156,509 1,511,919 2,020,423 5,250,793 5,892,448
- 32,403 - 989,250 1,138,444
- - - - 1,454
- - - - 41,499,147
- - - - 7,306,710
- - - - 1,639,808
6,524,494 5,048,897 18,485,458 58,740,391 58,740,391
- - - - 662,443
- - - - 292,594
- - - - 1,844,696
6,524,494 5,048,897 18,485,458 58,740,391 111,987,243
6,681,003 $ 6,593,219 $ 20,505,881 $ 64,980,434 $ 119,018,135 $
127
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended June 30, 2018
Community
Affordable Development Financing
Housing Block Grant Donations Districts
Revenues:
Taxes -$ -$ -$ -$
Intergovernmental - 48,393 - -
Charges for services 17,567 - - 2,438,510
Fines and forfeitures - - - -
Income from property and investments 277,528 176,743 5,624 17,032
Contributions from property owners 762,199 - - -
Donations - - 331,882 -
Miscellaneous 484,398 - 16,091 44,016
Total revenues 1,541,692 225,136 353,597 2,499,558
Expenditures:
Current:
General government - - - -
Public safety - - - -
Community services 369,571 132,520 312,117 1,834,509
Public works - - - 735,213
Capital outlay - 16,335 17,186 -
Debt service:
Interest and fiscal charges - - - -
Total expenditures 369,571 148,855 329,303 2,569,722
Excess (deficiency) of revenues
over (under) expenditures 1,172,121 76,281 24,294 (70,164)
Other financing sources (uses):
Transfers in 485,381 - - 850,000
Transfers out (23,868) - - -
Total other financing sources (uses)461,513 - - 850,000
Net change in fund balances 1,633,634 76,281 24,294 779,836
Fund balances at beginning of year 39,700,010 229,902 1,514,219 6,526,874
Fund balances at end of year 41,333,644 $ 306,183 $ 1,538,513 $ 7,306,710 $
Special Revenue Funds
128
Other Police
Habitat and Special Grants and Section 8 Tyler
Agricultural Revenue Asset Rental Court
Management Funds Forfeiture Assistance Apartments Totals
-$ -$ -$ -$ -$ -$
- - 358,690 6,693,289 - 7,100,372
- - - - 543,614 2,999,691
- - 7,364 - - 7,364
9,315 1,790 3,137 113 - 491,282
96,956 212,296 - - - 1,071,451
- - - - - 331,882
- - - 80,413 - 624,918
106,271 214,086 369,191 6,773,815 543,614 12,626,960
- 128,468 - - - 128,468
- - 521,303 - - 521,303
275,833 - - 7,216,262 300,211 10,441,023
- - - - - 735,213
- 37,816 6,224 - - 77,561
4,356 - - - - 4,356
280,189 166,284 527,527 7,216,262 300,211 11,907,924
(173,918) 47,802 (158,336) (442,447) 243,403 719,036
- - - 23,868 - 1,359,249
- - - - (485,381) (509,249)
- - - 23,868 (485,381) 850,000
(173,918) 47,802 (158,336) (418,579) (241,978) 1,569,036
1,813,726 614,641 450,930 427,183 400,331 51,677,816
1,639,808 $ 662,443 $ 292,594 $ 8,604 $ 158,353 $ 53,246,852 $
(Continued)
Special Revenue Funds
129
Combining Statement of Revenues, Expenditures and Changes in Fund Balances
Nonmajor Governmental Funds (Continued)
For the Year Ended June 30, 2018
Grants
Assessment Bridge and and Other
and Other Thoroughfare Gas Capital
Districts Districts Tax Project Funds
Revenues:
Taxes -$ -$ 3,087,527 $ -$
Intergovernmental - - - 64,053
Charges for services - - - -
Fines and forfeitures - - - -
Income from property and investments 19,703 42,971 44,479 786
Contributions from property owners 50,000 267,000 278,904 359,680
Donations - - - -
Miscellaneous - - - -
Total revenues 69,703 309,971 3,410,910 424,519
Expenditures:
Current:
General government 378,340 - - 43,262
Public safety - - - -
Community services - - - -
Public works - - 600,000 -
Capital outlay - 32,732 2,263,357 980,976
Debt service:
Interest and fiscal charges - - - -
Total expenditures 378,340 32,732 2,863,357 1,024,238
Excess (deficiency) of revenues
over (under) expenditures (308,637) 277,239 547,553 (599,719)
Other financing sources (uses):
Transfers in - - - -
Transfers out - (174,400) (10,000) -
Total other financing sources (uses)- (174,400) (10,000) -
Net change in fund balances (308,637) 102,839 537,553 (599,719)
Fund balances at beginning of year 3,151,845 11,830,835 12,631,707 1,335,119
Fund balances at end of year 2,843,208 $ 11,933,674 $ 13,169,260 $ 735,400 $
Capital Project Funds
130
Planned
Local Traffic Total Other
Drainage Sales Tax/Impact Governmental
Facilities TransNet Projects Totals Funds
-$ -$ -$ 3,087,527 $ 3,087,527 $
- 3,136,166 - 3,200,219 10,300,591
- 1,112,952 - 1,112,952 4,112,643
- - - - 7,364
24,129 20,034 50,483 202,585 693,867
157,797 - 3,009,437 4,122,818 5,194,269
- - - - 331,882
- - - - 624,918
181,926 4,269,152 3,059,920 11,726,101 24,353,061
- 109,980 - 531,582 660,050
- - - - 521,303
- - - - 10,441,023
- - - 600,000 1,335,213
286,812 5,144,046 624,181 9,332,104 9,409,665
-
- - - - 4,356
286,812 5,254,026 624,181 10,463,686 22,371,610
(104,886) (984,874) 2,435,739 1,262,415 1,981,451
- - - - 1,359,249
- - - (184,400) (693,649)
- - - (184,400) 665,600
(104,886) (984,874) 2,435,739 1,078,015 2,647,051
6,629,380 6,033,771 16,049,719 57,662,376 109,340,192
6,524,494 $ 5,048,897 $ 18,485,458 $ 58,740,391 $ 111,987,243 $
131
Combining Schedule of Revenues and Expenditures
Budget and Actual (Budgetary Basis)
Special Revenue Funds
Year Ended June 30, 2018
Actual
Amounts Variance
(Budgetary Over
Budget Basis)(Under)
Affordable Housing
Total revenues 1,602,000 $ 1,762,114 $ 160,114 $
Total expenditures 1,045,921 369,571 (676,350)
Net change in fund balance 556,079 1,392,543 836,464
Community Development Block Grant
Total revenues 210,100 229,046 18,946
Total expenditures 830,844 336,776 (494,068)
Net change in fund balance (620,744) (107,730) 513,014
Donations
Total revenues 400,500 371,227 (29,273)
Total expenditures 1,058,382 386,042 (672,340)
Net change in fund balance (657,882) (14,815) 643,067
Financing Districts
Total revenues 3,313,300 2,579,847 (733,453)
Total expenditures 3,588,827 2,806,546 (782,281)
Net change in fund balance (275,527) (226,699) 48,828
Habitat and Agricultural Management
Total revenues 76,000 127,077 51,077
Total expenditures 404,954 280,189 (124,765)
Net change in fund balance (328,954) (153,112) 175,842
Other Special Revenue Funds
Total revenues 333,000 221,552 (111,448)
Total expenditures 320,345 309,282 (11,063)
Net change in fund balance 12,655 (87,730) (100,385)
(Continued)
132
Combining Schedule of Revenues and Expenditures
Budget and Actual (Budgetary Basis)
Special Revenue Funds (Continued)
Year Ended June 30, 2018
Actual
Amounts Variance
(Budgetary Over
Budget Basis)(Under)
Police Grants and Asset Forfeiture
Total revenues 795,609 $ 374,026 $ (421,583) $
Total expenditures 1,194,470 1,097,794 (96,676)
Net change in fund balance (398,861) (723,768) (324,907)
Section 8 Rental Assistance
Total revenues 6,760,500 6,773,817 13,317
Total expenditures 7,379,411 7,216,262 (163,149)
Net change in fund balance (618,911) (442,445) 176,466
Totals
Total revenues 13,491,009 12,438,706 (1,052,303)
Total expenditures 15,823,154 12,802,462 (3,020,692)
Net change in fund balance (2,332,145) $ (363,756) $ 1,968,389 $
133
Combining Schedule of Revenues and Expenditures
Budget and Actual (Budgetary Basis)
Capital Project Funds
Year Ended June 30, 2018
Actual
Amounts Variance
(Budgetary Over
Budget Basis)(Under)
Parking-in-Lieu (Grants and Other Capital Project Funds)
Total revenues 143,000 $ 371,602 $ 228,602 $
Total expenditures 44,288 43,262 (1,026)
Net change in fund balance 98,712 $ 328,340 $ 229,628 $
134
This
p
a
g
e is intentionally left blank.
135
Combining Statement of Net Position
Internal Service Funds
June 30, 2018
Fleet Self Insured
ASSETS Management Benefits
Current assets:
Cash and investments 17,918,155 $ 5,983,090 $
Receivables:
Interest 78,736 -
Accounts, net of allowances 11,523 -
Inventories 396,422 -
Total current assets 18,404,836 5,983,090
Noncurrent assets:
Capital assets:
Machinery and equipment 23,260,554 -
Intangible assets - -
Less accumulated depreciation (12,842,517) -
Total capital assets (net of accumulated
depreciation)10,418,037 -
Total noncurrent assets 10,418,037 -
Total assets 28,822,873 5,983,090
DEFERRED OUTFLOWS OF RESOURCES
Deferred outflows of resources - OPEB related items 6,211 -
Deferred outflows of resources - pension related items 425,324 -
Total deferred outflows of resources 431,535 -
LIABILITIES
Current liabilities:
Accrued liabilities 196,936 3,971,285
Estimated claims payable - 102,167
Current portion of long-term debt - -
Total current liabilities 196,936 4,073,452
Noncurrent liabilities:
Deposits payable - -
Net OPEB liability 18,508 -
Net pension liability 1,496,531 -
Capital lease payable - -
Total noncurrent liabilities 1,515,039 -
1,711,975 4,073,452
DEFERRED INFLOWS OF RESOURCES
Deferred inflows of resources - OPEB related items 2,840 -
Deferred inflows of resources - pension related items 67,827 -
Total deferred inflows of resources 70,667 -
NET POSITION
Net investment in capital assets 10,418,037 -
Unrestricted 17,053,729 1,909,638
27,471,766 $ 1,909,638 $
Total liabilities
Total net position
136
Information Risk Workers’
Technology Management Compensation Total
7,757,632 $ 3,950,995 $ 10,792,902 $ 46,402,774 $
33,440 17,365 47,587 177,128
- - - 11,523
- - - 396,422
7,791,072 3,968,360 10,840,489 46,987,847
5,170,825 - - 28,431,379
1,689,637 - - 1,689,637
(4,432,113) - - (17,274,630)
2,428,349 - - 12,846,386
2,428,349 - - 12,846,386
10,219,421 3,968,360 10,840,489 59,834,233
19,204 1,197 513 27,125
1,693,969 143,681 71,248 2,334,222
1,713,173 144,878 71,761 2,361,347
569,180 110,957 16,063 4,864,421
- 2,322,117 8,441,148 10,865,432
198,810 - - 198,810
767,990 2,433,074 8,457,211 15,928,663
- 1,000 - 1,000
57,221 3,566 1,528 80,823
5,741,794 417,400 254,512 7,910,237
359,067 - - 359,067
6,158,082 421,966 256,040 8,351,127
6,926,072 2,855,040 8,713,251 24,279,790
8,781 547 235 12,403
399,345 3,313 31,009 501,494
408,126 3,860 31,244 513,897
1,870,472 - - 12,288,509
2,727,924 1,254,338 2,167,755 25,113,384
4,598,396 $ 1,254,338 $ 2,167,755 $ 37,401,893 $
137
Combining Statement of Revenues, Expenses and Changes in Net Position
Internal Service Funds
For the Year Ended June 30, 2018
Fleet Self Insured
Management Benefits
Operating revenues:
Other charges for services 4,751,759 $ 863,426 $
Miscellaneous 40,209 -
Total operating revenues 4,791,968 863,426
Operating expenses:
Depreciation 1,612,229 -
Fuel and supplies 1,275,921 -
Claims and premiums expense - 746,569
Small equipment purchases 3,950 -
General and administrative 1,477,672 -
Total operating expenses 4,369,772 746,569
Operating income (loss)422,196 116,857
Nonoperating revenues (expenses):
Income from property and investments 71,458 -
Interest expense - -
Gain (loss) on sale of property 68,737 -
Total nonoperating revenues (expenses)140,195 -
Income (loss) before transfers and
capital contributions 562,391 116,857
Transfers in 440,216 -
Capital contributions 1,135,618 -
Change in net position 2,138,225 116,857
Total net position at beginning of year, as restated 25,333,541 1,792,781
Total net position at end of year 27,471,766 $ 1,909,638 $
138
Information Risk Workers’
Technology Management Compensation Totals
8,919,400 $ 1,991,540 $ 2,731,260 $ 19,257,385 $
- 35,655 75,081 150,945
8,919,400 2,027,195 2,806,341 19,408,330
730,057 - - 2,342,286
- - - 1,275,921
- 1,685,632 4,169,362 6,601,563
977,010 - - 980,960
7,228,752 249,979 192,037 9,148,440
8,935,819 1,935,611 4,361,399 20,349,170
(16,419) 91,584 (1,555,058) (940,840)
25,158 15,877 38,340 150,833
(39,745) - - (39,745)
- - - 68,737
(14,587) 15,877 38,340 179,825
(31,006) 107,461 (1,516,718) (761,015)
- - 1,500,000 1,940,216
- - - 1,135,618
(31,006) 107,461 (16,718) 2,314,819
4,629,402 1,146,877 2,184,473 35,087,074
4,598,396 $ 1,254,338 $ 2,167,755 $ 37,401,893 $
139
Combining Statement of Cash Flows
Internal Service Funds
For the Year Ended June 30, 2018
Fleet Self Insured
Management Benefits
Cash flows from operating activities:
Receipts from customers and users 4,787,529 $ 863,426 $
Payments to suppliers (1,664,875) -
Payments to employees (810,396) -
Internal activity - payments to other funds (142,350) -
Claims and premiums paid - (818,943)
Net cash provided by (used in) operating activities 2,169,908 44,483
Cash flows from noncapital financing activities:
Operating subsidies and transfers (to) from other funds 440,216 -
Cash flows from capital and related financing activities:
Purchase of capital assets (3,181,123) -
Gross proceeds from the sale of capital assets 97,917 -
Principal paid on capital debt - -
Interest expense - -
Net cash provided by (used in) capital and related
financing activities (3,083,206) -
Cash flows from investing activities:
Interest on investments 55,594 -
Net increase (decrease) in cash and cash equivalents (417,488) 44,483
Cash and cash equivalents at beginning of year 18,335,643 5,938,607
Cash and cash equivalents at end of year 17,918,155 $ 5,983,090 $
140
Information Risk Workers’
Technology Management Compensation Total
8,919,400 $ 2,027,195 $ 2,806,341 $ 19,403,891 $
(4,957,948) (68,617) - (6,691,440)
(3,713,458) (268,371) (123,501) (4,915,726)
(49,632) (22,419) (1,960) (216,361)
- (2,320,396) (3,084,764) (6,224,103)
198,362 (652,608) (403,884) 1,356,261
- - 1,500,000 1,940,216
(80,624) - - (3,261,747)
- - - 97,917
(187,223) - - (187,223)
(39,745) - - (39,745)
(307,592) - - (3,390,798)
18,441 14,249 23,921 112,205
(90,789) (638,359) 1,120,037 17,884
7,848,421 4,589,354 9,672,865 46,384,890
7,757,632 $ 3,950,995 $ 10,792,902 $ 46,402,774 $
(Continued)
141
Combining Statement of Cash Flows
Internal Service Funds (Continued)
For the Year Ended June 30, 2018
Fleet Self Insured
Management Benefits
Reconciliation of operating income (loss) to net cash
provided by (used in) operating activities:
Operating income (loss)422,196 $ 116,857 $
Adjustments to reconcile operating income to net cash
provided by operating activities:
Depreciation and amortization 1,612,229 -
Change in assets and liabilities:
(Increase) decrease in receivables (4,439) -
(Increase) in inventories (3,808) -
(Increase) in prepaid items - -
(Increase) in deferred outflows - OPEB related items (6,211) -
(Increase) in deferred outflows - pension related items (65,065) -
Increase (decrease) in accrued liabilities (1,878) (69,283)
Increase (decrease) in estimated claims payable - (3,091)
Increase (decrease) in net OPEB liability 3,539 -
Increase (decrease) in net pension liability 175,966 -
Increase (decrease) in deferred inflows - OPEB related items 2,840 -
Increase (decrease) in deferred inflows - pension related items 34,539 -
Net cash provided by (used in) operating activities 2,169,908 $ 44,483 $
Noncash capital financing activities:
Capital assets contributed by other funds 1,135,618 $ -$
142
Information Risk Workers’
Technology Management Compensation Total
(16,419) $ 91,584 $ (1,555,058) $ (940,840) $
730,057 - - 2,342,286
- - - (4,439)
- - - (3,808)
- - - -
(19,204) (1,197) (513) (27,125)
(362,584) (55,454) (17,542) (500,645)
(23,243) (25,624) (3,816) (123,844)
- (612,524) 1,085,599 469,984
10,940 682 292 15,453
203,022 (48,123) 64,503 395,368
8,781 547 235 12,403
(332,988) (2,499) 22,416 (278,532)
198,362 $ (652,608) $ (403,884) $ 1,356,261 $
-$ -$ -$ 1,135,618 $
143
Combining Statement of Changes in Assets and Liabilities
Agency Funds
For the Year Ended June 30, 2018
Contractors’ and Miscellaneous Deposits
Balance Balance
ASSETS July 1, 2017 Additions Deductions June 30, 2018
Current assets:
Cash and investments 13,136,938 $ 56,276,886 $ 54,814,650 $ 14,599,174 $
Receivables:
Interest 42,100 60,735 42,100 60,735
Taxes - 34 34 -
Other - 44,451 26,879 17,572
Prepaid items 4,129 2,639 4,129 2,639
Total current assets 13,183,167 $ 56,384,745 $ 54,887,792 $ 14,680,120 $
LIABILITIES
Accrued liabilities 884,329 $ 56,489,539 $ 56,562,109 $ 811,759 $
Deposits held for others 12,298,838 5,124,183 3,554,660 13,868,361
Total liabilities 13,183,167 $ 61,613,722 $ 60,116,769 $ 14,680,120 $
Assessment Districts
Balance Balance
ASSETS July 1, 2017 Additions Deductions June 30, 2018
Current assets:
Cash and investments 5,932,560 $ 6,463,909 $ 5,808,658 $ 6,587,811 $
Receivables:
Interest 67,203 78,953 67,205 78,951
Taxes 932 4,030 932 4,030
Other 9,247 17,360 9,247 17,360
Total current assets 6,009,942 6,564,252 5,886,042 6,688,152
Restricted assets:
Cash and investments 5,124,822 - - 5,124,822
Total restricted assets 5,124,822 - - 5,124,822
Total assets 11,134,764 $ 6,564,252 $ 5,886,042 $ 11,812,974 $
LIABILITIES
Accrued liabilities 50,682 $ 25,123 $ 23,081 $ 52,724 $
Deposits held for others 11,084,082 6,002,682 5,326,514 11,760,250
Total liabilities 11,134,764 $ 6,027,805 $ 5,349,595 $ 11,812,974 $
(continued)
144
Combining Statement of Changes in Assets and Liabilities
Agency Funds (continued)
For the Year Ended June 30, 2018
Total Agency Funds
Balance Balance
ASSETS July 1, 2017 Additions Deductions June 30, 2018
Current assets:
Cash and investments 19,069,498 $ 62,740,795 $ 60,623,308 $ 21,186,985 $
Receivables:
Interest 109,303 139,688 109,305 139,686
Taxes 932 4,064 966 4,030
Other 9,247 61,811 36,126 34,932
Prepaid items 4,129 2,639 4,129 2,639
Total current assets 19,193,109 62,948,997 60,773,834 21,368,272
Restricted assets:
Cash and investments 5,124,822 - - 5,124,822
Total current assets 5,124,822 - - 5,124,822
Total assets 24,317,931 $ 62,948,997 $ 60,773,834 $ 26,493,094 $
LIABILITIES
Accrued liabilities 935,011 $ 56,514,662 $ 56,585,190 $ 864,483 $
Deposits held for others 23,382,920 11,126,865 8,881,174 25,628,611
Total liabilities 24,317,931 $ 67,641,527 $ 65,466,364 $ 26,493,094 $
145
Statement of Fiduciary Net Position
Private Purpose Trust Fund
June 30, 2018
Redevelopment
Obligation
Retirement
ASSETS Trust Fund
Current assets:
Cash and investments 1,200,340 $
Receivables:
Interest 13,826
Total current assets 1,214,166
Noncurrent assets:
Loans receivable 3,750,000
Total assets 4,964,166
LIABILITIES
Current liabilities:
Accrued liabilities 2,211
Accrued interest payable 93,280
Current portion of long-term debt 775,000
Total current liabilities 870,491
Noncurrent liabilities:
Due to the City of Carlsbad 9,103,922
Tax allocation bonds payable 4,520,000
Total noncurrent liabilities 13,623,922
Total liabilities 14,494,413
NET POSITION
Held in trust for redevelopment
obligation retirement purposes (9,530,247) $
146
Changes in Fiduciary Net Position
Private Purpose Trust Fund
For the Year Ended June 30, 2018
Redevelopment
Retirement
Obligation
ADDITIONS Trust Fund
Contributions:
Redevelopment Property Tax Trust Fund (RPTTF) revenues 3,589,291 $
Income from property and investments 15,011
Total additions 3,604,302
DEDUCTIONS
General and administrative 612,386
Interest expense and fees 469,394
Total deductions 1,081,780
Change in net position 2,522,522
Total net position (deficit) at beginning of year (12,052,769)
Total net position (deficit) at end of year (9,530,247) $
147
This
p
a
g
e is intentionally left blank.
148
Statistical Section
Statistical Section
Statistical SectionStatistical Section
149
Statistical Section
This section of the City of Carlsbad’s Comprehensive Annual Financial Report presents detailed information as a context
for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the city’s overall financial health.
Table of Contents Page
Financial Trends 150
These schedules contain trend information to help the reader understand how the city’s financial
performance and well-being have changed over time.
Revenue Capacity 161
These schedules contain information to help the reader assess the city’s water and wastewater revenue sources as well as the city’s most significant local revenue source, property taxes.
Debt Capacity 174
These schedules present information to help the reader assess the affordability of the city’s current levels
of outstanding debt, and the city’s ability to issue additional debt in the future.
Demographic and Economic Information 178
These schedules offer demographic and economic indicators to help the reader understand the
environment within which the city’s financial activities take place.
Operating Information 182
These schedules contain service and infrastructure data to help the reader understand how the
information in the city’s financial report relates to the services the city provides and the activities it
performs.
Sources: Unless otherwise noted, the information in these schedules is derived from the Comprehensive Annual
Financial Reports for the relevant year.
Net Position by Component
Last Ten Fiscal Years
(dollars in thousands)
2009 2010 2011 2012 2013
Governmental activities
Net investment in capital assets 742,500$ 767,719$ 774,269$ 780,727$ 782,500$
Restricted for:
Capital assets 186,597 178,669 184,419 192,713 182,685
Lighting and landscaping districts 2,196 2,827 2,133 2,246 2,958
Affordable housing 35,330 36,187 40,005 38,434 37,390
Habitat and agricultural mitigation management 7,115 6,600 5,377 4,799 2,665
Other purposes 2,412 2,710 5,298 4,022 3,685
Unrestricted 268,779 279,737 284,825 308,470 (1)319,317
Total governmental activities net position 1,244,929$ 1,274,449$ 1,296,326$ 1,331,411$ 1,331,200$
Business-type activities
Net investment in capital assets 308,440$ 317,238$ 314,691$ 311,392$ 307,000$
Restricted for:
Capital assets 43,167 44,241 44,954 45,522 45,990
Unrestricted 28,469 34,556 38,278 47,530 55,758
Total business-type activities net position 380,076$ 396,035$ 397,923$ 404,444$ 408,748$
Total government
Net investment in capital assets 1,050,940$ 1,084,957$ 1,088,960$ 1,092,119$ 1,089,500$
Restricted for:
Capital assets 229,764 222,910 229,373 238,235 228,675
Lighting and landscaping districts 2,196 2,827 2,133 2,246 2,958
Affordable housing 35,330 36,187 40,005 38,434 37,390
Habitat and agricultural mitigation management 7,115 6,600 5,377 4,799 2,665
Other purposes 2,412 2,710 5,298 4,022 3,685
Unrestricted 297,248 314,293 323,103 356,000 375,075
Total net position 1,625,005$ 1,670,484$ 1,694,249$ 1,735,855$ 1,739,948$
Source: City of Carlsbad Comprehensive Annual Financial Reports
(1) The significant increase in FY 2011-12 is due to the dissolution of the city's Redevelopment Agency which created a large
extraordinary gain for the year.
(2) Net position for the prior year was restated in FY 2014-15, to reflect the application of GASB 68.
150
2014 2015 2016 2017 2018
784,210$ 783,298$ 788,035$ 788,078$ 793,090$
175,468 178,228 176,279 183,245 182,811
4,703 5,263 5,921 6,527 7,307
39,317 39,544 40,390 40,528 41,500
1,713 1,708 1,758 1,805 1,640
3,774 3,059 2,948 2,818 2,800
328,602 223,522 245,078 249,816 262,023
1,337,787$ (2)1,234,622$ (2)1,260,409$ 1,272,817$ 1,291,171$
305,681$ 307,122$ 317,927$ 344,836$ 349,548$
46,632 47,315 45,950 40,098 39,522
66,083 69,922 73,285 85,153 88,576
418,396$ (2)424,359$ (2)437,162$ 470,087$ 477,646$
1,089,891$ 1,090,420$ 1,105,962$ 1,132,914$ 1,142,638$
222,100 225,543 222,229 223,343 222,333
4,703 5,263 5,921 6,527 7,307
39,317 39,544 40,390 40,528 41,500
1,713 1,708 1,758 1,805 1,640
3,774 3,059 2,948 2,818 2,800
394,685 293,444 318,363 334,969 350,599
1,756,183$ 1,658,981$ 1,697,571$ 1,742,904$ 1,768,817$
151
Changes in Net Position
Last Ten Fiscal Years
(dollars in thousands)
2009 2010 2011 2012 2013
Expenses
Governmental activities
General government 12,859$ 23,038$ (1)16,907$ 16,675$ 23,574$ (4)
Public safety 44,632 44,371 45,011 45,576 48,468
Community services 36,438 37,675 42,179 43,087 47,900 (5)
Public works 35,190 35,383 25,759 28,441 36,806
Interest and fiscal charges on long-term debt 588 547 453 298 4
Total governmental activities 129,707 141,014 130,309 134,077 156,752
Business-type activities
Carlsbad Municipal Water District 30,134 33,923 34,978 35,985 41,626
Golf course 13,040 11,927 11,538 11,190 10,668
Wastewater 11,836 10,434 11,751 11,330 13,556
Solid waste 2,580 2,535 2,565 2,922 2,918
Total business-type activities 57,590 58,819 60,832 61,427 68,768
Total government 187,297$ 199,833$ 191,141$ 195,504$ 225,520$
Program Revenues
Governmental activities
Charges for services:
General government 847$ 341$ 1,793$ 315$ 1,469$
Public safety 4,591 4,358 4,502 4,379 4,025
Community services 5,177 6,199 7,266 6,314 6,987
Public works 3,573 4,196 3,567 3,717 5,073
Operating grants and contributions 12,120 11,445 12,033 11,813 13,199
Capital grants and contributions 27,722 32,459 13,557 15,429 17,741
Total governmental activities 54,030 58,998 42,718 41,967 48,494
Business-type activities
Charges for services:
Carlsbad Municipal Water District 24,574 29,865 30,715 35,776 44,240 (6)
Golf course 5,801 5,625 5,850 6,127 6,278
Wastewater 8,531 9,580 10,053 10,989 12,402
Solid waste 3,032 2,988 3,015 2,961 3,060
Operating grants and contributions 1,824 1,734 1,263 1,201 38
Capital grants and contributions 14,612 17,882 5,640 4,560 2,855
Total business-type activities 58,374 67,674 56,536 61,614 68,873
Total government 112,404$ 126,672$ 99,254$ 103,581$ 117,367$
Net (Expense)/Revenue:
Governmental activities (75,677)$ (82,016)$ (87,591)$ (92,110)$ (108,258)$
Business-type activities 784 8,855 (4,296) 187 105
Total government net expense (74,893)$ (73,161)$ (91,887)$ (91,923)$ (108,153)$
152
2014 2015 2016 2017 2018
20,187$ 16,108$ 16,147$ 18,374$ 25,192$ (11)
48,942 48,856 50,463 55,994 62,630 (11)
45,341 48,630 51,191 54,212 51,897
30,314 36,273 37,464 34,317 36,875
1 - 1 3 2
144,785 149,867 155,266 162,900 176,596
43,547 40,897 39,458 45,219 51,658
11,032 10,538 10,545 10,211 10,560
12,488 12,629 12,613 12,626 13,495
2,856 2,973 2,997 3,272 3,089
69,923 67,037 65,613 71,328 78,802
214,708$ 216,904$ 220,879$ 234,228$ 255,398$
289$ 1,382$ 296$ 327$ 816$
3,950 4,220 3,980 4,647 4,805
8,732 10,534 10,711 12,154 11,588
3,720 4,014 4,152 3,952 3,768
11,919 12,242 11,912 12,630 13,054
16,129 19,105 12,042 (8)22,789 22,993
44,739 51,497 43,093 56,499 57,024
46,750 47,461 39,854 (9)44,817 50,095
6,635 6,709 6,988 7,119 7,973
12,896 12,875 12,963 13,467 13,885
3,320 3,245 3,206 3,302 3,427
90 59 5,646 2,471 1,611
3,198 5,879 2,011 13,322 5,484
72,889 76,228 70,668 84,498 82,475
117,628$ 127,725$ 113,761$ 140,997$ 139,499$
(100,046)$ (98,370)$ (112,173)$ (106,401)$ (119,572)$
2,966 9,191 5,055 13,170 3,673
(97,080)$ (89,179)$ (107,118)$ (93,231)$ (115,899)$
(Continued)
153
Changes in Net Position (Continued)
Last Ten Fiscal Years
(dollars in thousands)
2009 2010 2011 2012 2013
General Revenues and Other Changes in Net Position
Governmental activities
Taxes:
Property taxes 55,338$ 55,113$ 54,049$ 51,538$ 52,861$
Sales and use taxes 23,098 23,031 25,660 28,094 28,403
Transient occupancy taxes 12,752 11,490 11,569 12,872 14,702
Franchise taxes 5,274 4,906 4,650 4,852 5,118
Business license taxes 3,422 3,458 3,581 2,695 3,834
Real property transfer taxes 621 758 911 925 1,058
Vehicle license fees 353 309 483 53 (2)55
Income from property and investments 19,828 12,523 8,372 6,088 1,792
Other general revenues 359 391 328 419 426
Extraordinary gain/(loss)- - - 20,477 (3)-
Transfers (127) (443) (135) (1,810) (656)
Total governmental activities 120,918 111,536 109,468 126,203 107,593
Business type activities
Property taxes 2,861 2,822 2,779 2,721 2,904
Income from property and investments 5,908 3,686 2,109 2,054 555
Other general revenues 209 153 3,599 106 85
Transfers 127 443 135 1,810 655
Total business-type activities 9,105 7,104 8,622 6,691 4,199
Total government 130,023$ 118,640$ 118,090$ 132,894$ 111,792$
Change in Net Position
Governmental activities 45,241$ 29,520$ 21,877$ 34,093$ (665)$
Business-type activities 9,889 15,959 4,326 6,878 4,304
Total government 55,130$ 45,479$ 26,203$ 40,971$ 3,639$
Source: City of Carlsbad Comprehensive Annual Financial Reports
(1) The large increase in general government expenses in FY 2009-10 is primarily a result of a refund of over $10 million in excess
development fees paid by Rancho Santa Fe Road property owners.
(2) The State of California ceased sending the city vehicle license fee revenues in FY 2011-12.
(3) The extraordinary gain in FY 2011-12 resulted from the transfers of the assets and liabilities of the former Redevelopment Agency to
Successor Agency trust funds.
(4) The large increase in FY 2012-13 includes a repayment to SANDAG of $1.4 million in excess Transnet Funds on inactive/closed
projects and a transfer of $4.5 million in surplus construction funds from the Poinsettia Lane Assessment District to be used in the
refunding of Reassessment District No. 2012-1.
(5) The large increase in FY 2012-13 includes a $3.8 million transfer of an affordable housing loan receivable to the Successor Housing
Agency trust fund as required by the California Department of Finance.
(6) The increase in FY 2012-13 was the result of a combination of a five percent increase in the number of water units sold coupled with
an average eight percent increase in water rates charged to customers and a reimbursement from a lawsuit involving a landslide.
(7) The extraordinary loss in FY 2013-14 resulted from the restatement of accrued interest on prior year advances made by the city to
the Successor Housing Agency per California state mandate.
(8) The decrease in FY 2015-16 was a result of one-time funds received from the federal government in the previous fiscal year for the
2014 Poinsettia Fire, as well as the receipt of retroactive mandated cost reimbursements.
(9) The decrease in FY 2015-16 was a result of a decrease in water sales during the fiscal year from drought conservation measures.
(10) The increase in FY 2015-16 is a result of higher cash balances that generate interest, an increase in investment earnings, and
interest received from the California Department of Finance earned on unpaid mandated costs.
(11) The increase in FY 2017-18 is mainly due to changes in the city's pension discount rate.
154
2014 2015 2016 2017 2018
52,608$ 55,992$ 58,945$ 63,988$ 66,524$
30,520 32,146 34,843 33,999 33,674
17,472 19,713 20,943 22,267 24,233
4,907 5,427 5,632 5,475 5,812
4,177 4,548 4,895 4,328 5,026
1,080 1,406 1,546 1,393 1,463
- - - - -
6,917 4,564 11,910 (10)1,975 2,551
429 609 486 451 519
(10,289) (7)- - - -
(1,188) (1,264) (1,240) (15,067) (136)
106,633 123,141 137,960 118,809 139,666
2,897 3,133 3,306 3,569 3,743
2,498 1,870 3,163 749 986
99 623 39 370 3
1,188 1,264 1,240 15,067 136
6,682 6,890 7,748 19,755 4,868
113,315$ 130,031$ 145,708$ 138,564$ 144,534$
6,587$ 24,771$ 25,787$ 12,408$ 20,094$
9,648 16,081 12,803 32,925 8,541
16,235$ 40,852$ 38,590$ 45,333$ 28,635$
155
Fund Balances of Governmental Funds
Last Ten Fiscal Years
(dollars in thousands)
2009 2010 2011 (2)2012 2013
General Fund
Reserved 59,303$ 59,586$ -$ -$ -$
Unreserved 66,302 68,935 - - -
Nonspendable - - 53,943 54,228 57,719
Restricted - - - - -
Committed - - 1,000 1,000 1,000
Assigned - - 23,584 22,955 26,200
Unassigned - - 57,533 61,384 69,578
Total General Fund 125,605$ 128,521$ 136,060$ 139,567$ 154,497$
All Other Governmental Funds
Reserved 34,573$ 50,617$ -$ -$ -$
Unreserved, reported in:
Special revenue funds 40,207 41,449 - - -
Debt service funds (11,150) (17,824) - - -
Capital project funds 276,183 262,612 (1)- - -
Nonspendable
Special revenue funds - - 433 440 435
Debt service funds - - - - -
Capital project funds - - 250 - -
Restricted
Special revenue funds - - 65,585 64,401 61,938
Debt service funds - - - - -
Capital project funds - - 171,214 177,372 167,009 (4)
Committed
Special revenue funds - - - - -
Debt service funds - - - - -
Capital project funds - - - - -
Assigned
Special revenue funds - - - - -
Debt service funds - - - - -
Capital project funds - - 123,473 123,465 121,861
Unassigned
Special revenue funds - - - - -
Debt service funds - - (18,658) - (3)-
Capital project funds - - - - -
Total all other governmental funds 339,813$ 336,854$ 342,297$ 365,678$ 351,243$
Source: City of Carlsbad Comprehensive Annual Financial Reports
(1) The large decrease in FY 2009-10 in the unreserved fund balance in the capital project funds is primarily a result of
a refund of over $10 million in excess development fees paid by Rancho Santa Fe Road property owners.
(2) GASB 54, which requires changes in the reporting categories for fund balances, was implemented in FY 2010-11.
(3) AB1x26 and AB 1484 were implemented in FY 2011-12. The former Redevelopment Agency debt service funds were
transferred to trust funds.
(4) The large decreases in the restricted fund balance in the capital projects fund is a result of increased expenditures
during FY 2012-13 and 2013-14 for the construction of Alga Norte Community Park.
(5) Beginning in FY 2015-16, the Gas Tax fund balance was reclassified from a Special Revenue fund to a Capital Project
fund.
156
2014 2015 2016 2017 2018
-$ -$ -$ -$ -$
- - - - -
56,707 56,381 55,324 53,751 51,628
- - - - -
1,000 1,000 1,000 1,000 1,000
27,838 40,865 42,692 38,439 43,855
75,615 80,274 94,404 78,191 82,570
161,160$ 178,520$ 193,420$ 171,381$ 179,053$
-$ -$ -$ -$ -$
- - - - -
- - - - -
- - - - -
430 3 4 1 1
- - - - -
- - - - -
66,833 66,300 51,013 (5)51,677 53,246
- - - -
157,712 (4)161,499 176,280 (5)183,245 182,812
- - - - -
- - - - -
- - - - -
- - - - -
- - - - -
131,627 136,237 131,939 146,994 151,306
- - - - -
- - - - -
- - - - -
356,602$ 364,039$ 359,236$ 381,917$ 387,365$
157
Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years
(dollars in thousands)
2009 2010 2011 2012 2013
Revenues:
Taxes 103,874$ 100,249$ 103,660$ 105,595$ 109,447$
Intergovernmental 10,029 12,108 12,847 9,603 11,513
Licenses and permits 1,022 1,484 1,590 1,852 2,016
Charges for services 9,616 10,215 9,938 10,092 10,261
Fines and forfeitures 1,402 1,199 1,051 892 861
Income from property and investments 19,132 12,719 9,278 6,253 2,362
Contributions from property owners 3,117 4,580 5,473 9,927 12,029
Donations 174 203 310 206 411
Miscellaneous 926 1,263 2,521 697 1,969
Total revenues 149,292 144,020 146,668 145,117 150,869
Expenditures:
Current:
General government 12,896 22,778 16,937 16,992 23,072
Less: Interdepartmental charges (3,676) (3,991) (3,015) (3,750) (3,858)
Public safety 45,003 44,686 44,157 44,915 46,162
Community services 33,811 34,765 39,540 40,402 40,899
Public works 23,851 23,851 13,078 11,773 11,299
Capital outlay 22,097 19,727 20,985 17,367 28,602
Debt service:
Principal retirement 1,200 490 515 851 316
Interest and fiscal charges 1,188 1,016 935 308 6
Total expenditures 136,370 143,322 133,132 128,858 146,498
Excess (deficiency) of revenues
over (under) expenditures 12,922 698 13,536 16,259 4,371
Other financing sources (uses):
Proceeds from the sale of property - - - - -
Issuance of debt - - 581 - -
Transfers in 9,101 21,837 9,802 19,887 8,087
Transfers out (9,637) (22,578) (10,937) (23,097) (14,792)
Extraordinary gain (loss)- - - 12,847 (2) -
Total other financing sources (uses)(536) (741) (554) 9,637 (6,705)
Net change in fund balances 12,386$ (43)$ 12,982$ 25,896$ (2,334)$
Debt service as percentage of noncapital
expenditures (1)2.01%1.18%1.26%0.99%0.24%
Source: City of Carlsbad Comprehensive Annual Financial Reports
(1) Noncapital expenditures are total expenditures less capital outlay (to the extent capitalized for the Government-wide
Statement of Net Position) and expenditures for capitalized assets included within the functional expenditure categories.
(2) With the dissolution of Redevelopment Agencies state-wide, the former Redevelopment Agency debt service funds were
transferred to trust funds in FY 2011-12.
(3) Increase in taxes in FY 2014-15 due to growth in property and TOT taxes.
(4) Includes a transfer out to the Golf Course Fund in the amount of $14.8 million for the defeasance of the golf course
construction bonds during FY 2016-17.
158
2014 2015 2016 2017 2018
114,996$ 123,411$ (3) 129,617$ 134,165$ 141,118$
10,602 10,359 11,290 11,963 11,608
2,184 2,369 2,467 3,034 2,999
11,278 13,181 12,913 14,309 14,145
876 837 854 740 679
7,604 6,442 9,970 3,845 4,622
9,042 10,688 8,009 13,330 12,898
210 440 417 349 332
1,219 2,550 1,503 1,467 1,991
158,011 170,277 177,040 183,202 190,392
21,471 17,903 17,221 27,925 26,638
(3,566) (3,807) (3,471) (3,345) (3,160)
47,333 48,915 52,015 57,329 58,568
41,505 44,501 46,298 48,930 49,039
15,442 16,350 17,465 17,349 17,220
18,702 20,050 34,669 17,603 26,885
159 - - -
5 5 6 5 4
141,051 143,917 164,203 165,796 175,194
16,960 26,360 12,837 17,406 15,198
- - - - -
- - - - -
11,477 14,857 9,970 20,849 11,513
(16,415) (16,420) (12,710) (37,613) (4)(13,590)
- - - - -
(4,938) (1,563) (2,740) (16,764) (2,077)
12,022$ 24,797$ 10,097$ 642$ 13,121$
0.13%0.00%0.00%0.00%0.00%
159
General Governmental Tax Revenues by Source
Last Ten Fiscal Years
(dollars in thousands)
Fiscal
Year
Property
Tax *
Sales and
Use Taxes
Transient
Occupancy
Taxes
Franchise
Taxes
Business
License
Taxes
Real
Property
Transfer
Taxes Gas Tax
Total Tax
Revenue
2009 55,338$ 24,765$ 12,752$ 5,274$ 3,422$ 621$ 1,702$ 103,874$
2010 55,113 (1)22,819 (1)11,490 (1)4,906 (1)3,458 758 1,704 100,248
2011 54,049 26,386 11,569 4,650 3,581 911 2,514 103,660
2012 51,538 (2)28,733 (3)12,872 (3)4,852 3,669 925 3,006 (4)105,595
2013 52,888 29,301 14,702 (5)5,118 3,834 1,058 2,546 109,447
2014 52,607 31,464 17,472 (5)4,907 4,178 1,080 3,288 114,996
2015 55,992 (6)33,202 19,713 (7)5,427 4,548 1,406 3,123 123,411
2016 58,946 35,232 20,943 5,632 4,895 1,545 2,424 129,617
2017 63,988 (6)34,543 22,267 (8)5,475 4,328 1,393 2,171 134,165
2018 66,523 34,972 24,234 (9)5,812 5,026 (10)1,463 3,088 (11)141,118
Change
2009-2018 20%41%90%10%47%136%81%36%
(1) Reflects the impact of the economic recession.
(2) Primarily the result of commercial and industrial property reassessments and lower amounts received from delinquent taxes. Beginning
February 1, 2012, tax increment revenue from the former Redevelopment Agency is recorded in the Successor Agency Trust Fund.
(3) Reflects improvement in the economy.
(4) The large increases are due to state Section 2103 allocations which became effective in FY 2011 to allocate funds from a motor vehicle fuel
excise tax that replaced previous city and county allocations from the Proposition 42 sales tax on gasoline.
(5) The increase in TOT in FY 2013 and FY 2014 is due to the opening of two new hotels and higher occupancy and room rates citywide.
(6) Reflects improvement in the housing market and new construction.
(7) The increase in TOT in FY 2015 is due to the openings of several new hotels and higher occupancy and room rates throughout the city.
(8) The increase in TOT in FY 2017 is due to higher room rates throughout most of the city's hotels and an increase in available rooms.
(9) The increase in TOT in FY 2018 is due to higher room rates throughout most of the city's hotels and an opening of a new hotel.
(10) The increase in Business License Taxes in FY 2018 is due to a significant number of delinquent payments being collected.
(11) The increase in Gas Taxes in FY 2018 is due to new ongoing allocations received from the state's Road Maintenance and Rehabilitation Account.
Source: City of Carlsbad Comprehensive Annual Financial Reports
* Includes Vehicle License Fees (VLF) in lieu, property tax increment, low/moderate housing, set aside taxes and CFD No. 1 special taxes.
$0
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
$70,000
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Total General Governmental Tax Revenues -Last Ten Fiscal Years
(in thousands)
Property Tax
Sales and Use Taxes
TOT
Other
Fiscal Year
160
Water and Wastewater Rates
Last Ten Fiscal Years
Wastewater
Fiscal Year
Base Price Per
Unit (1)
Monthly Base
Rate
2009 $14.54 $2.12 $17.65
2010 16.78 2.29 (2)20.93
2011 18.00 2.70 23.03
2012 19.80 2.97 24.53
2013 21.38 3.20 25.02
2014 20.07 3.19 25.52
2015 21.08 3.35 26.03
2016 22.19 3.53 27.81
2017 24.11 3.84 27.81
2018 24.72 3.94 27.81
Source: City of Carlsbad
Note: Rates shown are for a 5/8" meter, which is the standard household meter size.
(1) One unit of water equals 748 gallons.
(2) Tiered rates were implemented starting in FY 2009-10. From that point on, the base price shown is for tier 1,
which applies to the first 12 units of usage per month at a single family residence.
Water
Monthly Delivery
Charge
161
Assessed Value of Taxable Property
Last Ten Fiscal Years
(dollars in millions)
Fiscal
Year
Residential
Property
Commercial
Property
Industrial
Property
Exemptions
and Other
Taxable
Property (1)
Net
Assessed
Valuation
Change
From Prior
Year
Estimated
Property Tax
Revenue (2)
Total Direct
Tax Rate (3)
2009 17,683$ 3,132$ 2,102$ 600$ 23,517$ 6.70%45$ 0.1927%
2010 17,086 3,340 2,192 617 23,235 -1.20%45 0.1927%
2011 16,946 3,355 2,111 601 23,013 -0.96%44 0.1927%
2012 17,306 3,133 1,983 560 22,982 -0.13%44 0.1927%
2013 17,222 3,237 1,884 614 22,957 -0.11%44 0.1927%
2014 17,774 3,298 1,871 580 23,523 2.47%45 0.1927%
2015 19,450 3,603 1,847 589 25,489 8.36%49 0.1927%
2016 20,431 3,973 1,909 612 26,925 5.63%52 0.1927%
2017 21,472 4,238 2,092 622 28,424 5.57%55 0.1927%
2018 22,707 4,355 2,378 555 29,995 5.53%58 0.1927%
(1) Other property includes farm, rural, institutional, recreational, state secured property, unsecured property, personal property and fixtures.
(2) Estimated property tax revenues do not include special assessments, redevelopment tax increment or community facilities district revenues.
Source: County of San Diego, California Auditor and Controller
Notes: Information about estimated actual value of property is not available; the assessed value is based on the most
recent sales value and includes secured property only.
(3) The total direct tax rate is the city's proportionate share of Proposition 13 property taxes collected within the tax rate area.
$0
$5,000
$10,000
$15,000
$20,000
$25,000
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Taxable Assessed Property Value
Last Ten Fiscal Years
(in millions)
Residential Property
Commercial Property
Industrial Property
Fiscal Year
162
Direct and Overlapping Property Tax Rates
Last Ten Fiscal Years
(rate per $100 of assessed value)
Fiscal Year
City of
Carlsbad
Total
Direct
Rate (5)
Carlsbad
Unified
School
District
San Diego
County
Educational
Revenue
Augmentation
Fund
Mira Costa
Community
College
Tri City
Hospital
District
All Other
Rates
Total Prop
13 Rate (2)
Voter
Approved
Debt (3)
Total Tax
Rate (4)
2009 0.01927%0.3412%0.1576%0.1497%0.0937%0.0198%0.0453%1.0000%0.0393%1.0393%
2010 0.1927 0.3412 0.1576 0.1497 0.0937 0.0198 0.0453 1.0000 0.0408 1.0408
2011 0.1927 0.3412 0.1576 0.1497 0.0937 0.0198 0.0453 1.0000 0.0432 1.0432
2012 0.1927 0.3412 0.1576 0.1497 0.0937 0.0198 0.0453 1.0000 0.0748 1.0748
2013 0.1927 0.3412 0.1576 0.1497 0.0937 0.0198 0.0453 1.0000 0.0768 1.0768
2014 0.1927 0.3412 0.1576 0.1497 0.0937 0.0198 0.0453 1.0000 0.0743 1.0743
2015 0.1927 0.3412 0.1576 0.1497 0.0937 0.0198 0.0453 1.0000 0.0710 1.0710
2016 0.1927 0.3412 0.1576 0.1497 0.0937 0.0198 0.0453 1.0000 0.0681 1.0681
2017 0.1927 0.3412 0.1576 0.1497 0.0937 0.0198 0.0453 1.0000 0.0563 1.0563
2018 0.1927 0.3412 0.1576 0.1497 0.0937 0.0198 0.0453 1.0000 0.0791 1.0791
(1) The tax rate history above is for Tax Rate Area 09000, which has the highest total assessed value of the all the tax rate areas in the city.
Tax Rate Area 09000 was chosen as the most representative for the city.
(2) In 1978, California voters passed Proposition 13 which limited property taxes to a total maximum rate of 1.00% based on the assessed
value of each property being taxed. This 1.00% is shared by all taxing agencies within a tax rate area.
Each year, the assessed value of property may be increased by an "inflation factor" (limited to a maximum increase of 2 percent).
With few exceptions, property is only reassessed at the time that it is sold to a new owner. At that point, the purchase price
of the property becomes the new assessed value.
(3) The majority of voter approved debt is related to various school district and hospital bonds.
(4) The Total Tax Rate is the 1.00% Proposition 13 rate plus the Voter Approved Debt rate.
(5) The city has no general obligation bonds; therefore the Basic Tax Rate is the same as the Total Direct Tax Rate.
Allocation of 1% Ad Valorem Property Taxes
Overlapping Rates for Tax Rate Area 09000 (1)
Source: County of San Diego Auditor and Controller's Office
163
Direct and Overlapping Property Tax Rates (Continued)
Last Ten Fiscal Years
(rate per $100 of assessed value)
Total Tax
Rates (2)
County
Tax Rate
Areas (3)
Carlsbad
Unified
Schools
Oceanside
Unified
Schools
San Marcos
Unified
Schools
Vista
Unified
Schools
Encinitas
Union
Schools
Miracosta
Comm.
College
Palomar
Comm.
College
Palomar
Pomerado
Hospital
MWD /
SDCWA
Total Voter
Approved
Rates (1)
1.0562 1 - - - - 0.0417%0.0144%- - - 0.0562%
1.0597 47 - - - - 0.0417 0.0144 - - 0.0035 0.0597
1.0658 3 - - - - 0.0417 - 0.02053 - 0.0035 0.0658
1.0756 3 0.0611 - - - - 0.0144 - - - 0.0756
1.0773 5 - - - 0.05323 - - 0.02053 - 0.0035 0.0773
1.0791 57 0.0611 - - - - 0.0144 - - 0.0035 0.0791
1.0849 2 - - 0.0670 - - 0.0144 - - 0.0035 0.0849
1.0852 3 0.0611 - - - - - 0.02053 - 0.0035 0.0852
1.0910 29 - - 0.0670 - - - 0.02053 - 0.0035 0.0910
1.1001 1 0.0611 - - - - 0.0144 - 0.02100 0.0035 0.1001
1.1059 1 - - 0.0670 - - 0.0144 - 0.02100 0.0035 0.1059
1.1120 11 - - 0.0670 - - - 0.02053 0.02100 0.0035 0.1120
1.1139 1 - 0.09600 0.0000 - - 0.01443 - - 0.0035 0.1139
(1) The majority of voter approved debt is related to various school district and hospital bonds.
(2) The Total Tax Rate is the 1.00% Proposition 13 rate plus the Voter Approved Debt rate.
(3) Tax rate areas are determined by the County of San Diego. There are currently thirteen tax rates distributed among the
164 tax rate areas in the city. The table above shows the number of tax rate areas affected by each of the rates.
Fiscal Year 2017-18 Voter Approved Debt Tax Rates for all Rate Areas
Source: County of San Diego Auditor and Controller's Office
164
Principal Property Taxpayers
Current Year and Nine Years Ago
Taxpayer
Taxable Assessed
Value Rank
Percentage of
Total City Net
Assessed
Value
Taxable Assessed
Value Rank
Percentage of
Total City Net
Assessed
Value
Poseidon Resources 561,360,814$ 1 1.87%--
La Costa Glen Retirement Community 253,391,490 2 0.84%225,954,405 2 0.96%
La Costa Resort & Spa 237,126,463 3 0.79%297,970,970 1 1.27%
Legoland California, LLC 196,899,962 4 0.66%119,588,811 5 0.51%
The Forum Shopping Center 194,668,021 5 0.65%--
The Shoppes at Carlsbad 167,971,540 6 0.56%--
La Costa Town Center, LLC 140,668,434 7 0.47%--
Carlsbad Premium Outlets 124,388,248 8 0.41%111,794,805 6 0.48%
Pacific View Apartments 112,282,022 9 0.37%151,009,237 3 0.64%
The Reserve at Carlsbad Apartments 114,240,000 10 0.38%--
Park Hyatt Aviara Resort --134,771,348 4 0.57%
Grand Pacific Palisades Resort --95,575,471 7 0.41%
Callaway Golf Company --86,215,451 8 0.37%
Borders, Inc.--82,622,135 9 0.35%
Eaves by Avalon Apartment Homes --80,893,173 10 0.34%
Total 2,102,996,994$ 7.01%1,386,395,806$ 5.90%
Net assessed valuation 29,994,964,276$ 23,517,153,047$
Source: County of San Diego Offices of the Auditor and Controller and County Assessor
2018 2009
165
Property Tax Levies and Collections
Last Ten Fiscal Years
Fiscal Year
Total Tax Levy for
Fiscal Year (1)Amount (2)
Percentage of
Levy
Collections in
Subsequent Years Amount
Percentage of
Levy
2009 $59,297,940 $55,759,900 94.03%$1,890,814 $57,650,714 97.22%
2010 58,433,851 55,030,915 94.18%1,354,991 56,385,906 96.50%
2011 56,792,002 53,953,149 95.00%881,967 54,835,116 96.55%
2012 53,682,809 52,778,359 98.32%742,532 53,520,891 99.70%
2013 54,469,819 53,677,921 98.55%564,632 54,242,553 99.58%
2014 55,883,499 55,042,944 98.50%504,599 55,547,543 99.40%
2015 60,266,230 59,509,285 98.74%514,062 59,509,285 98.74%
2016 63,363,527 62,595,504 98.79%432,890 62,595,504 98.79%
2017 67,116,590 66,233,111 98.68%450,663 66,233,111 98.68%
2018 70,221,876 69,383,391 98.81%N/A 69,383,391 98.81%
Source: County of San Diego Office of the Auditor and Controller
(1) Includes real property transfer taxes, homeowner exemptions and Proposition 172 public safety sales taxes.
(2) Total collections include secured, unsecured, homeowners' exception and supplementary amounts distributed by the county.
Collections within the
Fiscal Year of the Levy Total Collections to Date
$0
$20
$40
$60
$80
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Property Tax Levies & Collections
Last Ten Fiscal Years
(in millions)
Total Tax Levy for Fiscal Year (1)
Total Collections to Date
Fiscal Year
166
This
p
a
g
e is intentionally left blank.
167
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
(dollars in thousands except per capita)
Fiscal Year
Bonds / Special
Debt (4)
Certificates of
Participation Capital Leases Loans Payable
2009 10,740 - - -
2010 10,250 - - -
2011 9,735 - - 581
2012 - - - 475
2013 - - - 159
2014 - - - -
2015 - - - -
2016 (5)- - 0.97 -
2017 - - 0.78 -
2018 - - 0.59 -
Sources: MuniServices, LLC, California Department of Finance, and US Census Data
Notes: Details regarding the city's outstanding debt can be found in the notes to the financial statements.
(1) During FY 2006-07, Carlsbad Municipal Golf Course Revenue Bonds were issued for $18.5 million.
(2) The State Water Resources Control Board issued low interest loans for the Carlsbad Water Recycling Facility in 2005.
Varying amounts of principal and interest are due annually. Payments are funded from recycled water user fees.
(3) Percentage of personal income is calculated using per capita personal income beginning in 2011, in prior years the percentage is
calculated using household median income.
(4) The 1993 Carlsbad Housing & Redevelopment Commission Tax Allocation Bonds were transferred to a trust fund due to the dissolution
of the Redevelopment Agency in FY 2011-12.
(5) The Bond/Special Debt is net of amortized premiums and the Loan Payable is net of unamortized discounts.
(6) The Carlsbad Municipal Golf Course Revenue Bonds were defeased during FY 2016-17.
Governmental Activities
$0
$200
$400
$600
$800
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Fiscal Year
Outstanding Debt per Capita
Last Ten Fiscal Years
(in thousands)
168
Bonds / Special
Debt (1)
Installment
Purchase
Agreements
Loan Payable
(2)
Capital
Leases Total
Percentage
of Personal
Income (3)Per Capita
18,265 4,810 27,106 736 61,657 0.84%596.26
17,975 4,105 25,715 502 58,547 0.79%557.30
17,670 3,365 24,290 256 55,897 1.38%524.58
17,345 2,585 22,830 14 43,249 1.00%401.67
17,237 1,697 21,335 - 40,428 0.92%373.48
16,645 905 19,837 - 37,387 0.77%339.36
16,260 - 18,429 - 34,689 0.71%313.49
16,058 - 17,670 - 33,729 0.59%298.67
- (6)- 15,901 - 15,902 0.26%139.83
- - 14,944 - 14,945 0.23%130.38
Business-Type Activities
169
City of Carlsbad
Schedule of Direct and Overlapping Bonded Debt
Current Fiscal Year
Fiscal Year 2017-18 Assessed Valuation:$30,958,184,068
Redevelopment Incremental Valuation:963,219,792
Adjusted Assessed Valuation:$29,994,964,276
Total Debt City’s Share of
Overlapping Tax and Assessment Debt:06/30/18 Debt 6/30/18
Metropolitan Water District 60,600,000$ 1.135%687,810$
Mira Costa Community College District 100,000,000 27.531%27,531,000
Palomar Community College District 627,826,320 2.727%17,120,824
Carlsbad Unified School District 162,011,491 98.090%158,917,072
Carlsbad Unified School District Community Facilities District No 1 1,535,000 100.000%1,535,000
Oceanside Unified School District 227,501,325 0.004%9,100
Vista Unified School District 90,744,882 0.604%548,099
Encinitas Union School District 48,735,453 31.127%15,169,884
San Marcos Unified School District 277,826,759 18.417%51,167,354
San Marcos Unified School District School Facility Improvement District 2,092,874 19.984%418,240
San Marcos Unified School District CFD No. 4 16,520,000 32.779%5,415,091
San Marcos Unified School District CFD No. 5 15,275,000 100.000%15,275,000
San Dieguito Union High School District 336,955,000 9.191%30,969,534
San Dieguito Union HS District CFD No. 94-1 76,626 100.000%76,626
San Dieguito Union HS District CFD No. 94-2 27,756,954 98.160%27,246,226
San Dieguito Union HS District CFD No. 95-2 3,559,626 13.293%473,181
Palomar Health District 436,358,740 1.676%7,313,372
Olivenhain Municipal Water District, Assess. Dist. No. 96-1 10,625,000 22.358%2,375,538
City of Carlsbad CFD No. 3, I.A. No. 1 & No. 2 20,525,000 100.000%20,525,000
City of Carlsbad 1915 Act Bonds 37,195,000 100.000%37,195,000
Total Overlapping Tax and Assessment Debt 2,503,721,050$ 419,968,951$
Overlapping General Fund Obligation Debt:
San Diego County General Fund Obligations 273,220,000$ 6.275%17,144,555$
San Diego County Pension Obligations 558,525,000 6.275%35,047,444
San Diego County Superintendent of Schools General Fund Obligations 10,785,000 6.275%676,759
Mira Costa Community College District Certificates of Participation 555,000 27.531%152,797
Palomar Community College District General Fund Obligations 2,720,000 2.727%74,174
Carlsbad Unified School District General Fund Obligations 44,245,000 98.090%43,399,921
San Marcos Unified School District General Fund Obligations 74,774,457 18.417%13,771,212
Vista Unified School District Certificates of Participation 2,310,000 0.604%13,952
San Dieguito Union High School District General Fund Obligations 12,730,000 9.191%1,170,014
Total Overlapping General Fund Obligation Debt 979,864,457$ 111,450,828$
Overlapping Tax Increment Debt (Successor Agency):6,030,000 100.000%6,030,000 (3)
Total Overlapping Debt:3,489,615,507$ 537,449,779$
City of Carlsbad Direct Debt:
City of Carlsbad Governmental Activities Obligations -$ 0.000%-$
Total City of Carlsbad Direct Debt -$ -$
Combined Total Debt 3,489,615,507$ 537,449,779$ (2)
Source: MuniServices, LLC and County of San Diego Office of the Auditor and Controller
(1) Percentage of overlapping agency's assessed valuation located within boundaries of the city.
(2) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and tax allocation bonds and non-bonded capital lease obligations.
(3) Created by the dissolution of the Redevelopment Agency in FY 2011-12.
Ratios to FY 2017-18 Assessed Valuation:
Total Overlapping Tax and Assessment Debt 1.36%
Ratios to FY 2017-18 Adjusted Assessed Valuation:
Governmental Activities Direct Debt 0.00%
Combined Total Debt 1.79%
Percent
Applicable (1)
170
This
p
a
g
e is intentionally left blank.
171
City of Carlsbad
Direct and Overlapping Debt
Last Ten Fiscal Years
(rate per $1,000 of assessed value)
2009 2010 2011 2012
Overlapping Tax and Assessment Debt:
Metropolitan Water District 0.160$ 0.147$ 0.129$ 0.110$
Mira Costa Community College District - - - -
Palomar Community College District 0.208 0.207 0.447 0.448
Carlsbad Unified School District 5.513 5.401 8.660 8.527
Carlsbad Unified School District CFD No. 1 0.263 0.230 0.192 0.149
Oceanside Unified School District - 0.001 0.001 0.001
Vista Unified School District 0.033 0.043 0.039 0.038
Encinitas Union School District 0.228 0.205 0.357 0.338
San Marcos Unified School District - - - 3.103
San Marcos Unified School District Facility Improvement District 0.250 0.227 0.202 0.176
Palomar Health District 0.389 0.383 0.444 0.434
San Marcos Unified School District CFD No. 4 0.248 0.245 0.241 0.236
San Marcos Unified School District CFD No. 5 1.016 1.000 0.979 0.950
San Dieguito Union High School District - - - -
San Dieguito Union HS District CFD No. 94-1 0.011 0.004 0.004 0.004
San Dieguito Union HS District CFD No. 94-2 0.793 1.105 1.093 1.106
San Dieguito Union HS District CFD No. 95-2 0.004 0.022 0.022 0.022
San Dieguito Union HS District combined CFD 0.626 0.218 0.215 -
Olivenhain Municipal Water District, Assess. Dist. No. 96-1 0.157 0.151 0.147 0.142
City of Carlsbad CFD No. 3, I.A. No. 1 & No. 2 1.246 1.244 1.080 1.063
City of Carlsbad 1915 Act Bonds 2.806 2.685 2.640 2.569
Total Overlapping Tax and Assessment Debt 13.951$ 13.518$ 16.892$ 19.416$
Overlapping General Fund Obligation Debt:
San Diego County General Fund Obligations 1.304$ 1.201$ 1.133$ 1.155$
San Diego County Pension Obligations 2.782 2.470 2.410 2.300
San Diego City Superintendent of Schools General Fund Obligations 0.046 0.061 0.059 0.055
Mira Costa Community College District Certificates of Participation 0.046 0.043 0.036 0.032
Palomar Community College District General Fund Obligations 0.010 0.010 0.009 0.008
Carlsbad Unified School District General Fund Obligations 2.206 2.132 2.089 2.028
San Marcos Unified School District General Fund Obligations 0.076 0.834 0.831 0.837
Vista Unified School District Certificates of Participation - - - -
Encinitas Union School District Certificates of Participation 0.008 0.004 - -
San Dieguito Union High School District General Fund Obligations - 0.048 0.049 0.059
Other Unified School District Certificates of Participation 0.002 0.002 0.002 0.002
Total Overlapping General Fund Obligation Debt 6.480$ 6.805$ 6.618$ 6.476$
Overlapping Tax Increment Debt (Successor Agency):-$ -$ -$ -$
Total Overlapping Debt:20.431 20.323 23.510 25.892
City of Carlsbad Direct Debt:
City of Carlsbad Governmental Activities Obligations - - 0.025 0.021
Total City of Carlsbad Direct Debt -$ -$ 0.025$ 0.021$
Combined Total Debt 20.431$ 20.323$ 23.535$ 25.913$
Source: MuniServices, LLC and California Municipal Statistics, Inc.
172
2013 2014 2015 2016 2017 2018
0.080$ 0.062$ 0.049$ 0.039$ 0.030$ 0.023$
- - - - - 0.918
0.375 0.361 0.562 0.520 0.619 0.571
8.312 7.921 7.073 6.370 5.816 5.298
0.103 0.052 - - - 0.051
0.001 - - - - -
0.031 0.028 0.025 0.022 0.024 0.018
0.454 0.426 0.385 0.515 0.551 0.506
1.711 2.248 2.087 1.922 1.797 1.706
0.076 0.057 0.035 0.027 0.020 0.014
0.353 0.336 0.308 0.285 0.258 0.181
0.230 0.292 0.254 0.232 0.199 0.509
0.918 0.864 0.690 0.626 0.566 1.032
0.621 0.607 0.967 0.906 1.031 0.003
0.004 0.004 0.003 0.003 0.003 0.908
1.082 1.032 0.928 0.855 0.983 0.016
0.022 0.023 0.021 0.019 0.017 -
- - - - - 0.244
0.138 0.139 0.031 0.102 0.091 0.079
1.045 1.000 0.903 0.836 0.750 0.684
2.107 2.018 1.727 1.564 1.379 1.240
17.663$ 17.470$ 16.048$ 14.843$ 14.134$ 14.001$
1.070$ 0.983$ 0.857$ 0.709$ 0.648$ 0.684$
2.017 1.865 1.664 1.497 1.347 1.240
0.047 0.042 0.036 0.031 0.025 -
0.028 0.023 0.018 0.014 0.119 -
0.006 0.006 0.005 0.004 0.003 0.572
1.967 2.086 1.846 1.692 1.598 1.168
0.458 0.441 0.407 0.376 0.378 0.023
0.001 0.001 0.001 0.001 0.001 0.005
- - - - - 0.002
0.051 0.049 0.047 0.044 0.041 1.447
- - - - - 0.459
5.645$ 5.496$ 4.881$ 4.368$ 4.160$ 5.600$
0.376$ 0.341$ 0.290$ 0.250$ 0.212$ 0.177$
23.684 23.307 21.219 19.461 18.506 19.778
0.007 - - - - -
0.007$ -$ -$ -$ -$ -$
23.691$ 23.307$ 21.219$ 19.461$ 18.506$ 19.778$
173
Legal Debt Margin Information
Last Ten Fiscal Years
(dollars in thousands)
2009 2010 2011 2012
Net assessed valuation 23,517,153$ 23,234,948$ 23,012,997$ 22,982,172$
Debt limit (25% x 15%)881,893 871,311 862,987 861,831
Less amount of debt applicable to limit:
Bonded debt 29,005 28,225 27,405 17,345 (1)
Certificates of participation - - - -
Loan payable - - 581 475
Obligations under capital leases 736 502 256 14
Total net debt applicable to limit 29,741 28,727 28,242 17,834
Legal debt margin 852,152$ 842,584$ 834,745$ 843,997$
Total net debt applicable to the limit
as a percentage of debt limit 3.37%3.30%3.27%2.07%
Note: Under state finance law, the city's outstanding general obligation debt should not exceed 15 percent (as adjusted by 25
percent per the law) of total assessed property value. By law, the general obligation debt subject to the limitation
(2) The golf course bonds were defeased during FY 2016-17.
may be offset by amounts set aside for repaying general obligation bonds.
(1) The 1993 Carlsbad Housing & Redevelopment Commission Tax Allocation Bonds were transferred to a trust fund due to
the dissolution of the Redevelopment Agency in FY 2011-12.
0%
1%
2%
3%
4%
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Percent of Debt Applicable to the Legal Debt Limit
Last Ten Fiscal Years
Fiscal Year
174
2013 2014 2015 2016 2017 2018
22,956,650$ 23,522,746$ 25,489,468$ 26,924,891$ 28,423,782$ 29,994,964$
860,874 882,103 955,855 1,009,683 1,065,892 1,124,811
17,005 16,645 16,260 15,855 - (2)-
- - - - - -
159 - - - - -
- - - 970 785 588
17,164 16,645 16,260 16,825 785 588
843,710$ 865,458$ 939,595$ 992,858$ 1,065,107$ 1,124,223$
1.99%1.89%1.70%1.67%0.07%0.05%
175
Pledged-Revenue Coverage
Last Ten Fiscal Years
2009 2010 2011 2012 2013
Wastewater Revenue Bonds
Gross revenues (1), (5)10,551,005$ 10,837,232$ 11,564,398$ 12,391,225$ 12,599,601$
Less expenses (2), (5)7,523,300 6,197,845 6,060,142 6,645,436 7,094,310
Net available revenue 3,027,705$ 4,639,387$ 5,504,256$ 5,745,789$ 5,505,291$
Debt service
Principal (5)675,000$ 705,000$ 740,000$ 780,000$ 820,000$
Interest (5)262,169 228,006 191,419 152,468 111,469
Total debt service 937,169$ 933,006$ 931,419$ 932,468$ 931,469$
Coverage 3.23 4.97 5.91 6.16 5.91
Recycled Water Loans
Gross revenues (3)5,749,477$ 6,635,220$ 5,942,531$ 7,002,009$ 8,160,109$
Less expenses (4)2,925,479 3,300,263 3,629,787 4,133,530 4,019,176
Net available revenue 2,823,998$ 3,334,957$ 2,312,744$ 2,868,479$ 4,140,933$
Debt service
Principal 1,223,781$ 1,252,343$ 1,282,018$ 1,312,398$ 1,343,498$
Interest 652,702 624,140 594,463 564,084 532,983
Total debt service 1,876,483$ 1,876,483$ 1,876,481$ 1,876,482$ 1,876,481$
Coverage 1.50 1.78 1.23 1.53 2.21
Golf Course Revenue Bonds
Gross revenues (1), (6)7,680,342$ 7,080,711$ 7,582,458$ 7,863,951$ 6,777,292$
Less expenses (2), (6)6,848,161 6,426,412 6,356,592 6,177,438 5,954,896
Net available revenue 832,181$ 654,299$ 1,225,866$ 1,686,513$ 822,396$
Debt service
Principal (6)275,000$ 290,000$ 305,000$ 325,000$ 340,000$
Interest (6)821,550 810,250 798,350 785,750 771,600
Total debt service 1,096,550$ 1,100,250$ 1,103,350$ 1,110,750$ 1,111,600$
Coverage 0.76 0.59 1.11 1.52 0.74
Source: City of Carlsbad Comprehensive Annual Financial Reports
(1) Includes operating and non-operating revenues and transfers in from the General Fund.
(2) Includes operating and non-operating expenses, excluding interest expense and depreciation.
(3) Includes recycled water operating and non-operating revenues and fees.
(4) Includes recycled water operating and non-operating expenses, excluding interest expense and depreciation.
(5) Debt service on the wastewater revenue bonds was completed during FY 2015-16.
(6) The golf course bonds were defeased during FY 2016-17.
176
2014 2015 2016 2017 2018
13,699,286$ 13,723,835$ 13,723,835$ -$ -$
6,989,194 7,249,798 7,249,798 - -
6,710,092$ 6,474,037$ 6,474,037$ -$ -$
860,000$ 905,000$ 905,000$ -$ -$
68,419 23,191 - - -
928,419$ 928,191$ 905,000$ -$ -$
7.23 6.97 7.15 n/a n/a
9,392,061$ 9,210,258$ 8,216,362$ 8,371,467$ 9,869,958$
3,640,786 3,826,699 4,679,706 4,863,054 5,559,509
5,751,275$ 5,383,559$ 3,536,656$ 3,508,413$ 4,310,449$
1,375,337$ 1,407,932$ 1,441,301$ 1,475,461$ 1,510,433$
501,144 468,550 435,182 401,021 366,049
1,876,481$ 1,876,482$ 1,876,483$ 1,876,482$ 1,876,482$
3.06 2.87 1.88 1.87 2.30
7,747,116$ 8,428,375$ 8,196,853$ -$ -$
6,125,159 6,302,019 6,273,320 - -
1,621,957$ 2,126,356$ 1,923,533$ -$ -$
360,000$ 385,000$ 405,000$ -$ -$
755,850 739,088 721,313 - -
1,115,850$ 1,124,088$ 1,126,313$ -$ -$
1.45 1.89 1.71 n/a n/a
177
Demographic and Economic Statistics
Last Ten Fiscal Years
Year
Total
Population
% of S.D.
County
Population
% Change from
Previous Year Median Age
Average
Household Size
2009 103,406 3.30%-0.39%39.4 2.50
2010 105,055 3.30%1.59%38.7 2.53
2011 106,555 3.42%1.43%39.4 2.53
2012 107,674 3.43%1.05%40.3 2.58
2013 108,246 3.44%0.53%39.3 2.63
2014 110,169 3.45%1.78%40.3 2.53
2015 110,653 3.43%0.44%41.1 2.30
2016 112,930 3.43%2.06%42.1 2.68
2017 113,725 3.43%0.70%41.9 2.58
2018 114,622 3.43%0.79%42.3 2.60
Sources: MuniServices, LLC
Population projections are from the California Department of Finance
(2) Per Capita Personal Income is reported starting in FY 2010-11; prior amounts are Median Household Income, adjusted for inflation.
Household and demographic characteristics estimates are from the United States Census Data Sets Tables.
Unemployment rate estimates are from the California Employment Development Department, Bureau of Labor Statistics.
(1) Personal income is the estimated total aggregate income for the total population.
178
% High School
Graduate
% Bachelor's
Degree or
Higher
Personal
Income (1)
(millions)
Per Capita
Personal
Income (2)
City
Unemployment
Rate
95.8%50.9% n/a 70,833$ 3.90%
n/a n/a n/a 70,581$ 6.50%
96.2%51.6%4,048$ 37,985$ (2)6.80%
95.3%50.6%4,304$ 39,975$ 6.30%
88.5%35.4%4,403$ 40,672$ 5.90%
95.6%51.3%4,862$ 44,134$ 6.30%
96.0%51.9%4,907$ 44,345$ 4.30%
95.6%54.8%5,741$ 50,838$ 5.20%
95.8%54.2%6,060$ 53,285$ 4.20%
95.7%55.0%6,496$ 56,675$ 3.00%
(2) Per Capita Personal Income is reported starting in FY 2010-11; prior amounts are Median Household Income, adjusted for inflation.
Educational Attainment
Household and demographic characteristics estimates are from the United States Census Data Sets Tables.
Unemployment rate estimates are from the California Employment Development Department, Bureau of Labor Statistics.
(1) Personal income is the estimated total aggregate income for the total population.
179
Principal Employers
Current Year and Nine Years Ago
Employer Industry Employees Rank
% of Total City
Employment Employees Rank
% of Total City
Employment
Legoland California Hospitality/Tourism 2,300 1 3.26%968 6 1.78%
ViaSat Information Technology 2,153 2 3.05%1,394 4 2.56%
Life Technologies Life Sciences 1,982 3 2.81%3,795 1 6.98%
Omni La Costa Resort & Spa Hospitality/Tourism 1,300 4 1.84%1,000 5 1.84%
Carlsbad Unified School District Education 1,013 5 1.43%940 7 1.73%
Gemological Institute of America Research/Education 856 6 1.21%- --
City of Carlsbad Government 698 7 0.99%714 10 1.31%
Nortex Security Control Information Technology 637 8 0.90%- --
HM Electronics Information Technology 571 9 0.81%- --
Taylor Made Golf Company Action Sports 570 10 0.81%2,075 2 3.82%
Park Hyatt Aviara Resort Hospitality/Tourism - --823 8 1.51%
Nordson Asymtek Manufacturing - --768 9 1.41%
Callaway Golf Company Action Sports - --1,637 3 3.01%
Subtotal Employees 12,080 17.11%14,114 25.97%
Total Employees (estimate)70,614 54,347
Source: Carlsbad Business License Data
2018 2009
180
This
p
a
g
e is intentionally left blank.
181
Authorized Full and 3/4 Time City Government Employees by Program Area
Last Ten Fiscal Years
Program Area 2009 2010 2011 2012 2013
Policy and Leadership Group
City Attorney 7.00 7.00 7.00 7.00 7.00
City Clerk and Records Management - - - - -
City Council 1.00 1.00 1.00 1.00 1.00
City Manager 8.00 8.00 8.00 7.00 7.00
City Treasurer 0.75 0.75 0.75 0.75 0.75
Communications 3.75 3.75 2.75 2.75 2.75
Records Management 8.00 8.00 8.00 6.25 6.00
Administrative Services
Finance and Risk Management 32.00 31.00 30.50 30.50 30.50
Human Resources and Workers' Comp 10.00 10.00 9.00 9.00 9.00
Information Technology 19.50 19.00 22.50 (2)22.50 22.50
Public Safety
Police 162.00 162.00 162.00 162.00 161.00
Fire 88.75 88.75 88.75 87.75 87.75
Community Development
Community and Economic Development 50.00 50.00 54.00 (2)50.00 47.00
Housing and Neighborhood Services 10.00 10.00 11.00 (2)13.00 10.00
Community Services
Library and Arts 53.00 53.00 52.25 51.25 51.25
Parks and Recreation 30.50 72.10 (1)71.95 70.95 68.40
Public Works
Environmental Management - - - - -
General Services, Engineering, Environmental 174.80 133.00 (1)- (2)- -
General Services - - - - -
Property and Fleet - - 41.60 (2)39.60 40.55
Public Works Administration - - - - -
Transportation - - 58.40 (2)54.40 54.40
Utilities 55.20 55.40 69.55 (2)68.55 67.65
Full and 3/4 Time Authorized Employees 714.25 712.75 699.00 684.25 674.50
Net Increase/(decrease) over prior year 3.00 (1.50) (13.75) (14.75) (9.75)
Source: City of Carlsbad Operating Budget
Notes: A full-time employee is scheduled to work 2,080 hours per year (including vacation and sick-leave).
(2) During FY 2010-11, the Community Services, Public Works and Information Technology groups were reorganized.
(3) During FY 2014-15, the Policy and Leadership and Community Services groups were reorganized.
(4) During FY 2015-16, FY 2016-17, and FY 2017-18, the Public Works group restructured divisions.
(5) During FY 2017-18, the City Clerk and Records Management Departments merged.
(1) During FY 2009-10, the Parks Department was moved from Public Works to Parks and Recreation.
A 3/4 time employee is scheduled to work 1,560 hours per year (including vacation and sick-leave).
182
2014 2015 2016 2017 2018
7.00 7.00 7.00 6.00 7.00
- 3.00 (3)3.00 3.00 6.00 (5)
1.00 1.00 1.00 1.00 1.00
7.00 7.00 7.00 8.00 8.00
0.75 0.75 0.75 0.75 0.75
2.75 4.75 (3)5.00 5.00 5.00
5.00 2.00 (3)2.00 2.00 - (5)
31.50 31.50 32.50 33.00 32.00
9.00 11.00 11.00 11.00 11.00
22.50 22.50 19.50 20.00 27.00
161.00 162.00 168.00 168.00 168.00
88.00 89.00 89.00 90.00 90.00
44.00 44.00 44.00 44.00 44.00
10.00 12.00 13.00 13.00 13.00
51.25 50.25 (3)50.50 50.50 50.50
67.60 61.60 (3)58.15 57.15 57.00
- - 8.50 (4)9.50 (4)9.70
- - - - -
- - - - 52.00 (4)
40.60 39.90 28.10 (4)51.30 (4)- (4)
- - 8.05 (4)9.85 (4)12.30
53.40 55.90 57.35 33.00 32.00 (4)
65.40 64.60 60.85 (4)60.20 (4)59.00
667.75 669.75 674.25 676.25 685.25
(6.75) 2.00 4.50 2.00 9.00
183
Operating Indicators by Function/Program
Last Ten Fiscal Years
2009 2010 2011 2012 2013
General Government
Number of applications processed (full and part-time)3,134 5,260 2,416 1,998 10,904 (8)
Number of external new hires (full and part-time)42 27 31 16 151 (8)
Number of internal promotions / transfers (full-time only)25 34 5 6 6
Business licenses processed 9,029 9,173 9,539 9,303 9,422
Number of outgoing payments processed 41,381 40,310 41,344 39,075 38,441
Public Safety
Police
Calls for service 94,492 94,678 97,414 93,248 90,122
Average priority one response (minutes)5.9 6.0 5.5 5.9 5.8
Cases 10,309 8,826 8,188 7,963 8,314
Fire
Emergency responses 7,853 9,503 9,084 9,106 10,755
Response time: arrivals on scene within goal standard 85%74%71%72%71%
Community Development
Affordable housing units completed 90 6 5 - 59
Financial assistance to affordable housing projects 1,014,000$ 3,750,000$ 525,000$ 780,000$ 7,408,000$
Building permits issued n/a n/a 2,600 1,400 1,500
Building inspections conducted 15,000 15,500 19,500 19,000 24,000
Final inspections (residential dwelling units)200 300 260 271 440
Final inspections (commercial square feet)n/a n/a n/a n/a n/a
Code enforcement actions 4,484 3,400 4,320 3,827 4,943
Community Services
Library - total material circulation 1,334,875 1,365,127 1,362,700 1,358,839 1,348,333
Library - patron visits 670,932 749,514 858,788 858,422 821,045
Arts - number of events 58 54 44 50 50
Arts - attendance of events 80,000 80,000 80,000 75,000 80,000
Recreation - youth sports participants 1,200 1,200 1,200 1,200 1,200
Recreation - adult sports participants 5,400 5,400 5,400 5,450 5,200
Recreation - enrichment class enrollees 13,539 13,075 13,300 12,650 12,200
Recreation - special events participants 10,700 12,000 9,000 10,000 13,000
Recreation - aquatics classes conducted 350 368 470 557 575
Trees trimmed 1,820 1,816 2,221 1,863 1,936
Public Works
Streets
Road miles resurfaced- overlay or slurry seal 4.7 15.3 3.8 25.2 24.3
Carlsbad Municipal Water District
Average consumption (millions of gallons per day)17.7 15.3 (1)14.1 (1)14.4 15.4
Annual water deliveries (acre feet)19,867 17,142 (1)15,786 (1)16,104 17,248
Water connections 27,890 27,910 27,978 28,379 28,947
Wastewater
Sewage pumped (millions of gallons per day)7.11 7.10 7.57 6.92 6.65
Annual flow (millions of gallons)2,595 2,590 2,762 2,524 2,426
Wastewater connections 22,331 22,335 22,342 22,631 22,955
Source: City of Carlsbad
(1) Water deliveries and consumption decreased significantly in FY 2008-09 through 2010-11 as a result of conservation efforts.
(2) Increases in the number of participants is the result of the opening of the Alga Norte Community Park in FY 2013-14.
(3) Increases in the number of enrichment class and special events participants are the results of overall higher attendance and including
recategorized classes previously not classified or included as enrichment classes or special events in prior years.
(4) The decrease in patron visits is due to the temporary closures of library facilities for remodeling during the year.
(5) The decrease is due to the time involved with the implementation of a new licensing system during FY 2016-17.
(6) Reporting of information is not available for FY 20167-17 due to the implementation of a new permitting system.
(7) Beginning in FY 2016-17, 2,500 AF of contracted desalinated water is included in the water purchase totals.
(8) Beginning in FY 2012-13, part-time applicants were added to the number of applicants and new hires.
184
2014 2015 2016 2017 2018
9,527 8,551 8,037 9,544 9,455
284 299 260 292 311
47 41 31 58 44
10,327 10,735 11,449 8,142 (5)11,267
39,310 40,663 41,398 41,304 41,869
87,976 91,314 92,061 84,858 90,760
5.8 6.5 6.1 5.9 5.8
8,296 8,349 9,253 8,884 8,643
9,925 9,830 11,455 12,515 12,039
63%63%64%64%61%
- - - - -
-$ 2,646,000$ -$ 1,280,000$ -$
1,400 1,600 3,000 4,500 4,392
19,000 21,000 23,000 27,000 22,671
190 200 200 600 289
45,000 60,000 60,000 95,000 155,292
4,794 5,389 10,994 n/a (6)9,538
1,369,369 1,293,282 1,103,090 1,243,228 1,169,247
791,533 804,003 609,679 (4)720,205 685,188
62 80 88 79 82
75,000 87,000 85,000 79,067 65,817
2,292 (2)1,000 1,000 968 1,003
5,600 6,150 5,600 4,500 4,800
10,350 19,030 (3)19,632 17,402 12,996
13,600 17,841 (3)19,474 12,150 11,645
1,018 (2)1,224 684 733 778
1,920 2,018 1,965 1,971 1,954
14.8 18.1 20.0 23.8 25.8
15.9 14.6 12.1 11.0 12.3
17,801 16,368 13,578 14,616 (7) 16,032
29,045 29,190 29,190 29,782 30,054
6.53 5.90 6.17 5.82 6.32
2,384 2,152 2,252 2,125 2,306
23,282 23,431 23,431 23,747 23,863
185
Capital Asset Statistics
Last Ten Fiscal Years
2009 2010 2011 2012 2013
Community Services
Number of parks and community fields 31 31 31 31 31
Acres of developed parks 183 183 183 183 183
Acres of open space and community fields 790 790 790 790 755
Miles of trails 38 47 47 47 47
Number of pools 1 1 1 1 1
Number of community centers 4 4 4 4 4
Number of libraries 3 3 3 3 3
Number of Materials in Library Collections 380,000 642,118 645,414 645,414 625,893
Public Safety
Fire Protection
Number of stations 6 6 6 6 6
Number of fire trucks 11 11 11 12 12
Number of ambulances 5 5 5 5 6
Number of other fire vehicles 14 14 14 15 15
Police Protection
Number of patrol and other vehicles 91 91 90 90 88
Number of motorcycles 18 15 11 11 13
Public Works
Carlsbad Municipal Water District
Miles of lines and mains 447 447 518 (1)527 534
Wastewater
Miles of sewers 269 282 284 288 288
Streets
Miles of streets 340 340 340 340 343
Number of street lights 7,100 7,113 7,126 7,142 7,179
Number of traffic signals 168 172 172 172 174
Source: City of Carlsbad
(1) During FY 2010-11, the figure for miles of lines and mains was adjusted to include recycled lines and mains.
186
2014 2015 2016 2017 2018
33 33 33 33 33
281 319 319 319 319
728 728 728 728 728
47 47 47 47 47
3 3 3 3 3
4 4 4 4 5
3 3 3 3 3
581,865 574,775 563,581 491,956 477,149
6 6 6 6 6
13 12 12 12 13
8 7 6 5 5
16 15 18 20 20
114 114 106 106 96
13 14 15 12 13
534 534 559 559 559
288 288 288 288 288
346 347 348 350 350
7,236 7,262 7,265 7,334 7,337
174 177 177 177 178
187
This
p
a
g
e is intentionally left blank.
188